PURCHASE OF

INVENTORY
ITEMS
 LEARNING OBJECTIVES
Define Inventories
Enumerate some inventory items
State when and how the expense
item is taken up in the books
Name the basic requirements for
the payment of inventory items
Identify the documents to support
the expense
Name and describe the modes of
procurement
Name and describe the other
activities undertaken after
procurement
 DEFINITION
Inventories are assets:
➢In the form of materials or supplies for
production process;
➢In the form of materials or supplies to be
consumed or distributed in the rendering of
services;
➢Held for sale or distribution in the ordinary
course of operations; or
➢In the process of production for sale or
distribution.
12-6
 CLASSIFICATION OF
INVENTORIES

• Inventory Held for Sale

• Inventory Held for Distribution

• Inventory Held for Manufacturing

• Inventory Held for Consumption

 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS
Account Code Account Title
Inventory Held for Sale
1 04 01 010 Merchandise Inventory
Inventory Held for Distribution
1 04 02 010 Food Supplies for Distribution

1 04 02 020 Welfare Goods for Distribution

1 04 02 030 Drugs and Medicines for Distribution

Medical, Dental and Laboratory

1 04 02 040 Supplies for Distribution

 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS
Account Code Account Title

1 04 02 050 Agricultural and Marine Supplies for

Distribution
1 04 02 060 Agricultural Produce for Distribution

1 04 02 070 Textbooks and Instructional Materials for

Distribution
1 04 02 080 Construction Materials for Distribution

1 04 02 090 Property and Equipment for Distribution

1 04 02 990 Other Supplies and Materials for

Distribution
 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS
Account Code Account Title

Inventory Held for Manufacturing

1 04 03 010 Raw Materials Inventory

1 04 03 020 Work-in-Process Inventory

Finished Goods Inventory
1 04 03 030
 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS
Account Code Account Title

Inventory Held for Consumption

1 04 04 010 Office Supplies Inventory

1 04 04 020 Accountable Forms, Plates and

Stickers Inventory
1 04 04 030 Non-Accountable Forms Inventory
1 04 04 040 Animal/Zoological Supplies Inventory
1 04 04 050 Food Supplies Inventory

1 04 04 060 Drugs and Medicines Inventory

 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS

Account Code Account Title

1 04 04 070 Medical, Dental and Laboratory

Supplies Inventory
1 04 04 080 Fuel, Oil and Lubricants Inventory
1 04 04 090 Agricultural and Marine Supplies
Inventory
1 04 04 100 Textbooks and Instructional
Materials Inventory
 INVENTORY ACCOUNTS
PER REVISED CHART OF
ACCOUNTS

Account Code Account Title

1 04 04 110 Military, Police and Traffic

Supplies Inventory
1 04 04 120 Chemical and Filtering Supplies
Inventory
1 04 04 130 Construction Materials Inventory
1 04 04 990 Other Supplies and Materials
Inventory

12-20
MEASUREMENT OF INVENTORIES

➢lower of cost and net realizable value

➢FV at the date of acquisition

➢lower of cost and current replacement

cost

12-8
Net Realizable Value is the estimated selling
price in the ordinary course of operations,
less the estimated costs of completion and
the estimated costs necessary to make the
sale, exchange, or distribution.

Current replacement cost is the cost the

entity would incur to acquire the asset
on the reporting date.
 MEASUREMENT OF INVENTORIES
COST OF INVENTORIES

a. Costs of Purchase
➢ Purchase price
➢ Import duties and other taxes
➢ Transport, handling and other attributable cost

b. Costs of Conversion
➢ Costs directly related to the units of production
➢ Allocation of fixed and variable production
overheads

c. Other Costs
 Example of costs excluded from the cost of
inventories
a. Abnormal amounts of wasted materials,
labor, or other production costs
b. Storage cost, unless those cost are necessary
in the production process before a further
production stage
c. Administrative overheads that do not
contribute to bringing inventories to their
present location and condition
d. Selling cost
MEASUREMENT OF INVENTORIES
COST FORMULAS

Moving Average Method. The moving

average method of costing shall be used
for costing inventories. This is a method of
calculating cost of inventory on the basis
of weighted average on the date of issue.
The Accounting Unit shall be responsible
in computing the cost of inventory on a
regular basis.
 MEASUREMENT OF INVENTORIES
IMPAIRMENT

➢If the net realizable value is lower than

cost, the inventories are usually written
down on an item by item basis.

