This guide explains the difference between Current Cost and Historical Cost as used in Munch reporting. It helps users understand which cost method to apply in various operational and financial contexts, ensuring accurate stock valuation and reliable gross profit (GP) reporting.Report Page
Current Cost Price is the latest cost of an item based on the most recent goods receipt.
You bought Milk at R10 per liter last week. Today, the supplier charges R12.
Current Cost Price = R12 (even if you still have stock bought at R10).
Historical Cost Price is the original cost of an item at the time you bought it. It reflects what you actually paid when the stock was received.
You bought Chicken at R50 per kg in February. In March, the price increased to R60.
Historical Cost Price for February = R50
Historical Cost Price for March = R60
| Current Cost | Historical Cost | |
|---|---|---|
| Definition | The latest cost of an item in the system today | The cost of an item at the time of each sale |
| Used For | Valuing current stock on hand | Calculating accurate Gross Profit (GP) for a closed period |
| Cost Source | Pulls from the latest cost price per item | Pulls from the price recorded on the date of movement |
| Inventory Valuation | Reflects today's replacement cost | Reflects what was actually spent at the time |
| GP Reporting Accuracy | Not reliable – may over/understate GP due to price changes | Reliable – matches actual costs incurred per sale |
| Example Scenario | Tomatoes are now R10/kg – all stock is valued at R10/kg | Tomatoes sold on 1st at R8/kg and 15th at R10/kg – both are accurate |
| Best Use Case | Live operational reporting and stock value snapshots | Financial reporting, audits, and historical reconciliation |
| Impact on Reports | May change over time as prices are updated | Fixed once recorded – ensures consistency |