Actually, the balance is off every month.

For example, today, inventory account 1300 shows a balance that is $13,000 higher than the IC/Item Valuation using the date Feb 27, 2010. If I look at the balance of account 1300 balance as of Jan 31, 2010 it is $31,000 higher than the IC/Item Valuation using the date Jan 31, 2010. Account 1300 balance on Dec 31, 2009 is $67,000 lower than IC/Item Valuation using the date Dec 31, 2009.

There must be something I'm not understanding?

1300 has entries as you described from OE (product that was sold or returned), IC (inventory adjustments) & IR (product received or returned to vendor). No other module posts to 1300.

I would have thought that the "actual cost" total given in IC/Item Valuation on a given date would equal what account 1300 says for the same date?

*confused*