➢In some circumstances, however it

may be appropriate to group similar or
related items.
MEASUREMENT OF INVENTORIES

➢Fair Value (FV) at the date

of acquisition

• if acquired through a non-

exchange transaction

12-8
MEASUREMENT OF INVENTORIES

➢lower of cost and current replacement

cost if held for:

(a) distribution at no charge or for a nominal

charge;

(a) consumption in the production process of

goods to be distributed at no charge or
for a nominal charge.
12-8
Recognition of Inventory as
Expense

➢ When sold, exchanged, or

distributed;

➢ Writedown of inventories;
and

➢ All losses of inventories

12-11
 COA CIRCULAR 2005-002 DATED
APRIL 14, 2005

• This circular prescribes the accounting

policy on items with serviceable life of
more than one year but small enough
to be considered as PPE – to be
recorded as INVENTORIES upon
acquisition and as Expense upon
issuance.
 COA CIRCULAR 2005-002 DATED
APRIL 14, 2005

• For monitoring and accountability,

an INVENTORY CUSTODIAN SLIP
(ICS) shall be prepared upon
issuance of small tangible items
covered by the approved RIS.
 TANGIBLE ASSETS THAT MAY BE
CONSIDERED AS INVENTORIES:

• Office Supplies (blackboard, cutter, desk tray,

sharpener, pencil, stapler, pen, puncher, etc = 2-5
years)
• Animal/zoological supplies ( cage, feeders,
padlock, pails, water jug = 2-3 years)
• Medical, Dental & Lab Supplies (baking pan, basin,
bed sheets, chart holder, etc = 1-5 years)
• Common janitorial supplies (dust pan, mop handle,
etc = 2-5 years)
 TANGIBLE ASSETS THAT MAY BE
CONSIDERED AS INVENTORIES:

• School Chairs, Desks and Tables (wood)-

5 years
• Textbook and Instructional Materials (2-5
years)
• Military & Police Supplies (3-5 years)
• Hardware and Construction Supplies (1-
5 years)
• Electrical supplies (2 years)
 ACCOUNTING FOR PURCHASES OF
INVENTORIES
-

Perpetual Inventory Method

- purchases of supplies and materials for stock,

whether consumed or not during the accounting
period, are recorded as ASSET (except PCF)

-under this method, the MOVING AVERAGE UNIT COST

is used which provides a new unit cost after each
purchase and/or when items are issued/used

- EXPENSE shall be taken up upon utilization/

consumption
 ACCOUNTING FOR PURCHASES OF
INVENTORIES
-

DETAILED inventory records (apart from the

usual ledger accounts) are maintained for
each inventory item showing RECEIPTS,
ISSUES and BALANCES on Hand both in units
and peso amounts.

Thus, physical quantity and the valuation of

goods on hand at any time are available from
the accounting records.
 PROCUREMENT

• refers to the acquisition of Goods,

Consulting Services and the
contracting for Infrastructure
Projects by the Procuring Entity
 GENERAL POLICIES ON
PROCUREMENT

• Compliance with laws, rules and

existing policies;
• Prohibition against Splitting;
• Need for a certificate of
availability of funds for the
purchase
 GENERAL GUIDELINES

1. Agencies shall procure common-use

supplies and materials from the
Procurement Service (PS) of the DBM,
in accordance with LOI No. 755, EO
Nos. 289 and 359, series of 1987 and
1989, respectively.
2. Procurement of supplies and materials
shall be through competitive public
bidding.
 GENERAL PROCEDURES IN
PROCUREMENT

