The entities set up the classification according to the most appropriate internal management needs. The recommendation is that the entities set up this classification with reference to the classification of French activities, so that the internal classification, at its most aggregated level, can be: either identical to the official classification, or a simple subdivision of the official classification so that it can be compiled by simple addition; in the exceptional case where items cannot be broken down according to the official classification, they can be shown on a " non-allocated " line.

When an entity uses both a purchased material and an intermediate or finished good manufactured by itself, which are similar in all aspects and differ only in their origin, it may open a single account for this material or good. The same rule applies when a good for resale and a finished good that are similar in all aspects are intended for sale.

Accounts 31 " Raw materials (and supplies) " , 32 " Other supplies " and 37 " Inventory of goods for resale " are credited with the amount of the beginning inventory by debiting accounts 6031 " Changes in inventory of raw materials (and supplies) " , 6032 " Changes in inventory of other consumables " , 6037 " Changes in inventory of goods for resale ".

Accounts 33 " Work in progress of goods " , 34 " Work in progress of services " and 35 " Inventory of goods " are credited with the amount of the beginning inventory by debiting accounts 7133 " Changes in work in progress of goods " , 7134 " Changes in work in progress of services " , 7135 " Changes in inventory of goods ".

After performing an inventory count, i.e. the listing and valuation of existing inventories, the following accounts are used:

• Accounts 31, 32 and 37 are debited with the amount of ending inventory by crediting accounts 6031, 6032 and 6037;

• Accounts 33, 34 and 35 are debited with the amount of the closing inventory by crediting accounts 7133, 7134 and 7135.

Account 36 " Inventory from fixed assets " may record during the financial year inventory items dismantled or recovered from fixed tangible assets. It is debited by crediting account 21 " Tangible fixed assets " . At the end of the financial year, account 36 is balanced by debiting account 603 " Changes in inventory (supplies and goods for resale) " . If any of the above inventory items remain at that date, they are debited to the appropriate accounts of Class 3 by crediting account 603.

The perpetual inventory system may be used in general accounting in the appropriate accounts of Class 3 as described hereafter:

1. Regarding inventory of supplies and goods for resale, the accounts 601 " Inventory purchases - Raw materials (and supplies) " , 602 " Inventory purchases - Other consumables " and 607 " Purchases of goods for resale " are debited by crediting the relevant accounts of Classes 4 and 5.

   During the financial year, inventory accounts 31, 32 and 37 are used as warehouse accounts; they are debited with inventory receipts by crediting accounts 6031, 6032 and 6037 and credited with inventory issues by debiting these same accounts.

   At the end of the financial year, the balances of accounts 601, 602, 607 and 6031, 6032, 6037 are transferred to account 120 " Profit for the financial year " or 129 " Loss for the financial year " .

2. Regarding the inventory of goods, account 35 is used as a warehouse account; it is debited with inventory receipts by crediting account 7135 and credited with inventory issues by debiting the same account. These transactions are valued in accordance with the entity's own costing methods.

   Work in progress valued at the end of the financial year is debited to accounts 33 and 34 by crediting accounts 7133 and 7134 after cancellation of the work in progress at the beginning of the financial year. At the end of the financial year, the balance of account 71 " Changes in inventory of finished goods and work in progress " is transferred to account 120 or 129.

   For inventory already owned by the entity but being shipped, i.e. not yet received, or for inventory on deposit or consignment, account 38 may be used to record inventory until receipt in the entity's own warehouse or in the warehouse of the depository or consignee. Once received, this inventory is allocated to the accounts corresponding to its nature. At the end of the financial year, if account 38 is not balanced, the entity provides details of the inventory recorded this way.