Storage Procedures

May 2005

Logistic Department Action contre la Faim

Document revision history:

Revision date 25/15/2004 01/05/2005 Author Logistic Department Logistic Department Summary of changes Initial release Correction various mistakes

Notes:

Table of contents:
1 - Introduction.............................................................................................5 2 - Product codifications...............................................................................5 2.1 The financial code...............................................................................5 2.2 The project code.................................................................................6 2.3 Item code ACF.....................................................................................6 2.4 UN reference.......................................................................................7 3 - In and out procedures.............................................................................8 3.1 Deliveries IN........................................................................................8 3.2 Deliveries OUT....................................................................................9 4 - Respect of the financial allocation of products.....................................10 5 - Inventory counting and administrative stock audit...............................12 6 - OD and stock management..................................................................12 7 - Essential documents for stock management........................................13 7.1 Stock card.........................................................................................13 7.2 Release Order (RO)...........................................................................14 7.3 Delivery Note (DN)............................................................................14 7.4 Stock report......................................................................................15 7.5 The inspection form .........................................................................16 8 - Additional documents for stock management......................................16 8.1 Distribution forms.............................................................................16 8.2 The Loss Report ...............................................................................17 8.3 Detail of deliveries............................................................................17 9 - Archiving of stock documents...............................................................18 9.1 Filing at the warehouse.....................................................................18 9.2 Filing at the logistic department ......................................................19
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10 - Standard forms within the Kit Log V 2.0.............................................19

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1 - Introduction
Action contre la Faim has a supply chain based on stock: most of the supplies for the programmes transit through a warehouse. To deliver an item from a stock is the quickest answer to a need. The items in stock have several financial origins: - Purchase on a donors grant (budget) for a specific program - Gift from an IO/NGO, usually earmarked - Purchase on ACF funds - Left over from previous activities, thus items purchased on previous budgets Definition: A product is a same article (same trademark, same packaging, same expiry date) purchased on a unique budget line. Each product in stock has a funding and a predefined assignment. Action contre la Faim must respect and be able to justify the utilisation of these products. Therefore an efficient recording system of all stock movements is needed: - For IN movements, the records shall allow to identify the origin of the products - For OUT movements, the records shall allow to trace the destination and use of the products

2 - Product codifications
2.1 The financial code
The purpose of the financial code is to identify the funding origin of a product. The format for financial code is: CC / CC DD B LLLL DD / B / LLLL 2 letters for the country code 2 letters for the code of the donor 1 letter for the budget 4 characters for the line
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Example: The North-Caucasus mission (country code CS) purchases porridge on ECHO budget M, line AA 10. The financial code will be: CS / A1 / M / AA10 The financial code should be mentioned on the purchasing documents (Purchase Order, External Order Form or contract) or on the Delivery Note.

2.2 The project code

The project code identifies what should be the project of destination of the products. The project code can be useful for stock management when a budget line is funding two or more different project. By using the project code the logistician can pre allocate and follow the quantity left in stock for each project. The project codes are defined by the Administrator, the format is: BB P NN BB 2 letters for the base P 1 letter for the programme N: Nutrition, H: Hydro (Watsan) F: Food security, M: medical, C: Coordination NN 2 figures to the project

2.3 Item code ACF

When the stock activity is important, with numerous movements and various products an item codification for key items is advantageous. Experience shows that data entry mistakes are common on the designation of products. In addition, by sorting a Stock report by item code, the Logistics Coordinator knows the quantity of one item in stock regardless the donor, the project and the expiry date. The item is classified regarding its nature and not regarding its destination. Example: Cement will always have the same item code, even if bought for rehabilitation, Watsan or a food security project.

The format for item code is: CCC / NNN CCC Category NNN Reference inside a category
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CATEGORIES Code Designation Example AGR AGRICULTURE Hoes, seeds, fertilizers BUI BUILDING Cement, bricks, tools COO COOKING Plates, cups EDU EDUCATION Flip chart, board FOO FOOD All food items FUE FUEL Diesel, petrol, kerosene FUR FURNITURES Tables, chairs, desks HYG HYGIEN Towels, soap, brush, HTH Equipments and blankets, LOG LOGISTICS sheeting NUT NUTRITION F100, F75, Resomal OFF OFFICE Lamp, fans, calculators STA STATIONERY Pen, paper A4, cartridges VEH VEHICLE All spare parts, tools VIS VISIBILITY Stickers, tee shirts WAT WATSAN Pipes, taps, drilling bits If needed, the Logistics Coordinator of the mission will define the codification system for the references inside a category.

2.4 UN reference
Most of United Nations humanitarian agencies have their internal system of reference for the articles they supply to their partners. References are indicated on the waybills or gift certificate. Action contre la Faim needs to follow these references to be able to produce reports for theses agencies. When existing, the UN reference will be mentioned on the various stock documents, otherwise the cells will be left blank.

