SSGC Complete Report

SSGC Internship Report Part Two
Prepared by
Samad Saleem Bombaywala
Internship Duration: Feb 3rd – Mar 17th, 2014
College of Banking & Finance
April 1st, 2014
SSGC Internship Report

SSGC Internship Report
Prepared for
Sui Southern Gas Company Ltd.
Department of Finance
Prepared by
Samad Saleem Bombaywala
Internship Duration: Feb 3rd – Mar 17th, 2014
College of Banking & Finance
April 1st, 2014

C. Acknowledgement
At the completion of this report, I’m first thankful to the One and Only Almighty ALLAH
who gave me ability to make this report, who gave me the courage, motivation, power and
eagerness and with his grace; today I am able to prepare my report on internship at Sui
Southern Gas Company Limited.
While the extent of my debts cannot be fully acknowledged, it is a joy to record my
gratitude to all the people, who helped us in the preparation of this report.
It is a pleasure to acknowledge my debts and express my special thanks to Mr. Ameen
Muhammad (Funds), Mr. Zafar Waqar (Funds), Mr. Qamar-ul-Hassan (Pre-Audit), Mr.
Tanveer Hussain (Pre-Audit), Mr. Gulab Baloch (Fixed Assets), Mr. Aurangzeb Khan (Fixed
Assets), Mr. Murtaza Ahmed (Sales Tax), Mr. Iqbal Ahmed (Cost & Budget), and Mr. Nisar
Ahmed (Cost & Budget). I would also like to thank Mr. Abdul Mujeed Khan (Imprest), Mr.
Kamran Iqbal (TF), Mr. Sarfaraz Ahmed (TF), Mr. Abdullah Zahoor (TF), Mr. Muhammad
Munir (TF), Mr. Khaliq Nazaz (TF), Mr. Zahid bin Yousuf (Gas Sales), Mr. Syed Rizwan
(Other Income), and Mr. Adeel Iqbal (Other Income) for providing their immense support
and unwavering guidance during conduct and completion of this internship report on SSGC
and it became possible for me to complete this work within short time.
I am also thankful to my Parents who cooperated with me and understood my problems
and work schedules throughout the report.

E. Table of Content
I. PART ONE
C. Acknowledgement
II. PART TWO
A. Personal Introduction
B. My Experience at SSGC
C. SSGC – The Company
1. Introduction
2. SSGC at a Glance
3. Company’s Vision
4. Company’s Mission
D. Main Functions of SSGC
E. Department of Finance
F. Divisions of Finance Department
1. Treasury Function
Loans Section
Revenue Control Section
Bank Reconciliation Section
Gas Sales Section
Cash & Bank Section
Non-Gas Revenue Section
Import Section
2. Finance
Payroll Section
NLO Section

LO Section
Gas Purchase Section
Insurance Section
Funds Section
3. Accounts
Cost & Budget Section
GDS Section
General Ledger Section
Fixed Assets & Capital Budgeting Section
Stores Section
Admin Section
G. Recommendations

Internship Report
Samad S. Bombaywala
A. Personal Introduction
Currently, I am studying at the College of Banking & Finance, an affiliated institute from the
Karachi University Business School (KUBS) in the BSBA (Four Year) program. As of
now, I have completed four semesters of my studies and have been successfully enrolled in
the fifth semester. At present, I have done introductory courses of Management, Economics,
Marketing, Finance and Accounting. However, I have developed substantial interest in
Finance and therefore, plan to do my majors in Finance. I had a keen interest in doing
internship in huge Governmental organisation such as SSGC (Sui Southern Gas Company)
as it would be beneficial for me in future since it is the leading and a well reputed company.
NIC #:
Date of Birth:
Father’s Name:
Gender:
Nationality:
Marital Status:
Religion:
Cell No:
Email Address:
LinkedIn Profile:
42501-8066155-7
March 24th, 1993
Mohammad Saleem
Male
Pakistani
Single
Islam
+92 0345 305 9815
samadbombaywala@gmail.com
linkedin.com/in/samadbombaywala

B. My Experience at SSGC
At the time when I joined SSGC, as
an undergraduate Student of
Karachi university, I had close to
no experience or knowledge
regarding the financial realm.
Dragging pre held notions
concerning the inefficiency
mundane nature of local
companies plus the tedious and
dull character of the business
world, I stepped into the door of
SSGC. It would be quite clichéd to
describe my experience as a
memorable one, however I would
like to extend to the staff of SSGC
my heart felt gratitude for
altering obstinate perceptions
about the work environment.
I found in these people the enthusiasm and zeal quite unexpected especially at this level.
Not only did the staff here welcome me warmly but also they extended their valuable time
to teach me the functioning of their respective sections while making it enjoyable and
appealing. I was absorbed into their everyday office lives instantly, receiving notice from
lower in the hierarchy all the way to the higher level management. Expecting discomfort in
a male dominated sphere, I was astounded yet proud at the improving gender ratio and the
equal treatment of both sexes at the office. I would like to applaud the continuous stream of
young management trainees; being incorporated into the system, since fresh perceptions
and fervor for an ambitious career keeps an organization up beat with an increasingly fast
paced world.
Finally I wanted to highlight the current growth rate of the Pakistani economy and the
adverse impact of the brain drain. SSGC has encouraged me to and stand out as a leader in
the driver towards prosperity and development.

C. SSGC – The Company
1.Introduction
Sui Southern Gas Company (SSGC) is Pakistan's leading integrated gas Company. The
company is engaged in the business of transmission and distribution of natural gas
besides construction of high pressure transmission and low pressure distribution
systems.
SSGCL transmission system extends from Sui in Baluchistan to Karachi in Sindh
comprising over 3,200 KM of high pressure pipeline ranging from 12 - 24" in diameter.
The distribution activities covering over 1200 towns in the Sindh and Baluchistan are
organized through its regional offices. An average of about 378,468 million cubic feet
(MMCF) gas was sold in 2007-08 to over 2.040 million (industrial 3,448, commercial
22,192 and domestic 2,014,827 consumers) in these regions through a distribution
network of over 31,877 Km. The company also owns and operates the only gas meter
manufacturing plant in the country, having an annual production capacity of over
550,150 meters.
The Company has an authorized capital of Rs.10 billion of which Rs6.7117 billion is
issued and fully paid up. The Government owns the majority of the shares which is
presently over 70%.
The Company is managed by an autonomous Board of Directors for policy guidelines
and overall control. Presently, SSGC's Board comprises of 14 members. The Managing
Director/Chief Executive is nominee of GOP and has been delegated with such powers
by the Board of Directors as are necessary to effective conduct the business of the
company.

2.SSGC at a Glance
The Company in its present shape was formed on March 30, 1989 following a series of
mergers of three pioneering companies, namely Sui Gas Transmission Company
Limited, Karachi Gas Company Limited and Indus Gas Company Limited.
Sui Gas Transmission Company Limited was formed in 1954 with the primary
responsibility of gas purification at the Sui field in Balochistan and its transmission to
the consumption centers at Karachi. Two distribution companies were established in
1955 and were responsible for the distribution of gas to consumers in Karachi and in
other towns along the route of the transmission pipeline between Sui and Karachi. In
1985, these two distribution companies were merged to form Southern Gas Company
Limited and later, in 1989, Southern Gas Company Limited and Sui Gas Transmission
Company Limited were merged to form the Sui Southern Gas Company Limited.
Today, half a century of professionalism and progress has made the SSGC one of the
largest integrated natural gas transmission and distribution companies in Pakistan,
serving the entire Southern region of the country, comprising the provinces of Sindh
and Baluchistan.
3.Company’s Vision
To be a model utility, providing quality service by maintaining a high level of ethical and
professional standards and through the optimum use of resources.
4.Company’s Mission
To meet the energy requirements of customers through reliable, environment-friendly
and sustainable supply of natural gas, while conducting company business
professionally, efficiently, ethically and with responsibility to all our stakeholders,
community and the nation.

