NNPCL SCM Quiz

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Questions and Answers

Which of the following is the purpose of the SCM manual for NNPC Limited?

To ensure consistent definition and application of procedures

To eliminate information gaps on policies and procedures

To implement internal guidelines and external regulations (correct)

To provide a clear definition of job responsibilities

What is the main objective of implementing the policies and procedures set out in the SCM manual?

To comply with reporting requirements

To ensure consistent application of procedures

To define job responsibilities

To maintain sound internal control systems (correct)

Who is the SCM manual prepared for?

Management and staff responsible for supply chain management tasks (correct)

Reviewers and signatories of the manual

Entities within the Company

SCM staff across the Group

Which of the following is NOT included in the structure of the manual?

Relationship Map Signup and view all the answers

What is the purpose of the Key Performance Indicators in the manual?

To determine the efficiency and effectiveness of the processes Signup and view all the answers

Who is authorized to grant exceptions to the application of the policy?

GCEO Signup and view all the answers

Which sub-functional areas does the manual apply to?

All sub-functional areas in the Supply Chain Function Signup and view all the answers

True or false: The purpose of the NNPC Limited SCM Processes and Procedures manual is to provide job descriptions for SCM staff

False Signup and view all the answers

True or false: The SCM manual is designed to ensure consistent application of internal guidelines and external regulations

True Signup and view all the answers

True or false: The SCM manual includes specific processes and procedures for the procurement of goods, works, and services

True Signup and view all the answers

True or false: Compliance with the SCM manual is optional for all users.

False Signup and view all the answers

True or false: A written waiver is required from the Head of the Function for noncompliance with a particular policy or procedure.

True Signup and view all the answers

True or false: The GCEO is authorized to grant exceptions to the application of the SCM manual without seeking ratification from the NNPC Limited Board.

False Signup and view all the answers

True or false: The SCM manual applies only to the Supply Chain Function and not to other functions in NNPC Limited.

False Signup and view all the answers

Which committee is responsible for reviewing and consolidating the Business Unit Procurement Plans?

Procurement Planning Committee Signup and view all the answers

What is the frequency of reviewing and approving the Procurement Plan in line with the budget?

Quarterly basis Signup and view all the answers

Which department is responsible for preparing the consolidated Procurement Plan?

Planning Department Signup and view all the answers

What is the document type of the Procurement Plan Compliance Report?

Output Signup and view all the answers

Which of the following is NOT an objective of the Plan Procurement process?

Define the policies and procedures for creating Procurement Plan. Signup and view all the answers

Which of the following is NOT a step in the Approach to Pre-Budget Procurement Planning?

Conducting a needs assessment and evaluation. Signup and view all the answers

What is the purpose of the Annual Procurement Plan?

To reflect all foreseeable procurement items required for the budget year. Signup and view all the answers

Which of the following is NOT a minimum requirement for a Procurement Plan?

The estimated timeline for the procurement Signup and view all the answers

Who chairs the Procurement Planning Committee?

Head of SCM Signup and view all the answers

What is the role of the Procurement Planning Committee?

Integrate each subsidiaries' procurement expenditure into its yearly budget Signup and view all the answers

What is the purpose of the quarterly review of the Procurement Plan?

All of the above Signup and view all the answers

True or false: The Plan Procurement process defines the policies and procedures for creating the Annual Procurement Plan?

True Signup and view all the answers

True or false: The Plan Procurement process aims to align the budget with procurement needs?

True Signup and view all the answers

True or false: The Plan Procurement process involves conducting market surveys to analyze the cost implications of proposed procurement?

True Signup and view all the answers

True or false: The Procurement Planning Committee is responsible for reviewing and consolidating the Business Unit Procurement Plans?

True Signup and view all the answers

True or false: The Procurement Plan Compliance Report is an output document of the Plan Procurement process?

True Signup and view all the answers

True or false: The SCM manual applies to the Supply Chain Function and other functions in NNPC Limited?

False Signup and view all the answers

True or false: Compliance with the SCM manual is optional for all users?

False Signup and view all the answers

True or false: A post-budget approved Procurement Plan is developed as an update to the pre-budget approved Procurement Plan.

True Signup and view all the answers

True or false: The Procurement Plan should include a description/specification of the goods, works, or services required.

True Signup and view all the answers

True or false: The Procurement Planning Committee is responsible for carrying out appropriate market and statistical surveys to analyze the cost implications of proposed procurement.

True Signup and view all the answers

True or false: The quarterly review of the Procurement Plan identifies opportunities for improvement and highlights any developments that impact other procurement activities.

True Signup and view all the answers

True or false: Strategic items have a low-profit impact and low supply risk.

False Signup and view all the answers

True or false: Leverage items have a low-profit impact but high supply risk.

False Signup and view all the answers

True or false: Bottleneck items have a high-profit impact and low supply risk.

False Signup and view all the answers

True or false: Routine items have a low risk and have a high impact upon organizational profitability.

False Signup and view all the answers

True or false: Category Management Procedures include reviewing and consolidating the Business Unit Procurement Plans?

True Signup and view all the answers

True or false: The purpose of the Category Management Procedures is to evaluate and define sourcing strategies for new categories?

True Signup and view all the answers

True or false: The Category Management Procedures require an annual review of the listing of categories on the system?

True Signup and view all the answers

True or false: The Category Management Procedures include preparing a justification for category consolidation or separation?

True Signup and view all the answers

True or false: Category Management refers to governing and managing categories which includes defining category portfolio management & segmentation, building business alignment, performing category analysis, defining buying channel and developing and executing category strategy?

True Signup and view all the answers

True or false: The Category Management process is designed to define the sourcing and category strategy to guide procurement activities in the business?