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3 - In and out procedures

The storekeeper is responsible for the correct physical and administrative stock management. The storekeeper must respect the following procedures and obey to the instructions received from the logistician for deliveries IN and delivery OUT of the stock.

3.1 Deliveries IN
All incoming products must have a Delivery Note or an equivalent documentation when delivered to a warehouse. If the storekeeper has doubts on the quality or faces a documentation problem he/she can refuse the items and call immediately the logistician. 3.1.1 ACF Internal delivery (Other base or international procurement) The storekeeper has to: - Inspect the delivery: documentation, quantity and quality - Mention, if any, the observations or remarks before signing the Delivery Note - Archive the second sheet of the Delivery Note - Update or create the Stock cards (and Bin cards if needed) - Ask to the Logistics Coordinator the financial code if not mentioned on the transport documents - Store the products

3.1.2 ACF local purchase (The logistician or the purchaser delivers items recently purchased) The storekeeper has to: - Inspect the delivery: documentation, quantity and quality - Sign the appropriate cell in the Purchase Order - Archive the first sheet of the Purchase Order - Update or create the Stock cards (Bin cards if needed) - Store the products When delivering articles to the warehouse without the presence of the logistician or the purchaser, a supplier must have an External Order Form. The storekeeper will sign the waybill or debit note of the supplier and keep the 4th sheet of the EOF.
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The storekeeper has to call immediately the logistician if a supplier has no documentation.

3.1.3

Delivery from other IO / NGO

The storekeeper has to: - Inspect the delivery: documentation, quantity and quality - Mention if any the observations or remarks before signing the waybill - Archive the waybill (format depending on the organisation) - Ask to the Logistics Coordinator the financial code for this IO or NGO - Update or create the Stock cards (and Bin cards if needed) - Store the products

3.1.4

Return of products sent to a project

The team supervisor has to prepare a Delivery Note from the project to the warehouse The storekeeper has to: - Inspect the delivery: documentation, quantity and quality - Mention if any the observations or remarks before signing the Delivery Note - Update or create the Stock cards (and Bin cards if needed) Negative OUT entry - Store the products

3.2 Deliveries OUT

The Logistician-Administrator or the Capital Logistician are entitled to authorised stock releases. They can delegate this responsibility to an assistant. In their absence, they have to clarify the responsibilities and a temporary replacement has to be named. According to the base organisation, the replacement can be the direct assistant or the administrator assistant. The only document valid to allow a delivery is the Release Order. Without Release Order, the storekeeper has no authority to release an item. When receiving a Release Order the storekeeper has to: Prepare the Delivery Note
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Respect the financial code of the products Prepare the delivery (departure zone) or load the vehicle. Update the Stock card (without forgetting to mention the reference of the DN) Update and indicate possible comments on the Release Order

The storekeeper keeps the pending Delivery Note with the second sheet of the Release Order attached on it. The third sheet of the Release Order will go back to the logistician to update the order follow up.

4 - Respect of the financial allocation of products

When preparing the Release Order the logistician has to respect the earmarking of the products. Example: Cement bought for watsan activities by a donor cant be used for TFC rehabilitation funded by another donor.

If a product is in stock but not funded by the appropriate donor a loan is possible between stocks. If the logistician foresees that the reimbursement will not be possible a special request has to be made to the donor. Procedure for a loan / Example ECHO is funding a therapeutic programme in Bubanza base (Burundi) OFDA is funding a therapeutic programme in Kayanza base (Burundi) F100 stock funded by OFDA is 0, while stock purchased on ECHO is 250 boxes. An order for 300 boxes of F100 funded by OFDA is under process. Kayanza orders to the capital 150 boxes of therapeutic milk F100 1 - The logistician will issue a Release Order to loan 150 boxes from ECHO to OFDA stock The storekeeper will indicate the loan on the Stock cards (Out 150 for ECHO, In 150 for OFDA) 2 - The logistician will issue a normal Release Order to supply Kayanza with 150 cartons from the new OFDA stock. The storekeeper will deliver normally the 150 cartons to Kayanza
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 When receiving the order funded by OFDA, the storekeeper will enter 300 boxes on OFDA stock 3 - Then the logistician will issue a Release Order from OFDA stock to ECHO stock to reimburse ECHO stock with the exact amount borrowed: 150 boxes. The storekeeper will supply 150 boxes from ECHO stock to OFDA stock and update the Stock cards. Remark: In this case the change of the financial code of a product is authorized.

