At times, the physical condition when delivered can affect the final order, as the purchasing agent can refuse delivery of unacceptable goods. When the order is delivered, the manager reconciles the order by making sure the delivery matches the order placed. Many businesses use purchase orders to execute the transaction. Replenishment orders are made when inventory reaches critical stocking levels. Inventory management personnel use one of two types of control styles: continuous review, which calls for real-time updating of levels, or fixed interval, which requires periodic inventory review. This avoids carrying costs and can improve the company's bottom line. Some businesses produce goods using just-in-time manufacturing, where assembly parts or materials are delivered only when they are immediately needed. If the company manufactures finished products from parts or raw materials, the manager may be required to maintain a balance between supplies and finished goods. Then the inventory manager must control the process of storing and then transferring the goods to the customer. Purchasing inventory, sometimes called procurement, involves a purchasing agent researching and negotiating with vendors who can supply the raw materials, parts, or finished goods a company sells to its customers. Many use a system called material requirement planning (MRP) to coordinate forecasting, ordering, delivery, and storage functions. The manager oversees the material or supply order placement, delivery schedules, and product handling when the goods arrive. The process, which starts with estimating inventory levels, can follow unfinished goods all the way through manufacture and delivery to the end user. For international companies, the principles and standards followed are issued in the International Financial Reporting Standards (IFRS). Though not a governmental organization, the FASB is designated by the Securities and Exchange Commission (SEC) to set the standards for all publicly traded enterprises. The group guides the practices of private-sector, public, and private companies, both for-profit and nonprofit types. The current principles have been developed by the Financial Accounting Standards Board (FASB), a private, nonprofit organization created in 1973. In the U.S., business managers typically follow generally accepted accounting principles (GAAP) that establish standards for documenting and reporting financial data. Accounting is defined as the recording, reporting, and analysis of the financial transactions of businesses, individuals, or other entities. When money changes hands, there is typically a record of it and that record forms the foundation of an important facet of business management: the discipline of accounting. Commercial enterprises exist to make money.
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