Stores Procedure
Stores Procedure
Stores Procedure
Course on
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Store Provisioning & Material Management
INDEX
SL TOPIC PAGE NO
1. Purchase Procedure 1
2. Forecasting/Planning of Direct/Indirect Materials 5
3. Tender Purchase Committee 8
4. IFD/Indent 9
5. ABC technique and Selective Control 13
6. Inventory Control 35
7. Import 37
8. Introduction to Stores - Salient Features 46
9. Store Functions 47
10. Stores Receipt, Issues, Stores Office Procedures 48
11. Disposal 51
12. Store Keeping 54
13. Issue of Stores 55
14. Stores Accounting Responsibility 55
15. Issue of Stores/Preparation of Documents/I.Vr. 56
16. Book Keeping 57
17. CRV, IV, Demand Notes 58
18. ABC Analysis 59
19. Stores Organisation & Control 59
20. Preservation 64
21. Biological Hazards 64
22. Stock Verification 67
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INTRODUCTION TO STORES:
Through it adds nothing to the value of the product, store keeping is an essential
function in any organisation. Stores is just an overhead for any organisation.
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STORES FUNCTION:
1. Identification
2. Receipt
3. Inspection
4. Storage & Preservation
5. Material Handling
6. Packing
7. Issue & Disposal
8. Stock records
9. Stores accounting
10. Stock control
RECEIPT:
Further:
(1) Ensure house keeping is OK i.e checking for spillage oils, dirty walls and any
obstacles.
(2) Check all the material handling equipment are OK.
(3) Report an accidents and dangerous occurrences (if any) and fill accident
register and arrange for immediate medical treatment as early as possible
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(4) Report to management utilisation factors, idle time working etc.
Desired degree of service at minimum ultimate cost can be made available to the
production/service shop by effective control of stores (known as inventory control)
taking following points into the consideration.
1. Systematic location
2. Storage
3. Recording
Main record of stores in stores section is maintained through bin cards. Another
record is maintained jointly by provision section and accounts are known as STORE-
CUM-PROVISION LEADGER.
According to the various functions involved, main stores is divided into the following
units.
1. Receipt Group
2. Stock
3. Issue
The receipt group as responsibly to receive a materials intended for the factory
against proper authority such as Firms Challan, Invoice, Railway Receipt (RR), Issue
Voucher, Registered Post Parcel, Value payable post (VPP) etc. Counting, measuring or
weighing, as the case may be by this group carefully checks up the stores on receipt. On
receipt of material, MIS (Material Inward Slip) are prepared in five copies within 24
hours whch are forwarded to WI (Works Inspection) along with stores for inspection to
specification and quality as stipulated in the supply order.
On receipt back of MIS from WI after inspection (if the full quantity is accepted)
receipt voucher number is to be allotted on MIS sent to stock for taking material on Bin
cards i.e stock charge). The receipt Data processing section/provision section. If there is
any rejection on the MIS after inspection, Discrepancy report (DR) should be raised on
the consignor factory in the Form No. IAFZ 3045 within one month from the date of
receipt off consignment. This reports (DR) are prepared in six copies-two copies for
consignor factory/dept one copy for consignor's A.O., one copy for L.A.O., one copy for
local planning office and the rest for office records.
Material in dispute will only be returned at the consignor's specific
request/agreement, in the absence of such agreement it will be retained by the consignee.
It will be used if useable; otherwise it is to be disposed in the usual manner.
AUTHORITY FOR ACCEPTING MATERIAL:
All materials are to be accepted based on:-
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i) Local purchase ii) Central Purchase iii) Foreign Purchase iv) Cash Purchase v)
One time buy (OTB) vi) Indent etc.
PLACES OF COLLECTION:
Collection of stores made by Receipt Group Generally from
a) Local items against supply order
b) Ordnance Dept/A.S.C (Army Supply against demand/indent
c) Sister Ordnance Fys against I.F.D
d) Govt. store Govt. stationary office against demand/Indent
e) Railway Yard/Godown/Station
f) Embarkation Hqrs incase of stores shipped by foreign supplier
a) One copy for office record b) One copy for record in WI c) Two copies for
accounts office d) One copy for Bill section for payment.