True Signup and view all the answers

True or false: The Kraljic matrix serves as a first level lens to categorize procurement items sourced by the organization?

True Signup and view all the answers

Which of the following is NOT a condition for considering multiple purchase requisitions as one transaction?

The originating department ensures that the requisitioned expenditure is within the procurement plan. Signup and view all the answers

What is the maximum tendering limit for the Board Level 1 Tenders Committee?

$8m Signup and view all the answers

Which committee is responsible for approving competitive single source contracts with a value greater than $100m?

None of the above Signup and view all the answers

Which of the following is NOT a policy for the Purchase Requisition process?

Threshold amounts and preferred vendors Signup and view all the answers

Who reviews every requisition in addition to the budget owner?

Immediate supervisor Signup and view all the answers

What is the purpose of the Purchase Requisition process?

To ensure compliance with the Budget and Procurement Plan Signup and view all the answers

True or false: The purchase requisition process involves the conversion of requisitions to purchase orders?

True Signup and view all the answers

True or false: The review of a requisition for conversion to a purchase order includes considerations on approval decisions such as threshold amounts and preferred vendors?

True Signup and view all the answers

True or false: The objectives of the purchase requisition process are to ensure commitment of resources for procurement needs and provision of key information for subsequent procurement-related activities?

True Signup and view all the answers

True or false: Purchase requisition splitting is allowed to circumvent approval limits?

False Signup and view all the answers

True or false: Multiple purchase requisitions and orders can be considered as one transaction if they are of similar nature and from the same business unit?

True Signup and view all the answers

True or false: The originating department is responsible for ensuring that requisitioned expenditure is within the procurement plan and complies with policies and procedures?

True Signup and view all the answers

The Determine Procurement Method process aims to ensure compliance with the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, 2010.

True Signup and view all the answers

The term 'goods' in the Determine Procurement Method process includes materials, furniture, fixtures, and office supplies.

True Signup and view all the answers

The mode of procurement is determined by the Business Department and validated by the Procurement Planning Committee.

False Signup and view all the answers

True or false: The award of the contract is solely based on the principle of the lowest bidder?

False Signup and view all the answers

True or false: Restricted Tendering (RT) allows any supplier to submit offers?

False Signup and view all the answers

True or false: Selective Bidding (Request for Quotations) is used for small contracts?

True Signup and view all the answers

True or false: Two-Stage Bidding is used for small and simple contracts?

False Signup and view all the answers

True or false: The second stage of the procurement process is to invite bidders to submit price and revised technical proposals.

True Signup and view all the answers

True or false: Sole/single-source procurement is used when goods, works, or services are only available from a particular supplier or contractor.

True Signup and view all the answers

True or false: Urgency and the specialized nature of goods and/or services are grounds for direct contracting in procurement.

True Signup and view all the answers

True or false: Repeat procurement can be applied within a period not exceeding one year from the date of the original tender.

False Signup and view all the answers

True or false: Competitive bidding is the preferred mode of procurement in many instances because it gives the business the opportunity to drive value for money.

True Signup and view all the answers

True or false: Sole/single sourcing is used when purchasing from a single source on the grounds of urgency or the proprietary/specialized nature of goods and/or services.

True Signup and view all the answers

True or false: Emergency procurement is used when the objective of the procurement will be defeated if it follows competitive or sole/single sourcing.

True Signup and view all the answers

True or false: Reverse auction is a procurement method where price is the only key differentiator in the procurement category.

True Signup and view all the answers

True or false: Emergency procurement can only be done when there is a work or operation stoppage, health, safety, damage to property, or environmental emergency requiring immediate supplier support.

True Signup and view all the answers

True or false: Reverse auction is a procurement approach that benefits critical standardized items where there are many suppliers/vendors.

False Signup and view all the answers

True or false: Purchasing Cards (P-Cards) are introduced by NNPC Limited for non-critical and high-value procurement to introduce sourcing efficiency of incidental or urgent purchase needs.

False Signup and view all the answers

True or false: NNPC Limited may employ a firm specializing in handling procurement as its agent when it lacks the necessary organization, resources, and experience.

True Signup and view all the answers

Which of the following is a reason for issuing an Expression of Interest in the procurement process?

To publicise the procurement need Signup and view all the answers

Under what circumstances does the two-stage tendering process, including the issuance of Expression of Interest, apply?

When the goods or works are subject to rapid technological advances Signup and view all the answers

What is the objective of issuing an Expression of Interest in the procurement process?

To advertise procurement opportunities to interested parties Signup and view all the answers

Which of the following is NOT a requirement for public advertisement of Expression of Interest?

The professional/technical competence of registered vendors Signup and view all the answers

What is the minimum response time required for Expression of Interests published in media?

14 days Signup and view all the answers

What does the Vendor response to Expression of Interest include?

All of the above Signup and view all the answers

What is the next step after the Evaluation Committee prepares the EOI Evaluation Report?

Consider and approve the report Signup and view all the answers

Which of the following is a policy for issuing a Request for Proposal/Quotation?

Ensure compliance with Nigerian Content requirements. Signup and view all the answers

What is the threshold value for requesting at least three (3) and not more than ten (10) service providers to make proposals without placing any notice?

N5m Signup and view all the answers

Under what circumstances may NNPC Limited engage in procurement by means of restricted tendering?

Both A and B. Signup and view all the answers

Which step should be taken if advertisement is required in the procurement process?

Prepare ITT/EOI Advert and forward to the Communication Team Signup and view all the answers

What should be done if advertisement is not required in the procurement process?

Send out RFP/RFQ document to target list of vendors Signup and view all the answers

What is the timeframe for issuing the Request for Proposal/Quotation (RFP) in the procurement process?

