Administration Manual - B.E.S.T. Undertaking.

1508
These items are regularly moving items and are
stocked with the depots of Materials Management Department. There
are two types of systems followed for purchase of these items:
3.1.1 The fixed order quantity system
3.1.2 The fixed order Interval system
3.1.1 The fixed order quantity system
In this system, the ‘Recoupment Level’ (RL) is pre-
determined taking into consideration the Average Monthly Consumption
(AMC) during previous one year. Accordingly, as and when the ‘RL’ is
reached, the ‘Recoupment Slip’ (RS) is raised and forwarded to the
concerned consuming department for forecasting their requirement for
the next one year. The ‘RS’ indicates past 3 years’ consumption trend
to facilitate forecasting of material. The details of specifications, its
application, end use, etc. are also mentioned on R.S. The department
indicates their requirement for next 12 months. In case if it is
necessary, the department revise/modify the specifications in certain
cases. As a control measure, whenever the indicated requirement is on
higher side (say more than 25% of the past requirement), the
department has to justify the same by giving proper reasoning.
Considering the forecasted annual requirement, new RL, Minimum
Stock Level, Maximum Stock Level, etc. are decided for the item for
future guidance. The quantity to be put on the tender is worked out,
as per the Recoupment Policy furnished at later stage.
3.1.2 The fixed order Interval system
In this system, the period of recoupment is fixed and
is generally 12 months. The tenders processed through this system are
generally called as Annual Recoupment Schedules. The items of
similar nature say Road Springs, Tyres, Bearings, Street Lighting
Poles, HV/LV Cables, etc. are grouped together and a schedule is
prepared and is referred to the concerned consuming department in a
specific month, irrespective of stock position for forecasting their
requirements for next 12 months during the operative period of
schedule. Based on the requirements and considering outstanding