Winter Report (1)

7/28/2019 Winter Report (1)

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DETAILs OF WINTER PROJECT

Students Name: Rohit Kumar Jha

Division 2 (SYMMS)

Roll No.-104

Project Name- Inventory Control.

Companys name:LECHLER INDIA PRIVATE LIMITED

Project Description

EXECUTIVE SUMMARY

Inventory is the most significant part of the company, which accounts for over 30-40% of the

companys expenditure. This project reflects the inventory management system of LECHLER

INDIA PRIVATE LIMITED. Inventory means all the materials, parts, supplies, expensive tools

and semi finished or finished products recorded on the book by an organization and kept in its

stocks, warehouse or plant for some period of time.

The area of focus of this project is to reduce the overall cost associated with inventory by the undertaking

activities:-

Obtaining the list of surplus stock and finding out reasons for growing surplus.

Attempt to reduce the existing surplus.

An attempt to prevent further accumulation of surplus

Making recommendations to the currently followed purchase procedure

Suggesting more effective method for the control of inventory.

Reduction of the accumulated/surplus stock period itself reduces unnecessary amount of money blocked

in the form of inventory and hence resulting in blocking the working capital of the company.

OBJECTIVES OF THE STUDY


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The primary objective of this project is to reduce overall expenditure or costing for the company by

lowering the cost associated with inventory.

Various other objectives pursued to fulfill the primary objective are as follows-

Reduction of existing surplus stock.

To avoid any further accumulation of surplus

To device an appropriate cost reduction technique of inventory control, which can be used along

with the existing technique to improve performance.

To ensure uninterrupted supply of materials.

DATA SOURCES

SECONDARY DATA-

As the project is based on Aligning the Inventory, hence data involved in the analysis is basically a

secondary data.

The facts and figures along with the records were taken from the executives of the company. Records

related to inventory were taken from purchase department and stores department.

METHOD OF DATA COLLECTION:

Since this scope & topic is based on theory it was imperative to use secondary data method for data

collection.

A real attempt was done to simplify the project research. The report is written in organized appearance.

Observations and recommendations are presented in this report in simple and systematic manner.

CONCEPTS OF INVENTORY

The literary meaning of the word inventory is stock of goods. To the finance manager, inventory

connotes the value of raw materials, consumables, spares, work-in-progress, finished goods and scrap in

which a companys funds have been invested. Good inventory management is good finance


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management. An efficient management of inventory should ultimately result in the maximization of the

owners wealth. Therefore inventory is considered as locked up capital. Inventories mean tangible

property held:

a. For sale in the ordinary course of business; or

b. In the process of production for such sale or

c. For consumption in the production of goods or services for sale, including maintenance

supplies and consumables other than machinery spares.

DEFINITION

Inventory management may be defined as the sum total of those activities which are necessary for the

acquisition, storage, sale and disposal or use of material. It is a subject which merits the attention of the

top level management and influences the decisions of the planning and executive personnel.

Decisions relating to inventories are taken primarily by executives in production, purchasing and

marketing departments. Usually, raw material policies are shaped by purchasing and production

executives, work-in-progress inventory is influenced by the decisions of production executives and

finished goods inventory policy is involved by production and marketing executives. The financial

manager has the responsibility to ensure that inventories are properly monitored and controlled. He has

to emphasize the financial point of view and initiate programs with the participation and involvement of

others for effective management of inventories.

ASPECTS OF INVENTORY MANAGEMENT

Inventories are quite crucial for any business firm. The raw materials inventory, if kept excess of the

requirement may lead to unnecessary blocking of the funds in such inventory, while if it is in shortage, it

will lead to disrupting the flow of production. Similar things can be said about the work in progress and

finished goods inventory. The option before the management is either to keep a very low level of

inventory which is also known as hand to mouth policy or to keep a large quantity of inventory ensuring

absolute safety.

As said, above, if inventory levels are kept very low. It will lead to frequent stoppages of production. If

finished goods inventories are kept very low it will result in distributing the delivery schedule to the


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customers. It may further lead to the cancellations of some of the orders. No firm can afford to take

such risks.

Alternatively, if inventory levels are kept on a very high level, carrying cost like storage, handling,

insurance, recording and inspection also increase in proportion to the inventory volumes. At the same

time, as large amount of funds are blocked in those inventories, the liquidity of the firm is severely

affected. The high levels of inventory may ensure safety but the cost of holding such a high level of

inventory may nullify their advantage.