D. Main Functions of SSGC
The Company is organized into four functional divisions -Transmission, Distribution, Meter Plant &
the Head Office. The Board of Directors has the overall responsibility for the management and
control over the Company. The management enjoys operational autonomy. The major portion of the
work force consists of technically qualified and skilled personnel.
As I did my internship in the Finance Department of SSGC, I’ll be discussing its different
sections & their sub-sections in this report.
E. Department of Finance
Finance department is one of the distinct departments in an organization or company. The primary
purpose of the Finance Department is to monitor and report on the financial position of the company
and to provide an excellent level of service to their customers and customers in other departments. The
financial department deals with everything that concerns finances in the company.
SSGCL
Transmission Distribution Meter Plant Head Office

F. Division of Finance Department
Department of Finance at SSGC is divided into three major sections that are as follows:
And now I would further discuss these department section in detail by mentioning their
sub-sections, their purpose & their functions.
Department of Finance
Finance Treasury Function Accounts

1.Treasury Function
The Treasury Function Department of the finance department basically deals with the
disbursements, collection, receipts, management of funds, payment of foreign or domestic
loans, revenue control and reconciliation of bank and customer accounts. In short, treasury
functions deals with the flow of money either in the form of inflows or outflows. An important
task of the Treasury function department is to keep a check on the company’s current liabilities
account and make sure that their current liabilities do not exceed their current inflows of cash.
The treasury function department can be further subdivided into five major categories, which
are somewhat interrelated. The division is as follows:
Treasury Function
Loan
Revenue Control
Bank Reconciliation
Gas Sales
Cash & Bank
Non-Gas Revenue
Import

LOANS SECTION-
Most of the organizations borrow loan from different banks to meet their capital expenditures and
working capital requirements. SSGC LTD is also involved in the activity of borrowing loans from
high profiled bank organizations. Loans are offered by banks in two categories.
1. Short term borrowings.
2. Long term borrowings.
Short Term Borrowing (Financing)
Short term borrowings are that kind of loans which are settled or which are paid off within one
year. Short term borrowings are mainly carried by SSGC LTD to meet its working capital
requirements. Working capital is defined as the money which is borrowed from different banks to
meet its day to day expenditures. Short term borrowing may be facilitated through much market or
overdraft facility. Overdraft facility may be renewed on yearly basis.
Long Term Borrowing (Financing)
Long term borrowings are that type of loans whose tenure is more than one year and maximum
limit of time period for the retirement for long term loans is 25 years. Long term borrowings are
mainly used to fulfill capital expenditure requirements. SSGC LTD normally makes 5-10 years capex
plan and borrows finance from banks through proactive plan.
Classification of Loans
Banks in two classes mainly classify loan. One is a conventional loan, means with interest. SSGC LTD
has to pay a certain rate of interest on conventional loans, which are decided after negotiations are
held between the two parties. Most probably SSGC LTD has to pay 25% on principal amount.

The other kind of loans is Islamic loans which doesn’t basically include any interest. In this case
SSGC LTD sells its anyone of the asset to a particular bank and receives money against it. At the
same time, SSGC LTD purchases the same asset from that bank. But now, the bank will sell it back to
the SSGC at some higher rate. So this higher rate, which has been received by bank against that
particular asset, is the profit, which is retained by the bank.
Process of Borrowing Loans
The management of SSGC LTD informs the loan section department for the requisition of loans and
current ratios and, equity ratios, which is also called finance covariance ratio. Loan department on
behalf of SSGC LTD sends invitation letters to different parties for the sanctioning of particular
amount of loan and get them approved by senior employees.
Receiving Of Quotations
SSGC LTD receives different quotations from all the banks which have been given offer. Evaluation
committee is settled down to decide which offer, bid or quotation should be selected. Evaluation
committee consists of auditors and finance members.
Selection of Bids
SSGC LTD chooses or borrows loan from that bank which offers lowest interest and, then
negotiations are held between two parties. After negotiations a certain rate of interest is fixed, and
SSGC LTD has to pay that particular rate of interest on its principal amount.
Mandate Letter
The loan sanctioning bank sends an agreement to SSGC LTD which includes different types of sub-
agreements. SSGC LTD examines and observes all the clauses of different agreements thoroughly,
and sends a mandate letter to that particular bank. Mandate Letter is a type of letter which is issued
by SSGC LTD to that particular bank for accepting their deal on different clauses.

Security Exchange Commission of Pakistan (SECP)
SSGC LTD notifies the security exchange commission of Pakistan that they are going to take loan
from a particular bank. They send the letter of charge to SSGC LTD and give them charge of their
assets, current assets are given as security for short term financing while for long term financing
fixed assets are given as security to SECP.SSGC LTD also gives insurance facility to SECP.
KIBOR
Benchmark is basically learned as KIBOR by State Bank of Pakistan. It was introduced in
2005.KIBOR is a fixed amount of interest which can’t be negotiate. Total amount of interest which is
paid by SSGC includes KIBOR rate and interest rate. KIBOR rate changes upon agreement, means
that if loan is borrowed for one year and State Bank has applied 3 months KIBOR, then after 3
months KIBOR rate changes while interest rate remains the same throughout the year. State Year
Bank of Pakistan also regulates prudential regulations regarding different policies.
Calculation of IRR
Loan section department calculates IRR to know all the hidden charges being charged by the bank
from SSGC LTD.SSGC LTD also calculates IRR by all cash flows. Cash flows includes annual charges,
out of pocket expenses, legal charges, arrangements charges if the loan is syndicated, and the last
are financial charges.
Signatures of Authorized Persons
Finally when the loan is approved for sanctioning, banks sends their signatories card to be signed
by authorized persons of SSGC LTD. these cards are signed by two signatories. First signatory is
form finance side and the second signatory is from sales department, IT department or other
finance. These cards are signed by two categories in order to ensure double check.

REVENUE CONTROL SECTION-
One of the major sections of Treasury Functions, Revenue Control Section us responsible for proper
management of sales, revenue and collection. The major responsibilities of this section are:
1. To check whether the collection of bills was within due date or after the due date.
2. As different things can be demanded from consumer in the bill, this section takes care
whether proper accounting is done under the required heads.
3. As, there is a separate accounting procedure for domestic, commercial and industrial
consumers, this section makes sure that one category consumer is not treated under the
head of other category.
4. To check whether the data is punched properly in the computer or in the day book and that
the proper accounting entries are made or not.
THE PROCESS:
The tasks assigned to this section need to be done with close observation and concentration. There
is a proper process of work, which is to be followed by the people working in this section in order
to manage the things accordingly and satisfactorily. The process starts from the collection of bills in
different branches of SSGC’s recommended banks that are authorized to carry out their collection of
bills.
THE ROLE OF BANK:
Banks are authorized to receive collections. But this is not the responsibility of bank to check
whether the consumer is industrial, commercial or domestic. So, the banks have to collect whatever

the amount is, and whoever the customer is. But this is the responsibility of every branch to make a
daily list of all the consumers who paid their bills on that day.
This list contains the serial number; consumer number and the amount paid by him. This list along
with a copy of bill receipts and credit advice is then sent to lead branch, which may be termed as a
representative branch of each bank.
BRANCH CONTROL:
The lead branch manages all its branches by receiving the daily collections from all the branches
along with the copy of bills.
A list of a control copy is then sent to SSGC at the end of each day by the lead branch.
MATCHING:
The revenue control section will then see, whether the amount submitted by each consumer in
bank matches with the stubs, which are received from NIFT, and whether the total of all the stubs is
equal to the amount shown in credit advice sent by the bank.
DATA ENTRY:
All the stubs are then sorted out bank-wise and are then punched in the computer. The consumer-
wise data is also maintained with the help of the consumer numbers mentioned in the stubs. That
consumer number represents, whether the consumer is industrial commercial and domestic
consumer.