1. Procurement Planning and the

Preparation of the Annual
Procurement Plan (APP);
2. Requisitioning and Preparation of
Supplies Availability Inquiry (SAI) *
3. Preparation and Approval of
Purchase Requisition (PR)
4. Implement appropriate Mode of
Procurement
 GENERAL PROCEDURES IN
PROCUREMENT

4. Preparation of Obligation Request

and Status (ORS)/Budget
Utilization Request (BUR)
5. Preparation and Approval of
Purchase Order
6. Delivery, inspection and
acceptance of the items
7. Payment of the items delivered
 GENERAL POLICIES ON
PROCUREMENT PLANNING

1. PROCUREMENT should be
within the approved budget
of the procuring entity and
should be meticulously and
judiciously planned .
 GENERAL POLICIES ON
PROCUREMENT PLANNING

• No procurement shall be
undertaken unless it is in
accordance with an approved APP

• The APP must be consistent with

its duly approved yearly budget.
 GENERAL POLICIES ON
PROCUREMENT PLANNING

• Consistent with government fiscal

discipline measures, only those
considered crucial to the efficient
discharge of governmental
functions shall be included in the
APP.
 GENERAL POLICIES ON
PROCUREMENT PLANNING

2. Each procuring entity shall

judiciously prepare, maintain
and update an APP for all its
procurement, that shall
include, for each individual
project, a Project Procurement
Management Plan (PPMP)
 GENERAL POLICIES ON
PROCUREMENT PLANNING

3. The PPMP shall include:

• type of contract to be employed
• extent/size of contract scopes/
packages
• procurement method to be adopted
• time schedule for each procurement
activity
• estimated budget or ABC
 GENERAL POLICIES ON
PROCUREMENT PLANNING
ABC for the contract shall be at all times
consistent with:
• NGAs – appropriations for the project
authorized in the GAA and/or
continuing appropriations;
• GOCCs – corporate budget approved
by the governing boards pursuant to
EO 518; and
• LGUs – the budget approved by the
Sanggunian
 GENERAL POLICIES ON
PROCUREMENT PLANNING
4. The preparation and updating of the
PPMPs shall be the responsibility of the
respective Project Management Offices
(PMOs) or end-user units of the procuring
entities
5. Consolidation of the PPMPs into an APP
shall be lodged with the BAC Secretariat of
the procuring entity that may avail of the
services of technical experts to review the
individual PPMPs.
 GENERAL POLICIES ON
PROCUREMENT PLANNING
• The APP shall include provision for
foreseeable emergencies based on
historical records. In the case of
textbooks for general use, the packaging
of the contract shall be divided into 2
components:

a) Development of the manuscript; and

b) Printing of the textbooks.

 GENERAL POLICIES ON
PROCUREMENT PLANNING

• Updating of individual PPMPs and the

consolidated APP shall be
undertaken every 6 months or as
often as may be required by the head
of the agency.

• Implementation of any Project not

included in the APP shall not be
allowed.
 REQUISITIONING

Requisitioning is requiring that

something be furnished. In
the procurement function, it is
the submission of written
requests for supplies,
materials and the like.
 SPECIFICATION

Specification is the heart of

any contract for the
supply of goods or
services since they
describe the supplies to
be delivered and the
services to be rendered.
 TYPES OF SPECIFICATIONS

• Performance specifications

• Design specifications

• Purchase descriptions
 TYPES OF SPECIFICATIONS
• Performance specifications –
contain the performance
characteristics desired for the
item

Ex: the item must weigh no more

than 20 lbs. The detailed design
or exact measurements are not
stated.
 TYPES OF SPECIFICATIONS

• Design specifications –
contain precise measurements,
tolerances, materials in
process and finished product
tests, quality control and
inspection requirements and
other detailed information.
 TYPES OF SPECIFICATIONS

• Purchase descriptions – which

should always allow for
competition.

