SSGC Internship Report on Finance Department

Sui Southern Gas Company Limited
Internship Report
Finance
Department
MUHAMMAD OSAMA SALEEM

UNIVERSITY OF KARACHI
SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 1

REPORT
Dedication
These Efforts are dedicated to

My Parents
&
My Teachers
Whose kind co-operation, Blessing, Help and

Inspiration gave impetus to complete this work

REPORT
ACKNOWLEDGEMENT
I am grateful to Almighty Allah who gave me all the strength, courage
preservation and patience to finish my Four weeks of Internship Program
at SSGC and in achieving my task fruitfully. Then I would like to extend
my gratitude to SSGC HR management especially to Mr.Akbar for giving
me an opportunity to enrich and upgrade my experience and skills. It was
quite a great experience for me to work with diversified and literati people
and helped me to understand cross-cultural-differences.
I would like to take this opportunity to formally thank Mr. Gulab Baloch
(Deputy Chief Manger-Fixed Asset), Mr. Saleem Durani (Manager -Store), MR. Anees Hussain (Chief Manager- Local Order Section) and Mr.
Wajeeh (Deputy Chief Manager- GDS) for providing their immense
support and unwavering guidance during conduct and completion of this
internship report on SSGC and it became possible for me to complete this
work within short time.
I would specially like to thank Ms. Aliya peerzada (Deputy ManagerGDS) and Mr. Waseem (Deputy Manager- Insurance Section) for their
constant support and guidance and for solving all my queries during the
course of my internship. It was because of their kind efforts that I have
been able to explore the practical world in a very professional manner

REPORT
NTRODUCTION
INTRODUCTION TO SSGC
Introduction:
Sui Southern Gas Company (SSGC) is Pakistans leading integrated gas Company.
The company is engaged in the business of transmission and distribution of natural
gas besides construction of high pressure transmission and low pressure distribution
systems.
SSGCL transmission system extends from Sui in Balochistan to Karachi in Sindh
comprising over 3,220 KM of high pressure pipeline ranging from 12 24 in
diameter. The distribution activities covering over 1200 towns in the Sindh and
Balochistan are organized through its regional offices. An average of about 388,828
million cubic feet (MMCFD) gas was sold in 2009-2010 to over 2.5 million industrial,
commercial and domestic consumers in these regions through a distribution network
of over 37,000 Km. The company also owns and operates the only gas meter
manufacturing plant in the country, having an annual production capacity of over
750,000 meters.
The Company has an authorized capital of Rs. 10 billion of which Rs 6.7 billion is
issued and fully paid up. The Government owns the majority of the shares which is
presently over 70%.
The Company is managed by an autonomous Board of Directors for policy guidelines
and overall control. Presently, SSGCs Board comprises of 14 members. The
Managing Director/Chief Executive is nominee of GOP and has been delegated with
such powers by the Board of Directors as are necessary to effective conduct the
business of the company.

REPORT

SSGC at a Glance:
The Company in its present shape was formed on March 30, 1989 following a series
of mergers of three pioneering companies, namely Sui Gas Transmission Company
Limited, Karachi Gas Company Limited and Indus Gas Company Limited.
Sui Gas Transmission Company Limited was formed in 1954 with the primary
responsibility of gas purification at the Sui field in Baluchistan and its transmission to
the consumption centers at Karachi. Two distribution companies were established in
1955 and were responsible for the distribution of gas to consumers in Karachi and in
other towns along the route of the transmission pipeline between Sui and Karachi. In
1985, these two distribution companies were merged to form Southern Gas Company
Limited and later, in 1989, Southern Gas Company Limited and Sui Gas Transmission
Company Limited were merged to form the Sui Southern Gas Company Limited.
Today, half a century of professionalism and progress has made the SSGC one of the
largest integrated natural gas transmission and distribution companies in Pakistan,
serving the entire Southern region of the country, comprising the provinces of Sindh
and Baluchistan.
Core Business:
The main activity of the company is transmission and distribution of gas in Sindh and
Baluchistan.
Secondary Activities:
The company is also engaged in certain activities related to the gas business including
manufacturing and sale of gas meters and construction contracts for lying of pipelines.
Thus the core functions of SSGC can be elaborated as under
Purification of Natural gas from Sui Fields
Transmission of Natural Gas from Pirkoh, Sari Hundi, Badin, KandhKot,
Mari, Daru and Kadanwari gas fields
Distribution of Gas in Sindh and Baluchistan provinces
Manufacturing and sale of gas meters
Construction contracts of laying pipelines

REPORT
SSGCs VISION
To be a model utility, providing quality service by maintaining a high level of ethical
and professional standards and through the optimum use of resources.
SSGCs MISSION
To meet the energy requirements of customers through reliable, environment-friendly
and sustainable supply of natural gas, while conducting company business
professionally, efficiently, ethically and with responsibility to all our stakeholders,
community and the nation.
Organizational Structure:
The Company is organized into six functional divisions -Transmission, Distribution,
Commercial, Engineering Services, Management Services, and Finance. Each
division is headed
by a Senior General Manager assisted by a team of professional staff, with the
exception of Finance, which is headed by the Deputy Managing Director. Policy
matters relating to the natural gas sector are handled by the GOP. OGRA is
responsible for regulation, pricing, revenue determination and compliance to service
standards. The Board of Directors has the overall responsibility for the management
and control over the Company. The management enjoys operational autonomy. The \
major portion of the work force consists of technically qualified and skilled personnel.

REPORT
ORGANISATIONAL CHART

REPORT
FUTURE OUTLOOK
The Company is pursuing an ambitious five year development and expansion plan
estimated at Rs 42.9 billion. Key objectives of the strategic plan for the next five
years (2005-06 to 2009-10) are the following:
Expansion of transmission network by 608 Kms from 2,942 km in 2005 to
3,550 km by 2010, enhancing capacity from 1,300 MMCFD in 2005 to 1,700
MMCFD by 2010.
Expansion of distribution network and supply mains by 5,236 km from 25,764
km in 2005 to 31,000 km by 2010 connecting 600 new towns and villages in
Sindh and Baluchistan.
Enhancement of gas supply to power plants, industrial and commercial sectors
including supply of gas to previously deprived areas in the domestic sector.
Increase of the customer base from nearly 1.8 million to 2.2 million by adding
447,000 new customers to the Companys system.
Consistent appreciation in shareholders value by increasing the companys
asset base and significant improvement in productivity and efficiency.
Focus on improved, friendly and efficient customer services under the vision
of Service with a smile.
Establishment of 16 fully automated (additional 8 in progress) on line
customer facilitation centres.
Multiple bill payment options and channels (ATM, Call Centres, ORIX POS,
Internet, Drop Boxes, and NADRA-Kiosk).
Latest technology digital prepaid meters with improvement of call centres to
include an online customer information system.

REPORT

Revamp the current business processes, to improve company efficiency and
implement ERP, CIS, GIS and the best business policies for ISO 9000
certification.
Increase surveillance and introduce an automated emergency response system
(ERS) and SCADA for the security of company assets including the
transmission and distribution networks.
Improve the quality of human resource through career planning, training of
employees and development of management;
Implement environment management system, occupational health and safety
system as required under Certification ISO 14001 and OHSAS 18001
standards;
Set up Enterprise Information System (EIS) in all areas of business using state
of the art technology to make SSGC the Most IT Enabled Company;
Human resource development and empowerment of employees through career
planning and continuous management/vocational training.
Community support services and corporate communication initiatives to meet
the national and social responsibilities, as a good corporate citizen.
STRATEGIES
The company has moved beyond basic reengineering as it builds and reinforces
culture change by creating performance opportunities, developing Human
Resources and pursuing overall business excellence.
The company identified successfully different layers of change that needed to be
managed concurrently for large projects to be implemented on schedule and
within budget. Within the induction of new, improved business process, an
appreciable change in productivity was achieved.
The company has taken the lead in integrating Change Management within its
people, processes and technology. Optimizing market flexibility and maximizing
REPORT