DAILY REPORT (BD – 01):
A daily report is formed that represents the daily collection of consumer bills of a particular bank
at a particular date. This amount of DB – 01 is called daily sale. They do segregation in DB – 01 in a
sense that the data is separately punched for domestic, commercial and industrial consumers. The
collective amounts of these three types of consumers will then be transferred to daybook on daily
basis. These amounts are also transferred without segregation to collection book. The daybook, at
the end of month, is sent to Sales Accounting Section.
The revenue control section is liable to make sure that the collection processes are running
smoothly and timely and reports to higher management about the sales figure of each month.

BANK RECONCILIATION SECTION-
This section of Treasury Functions Department is responsible for making a bank reconciliation
statement. This statement identifies the amounts that were not included in the Bank Book
maintained by the company with the help of Bank Statement which is issued by the Bank. This
statement is made in order to rectify the discrepancies in the Bank Book maintained by the
company. This is a kind of matching the amount shown in the Bank Book maintained by the
company with the original amount present in the Bank Account. It deals with four types of different
discrepancies.
 Amount Debited by the Bank, not yet credited by the company
 Amount Credited by the Bank, not yet debited by the company
 Cheques issued but not presented in the bank
 Amount deposited, not yet Credited by the bank.
Amount Debited by the Bank, not yet credited by the company:
This includes the different type of amounts debited by the bank, but the company has not yet
lessoned it from its bankbook. Some of the examples are; Bank Charges, Commission, penalties etc.
Sometimes, it so happens that the company gets late in receiving the debit advice of different sorts
of charges from the bank. In this situation, this discrepancy normally occurs.
Amount Credited by the Bank, not yet debited by the company:
Same is the case with delayed credit advices. Company debits its bankbook after receiving the
credit advice from the bank. So, if the company gets late in receiving that credit advice, this sort of

discrepancy occurs. The Bank statement sent to the company shows the amount transferred in the
company’s account of which the company is not aware.
Cheques issued but not presented in the bank:
The company issues a large number of checks every day. At the time of the issuance of checks, the
company credits its bank book which shows that this much amount has been lessoned by the
company’s account from a specific branch. But some of these issued checks are not presented in the
bank by the check holders and the company earns unnoticed profit on that money which is still in
its bank account. As the company does not become aware of the time, that when the issued checks
will be presented in the bank, therefore company cannot make exact profit calculations. Bank
statement is then issued to rectify such kind of discrepancies.
Amount Deposited, not yet Credited by the bank:
Another type of discrepancy occurs in case of Bank deposits. For example, SSGC deposits certain
amount of money in some of its bank account by the issuance of deposit slip. At the time of issuance
of deposit slip, the company debits its bank book and considers that money as their current asset.
But sometimes, it so happens that banks take little time to credit that amount in the bank amount.
At that time, such type of discrepancy occurs.
After a certain period, the banks send “the bank statement” to the company, so that the company
can update its books according to the bank statement. Here is the sample of the Bank Reconciliation
made by the Company of its account in ABL (Civic Centre Branch, Karachi) based on the bank
statement issued by the bank.

GAS SALES SECTION-
As SSGC is a distribution company and they are not the producers. Therefore their main
concern is the distribution of gas to Domestic, Commercial and Industrial users. Gas Sales
Accounting department is responsible for the accounting of the above mentioned three
type of consumers. As the rates charged from these three types of consumers are different
so they make different accounting entries for them. Every consumer has been given a
consumer number, which gives the indication that whether the consumer is domestic,
commercial or industrial consumer.
 If the 1st digit of the consumer number is 9 then it is an industrial consumer
 If the 3rd digit of the consumer number is 9 then it is an commercial consumer
 Other than this are all domestic consumer numbers.
GAS SALES ACCOUNTING RELATED TO DOMESTIC CONSUMERS:
As far as domestic consumers are concerned, SSGC has established 12 Area wise zones, which cover
all the domestic consumers. Each zone is responsible for all the consumers, which come in its area.
These 12 zones are:

 City Zone
 Nazimabad
 Gulshan
 Malir
 Orangi
 Defense
 Society
 North Karachi
 Hub / Buldia
 Central
 Saddar
 Landhi
Zone Wise JV’s (journal vouture) are being sent to Head Office. The Gas Sales Accounting
department, then make entries in the subsidiary ledger and then to the consumer journal. Summary
of each zone is then transferred to General Ledger.
GAS SALES ACCOUNTING RELATED TO INDUSTRIAL & COMMERCIAL
CONSUMERS:
There are no zones for industrial and commercial consumers because they are far less in number as
compared to domestic consumers, and their data is maintained directly in head office.

THE PROCESS:
After the distribution of gas to these three types of consumers, there is a step-by-step process of
accounting for the gathered data.
 The process starts from meter reading.
 After the meter reading is done, the bills are then formed and then are raised to the
consumers.
 Daybook is then formed, related to the sale of gas. Data is punched on daily basis in the
daybook. This daybook contains the complete record of each an every consumer including
the volume of gas sold, meter rent, quantity etc.
 Any kind of customer complaints is dealt with including wrong billing adjustments.
 All the data is then updated in General Ledger and the adjustments are the made related to
customer complaints.
 The data is then recorded in the computer system. The system is monthly updated on the
basis of fixed price approved by Government of Pakistan. The system automatically
calculates the consumer’s bills on the basis of units shown by the meter reading.
 General Sales Tax is then paid to the Government of Pakistan on the overall collection of the
month.

CASH AND BANK SECTION-
This section of the Treasury function unit is responsible for receipts, payments and collection of
funds either in the form of cash or through cheque or through bank delivery. This section is further
divided into
 Cash Section
 Bank Section
Cash Section
Cash section deals with different sorts of payments which are required to be made in the form of
cash Everyday the cash section receives a certain amount of money (upto a certain limit) in the
form of petty cash and at the end of the day, the excess amount is returned to the strong room.
Strong room carries a certain amount of company’s cash in order to meet situations in which
immediate payments are required. This is a continuous process and a part of the routine activity.
Bank Section
The bank section is further subdivided into two main desks.
 Collection Desk
 Disbursement Desk
Collection Desk handles all the inflows whereas the disbursement deals with all the outflows and
disbursements

The collection desk is also known as collection book section. It deals with all sorts of collections that
made through various channels. SSGC has a very large customer base and this section is basically
responsible for collecting the returns from these consumers either in the form of Account
receivable or cash.
However there are certain other units with in cash & bank section which helps in facilitating the
task at hand and the assist the department in achieving its goals efficiently and effectively.
 Control Unit
 Facilitating Unit
 Authenticating Unit
 Harmonizing Unit
 Processing Unit
 Outdoor Shooting Unit

NON-GAS REVENUE SECTION-
Non-gas revenue is also important and fundamental department of Treasury functions. Non-gas
revenue means income from other than sell of gas.
SSGC earns a huge income from the sale of other materials and services. The four major sources of
non-gas revenue are:
 Condensate sell
 Sell of gas to JJVL for extraction of LPG.
 Gas meters sell
 Pipeline rental income
1. Condensate Sell
Condensate sell means the sale of liquid oil which is mixed up with some type of natural gases. One
of the most important field Badin gas field in Hyderabad. The gas which is extracted from Badin gas
field contains some quantity of liquid oil,. Before transmission of gas, oil is separated from that gas.
SSGC has installed separators for the separation of oil from the gas. After separating the oil from
gas, that crude oil, on the directions of government is sold entirely to Attock Refinery ltd Attock
Refinery LTD uses the crude oil in production of gas line.
2. SALE to JJVL (Jamshoro Joint Venture ltd)
SSGC LTD has also made an agreement with JJVL for under which JJVL by SSGC is SSGC LTD daily
supplies upto 200MMCF in JJVL plant from Badin field which is located in Hyderabad. The gas of
Badin gas field contains a large amount of liquid petroleum gas (LPG).JJVL extracts the LPG from
gas. This gas is then transmitted to consumers for domestic or commercial use. Liquid petroleum
gas is then filled in the cylinders and is sold in the market. The revenue generated from the sale of
LPG is received by JJVL.

