A stock balance that disagrees with the shelf creates pressure to make the number match. Typing over the balance does that quickly, but it also removes the evidence that would explain what went wrong. A useful adjustment is a recorded correction: it states what the record said, what was observed, why the difference exists, who authorised the change and what was actually posted.
This guide covers one correction case at a time. It is not a stock count method, a receiving check or a waste log, and it does not value stock or decide accounting treatment. The bowl example below, AJ-023, is original fiction.
Scope one case before changing anything
Open a separate copy of the record for each case. Name one item, one variation if the item has them, one location, one base unit and one cutoff date and time. Twelve pieces at one outlet and two boxes at another are not one discrepancy, and adding unlike units or locations together hides which record is wrong.
Write the record reference and the quantity it showed at the cutoff before anyone changes it. This before-figure is the anchor for everything that follows. If the system has already moved on because sales or receipts were posted after the cutoff, note those movements separately rather than mixing them into the comparison.
The form is manual. It has no formulas, calculates no differences and approves or posts nothing. It holds no prices, values, tax or accounting entries; those belong in your existing finance process. It is a record of one decision and the evidence behind it, not an audit, a certification or a safety assurance.
Separate the observation from the reason
An observed difference is a fact about two numbers. A reason is an explanation that needs its own evidence. Record the physical observation first, including who counted and when, then arrange an independent recount by someone who did not produce the first figure. Keep both counts; a recount that agrees strengthens the observation, and one that disagrees means the case is not ready.
Next, check the underlying movements for the same item, location and period: receipts, transfers, recorded waste, sales deductions and any earlier adjustments. Only then propose a reason, and list the evidence that supports it. If nothing explains the difference, the honest reason is that it is unexplained.
Worked example: AJ-023, standard bowls at Outlet North
In this fictional case, item BW-06 is a standard bowl counted in pieces at Outlet North. At the stated cutoff, the stock record shows 30 pieces. An independent recount finds 24. The reviewer traces the movements and finds that receipt GRN-117, covering six bowls, appears twice as stock entries ST-117-A and ST-117-B.
The reviewer checks the original receipt, both postings, every other movement for the item and the matching cutoff. The evidence supports reversing only the duplicate ST-117-B. In this example there are no intervening stock movements between the captured before-balance and the posting verification, so 30 minus 6 gives 24. The correction changes the record; it is not a new physical movement or evidence of waste or loss.
| Step | Record entry | Evidence or reference | Status |
|---|---|---|---|
| Before | Balance 30 pieces at cutoff | Stock record reference noted before any change | Recorded |
| Observation | Independent recount 24 pieces | Recount sheet with counter and time | Recorded |
| Proposed reason | Receipt GRN-117 posted twice | ST-117-A and ST-117-B both trace to one receipt | Supported for ST-117-B only |
| Request | Minus 6 pieces; expected after-balance 24, written by hand | Requester and date | Submitted |
| Authorisation | Approved by an independent reviewer | Approval note referencing the evidence | Approved, not yet posted |
| Posting | ADJ-023 reverses ST-117-B | ST-117-A and ST-117-B kept in history | Posted |
| Verification | Resulting balance 24 pieces | Independent check after posting | Verified |
When the difference has no evidence
Suppose instead the recount showed 24, but every movement checked out and no duplicate or missed entry could be found. The proposed duplicate-entry reversal stays on hold because that explanation is unsupported. Do not invent a reason such as breakage or waste. If your existing process separately authorises an adjustment to a verified physical count, identify it as a count adjustment with the cause still unexplained, retain its evidence and authority, and keep the investigation open. Updating the count does not establish why it differed.
Missing evidence is not a positive result. An empty evidence field means the explanation has not been established, and the form should show that plainly rather than leaving a reason that reads as settled.
Keep the history intact
Correct a posted mistake with a linked, authorised reversal or correction entry in the existing system, not by deleting or editing the original. In AJ-023 both ST-117-A and ST-117-B remain visible, and ADJ-023 points to the entry it reverses. Anyone reviewing later can see the error and the fix together.
Before posting, check that the same correction has not already been made. Search for adjustments that reference the original event, here GRN-117 and ST-117-B, and for any adjustment reference already used for this case. Two people fixing the same duplicate independently would create a new error.
If the correction falls in a period that has already been closed or reported, route it through whoever is responsible for that period under your existing process. This form gives no permission to reopen or overwrite a closed period. Likewise, if evidence arrives after the case was decided, record it as late evidence with its own date, and keep the original count and decision unchanged beside it.
Where the principle comes from
Square's help article on stock adjustment history describes reviewing past adjustments with their reasons, and filtering or inspecting them by item, variation, location, date and individual event details. Only that general idea, that adjustments are kept as a reviewable history with reasons and event details, is used here. Its plans, screens and adjustment categories are not applied, and nothing here describes how any other system, including Keystonne, handles adjustments.
Put it into practice
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From reading to doing
Stock Adjustment Record
Open Stock Adjustments for one case: one item, variation, location, base unit and cutoff. Every field is entered by hand and the sheet performs no calculations, approvals or postings. Record the case reference, the before-record reference and quantity, the observation and the independent recount, and the underlying movements checked. Enter the proposed reason with its evidence references, the requested signed quantity and the expected after-balance written manually. Separate fields hold the authorisation decision or hold with its reason, the actual posting reference and person, the before and after history references, the post-posting verification, and any remaining investigation or late evidence. A blank evidence field is not a positive result. The sheet holds no values, tax or accounting entries and does not provide audit or certification.
Open the Stock Adjustments tab in the launch workbook. Keep a copy for your own business.
Download the free workbook See what’s inside the toolkit →Sources & further reading
- View stock adjustment history (Square Support Center) ↗
Retrieved 8 November 2026. Used only for the general principle that stock adjustments are kept as a reviewable history with reasons and with item, variation, location, date and event details. Square plans, screens, export columns and adjustment categories are not adopted, and no Keystonne feature is implied. AJ-023, BW-06, Outlet North and all references are original fiction.
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