Purchase Procurement

And
Stores

Janatha Group
Standard Operating Procedure
 Repair and Maintenance:
1. IT Work:
Person Accountable: Mr Prakash
Job roles to be performed:
 Follow-up with the vendors.
 Price negotiation
 Raising work requisition
 Estimation
 Work completion
 Quality assurance
 PO follow-up

2. Electrical Work:
Person Accountable: Mr Sujith
Job roles to be performed:
 Follow-up with the vendors.
 Price negotiation
 Raising work requisition
 Estimation
 Work completion
 Quality assurance
 PO follow-up

3. Plant Work:
Person Accountable: Particular department heads
Job roles to be performed:
 Follow-up with the vendors.
 Price negotiation
 Raising work requisition
 Estimation
 Work completion
 Quality assurance
 PO follow-up
 4. Civil Work:
Person Accountable: Mr Srinivasa (Factory Manager)
Job roles to be performed:
 Follow-up with the vendors.
 Price negotiation
 Raising work requisition
 Estimation
 Work completion
 Quality assurance
 PO follow-up
(These above further work is done by the centralized Purchase Department)
Centralized Purchase Department:
Person Accountable: Mr Santhosh
Job roles to be performed:
 Check
 Analyse, clarify and suggest
 Issue PO
 Verify and Validate
 Bill Acceptance
 Payment request to accounts

Note:

Single authorized manufacturing vendors Quotation is estimation

Work order PO is done over completion
but, this can’t

exceed the quotation value, it can be further negotiated by the purchase

head or MD
Single authorized manufacturing vendors Quotation is considered as
estimation
Outside work except section related requisition needs to be sent for Santhosh
because work order needs to be raised and remaining placed at stores, and
sent to Santhosh with bill and GRN
Work order Maintenance and completion:
These documents are issued by the purchase/ stores department for the repair and
maintenance of materials in the organisation, it consists the requisition number, the
department, type of work, its estimation and sometimes the warranty of the
particular information.

1. PURCHASE - APPROVAL FOR RAW MATERIAL SUPPLIERS

 

Purpose: To ensure product safety, legality, and quality of the product

Scope: Applicable to the Quality Assurance department.
Responsibility: QA In-charge & Purchase In-charge
Procedure:

 Raw material is inspected vehicle (or) lot wise by the supervisor.

 The raw materials are inspected for the following parameters like
temperature and organoleptic parameters.
 The Raw material required for processing is purchased from the suppliers of
the local purse seiners/boats/trawlers and is transported to the factory in
covered trucks.
 Upon arrival allotted the date, purchase center, and arrival number, etc.
 The raw material shall be accepted or rejected after evaluation by QA staff.
 For every vehicle or 10000 kg of raw material 10 kg sample is checked for
quality parameters like spoilage, size, etc and temperature is checked
randomly at different locations at vehicle top, bottom, side, corner, etc,
 The raw material evaluation was randomly cross-checked by in charge of
Quality Assurance & Production In charge. The raw material found any
deviation and not fit for production, the technologist informed QA In-charge
and the Q. An In charge rejects the material.
 
 Records:
1.            Supplier Guarantee
2.            Raw Material Receiving and Evaluation
 2. PURCHASE/APPROVAL OF PACKING MATERIAL, INGREDIENTS &
SANITIZERS    
Purpose: To ensure product safety, legality, and quality of the product
Scope: Applicable to the Quality Assurance department.
Responsibility: QA In-charge & Store In-charge
Procedure:
 The extent of control of the supplier is based on the critical of
chemical/packing materials / Engineering Material.
 The results of suppliers’ performance in terms of adherence to quality and
delivery requirements are monitored. This data s reviewed by the Store
head.
 A material safety data sheet shall be collected for each preservative and
sanitizer.
 Performance monitoring is done once every three months for packing
material and ingredients.
 Based on the purchase order, the packing material shall be supplied by the
supplier.
 Based on the demand of the material is placed by the purchase executive
general stores departments in a purchase order. This has been verified and
a purchase order is issued on suppliers listed in the selected list of
suppliers.
 This data is prepared with the name and description of the material,
Quantity
 Issue of Stores: Various departments require material requests for stores in
the request form for stores. The store supervisor checks the details and
enters the same in the stock.
 The chemicals are all stored at normal room temperature and the company
shall use the material within the recommended self-life for the
manufacturing process.
 The arrival of material, if the packing material/preservatives/cleaning
chemicals, shall fail to the company’s specifications. The material shall be
rejected and the consequence sub-standard supply shall lead to the
delisting of its name from the approved supplier's list.
 * Handling of exceptions- There may be times when an emergency
purchase needs to be made or existing suppliers of certain materials are
down. On arrival of the material shall be checked by the technologist. If it
fails to meet our company purchase specifications, it will be rejected.  
 
