SARI PRESENTATION STORES PRCED. & ACCOUNTING-Paul
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Transcript of SARI PRESENTATION STORES PRCED. & ACCOUNTING-Paul
COUNCIL FOR SCIENTIFICAND INDUSTRIAL
RESEARCH
STORES/INVENTORY MANAGEMENT26TH JULY, 2016
PAUL FABALONA, CA, MBAHEAD OF CORPORATE FINANCE
INTRODUCTIONAccounting for Government Stores
CSIR/Government stores are made up of supplies of consumable and non consumables which are received, stored and available for issue.
Features of CSIR/Government store are
They are physically visible
They are movable
They are available for use
Exclude scraps, obsolete and unserviceable item.
INTRODUCTIONCSIR as a public organisation must
maintain a system of control over the ACQUISITION, RECEIPT, CUSTODY, CONTROL, ISSUE and DISPOSAL of Government stores.
DUTIES/RESPONSIBILITIES OF PUBLIC OFFICER IN CHARGE OF STORES
Public officer in charge of stores has the following responsibilities: To exercise general control over all activities in Stores Section
To ensure safe keeping both as to quality and quantity of materials.
To maintain proper store records such store ledgers, bin cards etc
To initiate purchase requisitions for the replacement of stock of all regular stores items whenever the stock level of any item of store approaches the minimum limit fixed in respect thereof.
To initiate action for stoppage of further purchasing when the stock level approaches the maximum limit.
DUTIES/RESPONSIBILITIES OF PUBLIC OFFICER IN CHARGE OF STORES
To check and receive purchased materials forwarded by the receiving department and to arrange for the storage in appropriate places.
To reserve a particular material for a specific job when so required.
To issue materials only in required quantities against authorized requisition notes/material lists.
To check the book balances, with the actual physical stock at frequent intervals by way of internal control over wrong issues, pilferage, etc.
To restrict access by an unauthorized persons.
Report all losses, damages and shortages to the Director.
RESPONSIBILITIES OF HEADS OF DEPARTMENT FOR STORES
•HODs/Directors are responsible for the general management and accountability for government stores.
•HOD may delegate store functions to an officer, called “store keeper”
•However, HODs remain accountable for stores in his department from the time of purchase to the time they are no further in use or value to government.
POLICIES AND STANDARDS The IPSAS 12 shall be used in accounting for
inventories. The CSIR shall use IPSAS as guidance on the determination of costs and its subsequent recognition as an expense, including any write-down to net realizable value
LEGAL FRAMEWORKThe management of stores in CSIR
shall be carried out in compliance with Part IV (i.e. Sections 30-37) of the FAA 2003, Act 654 and PART VI (I.e. Sections 181-183) of the FAR 2004.
PROCESSES AND PROCEDURESDOCUMENTATION
The following documents shall be used to effectively and efficiently manage the inventory processes and procedures.
Inventory Master Items Listing
Stores Receipt Advice/GRN
Inspection Report
Stores Issue Voucher
Purchase Requisition
Purchase Order
Tally (Bin) Card
Stores Ledger
Stores Accounting There shall be proper control of stock issues and the
supervision of stock accounts, approval of maximum, re-order, and minimum stock levels, record of requisitions on stock unfulfilled or outstanding at any time and record of all orders placed for re-stocking.
These are very necessary to ensure that scarce resources are not tied up in excessive stocks over and above departmental requirements while also ensuring that stock-outs do not occur to disrupt the smooth discharge of the business.
Establishment of Minimum Stock Level The minimum (safety) stock level shall be determined
for every store as the level below which purchase requisitions must be initiated to replenish the stock of consumable items, to ensure that Institute’s business is not disrupted.
calculate the minimum (safety) stock level for their respective stores as a percentage of estimated demand for the inventory item or as a mean deviation of demand for the inventory item.
ESTABLISHMENT OF LEAD TIME The lead time is the average time (in number of days)
it takes to replenish stocks from the moment the need for an order is established to the moment the inventory item is purchased, received and inspected, and conveyed to stores as available for use.
