When an inventory tracked item is sold it automatically decrements the stock level for that inventory item. If that item is then refunded it will not be added back into stock.
Standard Refund Procedure
There are two processes to follow when refunding an item for an inventory tracked product.
Perishable / Broken Item
These items tend to not need to be placed back into stock and often are just discarded. In this case, once the item has been refunded, the staff member does not need to do anything.
If on refund the item needs to be re-stocked then it should either be processed immediately, or left in a list to do in batch over (or at the end of) a working day. When the item(s) is ready to process then follow the invoice procedure detailed here - https://getshopwave.zendesk.com/hc/en-us/articles/203992991-Stock-Invoices.