• SEC. 18. Reference to Brand Names. -

Specifications for the Procurement of
Goods shall be based on relevant
characteristics and/or performance
requirements. Reference to brand
names shall not be allowed.
 PURCHASE REQUEST (PR)

• shall be used to request for the

purchase of inventory/item not
available on stock and it shall
be the basis of preparing the
Purchase Order.
 PURCHASE ORDER (PO)

– the document evidencing a transaction

for the purchase of supplies and
materials, usually prepared by the
Supply Officer or his equivalent.

- prepared after the decision on the mode

of procurement has been made and
the conditions pertaining thereto have
been met.
 REQUISITES OF PURCHASE ORDER
(PO)
COMMISSION ON AUDIT CIRCULAR NO. 97-004DATED JULY 1, 1997

The PO shall indicate the following:

• Purchase Order No. and Date;
• Office to which the account shall be
charged and the requisition number;
• Complete name and address of the
contractor/supplier including telephone
and fax number, if any;
• Office from which payment shall be
collected;
 REQUISITES OF PURCHASE ORDER
(PO)

• Complete description and detailed

specifications of the supplies and all
other information and data needed
to enable the supplier, agency
officials, agency property inspectors,
and others concerned to determine
the nature and quality of the items
purchased;
REQUISITES OF PURCHASE ORDER
(PO)

 Price (individual unit price, if lot price,

any document showing the detailed
breakdown of the cost should likewise
be submitted);
 Quantity and unit of measure;
 Period of delivery;
 Shipping terms and directions and
other conditions of delivery;
 REQUISITES OF PURCHASE ORDER
(PO)

• Provision on penalty and liability

of suppliers/contractors in cases
of late delivery or non-delivery
• shall be a minimum of 1/10 of one
percent (1%) for each day of delay;
computed on the basis of: (a) the
total value of the contract; or (b) if
the contract has been partially filed
within the stipulated time, the total
value of the undelivered purchase;
 REQUISITES OF PURCHASE ORDER
(PO)

• Conditions regarding importation,

if any;
• Date of effectivity and termination
of the contract;
• Terms of payment to include
discounts for prompt payment
whenever applicable; and
REQUISITES OF PURCHASE ORDER
(PO)

• Taxes paid by agency; i.e. VAT,

etc. (taxes paid by the suppliers
need not be indicated);
• Mode of Procurement; and

• Availability of budget/
appropriations/funds.
 REQUIREMENTS FOR
REQUISITION
Agencies may enter into a contract of one year
purchases of supplies and materials subject
to the following:
• Deliveries should be on a staggered basis;
• Two month’s supply requirements are not
exceeded to prevent overstocking; and
• Payment shall be made after each delivery
only.
APPROVAL OF PURCHASE ORDER

Contracts Full authority to heads of

awarded thru procuring entities to enter
public bidding into contracts and/or give
final approval

Heads of procuring entities

may delegate in writing this
full authority.
 APPROVAL OF PURCHASE ORDER

Contracts For contracts below P300

entered into million, full authority to Head
thru of procuring entity.
alternative
modes He/she may delegate in writing
this full authority.
 APPROVAL OF PURCHASE ORDER

Contracts For contracts involving P300

entered into million, head of entity shall have
thru full authority after obtaining:
alternative ◼ Opinion of the Justice Secretary
modes that contract falls within the
exceptions to public bidding;
◼ Approval from NEDA Director
General or any authorized
approving official.
 DELIVERY OF PO

The PO is delivered by the

agency personnel concerned to
the contractor/supplier within a
reasonable period of time
 DELIVERY, INSPECTION AND
ACCEPTANCE OF ITEMS
ORDERED
Upon receipt of the request for inspection,
check the following documents:
1. PO – determine completeness as to date,
number, name and address of supplier,
suppliers acknowledgement or date of
receipt, nature and place of delivery,
accurate description of articles ordered,
quantity, unit price, availability of funds and
approval by the head of the agency or
representative.
 DELIVERY, INSPECTION AND
ACCEPTANCE OF ITEMS ORDERED

