Manufacturing finance for manufacturers
A part priced from an old cost sheet can lose money for a full contract year before the accounts show it. We carry out factory accounting, product costing, inventory valuation, stock work and working-capital analysis that tie stores and production to the ledger.
Last reviewed 3 October 2026
Product cost, inventory and working capital in a factory are often three separate sets of numbers. The gap is usually found during a bank renewal or a stock audit, when there is little time to trace it. From our Nashik office we rebuild cost sheets and close factory books, and stock is reconciled with the bank for single-plant units and multi-unit groups.
Cost, stock and cash on the factory floor
In a foundry or machine shop, the cost sheet, the inventory record and the bank stock statement are often prepared by different people from different figures. When they disagree with the bill of materials and the production log, a price-down is accepted on a cost that no longer holds, and the stock auditor asks for an explanation the books cannot give. We examine the points below first. These are general notes as at 1 October 2026.
Cost sheets under price pressure
Suppliers of auto components, engineering parts and electrical panels negotiate price revisions every year. We build the cost sheet from the bill of materials, routing, machine hours and rejection rate, and it shows whether a part still recovers material, conversion and overhead after the reduction.
Yield, scrap and rejections
Turnings, borings, runners and rejected castings alter the cost of good parts as well as the taxable scrap sale. Production logs, scrap registers and sales invoices are therefore required to record one consistent quantity.
Job-work stock and month-end cut-off
Material lying with platers, machine shops and assemblers belongs in the accounts and in the GST records. A month-end cut-off error misstates margin and working capital together.
Inventory valuation and the bank
Drawing power usually rests on inventory and receivables, and the figures filed with the bank should agree with the books. Any difference is a routine question in a tax review or a stock audit.
Overhead and idle capacity
Power, maintenance, tooling and supervision are absorbed on a basis that reflects how the plant actually runs. Where capacity is under-used, idle time is shown apart from the cost of good parts.
Related reading
Full manufacturing finance scope: manufacturing finance. Sector context: manufacturing. Method note: factory cost accounting. Year-end sequence: year-end review checklist. To request a meeting, contact the firm.
Common questions
Is this the same as a statutory audit?
No. Manufacturing finance is management-facing work on costing, inventory and cash. It cannot substitute for a statutory or tax audit, and independence rules may limit what can be combined with an audit engagement.
We only make a few dozen part numbers. Is a cost sheet still useful?
Yes. A short sheet that separates material, conversion and scrap by part is enough to test a price-down or a make-versus-buy choice. The depth of the work is set to the size of the operation.
Can you reconcile book stock with the bank stock statement?
Yes. This reconciliation is often the first deliverable before a renewal or a stock audit. Each difference is explained by location, job-work stock or valuation, and none is left as a balancing figure.
How does this sit beside GST and income tax?
Scrap sales, stock valuation and job-work balances feed both GST and the tax computation. We keep the factory numbers consistent with those filings, while returns and notices are covered by separate engagements.
Manufacturing, Manufacturing finance. See also: Manufacturing finance, GST and Indirect Tax, Business advisory
Contact the firm
About Manufacturing finance for manufacturers, or any related matter. A phone number or an email address is enough for us to reply.
- Office
- Office at Plot 08, Eden Complex, Gangapur Road, Nashik 422222
- Hours
- 9:30 AM to 8:00 PM; other times by appointment