A system of record is the authoritative source of some piece of data that the overall system cares about.
A fun thought question: If you’re building an inventory tracking application, what is your system of record?
I’d wager that the warehouse is the system of record. If the application you’re building doesn’t have an explicit workflow for when the system of record disagrees with the representation in your database, you’ll likely have a bad time.
Or you could always YOLO it. That’ll probably be more exciting.