return on investment from major change initiatives are key success factor for the
company.
The company has adopted an aggressive approach to empower the executives and
to create awareness in the rank and file for changing the routine business
processes with people-centric work methodology with focus on moving over to
best business practices.
The SSGC has pioneered efforts for deployment of a cost-conscious and
performance-based culture and empowerment of the employees to provide for
achievement and excellent at all levels.
Expansion of distribution and transmission network for enhancement of gas
supply to power plants, industries and commercial sector including supply of gas
to previously deprived areas in the domestic sector.
Customer satisfaction, innovation, quality services and promotion of service with
a smile culture.
Consistent appreciation in shareholders value by increasing the companys asset
base and significant improvement in productivity and efficiency.
Business Process Re-engineering (BPR), re-structuring of select departments and
implementation of ERP to provide effective M.I.S for business operations and
control.
Enterprise Information System (EIS) and technology implementation in all areas
of business to make and maintain SSGC the most IT enabled company.
Human resource development and empowerment of employees through career
planning and management / vocational training.
Improvement in reliability and security system.
Improvement in customer services through additional Customer Facilitation
Centers, installation of pre-paid meters, and improved bill delivery.
Community support services and environmental protection initiative to meet the
national and social responsibilities as a good corporate citizen.
COMPANYS OBJECTIVE
The Company aims to supply natural gas wherever there is sufficient load to justify
the cost of infrastructure. In many places the gas network is being expanded to meet
REPORT

economic and social requirements through active funding support from the Federal
and Provincial governments. In 2003, the Company launched a comprehensive fiveyear gas network development and expansion
Plan to connect hundreds of small towns and villages in remote areas of Sindh and
Baluchistan, which currently are deprived of piped natural gas.
Every year, the Company adds nearly 75,000 new customers (industrial,
commercial & domestic) to its customer base and lays hundreds of kilometers.
Transmission pipelines and distribution network and installs other facilities such
as metering / billing stations in its system using its staff of technically qualified
and skilled personnel.
Personal Introduction:
Currently, I have Cleared B.Com from a renowned university of Pakistan, University
of Karachi, Karachi. I have recently got admission in MBA from Iqra University
Karachi. I have done introductory courses of Management, Economics, Marketing,
Finance and Accounting. However, I have developed substantial interest in Finance
REPORT

and therefore, plan to do my MBA in Finance. I have a keen interest in doing
internship in SSGC (Sui Southern Gas Company) as it would be beneficial for me in
future and it is the leading and best company.
My internship experience at SSGC has provided me with valuable insight and has
helped me in increasing my knowledge of the subject. It has introduced me to the
operations that take place in the professional world and has provided me with the
opportunity to work in a dynamic environment where I can exploit my concepts.
Personal Data:
Father Name:
Date of Birth:
NIC No:
Marital Status:
Religion:
Nationality:
Cell No:
Email Address:
M.Saleem Qasim
5th April, 1993
42201-5940244-7
Single
Islam
Pakistani
0342-2339986
sam_saleem97@yahoo.com
Computer Skills:
Oracle finance Software & Accounting Softwares i.e. Peach tree & Quick Book
MS Office Suite
Internet Surfing/Browsing
MY EXPERIENCE IN SSGC
Purpose of the Internship:

REPORT

The purpose of internship is to learn the skills regarding working in industries,
behavioral conduct, know-how about the corporate culture & Organizational
environment. It was essential to me that I enter in highly regarded or reputable
organization. During our BBA degree I have been studying the different business
related subjects, than as the time I could gain real experience. Throughout Six weeks I
learnt a lot of things regarding my specialization, which were quite informative and
bit challenging. Different projects & assignments had promoted me to meet
challenges and be confident.
Personal Learning
Corporate Culture; Understanding:
As the basic purpose of internship is the introduction of corporate culture to the
students. It aims at understanding how the things are practically going on in the
organizations, how the theories we read in books are implemented and executed. In
this regard, I learnt a lot in the dynamic organization of Pakistan SSGC. I learnt the
core values of the organization. The meeting and communication with the diverse
people made me understand and adjust myself with the different people working in
the organization. More over, the dynamic employees shared their ups and downs and
other different experiences of their corporate life that has been a great learning for me.
Corporate Social Responsibility:

CSR was mere a term for me as I used to come across with this topic in my texts. But
I came to realize its importance when one of the groups from internees look this
challenge and firmly decided to visit the hospital where nobody wants to go.
Successful arrangement of this event was a empirical example of Event
Management full of lesson, in which I participated for a good cause (above all) we
were all basking in the glory of the success of this event.
As I said SSGC is our mother and Caring Organization was always there to facilitate
us. SSGC is very keenly fulfilling its corporate social responsibility with its loyal and
committed workforce along with energetic etc. and enthusiastic ambassadors
(internees).
Punctuality:
Punctuality the first and foremost things which is essential for a professional at work
i.e. punctuality and the very first thing I have learnt in SSGC i.e. previously I have
heard that famous quotation which goes like that late comer must suffer I did not
know in terms of what he may suffer. At SSGC I saw its practical exhibition in terms
of not paying the attention of BOSS or he may not learn as he can for his slackness for
being late, SSGC made me punctual and made me realized that TIME IS MONEY.
Leading & Becoming Effective Team Player:

REPORT

Blending with different people becoming social able and building affinity with them
was an insurmountable task for me. SSGC has bridged this unbridgeable gap in my
personality and enabled me to adjust myself in any environment for becoming effect
team player I have learnt the requisites that:
I.
II.
Respect each team member

Respect the way people work
III.
Be patient and listen to all and play your part
IV.
Appreciate noble / gracious ideas presented by any your team member and try
to become part of the solution not part of the problem.
V.
Be flexible and show sensitivity for others feelings.

REPORT
OVERVIEW OF
FINANCE
Overview of the Finance Department
DEPARTMENT
FINANCE
Finance
Treasury
Accounts
Payroll
Cash & Bank
Cost & Revenue

Budget
Insurance
Loans
Fixed Assets
Payments
Investments
MIS
Gas Purchase
Gas Sales
Distribution
System
Transmission
Project
Taxation
Financial
Feasibilities
Revenue Control

REPORT
TREASURY FUNCTION
The Treasury Function Department of the finance department basically deals with the
disbursements, collection, receipts, management of funds, payment of foreign or
domestic loans, revenue control and reconciliation of bank and customer accounts. In
short, treasury functions deals with the flow of money either in the form of inflows or
outflows. An important task of the Treasury function department is to keep a check on
the companys current liabilities account and make sure that their current liabilities do
not exceed their current inflows of cash.
The treasury function department can be further subdivided into five major categories,
which are somewhat interrelated. The division is as follows:
Cash & Bank
Loan Payments and Funds Management
Revenue Control
Taxation
Investments
All these sections have separate section heads who are responsible for the activities of
the people working in their section. These section heads report to Chief Manager
(CM) Treasury Function who is responsible for the overall activities of the treasury
function Department.
FINANCE DEPARTMENT
The Finance Department is further subdivided into sections, which includes the
following:
Payroll
Fixed Assets
Insurance
Gas Purchase
Transmission Project
Payments

REPORT
MAJOR ACCOUNTING POLICIES

Property, Plant & Equipments:
Assets are not revalued and historical cost is taken into account. Property, plant
and equipment except freehold land, leasehold land and capital work in progress
are stated at cost less accumulated depreciation. Freehold land, leasehold land and
capital work in progress are stated at cost
Straight line Depreciation Policy is being applied over the Assets

Stock-in-trade
The stock in trade comprises of Gas in pipelines and Meter manufacturing
division.
Stock of Gas in transmission pipelines is valued at lower of cost determined under

the weighted average basis and net realizable value whereas the materials for
meter manufacturing division is valued at lower of moving average cost and net
realizable value.
Stores, Spares and Loose Tools:

These are valued at cost determined under the moving average basis less impairment
losses, if any. Goods in transit are valued at cost incurred up to the balance sheet date
Trade Debts:
Trade debts are carried at cost less provision for doubtful debts, if any. Balances
considered bad and irrecoverable are written off when identified.
Trade and Other Payables:

Liabilities for trade and other payables are carried at cost which is the fair value of the
consideration to be paid in the future for goods and services received.