It will also not be out of place to mention here that form holds inventories basically for three reasons:-

a) TRANSACTION MOTIVE:

This motive implies that inventories are maintained for the facilitation of smooth production

and sales.

b) PRECAUTIONARY MOTIVE:

It suggests that the inventories are maintained to take care against the risk of unforeseen

changes in demand and supply factors.

c) SPECULATIVE MOTIVE:

It says that the inventory maintenance (high or low) decision is affected by the motive to take

advantage of price fluctuations.

The aspects of inventory management can be described as follows:-

1. To ensure that a very high level of inventory is avoided.

2. At the same time to ensure that inventories are not so adequate that it will affect adversely the

smooth flow of production and sales.

3. Minimize the carrying cost and

4. Maintain an optimum level of inventories.


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OBJECTIVES OF INVENTORY MANAGEMENT

To have stocks available as when they are required. To minimize available storage space, but prevent stocks level from exceeding space availability. To meet a high percentage of demand without creating excess stock levels. In other words,

neither to over-stock nor to run out is the bet policy. To maintain adequate accountability of inventory assets. To keep all the expenditure within the budget authorization. To decide which items to stock and which items to procure on demand. To ensure adequate supply of materials, stores, spares, etc. minimize stock-outs and shortages

and avoid costly interruption in operations. To keep down investment in inventories, inventory carrying cost and obsolescence losses to

minimum. To permit a better utilization of visible stocks by facilitating inter-departmental transfers within

a company. To provide a check against losses of material through careless of pilferage To serve as a means for the location and disposition of inactive and obsolete items of stores. To provide a perpetual inventory value and a consistent and reliable basis for the preparation of

financial statements. To contribute to the nations economic well-being.

To contribute to profitability and

To bring down the inventory carrying cost inventory management is considerable.

TECHNIQUES OF INVENTORY MANAGAMENT

A. FIXATION OF THE LEVELS.

B. SELSCTIVE CONTROL OF INVENTORIES.

C. JIT

D. ANALYSIS OF INVESTMENT IN INVENTORY.

McDonaldss vs. Wendys: An Example

Its easy to see how higher inventory turn than competitors translates into superior business

performance. McDonalds is unquestionably the largest and most successful fast food restaurant in the

world. Lets compare it to one of its main competitors, Wendys.


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McDonaldss

2000 1999

Inventories $99,300,000 $82,700,000

Cost of revenue $8,750,100,000

Wendys

2000 1999

Inventories $40,086,000 $40,271,000

Cost of revenue $1,610,075,000

Use the inventory turn formula [cost of sales or cost of revenue divided by the average inventory values]

to come up with the number of inventory turns for each business. Between 1999 and 2000, McDonalds

had an inventory turn of rate of 96.1549[incredible for even a high-turn industry such as fast food]. This

means that every 3.79 days, McDonalds goes through its inventory. Wendys, on the other hand, has a

turn rate of 40.073 and clears its inventory every 9.10 days.

This inventory in efficiency can make a tremendous impact on the bottom line. By tying up as little

capital as possible in inventory, McDonalds can use the cash on hand to open more stores, increase its

advertising budget, or buy back shares. It eases the strain on cash flow considerably, allowing

management much more flexibility in planning for the long term.

PURCHASE PROCEDURE OF LECHLER INDIA PRIVATE LIMITED:

OBJECTIVE

To ensure that adequate technical & conventional data is provided to the vendors/sub-

contractor so as to enable them to supply product/material/service to the specified

requirements & on-time.


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SCOPE

This procedure covers direct materials, tools, consumables capital items which go into the

product, packaging materials & service sub-contractors.

Products & services which do not affect the finished product quality are extended.

PROCEDURE

1) PURCHASE INDENT ACCEPTANCE:

a.. Purchase action shall be taken on the basis of purchase indents received from the

concerned department or on the basis of reorder levels fixed for the stock items, as

received from PPC. Indents received from various departments are filed serially.

b. If the items are being procured for the first time, purchase department shall get the

approved drawing or the specification sheet of the items from the indentingdepartment.

