FINANCIAL CONTROL OVER STORES EXPENDITURE

FINANCIAL CONTROL OVER STORES FINANCES

ORGANIZATION OF STORES BRANCH

COS

CMM

DY CMM/ Sr DMM

SMM/DMM

AMM

Ch OS                                   DMS/DSK

OSI/ OSII                               WARD KEEPER

    HC                                          STORE KHALASI

                                             SC/CL

 Stores Depots:

In Southern Railways , there are 5 Divisional stores set-ups and 23 stores depots (including 3 divisional stores depots) spread all over the states of Tamil Nadu and Kerala. The stores depots have been listed below with the place code and its location……

The stores department of Southern Railway supplies nearly 14000 items of raw materials, spare parts and consumables required for the maintenance of Railway assets and operation of services through its 23 stores depots located at various locations in Southern Railway. For enabling systematic management of the purchase and warehousing functions all these items are categorized into 79 major groups with each item being given a unified 8 digit price ledger number, all over the Indian Railways.

Characters of 8 digits:

1, 2 digits Major groups; 3, 4 digits Sub groups; 6, 7 digits Serial No

8 digits Check digit

DETAILS OF STORES DEPOTS ON SOUTHERN RAILWAY

S.No	Place code	Office Name	Place/Station
1	00	General Stores Depot	Perambur
2	01	Loco Stores Depot	Perambur
3	02	Mechanical Stores Depot	Golden Rock,Trichy
4	07	General Stores Depot	Palghat
5	08	Diesel Stores Depot	Erode
6	09	Branch Stores Depot(Eng)	Arakkonam
7	10	Traction Stores Depot	Tambaram
8	11	Signal Stores Depot	Podanur
9	12	Press Stores Depot(Rly printing press)	Royapuram/Chennai
10	13	General Stores Depot	Erode
11	14	Divisional Stores Depot	Madurai
12	17	Wagon Production	Golden Rock,Trichy
13	18	Diesel Stores Depot(Diesel work shop)	Golden Rock,Trichy
14	19	Diesel Stores Depot(Diesel shed)	Golden Rock,Trichy
15	20	General Stores Depot	Quilon
16	21	Electric Loco Stores Depot	Arakkonam
17	22	Electric Loco Stores Depot	Erode
18	23	Diesel Stores Depot	Ernakulam
19	24	General Stores Depot	Golden Rock,Trichy
20	25	Coach Maintenance Stores Depot	Basin Bridge/Chennai
21	26	Diesel Stores Depot	Tondiarpet/Chennai
22	27	Traction Stores Depot	Avadi
23	28	Carriage Stores Depot	Perambur

Purchase Section	Group Of Stores	Description Of Stores
04	30,32,33,34,36	Carriage and wagon spares
44	37,38,39	Carriage and wagon spares
WP	37,38,71,73	Wagon production
21	00 to 09	Steam loco spares
	31,35	E.M.U. coaches, B.G and M.G. spares
13	10,15	Diesel loco spares
28	12	Diesel loco spares
43	11	Diesel loco spares
29	13,14	Diesel loco spares
01	74,84	Wire ropes, chains, oil lamps, buckets, refractory, asbestos and class sheets
	60,85	Track maintenance tools, ball and roller bearings
06	82,83	Hospital equipments and stationary
09	75,91	Rubber, plastic, canvas and leather goods non-ferrous metals
27	79	Cloth, personal equipments, cotton and woolen products
40	77,81	Paints, enamels acids, chemicals
10	80,86,92	Petroleum products, fire fighting equipments, coal, coke fuel oil
	93	Timber
11	42	General electrical fittings
	45	Train lighting cells, train lighting items
12	40	Cables, conductors and wires
	41,43	Insulators and insulating materials, electrical measuring instruments
	46,47	Electrical sub-station transmission and distribution equipments, electrical machinery and parts
26	25,28	A.C.loco spares
05	50	Telegraph and telephone equipments and spares
	52,54,55	Wireless and electronic equipments, mechanical signal and inter-locking equipment, single and double wire
07	70,78	Abrasives, furniture, kitchenware
	71,72	Brushes, bamboo products, small tools
	73	Hardware fasteners, rivets, bolts
14	90	Metals, ferrous and Ferro alloys including wires
16	65	Plants and machinery including cranes
	66,76	Spares for plant and machinery, electrodes, cutting and welding accessories
	67	Road motors, auto-trucks, material handling equipments and spares
35	56,61,62	Electrical signal equipments, building material pipes and pipe fittings

STORES ACCOUNTS

DY FA&CAO/Stores

Sr AFA/Sales, Sr AFA/GSD, Sr AFA/IC

FINANCIAL CONTROL OVER STORES EXPENDITURE – STORES FINANCE SECTION

I.                    TENDER OPENING

Representatives from Stores Finance – generally Section Officers are to witness the opening of bulletin tenders daily. Besides witnessing the opening of the tender boxes by the staff of stores branch, they must certify the offers group wise by rounding of the commercial terms like rate in figures and words, freight, FOR/FOB, payment clauses, any correction/overwriting/modification is duly authenticated by certified signatory.  

