This document outlines the procedures for purchase management. It includes details on: - Roles and responsibilities of the purchase management team - The process for selecting, evaluating, and re-evaluating vendors - Procedures for purchasing goods and services, receiving goods, issuing goods, and returning rejected materials - Maintaining infrastructure and handling non-conformities and corrective actions The key goal of the procedures is to ensure an efficient procurement process that meets the organization's needs through approved and qualified vendors while maintaining appropriate documentation and controls.

1. Purchase Management Manual
Procedure for Purchase Management
Saravanakumar N

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Contents
1 Abbreviation
2 Activities of purchase Management
3 Roles and Responsibilities
4 Procedures
4.1 Selection, evaluation, and re evaluation
4.2 Process of Purchase
4.3 Process for procurement of services
4.4 Process for Goods receipt
4.5 Process for Goods Issue
4.6 Return of rejected material
4.7 Payment Processing
5 Preservation of Products
6 Activities of Infra Structure Maintenance
7 Control of NC of products/Services, Analysis and Corrective Actions

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1 Abbreviations
MR -- Material Request
PM -- Purchase Management
CFO -- Chief Finance Officer
CEO -- Chief Executive Officer
PO -- Purchase Order
2 Activities of Purchase Management
Procurement of materials and services
o Inputs to procurement will come through purchase requisitions from user departments
Dispatch of required material to the required sites
o Input on the required material and required site will come from user department duly
approved by their functional head.
Maintenance of records of all the procurements, goods receipts and issues, Branch transfers
Maintenance of In-house Infrastructure and Equipment.
3 Roles and Responsibilities
Roles Responsibilities
Head PM Raising Purchase Proposals and obtaining management
approval
Release of Purchase / work Orders
Clearance for Branch transfers
Approving of payments to vendors
General Office administration
Overall control of departmental activities
Dy. Manager -PM Facility Management (Interior, Electrical and office
automation)
Procurement and preparation of approval notes pertaining
to purchases of infrastructure requirements
Processing of payments
Asset Management MIS
Management Trainee -PM Preparation of approval notes
Monitoring material consumption and planning for
materials
Processing of payments & MIS
Executive -PM Goods receipts and issues
Maintenance of stock records and ledgers.
Branch transfer of materials
Periodical Physical Stock Verification & MIS

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4 Procedure
The materials purchased by purchase department may be broadly classified in to
o Active Materials for user department
o Passive Materials for user department
o Specialty Service Providers
o Office administration and automation
4.1 Selection, evaluation, and re evaluation
· The company has prepared Approved Supplier List and categorized into the above
classification and has prepared an Approved Vendors and Service Providers List
(ASPL).
The existing vendors as prevailing as on 1/09/2011 have been identified and classified in
the above list. The list ensures that the vendors are either reputed MNCs or their
authorised distributors.
Criteria for Any addition to the existing ASPL as given below:
À The responsibility for evaluating additional vendors for active materials for both Active and
Passive and last mile is with CFO and Technical Team. Based on the technical evaluation
and the subsequent recommendation by CFO, the ASPL is updated. The records of such
evaluation are maintained by User Deployment
À For material categories of passive material, the vendors are being selected based on the market
reputation and brand of material. Technical evaluation of samples from the prospective
vendors is done on need basis to enlist them as source of supply.
À For speciality service providers, a reference check is done and upon satisfactory feedback they
are selected
À Vendors for office automation are selected based on the brand and market reputation.
· Performance evaluation of these suppliers/service providers is carried out once in 6
months based on the data recorded/feedback provided by user team. The user
department data is maintained month wise. The criterion for evaluation is presently
identified as number of NCR s (Non Compliance Record)/ deficiencies recorded.
· In case, any of the supplier/service providers is observed to have got a minimum of 5
MAJOR NCR s in any 3 quarters of a Calendar Year, they are subjected to re-evaluation
and re-selection. The control of quality of services provided by various outsourced sub-
contractors specially those who provide services in the area of civil constructions is
carried out based on NC reports provided by User Department Team.