2) PROCUREMENT ACTION:

a. Details of all purchase orders released by materials department shall be entered in the

purchase order register& the purchase order number as per the register serially. Control

shall be allotted to the purchase order released.

b. Imported Material: Purchase orders for imported material shall be placed on vendors

selected based on the recommendations of Lechler principals, or based on the pastreorder as recommended by engineering department

c. Indigenous raw material: For raw materials & bought out components procured

indigenously purchase order shall be placed on the vendor selected from the list of

approved vendors/sub- contractors. All the purchase order numbers are entered in the

purchase order register.

d. Capital items: Machine tools & other capital equipment having value more than 1 lakh

shall be procured against 'capital equipment indenting proposals' accompanied by

approved purchase indents. Machine tools & other capital equipments having value less

than 1 lakh shall be procured against approved purchase indent. The indents shall be duly

signed & approved by the Vice-President (Operations).

e. Whenever an order is placed on a new vendor/sub-contractor that is not yet approved, the

P.O shall be typed on trial purchase order.

f. The P.O shall include applicable items from the following:

i. The type, class, grade or other precise identification.


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ii.The title or other positive identification & applicable issues of specifications, drawings,

process requirements for approval or qualification of product procedures, process

equipment &personnel.

iii.The title number& issue of the quality system standard to be applied.

g. For regular procured items, an open purchase order shall be placed on the vendors.

Delivery schedule from time to time shall be sent to the vendors. If additional

quantity is required for some orders, amended schedule shall be sent.

h. For regular orders related to brackets & adaptors, the purchase order shall be released

once in a month.

i. Material movement slip shall be used whenever our material is sent outside for

machining/testing.

PURCHASE ORDER & AMENDMENT:

P.O's shall be raised on the vendor/subcontractor selected as above to

authorize the supply of direct material/items/services as per the terms of the

contract & delivery mentioned therein. Purchase orders shall be amended

whenever required & informed to vendor through P.O amendments.

REVIEW OF PURCHASE ORDER:

The P.O shall be reviewed for adequacy of the specified requirements priorto release. All the three copies of the purchase orders shall be approved of by

the appropriate authorities before release of the P.O to the vendors/sub

contractors to the concerned department in LECHLER INDIA PRIVATE

LIMITED. The authorize signatures are indicated.

VERIFICATION OF THE PURCHASED PRODUCT:Whenever specified in the contract, the customer or his representative shall be allowed for

the verification of the products either at LECHLER INDIA PRIVATE LIMITED works or at

vendor's place of work. The co-ordination for such verification activity shall be done by

marketing co-coordinator.

DISPOSAL OF NON-CONFORMING MATERIAL:

Non - conforming material shall be disposed off as per the procedure. Nonconformities

observed shall be reported in the non - conformity analysis register for initiating the

required corrective actions. Vendor/sub-contractor shall be intimated demanding corrective

action for repetitive non-conformities through supplier corrective action request.


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RESPONSIBILITY AND APPROVAL:

The authorities of the respective department shall be responsible for review,

implementation, control & verification of this procedure. He shall be responsible for

providing all means & facilities for smooth working of this procedure.

FORMATS OF PURCHASE

PURCHASE ORDER

Our Older No.

M/s..

Date

Your Ref. No.

Date

Please supply the under-mentioned goods to our works Subject to condition overleaf:

Sr. No. Description Quantity Per Rate Value

-

- --

Excise: MST/CST.

Octroi: Freight

Delivery:

Payment Terms:

Remarks


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PRUCHASE INDENT

Purchase Indent I~o,:

Date:

Please Purchase the following materials for

Sr. No.Description Code

Qty. Reqd. WhenR.eqd

Stock on Avg. Consu- Previous rate

hand mption .

-

Route

.

Inducted By Stores Purchase


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QUOTATION

BILL OF MATERIAL

Material Code No. A.B.C.& Co. Date

M/s.

- , -

,

Specimen of quotations File No.

Name of Minimum qty Rate per unit Time of delivery Terms of delivery Other terms

supplier offered

Desc.

El-O-Matic (India) Pvt. Ltd. Bill Of Material Main Assly.Pune No.

Sheet No.

Sr. Drawing Description Qty Set Source Material Reqd. Qty. Stock Stock

No No. Code For Regd. on Short-

* (Sets) * Hand * age *

ICHD.BY IDATE I APPR.BY I DATE


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STORES ORGANIZATION

Normally substantial amount of company's working capital is invested in stores. Due attention

should be given to stores routine. There should be system of proper accounting of materials and

supplies and it should be given same attention as is given to accounting for money. Raw

materials and supplies are equivalent of cash. They form an important part of manufacturing

and it is essential that they should be safeguarded and accounted for properly.