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5 - Inventory counting and administrative stock audit

The inventory counting is the counting of the products present in the warehouse. If relevant, it may include the weighting of all the articles or of a representative portion. The administrative stock audit is the verification of the coherence of IN and OUT documents with the information mentioned on the Stock card. When preparing a Stock report the storekeeper has to perform an inventory counting to guarantee the reliability of the report.. Every month and in the presence of the storekeeper, the logistician in charge of the stock has to perform an administrative stock audit and inventory counting on 5% (at least) of the products. Every 3 months and in the presence of the storekeeper, the logistician in charge of the stock has to conduct a complete inventory counting of the products.

The result of the inventory counting or administrative stock audit has to be mentioned on the Stock card. If any, the difference is entered in OUT or IN and the balance corrected. INVENTORY is written in the column Remarks. The person conducting the inventory must countersign the Stock card with the storekeeper.

6 - OD and stock management

The OD is a French accounting term that means Opration Diverse (miscellaneous operation). An OD is a retroactive change in the accountancy of a mission. Action contre la Faim mainly uses OD to correct accounting mistakes or to change the budgetary allocation of expenditures. The ODs interfere with the work of the Logistics Coordinator and the one of the storekeeper when the Administrator changes the budgetary allocation of a product in stock. The Administrator may decide to change the budgetary allocation of: - One or several products - The left over stock from a donor contract - A product used for a project different from its initial allocation and that will not be reimbursed
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After an OD, the storekeeper has to change the financial code of the products, and move them (if relevant) to the area of the new donor in the warehouse. Important note: When the product is no longer in stock and was already used for the initial project the OD to another institutional donor is not possible. In this case the OD wouldnt respect the accounting principle of reality. To keep a trace of the OD but to avoid the multiplication of documents the Logistics Coordinator will issue a Release Order mentioning the new financial code as destination to confirm the change of financial allocation to the storekeeper. Note: Theres no need for the storekeeper to issue a Delivery Note in the case of an OD.

7 - Essential documents for stock management

Refer to the utilisation note of each form for detailed explanations.

7.1 Stock card

The Stock card is the main and primary tool for stock management. For each product, the Stock card records the technical data and the detail of each movement. The Stock card must be updated after each movement. There is one Stock card per product. When theres no more space on stock card, the last balance has to be reported on a new Stock card. The old Stock card is kept attached to the new one. Non-active Stock cards: when the balance reaches 0 are kept in the same folder. Stock valorisation

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Action contre la Faim valorises the products in stock with the price of the last purchase in the currency of purchase. The initial purchase price is mentioned on the header of the Stock card. In case of stock replenishment the storekeeper indicates the new price in the Remarks column of the Stock card.

Returns Products When a project is supplied directly from a logistic warehouse, without a project stock it may happen that part of the goods requested are not used (Security margin not needed or beneficiaries absent). The products not used will return to the sending warehouse. In order to not overestimate the IN and OUT of a product when preparing a stock report the returns of products are registered as a negative OUT in the stock card

7.2 Release Order (RO)

The Release Order is the authorisation for any delivery or stock exit; this includes products sent to destruction. To simplify the filling, the Release Orders are prepared according to the destination of the products. Action contre la Faim uses a Release Order with three sheets: The original or first sheet stays with the logistician (The second and third sheets are given to the storekeeper to prepare the delivery) - The second is kept by the storekeeper and archived with the 1st sheet of the Delivery Note - The third sheet is sent back with delivery information to the logistician who files it by stapling it with the first sheet -

7.3 Delivery Note (DN)

The Delivery Note is a transportation document. From a storekeeper point of view the Delivery Note is the proof of the responsibility transfer.

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By signing the Delivery Note, the driver takes the responsibility of the products listed. The driver will keep this responsibility until the consignee signs the Delivery Note. The storekeeper has to be very cautious when preparing a Delivery Note, all the fields are important. Action contre la Faim uses a three sheet Delivery Note format: - The fist sheet is kept by the sender, who is generally the storekeeper. He/she fills it and countersigns it with the carrier. The storekeeper gives the second and third sheets to the driver; these sheets will accompany the products. - The second page is used for the delivery of the products. The consignee will check the delivery according to the information mentioned on the Delivery Note. The consignee will indicate remarks if any and sign the Delivery Note, by signing he/she takes the responsibility of the products. The consignee keeps the second page of the Delivery Note. - The third sheet is returned to the sender. The delivery is over only with the return of the last page of the Delivery Note. The storekeeper will attached the third sheet with the first and the Release Order and will archive this consignment. The driver or carrier is usually paid upon the return of the third sheet of the Delivery Note. Potential deductions for losses due to the negligence of the driver are based on this document.