REPORT

Deferred Credit:
Amount received from customers and the government as contributions and grants for
providing the service connections, extension of gas mains, lying of transmission lines,
etc are deferred and are recognized in the profit and loss account over the useful life
of the related assets.
Revenue Recognition:
Revenue from Gas sales is recognized on the basis of gas supplied to customers at
rates periodically announced by the Oil and Gas Regulatory Authority (OGRA).
The meter rental is recognized monthly at specified rates for various categories of
customers on an accrual basis whereas the sale of meters and gas condensate is
recognized on dispatch to the customers.
Deferred credit income is amortized to the profit and loss account over the useful
life of the related assets. Dividend income on equity investments is recorded on
accrual basis.
However the company is required to earn a minimum annual return before

taxation of 17% per annum o the net average operating fixed assets (net of
deferred credit) for the year. Income earned in excess or short of the above
guaranteed return is payable to or recoverable from the Government of Pakistan
and is adjusted from or to the gas development surcharge payable to or receivable
from GOP.
Long Term Deposit:

Long Term deposits consist of security deposits from Gas customers and gas
contractors.
Government of Pakistan. These deposits are repayable and adjustable on the

disconnection of gas supply.
Security deposits from contractors are free of mark-up and refundable on the
cancellation of contract.
REPORT
AREAS OF WORKING
I sought opportunity to join SSGC to upgrade my skills in multi-dimensional
approach to the section of the Finance Department. Whatever I attained there is
elaborated as under:
Pre-Audit Section
Fixed Asset
General Ledger
Inventory Accounting
Insurance Section
Project Section

REPORT
FIXED ASSEST
Responsibilities of Fixed Assets:
Following are the main responsibilities of fixed assets:
1. To maintain the capitalization, depreciation, retirement and disposal of all the
fixed assets.
2. Preparation of capitalization and WIP schedules of all the companies i.e. Karachi
distribution, Hyderabad distribution, Baluchistan distribution, Transmission and
Head Office.
3. Prepare quarterly, half yearly and yearly accounts and schedules of organization.
FIXED ASSET ADITION PROCESS

Capitalization:
Whenever a budget is to be prepared for any department, the budget section notifies
the department to prepare list of assets required by them for the coming year. After the
approval of the budget, the concerned department will be only allowed to purchase the
assets listed in the budget for the whole year.
In order to purchase an asset, fixed asset requisition (FAR) is required to be filed by
concerned department, which should be approved by the head of that department.
FAR contains details of assets required by the department.
The FAR is then forwarded to Material Management department, where Deputy
Manager checks whether the FAR falls within the budget or not. If the amount for the
required asset is available in the budget then the Material Management department
invites quotations through tender (if not available in store) and on the basis of
commercial and technical evaluation and lowest bidders, a supplier is selected (all
such procedures documented in Evaluation Report) and then Purchase order (PO) is
prepared and sent to supplier.
All assets are received by the KT stores department, where quality inspection is
conducted (however not documented) and then a Material Receiving Statement
(MRS) is generated and a copy of which is forwarded to the finance department.
Depreciation:
Once an asset has been capitalized, working for its depreciation starts. Full year
depreciation is charged for the first year regardless of its purchase data. The company
uses the straight line method of depreciating except for meter plant, where reducing
balance method is used. Depreciation rates differ for different assets. It even differs
for same assets in different cities.
In the certain situation we call for making adjustments e.g. transfer of an asset from
one unit to another, different between assets in books and its physical existence etc.

REPORT
FLOW CHART OF FIXED ASSET ADITION
Approval
Approval
In
In
Budget
Budget
Intent
Intent
Letter
Is
Letter
Sent To Is
Sent To
Supplier
Supplier
****PBG
****PBG
Is
Is
Submitte
Submitte
d By
d By
Supplier
Supplier
Asset Is
Asset Is
Capitalize
Capitalize
d
d
* Department
** Fixed Asset Requisition
*** Material Management
****Performance Bank Guarantee
User
User
*Deptt.
*Deptt.
Sent
**FAR
Sent
**FAR
To
***M.M
To ***M.M
Evaluatio
nEvaluatio
Report
n Report
Is
Is
Prepared
Prepared
Bid
Bid
Opening
Opening
For
For
Purchase
Purchase
Quotatio
Quotatio
n Is
n Is
Received
Received
From
From
Supplier
Supplier
Purchase
Purchase
Order
Order
Sent
To
Sent
To
Supplier
Supplier
Asset Is
Asset Is
Received
Received
By
R&D
ByKT
R&D
At
At KT
Charge
Charge
To
To
Asset
Asset
Clearing
Clearing
Account
Account
Material
Material
Receiving
Receiving
Statemen
Statemen
t Is
t Is
Prepared
Prepared
Work In
Work In
Progress
Progress
(In case of
(In case of
construction)
construction)

REPORT

REPORT
Fixed Asset Retirement process

After the completion of life of asset which is fixed by company we retire it. 1 st the
Assets Retirement Requisition (ARA) is prepared by the user department and it is sent
to the fixed asset section of finance to retire that asset. The company SSGCs follows
certain policies for retire of asset e.g. only those asset which have a zero book value
can be retired. After checking the book value the inspection team is to be formulated.
That inspection team inspects the asset, which is to be retired for verification of the
condition of the asset. After inspection the report sent to the fixed asset section along
with ARA. It is approved / disapproved on the basis of inspection report by GM,
DGM and MD. After approval the asset sent to store at Karachi Terminal (KT) for
disposal. In case an employee of the company buys it, it is sold on written down value
or at 7.5% of its cost, whichever is higher. And some old assets, which are fully
scraped and not present physically, are deleted from the books through approval of the
management.
Fixed Assets Retirement Process

Asset Retirement
Inspection of the
Advice prepared by
asset to be retired
the user department
is conducted for
and sent to the
verification of the
inventory section
condition of that
Asset sent to
Retirement advice
is approved /
asset
store at KT for
disposal
Section Inspection
disapproved on the
report sent to the
basis of inspection
inventory along
report by GM, DGM
with ARA
and MD

REPORT
FIXED ASSET ACCOUNTING CYCLE

Module
Step
Accounting
Dr.
/Cr.
Contr
a
Purchasing
Requsition
Purchasing
Requisition
Inventory
Receiving
Inventory Receiving Account

AP Accrual Account
3081111
2073214
C1
C2
Inventory
Deliver
Asset Clearing Account

Inventory Receiving Account
3011999
3081111
C3
C1
AP
Invoice
AP Accrual Account
Liability Account
2073214
2073201
C2
C4
AP
Payment
Liability Account
Bank
2073201
Bank a/c.
C4
Asset Cost Account

Asset Clearing Account
Dep. Exp
Acc. Dep.
Asset Cost
3011999
5062101
3012117
DR
C3
DR
3012117
3011117
3013991
4026401
DR
3012117
3011117
3013991
4026401
DR
No Accounting
No Accounting
FA ADDITION
Assets
Assets
Assets
Assets
FA MODULE
FA MODULE
FA MODULE
FA MODULE
CR
CR
DISPOSAL OF ASSETS (IN CASE OF PROFIT)

Assets
Assets
Assets
Assets
FA MODULE
FA MODULE
FA MODULE
FA MODULE
Acc. Dep.
Asset Cost Account
Proceed from sale of FA
Profit on sale of FA
CR
DR
CR
DISPOSAL OF ASSETS (IN CASE OF LOSS)

Assets
Assets
Assets
Assets
FA MODULE
FA MODULE
FA MODULE
FA MODULE
Acc. Dep.
Asset Cost Account
Proceed from sale of FA
Loss on sale of FA
CR
DR
DR

REPORT
GENERAL LEDGER SECTION

Function:
Processing of all journal voucher (JV) from different section and location in
finance department
Resolution of queries raised by the ERP system during JV processing
Posting of all financial modules to general ledger
Processing of reports from oracle on monthly, quarterly, yearly basis for top
management
Processing of reports from oracle on monthly, quarterly, yearly basis for oil and
gas regulatory authority (OGRA)
Purpose:
To maintain proper and accurate, books of accounts.
To facilitate and co-ordinate the annual audit
To comply with the policies and the procedure notified by OGRA from time to
time.
To comply with the policies and the procedure notified by Security and Exchange
Commission of Pakistan (SECP).
To report the results to board of directors and share holders of the company