TYPES OF RAW MATERIAL

a. Raw Material Stores: -

It is the store where in incoming raw material, which directly contributes to the final

product, is received, stored and issued to the production department at various stages.

b. Engineering Stores:In this store, materials required of running of plant, which do not directly contribute as a part

of finished product, are stored. Machinery spares, consumables, stationery etc. are stored in

this and issued as per requisitions raised by various users.

c.Finished Goods Stores:It is the place where the finished products are stored after production and are ready to

dispatch to the respective locations or warehouses.


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FUNCIONS OF STORES DEPARTMENT

In the company, the duties or functions broadly cover three types - physical task of storing and

preserving material, technical job of providing storing facilities and administrative procedure for

documentation and accounting of material movements. Referring to a full - fledged storehouse

of LECHLER INDIA PRIVATE LIMITED the following duties and function can be enlisted.

1. Classification and codification of numerous materials by using suitable method of

codification is done in the stores. Then the manual of material - codes is circulated

among store staff and other concerned department managers.

2. The stores department takes physical charge of the material forwarded by goods receiving

and inspection section and places them in the respective bin.

3. The stores department provides necessary facilities for preserving the quality of materials

as long as they are in its custody.

4. It examines that issue procedure is properly followed by confirming the materials

supplied to production department only against written formal request/demand by

authorize through document material requisition note.

5. It keeps watch on actual stock level and compares the same with pre-set stock limits

(Maximum, Minimum, Reordering etc.) so that stock moves within limits.

6. Department prepares purchase requisition note for getting replenishment of stock when

actual quantity reaches reordering level.

7. The department carryout a regular review of stock for slow and fast moving materials,

damaged and substandard materials and reports such facts to top management.

8. It ensures that correct accounting entries are entered in stock register and records for each

transaction like receipt, issue, return to supplier return from shop floor.

9. It arranges for all type of information and data required by top management and other

concerned officers, specially keeping ready the details of stock position / balances.

10.The stores department undertakes physical verification (stock taking) for reconciling

actual balance with the book balance and identifying discrepancies, if any, with possible


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causes for the same.

STORES DOCUMENTS AND RECORDS

Importance of stores documents & records:-

The stores department is all the time expected to give latest information about stock balance,

movement of the materials, and condition of the material. Such reporting has to be based on

some authentic source and hence, the stores and other concerned departments - purchase,

production, costing have to record their instructions, actions, decisions by using well designed

documents and registers. The store keeper is primarily held answerable for each and every

internal movement of materials, particularly for the stock under his custody. Proper

safeguarding and identification of materials should be done by the storekeeper.

STORES ACCOUNTING RECORDS

There are two basic records of inventory control viz. Bin Cards maintained by store keeper and

store ledger accounts kept by costing department. It is the parallel accounting exercise based on

same facts, recording same transaction i.e. movements of materials. Simultaneously posting of

same entries in two independent sets of accounts offers facility of reconciliation, which in turn

acts as an effective tool of inventory control.

BIN CARDS:-A bin card is used by storekeeper to keep quantitative records for all the

items of materials and goods in his stores. This is a document maintained by store keeper

in his stores to assist him to control stock.

The format of the bin card is given below: A bin card is used for each material. Each receipt,

issue or return is recorded on the bin card in a chronological order and the latest balance isshown after each receipt and issue. Bin card is hung up in a convenient place outside the bin,

rack or shelf. Bin cards are hung near the bins, so that they are readily available for making

entries as and when the goods are placed into the bin or taken out. All bins racks or shelves,

etc. should be numbered consequently in order to indicate their location to the store keeper

and his assistance. This numbering also serves to connect the bin card with the bin, to which


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it belongs.

STORES LEDGER SYSTEM

It is kept in the costing department. The store ledger is generally maintained in the form of

loose leaf cards, because they can be removed and inserted easily. Each account in store ledger

represents an item of material. The format of store ledger is shown below: -

The store ledger provides a continuous record of material and stores, received, issued, returned

or transferred. It discloses the balance in hand both in quantity and value at any point of time.

It serves the management with the perpetual inventory record for necessary for decision

making. Material Receipt Report, Material Requisition, Material Return Note form the basis

for making entries in store ledger accounts. Entries made in the store ledger are identical tothose on bin cards except that money values are shown only in store ledger. It is very important

that store staff should have nothing to do with writing up of stores ledger account, which

should be written only by the staff of costing department.