Records:
1.            MSDS of Preservatives and Sanitizers
2.            Supplier Approval for Packing, Preservatives, and Sanitizer
3.            Records of evaluation and re-evaluation are maintained by the Store head.
 3. AMC - Annual Maintenance Contract

AMC is itself a bond between the service provider and the beneficiary (Janatha)
for the repair and maintenance of the machinery, replacement of the parts, and
providing timely service for a specific period mentioned in a contract.

It's a bond for the specific amount where the service provider is liable to meet the
timely requirements of the client (Janatha).

All the clauses in the contract should be mutually agreed upon and signed, and the
payment is released by the client.

However, to renew the contract, a review of service and the quality of the

maintenance work on time by the service provider is must (i.e., Service provider
analysis is a must).

To suffice this requirement, work requisitions, work completion, and the

grievance report are to be documented.
Various SOP formats for the purpose of documentation:
 Purchase Procurement

General Purchase Raw Material (Fish)

(IT, Repair & Maintenance, Production materials, Consumables)

Procurement:
 Ensure that the purchase requisition comes from the concerned
Department.
 Purchase order is raised to the respective vendor from the approved
vendors list.
 Take management approvals on current list of vendors.
 Quotations at least 3 or 4 are mandatory.
 Purchase requisition must have all the supporting documents i.e. Product
movement, consumption report, forecast report, last purchase price and
cost analysis report.
 Requisition must be signed by the inventory control team.
 Month end total purchase should be in the records, filed with a copy of the
purchase order invoice and delivery proof.
 Payment advice.
 For overseas requirements also please adhere to the above-mentioned
points.

Administration: (fixed asset management)

Vehicles:
·        All vehicles with their respective registration numbers must have each
file.
·        Vehicle log sheet is to be maintained.
·        Vehicle fuel consumption report to be prepared monthly.
·        Vehicle insurance, periodical maintenance reports, yearly passing or any
others, should be followed.
·        Purchase order to be raised for all expenses.
·        New vehicle purchase, rent a car, hire a vehicle on lease, passenger
service for pickup and drop.
·        Entertaining guests on a visit.
IT cell: (fixed asset management)
 Organizational ERP and maintenance of hardware/ IT admin – LAN,
Internet maintenance.
 IT accessories and equipment (Laptops/PC), proper records and also
records of old & obsolete stock beyond economical repair (To write off
yearly informing finance).
 Purchase requisition with justification.
 Periodical maintenance (File the records)- CC camera.
 Asset Management:
 Companies fixed assets, land and buildings, furniture & Fixtures, Air
conditioners/Others, Valuation, Deprecation, Maintenance, Contracts (rent,
legal or any other contracts).
 Insurance comprehensive for Plant & Machinery, Stores, Goods, Office and
equipment.
 Goods in transit insurance.
 Housekeeping and others
 Safety measures implementation on the premises.

Procurement Checklist for Internal Audit

 Check whether company have dedicated process (SOP) for procurement.
 Check whether there is Delegation of authority matrix.
 Check roles and responsibilities are as per the matrix and process.
 Check whether department have training manual to help users in
creating purchase request and purchase orders
 Check whether all the activities are done as per the process
 Check logical access rights to respective users of procurement software
(If any used)
 Check SOD rules built in the software
 Check PO dump (If available) and pick samples to check each one in
detail
 Check whether each purchase is supported by quotations from at least 3
vendors
Documents for stores:

 Goods receipt note:

Goods Received Note (GRN) is a record of goods received from suppliers,
and the record is shown as a proof that ordered products had been received. The
record is used by the Stores for comparing the number of goods ordered to the
ones delivered. It is used for stock updates and the payment of goods obtained. It
is an internal document produced after inspecting delivery for proof of order
receipt. Generally produced by the stores team.

 Material issue note:

It is the most important document of an authority to the storekeeper to issue the
Chemicals. It is a normal request written in a paper from production department
to store department.

 Material Return Note:

Sometimes the production department may have materials left over either due to
wrong estimation of requirement for a job or material defect. This excess material
should be returned to stores without delay. Department returning the materials
prepares a material return note in duplicate. One copy, duly signed, is returned
by the store keeper to the returning department, and the other copy is retained by
the store keeper for completing his own records. Material returned note contains
particulars similar to a material issue note. It is generally used for the chemicals.

 Stores requisition:
It is the most important document of an authority to the storekeeper to issue the
materials inside the stores except chemicals. These materials include hardware
and tools, structural and the civil items, electrical, plumbing and more. It is a
normal request written in a paper from production department to store
department.