The heating value of or chlorofic value (GVC) is reduced after the separation of LPG. Because of low
heating value, fewer amounts are recovered from the sale of this gas.
The volume and heating value is reduced after the separation of LPG. This difference of in and out is
called gas shrinkage. JJVL also pays royalty and transportation charges to SSGC LTD, which is the
income of SSGC LTD.
3. GAS METERS SALE
Gas meter sell is also an important source for SSGC for generating income. In 1976 meter plant was
installed for manufacturing of domestic gas meters. Previously the gas meters were imported from
foreign countries. But still industrial and commercial meters are being imported; only domestic
meters are produced by meter plant. Meter plant produces two types of meters. One is G-16 having
low capacity and others are G4 domestic meters which have large capacity. These meters are used
in the province of Baluchistan because of too much cold.
Selling Process
Meter plant has mainly two customers. One is SSGC LTD and other one is SNGPL LTD. Price for the
sale of meters to the SNGC LTD is negotiated between the two parties. Meter Plant transfers meters
at cost price to SSGC. Therefore, no profit no loss exists in the transaction of selling. SSGC LTD and
SNGPL charge meter rent to domestic consumers. Hence, it becomes a huge source of income.
4. Pipeline Rental Income
SSGC LTD is also striving hard to generate their income by renting pipelines. SSGC LTD mainly
constructs two types of pipelines.
 Transmission pipeline
 Distribution pipeline

Transmission pipelines are used to transmit the gas from gas fields to another. While distribution
pipelines are used to distribute the gas to different consumers. SSGC LTD has given on rent the four
gas transmission pipelines to different companies.
1. Pirkoh Gas Field
2. Hasan Gas Field
3. Zamzama Gas Field
4. Bhit Gas Pipeline

IMPORTS SECTION-
Introduction
Import section is also a fundamental operation of treasury function. This department or section is
mainly responsible to deal with all types of imports of SSGC LTD. import order is mainly comprised
of chemicals, component parts, pipelines, fillings, screws, bolt sets. SSGC LTD mainly carries its
imports transactions with Germany, France, Belgium, China, and America.
Order Procedure
Those who needs material or any type of machinery sends an indent to procurement department
for material requisition, this document indicates the quantity and quality of material for which the
order is being placed for.
Invitation of Tenders
Upon receiving the indent, procurement department issues tender among public and then,
quotations are received from various contractors. Then, the contract is given to that contractor
which offers lowest bid.
Offer for Opening (L/C)
The main procedure of import starts in favor of that particular contractor. Procurement
department sends all those legal documents of quotations, commercial evaluation to import section
for further procedure which includes application of letter of credit, purchase order, evolution
report and some other legal papers and, also approval of competent committee. The import section
then contacts different banks o open letter of credit (L/C) in favor of SSGC.MCB opens L/C in favor
of SSGC, which is sight L/C. sight L/C used in SSGC means payment is made to contractor on sight or
presentation of documents without any discrepancy.

Shipment of Order
After opening of L/C in favor of contractor, the goods are shipped by shipping agency too Karachi
dockyard which issues bills of lading to the head of Material Management department that goods
are being shipped as on the required order.
Clearance of Goods
Clearing agents cleans the goods on the port. A document known as bill of entry is prepared by
clearing agent which includes custom duty, general sales tax, income tax, and federal excise duty
etc.these al costs together re called landed cost. The clearing agent gets cleared all thee payment
and order is shipped to store and all the necessary shipping documents are send to bank by the
supplier.
Issuance of Receiving Statement
The goods are stored after received in a proper way, a receiving statement is issued to the head
office which is prepared item wise. Item cost is allocated in receiving statement on CNF basis.
Pricing Process
Treasury function department on getting receiving statement carries on pricing procedure. Pricing
of order is valued on the basis of its ratio cost.
Material Requisition Procedure
When the goods are in store then any department who needs any type of goods from the
store send a material requisition document (MR) which indicates the quality and type of
material. Store transfers goods by giving “debit adviser.’ If the material is required for
revenue, then revenue job is depicted and, if it is required for capital expenditure, then
capital job is debited.
The whole process of financial side of imports starts and ends on this department. SSGC LTD has
given the particular bank a ‘Debit Authority’ to pay and clear all the dues.

Margin against Shipping Guarantee
When the shipment documents are misplaced or get lost due to any mishaps, margin against
shipping guarantee is issued by bank PNSC or Supplier bank to a particular bank to pay all the dues
and clear the goods from the shipping port.

2.Finance Section
Finance section is one of the distinct departments in an organization or company. The primary
purpose of the Finance Department is to monitor and report on the financial position of the
company and to provide an excellent level of service to their customers and customers in other
departments. The financial department deals with everything that concerns finances in the
company.
Finance Section
Payroll
NLO
LO
Gas Purchase
Insurance
Funds

PAYROLL SECTION-
Payroll is one of the important sections of the finance department. It main functions include
preparation of SSGC Staff and Executive salaries every month, keeping record of all existing
employees and updating in case new appointments. Payroll section is divided into two main parts.
One deals with the Executive payroll while the other deals with the Staff. Salaries vouchers, Income
tax deductions, job wise summaries are all prepared by the Payroll Department
Flow of Data from Different Departments into Payroll Section
Payroll is the one of the most important section of Finance department... Its main activities includes
preparation of SSGC Staff and Executives’ salaries every month, keeping record of all existing
employees and updating in case of new appointments. Payroll section is mainly divided into two
parts. One deals with Executives payroll while other deals with staff. I was assigned to Executives
section that performs the following duties: such as salaries vouchers, Income tax deduction, job
wise summaries etc.
Payroll performs activities under THREE categories, which are as following:
 HRM related activities
 Salary related activities
 Miscellaneous activities
PAYROLL FUNCTION RELATED TO HRM ACTIVITIES
 HRM department make two types of appointment letter for executives.
1.CAREER APPOINTMENT
2.CONTRACT APPOINTMENT
Deductions For
 Leasing Co.
 Banks
 Insurance Co.

In the appointment letter the HRM Department clearly mention the grade of executive and its salary
& allowances.
After appointment letter, HRM dept make “Assumption of duty form for executive staff”. This form
include all necessary information such as executive no, name, date of birth, date of joining, religion,
designation, destination, account no etc.
On the basis of duty form, payroll dept make every month Pay Cards. On debit side it has pay &
allowances and on credit side deduction of contributions and loans. The items include in
contributions are: BEN.FUND, HAJJ, P.F, and EOBI. Company provides two types of loans Festival &
loan against P.F.
One more important activity of payroll section is making a “Final Settlement”. It happens when an
executive retire/terminate/dead/resign from the job .It is used to fulfill the difference between
salary & allowances and outstanding dues.
After final settlement they do generalization to offset the amount. If amount is payable they make
cheque payment voucher .If amount is recoverable then fund dept make cheque to balance the
amount.
At the end of each month they make unit wise Summary of payroll. Summary divided into two
parts:
Salary Summary
It includes the whole summary of payable & recovery amount without job no.
Salary Job Cost Allocation
It includes job no. E.g., finance, procurement, admin etc.