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Since both bin card and store ledger account are written up from the same basic document,

the quantity balance are shown by these records should agree. The reasons for discrepancies

bin balances fewer than two sets are due to such reasons as:

a. Failure to post a particular transaction

b. Wrong posting in store ledger account

c.Wrong casting

d.Theft and

e. Items placed in wrong bin.

To avoid the problem of disagreement, the two sets should be reconciled either continuously

over a period. For automatic reconciliation, store department sends the original documents to the

revised balance of bin card after its inclusion. Costing department watch that the balance of bin

card intimated with the original document is correct.

FORMAT OF STORE LEDGER

Store Ledger Account X.Yz. & Co

Material Maximum Stock

Code No: Minimum Stock

Bin No: Re-older Level

Unit: Ordering Qty

Ordered Reserved Received

Date Ref. Qty. Date Ref. Qty. Date OR Note Qty. Rate Value


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Issued Stock Stock verified

Sr. No. Qty. Rate Value Qty. Rate Value Date Initials Remarks.


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DATA ANALYSIS

LIST OF PHYSICALLY CHECKED INVENTORY:

The lists of inventories in accordance with above mentioned categorization were procured from the

management information system/electronic data processing department. The format is shown as below:

REVIEW OF ALL THE ITEMS AT THE STORE:

REVIEW OF ALL THE ITEMS WITH ITS VALUE AND QUANTITY:

STOCK AS ON:-31.03.2010

SR. NO. MATERIAL DESCRIPTION STOCK RATE TOTAL

1. 1 CORE PVC CABLE 16 MM2 3 89.00 267.00

2. 1 CORE 1 MM2 BLACK 0 5.89 0.00

3. 1 CORE 1 MM2 BLUE 100 5.89 589.00

4. 1 CORE 1 MM2 GREEN 300 5.89 1767.00

5. 1 CORE 1 MM2 GREY 200 5.89 1178.00

6. 1 CORE 1 MM2 ORANGE 0 5.89 0.00

7. 1 CORE 1 MM2 RED 150 5.89 883.50

8. 1 CORE 1 MM2 WHITE 200 5.89 1178.00

9. 1 CORE 1 MM2 YELLOW 100 5.89 589.00

10. 10 PIN PLUG PRIYANTRONIX 2 303 606.00


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11. 10 PIN RECEPTACLE PRIYANTRONIX 3 293 879.00

12. 2 CORE PVC CABLE 1.5 MM2 5 24 120.00

13. 2 ROLL DRIVE WITH G BOX

( 250 RPM) 11 1850.00 20350.00


( IMPORTED) Geared roller 1 3100.00 3100.00


( IMPORTED) Plain roller 0 3100.00 0.00

16. 3 CORE PVC CABLE 1.5 MM2 25 31 775.00

17. 3 PIN PLUG & SOCKER MS TYPE 10 108 1080.00

18. 3 PIN PLUG PRIYANTRONIX

( TORCH) 6 59 354.00

19. 3 PIN RECEPTACLE PRIYANTRONIX (WF/PS) 6 55 330.00

20. 4 CORE PVC CABLE 1.5 MM2 116 41 4756.00

21. 4 CORE PVC CABLE 2.5 MM2 30 66 1980.00

22. 4 PIN PLUG PRIYANTRONIX 10 64 640.00

23. 4 PIN RECEPTACLE PRIYANTRONIX 8 58 464.00

24. 4 ROLL DRIVE UNIT WITH G BOX

( 145 RPM) 0 5900.00 0.00

25. 4 ROLL DRIVE UNIT WITH G BOX

( 66 RPM/37 RPM)With Motor 4 8150.00 32600.00

26. 4 ROLL DRIVE WITH G BOX (IMPORTED) 2 4500.00 9000.00

27. 6 PIN PLUG & SOCKET ( MS TYPE) 0

28. 92 TEETH 1 330.00 330.00

29. AFCO TAG ( SOLDERING TYPE) 800 0.10 80.00


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30. ALU PLATE ( CHOKE MTG) 75 10.00 750.00

