Slow-moving inventory can continue to take up space even when its sales chance has reduced. Only observing the price paid is not enough: one must ask what conditions will enable the value to be recovered and what costs will still be necessary.
IAS 2 provides, for those who apply that standard, measurement at the lower of cost and net realisable value. The accounting reference does not replace the commercial analysis, but clarifies why historical cost and recoverability may differ. The applicability of the standard should be verified for the undertaking in question.
I propose to distinguish seasonal, continuous and damaged products. One slow article may wait for a later occasion of use; another may have lost its appeal in a lasting way. Decisions about discounting, transferring or exiting the assortment therefore require different information.
Recovery also comes at a cost: preparation, transportation, and sales management can reduce the revenue available. The periodic inventory review should link age, conditions and realistic alternatives. Eliminating a stock without correcting the cause of excessive purchases only solves part of the problem and leaves open the possibility that it will happen again.