Stock Write-Off & Disposal Process

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Match the following disposal methods with their descriptions:

Sales to third party (open bidding) = Materials are sold through a bidding process to external parties Sales by auction = Materials are sold through an auction to interested buyers Destruction = Materials are disposed of by rendering them unusable or unrecognizable Return to inventory = Materials are put back into the organization's stock for future use

Match the following responsibilities with their roles in the disposal process:

Asset holder = Identifies materials to be written off and disposed of SCM MRP Controller = Registers the DRF details, circulates it to other departments, and arranges for material transfer if applicable Finance & Accounts = Handles financial adjustments, insertion of book value, and removal from the asset register Assets Disposal Committee = Commences the disposal process after receiving the approved DRF and relevant documents

Match the following criteria for disposal with their descriptions:

No longer fit for use = Materials are no longer suitable for their intended purpose In excess of requirements = Materials are more than what is needed for current or future projects Obsolete = Materials are outdated and no longer in use or production Damaged = Materials are physically impaired and cannot be used

Match the following objectives with their descriptions:

Ensure that all identified moribund materials are written-off for disposal. = Objective 1 Remove non-moving items for which full justification has been approved. = Objective 2 Remove moveable assets for which full justification has been approved. = Objective 3 Reduce cost of storage and avoid wastage. = Objective 4 Signup and view all the answers

Match the following policies with their descriptions:

No item shall be disposed from inventory until the primary user department confirms no further use for it. = Policy 1 Processing of excess, obsolete or damaged stock, once approved, shall be treated as disposal stock. = Policy 2 Subsequent to the disposal process being completed, goods shall conclude by means of SAP issue movement type transaction 551. = Policy 3 Disposal of goods shall conclude by means of SAP issue movement type transaction 551 (withdrawal for scrapping). = Policy 4 Signup and view all the answers

Match the following principles with their descriptions:

NNPC Stocking Policy = Principle 1 Asset Management Principles = Principle 2 Accounting Principles = Principle 3 Operational Excellence Principles = Principle 4 Signup and view all the answers

Match the following departments with their roles in the disposal process:

Engineering department = Role 1 Maintenance department = Role 2 Operations department = Role 3 Warehouse department = Role 4 Signup and view all the answers

Match the following outcomes with their descriptions:

Reduced cost of storage and avoidance of wastage. = Outcome 1 Improved warehouse efficiency. = Outcome 2 Sustainable environmental development. = Outcome 3 Operational excellence. = Outcome 4 Signup and view all the answers

Match the following movement types with their descriptions:

SAP issue movement type transaction 551 (withdrawal for scrapping) = Movement Type 1 SAP issue movement type transaction for disposal stock = Movement Type 2 SAP issue movement type transaction for non-moving items = Movement Type 3 SAP issue movement type transaction for moveable assets = Movement Type 4 Signup and view all the answers

What is one of the specific requirements for PIA implementation mentioned in the text?

Creation and funding of host community development trusts Signup and view all the answers

What is the main purpose of the relaunching of NNPC as NNPC Limited?

To operate as a commercial entity and raise its own funds Signup and view all the answers

According to the text, who has control over the selection of NNPC Limited's management team?

The Minister of Petroleum and Finance Signup and view all the answers

What is NNPC Limited required to do in terms of financial reporting?

Publish annual reports, audited accounts, and declare dividends to private shareholders Signup and view all the answers

What aspect of NNPC's operation is intended to change with the relaunch as NNPC Limited?

Government dependence and independence in raising funds Signup and view all the answers

What authority was responsible for the formation of the Nigerian Upstream Petroleum Regulatory Commission?

The Nigerian government Signup and view all the answers

What is the timeline given for the Minister of Petroleum and Finance to determine and transfer the assets, interests, and liabilities of NNPC to NNPC Limited?

18 months Signup and view all the answers

What is one of the areas where NNPC Limited is required to pay its share of fees and taxes?

Community development projects Signup and view all the answers

What is the expected relationship between NNPC Limited and government support after relaunching?

NNPC Limited will still depend on government support for operations Signup and view all the answers

What significant impact is expected from the relaunching of NNPC as NNPC Limited?

Enhanced transparency through regular financial reporting Signup and view all the answers

What is the significance of the Petroleum Industry Act (PIA) 2021 and the establishment of the Nigerian National Petroleum Company (NNPC) Limited?

It led to the end of the Nigerian National Petroleum Corporation (NNPC) Signup and view all the answers

Who spoke at the final cut over ceremony of the corporation and the birth of NNPC Ltd at the NNPC towers in Abuja?

Minister of State, Petroleum Resources Timipre Sylva Signup and view all the answers

What was the timeline set within which full transfer of assets, interest, and liabilities must be completed after the PIA came into effect?

18 months Signup and view all the answers

Who is tasked with ensuring the revamping of the moribund refineries and the battle against oil theft?

Group Chief Executive Officer of NNPC Ltd, Malam Mele Kyari Signup and view all the answers

What are the prospects highlighted by the Group Chief Executive Officer of NNPC Ltd, Malam Mele Kyari?

Prospects in oil production Signup and view all the answers

What did Minister of State, Petroleum Resources Timipre Sylva describe as historic?

The transformation of NNPC into a company Signup and view all the answers

Who is responsible for crossing February 16, 2023 with a sense of fulfillment regarding the NNPC's transformation?