REPORT

The General Ledger Accounting Cycle

REPORT

Follow these steps to enter, maintain, and report on actual accounting information for
your enterprise:
1. Open an accounting period.
2. Enter manual journal entries, including:
Standard journal entries
Foreign and dual currency journal entries
Statistical journal entries
Intercompany journal entries
3. Import journals from sub ledgers. If you encounter an error when trying to import
a sub ledger journal, you can correct the import data and rerun journal import.
4. Define recurring journal formulas for transactions that have a common format or
that you enter frequently. You can also create recurring journal formulas to create
allocation entries.
You can use recurring journals to create three types of journal entries:
Skeleton entries affect the same accounts each period, but have different
posting amounts.
Standard recurring journal entries use the same accounts and amounts each
period.
Formula entries use formulas to calculate journal amounts that vary from
period to period.
5. Define Misallocation formulas to allocate a cost pool across a group of
departments, companies, etc.
6. Generate recurring journal and Misallocation journal batches based on formulas
you defined.
7. Review the details of your unrecorded journal batches.
To view and optionally change unrecorded journal batches online, use the
Enter Journals window.
To view unrecorded journal batch detail online, use the Journal Inquiry
window.
To print a report showing unrecorded batch detail, produce a Journals General report (set the Posting Status parameter to unrecorded).
8. Edit unrecorded journals to change information about an unrecorded batch or its
journal detail, including the batch period and the journal currency.
9. Post your journal batches manually or automatically.
10. Check for posting errors. General Ledger automatically produces a Posting
Execution Report so you can check the results of your posting. This report notifies
you of any errors.
11. Reverse journals. You can reverse a posted or unrecorded journal entry. Once you
assign a reversing period to the journal, generate and post the reversing batch.
12. Revalue your foreign-denominated assets and liabilities to reflect exchange rate
fluctuations at the end of each accounting period.
13. Translate your actual account balances to any foreign currency for reporting
purposes.
14. Consolidate sets of books by defining and running a consolidation. You can
consolidate sets of books that have different charts of accounts and calendars.
REPORT

15. Produce financial reports and perform online inquiries to review current account
balances.
Review account balances online using the Account Inquiry window.
Review posted journal details in the Posted Journals Report, as well as in the
General Ledger and Account Analysis reports.
You can also define an unlimited variety of custom reports using the Financial
Statement Generator to review account balances in the format of your choice.
16. Enter journals to clear suspense account balances. Examine General Ledger and
Account Analysis reports to identify the source of suspense account entries.
17. Close the current accounting period.
18. Open the next accounting period.
GAS
DISTRIBUTION
SYSTEM
REPORT
(GDS)
GDS - An Introduction:
The Gas Distribution System (GDS) is one of the vital sections of SSGCs Finance
Department. The basic task of the Finance departments GDS is to perform all the
accounting activities related to the expansion of distribution and transmission network
for enhancement of gas supply to power plants, industries, domestic and commercial
sector including supply of gas to previously deprived areas in the domestic sector.
Distribution System accounting include development of mains laying rates (MLR) all
region rectification and monitoring of Distribution Budget of all region and project
accounting related to distribution Projects.
For achieving the above mentioned targets the GDS of the finance department
performs a number of activities. These include preparation of feasibilities of
Transmission projects and Gas fields under various options, preparation and
monitoring of Annual Distribution budgets for all new town and villages, uploading
the budget of each project on ERP system, processing Rehabilitation, Reinforcement
and New towns schemes of all regions including re-appropriation of Budget and
settling issues related to Distribution of all regions, maintaining funds position related
to New Towns & Villages and coordinating with Sales Department and Ministry of
Petroleum & Natural Resources (MNPR) in this regard . It includes submission of
performance reports/ status reports to MNPR through Sales.
Infrastructure:
SSGCL transmission system extends from Sui in Baluchistan to Karachi in Sindh
comprising over 3,200 KM of high pressure pipeline ranging from 12-24" in diameter.
The distribution activities covering over 1200 towns in the Sindh and Baluchistan are
organized through its regional offices. An average of about 378,468 million cubic feet
(MMCF) gas was sold in 2007-08 to over 2.040 million customers. It includes 3,448
industrial, 22,192 commercial and 2,014,827 domestic consumers in these regions
through a distribution network of over 31,877 Km. The company also owns and
operates the only gas meter manufacturing plant in the country, having an annual
production capacity of over 550,150 meters.

REPORT
Responsibilities of GDS:
The issuance of Job cards, Journalisation, reconciliation of deposit is also the
responsibility of the finance department. For the GDS, it is also necessary to ensure
that the amount transferred to Deferred Credit with respect GOP funds & customers
advance is in accordance with IAS & Companys policy.
Preparation of financial feasibilities is one of the major tasks of this department.
Feasibility reports are prepared for providing recommendations to the managements
regarding the approval of various projects. These financial feasibilities and reports are
prepared for the following projects.
For supply of Gas to Industrial, Commercial, CNG stations and Co-operative Housing
society on cost sharing basis.
Transmission projects
Supply of gas from Gas fields
Construction of pipeline and to received pipeline rental.
Supply of gas to New towns & villages on request of GOP
Industrial estate
Other Capital project
This section consists of one Deputy Chief Manager and two Deputy Manager. Two
ERP executives are also a part of the GDS team.

REPORT
PROCESS OF NEW PROJECT
Sales Dept. Received Request

With Processing Fee
Visit The Customer Premises
Determine The Cost Of Customer

Connection
Approval By GM Sales
Quotation Send To Customer
Customer Pay The Advance
Receipt Send To The Finance
Department
Finance Dept. Issues The Job
Card
Job Card Send To The SITE
Through Sales Dept.
SITE Team Start The Work
Once The Job Has Completed, Job
Card Send To The Finance Dept.
Through Sales
Finalize The Project By Finance
Dept
REPORT

REPORT
GDS ACCOUNTING CYCLE AND MANDATORY

STEPS
Cash & Bank
Bank
Dr.
Advance
Cr.
Store
Project
Dr.
Store
Cr.
GDS
Asset/Revenue
Dr.
Project
Advance
Cr.
Dr.
Loan/Deferred Credit/Installation Cost

REPORT
Cr.
Core areas of DSS
New Town and

villages
Existing Areas
Functions of DSS Existing areas

Mains Extension
Service connections
Meter Installation
Other CAPEX
Recoverable Jobs
The core activities of DSS can be broadly divided into two major areas
Existing Areas
New Town and Villages
DSS works for supply of gas to the previously derived areas which includes many
towns and villages and also for the enhancement of the existing gas supply system to
our industrial, domestic and commercial sector. However the detail process is
discussed in the later part of the report
REPORT
Mains Extensions for Domestic /

Commercial Customers
Main
Extensions
Supply/ Feeder
Mains
Distribution Mains
Major Mains
Minor Mains
Paid Mains
Main extension can be classified into two major categories

Supply/ Feeder Mains
Distribution Mains
Supply/ Feeder Mains:

These Mains are generally for the supply of gas to a particular area and then other
connection are further provided from the Supply Main or Transmission Pipeline.
Distribution Mains:
Distribution Mains consist of network of pipes laid in streets and towns for providing
gas to the customers.
These mains are constructed from the outlet of T.B.S / from the SSGC system up to
the prospective consumer premises i.e. in streets of Cities, Towns & Villages. The
Normal pressure of gas is maintained from 08 to 60 PSIG.

REPORT

Every year Physical Targets are fixed by the company, for the expansion of the
distribution network of mains for te supply of gas to residential, commercial and
industrial areas. These targets and the amount involved are allocated in the Annual
Budget, which is approved by the Board of Directors. Details of physical targets are
proposed by the Sales department, which contains capital cost/ length and diameter of
mains to be extended and number of gas connections to be processed during the
financial year. Physical targets for the following are approved by the Companys
Board for each financial year.
The Distribution mains can be further classified into three categories:
Major Mains
Minor Mains
Paid Mains
Major Mains:
As per present practice of the company, Mains extension of 1 km and above for any
particular scheme or area is categorized as Major Main. All such cases are approved
by the management once in a financial year in the Annual Development Plan.
Minor Mains:
In cases, where length of mains extension required, is less than 1Km then it is
categorized as Minor Main. In this case also, it is necessary to get certain kilometers
approved by the management. However, these cases are processed throughout the year
under the limit of approval obtained.
Paid Mains:
When the case does not fall under the CCE criteria and the capital cost per consumer
far exceeds CCE criteria then the case is treated as PAID MAINS.
Under this case an option will be given to the customer to either process the project
through cost sharing or on self-finance basis, if they agree.