Within 1 week from date of receipt of strategy approval and Tender Document from User Department Signup and view all the answers

Which of the following is a criterion for vendor selection in the NNPC Limited SCM Processes and Procedures?

The compliance with Nigerian Content Signup and view all the answers

What is the purpose of public advertisement of Request for Proposal?

To ensure transparent competition Signup and view all the answers

What is the minimum response time required for Request for Proposal published in media?

14 days Signup and view all the answers

What is the margin of preference granted to domestic Contractors and Suppliers for goods manufactured in Nigeria?

15% for goods and 7.5% for works Signup and view all the answers

Which of the following situations may require the issuance of an Expression of Interest?

When the goods or works are subject to rapid technological advances Signup and view all the answers

What is the purpose of issuing an Expression of Interest in the procurement process?

To advertise procurement opportunities Signup and view all the answers

In which stage of the tendering process does the issuance of an Expression of Interest typically occur?

Prequalification stage Signup and view all the answers

Which of the following is a requirement for the public advertisement of Expression of Interest?

The need for wider exposure to potential vendors Signup and view all the answers

What is the minimum response time required for Expression of Interests published in media?

14 days Signup and view all the answers

What should be included in the Expression of Interest document?

All of the above Signup and view all the answers

What is the purpose of the EOI Evaluation Report?

To evaluate vendor responses Signup and view all the answers

Which step should be taken if advertisement is NOT required in the procurement process?

Send out RFP/RFQ document to target list of vendors Signup and view all the answers

What is the frequency of issuing Evaluation Input Committee Terms of Reference?

As required Signup and view all the answers

What is the performance measure for the timeliness in the issue of RFP?

Latest date of issue of RFP Signup and view all the answers

Which of the following is a requirement for issuing a Request for Proposal (RFP) in the NNPC Limited SCM Processes and Procedures?

Obtain vendor proposals Signup and view all the answers

What is the threshold value for requesting at least three (3) and not more than ten (10) service providers to make proposals without placing any notice?

N5m or threshold specified by Management Signup and view all the answers

Under what circumstances may NNPC Limited engage in procurement by means of restricted tendering?

Both A and B Signup and view all the answers

Which of the following is a criteria for evaluating proposals in the Vendor Selection Criteria?

The compliance with Nigerian Content Signup and view all the answers

What is the purpose of the Nigerian Content Objectives?

To grant a margin of preference to domestic Contractors and Suppliers Signup and view all the answers

What is the minimum response time required for a Request for Proposal published in media?

14 days Signup and view all the answers

Who is responsible for preparing the draft Request for Proposal?

User Department Signup and view all the answers

Which of the following departments is NOT a member of the Evaluation Committee for selecting suppliers?

Finance Signup and view all the answers

What is the scale used to weigh the sub-criteria for evaluating submitted proposals?

0 - 100 Signup and view all the answers

How many persons are required to constitute the Evaluation Sub-Committee?

5 Signup and view all the answers

Which of the following is NOT a factor considered in the technical evaluation of tenders?

Innovation and relevance of detail Signup and view all the answers

When are commercial tenders opened for vendors who meet the minimum technical score?

One week after the technical evaluation report is approved Signup and view all the answers

What happens if a tenderer refuses to grant an extension of validity for their tender?

They lose their Tender Security Signup and view all the answers

What is the main criteria for the acceptance of a bid by NNPC Limited?

Good grounds for award decision Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, how long does the organization typically allow for the preparation and submission of proposals?

30 days for Tenders and 14 days for proposals Signup and view all the answers

What happens to a Proposal/Tender received after the deadline for submission?

It is returned unopened to the Vendor, Contractor or Supplier Signup and view all the answers

What is the minimum and maximum validity period for bids in the first instance according to the NNPC Limited SCM Processes and Procedures?

60 days and 180 days Signup and view all the answers

Who chairs the Evaluation Sub-Committee for tender opening according to the NNPC Limited SCM Processes and Procedures?

The Secretary of the relevant Tenders Committee Signup and view all the answers

Which of the following is NOT a key performance indicator for evaluating tenders and selecting suppliers?

Cost-effectiveness of the selected supplier Signup and view all the answers

What is the purpose of the Evaluation Committee in the procurement process?

To analyse technical bids and present the report to the appropriate Tenders Committee Signup and view all the answers

What is the next step after the Evaluation Committee concludes the technical evaluation?

Review evaluation reports and approve the award of procurement Signup and view all the answers

What is the purpose of the Supply Chain Team in the procurement process?

To provide feedback to unsuccessful tenderers Signup and view all the answers

Which of the following is a requirement for submitting a bid security in the NNPC Limited procurement process?

The bid security must be issued by a bank acceptable to NNPC Limited Signup and view all the answers

Which of the following is NOT a valid reason for NNPC Limited to reject a tender security?

The tender security and the issuer conform to requirements and format prescribed in the tender documents Signup and view all the answers

What is the purpose of the tender security in the NNPC Limited procurement process?

To provide security for the performance of the contract Signup and view all the answers

What happens to the bid security document after the expiry of the tender security?

NNPC Limited returns or procures the return of the bid security document Signup and view all the answers

Which of the following is NOT a step in the Emergency Procurement Procedures according to the NNPC Limited SCM Processes and Procedures?

Consider and approve Memo Signup and view all the answers

What is the basis of measurement for the performance measure 'Timeliness of Ratification by Tenders Committee' in the Emergency Procurement Key Performance Indicators?

Days elapsed since procurement is completed Signup and view all the answers

True or false: Emergency procurement should be handled with expedition but without considering the gravity of each emergency.

False Signup and view all the answers

What is the maximum timeframe for the performance measure 'Timeliness of emergency proposal process' in the Emergency Procurement Key Performance Indicators?

