Inventory Issuance & Returns

Inventory Control Procedures

Objective

To ensure that materials are issued only when approved, recorded properly, and returned efficiently if unused. This process helps maintain inventory accuracy, prevents unauthorized withdrawals, and ensures that project materials are used efficiently.

Scope

This applies to all inventory issuance and return processes, including:

• Project materials issued to construction sites.

• Consumables and spare parts used for maintenance.

• Fixed assets temporarily assigned and later returned.

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3.1 Issuance Process

Inventory is issued only with an approved request to prevent overuse, waste, and stock shortages.

Step 1: Request for Material Issuance

• The requesting department submits a Material Issue Request (MI) in the ERP system.

• The request is reviewed and approved by the designated authority (e.g., Project Engineer or Department Head).

• Once approved, the Storekeeper prepares the requested materials.

Step 2: Physical Issuance & Documentation

• The Storekeeper verifies stock availability before processing the request.

• Materials are issued to the requester, and the transaction is recorded in the ERP system.

• The requester signs the Material Issuance Form as proof of receipt.

• The updated stock balance is reflected in inventory records.

Step 3: Inventory Supervisor’s Role

• The Inventory Supervisor does not directly handle issuances.

• Instead, they monitor issuance reports, ensuring that materials are issued according to company policies.

• They review monthly issuance reports and investigate any abnormal stock depletion.

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3.2 Material Returns

Materials may be returned due to over-ordering, unused stock, or defects. The return process ensures that materials are properly accounted for and restocked when possible.

Step 1: Request for Return

• The requester submits a Goods Return (GR) form in the ERP system.

• The reason for return must be stated (e.g., excess material, defective item, project cancellation).

• The return request is sent to the Inventory Supervisor for review.

Step 2: Physical Return & Inspection

• The Storekeeper verifies the returned items to ensure:

  • They match the original issuance record.

  • They are in usable condition.

  • Any damaged materials are separated for disposal or return to the supplier.

• The return is recorded in the ERP system, and stock levels are updated.

Step 3: Disposition of Returned Materials

• Usable items are restocked and available for future requests.

• Damaged or defective items are reported for disposal or supplier return.

• If the return is due to order mismanagement, the Inventory Supervisor investigates the cause.

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Case Scenario: Preventing Unauthorized Material Issuance

Scenario

A site foreman requests additional steel bars without an official Material Issue Request (MI), stating that it’s "urgent."

Actions Taken

✅ DO:

• The Storekeeper refuses issuance until a formal MI request is approved.

• The requester is directed to the Project Engineer for approval.

• The Inventory Supervisor checks stock reports to ensure that similar unauthorized requests are not repeated.

• The steel bars are issued only after proper approval and recorded correctly.

❌ DON’T:

• Issue materials without an approved request.

• Process verbal or handwritten requests without documentation.

• Skip recording the issuance in the ERP system.

• Allow excessive issuance beyond project requirements.

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Responsibilities

Role	Key Responsibilities
Inventory Manager	Approves issuance policies and investigates discrepancies.
Inventory Supervisor	Monitors issuance patterns and prevents overuse of materials.
Storekeeper	Issues and records materials based on approved requests.
Requesting Department	Submits issuance requests and ensures materials are used properly.

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