PAYROLL FUNCTION RELATED TO SALARY ACTIVITIES
 Data punching
 Compiling
 Summarizing
 Preparing bank advices
 Bank voucher
 Signing in payroll
 Issued to cash & bank
 In cash & bank make cheque & send to payroll
 Covering letter attach in payroll
 Issued to bank
 Generalization

NON-LOCAL ORDER (N.L.O)-
Non-local order deals with all the bills, which don’t involve the purchase order of goods. It
consists of all the expenses, which does not deal with the utility section of employee (i.e.
electricity, telephone, etc).
The most common expense heads that non-local order deals with are hospitals, chemists,
repair and maintenance of cars, emergency expenses of company e.g. stationary,
contractors for laying down pipelines, etc.
The core function of the department is registration of liability, which is done by Bank
Payment Voucher. It includes name of company/supplier, issue date, invoice no, term date,
amount, withholding tax etc.
 Withholding tax deduction on:
 Services 5 %
 Suppliers 3.5 %
 Transport 2 %
 Commission 10 %
To better understand the process of non-local order departments we shall take into
account an example, which is as follows:
Let’s suppose an employee falls ill and goes to a doctor enlisted in the company’s panel. After
diagnosing him/her the doctor sends a receipt to the company, the company issues an invoice
in favor of the doctor, then after verification of the said document it is directly sent to the cash

and bank department from which a cheque is issued of the stated amount. The approval of
payment is exactly the same as in local order.
The process is followed in N.L.O
 Step 1:
Receipt of bills/invoices from various departments duly verified and approved by
competent authority.
 Step 2:
Scrutiny of Bills/Invoices.
 Step 3:
Verification of job numbers, Basic Head and Budget provision.
 Step 4:
Processing of Payment Voucher.
 Step 5:
Authorization of Payment as per Financial Powers.
 Step 6:
Payment Vouchers sent top Cash & Bank Section for issuance of Cheques.
 Step 7:
Processing Statements for Income Tax deducted from suppliers.
 Step 8:
Depositing Income Tax into SBP on weekly basis.
 Step 9:
One copy of Challan to be provided to the Supplier/Contractor.
 Step 10:
Submission of monthly Tax return with the Income Tax Authorities.
 Step 11:
Reconcile supplier wise ledger cards in monthly basis.
 Step 12:
Passing necessary Journal Entries at the end of every month.

LOCAL ORDER (L.O.)-
The local order section is one of the most important sections of finance department. The local order
section is entirely responsible for the payment of bills to various suppliers and vendors. This
section is only responsible for make payment to the material suppliers. This section prepares the
voucher for only tangible goods not for intangible goods (services).
The main object of LO is to make ensure, secure and smooth payment to the supplier timely and to
gain the confidence of suppliers. The bill payments made under LO are classified into:
 Revenue Job denoted by 11/TKT
 Stores Stocks Items denoted by 12/TKT
 Capital Job denoted by 13/TKT
This section deals with material management department, R&D (store) and the suppliers. LO
section uses the Oracle application software to print a voucher after punching data into system. The
advantage of this software is that, if the wrong data is punched in to the system, the voucher will
not be printed.
LO section does not go through the payment process if any of the required documents are missing
just like, purchase order, receiving statement and the invoices.
In LO, payment system under go though some steps and procedures.

Functions of Local Order:
The core function of the department is to arrange payments against purchase orders issued by the
procurement department of Unit “A” & “C” in respect of the following purchases.
In this regard LO verifies invoices quantities and rates against Receiving Slip and Purchase Order
(PO) and ensure that the authorized person has approved these.
It is also the responsibility of LO to ensure that goods and services are recorded correctly i.e.
capitalized or charge to revenue account.
It is the practice of LO to reconcile their Bankbook Record with LO-Day Book and with their register
on monthly basis in addition to daily reconciliation.

CHEQUE CREATION
PROGRESS
INVOICE
TENDER ENQUIRY
INTENDS
QUOTATION
PURCHASE ORDER
APPROVAL
RECEIVING STATEMENT
LOCAL ORDER PROCESSING

GAS PURCAHSE SECTION-
RESPONSIBILITIES OF GAS PURCHASE SECTION:
Following are the responsibilities of Gas Purchase Section:
1. To receive the invoices of gas purchase every month from the field operaters which include
their joint ventures also.
2. Memo along with original invoice is send to measurement department through transmission for
verification of bills and the data is punched in oracle.
3. According to the gas sales agreement, payment for bills are made to local companies in local
currencies whereas the payment to foreign companies is made according to the procedure i.e. M
form with verified original copy of bills is send to State Bank of Pakistan for remittance
approval. After approval from SBP, the bills are paid in foreign currency from SSGC’s bank to
beneficiary bank.
4. To prepare schedules of Cost Of Gas and the schedules for Creditors quarterly.
5. To do Reconciliation between the records of gas supplier and the records of SSGC.
6. To maintain Purchase Register in respect of Sales tax.
7. To raise Inward Note monthly in respect of uniform cost.
8. To reconcile the GSC-1 statement.
9. Preparation of Revenue Budget of gas purchases.

WORKING OF GAS PURCHASE SECTION:
The Sui Southern Gas Company Limited is engaged in the business of gas transmission and
distribution in Sindh and Balochistan. The company receives gas from different oil and gas fields
located in Sindh and Balochistan. The natural gas received from these fields is transmitted to
different cities and towns of Sindh and Balochistan and then the gas is distributed to consumers.
There are total 15 fields and 4 towns controlled by Gas Purchase section. Each field has a operator
and under that operator there are several other joint ventures who supply the gas according to a
certain limit allowed to them. The operator has direct contact with SSGC whereas other joint
ventures contact to the company through the operator and their invoices also come under the letter
head of the operator.

FLOW CHART FOR THE PAYMENT OF GAS INVOICE:
In Case Of Foreign
Suppliers, The Payment
Is Done In Foreign
Currency After Approval
From State Bank Of
Pakistan
In Case Of Local Supplier,
The Payment Is Done In
PKR Rs:
Measurement
Department Verifies The
Bill Within 10 Days And
Send It Again To Gas
Purchase Section
Punching Is Done In
Oracle And New Batch Is
Created
Verification Letter With
Original Copy Of Invoice
Is Send To Measurement
Department
Invoice Received From
The Operater & Joint
Ventures For 1 Month
Period

INSURANCE SECTION-
RESPONSIBILITIES OF INSURANCE SECTION:
Following are the responsibilities of Insurance Section:
1. Insurance coverage of All the Assets and Employees of SSGCL under:
a. Fire Insurance
b. Motor Vehicles
c. Employees Benefit
i. Group Insurance
ii. Personal Accident
d. Marine Insurance
e. EAR Insurance
f. Casual / contract labour Insurance
2. Lodging and settling of Insurance claims under above mentioned policies.
3. Renewal of Fire Insurance and other policies on Annual Basis.
4. Preparing Budget of Insurance on Annual Basis of following:
a. Fire Insurance
b. Motor Vehicle Insurance
c. Employees Benefit

5. Payment of Debit Notes to NICL and Adamjee Insurance throughout the year.
6. Passing Recurring JV of Fire Insurance and Motor Vehicle on Monthly basis.
7. Correspondence with NICL.
8. Correspondence with Surveyors.
INSURANCE POLICIES MAINTAINED BY SSGC:
There are following types of insurance policies maintained by SSGC:
1. Fire policies.
2. Accident policies.
3. Marine policy.
4. Motor Vehicles policies (M.V).
5. Employees benefit policies.
a) Group life insurance.
b) Personal accident policy.
6. Erection all risk policy (EAR).
7. Voluntary insurance.
PROCESS FOR THE CLAIM OF INSURANCE POLICIES
When there is a damage or loss, the process of insurance starts. The first step is taken by the
location Incharge who informs Finance either or through concerned G.M. Further steps to be taken
are narrated below:

1. On receiving report of damage or loss, Insurance Section will enter the loss in Insurance
Register and allot a file no. this file no will be the reference no. of that claim for further process.
2. Immediately, a formal notice of claim will be served upon the Insurers.
3. On receiving formal notice of claim, the Insurer allots their claim no. (Reference no.) That will
be their reference in future and till finalization. A surveyor is also appointed at the same time by
the Insurer.
4. Insurance Section makes liaison with the appointed surveyors and arrangements are made to
take him to the place of survey in consultation and co-ordination with the concerned
department.
5. After completion of survey, the surveyor asks Finance Dep’t. To provide documents.
6. Usual documents required are:
 Claim Form: This form is completed and signed by department concerned and forwarded to
finance for onward submission to the surveyors and insurers.
 Copy of FIR where required.
 Statement of loss.
 Departmental Enquiry Report.
 Details of repair works.
 Documents in support of expenses incurred such as cash memo, receipts etc.
 Any other document as required by surveyors/insurers.
7. Documents are prepared and arranged by concerned department and are provided to finance
for onward submission to surveyors/insurers.
8. Documents are prepared in duplicate sets one each for the Surveyors and the insurers.
9. Insurance section always keeps strong and constant liaison with concerned department for
arranging /preparing claim documents.
On completion of claim document with the insurers, Insurance keeps pursuing insurers for
settlement.

FUNDS SECTION-
This section of finance department deals with the reserves or accumulation of money which is set
aside for specific purpose and the final settlement of the payments to the employees in relation
with Payroll Section. The criteria of payment for the final settlement include:
 Retirement
 Death
 Resignation
 Dismissal/ termination
There are separate rules for each case. Each payment is done accordingly.
The funds which Sui Southern Gas Company Limited deals with are:
 Pension Fund
 Provident Fund
 Gratuity Fund
 Benevolent Fund
PENSION FUND:
Literally, the term pension means,
‘Regular payment given to people who have crossed a certain age limit to enable them to carry out
their living expenditures without working’
Company provides 20% of the basic salary each month in the pension fund of the employee.
 On the death of an employee, 50% of the pension goes to the person’s widow.
 In the case where widow is also expired, 10% pension is given to the children under the age
of 18 years.
BENEVOLENT FUND:
The term benevolent means,
‘Showing goodwill, doing welfare or help to others’

This is another kind of retirement benefit given to executive employees after their retirement.
After being the member of this fund, employees need to pay 1.1% of their basic salary until a
minimum number of five years as a contribution.
The benefits of benevolent fund include:
 Executives receive the money till 5-years after their retirement.
 If person dies, and he is a member of benevolent fund, then his/her family receives this
money till 5- years.
 This is an additional benefit, excluding pension, gratuity and provident fund.
MONTHLY GRANT
PAY RANGE (RUPEES) MONTHLY BENEVOLENT GRANT (RUPEES)
Upto 15,000 1500
15,001-20,000 1650
20,001-25000 1800
 The monthly grant increases by Rs.150 for every Rs.5000 increase in salary.
WORKERS’ PROFIT PARTITIAN FUND (WPPF):
A law was introduced in late sixties, which made it mandatory for companies/firms/individual
businesses, to distribute five per cent of their pre-tax profit to workers under WPPF. But the law
was so framed that only a handful of workers, drawing minimum wages, (the upper limit being Rs
5,000) were eligible to share WPPF under a formula.
For Sui Southern Gas Company Limited, the spirit behind the WPPF laws was to make profitable
business share their fortunes with the workers. Another goal envisaged at the time of its creation
could be to lure workers to improve their productivity to make their company profitable so that
they may qualify for this extra bonus.

GRATUITY FUND:
Gratuity fund refers to,
‘Amount of money given for services rendered.’
Or
‘Monetary award given for meritorious services rendered without claim or obligation’
Company provides 8% of the basic salary each month in the Gratuity fund of the employee. This
appears as a cost to the company.
 On the death of the employee, gratuity of 40 days’ basic salary is given to the widow along
with 50% of the pension.
 No gratuity will be paid if employee is dismissed from the company.
 On retirement, if the employee opts for pension, then 20 days’ gratuity will be given.
 On retirement, if the employee opts for full gratuity of 50days, no pension will be given.
 Service exceeding six months is counted as a full year for service and calculation of gratuity.
For less than six months, gratuity shall not count.
PROVIDENT FUND:
The term literally means,
‘Providing carefully for the future’
The provident fund grants the employees retirement benefits. It enables the employees to save
fraction of their salary to be used in a situation when the employee is no longer able to work. The
provident fund primarily applies to retirement, but it also covers sickness, physical or mental
disability or death.
The moral is to give monetary security to employees when they retire.
 For non-executives, 8.33% of the basic salary is deducted from the payroll and is put into
the provident fund.
 For executives, 7.5% of their basic salary is deducted and is put into the provident reserve.
This section holds the money from the employees’ payroll and puts it in the A account which is
called ‘Employee Contribution”. The company puts exactly the same amount in B account, also
known as ‘Company Contribution.”
The person can withdraw the money from the fund as loan to acquire property, for marriage
expenses etc. Mr. Zafar Vaqar handles the loan payments and installment deductions from the
employees’ salary.

The loans provided to the employees by Sui Southern Gas Company are of two kinds:
 Refundable loan
 Non-refundable loan
REFUNDABLE LOAN:
 The employee will be able to get amount equals to his/her 6 basic salaries
 17% markup is implied
 5 years’ service is necessary to qualify for the loan
 The interest deteriorates each month in refundable loan.
 On returning the amount taken as a loan, the money in the fund again increases and the
employee will be given a profit on whatever the fund amount totals to.
 For general staff and non-executives, the loan is to be returned in 30 monthly installments
or 205 years.
 For executives, the loan is to be paid in 48 monthly installments or 4 year time period.
NON-REFUNDABLE LOAN:
 The employee will be able to get amount equals to his/her 18 basic salaries
 No markup implied
 Applying for non-refundable loan is like the employee is permanently withdrawing the
money form his/her fund.
 The profit which a person gets on keeping that fund will vanish.
 The employee needs to put the property papers as collateral to acquire non-refundable
loan.
At 50 years of age, the employee can withdraw 60% money from his/her fund without any markup.
In this case, there is no need to give any collateral.

INVESTMENTS
The cash present with the FUNDS SECTION is then invested in:
 Defense Saving
 National Saving
 Mutual Funds
 Shares
 Financial institutions/ Banks
 Pakistan Investment Bonds (PIB)
 Federal Investment Bonds (FIB)
These short-term and long-term investments produce profits which are then given to the
employees on the basis of their contribution in the funds and the investments.

3.Accounts Section
Accounting department provides accounting services and financial support to the organization it
belongs to. The department records, accounts payable and receivable, inventory, payroll, fixed assets
and all other financial elements. The department's accountants review the records of each department to
determine the company's financial position and any changes required to run the organization cost
effectively.
Accounts Section
Cost & Budget
GDS
General Ledger
Fixede Assets
Stores
Admin

COST & BUDGET SECTION-
Function:
The major function of cost and budget section is cost controlling and maintaining of
revenue expenses and also accumulation of revenue cost which is incurred during the
period, and planning for allocating the budget to the individual department. And another
function of this section is to calculate the cost of operating and administration section.
Purpose:
 To minimize the extra cost
 To operate the organization effectively and efficiently
 Closely watch t the individual department
 To run the organization smoothly
 To control the cost of operating and administration.
Budget Planning Process:
Cost & Budget is one of the hub sections of finance department. This section is
indispensable because planning & cost both are the backbone of every successful
organization and this section is first and foremost responsible for the budget planning.
Budget planning begins before the distribution of budget for the new fiscal year. The SSGC
provide the authority to every department to make their budget likewise, it means
department wise and it is controlled and maintained by the cost and budget section in
finance department. The 1st step of budget scheduling is “Proposal”. This section send
proposal to every department of company in order to know the requisite budget by the
departments. Every department suggest their required budget for the new fiscal year along
with the details where they want to spend budget and send the proposal back to cost &
budget section. The section checks their budget proposal and compare with previous
budget. In case of big difference between the current and previous budget the budget will
not approved before the justification of respected department.

