Audit report

During the stock count e observe the following weaknesses and ascertain the risks associated with them and developed following suggestions to develop controls to address these weaknesses. The details of these are as follows: 1 . Excessive Accessories stocks found as compared to system report. Observations:- During the audit we observe that some of stock physically available is in excess as compared to the stock as per stock report. For details of these please, see annex “A”. Later on discussion with store uncharged Mr..

Adele it came to know that, this problem occurred due to stock shifting, adjusting stock report, bulk quantity counting of stock really with routine activities etc. Some Grins and store issues are also not properly posted in time, that is why this issue raise. Recommendations:- The posting issue should not have any excuse; store team should manage their time to post all types of documents in system to update the stock report. It is also recommended that store team should adopt the policy of efficiency instead of effectiveness. 2.

Less quantity of stocks found physically as compared to Accessories stock report. Observations:- We observed that some stocks in actual are less as compare to reported quantity. For details of these, please see annex “B”. Recommendations:- It is recommended to post issuance in system carefully and posting of issuance should be checked on daily basis. We recommended that the issuance book should be systematized and in new software this document will move as prepared by, approved by and deliver by and finally system post this issue automatically. 3. Stock not found physically but mentioned in stock report.

Observations:- During the audit we observed some quantity of stock not physically in store as compared with stock report. For details of these please see annex “C” Later on discussion with store uncharged it came to know that due to the shifting of store items o new place and some issuance are also not posted/misplaced, that’s why these items showing in report. It is recommended that all issuance should be posted timely in software on daily basis, the items which are not physically exist should be located in report and adjust the report as per the actual conditions to maintain the proper stock report.

To resolve this problem the store team should get the approval of management, and after approval they have to adjust the stock accordingly. 4. Items not in report but physically exist During the course of audit it was found that some of the items are physically exist in he store but there is no record of these in the accessory report. For details of these please, see annex “D”. Recommendations:- It is recommended that store issue returns must be recognized when received at store.

Proper record and physical stock must be kept by the store team. 5. Old Stock found in store During the course of audit it was found that lot of space was covered by old stock this stock is not in use since more than 2 year as per information given by the store team these items include: Inlay card Poly bag Buttons For details of these please, see annex “E”. It is recommended that time period should be defined after which certain item will be considered a part of dead stock.

By doing this, dead stock will be separated from old stock. After this, dead stock should be sold at reasonable price and old stock should be properly placed at certain area with label of old stock and should not be mixed with fresh stock. When this old stock will not be used for a certain defined time period, it should be classified as dead stock and be sold as well. 6. Placement and Item codes It is observed that some items such as LABEL and THREAD are placed in different parts in a few boxes. . Thread of one shade found in different boxes and in different places and some of poly bags have no item codes. For details of these please, see annex “F”. Recommendations:- It is recommended that every item in store must be placed at single place so that these can be easily accessible. Secondly item codes must be mentioned on the items properly. 7. Practice of Safety Stock not adopted It was found during our audit that concept of safety stock was not being considered by the store management.

The different routine items like stationary, kitchen items, some stitching general items like needles, commonly use thread and stitching aching spare parts etc. Don’t have any safety stock formula, and this problem can stuck the flow of work. It is recommended that store team should be provided with all information about crucial items of different departments which may cause disturbance in the flow of work. Store should have a safety stock of all such items so that these could be used in case of emergency shortage.

By doing this smooth running of flow work can be ensured. They should also consult with management in this regards. 8. Tagging and dust issues It is observed that some of the items are not properly tagged and there is dust on the teems also. This type of issues create risk like decrease in the value of stock it may also create delay problem for production if the things are not properly tagged and placed. Recommendations:- It is suggested that all the items with proper identification should be at specific place and should cover properly.

Proper posting in software will be helpful to maintain the record. 10. Goods directly issued to department without any knowledge of store During the course of our audit it is observed that, some required items are issued directly to the department from where the items are demanded and all the paper work (documents) starts after this, and the store team prepares GRIN after receiving he store issue requisition and ZIP from the department.

Recommendations:- It is recommended that if there is any item require urgently in any department and they purchase this on emergency basis, then this item should come first in store and issued from store as well ,and then store uncharged will prepare the GRIN after receiving the documents. By doing this there will be no ambiguity in record and all the items will come into the knowledge of store uncharged. 11. No record for items under RSI. 500. Observation:- It is observed that the items purchased which having value less than 500 rupees have no record in the store.