SOP Library
SOP NO:
TS-ES19
(List of Exhibits/Attachments)
Mission
:
Technical Support Services
Area:
Industry Services (BR)
Title:
SOP on Post Production Incentive for Services Offered by NFA (PPISO)
Date Approved/Issued:
06/07/2004
Date Effective:
06/07/2004
Digest:
I. TERMS OF REFERENCE
A. Rationale
B. Objective
C. Scope
D. Basis
II. IMPLEMENTING GUIDELINES
A. Statement of Policies
1)
Granting of the Post Production Incentive for Services Offered (
P
PISO) by NFA
a) The
P
PISO shall be granted every time FO’s sell their palay to NFA under its regular procurement program. It shall be computed at P1.00 per equivalent net weight of one kilogram of palay delivered to NFA rounded up to the nearest peso.
b) The
P
PISO shall be applied to FO deliveries which are in accordance with the approved NFA standard grains specification for palay. Only palay deliveries with not more than 18% moisture content level shall be accepted under the program.
c) Only FO’s which have legal juridical personalities, and are registered as active and/or operational with the Cooperative Development Authority (CDA) or Securities and Exchange Commission (SEC) shall be granted PPISO. A FO is considered active and/or operational if its Certificate of Good Standing issued by the CDA or renewed Certificate of Registration issued by the SEC is valid for the current year that palay is sold to NFA.
d) The granting of the
P
PISO shall be implemented
only
during the period covering the months of September to February, which is
normally
the main harvest season.
e) This incentive is granted on top of the already existing CDIF granted to qualified and accredited FO’s/farmer members.
f) Palay deliveries of the FO under the Palay Negotiable Warehouse Receipt Program (PNWRP) are not entitled to the granting of the PPISO unless and until these stocks are sold to the NFA on the period covering the months of September to February by the original owner.
g) Palay deliveries of the FO under the FOBB Program are not entitled to the granting of the PPISO unless and until the FO did not exercise its right to buy back the same within the prescribed period.
2. Availment of the
P
PISO
a) The
P
PISO shall be accumulated as credits to the FO’s. These credits can be availed of only when the FO’s utilize the Post Production Facilities of the NFA
b) Instead of paying NFA for the use of its PPF facilities, charges shall be made against the FO’s
P
PISO account and shall be applied as payment for the services NFA extended to the FO through the use of its PPF.
c) In cases where the accumulated
P
PISO credits are not enough to meet the PPF utilization requirements of the FO, the remaining balance shall be paid in cash.
d) PPISO credits of an FO should under no circumstances be used or borrowed by another FO which does not have enough PPISO credits to cover their PPF utilization requirements.
e) Availment of the
P
PISO shall be supported by an FO board resolution which includes the designation of a member representative authorized to transact with NFA.
3) Utilization of NFA Post Production Facilities (PPFs)
a) The NFA Post Production Facilities (PPFs) covered under this program are the following:
all types of driers, threshers, corn shellers, rice mills, corn mills, packaging machine, truckscale
NFA trucks and warehouses, when available, may also be availed of under the program.
b) Accredited FO’s can avail of the NFA PPFs through the custom hire scheme.
c) The facility shall be operated by the NFA PPF Operator / Mechanical Plant Operator (MPO) for processing of stocks, (ricemill, drier, packaging machine), NFA designated scaleman
(truckscale), and NFA truck driver (truck).
d) Payment shall be based on pre-computed service fees on a per bag input or output basis which ever is applicable, as follows:
Facility Service Rate basis
Driers per bag input
Ricemill per bag input or output
Threshers per bag input
Corn shellers per bag input
Trucks per ton/km
Packaging Machine per bag input or output
Truckscale per type of truck
Warehouse no. of bags stored; warehouse space used; and/or no. of days storage
Incidental expenses such as handling expenses related to the processing of the stocks shall be imputed to the cost of service fee for the use of the PPFs.
e) The stocks for processing shall be brought by the FO to the NFA Provincial Office compound/warehouse on the he scheduled date ooff service.
f) The NFA shall not be held accountable for the FO’s stocks during the operation/processing, since the FO shall assign their own representative to watch over the stocks being processed at all times.
g) The FO shall execute a Milling Contract and Hauling Agreement if they will avail of NFA’s ricemill and NFA truck respectively.
B. Documentation System
1. Application for
P
PISO Availment / PPF Utilization - (APL-
P
PISO) this shall be filled up by the FO representative intending to avail of the FO’s accumulated
P
PISO credits. For control and reference purposes this shall be numbered as follows: APL-
P
PISO-04-03-001 (Year-Month-Number). (
Exhibit 1
).