REGISTERS MAINTAINED:
For proper functioning of the following registers is maintained in the receipt Branch.
i) RR/PWB (parcel way bill)register.
ii) Wagon register
iii) Central record for incoming stores
iv) Discrepancy registers
v) Claim register
vi) Receipt voucher/guard file
vii) Dak book for incoming & out going papers.
STOP PAYMENT: Payment to supplier on the spot can be made only after inspection
and acceptance of stores by the authorised inspection.
ONE TIME BUY: The stores of non-recurring nature are purchased as one time buy.
These stores procured against transit ledger should not be taken on stock charge.
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a) Notice of inform for all claims should be served to Rlys (Chief commercial
Spndt/G.M) copy endorsing to the consignor in case of non arrival of stores
within 30 days from the date of booking.
b) Formal claim (Monetary claim) should be made with 90 days from the date of
booking in case of non-arrival of the consignment.
c) No claim shall be entertained by Rlys., if the claimant fails to submit his claim
within 6 months from the date of booking.
d) No claim can be made from the Rlys., if the value of the lost stores does not
exceed Rs.25/-
h) Ledger should be maintained by trained staff, who is well aware of the financial
aspects of the transaction for which the ledgers are kept.
Inventory of stores
a) Annual Inventory through stack verification group is normally being carried out
once in a year between 1 st April to 31st march and SV sheets are being prepared
to this effect for valuation.
b) Perpetual inventory of stores-whenever any receipt or issue is made the BCB (Bin
card balance) after positives reflected on the documents to cross check the qty
available after that posting. This will be called perpetual inventory i.e. to reflect
the stock at any item after every transaction.
c) Departmental verification by senior staff.
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ii) Phased supplies to spread over certain period to avoid overstocking/idle capital
and to conserve storage space.
Costing is one part of stores accounting so far as the production items are
concerned. For this purpose the ledger called "Priced Production Ledger" is employed
with the help of cost cards. Cost cards will show the materials used and the labour used.
Besides material cost. Labour cost over head charges like fixed overhead and variable
overheads are also charged to make up or arrive at the cost of the product i.e item
produced at the Factory.
DISPOSAL:
b) Disposal of raw materials used as well as unused to avoid over stocking / idle
capital
d) Disposal of material to sister units as stop gap arrangements only to re-call at any
time as the need arrives.
f) Retrieval of useful parts or salvage of useful parts that could be re-used and the
balance may be disposed of by any one of the methods stated above.
CODING OF UNITS
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SQ-METER 14 BOTTLE 60
SQ-CENTIMETER 12 PACKET 61
CU-MILLIMETER 21 BAG 62
CU-CENTIMETER 22 TIN 63
CU-METER 24 BOX 64
CU-DECIMETER 23 CARTON 65
LITRE 25 SKEIN(Qty of 70
Yarn)
HECTO LITRE 27 REEL 71
CENTIGRAM 32 ROLL 72
GRAM 34 CALORIE 73
DECIGRAM 35 MEASURE 75
HECTOGRAM 36 BAR 77
KILOGRAM 37 SET 78
METRIC TONNE 38 LOT 79
NUMBER 40 WHOLE JOB 80
DISPOSAL OF STORES
Disposal of stores is a complex job by itself. The purpose behind the concept
being to retrieve as much money (value) as possible for the surplus stores to the best
advantage of the state and at the same follow the norms stipulated by the state for such
disposal.
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G) Inability of the Factory/Unit to utilise the existing stocks.
H) Replacement of worn out machinery stores.
I) By mutual add-In such cases, circulars of surplus stores with all details to
all the Factories and priority indentures as listed in the DGOF circulars
V) Through DGS & D and through the local DGS & D offices located near
the Factory / Unit in case of capital items and high value items beyond the
value Rs. 10,000/-
VI) Destroying by burning, such of those classified and Top secret stores, but
under the direct supervision of a board of officers approved/appointed by
the state.