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4.2 Process of Purchase:
For any Material requirement, the user department raises MRN duly authorised by
the functional head and handover to PM team.
PM team then checks for material availability in stock from the stock register from
stores.
If available in stock, it is issued to the concerned user department representative.
The Stock Register is updated accordingly.
In case on non availability of material in stock, the procurement process will be
initiated by calling for the quotations from the approved or new vendors. Once the
rates are negotiated, approval note will be circulated for management clearance.
Once approved by management, the purchase order is generated through SAP and
released to the supplier.
In case of some urgent requirements, the procurement will be carried out with verbal
or mail clearance followed by regularisation process.
Purchases upto Rs.25,000 will be made with the approval of Business Support and all
other purchases above the limit will be made only after the approval of CEO/COO.
4.2.1 Flow Chart

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4.3 Process for procurement of services
For procurement of new Services, and renewal of existing services, a
requisition/approval note has to be prepared by the user department and routed
through their functional head.
In both cases, the charges will be negotiated with the approved vendors and after
getting necessary approval of the management, work orders will be generated
through SAP and released to Vendors.
4.3.1 Flow Chart

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4.4 Process for Goods receipt
Once the goods reach the stores, a security inward seal is placed on the Delivery
challan of the Supplier and an entry is done in the security inward register.
The goods are then verified for the quantity with reference to the DC.
In case of any shortage or damage, it is recorded in the stores and informed to the
PM team. PM team will initiates necessary action in taking up the issue with the
supplier and arrange for fresh supply or replacement as required.
The Goods receipt note is prepared with reference to PO. The stock status is
updated in the register maintained at stores.
In case of excise duty component involved in the purchase, then the transporter
invoice copy along with a copy of the GR is sent to the taxation team to avail excise
duty credit.
Inspection of the goods is arranged through the user department and acceptance
report is obtained for records. Acceptance or rejection is communicated to PM
team for bills processing.

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4.4.1 Flow Chart

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4.5 Process for Goods Issue
All Material Issue Requests and Branch Transfer Requests is routed through the
respective functional head and based on the stock availability, PM team advise
stores for the release of the material.
In case of non availability of stock, it would be procured by following the purchase
process and materials are made available for issue.
In case of Goods issue, a Delivery Challan/Delivery Note and a Gate pass are
prepared and material is handed over to the user department representative. Stock
status is updated manually in the stock register.
In case of Branch Transfers, the following documents are prepared; material packed
in proper condition and informs the transporters of the material pickup for shipment
o Form 27
o Branch Transfer Note
o Prepare declaration on Not for Sale
The details of material outwards are entered in the security outward register.
Details of Branch transfers are maintained and a monthly report is sent to the
taxation department.

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4.5.1 Flow Chart

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4.6 Return of rejected material
In case of goods rejection due to damage or non compliance to our specs, the goods are
returned to the supplier with a delivery challan
The stock ledger is updated for the same and the material handed over to the supplier
/ authorized transporters.
Once the replacement materials is received, fresh GRN is raised to that effect and sent
to SCM for bills processing
In case of an import material, an RMA is arranged from the overseas supplier for its
return and replacement. Relevant documents are prepared for shipping it out to the
supplier.
4.7 Payment Processing
As per the terms of purchase, if any advance payment is applicable, payment request
will be raised in the prescribed format and handed over to finance.
Along with the requisition note, the invoice, Challen copy, PO copy and GRN will be
attached.
Inspection Report or Usage report or Service completion certification will be taken
from the user function and the same will be attached as required.
5 Preservation of Products
The company maintains a warehouse for the preservation of equipment brought for
service of the customer
Materials are arranged category wise and stored in the original manufactures packing
boxes to ensure their quality.
There is no shelf life item involved in material storage in ware house.
The company maintains a stock ledger that is being updated based on the receipt and
issues.
6 Activities of Infra Structure Maintenance
The company has prepared a list of various equipment such as DG set, UPS, Fire
extinguishers etc., being maintained.
The preventive maintenance of the above has been outsourced to reputed service
providers as identified in the ASPL.
The company has entered into a service contract and issued work orders to
periodically verify the functional and performance aspect of the equipment.
After completion of maintenance by the service providers, the records of
maintenance are verified and ensured that the equipment has adequate capability
to meet continued requirements.
PM maintains the records of all maintenance contracts.

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When a Break down occurs in any of the equipment, the outsourced service
providers are called in to put their equipment back to operation.
PM maintains the records of such break-downs.
In the case of fire extinguishers, the SCM arranges to verify the condition
periodically and carries out necessary maintenance.
In the case of fire alarms, the verification is carried out periodically for various
functions.
The Bio-metric Access Control installed at the entrance of each floor is being tested
for the correctness periodically and ensure that they are not tampered with.
Records of such verification are maintained on a Monthly Basics.
7 Control of NC of products/Services, Analysis and Corrective Actions
Based on NC data from the deployment team, Head PM collates them, analyse the
root cause of such Non-conformities and evaluates the need for corrective
actions.