How do I determine the Opening Stock & Closing Stock value for the tax reporting?
By the time of setting up your new book, you put in creditors' opening entry amounts by entering all of the historical purchase bills accordingly and respectively added on items into the Stock Asset account, you will have to adjust the value of Stock to tally with your Opening Stock value. Since the total amount of creditors' opening entries are not theoretically representing the Opening Stock amounts. Then it is agreeable to point the Stock Adjustment amount to the Opening Balance Equity account instead of other expenses/income account.
In such a case, the opening stock is considered to have been added into the Stock Asset account which is allied with the Purchases account.
Therefore the Opening Stock amount for tax reporting purpose shall be able to ascertain (minus out from) the Purchases account.
During the financial year, you have entered all bills from creditors, thus have also add in all the stock items. That means the Purchases account has already been added up those unsold stocks.
Therefore the Closing Stock amount for tax reporting purpose shall be able to ascertain (minus out from) the Purchases account too.