CLASSIFICATION OF SURPLUS/DISPOSAL
1. Standard stores that could be used by all. For e.g. M.S plates/Sheets/Bars.
Blooms. Billets. Mild structural materials like MS Angles. Channels. I-beams etc.
Special steel materials stainless steel bronze, Brass and Aluminum Materials.
2. Standard machine Tools like Lathe Milling, Broaching, Drilling, Center less
Grinder and Tool Grinder etc.
3. Standard misc. items like Ele, bulbs, cables, cloth, unused Timber, oils, paints,
cement etc of consumable nature.
4. Special stores such of the stores procured specifically against specific production
requirements which are peculiar only to such production job and which cannot
be used by others. This can also be said as non-standard items the usage of which
is restricted to certain productions only.
5. Scrap materials like steel turnings and borings. MM scrap, HM Alloy scrap
(steel), Brass, Bronze, Aluminum, Misc, Scrap used oils, used Timber., used
barrels, Jerricans etc
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Normally while fixing the reserve price for the auction for negotiated sales. Sales
to priority indenters, the last auction price shall be taken in to consideration. Also the
book value of the items shall be taken in to consideration. The GMs of Factories in
liaison with the local Accounts officers can fix the price for such stores subject to the
limitations specified in DGOF's circulars from time to time. In case of dispute between
the GM and the Accts. In fixing of the prices. The matter shall be preferred to DGOF.
STORE KEEPING
b) The Bin cards will contain the LF No, Nomenclature. Accounting Unit, Location,
Minimum Level, Danger level & Maximum levels as well ato guide the material
division of the inventory control. Min level, danger level and maximum levels will
be given by the respective material divisions for endorsement on the Bin card.
c) Basically the stores are classified and codified into convenient groups blocks for
accounting purposes.
d) Once the stores are received, they are binned and Vrs cleared to all concerned
with the "Bin card Balance" after that posting.
e) Care and custody of stores in also part of store keeping. Hence periodical
preservatives, turnover, issue of first in first out is also part of this duty.
f) Bulk-handling of stores
Where there is bulk of stores involved a percentage 10% or 20% will be physically
verified for Qty/Quality and on the basis of test certificate/1. Note, the data obtained on
the percentage check will be utilised to clear the bulk of stores while under receipt or
under issue.
B) LEDGER KEEPING
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v) Issue voucher
vi) Demand notes
vii) CIVs / CRVs
viii) Transfer vouchers
b) Ledger sheet which will contain Nomenclature, LF No, A/C code, Qty, Unit cost,
Total value, source of receipt, to whom issued, work order No, warrant No etc
and the balance at any one time in qty and value.
c) Ledger sheet is the basic record from which the value is taken and the balance
sheet, profit and loss statements and also prepared. This is a very important
document, maintained by the accounts and will contain all the information
required for any transaction whether 'Receipt' or 'Issues'
ACCOUNTING OF STORES
i) Store keeping
ii) Ledger keeping
iii) Inventory control
iv) Costing
v) Disposal
Responsibility of the above functions are divided between various section either
jointly or alone.
STORES ACCOUNTING
RESPONSIBILITY
Cost Disposal
ISSUE OF STORES
GENERAL PROCEDURE;
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The ultimate of any production unit is "delivery of goods to the consumers or the
concerned at the right time, at right place the right material as efficiently and as quickly
as possible. This is the case with all the Ordnance Factories in 'delivering the goods to
the Defence Forces / Defence Dept. it is the quantum of the Goods delivered (issued) that
is recognised in the over all performance of the Factory. Hence "Issue of stores" is a
very important function of Ordnance Factories and to effect the ISSUES, certain norms
are laid down are evolved by experience and commonsense.
j) An indent from the Army, a demand from other Factories a requisition from
other units or firms specifically indicating the requirements and delivery
schedules.
ii) Acceptance of the indent / demand/ requisition and proceeding the camp for
production by release of orders on shops and advice to stores on the made of
despatch and schedule of despatch. This will be the authority for issue.
iii) Release of material /stores for issue against specific workorders. Besides
authority for issue a release from PC/MC/PV is essential in all cases to
provide required materials.
v) Preparation of ISSUE documents like Issue Vrs packing notes, forwarding notes,
export documents etc as the case may be.
vii) Despatch of stores as per the authority, as per made of despatch advised, freight
paid or to pay.
viii) Despatch documents to all concerned in time to clear the consignment and
also release the Issue vouchers with all despatch details to PC/PV/Accounts.
