GRAP 12 - Inventories

CPD hours:  1

Imagine a thriving city where every public service, from healthcare to infrastructure, is effectively delivered to meet the community’s needs. Behind this seamless operation lies the careful management of resources, all guided by clear and structured accounting standards. One of the key standards supporting this framework is GRAP 12.

GRAP 12, or Generally Recognised Accounting Practice 12, provides the framework for accounting for inventories in the South African public sector. It ensures that public entities handle and report on inventories—such as materials, supplies, and goods—accurately, reflecting their true value in financial statements.

For example, a local government department may use GRAP 12 to accurately account for inventory items, whether it is materials for infrastructure projects or supplies for public services. The correct accounting for inventories ensures transparency in how public resources are used and safeguards against waste or misuse of public funds.

By standardising how inventories are recognised, measured, and reported, GRAP 12 helps public entities maintain control over their resources, allocate funds more efficiently, and make informed decisions. It is not just about following accounting rules; it is about enhancing accountability and ensuring public resources are used responsibly for the benefit of all.

Through GRAP 12, public sector entities can present a true and fair view of their inventory holdings, fostering transparency and trust in the management of public resources, and ultimately supporting the sustainable development of public services in the community.

What you will learn

By the end of this course, you will be able to:

• Identify what qualifies as inventory.
• Distinguish between inventory and property, plant and equipment (PPE).
• Recognise and measure inventory in accordance with applicable accounting standards.
• Apply appropriate cost formulas to assign costs to inventory (e.g., FIFO, weighted average).
• Explain the difference between net realisable value (NRV) and current replacement cost.
• Perform a basic net realisable value calculation.
• Identify and prepare required inventory disclosures in the annual financial statements.

Important information

Please take note of the following important details regarding your course access and certification:

• Certificates will be issued on the date of successful completion of the assessment and will reflect that date.
• Course access is valid for 12 months, after which the course will close.
• No updates will be made to the course during the 12-month access period. If updates become available, they will be released in a new course available for purchase on our website.
• For the Altimax terms and conditions, please refer to our website.