2. Supplier’s Invoice/Delivery Receipt –

• It should be pre-numbered and not just
typed, stamped or written separately;
• Check all dates indicated thereon; and
• It should conform with those in the
order/contract.
 DELIVERY, INSPECTION AND
ACCEPTANCE OF ITEMS ORDERED

2. Supplier’s Invoice/Delivery Receipt –

• Note ‘RECEIVED’ portion. Receipt and

date of delivery should be duly
acknowledged by the property officer.

3. Other required documents necessary for

a substantive inspection such as
catalogue/brochures/government
standard specifications, etc.
ACCEPTANCE OR REJECTION OF
DELIVERIES

The inspector may recommend for

rejection or reduction in price when
there is:
• a trend of shortage in quantity, or
• deficiencies/defects in quality is
established.
 ACCEPTANCE OR REJECTION
OF DELIVERIES

After consideration of tolerable

allowance, the inspector should
observe the following standards in the
evaluation of the result of inspection:
• Supplies or property tested and
found to be in accordance with the
required specifications shall be
accepted.
ACCEPTANCE OR REJECTION OF
DELIVERIES

Deficiency of less than 10% may be

accepted, provided:
• they shall serve the purpose for
which they were purchased;
• the defect is minor; and
• the contract price is reduced
according to the deficiency noted
 ACCEPTANCE OR REJECTION OF
DELIVERIES

Supplies or property whose

quantity is short by volume,
weight, actual count, etc. shall be
subject to reduction in contract
price at an amount equivalent to
the shortage, provided said
deliveries are acceptable to the
agency or unit.
 PAYMENT FOR THE ITEMS
DELIVERED

Basic Requirements in the Payment of

Supplies and Materials
 An original copy of the dealer’s invoice
showing the quantity, description of the
articles, unit and total value, duly signed by
the dealer or his representative;
 An indication of acceptance by a duly
authorized official/employee on the
invoice or on a separate document;
 Inspection and Acceptance Report (IAR)
 BASIC REQUIREMENTS IN THE PAYMENT
OF SUPPLIES AND MATERIALS

• Purchase Request approved by the

agency head or a duly authorized
official of the agency;
• Purchase Order issued by the agency
supported with:
a) Documentary evidence of public
bidding, if any, or
b) Canvass from at least 3 bonafide
dealers if emergency purchase was
resorted to
 BASIC REQUIREMENTS IN THE PAYMENT
OF SUPPLIES AND MATERIALS

c) If procurement was from a sole

distributor:
• duly notarized certificate of exclusive
distributorship of the dealer/ supplier,
properly attested by his principal
• certification by the Requisitioning
Officer, duly approved by the Agency
Head, that no suitable substitutes can
be obtained at terms more
advantageous to the government.
BASIC REQUIREMENTS IN THE PAYMENT
OF SUPPLIES AND MATERIALS

• Inventory Control Slip (ICS) shall

be used to acknowledge the
receipt of tangible assets with
serviceable life of more than one
year but small enough to be
considered as PPE, thus,
considered as inventories.
BASIC REQUIREMENTS IN THE PAYMENT
OF SUPPLIES AND MATERIALS

• Where the supplies and materials

delivered are subject to test, the
claims should be supported by
the evidence of sampling made
by the Technical Inspector in the
presence of the dealer or his
representative.
 ALTERNATIVE MODES OF
PROCUREMENT

• Limited Source Bidding

• Direct Contracting
• Repeat Order
• Shopping
• Negotiated Procurement
 LIMITED SOURCE BIDDING

• Involves direct invitation to bid

by the procuring entity from a
set of pre-selected suppliers/
consultants with known
experience and proven
capability on the requirements
of the particular contract.
 LIMITED SOURCE BIDDING