Minister of State, Petroleum Resources Timipre Sylva Signup and view all the answers

What is one task specifically mentioned for NNPC Ltd by Minister of State, Petroleum Resources Timipre Sylva?

Revamping moribund refineries Signup and view all the answers

What is Malam Mele Kyari's position in NNPC Ltd?

Group Chief Executive Officer Signup and view all the answers

What does the PIA put a long stop date on for completion within 18 months from its effective date?

Transfer of assets and liabilities Signup and view all the answers

According to the passage, what is the main focus of the Petroleum Industry Act 2021?

Creation of commercially driven national energy companies Signup and view all the answers

What does the Circular issued by the Head of the Civil Service of the Federation, dated 27 July 2009, explicitly state?

It requires career officers to retire if they wish to take up tenured appointments as Chief Executives of Government-Owned Companies Signup and view all the answers

What distinguishes the appointment of the CEO and CFO of NNPC Limited according to the provisions of the Petroleum Industry Act 2021?

Their previous rank in the old Corporation Signup and view all the answers

What is the primary reason for Mallam Mele Kyari and Mr. Umar Ajiya ending their employment with the Corporation?

Appointment by Mr. President as Group CEO and CFO of NNPC Limited Signup and view all the answers

What is NNPC Limited positioned to lead, according to Mele Kyari, Group CEO of NNPC Limited?

Africa's gradual transition to new energy by deepening natural gas production Signup and view all the answers

What commitment does NNPC Limited demonstrate, according to the passage?

Commitment to delivering greater value to Nigerians in compliance with laws and circulars Signup and view all the answers

What is the significance of ending their career appointments with the Corporation for Mallam Mele Kyari and Mr. Umar Ajiya?

They are entitled to their terminal benefits and are able to take up tenured appointments in NNPC Limited Signup and view all the answers

What action does the company plan to take in response to the misinformation and misrepresentation of facts published by Sahara Reporters?

Seek necessary legal steps to seek redress Signup and view all the answers

What is Timipre Sylva's viewpoint on the unveiling of NNPC Limited?

'The unveiling is a new dawn in the quest for growth and development of Nigerian Oil and Gas Industry' Signup and view all the answers

'NNPC compensation does not pay gratuity into billions' implies that:

'NNPC compensation pays gratuity responsibly and within reasonable limits' Signup and view all the answers

Study Notes

Upon completion of a project, the Project Manager and Supply Chain Manager review any surplus materials.
Materials can be returned to inventory or disposed of based on guidelines.
Materials proposed for disposal should be no longer fit for use, in excess of requirements, obsolete, or damaged.
All disposal requests must be executed in a controlled, detailed, and transparent manner.
The Disposal Request Form (DRF) is used to initiate a disposal process and track its progression.
For stock items, the asset holder identifies materials to be written off and disposed of, obtains approval from the asset owner, and forwards the approved DRF to the SCM MRP Controller.
For stock items, the SCM MRP Controller registers the DRF details, circulates it to other departments, arranges for the transfer of materials if they can be used elsewhere in NNPC, and forwards the DRF and all documentation to Finance & Accounts for financial adjustments.
For assets that cannot be used elsewhere in NNPC, the SCM MRP Controller forwards the DRF and all backing documentation to Finance & Accounts for the insertion of the book value and removal from the asset register.
The SCM MRP Controller reviews the DRF to ascertain if a potential hazard exists and makes appropriate recommendations based on the review.
Methods of disposal include sales to third party (open bidding), sales by auction, and destruction.
The approved DRF with all relevant documents is forwarded to the Assets Disposal Committee to commence the disposal process.
Nigerian National Petroleum Corporation (NNPC) officially relaunched as NNPC Limited, a wholly owned government entity, as mandated in Nigeria's Petroleum Industry Act (PIA).
NNPC Limited is expected to operate as a commercial entity and publish annual reports, audited accounts, and declare dividends to its shareholders, the Nigerian government.
The new NNPC Limited is no longer dependent on government support and is intended to have independence and raise its own funds.
The PIA grants the government ownership of all shares in NNPC Limited and control over the selection of its management team.
NNPC spends approximately N400bn monthly on petrol subsidy, which translates to N202 per litre of petrol.
NNPC Limited is required to pay its share of all fees, rents, royalties, profit oil shares, and taxes to the government.
The Minister of Petroleum and Finance have 18 months from the effective date of the PIA to determine and transfer the assets, interests, and liabilities of NNPC to NNPC Limited.
The PIA was signed into law in 2021, and some initial progress in implementing the PIA has been made, such as the formation of the Nigerian Upstream Petroleum Regulatory Commission and the appointment of NNPC Limited's chair and CEO.
Some upcoming requirements for PIA implementation include the creation and funding of host community development trusts and the opening of abandonment escrow accounts and preparation of abandonment plans.
The process for transferring NNPC's assets, interests, and liabilities to NNPC Limited remains unclear, although any pending proceedings will be enforced or continued against NNPC Limited.
NNPC careers of the Group Managing Director and Group Executive Director ended in accordance with the PIA and an appropriate government circular.

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Description

Learn about the process and framework for writing off and disposing of assets and stock in accordance with NNPC Stocking Policy and Asset Management and Accounting Principles. Understand the objectives, including removing non-moving items and disposing of moribund materials.

Stock Write-Off &amp; Disposal Process

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