7.4 Stock report

The Stock report provides per product and for the reporting period: - The quantity received, IN - The quantity delivered, OUT - The balance Additional and useful information, such as expiry date, doubts concerning the quality are also mentioned. With an accurate stock report the logistician knows the stock level per product, he/she knows approximately how long the stock can supply the projects. For any logistic stock in the Capital or on the bases, the storekeepers must prepare a Stock report. The longest periodicity of a Stock report is one month. The reporting period is from the 1st day of the month until the last day included.
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The Stock report has to be submitted to the logistician before the 3rd of the next month. According to the necessity, the logistician may ask for a shorter reporting period for a specific item category: weekly, twice a month. To simplify the management theres one Stock report file for: Food items Non-Food items Watsan items Food Security Fuel Vehicles spare-parts

7.5 The inspection form

The Inspection form is used for a systematic examination of deliveries. The storekeeper will record the result of a quantity and quality controls. These controls are performed during the delivery. The control method is based on a simplified methodology of sampling according to the number parcels of product received. - Delivery from1 to 10 parcels: control done on all the parcels - 10 to 100 parcels: control done on 10 parcels taken randomly - More than 100 parcels: control done on N bags, N being the whole number equal or immediately higher than the square root of the total number of parcels delivered. For the quantity controlled, the storekeeper will weight, count or measure the volume of the parcel. For the quality control, the storekeeper will perform a general visual, olfactory and tactile control. The storekeeper may also measure the moisture of the product and perform quick tests analysis.

8 - Additional documents for stock management

8.1 Distribution forms
The main specificities of distributions are:
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Restricted number of items Management of products returning to stock Massive volume

Forms for distribution, site reports and procedures are in the chapter15 food aid of the Kit Log.

8.2 The Loss Report

The Loss report is used to record the loss(es). The losses are all the exits other than the deliveries, distributions or returns of goods. They are thus the pilfering, thievery, damaged or expired products. The person who notices the loss prepares the Loss report in two copies. One copy of the Loss report is sent to the logistician in charge of the warehouse and the other one stay with the reporter. The Losses report can thus be done from the warehouses, especially to write the losses observed during the returns of third sheet of the Delivery Notes, or from the distribution point projects sites. The format used by Action contre la Faim can register losses for 3 products. A loss shall be registered with the date, the quantity, the reason for loss (+ the explanations) and the possible remarks. If there are several losses with various reasons, one line per reason has to be used. The total for the product will be mentioned in the appropriate cell. In case of damage products, the storekeeper has to wait for the authorisation before the destruction of the products.

8.3 Detail of deliveries

This report gives the detail of all deliveries for a product within a period of time. The detail of deliveries is an annex to the stock report The Logistics Coordinator defines per stock and per base the level of details he/she requires by adding columns to the format. The minimal precision is to have a detail per base and programs. Its a control tool to compare the OUT of a warehouse with the IN of another warehouse or project site.

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This report is not a consumption report. The products delivered to another base may be stored for a long time in stock or may have been transferred to another warehouse.

9 - Archiving of stock documents

All stock documents have to be kept and archived at least 4 years.

9.1 Filing at the warehouse

Stock card files: Archived per budget and per category of item (NFI, FI, etc) or more precise if needed. The non-active Stock cards (when the balance for an item reached 0) are kept in the same file. At least one file per budget The logistician decides the number of file to open according to the number of programs and bases. At least, therere always two files: Delivery IN and delivery OUT (with the release order). Delivery Note, Purchase Order or External Order Form, and then chronologically Delivery Notes (1st sheet and 3rd sheet) with the corresponding Release Order per destination and then chronologically

Delivery files:

Delivery IN: Delivery OUT:

Specific files are needed for UN agencies. These organisations provide Action Contre la Faim with in kind donations and Action contre la Faim has to submit them regular reports. To archive their waybills in a separate file makes this work easier. Stock report file: Copies of the Stock reports given to the logistician Delivery register: Its an optional and internal tool for the storekeeper, to register all the shipments organised or received. For each delivery IN or OUT the storekeeper writes: Date, hour, vehicle information, sender or consignee and DN ref.
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If the volume is significant the storekeeper have files for losses report/destruction and one file for products return from distribution.

9.2 Filing at the logistic department

Mission Stocks: mission Stock reports from the various warehouses on the The Logistic Coordinator keeps this file. Stock report file: All the stock reports from the various stocks on the base are archived in this (these) file(s). Gift & loan file: Gift certificate / temporary loans to other agencies + request from the agencies

Release Order file: All the Release Order (1st and 3rd sheet) per base/ program and per date.

10 - Standard forms within the Kit Log V 2.0

Delivery Note En Fr 2005.xls Delivery note utilisation En 2005.doc Inspection form En Fr 2005.xls Inspection form utilisation En 2005.doc Release Order En 2005.xls Release Order utilisation En 2005.doc Stock card En 2005.xls Stock card utilisation En 2005.doc Stock report En 2005.xls Stock report utilisation En 2005.doc

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