FIACCT 08-05_00 Inventory – Inventory Control – Replenishment Process

Effective: March 16, 1998
Revised:
Reviewed:

Purpose

This policy describes the inventory control policies and procedures for performing inventory replenishment. This includes interfacing with the FINET Extended Purchasing Subsystem (EPS) to allow proper accounting transactions to occur.

Background

Agencies monitor their inventory usage to ensure adequate quantities are on hand to support their operations. FINET uses the following tables to monitor inventory usage:

ABC Parameter (ABCP) Table – This table is used to set parameters such as forecast method, safety stock factor, and lead time adjustment.
Inventory Inquiry (INVNQ) Table – This table provides information such as quantities available, quantities ordered, and quantities back ordered.
Inventory Inquiry (INVNU) Table – This table provides information such as previous usage,
forecasted usage, lead times, order up to quantity, safety stock quantity, reorder quantity and reorder
level.

As often as required, the Inventory Control personnel will run a data warehouse report to generate the Replenishment Review Report (IN90). This report identifies items that have reached their reorder quantities. It uses the following formula to determine items to be ordered:

Quantity on Hand + Quantity on Order – Quantity Reserved – Quantity Released – Quantity Back Ordered < Reorder Level

When this condition exists, the item is placed on the IN90 Report. The agency reviews the replenishment
quantities on the report and enters the appropriate order transaction, i.e., Delivery Order (DO) transaction,
Requisition (RQS) transaction, or Transfer Request (TRQ) transaction.

For RX orders less than $2,500 which do not need DAS – Purchasing involvement, create a Decentralized
Purchase Order (PD) transaction. This includes items less than $500, because an accepted Receiver (RC)
transaction is the transaction that updates the on hand quantities on the INVN Table, and the RC must
reference an accepted extended purchase order transaction (PD or RX). This program creates the DO, TRQ, SRQ transactions identified/selected above. When the DO, RQS or TRQ transactions are submitted, one of the following actions can occur:

DO – The vendor can be contacted and an order placed.
TRQ – The transfer request is sent to the warehouse that will be transferring the items.
RQS – DAS – Purchasing receives the request and processes it according to the Procurement Rules and Regulations.

Policy

Agencies monitor their inventory usage to ensure they have sufficient quantities of inventories on hand to support their operations.

Procedures

Responsibility

Action

FINET Operations
Inventory Control

Run the Inventory Replenishment Report (IN90 in Data Warehouse).

Technician

Review the IN90 Report and determine the desired transaction type (DO, RQS, PD or TRQ).
Obtain verbal approval from Central Inventory Control to create PD transactions for those items with a dollar value below $2,500 not under contract or available from the Central Warehouse, or that need to be replenished into the Central Warehouse. According to delegation levels, obtain verbal solicitations from vendors offering the item to be replenished. Award purchase according to DAS – Purchasing Policies and Procedures. Refer to the FINET Purchasing policies and procedures for further information.

Obtain electronic approval and process the PD transaction and, as required, a corresponding Phone Bid Quote (QUOT) Table entry. Refer to the Decentralized Purchase Order (PD) transaction section of this manual for instructions on how to enter a PD transaction, and the Phone Bid Quote (QUOT) Table for instructions on how to perform this entry.

DAS – Purchasing/
Agency Buyer/
Issuing Warehouse

Materials will be delivered by the Contractor/Vendor to the appropriate location. Refer to the Pick and Issue Procedure policy for information on receiving goods from a Transfer Request.

Warehouse Personnel

Receive the items and forward the packing slip or pick ticket to Inventory Control.

Inventory Control

Process a Receiver (RC) transaction for the items received (or perform a transfer receipt for items transferred). Refer to this section of the manual for instructions on how to process an RC transaction. RC transactions are required for PD orders also.