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b) Preparation of Issue Vouchers
Having received the documents cited above and having decide the type of issue
involved the IVr will be prepared on IAFZ-2096. The issue voucher will contain the
following information IVr no and date consignee's reference LF no if any,
Nomenclature, Qty in figure and words, as brief as into why issued and how issued,
packing details and despatch details. The issue voucher will be signed by an official not
less than the rank of store holder or Asst. Manager.
In case of 'P' Vrs demand note for the stores also will be released by the PC/MC/PV
which will be signed and delivered at the stock Godowns. The stores will be collected
and labeled and sent to Issue bond packing area.
In case of stock items the items will be collected against the issue voucher at the
respective stock godowns, labeled and sent to issue bond packing area. The same applies
to nominal loan and nominal issue also.
BOOK KEEPING
Introduction:-
Purchase Records:-
This is the basic record authorising the purchase to initiate provision action as
per details contained in it. This is maintained by the provision/purchase section
(Material Division).
ii) Tender Enquiry folder, which is later converted in to a supply order folder:
This record would be very essentials from the audit point of view as the basic
record for effecting payments for the stores purchased. This record is to be kept number
wise and year wise for o5 year from the date the PDC and is avital record often required
for reference. At times in disputes over payments by the firms, the record is often called
of by the courts of law. Pre audit before release of the supply order or post audit of the
supply is very essential.
These charts are the control charts indicating the entire procurement and control
of issue there of, of each and every item, but for this sheet, it would be impossible to go
for purchase / procurement action. This chart will give the quantity required for any
period the phase of procurement, the phase off distribution to the shops, dues in both
dates.
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The bills are auditable documents and are booked to the supply order, receipt
vouchers released by the stores for effecting payment to the firms. The bills are
submitted to the accounts section only after the supply order folders are audited and
cleared by the Accounts. The bill register and the bills are subject to test audit as well.
The bills are to obe maintained number wise and year wise for TEN years or final bills
are paid/cleared.
v) Stores Record
Material Inward slips (MI SLIP) which are prepared with reference to the supply
order, one for each item and its packing materials. MIS will be converted into Inspection
report after the MIS, the stores are inspected and cleared by the inspection department
and at this stage it is controlled as receipt voucher and passed on the stock Group /
Godowns for collecting the materials, binning and posting in the Bin cards and
thereafter releasing the receipt voucher to concerned sections. Receipt voucher is an
auditable document and controlled by analyst called receipt voucher controlled register
by the record Group of stores. Receipts are also indexed in each supply order folder at
the bond and through progress sheets are kept number wise and year wise in the records
room. It is essential to keep all the receipt vouchers for FIVE years for reference.
Vouchers which could not be directly linked to any document at the same time
required to account for certain stores to pass through the ledger. These vouchers are
kept with the regular receipt vouchers in the record room.
Return Notes:
Just like demand notes the return notes are prepared by the shops / PC to return
to stock group. The return notes are also auditable documents and are to be signed by
the inspection authority to ensure the serviceability of stores. This should be routed
through PC/MC which released the materials for production. One copy is filled in the
record room.
This is one of the very vital stores document. It is prepared by the receipt group
of stores division, whenever any discrepancy / deficiency in the quantity is noticed. Full
text of the circumstances leading to the discrepancy deficiency is to be recorded in the
body of the voucher for correct assessment of the deficiency. A register is maintained in
stores for this purpose, which controls the DD vrs prepared and separating in the same
register as art-II for losses incurred. In case of losses a certificate authenticated by the
accounts officer, recommending of the intermediate officer and the final order of the
GM or DGOF as the case may be is recorded.
DEMAND NOTES:
This is the authority to draw stores from the stock group. Demand notes are
released by PC/MC group for production items. The demand notes are to be presented
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only at the time of drawal of respective bincards. It is essential to keep the demand notes
for five years. It is an auditable document.
