Chapter Four
Pharmaceutical Physical
Inventory
Think, Pair, and Share
• Share your experiences on physical inventory.
• Time: 5 minutes
Objectives
• Describe physical inventory concept in
APTS
• List the steps for conducting physical
inventory
Concepts of physical inventory in
APTS
• Physical inventory is counting the actual
amount of pharmaceuticals in a health facility
• All items in the pharmaceutical store and various
dispensing units should be counted
• Physical inventory at the store/s is carried out
every quarter while in dispensaries every month
Concepts . . .
• Purpose of physical inventory
Informs personnel when and how much
of a product to order
Helps to maintain an appropriate stock
level
Ensures continuous availability of
essential medicines
Used to monitor losses
Avoids over and under stocks
Concepts . . .
• Distinct inventory forms are applied for the
pharmacy store and for dispensing outlets
• Different tools are used because of the
differences in the type of information
available at the dispensary and store
– From the store, stock/bin card balance,
discrepancy and cost of medicines can be
obtained
– At the dispensary, physical count and
retail prices are readily available
Steps for physical inventory
Step 1. Activities before inventory
• Arrange all stock at the pharmacy store and
dispensary
• All products should be grouped according to
expiry dates, codes, or cost, etc.
• All pharmaceuticals should be registered in
inventory forms
• Updated inventory tools should be placed in their
respective bins.
• All pharmacy staff except those working in
emergency unit should participate in the physical
Steps…
Step 1. Activities before inventory
• Why all Professionals working in the
hospital should participate in the
inventory?
– All those who worked in these units are
responsible for the shortage and
overages.
– It will be finished within short period
and patient service will not be
compromised.
•
Steps…
Step 2. During physical Inventory
• Inventory should be conducted preferably in
the weekends
• When the last day of the month is not on
weekends physical inventory may be conducted
either the previous or coming weekends
• Note: Physical count should be carried out in
the presence of the responsible persons in the
respective locations (e.g. store manager,
dispensers, etc.)
Steps….
Step 2. During physical Inventory
• The assigned staff should be grouped into
teams of 2 persons.
• Each team carries out the actual count of
allocated shelves.
• Each shelf should be counted by two teams.
• The results of the two counts should be
reconciled
Steps….
Step 2. During physical Inventory
• If there are differences between the two
counts, the shelf should be counted for a
third time
• The team should make sure that all sections
of the inventory forms are properly filled
• The team properly completes, signs and
submits the filled inventory forms to the
pharmacy head of the facility.
Steps….
Step 3. Activities after physical inventory:
Completing and reporting the physical inventory
• The pharmacy accountant must complete the section
to be filled after the inventory.
• The inventory at the pharmacy store is valued based
on the cost of medicines
• The inventory at the dispensary is valued based on
retail prices of medicines
• The monetary values of the physical inventory at the
dispensing outlets should be converted into cost to
bring the values at the store and dispensary into
same unit.
Steps….
• An internal auditor should verify all the findings of
the physical inventory
• A report should be prepared by the pharmacy head
and communicated to the head of the health facility
• The results of the inventory should be further
analyzed and interpreted by methods such as stock
status and consumption analysis methods and ABC
analysis
• The results of the inventory should be used to make
informed decision on:
– continuous availability of essential
pharmaceuticals
– Ensuring effectiveness of mechanisms put to
DU INVENTORY FORM
STORE INVENTORY FORM
Summary
• Physical inventory is counting the actual
amount of pharmaceuticals in a health
facility.
• Physical inventory at the store/s is carried
out every quarter while in dispensaries
every month.
• The physical inventory process is divided
into three steps – Preparation, actual, and