AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
Dead stock is cash you have already spent that is now earning nothing and costing you shelf space. Your options, roughly in order, are to mark it down, bundle it with faster sellers, return or swap it with the supplier, or sell it off for whatever it fetches; whichever you choose, IAS 2 requires the stock to be carried at the lower of cost and net realisable value, so a write-down belongs in your accounts once the item will sell for less than it cost.
Every shop has a corner of goods that stopped selling: last season's school bags, a phone case for a model nobody uses now, a colour of paint the market did not want. The instinct is to wait for a buyer at the original price. Waiting usually costs more than acting, because the goods age, the shelf could hold something that sells, and the naira you paid for them is tied up. This guide sets out what to do, how to compare the options in naira, and how the loss is shown in your books.
How to tell stock is dead, not just slow
Set a rule rather than relying on feel. A common approach is to flag any line that has had no sale for a set period, or whose stock on hand would take far longer to sell than your normal turnover. The period depends on the trade: a provisions shop might flag lines after 60 days, a hardware store after six months. Run the check monthly, as part of your monthly management accounts.
- No sale of the item in your chosen period.
- Stock on hand covers many months of recent sales.
- The item has an expiry date approaching, or a newer version has replaced it.
- The supplier has discontinued it, so there is no reorder to protect.
Your options, from best recovery to worst
1. Mark it down
A clear reduction moves most stock. Reduce in steps (for example 20%, then 40%) and set an end date. If you show a 'was' price, it must be a price you actually charged: section 123 of the Federal Competition and Consumer Protection Act 2018 bars representations that are misleading about price comparisons with earlier prices or about the price at which goods have usually been sold.
2. Bundle it
Pair the slow item with something that sells, at a combined price slightly below the two separately. A buyer of a fast-moving phone charger may take the old case at a small extra charge. Bundling protects the headline price of the good item while clearing the slow one. See how to raise spend per customer for basket ideas.
3. Return or swap with the supplier
Many distributors will take back unopened, in-date stock for a credit note, sometimes at a deduction, or swap it for lines that sell. Ask before you are desperate, keep goods in their original packaging, and get any agreement in writing. A credit note is worth less than cash only if you would not have reordered from that supplier anyway.
4. Sell in bulk, donate or dispose
Bulk buyers, market traders or online clearance sales can take the remainder at a low price. Where goods are near or past expiry, do not sell them: regulators act against expired food and drugs, and in February 2026 NAFDAC sealed 18 warehouses in Bida, Niger State, holding expired food and beverages it valued at over ₦100 million. Dispose of expired items properly and record the disposal.
A worked example in naira
Example only. An accessories shop bought 120 phone cases at ₦2,500 each (₦300,000). Six months later 80 remain, cost ₦200,000. The normal selling price was ₦4,000.
| Option | Cash or credit received | Shortfall against cost of ₦200,000 |
|---|---|---|
| Mark down to ₦2,000 and sell all 80 | ₦160,000 cash | ₦40,000 |
| Supplier takes back at 70% credit | ₦140,000 credit note | ₦60,000 |
| Bulk sale at ₦1,200 each | ₦96,000 cash | ₦104,000 |
| Keep waiting | ₦0 for now | ₦200,000 still tied up |
The markdown recovers the most cash here, but only if all 80 sell. The real comparison is the expected recovery under each option, and what the freed shelf and cash can earn instead.
How to record the loss: write-down under IAS 2
IAS 2 (paragraph 9) requires inventories to be measured at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs to complete and sell (paragraph 6). Write-downs are made item by item (paragraph 29) and recognised as an expense in the period they occur (paragraph 34).
In the example, if the cases will now sell for ₦2,000 and selling costs (say a ₦200 delivery charge per case) apply, net realisable value is ₦1,800 a case, or ₦144,000 for 80. Carrying value falls from ₦200,000 to ₦144,000, a write-down of ₦56,000 charged to profit this month. If prices recover later, IAS 2 allows the write-down to be reversed, but only up to the original amount.
For tax, PwC's Nigeria summary (reviewed May 2026) notes there are no special statutory stock valuation rules beyond accounting requirements, so the figure in properly prepared accounts is the usual starting point. Confirm the treatment of any large write-off with your accountant; see also valuing closing stock for your accounts and tax.
Stopping it happening again
- Review sales by item monthly, not just total sales.
- Buy new lines in small trial quantities before committing to a carton.
- Agree return or swap terms with suppliers when you place the order.
- Set a markdown trigger date for every seasonal item when it arrives.
- Rotate stock so older units sell first (see FIFO stock rotation).
Where Pryme fits
A Pryme Business Account comes with a Finance agent, built by Pryme Intelligence, that prepares work such as reports for a person to approve. Shops in supported sectors, including Grocery/Retail and Pharmacies, can also join Spaces, Pryme's merchant ecosystem, to reach customers who shop there.
Questions people ask
What is dead stock in business?
Goods you hold that have stopped selling at a useful rate, often with no sale for months. They tie up cash and space, and may need marking down or writing down.
Can I return unsold goods to my supplier in Nigeria?
Only if the supplier agrees. Many distributors accept unopened, in-date stock for a credit note or swap, sometimes at a deduction. Agree terms in writing, ideally when you order.
How do I write off expired stock?
Remove it from stock, record the cost as an expense in the period, and keep a record of how and when it was disposed of. Do not sell expired food or medicines.
Is it legal to show a 'was' price on sale items?
Only if it is true. Section 123 of the FCCPA 2018 bars misleading price comparisons with earlier prices, so the 'was' price must be one you actually charged.
Sources
- IFRS Foundation: IAS 2 Inventories (2024 issued text) · accessed Oct 2026
- Federal Competition and Consumer Protection Act 2018, section 123 (LawGlobalHub text) · accessed Oct 2026
- Nairametrics: NAFDAC seals 18 warehouses in Niger over expired food products worth N100 million, 20 Feb 2026 · accessed Oct 2026
- PwC Worldwide Tax Summaries: Nigeria, corporate income determination (last reviewed 29 May 2026) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.