2. The Application shall include an undertaking by the FO to assume responsibility and accountability of its stocks while under processing by the NFA PPF Operator/MPO from the time the stocks were delivered up to the time these are ready for pick-up.
3. Authority to Use - PPF - (ATU-PPF-
P
PISO) - This form prepared by Operations Section and approved by the manager, authorizes the MPO/PPF Operator,
designated scaleman, and truck driver to utilize the PPF as reflected in the application for PPISO availment by the FO. (
Exhibit 2
)
4. Transaction Slips
4.1 Custom Milling Slip (CMS) - This shall document what type of ricemill to be used, its scheduled date of utilization, the delivery of palay input and MTS, receipt of the same by NFA MPO, and the issuance and /or acknowledgment of the receipt of the rice recovered and by-products by the FO representative. (
Exhibit 3
)
4.2 Custom Drying Slip (CDS)- This shall document what type of drier to be used, its scheduled date of utilization, the delivery of palay input and MTS, receipt of NFA MPO of the same; and issuance and /or acknowledgment of the receipt of the stocks processed or dried palay and MTS by the FO representative
(Exhibit 4
)
4.3. Custom Packing Slip (CPS) - This shall document the type of packaging machine to be used, its scheduled date of utilization, the delivery of rice or sugar input for repacking, receipt of NFA MPO for these stocks; and issuance and /or acknowledgment of the receipt of the repacked rice or sugar by the FO representative (
Exhibit 5
).
4.4. Custom Hauling Slip (CHS) - This shall document the type of truck to be used, its scheduled date of utilization, the origin and destination of the stocks to be hauled, receipt of the driver of the stocks to be hauled at point of origin, and final acceptance of the recipient of the stocks hauled at point of destination (
Exhibit 6
)
4.5 Warehouse Space Utilization Slip (WSUS) - This shall document the name of warehouse, the area/space to be utilized for storing of the FO’s stocks, period of storage, and the quantity in bags of stocks to be stored. (
Exhibit 7
)
4.6 Custom Weighing Slip (CWS) - This shall document the brand and type of truckscale, utilization date and time, the gross weight, tare weight, and load weight, truck plate number and type of vehicle. (
Exhibit 8
)
5. Authority to Accept Payment - This document prepared by the MPO/PPF Operator for Custom milling, drying, packaging, etc. and by the Operations Section for warehouse space rental, hauling, and truckscale use, based on application (APL-PPISO) authorizes the Cashier to accept payment of service fee in excess of the FO’s accumulated PPISO credits balance.
(Exhibit 9
)
6. Contract of Milling - This shall be executed by the FO and the NFA if the FO will avail the services of an NFA ricemill. (
Annex 1)
7. Hauling Agreement - This shall be executed by the FO and NFA if the FO will avail of hauling services using NFA trucks and driven by an NFA driver. (
Annex 2
)
C
. Reporting and Monitoring System
1. Monthly PPISO Granted and Availment Report (MPGAR) - The report shall summarize the total
P
PISO granted and availed of by the FO for the month on a per FO basis. This shall be prepared by EBPDS/PMDO for submission to RO to be consolidated and for final submission to EXD, copy furnished PO Finance Section. (
Exhibit 10
)
2. The EBDPS/PMDO shall monitor the granting of
P
PISO and its availment by maintaining an index card per FO. (
Exhibit 11
). A monthly reconciliation of these balances shall be made with the records of the Finance Section.
3. The Finance Section shall keep track of the
P
PISO trust liability account on a per FO basis by maintaining a separate ledger card for this. It shall monitor and record all charges and credits to this account. The balances in the ledger card should tally with the balances in the index card maintained by EBPDS/PMDO. (
Exhibit 12
)
4. The PPF Operator shall include in the PPF Monthly Utilization Report submitted to TSD the PPF used under this program.
D. Accounting Treatment
1) The
P
PISO shall be treated as a trust liability in the NFA books. This means that the incentive shall be held in trust by the NFA in favor of the FO. Said amount shall be charged only against the FO once the FO utilizes PPF of the NFA.
2) Accounting entries to record the transactions:
a) To record and/or set up the
P
PISO account based on the replenishment of the SDO
DR: Inventory Cost-
P
PISO xxx
101-C-22-803
CR Trust Liabilities-
P
PISO xxx
8-84-900.05
P
PISO
b) To record charging of
P
PISO to Inventory Account
DR Inventory IFS - Appropriate Account xxx
8-72-360.01
CR Inventory Cost -
P
PISO xxx
C
c) To record availment of
P
PISO based on the transaction slips:
DR: Trust Liabilities -
P
PISO xxx
8-84-900.05
P
PISO
CR: Miscellaneous Income-Facility Assistance xxx
1-57-200 Appropriate FS SL Code
d) To record cash payment for the balance of NFA-PPF utilization where
P
PISO credits are not enough to cover the service fee in utilizing the facilities.