Then this section brings together these proposals according to organizations wise and
sends these proposals to the board for the approval. The board makes necessary changes
and approves the compiled budget and report will send to every department. And
approved proposals are loaded in ERP system (Oracle Financial). The budget is to be made
according to year wise but it is issued quarter wise. After that we are uploading the budget.
Additional Budget & Re-appropriation:
This Re-appropriation form will use due to shortfall in budget or the departments spend
their budget before the specified period or that project is not mentioned in their budget for
whom they are sending the requisition. In order to solve this problem which are occurred
due to shortfall in budget, 1st the required department sends the appeal for Additional
Budget or Re-appropriation to CFO for approval of required material. After the approval
from CFO they sent that request to cost and budget section for further procedure.
The cost and budget section checks that from which department the required department
to take budget and also checks that is that department budget is available or not and also
check the required department is really needed for that material or not.
After checking and confirmed these things the cost and budget section transfer the budget
from the required department is needed through ERP.

GAS DISTRIBUTION SYSTEM (GDS)-
Introduction:
The Gas Distribution System (GDS) is one of the vital sections of SSGC’s Finance Department. The
basic task of the Finance department’s GDS is to perform all the accounting activities related to the
expansion of distribution and transmission network for enhancement of gas supply to power
plants, industries, domestic and commercial sector including supply of gas to previously deprived
areas in the domestic sector. Distribution System accounting include development of mains laying
rates (MLR) all region rectification and monitoring of Distribution Budget of all region and project
accounting related to distribution Projects.
For achieving the above mentioned targets the GDS of the finance department performs a number
of activities. These include preparation of feasibilities of Transmission projects and Gas fields under
various options, preparation and monitoring of Annual Distribution budgets for all new town and
villages, uploading the budget of each project on ERP system, processing Rehabilitation,
Reinforcement and New towns schemes of all regions including re-appropriation of Budget and
settling issues related to Distribution of all regions, maintaining funds position related to New
Towns & Villages and coordinating with Sales Department and Ministry of Petroleum & Natural
Resources (MNPR) in this regard . It includes submission of performance reports/ status reports to
MNPR through Sales.
Responsibilities of GDS:
The issuance of Job cards, Journalisation, reconciliation of deposit is also the responsibility of the
finance department. For the GDS, it is also necessary to ensure that the amount transferred to
Deferred Credit with respect GOP funds & customers advance is in accordance with IAS &
Company’s policy.
Preparation of financial feasibilities is one of the major tasks of this department. Feasibility reports
are prepared for providing recommendations to the managements regarding the approval of
various projects. These financial feasibilities and reports are prepared for the following projects.
For supply of Gas to Industrial, Commercial, CNG stations and Co-operative Housing society on cost
sharing basis.

 Transmission projects
 Supply of gas from Gas fields
 Construction of pipeline and to received pipeline rental.
 Supply of gas to New towns & villages on request of GOP
 Industrial estate
 Other Capital project
This section consists of one Deputy Chief Manager and two Deputy Manager. Two ERP executives
are also a part of the GDS team.

Standard Procedures Applicable to the Process of Distribution of Gas
Standard
Procedures
Request for
mains
Review of
request
Planning and
site survey
Cost
calculation
Feasibility
Payments
Issuance of job
card
Execution of
the job
Commissioning
advice
Issuance of
Circulars
Booking of cost

GENERAL LEDGER SECTION-
Function:
 Processing of all journal voucher (JV) from different section and location in finance department
 Resolution of queries raised by the ERP system during JV processing
 Posting of all financial modules to general ledger
 Processing of reports from oracle on monthly, quarterly, yearly basis for top management
 Processing of reports from oracle on monthly, quarterly, yearly basis for oil and gas regulatory
authority (OGRA)
Purpose:
 To maintain proper and accurate, books of accounts.
 To facilitate and co-ordinate the annual audit
 To comply with the policies and the procedure notified by OGRA from time to time.
 To comply with the policies and the procedure notified by Security and Exchange Commission
of Pakistan (SECP).
 To report the results to board of directors and shareholders of the company

The General Ledger Accounting Cycle

Follow these steps to enter, maintain, and report on actual accounting information for your
enterprise:
1. Open an accounting period.
2. Enter manual journal entries, including:
 Standard journal entries
 Foreign and dual currency journal entries
 Statistical journal entries
 Intercompany journal entries
3. Import journals from sub-ledgers. If you encounter an error when trying to import a sub-ledger
journal, you can correct the import data and rerun journal import.
4. Define recurring journal formulas for transactions that have a common format or that you enter
frequently. You can also create recurring journal formulas to create allocation entries.
You can use recurring journals to create three types of journal entries:
 Skeleton entries affect the same accounts each period, but have different posting amounts.
 Standard recurring journal entries use the same accounts and amounts each period.
 Formula entries use formulas to calculate journal amounts that vary from period to period.
5. Define Mass Allocation formulas to allocate a cost pool across a group of departments,
companies, etc.
6. Generate recurring journal and Mass Allocation journal batches based on formulas you defined.
7. Review the details of your unposted journal batches.
 To view and optionally change unposted journal batches online, use the Enter Journals
window.
 To view unposted journal batch detail online, use the Journal Inquiry window.
 To print a report showing unposted batch detail, produce a Journals - General report (set
the Posting Status parameter to unposted).
8. Edit unposted journals to change information about an unposted batch or its journal detail,
including the batch period and the journal currency.
9. Post your journal batches manually or automatically.
10. Check for posting errors. General Ledger automatically produces a Posting Execution Report so
you can check the results of your posting. This report notifies you of any errors.
11. Reverse journals. You can reverse a posted or unposted journal entry. Once you assign a
reversing period to the journal, generate and post the reversing batch.
12. Revalue your foreign-denominated assets and liabilities to reflect exchange rate fluctuations at
the end of each accounting period.
13. Translate your actual account balances to any foreign currency for reporting purposes.
14. Consolidate sets of books by defining and running a consolidation. You can consolidate sets of
books that have different charts of accounts and calendars.
15. Produce financial reports and perform online inquiries to review current account balances.

 Review account balances online using the Account Inquiry window.
 Review posted journal details in the Posted Journals Report, as well as in the General Ledger
and Account Analysis reports.
 You can also define an unlimited variety of custom reports using the Financial Statement
Generator to review account balances in the format of your choice.
16. Enter journals to clear suspense account balances. Examine General Ledger and Account
Analysis reports to identify the source of suspense account entries.
17. Close the current accounting period.
18. Open the next accounting period.

FIXED ASSETS & CAPITAL BUDGETING SECTION-
FUNCTION
To maintain and control the fixed asset of the company
Working of Fixed Asset:
Budget Proposal
The budget section of finance department prepares capital expenditure budgets annually
for all the department of SSGCL. Whenever a budget is to be prepared for any department,
the budget section notifies the department to prepare list of assets required by them &
forward it to the budget section. On receiving the requirements, the budget team examines
it & discusses all particulars with the related head of department & staff giving special
consideration to the justification of fixed asset requirement & funds available with the
company. At this stage, the budget team may reduce the requirements of fixed assets of the
department, which may be considered to be necessary as that may be defined to latter
period.
The budget [in the form of budget proposal] is now sent to GM & SGM for its
approval/changes which may be made by them & finally to the M.D for its approval the case
of transmission project which exceeds Rs.100 million approval is then sought from the
government by filing PC-1 form & after its approval , same procedure is followed for others.
When the budgets for all the departments have been finalized and approved by MD, then
agenda is prepared by budget section, which is reviewed by finance committee, the board
of directors’ grants approval to the agenda and now the budgets are authorized to be
followed.
Each department is now intimated through inter departmental note (along with a copy of
their budget) that the budget has been approved.