1 day Signup and view all the answers

Which of the following is NOT a condition that must be met for emergency purchases under NNPC provision?

The Country, State or Business is seriously threatened by or confined with a disaster, catastrophe, war, insurrection, or Act of God. Signup and view all the answers

What is the main objective of emergency procurement?

To ensure a timely response to urgent need for goods and services in emergency situations while ensuring compliance with the general procurement principles. Signup and view all the answers

What is the basis for emergency procurement?

A legitimate work or operation stoppage, health, safety, damage to property or environmental emergency requiring immediate supplier support. Signup and view all the answers

Which of the following is NOT an objective of the framework agreement process according to the NNPC Limited SCM Processes and Procedures?

Securing the supply of materials over multiple delivery dates Signup and view all the answers

What is the basis for call-off when procuring goods and services in large quantities, but required as at when needed, according to the NNPC Limited SCM Processes and Procedures?

Framework agreement via call off contracts Signup and view all the answers

What should the approved blank order be based on in order to execute the framework agreement process, according to the NNPC Limited SCM Processes and Procedures?

The approved annual procurement plan and corresponding budget for each financial year Signup and view all the answers

Which of the following is NOT a key consideration in optimizing stock holding according to the NNPC Limited SCM Processes and Procedures?

Plant availability Signup and view all the answers

What is the responsible party for creating a Purchase Order (PO) according to the NNPC Limited SCM Processes and Procedures?

SCM Signup and view all the answers

Which document is NOT listed as an Input/Output document in the Frameworks Agreement Procedures according to the NNPC Limited SCM Processes and Procedures?

Goods Receipt Note Signup and view all the answers

What is the timeframe for the Timeliness of request process performance measure in the Frameworks Agreement Key Performance Measures according to the NNPC Limited SCM Processes and Procedures?

As required Signup and view all the answers

Which department is responsible for reviewing and approving the replenishment request for P-Cards?

N-3/4 Signup and view all the answers

What is the basis of measurement for the performance measure 'Timeliness of purchase reconciliations'?

Latest date for completion of the request process Signup and view all the answers

What type of documents are the reconciliation report and receipts considered as?

Support documents Signup and view all the answers

What is the timeframe for the performance measure 'Timeliness of Spend Analysis Report'?

Quarterly Signup and view all the answers

Which of the following is NOT an objective of the Administer P-Cards process according to the NNPC Limited SCM Processes and Procedures?

To establish framework agreements for small spend Signup and view all the answers

What is the purpose of the Administer P-Cards process according to the NNPC Limited SCM Processes and Procedures?

To streamline the purchase cycle for recurrent purchases Signup and view all the answers

Who are eligible to be assigned Naira P-Cards according to the NNPC Limited SCM Processes and Procedures?

All Delegation of Financial Authority holders and the Supply Chain Team Signup and view all the answers

Which of the following is NOT an eligible use of P-Cards according to the NNPC Limited SCM Processes and Procedures?

Approval to spend funds from the P-card shall be by the Head of Department Signup and view all the answers

Who is responsible for maintaining custody of P-Cards not held by DFA holders?

Supply Chain or HR Signup and view all the answers

What is the maximum funding limit for the P-card in the first instance?

N300,000 Signup and view all the answers

Who prepares the Spend Analysis of P-cards usage for insights and possible interventions in future procurement strategies?

Strategic Sourcing Unit Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, what is the purpose of Administer P-Cards process?

To reduce the need for imprests for key transactions Signup and view all the answers

Who are eligible to be assigned Naira P-Cards according to the NNPC Limited SCM Processes and Procedures?

Delegation of Financial Authority holders and the Supply Chain Team Signup and view all the answers

What are P-Cards used for according to the NNPC Limited SCM Processes and Procedures?

To procure unplanned and time-critical expenditure not covered by framework agreements Signup and view all the answers

Which department is responsible for approving P-Card requests?

Finance Signup and view all the answers

What is the maximum amount the P-card can be funded to in the first instance?

N300,000 Signup and view all the answers

What is the main purpose of the P-Card Custodian?

To file receipts and keep record of all P-Card transactions Signup and view all the answers

Which of the following is NOT an eligible use of P-Cards according to the NNPC Limited SCM Processes and Procedures?

Payment on invoices over N50,000 on the same expense heading Signup and view all the answers

Which department is responsible for reviewing and approving the replenishment request for P-Cards?

User Department (N-3/4) Signup and view all the answers

Who is responsible for conducting quarterly reviews of P-card expenditure and making recommendations to management?

SCM Signup and view all the answers

What is the basis of measurement for the performance measure 'Timeliness of purchase reconciliations'?

Latest date for completion of the request process Signup and view all the answers

What is the frequency of the performance measure 'Appropriateness of P-card purchases'?

As required Signup and view all the answers

Which of the following is a key objective of the reverse auction process according to the NNPC Limited SCM Processes and Procedures?

To ensure quick comparison of products and services needed Signup and view all the answers

When does NNPC Limited allow the use of reverse auctions according to the NNPC Limited SCM Processes and Procedures?

For any procurements where price is a material determinant Signup and view all the answers

What is the main benefit of the reverse auction process according to the NNPC Limited SCM Processes and Procedures?

Cost savings Signup and view all the answers

Which party is responsible for conducting an in-depth study of the spend volume and spend patterns related to a specific spend category?

SCM (N-4/5) Signup and view all the answers

Which document is used to create detailed specification documentation related to the product or service NNPC Limited plans on purchasing using the auction format?

Specification Template Signup and view all the answers

Which party is responsible for identifying the suppliers to invite to the auction process and providing training and documentation to the suppliers?

