Professional Documents
Culture Documents
ACKNOWLEDGEMENT
All the praises are for the almighty Allah, who bestowed me with his blessings, the ability and potential to complete my four weeks internship program. Words are very few to express enormous humble obligations to my affectionate Parents for their prayers and strong determination for enabling me to achieve this job. The inspiring guidance, remarkable suggestions, constant encouragement, keen interest, and friendly discussion throughout my internship period enabled me to complete this report efficiently. I offer my heartiest tribute and cordial gratitude to present my thanks to Mr. Asad (L/O section), Mr. Gulzar (L/O section), Mr. Sohail (Budget section),Mr. Iftikhar (budget section), Mr. Iqbal Batvia (Bid Bond Section),Mr. Amir (Treasury Function), Mr muneeruddin(Treasury function) who had been a source of constant support and inspiring guidance throughout my internship period. I am also thankful to Mr. Shuja who was source of guidance and his inspiration led me to learn and nourish my skills in different sections of the finance department.
TABLE OF CONTENTS
S.N O 1 2 3 4 5 5 6 7 8 TOPICS About the Company Finance department Areas of working Billing section Cash and Bank section Cost and Budget section OGRA Bid Bond section Recommendations PG.NO 3-5 6 7 8-10 11-13 14-16 16-17 18-20 21
SNAPSHOT OF SSGC
Sui Southern Gas Company Limited (SGGC) is engaged in the transmission and distribution of natural gas. The company is also engaged in the manufacturing and selling of gas meters. SGGC is a provider of high pressure transmission and low pressure distribution systems. The company owns and operates a network of high-pressure gas pipelines to supply gas. The gas is supplied to customers belonging to a franchise area covering more than 1,200 towns in the Sindh and southern Pakistan. The company principally operates in Pakistan. SSGC 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 357,129 million cubic feet gas was sold in 2006-2007 to over 1.9 million industrial, commercial and domestic consumers in these regions through a distribution network of over 29,832 km. The company also owns and operates the only gas meter manufacturing plant in the country, having an annual production capacity of over 550,150meters The company is managed by an autonomous board of directors for policy guidelines and overall control.
COMPANYS VISION
To be a model utility providing quality service by maintaining a high level of ethical and professional standards and through optimum use of resources
COMPANYS MISSION
To meet 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.
FINANCE DEPARTMENT
Finance is the lifeblood of any organization and same is the case with SSGCs finance department. Under the umbrella of finance Department we can find various sections which are linked to each other. 1) FINANCE Payroll Insurance Gas Sales Billing Bid bond Pre audit Provident fund 2) TREASURY Cash & Bank Imprest (Petty cash) Gas purchase Import Revenue collection 3) ACCOUNTS Inventory Cost Budget Fixed assets MIS
AREAS OF WORKING
The experience was more than what I had expected. The company provided me with an opportunity to work in areas of my keen interest and utmost importance. It was through these times that I got a multidimensional experience by working under four different sections of finance department. 1) Billing section(L/O and N.L/O) 2) Cost and Budget section 3) Bid Bond 4) Cash & Bank
BILLING SECTION
BACKGROUND
In order to keep in consideration the companys policy and ensure timely payments of all invoices the billing section of the company is formulated. To approve vouchers with in limit and to send reports to management on monthly basis on regarding details of invoices received and processed during the month and outstanding vouchers. The maintenance of the record of retention money deducted from invoices of suppliers and follow of long outstanding advances on monthly basis are all the functions performed by billing section of finance department.
Bill Paymen t
Local Order
LOCAL ORDER
Payments are made against tender and proper agreements in local order section.
When one is working under L/O and N.L/O section so he/she can have a know how of the following documents as these are required in both the sections. 1) Bank payment voucher 2) Checklist 3) Local purchase order 4) Cash memo 5) Comparative statement 6) Work order 7) Income tax invoice 8) Evaluation report 9) Approval 10) Receiving statement In short, the bill payment section of finance department is required to process the bills of service, contracts, utilities, medical, supplies, and other non local order bills received from various departments including ditching contractors, road cutting charges, civil works etc. The section also processes the medical bills of headquarters. The section is responsible to ensure that all transactions are with in the authorized limits and adequately approved. Similarly the payments are made only for the authorized acquisition of the services, contracts, works orders etc and approved by competent authorities.
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BANK SECTION
All payments made through cheques, pay orders and demand drafts are a part of bank section. SSGC has a number of disbursement accounts and the bank account is selected according to the payment amount required. Oracle AP &, AR modules are used to keeps an up to date record of all payments and receipts. The department also keeps a check of each bank balance so that no account would have a negative balance. In case some account has less than the minimum amount, funds are transferred from the ones that have excess funds means the accounts are reappropriated. An indispensable role is played in the maintenance of strong room, disbursement bank accounts reconciliation, depositing of cheques, pay orders in SSGC A/Cs and, orderings Banks stationeries of bank rolls, cheque books. It facilitates internal and external audits and keeps a record of all bank receipts, bank payments and returned cheques. It generates MIS reports when required and orders cash from bank for daily uses. An effective management of fund is done under the supervision of this department.
