Review of Stock Verification Cell functioning under WAAO/BSL

Stock Verification of BSL Division is under the Administrative control of 3 Officers i.e. WAAO/BSL, WAAO/MMR and WAAO/NKRD. The distribution between these units is done based on Track Kms. A test check has been carried out in this report for the portion pertaining to WAAO/BSL.

The main objectives of this cell are verification of capital, revenue and dead stock stores, qualitative analysis for inventory management, conducting special and surprise checks, lot inspection of scrap stores, witnessing of Auction sale, deliveries of stores and any other duties assigned to them by stores accounts branch and Divisional Accounts office. ISAs and ASVs have different sets of duties and functions to achieve these objectives. In this Test Check the Duties to be performed by ISAs and ASVs have been reviewed vis-à-vis to actual performance of this cell pertaining to the period from April to Oct’02 .

Performance of ASVs:

Number of units for which stock verification programme is to be completed in the year 2002-03 = 144

Man-days demanded for the year 2002-03 = 2556

Man-days allotted by HQ for the year 2002-03 =1889

Arrears of last financial year completed during this year:

(a) No. Of Man-days = 215

(b) No. Of Units = 28

Stock verification programs for year 2002-03 completed till Oct.’02 end = 79 out of 84 proportionate programmes.

No. Of Man-days booked till Oct..’02 end = 887 out of the proportionate booking of 1102 .

SV Sheets generated by the end of Oct’02 = 36

Narrative reports generated by the end of Oct.’02 = 02

Man-days arrears by the end of Oct.’02 = 215

It can be seen from the above data that an arrear of 215 man-days has since accumulated to end of Oct.’02. In addition to the vacancies of ASVs there are many other reasons contributing towards these arrears. During this year an arrear of 215 man-days from the previous year was also completed . It was found that approx 70% of man-days of ASVs were utilized for verification work. It was also observed that man-day booking was less because ASVs were not utilized efficiently. Some of them have availed holidays to the extent of 30-40% of total working days

Approx. 28% of man-days were booked for auction sale witnessing. It is to be noted that the number of Man-days on this activity depend upon the sold scrap material in the year, which is unforeseen. The stock verifier is also supposed to conduct surprise checks on stockholder, however, it was found that no such checks were conducted to end Oct.-02.

The qualitative analysis shows that only two Narrative Reports were issued upto Oct’02 which is very small number. It was further found that the Narrative Reports issued in the recent past have failed to cover the area of Inventory Management . The areas like stocking of each item vis-à-vis maxima and minima for the item, history of overstocks, assets lying idle, utilization of local purchase and non-moving and surplus stores have not found due attention .

Performance of ISAs:

It was a revelation that 31% of time utilized by ISAs was devoted to chasing of SV sheets and NRs. However, appreciable work has been done on this front. To end of Nov.’02, 52 SV sheets are cleared out of 110 SV sheets on this unit, which is all time high. This was obviously as a result of personal attention paid by FA & CAO and GM. At the same time it is seen that only 3 out of 17 Narrative Report were closed during the period. Thus due attention has not been paid to closure of NRs.

A total of almost 21% of man –days were booked on inspection of lots of scrap material,

which is justifiable keeping in mind the earning targets for scrap sale as set by HQ. There were no arrears in the lot inspection programme as circulated by DCOS/MD. A total of 4% of man-days were booked on witnessing auction sale. It was also seen that ISAs spent more than 5 days in office work on an average per month.

The ISAs are also supposed to conduct test checks of ASVs. As per SV manual an ISA should carry out test checks of each ASV under his control at least once in two months. In regard to physical verification, at least 10 items should be verified by ISA. As per this provision 32 number of test checks were to be carried out. However, only two test checks were actually conducted by ISAs. Test check as an effective instrument of checking the working of staff down below has not been paid due attention.

It is also seen that a foot-to-foot survey of P.way material

and inspection of shop floor inventory was also conducted as instructed by HQ and reports were issued. ISAs are also supposed to carry out surprise checks of depots. The element of surprise has not been observed in their checks.

Sale suspense shows that a huge amount of Rs 1.71 crore is lying against Bhusawal division to end of Sept’02 pertaining to P.way and Non-P way material having total 25 cases. It may be due to delayed processing of sale issue note as well as material sold in Auction sale but not lifted by the purchaser. The oldest case is of 1990.

Suggestions:

In view of recent instruction of F.C regarding amortization of capital-at-charge, redundant assets are required to be debited from capital at charge. A specific duty of identifying such assets should be added to the duty list of ISA. In addition to above a system may be developed wherein unaccounted material lying anywhere in the division is promptly reported by ISAs to concerned executive and the database of the same is maintained.

It is also seen that the ASV manual is as old as 20 years. It requires to be updated and sufficient reprints made available.

Implementation of MMIS in engineering deptt. is on progress. ISAs should be given computer training as a part of skill up-gradation and a computer to S.V. Cell may be provided to all the divisions.

For better arrangement of stock verification cell a post of coordinating ISA may be created out of the senior most ISA.

There are SV sheets which have been pending since last twenty years or so where even the initial replies have not been made by the executives. In the existing system, clearance of the SV sheets is also the duty of person issuing it. Large number of frauds pointed by ISAs get filed up and remain pending till the defaulter retires. It is seen that there is hardly any recovery effected even in very obvious cases.

The total recovery made due to closure of 52 SV sheets was Rs.6392/- only, which is negligible looking into the amount of irregularity initially pointed out in these SV sheets. Therefore, this may be considered whether the system of admitted and non-admitted debit as applicable in case of Commercial Department and the role of TIAs can be introduced in the working of ISAs. The closure of SV sheets should be the responsibility of Executive and not ISAs. In the working of TIAs the system takes care of debits raised and the recoveries affected are quite high.

There is no system of in house training of Stock Verifiers and ISA’s and the level of motivation is very low.

_ Hira Ballabh, IRAS(1992) – SrDAO/BSL/CR.

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