IT (N-3/4) Signup and view all the answers

Which party is responsible for reviewing the e-Auction bids and approving them?

Relevant Tenders Committee Signup and view all the answers

Which of the following is a requirement for conducting negotiations with a preferred bidder?

Obtaining written approval from the original approving authority Signup and view all the answers

What is the purpose of negotiating with a preferred bidder?

To achieve best value on any of the terms/components of the contract Signup and view all the answers

How many NNPC Limited personnel should be present during the course of any negotiation?

At least two Signup and view all the answers

Which personnel should represent the contractor in a negotiation meeting?

Management level personnel Signup and view all the answers

Who should sign the minutes of negotiation meetings?

Senior tenderer’s personnel Signup and view all the answers

When will the negotiated price be deemed accepted by NNPC Limited?

Upon management approval Signup and view all the answers

What should be added to the minutes of meeting for negotiation meetings?

A notice stating it does not constitute a contract Signup and view all the answers

Which department is responsible for placing an order directly with a vendor according to the NNPC Limited SCM Processes and Procedures?

Purchasing Department Signup and view all the answers

What is the purpose of issuing a Purchase Order (PO) according to the NNPC Limited SCM Processes and Procedures?

To formalize requirements and pricing Signup and view all the answers

Which party is responsible for reviewing the details of the Purchase Order and communicating acceptance?

Vendor Signup and view all the answers

Under what circumstances may NNPC Limited staff members make unauthorized purchases?

Without the prior consent of the Purchasing Department Signup and view all the answers

What is the performance measure for the accuracy of the Purchase Order?

Number of material errors, omissions, and misrepresentations in the PO Signup and view all the answers

What is the basis for emergency procurement?

All of the above Signup and view all the answers

Which department is responsible for drafting vendor contracts?

Contract Manager Signup and view all the answers

What is the frequency of the draft vendor contract input?

As required Signup and view all the answers

What is the performance measure for the accuracy of draft contracts?

Number of material errors, omissions, and misrepresentations in the contract Signup and view all the answers

Which of the following is a responsibility of the Contract Manager in the Contract Management process?

Assigning tasks to other staff members Signup and view all the answers

What is the objective of the Contract Management process?

To maximize operational and financial performance Signup and view all the answers

How often should contract progress meetings take place?

Quarterly Signup and view all the answers

Which department is responsible for reviewing and approving the replenishment request for P-Cards?

Contract Manager Signup and view all the answers

What is the maximum contingency provision for variations in a contract?

15% Signup and view all the answers

What is the minimum percentage of the contract value that must be provided as a Performance Guarantee?

10% Signup and view all the answers

What is the withholding tax rate for contracts of supplies?

5% Signup and view all the answers

Which of the following is NOT a type of provision that is usually included in contracts?

Work product and intellectual property ownership and rights provisions Signup and view all the answers

What is the maximum mobilization fee that may be paid to a Supplier or Contractor?

15% of contract value Signup and view all the answers

What is the maximum retention money that may be retained under a contract?

10% of contract value Signup and view all the answers

What is the total maximum amount of both performance security and retention fee that can be included in a contract?

20% of contract sum Signup and view all the answers

Which of the following is NOT a requirement for vendor registration with NNPC Limited?

Having clear definition of services and capabilities Signup and view all the answers

What is the purpose of the Vendor Management process in NNPC Limited?

To ensure value-driven vendor performance Signup and view all the answers

What is the role of the Supply Chain Management (SCM) in approving supplier deactivation decisions?

SCM reviews and approves supplier deactivation decisions Signup and view all the answers

Which of the following is a key area that suppliers are required to summarize their capabilities against in the Quality Assurance questionnaire?

d. All of the above. Signup and view all the answers

What are the Critical Success Factors (CSF) that must be considered to ensure the reliability and credibility of the supplier verification and qualification process?

d. All of the above. Signup and view all the answers

Which criteria are used to evaluate the performance of suppliers?

a. Price, Quality, Delivery, Service Signup and view all the answers

What action does NNPC Limited take with suppliers listed as defaulters on the system?

d. Terminate all business relationships with them. Signup and view all the answers

Which of the following is NOT a performance measure in the NNPC Limited SCM Processes and Procedures?

Timely generation of the Pre-Arrival Assessment Report (PAAR) Signup and view all the answers

What is the timeframe for issuing the SON-CAP certificate upon request?

Two days Signup and view all the answers

What is the basis of measurement for the performance measure 'Timely collection of Duty Assessment Slip'?

Submission of assessment slip by Agent Signup and view all the answers

Which incoterm does NNPC Limited adopt for all Materials Procurement and Engineering, Procurement and Construction (EPC) Contracts company-wide?

Delivered-Duty-Paid (DDP) Signup and view all the answers

Who assumes all risks associated with the execution of foreign procurement and EPC contracts on Delivered Duty Paid (DDP) incoterm basis?

Seller/Contractor Signup and view all the answers

What is the main objective of the Clearing and Haulage process?

To ensure smooth and timely shipment of goods Signup and view all the answers

Which party is responsible for determining the mode of procurement for NNPC Limited?

Business Department Signup and view all the answers

What is the purpose of the Pre-Arrival Assessment Report (PAAR) in the clearing and haulage procedures?

To upload shipping documents into Nigeria Customs Service (NCS) Server Signup and view all the answers

Who is responsible for arranging the loading and delivery of consignment to NNPC Fast Track Warehouse from Shipping and Terminal Operators for customs examination?

Clearing Agent Signup and view all the answers

What is the document type of the SON-CAP certificate in the clearing and haulage procedures?

Input/Output Signup and view all the answers

Which department is responsible for carrying out a quality inspection on goods delivered?