II.                  QUANTITY VETTING

Vetting of Indents/ANEs: 

Stock Item:

1.       A-Category: vetted by Associate finance.  Quantity tendered to be verified with respect to expected annual consumption (EAC) approved by COS/CMM.  Buffer is taken for 1 month and for Safety/Vital items it is 2 months.  If EAC being adopted is more than 10% of the last three year’s annual consumption, then it is to be indicated in the observation while verifying the tabulation statement.

2.       B-Category:  Vetting not required.  Buffer is taken for 2 months and for Safety item it is 3 months.

3.       C-Category:  Quantity tendered to be verified with respect to EAC approved by competent authority.

Vetting of Non-Stock Items Indents

1.       In terms of Railway Board Lr No 2007/RS(G)/779/1 dt 16-10-08, vetting of NS demand requisition is required only for Safety items above  2 lakhs and  1 lakh for other than Safety item.

2.       Essentiality certificate for requisition of Safety item valuing upto  2 lakhs by Field officer at JAG level and above  2 lakhs for SAG level i.e. CWM/ADRM/DRM is needed.

3.       Similarly, essentiality certificate for requisition of items other than Safety items valuing upto 1 lakhs by Field officer at JAG level and above 1 lakhs for SAG level i.e. CWM/ADRM/DRM is needed.

4.       Signing of PAC: Indenting Officer – upto  25,000

                                                   i.      JAG/SG officer –  75,000

                                                 ii.      SAG officer – upto  3 lakhs

                         iii.  PHOD/CHOD – above  3 lakhs

5.       In case of items required for RSP, NS Indent has to be prepared invariably even if it is a stock item.

III.                TABULATION OF TENDER

As per the MMIS (material management information system) programme, the vetting of Tabulation Statement will be as under

•         If there are no special conditions/PVC(price variation clause)  etc., given by any tenderers on commercial rate page, the IREPS (Indian Railway Electronic Procurement System) generated tabulation statement duly signed by the tender opening official from Stores and Stores Accounts shall be deemed as vetted tabulation statement and no further vetting by Stores Finance is required.

•         However, any Brief Note containing details of last purchase rate - LPR, availability of Option clause, demand reference etc. should be got vetted from Finance before opening of tenderers.

•         In case any updated manual tabulation statement is required to be prepared for taking PVC/conditional offer rate by tenderers with Account, such manual tabulation statement shall be vetted by Accounts as per existing procedure.

Check Points for verification of Brief Note:

•         Approval of competent authority has been taken for floating a tender.  This should be verified with respect to SOP.

•         Description, drawing No., specification No. indicated in the demand to be verified with that tendered

•         Vetted original Indent is placed on file and funds duly certified (more than 1 lakh).

•         Original Indent is placed on file and with funds duly certified (less than 1 lakh).

•         Newspaper clipping is available of file.  The description of the item therein should match with that tendered/indented.

•         In case of amendment to the tender, copy of Corrigendum is available on file.

•         In case of Limited/Special Limited tender attention of all approved sources has been drawn.

•         Special conditions enclosed to the AT form to be highlighted while verifying the tabulation statement.

•         Tender documents not signed by the tenderers and teem with financial implications not rounded off by the tender opening officials should be brought out in the observations while verifying the tabulation statement.

•         Counter offer with regard to the tendered description quoted by tenderers, if any, should be specified.

•         Details of LPR/rate from neighboring Railways have been incorporated in the tabulation statement duly placing copies of the same in the case file.

•         Tenderers who quote FOR/Destination to be highlighted while verifying the tabulation statement.  Split up of costs to be called for purposes of bill passing.

•         Special conditions such as SVC/PVC/FM/LD/ MODVAT/Discount clause have been highlighted.

•         Level of TC to be indicated as per SOP.

•         Briefing Note to accompany Tabulation Statement for Sr.Scale TCs onwards.  COS office Lr.No.S.232.P.2G &P dt.20-06-06 to be followed.

•         All sheets of the Tabulations Statement have to be signed after verification.

IV.                VETTING OF DRAFT PURCHASE ORDERS

Two types of POs are vetted by Stores Finance.