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cheques are disbursed to the concerned parties through courier or the party sometimes send his representatives for collection.
BUDGET
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Plan of action that forecasts future transactions, activities and events financial and non financial. The making of budget allows an organization to establish the following: 1) The minimum desired level of revenue, or target level of revenues. 2) The corresponding spending for the creation of the desired revenue. There are 2 kinds of budgets prepared in SSGC. 1) Revenue budget 2) Capital budget Revenue Budget: Expenditure on repair and maintenance of fixed assets or restore its original assessed standard of performance is normal revenue expenditure and should not become part of capital budget. Capital Budget: Capital expenditures are those that result in creation and betterment in the life or productivity of assets, the future economic benefit of such assets r expected to continue 4 more than one fiscal year.
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SGMS of different divisional heads will be called to Karachi HO and they will cut and remove items in budget which are not required only in their area. After this allocation of function code to budget takes place. The problem arises when some departments spend their budgets before the specified period. In order to solve this issue, the department sends the request for additional budget or reappropriation. The cost and Budget section as suitable a lot additional budget or re appropriate budget. Then the proposed budget is made department wise, company wise and account wise.
through interdepartmental note along with the copy of their budget. Keeping aside all these issues, the finance department has to follow the budget as proposed by BOD and then the budget is released in four quarters but the BOD has to follow OGRA requirements and without their approval they can not approve the budget.
OGRA
OGRA has been set up under the oil and gas regulatory authority ordinance dated 28th march 2002 to foster competition, increase private investment and ownership in the midstream and downstream petroleum industry, protect the public interest while respecting individual rights and provide effective and efficient regulations, OGRA works under ministry of petroleum ,as OGRA gives advises to ministry of petroleum for setting well head and sale prices for end consumers and producers of natural gas and issue it when approved from ministry.
FUNCTIONS OF OGRA
1) According to the rules, grant licenses, modify, amend, extend, suspend, review, cancel and reissue revolve or terminate any license 2) Prescribe a uniform form of accounting practices by licensee 3) Promote and observe the practices for efficiency 4) Promote competition 5) Enforce compliance by licensee
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6) Resolve complains 7) Prescribe fines if rules are not obeyed 8) Protect interest of stake holders. 9) Administer or establish price for those categories of products for which federal government establishes prices. 10) In consultation with federal government determine a price for each licensee a reasonable rate which may be earned by such license. 11) Oversee capital expenditure budget made by licensee of natural gas. 12) Determine well head gas prices for the producers of natural gas. 13) Impose excise duty, taxes, and other forms of charges. 14) Licensee for natural gas means licensee for transmission, distribution and sale of natural gas to retail consumers. 15) To check and ensure that the pressures in transmission and distribution pipelines are according to required pressure that is less than 300psig 16) OGRA is an independent authority; it can sue and be sued, acquire and hold. 17) Responsible for issuing sale price and minimum charges for SSGCL and SNGPL to charge from their customers.
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Releasing the bid bond to the supplier after completion of the project
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are keep intact but if the bid bond amount is in the form of bank guarantee so no matter what the amount is but it is kept save and not encashed. Release of bid bond On the basis of lowest rates and past performance three lowest bidders are selected and among them only one is selected later. After the selection,all other bid bonds are released. Performance bond The amount of money paid by the supplier who had been selected as a successful bidder. This amount is retained by the company as a security deposit until the work is completed. It can be in the shape of either bank guarantee or pay order. Retaining of performance bond The successful selected bidder is bound to pay 10% of total amount of tender in the form of performance bond. This is withheld by the company till the completion of work. Release of performance bond As the work is completed by the supplier, the company inspects both the quantity and quality of work done and
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when
the
company
is
fully
satisfied
with
the
work,
AN
IMPORTANT
CONSIDERATION
IF
THE
RECOMMENDATIONS
On the basis of my analysis and as recommended by Mr. Shuja I would like to share some of my suggestion, which if looked upon seriously can improve the functioning, operations and promote sense of belongingness for the company employees.
1)
Internees at SSGC are not hired on the basis of their merit rather on their strong references or some political background, which is an open discrimination.
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since I found absence of this element while interacting among different people of the organization and the core reason I found behind this was the factor that people at SSGC are aware of the fact hat no matter how hard they try or how loyal to the company they are, but until and unless they have a strong reference they can not be promoted.
3)
The young employees do not foresee a bright future in this organization therefore they have a feeling of disowning this organization because this company do not promises career growth on the basis of performance and hard work.
4) 5)
Absence of a separate prayer room for girls. Internees at SSGC should be rotated on weekly basis in a systematic way so that they can find a proper linkage between the sections they are sent form time to time.
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