May be employed under any of the

following conditions:
• Procurement of highly specialized
types of goods (e.g. sophisticated
defense equipment, complex air
navigation systems and the like).
• Procurement of consulting services
where only a few suppliers/
consultants are known to be available
 LIMITED SOURCE BIDDING

May be employed under any of the

following conditions:

• Procurement of major plant

components where it is deemed
advantageous to limit the bidding to
known qualified bidders in order to
maintain uniform quality and
performance of the plant as a whole.
 DIRECT CONTRACTING

• This is also known as single source

procurement
• No elaborate bidding documents
• Supplier is simply asked to submit
price quotation or pro-forma invoice
together with conditions of sale
• The offer may be accepted
immediately or after some
negotiations
 DIRECT CONTRACTING

May be resorted to under any of the

following conditions:

• Procurement of items obtained

only from proprietary source, i.e.
when patents, trade secrets and
copyrights prohibit others from
manufacturing the same;
 DIRECT CONTRACTING
CONDITIONS
• When procurement of critical plant
components from a specific manufacturer,
supplier or distributor is a condition
precedent to hold a contractor to guarantee
its project performance, in accordance with
the provisions of its contract
• Procurement of those sold by an exclusive
dealer/manufacturer with no sub-dealers
selling at lower price and no substitute can
be obtained
 REPEAT ORDER

This is a method of procurement of

goods from the previous winning
bidder, whenever there is a need
to replenish goods procured under
a contract previously awarded thru
competitive bidding.
 REPEAT ORDER

May be resorted to under any of the

following conditions:
• Procurement of goods from the previous
winning bidder when the procured item is
clearly superior from the other bids not only
in terms of price but also in terms of
equipment reliability, availability of spare
parts, after sales services, delivery period,
etc.
 REPEAT ORDER - CONDITIONS

• contract prices still the same as or

lower than those in the original
contract

• will not result in splitting of contract,

requisitions or purchase orders (Sec
54, RA 9184)
 REPEAT ORDER - CONDITIONS

• availed only within 6 months from

the date of the Notice to Proceed
arising from the original contract

• not to exceed 25% of the quantity

of each item in the original contract
 SHOPPING

Procuring entity simply requests for

the submission of price quotations
for readily available off-the-shelf
goods or ordinary/regular equipment
to be procured directly from suppliers
of known qualifications
 SHOPPING - CONDITIONS

• unforseen contingency requiring immediate

purchase, provided amount not to exceed
P200,000

• office supplies and equipment not available in

the PS involving an amount not exceeding
P1,000,000 and provided it does not result in
splitting of contracts

• quotations from at least 3 bona fide suppliers

shall be obtained
***
NEGOTIATED PROCUREMENT

Procuring entity directly negotiates

a contract with a technically,
legally and financially capable
supplier/contractor/consultant
 NEGOTIATED PROCUREMENT

May be employed only in the following cases:

 Two failed public biddings
 Imminent danger to life or property during:
• a state of calamity, or
•when time is of the essence arising from
natural or man-made calamities , or
•other causes to prevent damage to or loss
of life or property, or restore vital public
services, infra and other public facilities
 NEGOTIATED PROCUREMENT,
CONT’D

• Take over of contracts, which have been

rescinded or terminated for causes provided
for in the contract and existing laws, where
action is necessary to prevent damage to or
loss of life or property
• when the subject contract is adjacent or
contiguous to an on-going infra project
provided that the original contract is the
result of a competitive bidding
 NEGOTIATED PROCUREMENT,
CONT’D

• Purchases of goods from another

gov’t agency such as the PS-DBM
• upon prior approval by the President
of the Philippines and when the
procurement involves major defense
equipment for use by the AFP
 NEGOTIATED PROCUREMENT,
CONT’D

