I have a query related to Inventory revaluation. It is in context of Indian client having continuous manufacturing operation. Has 3 company code across 3 countries.
When Standard cost is released, system revalues total inventory while client wants revaluation should happen only for 1 month old inventory.
Revaluation of total inventory causes financial posting in system for old stock also. e.g. I have 6 months old stock ( e.g. 100 units ) and Standard price has now increased by 1 INR.
System will post following entry
Dr Inventory 100 [B/S ]
Cr Inventory revaluation 100 [P&L ]
Please share your views how inventory revaluation of old stock can be avoided. Do other Indian / Global company have similar requirement ??
Does accounting standard specify that only current month inventory should be revalued ? Can FIFO/LIFO valuation method help in this context ??