ISSUE VOUCHERS:
(IAFZ 2096) Issue vouchers are prepared by the issue branch of for all issue to
outside. The issue vouchers are normally prepared only on specific authority of CP/MC
section clearly indicating the purpose for are made. For stock items 'S' series vouchers
are made. For nominal transactions 'NL' vouchers are made.
The CIVs are prepared in case where the issue could not be directly linked up to
any documents or records basically to change if the stores CIV is prepared. This is an
auditable document.
Finally it is the scope of the paper only to highlight the importance of these
documents so as to keep proper record of it. Which should be record keeping for the
prepare Accounting of stores.
A.B.C.Analysis
Analysis of all stores items representing the entire inventory in terms of annual
consumption of each in rupee will reveal 10% of the items will represents for about 80%
of the total annual consumption cost., 20% of the items will account for about 15% of
the annual consumption cost, while balance 70% will cover only 5% annual
consumption cost =100%. The small number of high consumption value items are called
'A' items, the medium consumption value items are 'B' items while the large number of
items whose annual consumption value is very low are 'C' items -ABC analysis does not
depend on the unit cost of the item, but only on its total annual consumption.
STORING SYSTEMS:-
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2) Open store system.
In this system all materials are physically stores in closed or controlled area. As
per rule no one other than stores personnel is permitted in the store area. Materials
enter and leave the area along with accompaniment of an authorising document. This
system is designed to offer maximum physical security and to ensure tight accounting
control of the inventory materials.
In this system no store room as such exists. Each materials is stores as close to its
point of use as is physically possible. Storage facilities are completely open and any
worker has access to this storage facility.
Ordnance factories follow closed stores system. The stores are received and
issued by the stores on proper authority only. However bulky materials such as steel,
billets required in large quantity may be stores in open near the production section to
minimize the handling.
STORAGE SPACE:
While planning for storage the following points are to be taken care of:
In the Present days facilities are used in most of the cases for receipt and issued in
most of the cases for receipt and issue of bulk of the items. Railway tracks are laid inside
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the Factory where factory locomotives can directly take the wagons. No. of
platforms/hand stands are constructed according to the requirement of
wagons/Loaded/unloaded on day to day.
Transportation:
VII. Collection and despatch of items from contractors premises and other
sister factories, Embarkation Commandant etc.
Weighing Arrangements:
Wagon Weigh Bridge, Road Weigh Bridge and Weighing scales are to be
provided for weighment of incoming materials.
Due to heavy cost of storage space, It is essential to make the stacks higher.
Similarly it is essential to use minimum man power for unloading / Loading, stacking
and transportation to achieve economy. Hence handling equipments and accessories are
planned and used depending upon the requirements.
RECEIPT BRANCH:
For convenience, the receipt branch has been divided into receipt office and receipt
Bond. The functions of both the groups are as under:-
c) To put up material for Inspection and provide necessary facilities like providing
samples etc. to inspection.
d) To prepare receipt voucher on clearance of MI slip and inform all concerned for
further action.
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e) To regularise quantitative discrepancies by preparing:
i) Expense voucher.
ii) DD voucher for discrepancies as receipt
iii) By preparing claims on Railways / Transporters.
iv) DD voucher and loss statement for transit loss.
STOCK BRANCH:
1) Regular stock: For which L.F.S are existing. This includes production and non-
production items.
2) Deposit stock: These are stores held deposit in the factory on behalf of Air
Forces, Navy and Armed Forces in repaired on conversion for ultimate utilisation
in manufacturing.
3) Stock pile stock: Strategic items or stores which are difficult to procure in case of
normal supplies and are of non-perishable nature. It should be of imported
origin. Value of the item should be above Rs.5000/-
c) Issue against authority of D/Notes, Issue voucher and post these issued in bin
cards.
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g) Raising examination orders for items sent outside the factory in case of mix - up.
h) Stocking of items lot wise taking care of expiry period etc, incase of some specific
items like grinding wheels.
ISSUE BRANCH:
This group deals with the issues made outside the factory only. Issues are make to
sister Ord. factories, depots, private firms by factoroy transport, Rail, Air Sea etc.