RECEIPT TO STORESOnly authorised stock purchases covered by
POs, waybills, VAT invoices should be received into store.
Stock deliveries shall be inspected and checked for quantity and quality before accepting into store.
RECEIPT TO STORESThe Head of the inspection team shall issue an inspection report, which would detail whether the goods supplied are satisfactory, unsatisfactory, or short delivered.
The inspection report shall be distributed to the following:
Head of Stores, & Procurement;
Head of Finance;
Storekeeper; and the
User Division/Unit
STORES RECEIPT ADVICE The Head of Stores shall then issue a stores receipt
advice (SRA)/GRN signed by him and countersigned by the Head of the inspection team in triplicate for distribution as below:
First copy to Procurement Unit;
Second copy to Accounts/Finance Division; and
Third copy to be retained at Stores.
The Storekeeper shall update store records (i.e. store ledger and tally cards) with all additions of stock to give the true stock position of each consumable item held in store.
ISSUE OF STORESThe following procedures should be followed by the Institute for issues of stores:
An Internal Requisition Form (IRF) shall be filled and signed by a responsible Head of Division or Unit authorised to do so.
The IRF shall require the approval of the Head of Finance before issues can be made out of stores.
The Head of Stores shall advise on quantities to be issued, which shall also be in line with approved procurement plan for the CSIR.
The quantities of consumable items issued out of stock by the storekeeper must be covered by a Stores Issue Voucher (SIV), which must be signed by the storekeeper and COUNTERSIGNED BY THE REQUESTING USER.
ISSUE OF STORESThe signed SIV shall be distributed as follows:
First copy to User Unit;
Second copy to Accounts/Finance Division;
Third copy to the Head of Stores;
Fourth copy retained by the storekeeper
The Storekeeper shall update store records (store ledger and bin/tally cards) to reflect the issue of the consumable items to the requesting user/unit.
The Head of Accounts/Finance shall make the relevant accounting entries in the requesting unit’s accounts in accordance with CSIR journal entries.
Stock TransfersStock transfers could occurred under the following:
Intra-Unit/Centre/Section Transfers
Intra-Division Transfers
Inter-Institute Transfers
Inter-Departmental Transfers
Stock TakingA half-yearly stock taking shall be conducted by the Stores Inspectorate Unit or Internal Audit for the Institute to verify the physical existence of stocks under the following information: Actual stock quantities held; Unit prices; Value of stocks held; Description of stocks; and Condition of stocks. A report on the stock taking shall be prepared and
submitted to the Director of the Institute and the Head of Stores and Accounts.
UNSATISFACTORY AND DEFECTIVE GOODS
Where goods are found unsatisfactory in terms of being defective, improperly specified, or with different prices other than the price quoted on the PO, the Inspection Team shall reject the order immediately without accepting them into stock.
SHORT DELIVERY Where goods are short delivered compared to the
quantities as specified on the PO, the Inspection Team may accept partial deliveries subject to supplier’s commitment of fulfilling the remaining order based on the same terms specified in the PO.
The Head of Stores shall prepare claims in respect of any shortages from a supplier before payment is made.
DISPOSAL OF STORESProcedures for disposal of stores:
Head of entity (DG) shall convenes a board of survey made of representative of affected Institute including experts outside CSIR .
BOS conducts an assessment of the store and makes a technical report recommending the appropriate method for disposal
HOD/Director receives the BOS report and gives approval
Stores are disposed of accordingly.
(PPA 2003, Act 663. s83)
DISPOSAL OF STORESMethods of disposal of store include:
Transfer to other CSIR Institutes, with or without financial adjustment;
Sale by public tender to the highest tenderer, subject to reserve price;
Sale by public auction, subject to a reserve price;
Sale to public at an authorised valuation; or
Destruction, dumping, or burying where appropriate
(PPA 2003, Act 663. s84)