• the Secretary of National Defense has

determined that the interests of the
country shall be protected by
negotiating directly with another
country with which the Philippines has
entered into a defense agreement
NEGOTIATED PROCUREMENT,
CONT’D
• When the procuring entities may not have
the capability to undertake a particular
procurement, it may request other GOP
agencies to undertake such procurement
for them
• Hiring of highly technical consultants where
trust and confidence are the primary
consideration – provided term
not to exceed 6 months, renewable but in
no case exceed the term of the HOPE
 NEGOTIATED PROCUREMENT,
CONT’D
• Small value procurement – where
procurement does not fall under shopping
and the amount does not exceed the
thresholds for shopping
• Lease of privately owned real property and
venue for official use, subject to guidelines
to be issued by the GPPB

• When an appropriation law earmarks an

amount to be specifically contracted to an
NGO
 NEGOTIATED PROCUREMENT,
CONT’D
 When it is desirable to call for the
participation of local communities and
 Procurement from specialized agencies of
the UN of any of the following:
a. small quantities of off-the-shelf goods,
primarily in the fields of education and
health;
b. specialized products where the number
of suppliers is limited, such as vaccines or
drugs.
 OTHER ACTIVITIES AFTER
PROCUREMENT
• Property Records to be maintained (Stock
Card)
• Recording of deliveries of supplies or
property in the books of accounts
(Supplies Ledger Card)
• Report of Supplies and Materials Issued
(RSMI)
• Inventory taking and preparation of Report
of Physical Count of Inventories (RPCI) on
semestral basis
 STOCK CARD (SC)

• shall be used to record all

receipts and issuances of
supplies. It shall be maintained
by the Supply and Property
Unit for each item in stock.
 SUPPLIES LEDGER CARD (SLC)

• SLC - shall be maintained by the

Accounting Unit for each type of supplies to
record all receipts and issuances.
• Transactions shall be posted promptly from
source documents.
• The semestral physical inventory of supplies
shall be reconciled with the supplies ledger
cards and controlling accounts and any
discrepancy/ies shall be immediately
verified and adjusted.
 REPORT OF SUPPLIES AND
MATERIALS ISSUED (RSMI)

- shall be prepared by the Supply

Officer and shall be used by the
Accounting Unit as a basis in preparing
the JEV to record the supplies and
materials issued.
• It is prepared on a daily basis based
on RIS served within the day.
• All issuances are summarized by stock
number.
 REPORT ON THE PHYSICAL
COUNT OF INVENTORIES (RPCI)

• shall be used to report the

physical count of supplies by type
of inventory as of a given date. It
shows the balance of inventory
items per cards and per count and
shortage/overage, if any.
 OTHER ACTIVITIES AFTER
PROCUREMENT

PURCHASE ORDERS – SUBMISSION

COA Circular No. 2009-001 dated February 11, 2009

• copy of any purchase order and

each and every supporting
document, irrespective of amount
within five (5) working days from
issuance thereof, to the Auditor
concerned
MEASURE OF LIABILITY OF PERSONS
ACCOUNTABLE FOR SUPPLIES OR
PROPERTY
The person in possession or having custody or
control of supplies or property is:

• immediately accountable therefor; and

• shall be liable for its money value in case of
illegal, improper or unauthorized use or
misapplication thereof, by himself or any
other person for whose acts he may be
responsible.
MEASURE OF LIABILITY OF PERSONS
ACCOUNTABLE FOR SUPPLIES OR
PROPERTY

He shall likewise be liable for all

losses, damage or deterioration
occasioned by negligence in
the keeping or use of property,
whether or not it is at the time in
his actual custody.
RETURN OF UNUSED SUPPLIES
AND SCRAP MATERIALS

Unused supplies no longer

needed after project
completion shall be returned to
the Property Custodian who
shall acknowledge receipt
thereof on the RIS indicating
thereon “Returned to Stock”.
RETURN OF UNUSED SUPPLIES
AND SCRAP MATERIALS

Scrap materials which may still be

used in the future shall be
returned to the Property Officer on
a RIS plainly marked “Scrap
materials returned to the Property
Officer/Custodian”.
Any Question?