it is more Detailed ref to this > https://www.odoo.com/documentation/18.0/applications/inventory_and_mrp/inventory/product_management/inventory_valuation/inventory_valuation_config.html

Hi,

Inventory valuation appears on your balance sheet based on the costing method you use—either AVCO (Average Cost) or FIFO Costing—and any currency adjustments. Here’s how each method impacts your balance:

1) AVCO (Average Cost):

• Provides a straightforward representation on the balance sheet.
  
• No valuation differences should appear.
  
• Easy to reconcile with inventory records.
  

2) FIFO Costing:

• Use the Inventory Valuation report to check FIFO-based values.
  
• Apply the “Remaining qty” filter to see transaction details.
  
• Product costs should average across these postings.
  
• In theory, this should match the balance sheet, but watch for Rounding differences, Currency conversion impacts, and Multiple receipt prices.
  

3) Currency Considerations:

• Goods receipt cost uses the exchange rate on the receipt date.
  
• Invoice postings might use a different rate.
  
• From Odoo V16 onwards, invoice cost differences automatically adjust product valuation.
  
• Expect minor rounding differences due to currency adjustments.
  

4) Key Differences:

• The balance sheet reflects the sum of all accounting documents.
  
• Product cost is calculated as total value divided by quantity.
  
• Slight differences may appear due to calculation methods.

Hope it helps