Inventory
The Inventory module forecasts stock levels and the associated cash and Balance Sheet impact. It tracks what you purchase, what you sell, and what remains in stock — including the cash timing effects of prepayments before delivery and safety stock buffers.
When to use Inventory
Use this module when:
- Inventory is a material Balance Sheet item
- You want to model stock build-up or draw-down over the forecast period
- You pay for goods before receiving them (prepayments to suppliers)
- You maintain safety stock buffers that tie up working capital
- You want Cash Flow to reflect the timing of purchases, not just the sale of goods
Creating the module
- In your Scenario, click Add a budget
- Choose Inventory
- Follow the setup wizard (4 steps)
Step 1 — Introduction
Set the forecast period. Optionally link a COGS budget version — if connected, the Inventory module reads quantities sold from COGS (which in turn can read from P×Q). This creates a fully linked chain: sales → COGS → inventory consumption → purchase requirements.
Step 2 — Model
Products
Add the products you hold in inventory. For each product, configure per period:
| Input | What it defines |
|---|---|
| Quantity | Units in stock at the start of the period |
| Average price | Purchase cost per unit (used for inventory valuation) |
| Starting balance | Opening stock value at the start of the forecast |
| Safety stock % | Minimum stock buffer as % of period demand — Monitr calculates the minimum stock level to maintain |
Purchase transactions
Monitr calculates required purchases based on:
Required purchases = Quantities sold (from COGS) + Safety stock buffer − Opening stock
You can override calculated purchase quantities per product per month when you know of planned orders.
Calculated fields (shown in result)
| Field | What it shows |
|---|---|
| Start balance | Opening inventory value |
| Quantities sold | Units consumed (from COGS link or manual entry) |
| Quantities purchased | Units ordered/received |
| End balance | Closing inventory value |
| Quantity mutation | Net change in units |
| Currency mutation | Net change in inventory value (cash impact) |
Step 3 — Prepayments
Many businesses pay suppliers before goods are received. The Prepayments step models this timing:
| Setting | What it controls |
|---|---|
| Prepayment % per product | Portion of the purchase price paid upfront (e.g. 30% deposit) |
| Months before delivery | How far in advance the prepayment is made (e.g. 2 months before goods arrive) |
Monitr shifts the prepayment cash outflow earlier than the actual inventory receipt — this is critical for accurate Cash Flow forecasting in businesses with long supplier lead times.
Step 4 — Mapping
Assign budget accounts:
| Entry type | What it maps |
|---|---|
| Inventory | The Balance Sheet stock/inventory account |
| Prepayments | Prepaid supplier account (appears on BS until goods are received) |
| Per product | Optional per-product breakdown for multi-category stock reporting |
Output in reports
- Balance Sheet → inventory balance (opening + purchases − sales at cost); prepayment balance
- Cash Flow → purchase cash outflows (including prepayment timing); cash outflows appear when goods are ordered/prepaid, not when sold
- Inventory dashboard → stock level trend, opening vs. closing balance per period, purchase schedule
Module chain
The Inventory module is the last in a chain of linked modules:
P×Q (units sold at price)
→ COGS (cost per unit)
→ Inventory (stock levels + purchase requirements)
When all three are connected, changing a sales quantity in P×Q ripples through to COGS and then to Inventory — automatically recalculating stock consumption and purchase needs.