Main function:-
I. To issue materials by full wagonload, full Turk load, and post parcels,
part Turk load, part wagons load etc., after making RR/Despatch
documents.
control:- Stores should continuously identify, analyse and isolate items into:-
I. Feedback on these will increase the awareness of the management towards better
inventory Management.
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II. Need to cut down the paper work / office procedure and thus internal lead time
can be reduced. This in return will reduce the buffer stock.
III. A.B.C analysis can be applied and 'A' category items can be given priority right
from receipt stage till it reaches stock stage. Different colored documents can be
utilized to identify 'A' category items.
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PRESERVATION
INTRODUCTION:
In Indian Industries the Material is represented as 60% of the gross out put of
the goods. In Ordnance Factories the cost of the material works out to 67% to 69% of
the cost of the production. Even 1% saving in material cost will be of great saving.
Preservation of stores plays a vital role in minimizing the deterioration and spillage with
the result the material available is in fully serviceable condition as and when needed by
the production / service section.
IMPORTANCE OF PRESERVATION:
BIOLOGICAL HAZARDS:
These are caused due to living organisms like rodents, silver fish, moth, insects,
fungi or bacteria, rats mildew and ghoons etc.
CLIMATIC HAZARDS:
BIOLOGICL HAZARD
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Climatic Hazards:
Can be prevented by creating a barrier between the article and the surroundings.
For e.g some coatings like zinc coating, wax coating etc., given over the article.
CAUSE OF CORROSION:
All metals with the exception of the metals, such as gold or platinum are subject to
corrosion, the difference between them is an the degree and rate of corrosion. In all
cases, the eventual destruction of a product is inevitable unless protective measures are
taken.
About 70% of all instances of corrosion are due to reaction of metal with moisture
and oxygen from the air. Taking iron as an example: 2Fe+H2o+O2+Fe2O3+H2
This type caused by the reaction of metals with acids is more severe and is generally
caused by the corrosive fumes in the atmosphere or various chemicals on the surface of
the metal. The chemicals present react with moisture and form traces of acids that
attack the metal. These metal acid products react with more moisture to form the metal
hydrates that finally decompose leading to corrosion.
Another accelerated process of corrosion occurs when metals react with salt water or
salt atmosphere. Particularly salt spray from the ocean. Salt being hygroscopic, picks up
water from the atmosphere and holds it to the metal surface, where it acts as a catalyst
to promote corrosion.
The metal parts, subjected to rust or corrosion should be stored indry area they may
be covered with suitable rust inhaviting compunds.
The different types of storage / Preservation method for different materials in the
Annexure 'A'.
Annexure 'A'.
3. Cement: Supplied in gunny, paper or cloth bag. Gross wt being 50 kgs should
stored in weather tight godown. Dampness will cause setting.
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4. Castings: Cast iron casting improve by ageing in atmospheric temperature. Steel
casting may remain in open with a cost of paint to ensure that these do not rust.
5. Machined parts : Castings with machined faces may be dept outside but the
machined faces, particularly threaded portion and holes to be protected properly
with grease, plugged where necessary. Journals should be packed with wooden
9. Timber: Wooden sleepers stacked should have end clamps to prevent and
splitting. 2) Coal tar is preventing for white ants. End of pieces are coated with
coal tar. 3) Timber and plywood are stacked over pillar type dunnage the top of
the stacks to be covered.
10. Rubber goods: Separate godown with low room temperature (16 deg to 20 deg C)
afairly high humidity and complete darkness is suitable. During periods of very
low humidity i.e during dry summer care should be taken to maintain high
humidity. Tyres should always stand on end. Tubes should be wrapped in
greased paper dusted with French chalk. Don’t keep stock fomore than 6 months.
Sunlight has adverse effect through antinitic rays. Keep away from grease or oil
11. POL ITEMS: Depots for POL items should be sited on reasonably leveled hard
ground. The site should be well drained. The fire caution arrangement should be
provided. Only one item should be stored in one stack. The drums should be leak
proof. First in first to be followed.