Inspection Team Signup and view all the answers

How many days does the inspection team have to carry out a detailed inspection of materials?

3 days Signup and view all the answers

Who receives the inspection report from the inspection team?

SCM (Supt, Receiving) Signup and view all the answers

What happens if the goods are rejected during the inspection?

The vendor removes the physical materials from NNPC Limited premises Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, what is the objective of the Goods Receipt process?

To ensure effective receipt and put-away of materials Signup and view all the answers

What is the timeframe for completing the inspection of all delivered materials according to the NNPC Limited SCM Processes and Procedures?

Within five (5) working days of delivery Signup and view all the answers

What should be done with materials that do not conform to specifications as stated in the Purchase Orders according to the NNPC Limited SCM Processes and Procedures?

They should be rejected and Vendors should be notified to remove them within seven (7) days of delivery Signup and view all the answers

Which of the following is NOT a requirement for the handling of hazardous materials according to the NNPC Limited SCM Processes and Procedures?

The Purchase Order must state the make-up/composition of the hazardous material. Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, what should be done if a discrepancy exists in the quantity of goods delivered during the goods receipt activity?

The officer should carry out partial delivery and accept the material. Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, what should be included in the information on the goods receipt register?

Time of arrival, date, PO number, vehicle number, company, and company representative's name. Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, where should the supervision of the off-loading/un-stuffing of materials take place during the goods receipt activity?

At the receiving bay. Signup and view all the answers

Which department is responsible for reviewing and approving the preservation work logbook?

DM Warehouse (N-4/5) Signup and view all the answers

What is the frequency of the preservation work programme input/output?

As required Signup and view all the answers

Who is responsible for regular inspection of the warehouse area?

Goods Receipt Officer (N5/6) Signup and view all the answers

Which of the following is NOT an objective of the Warehousing policy according to the NNPC Limited SCM Processes and Procedures?

Proper storage and distribution of stock items to the Users Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, who is primarily responsible for the security of materials held in stock?

Warehouse personnel Signup and view all the answers

What is the purpose of carrying out cyclic and perpetual inventory checks for all NNPC Limited stock of materials according to the SCM Processes and Procedures?

To enhance accountability for the Company's stockholding Signup and view all the answers

Which of the following items does NOT require further preservation at the storage stage?

Spare parts with light oily preservative Signup and view all the answers

What is the recommended action for smaller spares that are not supplied in sealed plastic bags?

Seal them in plastic bags Signup and view all the answers

What is the minimum height requirement for enclosing a warehouse or store?

2.6 m Signup and view all the answers

Which department is responsible for reviewing the Preservation Logbook and making recommendations for preservation work?

DM Warehouse Signup and view all the answers

Which of the following is NOT an objective of the Stock Review process?

Maximize stock ordering process Signup and view all the answers

According to the Stock Review process, what is the basis for inventory management?

Pre-set min/max reorder level Signup and view all the answers

Which department is responsible for deciding the type and quantum of stock to be held?

Supply Chain Management (SCM) Signup and view all the answers

Which department is responsible for maintaining records of each stock review exercise, including users' advice and copies of any write-off documents?

Supt., Inventory Planning (N4/5) Signup and view all the answers

What is the basis of measurement for the performance measure 'Accuracy of the excess and unmoved stock report' in the Stock Review Key Performance Indicators?

Number of material errors, omissions, and misrepresentations in the template Signup and view all the answers

What is the target timeframe for compliance with stock review targets in the Stock Review Key Performance Indicators?

Quarterly Signup and view all the answers

According to the SCM Processes and Procedures, what is the decision-making process for returning project spare parts into operational inventory?

If stock already exists, materials shall be taken into stock if consumption pattern, current stock level and on-order situation permits (i.e., stock levels shall not exceed normal maximum levels). Signup and view all the answers

What is the responsible party for generating a list of excess unmoved stock from the ERP MM System on a quarterly basis?

Supt., Inventory Planning (N4/5) Signup and view all the answers

What is the next step after the User Department receives the report on excess stock and confirms that the items are still needed?

Update management parameters (i.e., min/max stock) to accommodate the quantity required by the user department if the required stock level is not exceeded. Signup and view all the answers

What is the responsible party for processing the movement of materials via materials transfer procedure to relevant SBU/CSU if the items are not required by SBUs/CSUs?

Supt., Inventory Planning (N4/5) Signup and view all the answers

Which of the following is NOT a requirement for stocking office consumables and household goods?

Maximum stock levels Signup and view all the answers

What is the formula for calculating the minimum level of stock for items controlled under the minimum/maximum level method?

Minimum = (Average Estimated monthly Consumption x Total Elapsed Time in months) + Safety Stock Signup and view all the answers

Which of the following materials should be considered in the same manner as standard operating spares and require provisioning levels to be established if requested by the User Department?

Spare parts for maintaining drilling equipment and/or rigs Signup and view all the answers

What is the purpose of the Buy-back option in contractual agreements for stock items?

To allow for direct and immediate purchase from competent local Suppliers Signup and view all the answers

Which of the following is NOT an objective of Stock Replenishment in NNPC Limited?

Minimizing inventory holding while maintaining required service levels Signup and view all the answers

Which of the following is NOT a policy for Stock Replenishment in NNPC Limited?

Implementing Materials Requirement Planning (MRP) for effective inventory management Signup and view all the answers

Which of the following controls are NOT applied for effective inventory management in NNPC Limited?

Just-in-Time (JIT) inventory management Signup and view all the answers

Which formula is used to calculate the Economic Ordering Quantity (EOQ) for stocks?

Q = C (P + T) + R - (S + q) Signup and view all the answers

When can the Economic Ordering Quantity (EOQ) be fully utilized?