REPORT
Standard Procedures Applicable to the

Process of Distribution of Gas
Standard Procedures
Request for mains
Review of request
Planning and site survey
Cost calculation
Feasibility
Payments
Issuance of job card
Execution of the job
Commissioning advice
Issuance of Circulars
Booking of cost

REPORT

Request for Mains:
Request for mains extension in existing areas may be placed by:
District Governments
Parliamentarians
Residents
Review of Request:
The request will be review for the completion of documents. Sales department ensures
that area drawing is
Available
Not available
If the area drawing is available then the case is forward to planning for the survey of
site.
If the drawing is not available then sales department informs the customer to arrange
the area drawing. If the customer arranges the area drawing then the case forward to
planning for site survey otherwise the case will not be further proceed.
Sales department forwards the case to planning department on Book No.1
Planning and Site Survey:

Survey is conducted by planning department in order to determine the work involved.
After performing the survey of the site, planning department informs the sales
department about the case on Book No. 2
Cost Calculation:
After receiving the survey proposal, sales departments works out the estimated cost of
the case according to the data provided by the planning department. Sales department
checks that whether the extension is for major mains or minor mains.
If the case is for the extension of major mains and it is feasible then the case is
included in the ANNUAL DEVELOPMENT PROGRAMS PENDING file.
The criteria for checking the feasibility of the case is fixed by the CABINET
COMMITTEE ON ENERGY (CCE) are as under:
PROVINCE
CAPITAL COST PER CONSUMER
Punjab and Sindh
Rs.20,000
N.W.F.P
Rs.40,000
Balochistan
Rs.100,000
If the case is falling under the above criteria then it is treated as feasible. A list is
prepared by the sales department on the basis of least cost method (projects are
REPORT

arranged in order of the least cost). The list is then forwarded for the approval of the
management. After approval list is sent to finance department for the processing of
job cards.
If the case is not falling under the above criteria and the capital cost per consumer is
far exceeding CCE criteria then the case shall be treated as PAID MAINS.
Under this case an option will be given to the customer that the project may be
processed through cost sharing / self-finance basis if they agree.
Approval of Project:
The criterion for the approval of the project is as under:
CASE I
CASE II
PROJECT COST
Less than or equal to 1 million
More than 1 million
Theses projects requires approval
Theses projects are forwarded to
from two SGMs
finance department for the preparation
- SGM ( Customer Services)
and approval of financial feasibility of
- SGM (Transmission &
the project
Distribution)
Feasibility Study:
Following are the steps involved in the process of feasibility.
Letter from
Sales department
Preparation and
approval of feasibility
Letter to sales
Department
Step (a): Letter from sales department:

Sales Department sends a request letter to finance department to carry out the
financial feasibility of the project. DGM Sales forwards the letter of request to GM
Accounts, which forward to DCM accounts. DCM accounts after studying the case
forwards it to DM accounts whose job is to prepare the feasibility report.

REPORT

Step (b): Preparation and Approval of Feasibility
Study:
DM accounts prepare a feasibility report. DM accounts calculate the impact on Gas
Development Surcharge (GDS). And works out the whether the cost of project being
financed by the company or the customer as per the mentioned policy of the company.
Category
of
Connection
Industrial /
CNG
connections
in existing
areas / new
areas
Impact on GDS
after Allocating
for Regulatory
Return
Irrespective of
Impact
Full Positive
Partial Positive
Negative
Project
Cost
Policy
Project
Cost is lees
than Rs.1
million
100% project cost

financed by the company
Project cost
is more
than Rs.1
million
50% project financed by

the customer refundable
over 48 monthly
installments with nominal
interest.
50% project financed by
the customer refundable
over 48 monthly
installments with nominal
interest.
100% cost of mains
recovered from customer
as non-refundable
Project Cost includes:

Cost of Mains including DIRECT DEPARTMENTAL COST (DDC)
Cost of CUSTOMER METER STATION (CMS)
Cost of TOWN BORDER STATION (TBS) / PRESSURE REDUCING
STATION (PRS) if dedicated to the customer
After preparation of feasibility report the feasibility report requires approval from the
management. If the cost of project is less than or equal to 2.5 million then CFO has
the authority to approve the case other wise the case shall be approved by the MD.
Step (c): Letter to Sales Department:

After approval of feasibility report DSS issues a letter to sales department informing
about the approval of the project and the amount to be received from the customer as
refundable / non-refundable advance as per the policy of the company.
REPORT

Issuance of Job Card:
The list is sent to finance department for the preparation of job cards.
Job card is prepared and sent to sales department. Sales department sends job card to
planning for the execution of work.
Execution of Job:
The job is executed with the involvement of Planning and Construction.
Commissioning Advice:
The construction department sends a commissioning advice to sales department to
inform that the area is now on gas.
Issue of Circulars:
Sales department issues circulars to registered contractors stating that they can start
the sales activities. This circular is only issued in the case of major mains.
Booking of Cost:
All executed job cards are sent to finance department along with all material
requisitions and other coast details for the booking of cost of the scheme.

REPORT
STORES SECTION
The store is responsible for receiving, keeping and sending all the necessary materials
the company uses for its operations in various locations throughout the country. All
the items have a 9-digit index number.
Purpose:
To check the store balances, maintain and control the records of every kind of
stock/material placed in stores at different locations of company.
Here, in SSGC Head Office record of each store all location in company is controlled
and checked for proper receipt and issue of items.
Working:
1. Extracting stores balances in ERP.
2. Checking of stores balances with ledger balances on ERP.
3. Reconciliation store stock loan balances with ledger balances for the more
accuracy.
4. Checking of miscellaneous reports of stores balances for confirmation.
5. Preparation of reports of stores stock on quarterly, half yearly and annually.
Functions Performed By Company Stores:

Major functions are performed by company includes:
Receipt of stores
Issuance of stores for Distribution Projects
Issuance of stores for Transmission Projects
Issuance of stores for Meter Plant Projects
In order to fulfill these functions, company has several stores ate different locations.
And here we go in the detail of these stores by using tables.

REPORT
The following chart shows the different documents, which causes

inflows and outflows from the stores.
Debit
Adjustment
Receiving
Statement
Local / Imports
NFLOWS
Voucher
INFLOWS
Return
Vouchers
STORE
OUFLOWS
Material
Requisition
Form
Credit
Meter
Requisition
Form
OUT
Adjustment
Voucher

REPORT
MAJOR FUNCTIONS OF COMPANY
COMPANY
DISTRIBUTION
TRANSMISSIO
N
METER PLANT
DISTRIBUTION STORES
DISTRIBU-TION
STORE
KARACHI
SINDH
QUETTA
MAIN STORE
SITE
HYDERABAD
SUKKUR
QNGDP
GULSHAN
STORE
NAWABSHAH
LARKANA
ST. QUETTA
ST.STORE SITE
ST. HYDERABAD
ST. SUKKUR
DISTRICT SITE
REPORT

REPORT
TRANSMISSION STORES
TRANSMISSION
OPERATION STORE-KT
HQ-III HYDERABAD
HQ-II NAWABASHAH
HQ-I, SUKKUR
IRBPC-HQ-DADU
IRBPC-HQ SHIKARPUR
QPL(O&M)-SIBI
QPL(O&M)-QUETTA
CD-KHADEJI
GRIEP PROJECT KHADEJI
PIRKOH-SUI
ST. KHADEJI
DISTRICT KHI KHADEJI
DISTRICT KHI
TERMINAL
METER PLANT STORES
METER
PLANT
METER PLANT
ST. METER
PLANT

REPORT
STORE DEALINGS
Store accounting is based on meaning average basis. Each item has been allotted
index number according to the description and specification of material. Store index is
based on seven digits having fields of 00/00/000. 1 st 2 digits denote main section to
whom material is to be sent e.g. HO, Trans, MMP, etc. 2 nd 2 digits denote sub section
e.g. Finance in HO etc. 3rd 3 digits denote serial no of item like as Printing Paper, Pen,
Pipes etc. Stores system is based on the following store documents:
1. Material Receiving Statement
Foreign Receiving Statement
Local Receiving Statement
2. Material Requisition
3. Inter Store Stock Transfer
4. Material Return Voucher
5. Adjustment Memo
Store accounting is based on above store documents for generation of cost of material
received of issued.
PURPOSE OF STORE DOCUMENT