12. Leather stores. The leather goods deteriorate due to drying fungal attack,
termites and rates attach. To prevent drayage, the leather should not be exposed
to sun. it should be periodically treated with authorized preservative and
properly wrapped. Wet leather should be wiped with dry cloth and aired under
shad. Leather to be treated with 1% parantitophenol in methylated aprit to
protect against macro organisms. Soad laundry is the authorized preservative
where stiffness rigidity is required.
13. Optical Instruments. The Moisture in air forms condensation on lens or the
optical instruments. To prevent items, silicacel in small packets is kept along with
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the optical instrument and the entire unit is heat-sealed. These are then packed in
Thermocoal boxes and kept inside A/C Rooms.
14. Cotton and woolen Fabrics: Moisture and water are harmful. Store in steel
Almirah, 1.5 meter wide wooden goods, felt, should be wrapped with paper. Rats
and white ants are destructive agent. Wooly bear, moths silver fish are harmful
for whool. Insecticides should be sprayed.
15. Coal: should be piled in rows of slacks, preferable not over 3 metres length and
30 metre wide at the base, each pile being preferably not in excess of 1,500,000
kgs. Clear space of 3 metres to be maintained between piles. Should not be
slacked against wooden posts nor in touch with or warm pipes or flues. Shunting
pilets should not throw sparks.
CANNALISED ITEMS
The items canalised for Import through public sector Agencies have been shown
in Appendice 5 of Import & Export policy 1984-85.
APPENDIX 5-A
CANNALISING AGENCY ITEMS
1. Minerals & Metals Trading Corpn. Platinum, sulphur, Aluminium,
Of India (MMTC) Antimony Asbestos, Copper,
Zink, Lead Tin & Nickel
2. State Trading Corpn., of India (STC) Chemicals like Calcium, Borate,
Vinyle, Acitate sodium, polyster
filamentt yarn, Natural rubber,
writing & printing paper DDT,
Cuprolactum, Viscose filament yarn.
3. Steel Authority of India Ltd., SAIL Pig Iron, Corbon Steel Alloy Steel
4. Electronics Trade & Technology Calculator, chips Tc picture Tubes,
Development corporation ETTDC CRTS for TV sets.
STOCK VERIFICATION
These are verified annually by SVG. During verification the balance of the
documents should tally the ground balance. If any discrepancies found that will be
endorsed by Stock Verifier in Red Ink. Discrepancies can be settled only with CRV/CIV
as the case may be.
Production shops should enter on Inventory Register, the items drawn by them.
Which will be verified by Stock Verifier periodically. The responsibility of the verifier is
vast such that he has to verify each and every item whether it is movable / immovable /
portable. Verifier is the authorised person to verify the Assets of an Organisation as per
the record maintained from time to time.
In short the following documents are maintained for verificatin purpose.
1. Capital Register'
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2. Furniture / Office Equipment
3. Tools & Gauges
4. Miscellaneous Items
No. of registers can be as per the Volume of Items dealt. In any case a Register
cannot exceed 100 pages per Volume. Which should be duly numbered and enforced
with a certificate from Head of Section and Accounts as per Specimen. Stock verification
is a statutory requirement of a factory. Departmental stock verification will be carried
out in factories by the independent D.G.O.F Stock verification organisation. In addition
to but not concurrently with this stock will be verified by factory staff. If any
discrepancies, the matter will be referred to the G.M of the factory as early as possible
for necessary actions endorsing copies to A.O. duly signed by the concerned section
representative. Stock verifiers posted at the factories will be under the G.M./Officers in-
charge for all ordinary administrative purposes and will normal factory working hours
as observed by stores section. They are independent, so far as their work is concerned
and each individual will be responsible directly to D.G.O.F. Senior stock verifier at each
factory who in addition to performing his share of stock taking, will liaison with the
factory management, the local Accounts Officer and D.G.O.F.
Note: Verification of finished articles on charge on production ledger cards and stock of
materials in process of manufacture held by the shops will not be their responsibilities.
Responsibilities of senior stock verifier: Collecting & distributing instruction
information and reports.