31. AMEETER 0-1500 A 2 333 666.00

SR. NO. MATERIAL DESCRIPTION STOCK RATE TOTAL

32. AMMETER 0-1000 A 3 333 999.00

33. AMMETER 0-400 A 4 333 1332.00

34. AMMETER 0-600 A 0 333 0.00

35. ANTI SPATTER SPRAY 500 ML 0 68.00 0.00

36. ANTISPATTER GEL 300 GM 3 55.00 165.00

37. BAKELITE INS PLATE 1 55.00 55.00

38. BAKELITE STRIP ( INPUT CABLE) 2 10 20.00

39. BEARING 6004 4 125.00 500.00

40. BEARING 6006 5 185.00 925.00

41. BEARING 6007 5 225.00 1125.00

42. BEARING 6009 1 240.00 240.00

43. BEARING 6010 0 485.00 0.00

44. BEARING 6011 0 552.00 0.00

45. BEARING 6202 8 80.00 640.00

46. BEARING HOUSING (MS) 100*65 10 1840.00 18400.00

47. BEARING HOUSING (MS) 125*100 2+3 5 1840.00 9200.00

48. BEARING HOUSING 100MM DIA*125 MM

LONG 10 960.00 9600.00

49. BK WASHER AND BUSH

(FOR O/P TERMINAL) 0 13 0.00

50. BK WEDGES ( FOR CHOKE) 165 5.00 825.00

51. BOBBIN NO 13( 2 NOS/SET) 60 4.00 240.00


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52. BOBBIN NO 7 ( 12 NOS/SET) 100 7.00 700.00

53. BRASS NIPPLE ( GAS HOSE) 125 12.50 1562.5

54. BRASS NIPPLE 3/8" * 1/8" 29 20.00 580.00

55.

56.

57.

58.

FACTS OBSERVED DURING PHYSICAL VERIFICATION OF INVENTORY

The following points are also the points as to why the materials have become non moving and slow

moving at LECHLER INDIA PVT. LTD:-

MISPLACEMENT OF INVENTORY: Many of the items found to be misplaced. Either the material

was placed in appropriate bins &racks or the change of bin was not updated in the system.

RETURNED MATERIAL: the returned material from the shop floor is again mixed with the same

stock from which it is issued. No separate treatment is given to the returned material.

CRITICAL PURCHASE: Many high value non-stocking items were found in the stores, which were

yet not consumed.

OBSOLETE, SURPLUS 7 WASTE:

OBSOLETE: Those materials and equipment which are not damaged and which have

economic growth but which are no longer useful for company operation owing to many

reasons such as changes in production line, process, design changes etc.

SURPLUS: Those materials and equipment which have no immediate use, but have

accumulated due the faulty planning; purchasing and forecasting but they have usage

value in future.

SCRAP:Those materials like process wastage, such as training, boring, flashes they may

have end uses, and they have no market value.

THUS

OBSOLETE & SURPLUS= SLOW MOVING ITEMS (S) AND

SCRAP=NON MOVING ITEM


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FACTS OBSERVED DURING PHYSICAL VERIFICATION OF INVENTORY

The following points are also the points as to why the materials have become non moving and slow

moving at LECHLER INDIA PRIVATE LIMITED :-

MISPLACEMENT OF INVENTORY: Many of the items found to be misplaced. Either the material

was placed in appropriate bins &racks or the change of bin was not updated in the system.

RETURNED MATERIAL: the returned material from the shop floor is again mixed with the same

stock from which it is issued. No separate treatment is given to the returned material.

CRITICAL PURCHASE: Many high value non-stocking items were found in the stores, which were

yet not consumed.

OBSOLETE, SURPLUS 7 WASTE:

OBSOLETE: Those materials and equipment which are not damaged and which have

economic growth but which are no longer useful for company operation owing to many

reasons such as changes in production line, process, design changes etc.

SURPLUS: Those materials and equipment which have no immediate use, but have

accumulated due the faulty planning; purchasing and forecasting but they have usage

value in future.

SCRAP:Those materials like process wastage, such as training, boring, flashes they mayhave end uses, and they have no market value.

THUS

OBSOLETE & SURPLUS= SLOW MOVING ITEMS (S) AND

SCRAP=NON MOVING ITEM


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RECOMMENDATION AND SUGGESTION

The company was recommended to adopt a locking system which is as follows:-

Security for inventory is a must for every received material.

Security for GRR(Goods receipt report) is a must

For any transaction valid and released Purchase Order is required.

For any excess received material more than Purchase order receipt requires the approval of the

Vice President - Operations for acceptance.

The GRR details are to be updated within 5 days in the system or the information is blocked and

manually updated in the stores.

Suppose stock is under safety level, the required quantity is to be ordered after the approval

from the Vice President - Operations of the company.

For critical items emergency stock is maintained in stores and recommended in the system and

used with the approval of the Director-Operations of the company.

Due to business constraint the item-springs is stored in the stores department for 2 months.

Documents

Winter Report (1)