1. Material Receiving Statement:
When the material is received in the store department by the supplier or the
company the store department sends two receipts 1 st for supplier or respected
department and 2nd for store section for maintaining the record and controls it.
That receipt is known as Material Receiving Statement. If the material is supplied
from abroad in that case the Foreign Receiving Statement is issued and in the case
of local supplier the Local Receiving Statement is issued. When the receipt is
received by the store section from the store department the store section check R/S
number, date of issue, delivery challan / invoice no: Supplier name and address,
index number, description, units, and quantity (ordered, received, and balance)
through ERP that the received material is present at store department or not. After
confirmation, the receipt is put into records.
REPORT
2. Material Requisition:
When the store department issue the material to the user department according to
user demand the receipt is send to the store section for informing that we issue
that material to that user department in case of availability and approval of high
level management. That receipt known as Material Requisition. After receiving
that receipt the store department check the indenting department and particular of
job, store location code where from the material is issued, requisition serial NO:,
date of issued material, company code, function, account, organization unit and
project code, order number, quantity required, store index number, and quantity
issued through ERP that the requisite material is issued from store department or
not. After confirmation the receipt is put into records.
3. Inter Store Stock Transfer:

Sometimes material is required for one store due to out of stock and that material
is in access for another store department then needed department sent the requisite
for material and then material will transfer from accessible point to out of stock
point and receipt is to be sent to the store section for maintaining and controlling
the account with the name of Inter Stores Stock Transfer. The store section check
that from which store department to which store department material is transferred
along with the respected location code. And store section also check the issuing
store code NO:, serial NO:, date of transferring, description of material
transferred, store index number, unit code and quantity transferred through ERP
that the transferred material is in actual transferred from one store department to
another store department. After confirmation the receipt is put into records.
4. Material Return Voucher:

When the material is issued against the requisition sometimes material is not in
use or unserviceable and the user department return that unserviceable material to
the store department. When it is received by the store department they send the
voucher to the store section with the name of Material Return Voucher for the
purpose of maintaining. When it is received by the store section they check that
from which location material is return, department name, date of return,
organization code, serial number, description, job number, M.R NO. & date
REPORT

against which drawn, index NO., and quantity returned through ERP that the
returned material is correctly record or not by the store department. After
confirmation the receipt is put into records.
5. Adjustment Memo:
Sometimes during the entry we are doing mistake like wrong entry of index
number, invoice number, quantity, amount, job number, or others fro correct these
mistake companies make a journal voucher (JV) and correct the mistake. After
correcting the mistake the store department sends a receipt to the store section
with the name of Stores Adjustment Memo for updating changes. When the
receipt is received by the store section they check date of changing, store index
no: job number, quantity and remarks for what purpose that adjustment memo
made.

REPORT
LOCAL ORDER
The local order section is one of the most important sections of finance department.
The local order section entirely responsible for the payment of bills to various
suppliers and vendors. This section is only responsible for make payment to the
material suppliers. This section prepares the voucher for only tangible goods not for
intangible goods (services).
The main object of LO is to make ensure, secure and smooth payment to the supplier
timely and to gain the confidence of suppliers. The bill payments made under LO are
classified into:
Revenue Job denoted by 11/TKT
Stores Stocks Items denoted by 12/TKT
Capital Job denoted by 13/TKT
This section deals with material management department, R&D (store) and the
suppliers. LO section uses the Oracle application software to print a voucher after
punching data into system. The advantage of this software is that, if the wrong data is
punched in to the system, the voucher will not be printed.
LO section does not go though the payment process if any of the required documents
are missing just like, purchase order, receiving statement and the invoices.
In LO, payment system under go though some steps and procedures.
Functions of Local Order:

The core function of the department is to arrange payments against purchase orders
issued by the procurement department of Unit A & C in respect of the following
purchases.
In this regard LO verifies invoices quantities and rates against Receiving Slip and
Purchase Order (PO) and ensure that the authorized person has approved these.
It is also the responsibility of LO to ensure that goods and services are recorded
correctly i.e. capitalized or charge to revenue account.
It is the practice of LO to reconcile their Bankbook Record with LO-Day Book and
with their register on monthly basis in addition to daily reconciliation.

REPORT
LOCAL ORDER PROCESSING
INTENDS
TENDER ENQUIRY
QUOTATION
PURCHASE ORDER
INVOICE
RECEIVING STATEMENT
APPROVAL
CHEQUE CREATION
PROGRESS

REPORT
LOCAL ORDER PROCESSING

Intends:
Intents or the requisition is received from concern Departmental head by the
procurement department. If any department needs any (item), then the head of that
department submit the requisition to material management department in order to
purchase that thing. Now it is the responsibility of material management department
to purchase that item for concerned department.
Tender Enquiry:
Once the requisition is submitted and approved by the GM of material management
department, the tender process takes place. SSGCL issues the tenders for the
purchasing of material through advertisement in newspapers. All the potential and
interested suppliers come forward and submit their quotations and bids. Quotations
are taken by three lowest bidders.
Purchase Order:
After the bid selection and approval from top authorities, the evaluation report and
purchase order is prepared with five copies, and the copy of purchase order is sent to
these following departments.
Procure Department.
Finance Department
Supplier (Original)
R&D Department
Intender copy
Evaluation report is prepared by analyzing the budget available for concerned

department. If the budget for concern department is available, the purchase order is
sent to supplier.
After the success of evaluation report, the order is placed through purchase order.
Purchase order comprises the quantity of material needed, the price of material, date
on which the order was placed and the date of delivery. Purchase order also comprises
the name of supplier and purchase order number.
Invoice:
Invoice is a bill, which is prepared by supplier and sent to the customer for payment.
Receiving Statement:
When the materials are received and checked, receiving statement is prepared at R&D
department (store) and sent to bill section. Receiving statement comprises amount of
quantity, order number and the date on which material was received.
REPORT

Approval & Cheque Creation:
Purchase order, receiving statement and the invoices of the supplier are attached
together and the process for the payment starts by preparing voucher. Receiving
statement, purchase order and invoice items and amount are match and then data is
punched in oracle based application system under the invoice batches head. After
the punching of data voucher is printed and attached with purchase order, receiving
statement, invoices, delivery challan, sales tax invoice and the evolution report. A
checklist is also prepared to make sure that all the formalities are compiled with, and
then the payment vouchers are checked and approved by the DCM, DGM, and GM if
required.
After the approval of payment voucher, this set of document is sent to cash and bank
section for preparing cheque in favor of supplier.
Other Activities in Local Order:

LO section deducts few charges from the amount payable to suppliers. They are:
General Sales Tax @ 17%

GST 17% is added into the payable amount.
Withholding tax @ 3.5% or 4%

This is the income tax, which is deducted from payable amount, and then tax is
given to tax department of Pakistan.
3.5% if it is Tax Registered Company
4% if Company is not Tax registered
GST withholding tax @ 20% or 10% on GST

amount
20 % withholding tax is deducted from GST amount if a company is

Manufacturer
10% if a company is Wholesaler
and then SSGC gives that amount to sales tax department.
Late Delivery (LD) @ 0.1% per day

LD is deducted from payable amount if the delivery is late.
0.01% is deducted for one day. LO can deduct only up to 10% of payable
amount even late delivery exceed the 100 days.
Bank Guarantee:
It is the practice of SSGC to obtain bank guarantee from the supplier where tender
price exceeds Rs. 500,000 with respect to purchase order.
REPORT
Financial Powers:
Previously payments up to Rs. 100,000, 200,000, and Rs. 500,000 required to be
approved by DCM, DGM and GM respectively. However, Deputy Managing (DMD)
has approved revised financial powers.
MIS Reporting:
DCM submits report on monthly basis regarding details of bills received and
processed during the month and detail of outstanding bills to DGM for further
submission to GM and DMD.
Generalization of Receiving Slip on Monthly Basis:

At the end of each month, LO generalized receiving slip received and processed
during the month by passing the following entry:
Stores /Revenue / Capital Account
Dr.
Sales Tax-Adjustable
Dr.
Sundry Creditor
Sundry Creditors
Cr.
Dr.
Liquidated damages
Cr.
Income Tax Deducted at Source-Payable
Cr.