C) Drawing up the programme of stock taking.
D) Allocating the work among stock verifiers.
E) Maintaining progress details.
F) Reporting with details to O.F. Board when work is falling or is likely to fall,
behind planned programme.
Stock verifiers will not give advance intimation to the factory of particular items to
be verified on any day/days.
Factory representation:
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Assistance:
All labour and equipment needed for proper verification will be supplied by the
factory as required for the work.
Difficulties:
In difficulties in connection with verification of any item should be brought to the
notice D.G.O.F Verification cycle procedure and maintenance of report.
Record:
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and the items enumerated thereon will be verified at more frequent interval and
these lists to be approved by O.F. Board.
c) List of certain items will be consultation with the Factory Management and the
items enumerated thereon will be verified at more frequent interval and these
lists to be approved by O.F. Board.
d) List of stores Ledger Folios which have shown a nil balance (regarding both
quantity and value) continuously for at least two years and on which no
transactions have been recorded during this period, will be submitted by the A/C
Officer to the management (Fy) who will scrutinise the items and select those
which are to be considered as "dead", i.e. store unlikely to needed in the near
future. These will be intimated to the Account Officer for removal of the folios
from the current ledger, and the factory also promptly remove corresponding
Bin Cards.
e) Inventory articles, Machinery, Building, Electrical Installation and Medical
Service will be verified once in each financial year.
f) In order to keep stock verifiers fully posted as to the amount of work to be done,
Factories will notify them of all new items and also those detailed, in respected of
stock ledgers and the other registered involved.
Stock-taking sheet:
Stock verifiers will enter the date serial No. Nomenclature, L.F. No. Stores
Accounting unit and Bin card or Inventory balance on date of verification. Balance
found a physical check and date of last verification. Each sheet will be signed by the
stock verifier and the associated Fy. Representative.
Method of verification:
It should be obtained for the modified method before stock verification is actually
carried out.
b) New Receipt - The stock verifier will be informed of all new Receipts, which will
be weighed/measured in this presence and stocked a part from the old stock, in
such a manner that he can take measurement to guide him a future stock
verification.
c) Continuous tock taking - will be carried out departmentally, S.V. Group will
verify every item once a year or in two years according to the nature of the stores.
d) Stock-taking of Coal - Coal will be weighed in on receipt and stock in units of 500
tons and stock will receipt and stock in units of 500 tons and stock will be suitable
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marked with while bands and a certificates as to correctness of the quantity in
each stock will be furnished to the stock verifier when required.
e) Stock taking of Soda, Nitrate, Cotton Waste etc. will be weighed in on receipt in
the presence of the stock verifier and stacked in lots of convenient size. Lot will
not be disturbed or re-stocked in a different from that is which it was originally
stacked. If it should be necessary to do this, the bags or bales will be counted
again in the presence of stock verifier.
Stock Taking of Textile Materials:
a) A test check not exceeding 5% of the stock will first be conducted and the contents of
the remaining packages accepted in accordance with package making.
If wide variation is observed in first test, a second and third test check not exceeding
5% of the stock from a different lot will be conducted in each test.
If wide variation is observed in all the three test check, the matter will be reported to
the G.M. for necessary action.
Computed verification - Lists will be maintained for items which are not actually
counted, weighed or measured with conversion factor recorded for each item. Details of
exact method of arriving at the conversion factories will be recorded, including the
number of samples counted/weighed/measured, the number of such checks, variation
etc. duly certified by the senior Stock Verifier.
Inventory Register - Each sheet of the Register will bear the initials and dates of the
Stock Verifier and number of item checked.
Medical Stores Register - Stock verifier will enter in red ink the balance found in
physical verification by him on the day of stock taking.
Addition and Alteration - All amendments to original entries will be made neatly and
attested with initial and date.
Internal Verification:
In addition to but not concurrently with the regular stock verification carried out
in factories by the DGOF stock verification organisation, at least 10 percent of the total
items of stores stock will be verified by factory staff as an additional check. The items
selected should be those which are costly per unit, those frequently received and issued
and easily salable in the market and in general, where past experience shows the
desirability of greater vigilance.
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