CHAPTER 3 MATERIAL RECEIPTS AND EXPENDITURES The term receipt refers to material and services received for stock and direct turnover (DTO). The term expenditure refers to transactions involving either an issue, transfer, cash sale, or survey of material. This chapter contains information about procedures involving material receipts and expenditures. The two most important management functions of any supply department organization are material receipt and expenditure. These functions are part of the daily routine operations in the supply environment. The prompt and accurate processing of material receipts and expenditures greatly contributes to effective supply operations. A properly planned layout of the work area and a smooth flow of documents and material make an effective receiving operation. Material issue is the most common method used for expending items of supply stock. In general, the issue transaction for a consumable item will result in an expenditure to an end-use fund. These funds are then used to requisition replacement items for stock. However, the procedures for expending aviation depot level repairable (AVDLR) items are different. When processing AVDLR, the expenditure will be processed only when the turn-in is beyond the repair capability of the supporting aviation maintenance activity. In this case, the retrograde is shipped off and the stock replenishment requisition is submitted to the supply source. As a senior AK, you must know the procedures for processing receipts and expenditures because you will perform supervisory duties, either directly or indirectly, in all phases of these tasks. To properly perform these duties, both ashore and afloat, you should be familiar with your organization and its duties. You must also know the following information: receiving operations, types of receipt, methods of delivery, format of various forms used in receipts and expenditures, 3-1 l l l filing system, receipt preparation, inspection, and verification, and disposition of material and documents. The procedures for processing receipts and expenditures vary depending upon the systems or labor- saving devices used. The availability of computer . systems such as the Shipboard Uniform Automated Data Processing System-Real Time (SUADPS-RT) saves processing time. The aviation community in the Navy uses the Naval Aviation Logistics Command Management Information System (NALCOMIS). The Naval Integrated Storage, Tracking, and Retrieval Systems (NISTARS) and Integrated Barcode System (IBS) are used for receipt processing. Although automated systems are being used, there are times when transactions must be processed manually. You must know the contingency procedures used for processing receipts and expenditures manually to continue operating and prevent backlog. MATERIAL RECEIPT Material receipt is the gaining of possession of an item of Navy property through acceptance of physical custody. Receiving activities must have full control of the material after receipt and before it is forwarded to its ultimate destination. It is estimated that losses that occur during this cycle range from 40 to 70 percent of total material losses in the supply system. The control procedures must include the following processes: l l l Identification of quantity received Source and date of receipt The unit to which physical custody was transferred at the completion of the Receiving process and the date on which the received material was released Material may be received from several transportation sources such as the U.S. Postal Service, commercial or government air freight, commercial trucking firms, the United Parcel Service (UPS), vendor deliveries, commercial or government water freight,