REPORT
Insurance Section
In the present world, where life is full of anxiety, dangers and risks, insurance is
essential to protect and compensate for sudden loss of life and property. It has also
been made compulsory by law in most of the countries to protect assets/property of
Government concerns and corporate bodies.
Basically insurance cover is confirmed when premium is fully paid and POLICY is
issued by the insurers, but in case of very huge volume of business like that of Sui
Gas Southern Gas Company Limited, a HOLD COVER letter from the insured is
enough for confirmation of insurance cover.
Responsibilities of Insurance Section:

Following are the responsibilities of insurance section:
1. Insurance coverage of All the Assets and Employees of SSGCL under:
a. Fire Insurance
b. Motor Vehicles
c. Employees Benefit
i. Group Insurance
ii. Personal Accident
d. Marine Insurance
e. EAR Insurance
f. Casual / contract labor Insurance
2. Lodging and settling of Insurance claims under above mentioned policies.
3. Renewal of Fire Insurance and other policies on Annual Basis.
4. Preparing Budget of Insurance on Annual Basis of following:
a. Fire Insurance
b. Motor Vehicle Insurance
c. Employees Benefit
5. Payment of Debit Notes to NICL and Adamjee Insurance throughout the year.
6. Passing Recurring JV of Fire Insurance and Motor Vehicle on Monthly basis.
7. Correspondence with NICL.
8. Correspondence with Surveyors.
9. Correspondence with other departments.
10. Preparing Reports for Management.

REPORT
Kinds of Insurance Policies Maintained By

SSGC:
There are seven kinds of insurance policies which are maintained by SSGC are given
below:
1. Fire policies.
2. Accident policies.
3. Marine policy.
4. Motor Vehicles policies (M.V).
5. Employees benefit policies.
a) Group life insurance.
b) Personal accident policy.
6. Erection all risk policy (EAR).
7. Voluntary insurance.
1.Fire Policies:
It provides full comprehensive coverage in respect of Loss or damage to property
due to fire and lightening , which can be extended to cover explosion, earthquake
(fire and shock), atmospheric disturbance (rain, flood, hurricane), heat or
combustion, riot and strike damage etc.
NICL provides this coverage in conjunction with the fire. It provides protection
against loss of gross profit incurred as a result of business interruption or interference
in business caused by an event indemnifiable under fire and allied perils policy.
Presently SSGC Fire Insurance Policy is taken from NICL Insurance Company.
Following are the list of Fire Insurance Policies:
A.
B.
C.
D.
E.
F.
G.
H.
I.
Gas Pipeline: Transmission and Distribution.

Compressors.
Stores.
Badin Gas: Liquid Handling Facility.
SCADA.
Gas Odorants.
Consequential Loss of Profit.
Compressors Terrorism.
LHF Terrorim
J.
K.
L.
M.
N.
O.
P.
Buildings: other than Head Office

Contents in Company's Premises including Head Office and other location
Construction Equipment at Khadeji
Buildings: Head Office
Telecommunication, Plant & Machinery at K.T.
Computers Including Lap Top.
Hand Held Computers

REPORT

Q. Plant (Meter Plant) Including Building.
R. Stores at Meter Plan.
2.Accident Policies:
All the Accident policies are taken from NICL which are mentioned below:
a) Cash & Safe

Money insurance provides cover against loss of cash-in-safe and cash in transit caused
by robbery, theft, or any fortuitous event; loss of money from the insureds premises
during business hours caused by theft or robbery; and loss of money from the
insureds safe or strong room caused by theft or robbery.
b) Director Pat Policy

Traveling inside the country or worldwide is an essential part of most of the
executives working lives. Certainly, along with it comes the risk for any personal and
financial loss that they might face on a business trip. This policy covers the employer
and employees for any accident, sickness, and medical attention in an emergency that
may occur whilst traveling.
c) Fidelity Guarantee
This policy covers the risk of employees embezzlement and misappropriation of cash
and other assets of the company.
d) Workmen's Compensation
This is mandatory by law. As per law SSGC is bound to provide insurance cover to its
contract employees.
e) Public Liability
This policy is obtained to reimburse loss sustained to assets of third party under
possession of SSGCL.
3. Marine Policy:
Marine insurance policy covers the risk of imports and exports as per requirement of
the organization. This policy can be extended to provide adequate cover to protect all
goods in transit by other modes of transportation, viz., by Air, Rail & Road. Through
insurance company the goods are protected from the time the goods leave the sellers
warehouse until they reach the buyers warehouse.
The party usually responsible for insuring the goods is determined by the sales
contract. To help the insured familiarize with the buyers and sellers responsibilities.
Presently SSGC Fire Insurance Policy is taken from NICL Insurance Company.
Policy Purchasing For Marine Insurance:

REPORT

Proposal for insurance (request for insurance) is made by the procurement department
direct to NIC. NIC issues certificates for each consignment proposed for insurance
and sends to insurance section along with a statement on monthly basis. This
statement is sent to procurement department for verification/confirmation. On receipt
of this confirmation, premium is paid by insurance section through a Cheque.
4. Motor Vehicles Policies (M.V):

Motor vehicle insurance policies provide coverage against accidental damage
including fire, theft, snatching away by violent means, riot and strike damage, loss or
damage due to natural calamities, road traffic act, and at common law, third party
liability (Bodily, Injury and property damage).
The policy can also be extended to include accidental personal injuries to and death of
driver and passengers.
Presently SSGC Motor Vehicle Policy is taken from NICL Insurance Company.
Following are the list of Motor Vehicle Insurance Policies:
A.
B.
C.
D.
E.
Commercial Vehicles.
Commercial Vehicles with Tracker.
Private Vehicles.
Private Vehicles with Tracker.
Motor Cycles.
5. Employees Benefit Policies:

There are two types of policies are maintained under this group by SSGC:
a) Group life insurance

In Group Life Insurance, the organization can decide the benefits it wants for each
employee. Sum Insured Can be a flat amount or a multiple of the salary. Premiums for
Group Life Insurance are paid by the organization.
Presently SSGC Group Life Policy is taken from American Life Insurance Company.
Group insurance covers the natural death of SSGC employees. Family of deceased
employee will be entitled for following claim.
Sum Insured of Executives is One Annual Gross salary.

Sum Insured of Non Executive is Rs. 20,000 for each employee.
b) Personal accident policy

In an increasingly competitive business scenario, every organization has to prepare for
the unexpected. This implies not just to its property, but also the employees. An
employer is responsible for the health and safety of all the employees while they are
working in the organization. This insurance indemnifies the insured in case if at any
REPORT

time during the period of the insurance any employee during his service shall sustain
personal injury by any accident.
Presently SSGC Personal Accident Policy is taken from Century Insurance Company.
Personal Accident insurance covers the accidental death of SSGC employees. Family
of deceased employee will be entitled for following claim.
6. Erection All Risks Policy (EAR):

EAR provides coverage against all risks during:
The erection of machinery, plant and all kinds of steel structures

Testing /trial run of new machinery
Third party legal liability for loss of or damage to property and bodily injuries
Expansion of an existing project.
Dismantling and re-erection of an existing facility.
The interests of suppliers, manufacturers, contractors as well as subcontractors can be

included in the policy. Cover the project site and terminates on completion of testing
or handing over of the project to the principal or the period chosen, whichever is
earlier.
Presently SSGC Erection All Risk Policies are taken from NICL Insurance Company.
Policy Purchasing For EAR Insurance:

This policy is taken for projects. Specified proposal form is completed by P&C or
P&D and sent to insurance section for getting insurance cover. After processing the
required formalities, EAR policy is issued by NIC. This is one time cover till
completion of Project and premium is charged for the entire period.
7.Voluntary Insurance:
Voluntary Insurance has following features:
The plan is specifically designed for the organization.