When the SBU/CSU has a computerized inventory management system in place Signup and view all the answers

What is the purpose of the review triggered when the stock quantity reaches or goes below the minimum level?

To decide upon the quantity to be ordered Signup and view all the answers

What is the basis of measurement for the performance measure 'Timeliness of the Stock replenishment process'?

Latest date for completion of stock replenishment process Signup and view all the answers

Which document is used to request the disposal of stock items?

Approved Disposal Request Form (DRF) Signup and view all the answers

What is the measurement basis for the performance measure 'Accuracy of the DRF' in the Key Performance Indicators?

Number of material errors, omissions, and misrepresentations in the form Signup and view all the answers

What is the target timeframe for the performance measure 'Timeliness of the circulation and response to list of materials to be disposed' in the Key Performance Indicators?

4 weeks Signup and view all the answers

Which movement type is used for the disposal of goods in compliance with NNPC Asset Write-off and Disposal procedures?

Movement type 551 Signup and view all the answers

Which of the following is NOT an objective of the Stock Write-Off & Disposal process?

Increased stock availability Signup and view all the answers

According to the Stock Write-Off & Disposal process, what is the purpose of writing-off and disposing of moribund materials?

To avoid wastage Signup and view all the answers

Which party is responsible for identifying materials to be written-off for disposal and completing the Disposal Request Form (DRF)?

Asset holder (User Department) Signup and view all the answers

Who is responsible for obtaining approval from asset owners to dispose of materials and forwarding the approved DRF to the SCM (Materials Requirements Planning (MRP) Controller)?

Manager, Supply Chain Management (SCM) Signup and view all the answers

Who is responsible for reviewing the DRF to ascertain if a potential hazard exists and making appropriate recommendations for disposal?

SCM Controller MRP Signup and view all the answers

Which party is responsible for adjusting the financial records accordingly after the disposal process is completed?

Finance & Accounts (F&A) Signup and view all the answers

Which department is responsible for receiving goods in the SCM Warehouse (N-6)?

SCM Warehouse (N-5/6) Signup and view all the answers

What is the basis of measurement for the performance measure 'Completeness Waybill & PO'?

Number of material errors, omissions, and misrepresentations in the document Signup and view all the answers

What is the target timeframe for the performance measure 'Timeliness of Rejection Notice'?

As required Signup and view all the answers

Which of the following is NOT an objective of the Stock Transfer process according to the NNPC Limited SCM Processes and Procedures?

Assimilation of new ranges of stock into warehouse. Signup and view all the answers

Which of the following is NOT a requirement for hazardous materials according to the NNPC Limited SCM Processes and Procedures?

Compliance with Logistics and Warehousing Policy Signup and view all the answers

What does the alpha-numeric location-based coding system in the NNPC Limited SCM Processes and Procedures facilitate?

Easy materials location and retrieval. Signup and view all the answers

Which document is required to be dispatched along with the materials during the receiving process?

All of the above Signup and view all the answers

What is the purpose of the Goods Movement process in the warehouse?

To locate materials in existing or new storage location and update quantity on warehouse card and MRV with storage location Signup and view all the answers

What is the purpose of the Material Transfer Voucher (MTV) in the stock transfer process between storage locations?

To move materials and serve as the Dispatch document for proper accountability of the handover of the material to the destination storage location Signup and view all the answers

What is the basis for the endorsement of the waybill in the stock transfer process from one plant to another?

Receipt of the materials in accordance with the goods receipt procedure Signup and view all the answers

Which document is used for the transfer of accepted goods (stock items) from the issuing warehouse to the destination warehouse in NNPC Limited?

Materials Receipt Voucher Signup and view all the answers

What action should the Officer, Warehouse take if there is an incorrect quantity discrepancy in the received materials?

Issue a discrepancy note Signup and view all the answers

Who is responsible for ensuring that all items in the warehouse are clearly labeled with the code number, description, and equipment tag number?

Officer, Warehouse Signup and view all the answers

Which document is used for the transfer of goods between storage locations in NNPC Limited?

Material Transfer Voucher (MTV) Signup and view all the answers

Which department is responsible for reviewing the User Department's submission of the Evaluation Criteria?

Evaluation Committee Signup and view all the answers

What is the purpose of the Evaluation Sub-Committee constituted prior to opening of bids?

To create an evaluation audit trail Signup and view all the answers

What is the basis of measurement for the sub-criteria 'innovation' and 'relevance of detail' under the 'methodology and work plan' criterion?

0 - 100 scale Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, how many days are allowed for the submission of Tenders?

30 days Signup and view all the answers

What happens if a Proposal/Tender is received after the deadline for submission?

It will be returned unopened Signup and view all the answers

What is the minimum validity period for bids in the first instance?

60 days Signup and view all the answers

What is the criteria for awarding the procurement contract?

The most economically advantageous tender Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, how are technical criteria graded in the selection methods subject to competition?

On a scale of 0 to 100 points Signup and view all the answers

For assignments of detailed engineering and design, which aspect is given greater weight in the evaluation criteria?

Consultant's proven experience and past performance Signup and view all the answers

For an assignment for construction supervision and implementation services, which aspect is considered more important in the evaluation criteria?

Key staff Signup and view all the answers

What happens to tenderers who refuse to grant an extension of validity for their tenders?

They lose their Tender Security Signup and view all the answers

Which document is required to be dispatched along with the materials during the receiving process?

Tender document Signup and view all the answers

What is the formula for calculating the minimum level of stock for items controlled under the minimum/maximum level method?

Minimum stock level = Reorder point - (Average usage x Lead time) Signup and view all the answers

How many NNPC Limited personnel should be present during the course of any negotiation?

2 Signup and view all the answers

What is the minimum response time required for Request for Proposal published in media?