Fixed Asset purchasing process:
In order to purchase an asset, fixed asset requisition (FAR) is required to be filed by
concerned department, which should be approved by the head of that department. FAR
contains details of assets required by the department.
The FAR is now forwarded to Procurement department, where Deputy Manager checks
whether the FAR falls within the budget. The procurement department invites quotations
through tender (if not available in store) and on the basis of commercial and technical
evaluation and lowest bidders, a supplier is selected (all such procedures documented in
Evaluation Report) and then Purchase order (PO) is prepared and sent to supplier.
All assets are received by the KT stores department, where quality inspection is conducted
(however not documented) and then a Material Receiving Statement (MRS) is generated
and a copy of which is forwarded to the finance department.
Depreciation and Adjustment Process
Once an asset has been capitalized, working for its depreciation starts. Full year
depreciation is charged for the first year regardless of its purchase data. The company uses
the straight line method of depreciating except for meter plant, where reducing balance
method is used. Depreciation rates differ for different assets. It even differs for same assets
in different cities.
In the certain situation we call for making adjustments e.g. transfer of an asset from one
unit to another, different between assets in books and its physical existence etc.
Retirement of the Asset
After the completion of life of asset which is fixed by company we retire it. 1st the Assets
Retirement Requisition (ARA) is prepared by the user department and it is sent to the fixed
asset section of finance to retire that asset. The company SSGC’s follows certain policies for
the retire of asset e.g. only those asset which have a zero book value can be retired. After

checking the book value the inspection team is to be formulated. That inspection team
inspects the asset, which is to be retired for verification of the condition of the asset. After
inspection the report sent to the fixed asset section along with ARA. It is approved /
disapproved on the basis of inspection report by GM, DGM and MD. After approval the asset
sent to store at Karachi Terminal (KT) for disposal. In case an employee of the company
buys it, it is sold on written down value or at 7.5% of its cost, whichever is higher. And
some old assets, which are fully scraped and not present physically, are deleted from the
books through approval of the management.

STORES SECTION-
The store is responsible for receiving, keeping and sending all the necessary materials the
company uses for its operations in various locations throughout the country. All the items
have a 9-digit index number.
Purpose:
To check the store balances, maintain and control the records of every kind of
stock/material placed in stores at different locations of company.
Here, in SSGC Head Office record of each store all location in company is controlled and
checked for proper receipt and issue of items.
Working:
1. Extracting stores balances in ERP.
2. Checking of stores balances with ledger balances on ERP.
3. Reconciliation store stock loan balances with ledger balances for the more accuracy.
4. Checking of miscellaneous reports of stores balances for confirmation.
5. Preparation of reports of stores stock on quarterly, half yearly and annually.
Functions Performed By Company Stores:
Major functions are performed by company includes:
 Receipt of stores
 Issuance of stores for Distribution Projects
 Issuance of stores for Transmission Projects
 Issuance of stores for Meter Plant Projects
In order to fulfill these functions, company has several stores ate different locations. And
here we go in the detail of these stores by using tables.

STORE DEALINGS
Store accounting is based on meaning average basis. Each item has been allotted index
number according to the description and specification of material. Store index is based on
seven digits having fields of 00/00/000. 1st 2 digits denote main section to whom material
is to be sent e.g. HO, Trans, MMP, etc. 2nd 2 digits denote sub section e.g. Finance in HO etc.
3rd 3 digits denote serial no of item like as Printing Paper, Pen, Pipes etc. Stores system is
based on the following store documents:
1. Material Receiving Statement
 Foreign Receiving Statement
 Local Receiving Statement
2. Material Requisition
3. Inter Store Stock Transfer
4. Material Return Voucher
5. Adjustment Memo
Store accounting is based on above store documents for generation of cost of material
received of issued.

ADMINISTRATION SECTION-
Definition of Administration:
“An organizational unit that performs management activities benefiting the entire
organization includes top management personnel and organization headquarters”.
Purpose of Admin Department
The mission of Admin Department is to established procedure for setting the level of
finance admin. Admin department of finance facilitating the effective and efficient delivery
of their services at each section to resolve the queries and problems of the section, through
planning, police and performance they build a trusting relationship with their finance staff.
The Function of Administration Department
The Department lies within the Directorate of Finance and Administration. It is tasked with
providing administrative and logistical support to the entire organization.
Mandate of the Administration Department include:
 General office Management and Running.
 Transport Management.
 Registry Management.
 Assets Management.
 Property Management.
 Security and Safety.
1. General Office Management And Running Provides Services, Which
Include:
 Provision of offices for all staff.
 Provision of all office equipment for use by staff e.g. Computers.
 Ensuring a clean and secure office environment.
 Ensuring availability of adequate lighting, water, telecommunication, email, fax,
computers etc.
 Providing, where possible, designated parking for vehicles.
 Ensuring availability of stationery.
 Ensuring availability of crockery, furniture etc.
 Setting of internal operating rules.

2. Registry Management
All incoming and outgoing mails and vouchers (receipt/delivery/payment) must go
through the registry.
The registry must have in place good and efficient record filing and trucking
systems for all the records i.e. all mail must be recorded in a mail book and all
vouchers (receipt/delivery/payment) must be recorded into voucher register and
then the file/voucher (receipt/delivery/payment) sent to the addressee for action.
The registry shall maintain a file movement book for tracking all station files.
3. Assets Management
 This includes;
 Acquisition of assets
 Management of assets (engraving, locating, checking/counting etc)
 Recommending disposal of assets
4. Property Management
Management of all the property of includes buildings installations e.g quarry sites,
land, office equipment, stationery etc.
5. Security and Safety
 Security is supposed to be provided at all sites.
 Security should be for all assets and property (e.g voucher registers, staff’s
attendance register, stationery, office equipment etc).
 Users must ensure safety of assets in their possession.
 Risk assessment must be conducted to determine what special areas the security
firm shall cover.
Cash Payment Procedure:
Admin department has authority to make payment voucher/issue payment voucher for
office expenses. If the amount is below or equal to 10,000 rs then the admin officer signs
the approval for the final payment, whereas if the amount is above Rs.10, 000 then the
general manager (GM) only has the authority to approve the payment for office expenses.

Summary:
Administration section is basically engage in the assistance for all departments by
providing and procuring all the stuff required by the remaining sections of finance.
It is basically attached with the scrutiny section from where the vouchers come after
checking so that they can be validate through oracle module of accounts payables so that
payments can be made to the clients or employees.

G. Recommendations
 There should be a proper penalty system for the Banks who do not transfer the complete
amount of daily Gas Bill payment to SSGC every day. As I saw in the TF department, that there
were certain Banks who were deliberately retaining the Company’s rightful money for several
days, and in some cases even for weeks, just to make additional profit that normally went to
millions of Rupees – the amount which should have been the profit of SSGC-, but since there
has been no strick actions taken, those Banks are still doing this unethical practice.
 In Budget Section when proposals are sent to different departments, they should be instructed
that the increase in Budget should not be more than a certain percentage % from the last year
and for the expenditures which are necessary and are much more than that percentage should
be discussed with GM Finance or related person individually.
 There should be a proper schedule given to internees for their internship so that it will be easy
for them to cover important areas and to give proper time to each section.
 There should be an introduction session given to internees about the SSGC and their related
department which will help internee develop good understanding of Company and their
department.
I hope these actions to be taken as soon as possible, and our very own SSGC shines among
every other company in Pakistan.

SSGC Complete Report

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SSGC Complete Report