No direct cost to the organization as employer
Each employee decides the level of cover they want.
Involves minimal administration and paperwork.
Premiums are directly deducted from employees salary.
Presently SSGC Voluntary Insurance Policy is taken from New Hampshire Insurance
Company.
Process for the Claim of Insurance Policies:

REPORT

When there is a damage or loss, the process of insurance starts. The first step is taken
by the location incharge who informs Finance either or through concerned G.M.
Further steps to be taken are narrated below:
1) On receiving report of damage or loss, Insurance Section will enter the loss in
Insurance Register and allot a file no. this file no will be the reference no. of that
claim for further process.
2) Immediately, a formal notice of claim will be served upon the Insurers.
3) On receiving formal notice of claim, the Insurer allots their claim no. (Reference
no.) That will be their reference in future and till finalization. A surveyor is also
appointed at the same time by the Insurer.
4) Insurance Section makes liaison with the appointed surveyors and arrangements
are made to take him to the place of survey in consultation and co-ordination with
the concerned department.
5) After completion of survey, the surveyor asks Finance Dept. To provide
documents.
6) Usual documents required are:
Claim Form: This form is completed and signed by department concerned and
forwarded to finance for onward submission to the surveyors and insurers.
Copy of FIR where required.
Statement of loss.
Departmental Enquiry Report.
Details of repair works.
Documents in support of expenses incurred such as cash memo, receipts etc.
Any other document as required by surveyors/insurers.
7) Documents are prepared and arranged by concerned department and are provided
to finance for onward submission to surveyors/insurers.
8) Documents are prepared in duplicate sets one each for the Surveyors and the
insurers.
9) Insurance section always keeps strong and constant liaison with concerned
department for arranging /preparing claim documents.
On completion of claim document with the insurers, Insurance keeps pursuing
insurers for settlement.
Documents Required In Case Of Group And Personal

Accident Claims:
1. Claim form: Completed and signed by I.R. or H.R Department.
2. Physicians statement.
REPORT

3.
4.
5.
6.
Proof of age.
Death certificate.
Burial certificate.
Photocopy of NIC of the deceased.
In Case Of Accidental Death:

In addition to the above mentioned documents, the following documents are also
required for accidental death claims:
1. Copy of FIR
2. Copy of post mortem report.
First information of incident ( either death or accidental injury ) may be given by the
concerned location where the employee was working or may given by Medical
Department or by IR/HR department .Further process is completed by Insurance
Section in collaboration with IR department in case of unionized staff and with HR
Department in case of executive staff.
Claim Process for Marine Claims:

Information for any shortage, damage or missing in the consignment is reported to
Insurance section by procurement department. Based on this information, notice of
claim is served with the insurers by insurance section. A surveyor is appointed by the
insurers who give his report upon which claim is paid by the insurance company.
Damages up to 2% of C&F value is not claimed under voluntary excess.
Documents Required For Marine Claims:

Usually, following documents are required for settlement of marine claims:
1.
2.
3.
4.
Bill Of Lading.
Bill Of Entry.
Purchase Invoice.
Original Insurance Certificate
First three documents are provided to insurance section by procurement department

and insurance certificate is available with the section.
Claim Process for EAR:

Claim process for EAR losses/damages is the same like FIRE CLAIMS but voluntary
excess is not applies rather Compulsory deduction is applied the amount of which
differs from policy to policy.
Renewal Of Insurance Policies:

SSGCS all the insurance policies expire on 30th June and the renewal of the policies
is done on 1ST July. As every year there is some change (increase or decrease) in the
value of assets but the exact figure of this change can only be determined after
REPORT

finalization of financial statements. So in order to get insurance coverage of all the
assets, SSGC obtains endorsement by paying 50 percent of the proposed budgeted
premium to NICL and the remaining amount is paid after finalization of financial
statements.
Accounting of Insurance Section

Journal Entries:
1 Accounting for Prepaid Insurance
I
At the time of booking of prepaid premium:

Prepaid Insurance
Payable to Insurance Company (Through NLO)
II
Cr.
At the time of payment of premium to Insurance company:

Payable to Insurance Company (Through NLO)
Cash / Bank
II
Dr.
Dr.
Cr.
At the time of charging of prepaid Insurance expense:

Insurance Expense
Prepaid Insurance
Dr.
Cr.
2 Accounting for Insurance Claims

Case I : Accident / damage of Asset
I
In case of Accident / damage to Vehicle. Booking of Loss:

Recoverable From Insurance Company
Payable to Contractor / Workshop
II
Cr.
In case of Accident / damage to Vehicle. Payment to

Workshop:
Payable to Contractor / Workshop
Cash / Bank
II
I
Dr.
Dr.
Cr.
At the time of Settlement of claim from Insurance company:

Cash / Bank
Dr.
Case II : Total loss of Asset

I
In case of total loss of asset. Booking of Loss:

REPORT
Cr.

Asset
II
Dr.
Cr.
At the time of Settlement of claim from Insurance company:

Cash / Bank
Dr.
Cr.
3 Accounting for Death Claims

I
At the time of receiving Cheque from Insurance Company:

Cash / Bank
Dr.
II
At the time of booking payment:

Recoverable from Insurance Company
Payable to family of deceased.
II
I
Cr.
Dr.
Cr.
At the time of payment of claim to the family of deceased:

Payable to family of deceased.
Cash / Bank
Dr.

REPORT
Cr.

REPORT
FLOW CHART FOR THE CLAIM OF

INSURANCE POLICIES
Concerned Department
Send Notice of Loss to
Insurance Section
Insurance Section Inform

NICL With in 15 Days From
The Date Of The Loss
Surveyor Performs the Survey
of the Location And Send
Insurance Section List Of
Required Documents
NICL Appoint Surveyor

And Issue Claim
Number
Insurance Section Collects
Documents From The
Concerned Department And
Submits It To The Surveyor
Surveyor Submits
The Survey Report
To NICL
Based On That Report

NICL Settle The
Claim
NICL Deducts Rs. 20 Million

Voluntary Excess on Each
And Every Claim

REPORT
FLOW CHART FOR THE RENEWAL

OF INSURANCE
POLICIES:
All The Policies Expired On
30TH June
Renewal Is Done On
1ST July
50% Premium From

The Proposed Budget
Is Paid To NICL
All The Assets Are Endorsed

From NICL
All The Remaining

Payments
Are Paid According
To The Schedules

REPORT
RECOMMENDATION &
SUGGESTIONS
REPORT
SSGC is playing a leading role in the energy sector of Pakistan and is on its track of
meeting its strategic goals and objectives. Over the past 50 years, the company has
made momentous progress and has brought the fruits of clean, low cost and
environment friendly natural gas within the reach of over 1.9 million domestic,
commercial and industrial customers all over Sindh and Baluchistan. As a result, the
company has emerged as a leading fully integrated utility company that continues to
play a major role in fuelling national progress.
Following are the recommendations:
1.Management Issues:
During my internship, I observed that the contract employees are demotivated because
of unfairly treated & because of their dissatisfaction with pay and working conditions.
The salaries of the contract employees are very low as compare to amount of work
performed by them. Contract employees should given a chance to work on career
basis.
Lack of Training:
There is lack of training in some departments which create problem for employees to
work on the ERP system.
Recommendation:
It is recommended that training should be given to each employee periodically.
Sufficient training of the human resource is very important, so they would become
acquainted and proficient with the ERP system that is implemented.
SSGC needs to address various kinds of issues like some employees are under-valued,
some are under-trained, and some may be under utilized. Similarly some may be
demotivated and consequently perform well below their true capability.

REPORT

SSGC Internship Report on Finance Department

Caricato da

Informazioni sul documento

Titolo originale

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

SSGC Internship Report on Finance Department

Caricato da

Copyright:

Formati disponibili

Sui Southern Gas Company Limited

MUHAMMAD OSAMA SALEEM

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 1

Sui Southern Gas Company Limited

These Efforts are dedicated to

Whose kind co-operation, Blessing, Help and

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 2

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 3

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 4

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 5

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 6

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 7

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 8

Sui Southern Gas Company Limited

Sui Southern Gas Company Limited

Sui Southern Gas Company Limited

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 12

Sui Southern Gas Company Limited

Corporate Social Responsibility:

Leading & Becoming Effective Team Player:

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 13

Sui Southern Gas Company Limited

Respect each team member

Be patient and listen to all and play your part

Be flexible and show sensitivity for others feelings.

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 14

Sui Southern Gas Company Limited

Cash & Bank

Cost & Revenue

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 15

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 16

Sui Southern Gas Company Limited

MAJOR ACCOUNTING POLICIES

Straight line Depreciation Policy is being applied over the Assets

Stock of Gas in transmission pipelines is valued at lower of cost determined under

Stores, Spares and Loose Tools:

Trade and Other Payables:

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 17

Sui Southern Gas Company Limited

However the company is required to earn a minimum annual return before

Long Term Deposit:

Government of Pakistan. These deposits are repayable and adjustable on the

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 19

Sui Southern Gas Company Limited

FIXED ASSET ADITION PROCESS

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 20

Sui Southern Gas Company Limited

FLOW CHART OF FIXED ASSET ADITION

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 21

Sui Southern Gas Company Limited

SUI SOUTHERN GAS COMPANY| M.OSAMA SALEEM | INTERNSHIP 22

Sui Southern Gas Company Limited

Fixed Asset Retirement process

Fixed Assets Retirement Process