6 weeks Signup and view all the answers

Which of the following is NOT a requirement for submitting a tender security?

The tender security must be issued by an issuer in the country. Signup and view all the answers

What is the maximum amount of bid security that can be required for procurements valued in excess of the prescribed sum?

2% of the bid price Signup and view all the answers

What is the purpose of the tender security?

To guarantee the performance of the contract. Signup and view all the answers

What happens to the bid security after the tender has been accepted?

NNPC Limited returns the bid security document to the bidder. Signup and view all the answers

According to the NNPC Limited SCM Processes and Procedures, what is the basis of measurement for the performance measure 'Timeliness of emergency proposal process' in the Emergency Procurement Key Performance Indicators?

Number of days elapsed since emergency is declared Signup and view all the answers

Who is responsible for engaging in direct contracting of goods, works, and services and initiating the Purchase Order (PO) process according to the Emergency Procurement Procedures in the NNPC Limited SCM Processes and Procedures?

SCM (N-2/3) Signup and view all the answers

What is the responsible party for preparing a detailed report immediately after the cessation of the situation warranting any emergency procurement and forwarding it to the relevant Tenders Committee for consideration and ratification in the Emergency Procurement Procedures in the NNPC Limited SCM Processes and Procedures?

User Department (N-2/3) Signup and view all the answers

What is the frequency of issuing the Evaluation Input Committee Terms of Reference in the NNPC Limited SCM Processes and Procedures?

As required Signup and view all the answers

Which of the following is NOT a condition for emergency purchases under NNPC provision?

The Country, State or Business is seriously threatened by or confined with a disaster, catastrophe, war, insurrection, or Act of God. Signup and view all the answers

In which of the following situations may emergency procurement by NNPC Limited be necessary?

When there is a sudden, unexpected occurrence that poses a clear and imminent danger to public safety or requires immediate action to preserve, prevent or mitigate the loss or impairment of life, health, property, or essential services. Signup and view all the answers

What are the objectives of the emergency procurement process for NNPC Limited?

To ensure a timely response to urgent need for goods and services in emergency situations while ensuring compliance with the general procurement principles. Signup and view all the answers

Study Notes

Purpose and Scope of the SCM Manual

The SCM manual for NNPC Limited provides guidelines and procedures for procurement activities.
The manual applies to the Supply Chain Function and other functions in NNPC Limited.
Compliance with the SCM manual is mandatory for all users.

Structure and Content of the SCM Manual

The manual is prepared for SCM staff and other stakeholders involved in procurement activities.
The manual includes specific processes and procedures for the procurement of goods, works, and services.
The manual does not provide job descriptions for SCM staff.
Key Performance Indicators (KPIs) are included in the manual to measure performance.

Governance and Compliance

The GCEO is authorized to grant exceptions to the application of the policy.
A written waiver is required from the Head of the Function for non-compliance with a particular policy or procedure.

Procurement Planning Process

The Procurement Planning Committee is responsible for reviewing and consolidating Business Unit Procurement Plans.
The committee reviews and approves the Procurement Plan in line with the budget at a frequency determined by the budget cycle.
The department responsible for preparing the consolidated Procurement Plan is the Supply Chain Department.
The document type of the Procurement Plan Compliance Report is a management report.

Objectives of the Plan Procurement Process

The objectives of the Plan Procurement process include defining the procurement needs of the organization, ensuring alignment of procurement plans with business objectives, and ensuring compliance with internal guidelines and external regulations.

Approach to Pre-Budget Procurement Planning

The approach involves conducting market surveys to analyze the cost implications of proposed procurement.
The approach aligns the budget with procurement needs.

Quarterly Review of the Procurement Plan

The quarterly review identifies opportunities for improvement and highlights any developments that impact other procurement activities.

Category Management Procedures

The Category Management Procedures include reviewing and consolidating Business Unit Procurement Plans.
The purpose of the Category Management Procedures is to evaluate and define sourcing strategies for new categories.
The procedures require an annual review of the listing of categories on the system.
Category Management refers to governing and managing categories, including defining category portfolio management and segmentation, building business alignment, performing category analysis, defining buying channels, and developing and executing category strategy.

Procurement Process

The procurement process involves the conversion of requisitions to purchase orders.
The review of a requisition for conversion to a purchase order includes considerations on approval decisions such as threshold amounts and preferred vendors.
The objectives of the purchase requisition process include ensuring commitment of resources for procurement needs and provision of key information for subsequent procurement-related activities.

Determine Procurement Method Process

The process aims to ensure compliance with the Nigerian Oil and Gas Industry Content Development (NOGICD) Act, 2010.
The term 'goods' in the Determine Procurement Method process includes materials, furniture, fixtures, and office supplies.
The mode of procurement is determined by the Business Department and validated by the Procurement Planning Committee.

Types of Procurement Methods

Competitive bidding is the preferred mode of procurement in many instances because it gives the business the opportunity to drive value for money.
Sole/single sourcing is used when goods, works, or services are only available from a particular supplier or contractor.
Emergency procurement is used when the objective of the procurement will be defeated if it follows competitive or sole/single sourcing.
Reverse auction is a procurement method where price is the only key differentiator in the procurement category.

Expression of Interest

An Expression of Interest (EOI) is issued to shortlist potential bidders for a specific procurement opportunity.
The objective of issuing an EOI is to shortlist potential bidders and to assess their capabilities and qualifications.
The EOI is published in the media with a minimum response time of 10 working days.
The Vendor response to EOI includes company profile, relevant experience, and qualifications.

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Test your knowledge of NNPC Limited's Supply Chain Management (SCM) processes and procedures with this quiz. Learn about the background and purpose of the SCM manual and review the revision history of the document.