1. More than 10 lakhs:  Purchase involving more than 10 lakhs are finalized through a constitution of Tender Committee.

        POs are made out with reference to TC recommendations and acceptance.

2. Less than 10 lakhs:  Purchase involving less than 10 lakhs are directly finalized without going through the procedure of Tender Committee. 
3. The above powers are applicable only for Stores Branch and Stores Items of Civil Engineering Branch.
4. Medical Branch has separate powers of delegation.

The following points are to be scrutinized while vetting a PO.

•         PO has been prepared as per TC recommendations and as per the orders of the accepting authority.

•         It should be ensured that there are no contradictions between the PO and the Company ’s offer and subsequent letters withdrawing/modifying certain clauses/conditions based on the Railway’s request.

•         PO terms and conditions viz., destination i.e. FOB, FOR destination etc., inspection agency i.e. RDSO, RITES/Consignee, period of delivery, IRS conditions of contract, price, PVC formula should be specified, applicable rate of ED and CST, freight cost, SVC, MODVAT, payment terms, mode of despatch, EMD/SD, Guarantee terms, validity of offer etc.

•         Counter offer acceptance has been received from the Company s.  POs should not be placed unless the counter offer has been accepted by the Company  unconditionally.

•         As per the Indian Contract Act, an offer when accepted becomes a promise/contract.  Therefore, in order to convert a proposal into a contract, the acceptance should be absolute and unqualified.

•         An acceptance introducing new terms or conditions varying from that of a proposal amounts to a counter proposal and rejection of the original offer unless the party making the proposal renews it or agrees to suggested modification.

•         In case of Stock items, availability of funds is to be ensured.

•         If the value of the Non-stock PO is more than that of the Indent on account of rate, revetting of Indent is not required only additional funds have to be certified by the consignee.  However, if the increase is on account of quantity, then, revetting is required.

•         Developmental/Trial order should be boldly indicated on the PO.

•         If Option clause is available or not should also be indicated.

•         Risk purchase and details of original POs should be clearly mentioned in the Risk purchase tender POs.

•         In case a Company  does not accept certain conditions of advance acceptance letter, POs should not be vetted and referred back to the TC.

Vetting of POs valuing less than Rs.10 lakhs

These comprise of POs where there are no TC for these cases and are prepared with reference to the Company ’s offer.

•         The role of Accounts officer in vetting in such POs acquires greater significance because these are the cases which are accepted directly by the Purchase officer and they have not been deliberated upon by a TC.

•         The following points are to be scrutinized.

•         Description/specification furnished are complete

•         Corrections made in the demand have been attested

•         Demand is vetted if the value exceeds Rs.2 lakhs in case of Safety item and Rs.1 lakh in case of other than Safety items.

•         Quantity has been reviewed

•         Acknowledgements for limited Tender/Bulletin Tender have been placed on the file

•         List of quality spares/RDSO sources/ICF sources have been placed on the file

•         Status of offer (solicited/unsolicited) with respect  to registration for the subject rate growth.

•         Rate reasonableness

•         Reasons for passing over and acceptance of offers have been recorded on each offer as well on noting side

•         Samples have been submitted if required

•         Technical suitability has been obtained

•         PVC has been updated

•         Funds certification incase of Non-stock item has to be certified by the consignee.

•         In case of Single offer for a Limited/Bulletin tender, Urgency certificate has to be given by a officer not less than the grade of SAG for above Rs.50,000 and by JAG for below Rs.50,000.

•         Apart from the above, rate reasonableness should be certified and the enquiries should have been sent to all the earlier suppliers and acknowledgements to be placed on the file.

•         If the value of Non-stock PO is more than that of the Indent on account of rate, additional funds have to be certified.  However, if the increase is on account of quantity the Indent has to be revetted by Associate finance.

•         NS requisition is to be countersigned by competent authority.

•         Freight breakup given in case of FOR destination, inspecting agency indicated, payment terms, price preference/time preference, Standard Variation  clause, SD, EMD, collection/waiver etc.

V.                  FINANCE CONCURRENCE OF MISC PROPOSALS

    Stores Finance section vets modifications to purchase orders MPOs in all cases where financial implications are involved.  The following situation could arise during the currency of contract and which will lead to modification of POs.

•         Extension of delivery period and the funds have to be booked to a different financial year as compared to the original booking.

Check points in the MPO while exercising 30% Option clause:

•         Contract is live i.e. delivery exists or supply are yet to be completed.

•         30% Option clause is available on the original PO

•         Demand is available and is placed on the fie.

•         Approval of competent authority has been obtained for exercising the Option clause.

•         Whether any tender for similar item has been finalized subsequently at a lower rate