DR: Cash -Collecting Officer-Regular xxx
8-70-400.01
CR: Miscellaneous Income-Facility Assistance xxx 1-57-200 Appropriate FS-SL Code
III RESPONSIBILITIES
A.) Granting of the
P
PISO
Farmer member/FO - delivers and sells palay to NFA Buying Station
SDO - Prepares Purchase Receipt upon purchase from farmer/FO’s and indicates the amount of the
P
PISO. Prepares and
numbers
his Abstract of Purchases and furnishes copy to EBDPS. Replenishes his Cash Advance re procurement of cereals.
Finance Section -Processes replenishment of the SDO; Prepares / updates ledger card of FO-
P
PISO based on the Abstract of Purchases. At end of the month, prepares journal voucher to take up the trust liability account. Indicates JV No. As reference on the ledger card.
EBDPS - Based on the abstract of purchases of the SDO, prepares / updates index card for each FO granted with
P
PISO.
B) Availment of the
P
PISO
FO Representative
1) Submits Farmer’s Organization’s Board Resolution regarding the availment of the PPISO and the assignment of FO representative to transact business with NFA.
2) Executes pro-forma contract for Milling with NFA if application is for use of ricemill
3) Executes pro-forma hauling agreement with NFA if application is for use of NFA trucking facility.
EBDPS/MDO
1) Issues and processes the Application for Availment of the
P
PISO
2) Issues Pro-forma Contract (Annex 1) if application is for rice milling.
3) Issues Pro-forma Hauling Agreement (Annex 2) if application is for trucking facility.
SGOO-Operations Section
1) Schedules date of utilization of the PPF requested by the FO
2) Prepares Authority to Use PPF or ATU-PPF(
P
PISO)
for all PPFs, including truck but excluding warehouse
PM
1) Approves application form for
P
PISO availment
2) Signs contract for milling with FO
3) Signs hauling agreement with FO
4) Approves ATU-PPF (PPISO)
C) Utilization of NFA PPF - Charging of PPISO Credits
FO
1) Brings stocks for processing to NFA PO, Warehouse, or Buying Station on scheduled date of processing.
2) Pays in cash the balance if PPISO credits are not enough to cover payment for service fee for use of PPF.
3) Assigns representative to watch over their stocks while being processed, at all times.
4) Receives/accepts stocks processed including by products, as in the case of milling, and delivered stocks as in the case of hauling.
EBDPS/MDO
1) Updates index card of FO based on the transaction slips
2) Prepares Monthly Report of PPISO granted. and availed.
SGOO-Operations Section
1) Prepares Custom Hauling Slip (CHS), Warehouse Space Utilization Slip (WSUS) and Custom Weighing Slip
(
CWS) for truck, warehouse, and truckscale needed by the FO.
In the case of warehouse space rental, the WSUS may serve as the authority to use (ATU) the warehouse, or part thereof.
2) Prepares AAP for cash payment if PPISO credits are not enough to cover service fee for utilization of NFA trucking facility, warehouse, and truckscale
.
3) Instructs NFA truck driver to report to FO rep and gives copy of CHS for signature of driver and FO representative and/or recipient of stocks hauled.
PM
1) Approves transactions slips
SQAO
1) Classifies palay stocks of the FO intended for milling.
MPO/PPF Operator
1) Prepares Custom Milling Slip (CMS), Custom Drying Slip (CDS), Custom Packing Slip (CPS) for PPF needed by FO for milling, drying, and packing/repacking respectively.
2) Prepares AAP for cash payment if
P
PISO credits are not enough to cover service fee for utilization of NFA PPF (ricemill, drier, packaging machine)
3) Receives stocks of FO for processing.
4) Processes stocks of FO upon approval of CMS, CDS, or CPS, as the case maybe.
5) Releases stocks to FO representative after accomplishment of the transaction
6) Prepares monthly report of PPF utilization to include PPISO availment of FO’s
NFA Truck Driver
1) Drives truck and reports to FO rep for stocks to be hauled.
2) Signs on CHS for receipt of stocks to be delivered
3) Delivers FO’s stocks from point of origin to point of destination.
Finance Section
1.) Based on transaction slips, prepares journal voucher and updates the ledger card of the FO
Cashier/RDO
1) Accepts additional cash payment from FO’s with insufficient
P
PISO credits to cover the service fee for utilizing NFA PPFs
.
III. RESPONSIBILITIES
IV. FLOW CHART
Top Page
EXHIBITS
Notice for Inactive PPISO (Exhibit 1)
Notice for PPISO Forfeiture (Exhibit 2)
Forfeited PPISO and PPISO Nearing Forfeiture (Exhibit 3)