[Link].

Area Sub-Process Process Objective

1 Outbound Planning To ensure that adequate resources

Logistics is available on the basis of
2 Planned Sales order.

5
6 MIS To ensure that timely MIS is
prepared and reported to the
management

8 Recruitment of Truck To ensure that Physcially fit and

drivers reliable candidates are recruited
9 for driving of trucks

10 Selection process of To ensure that the company shall

transporters follow the process of selection of
11 transporter as per SOP if any

12

13

14 Agreements with To ensure that relevant clauses

Transporters are entered into the
contract/agreement with different
15 transporters; Also, ensure that
Hiring of trucks will be made only
16 if owned trucks are inadequate to
serve the actual dispatch
17

18

19 Performance To ensure that evaluation of

Evaluation of transporter's performance is
transporters made periodically
20 Non-utilisation/ To ensure that Trucks are fully
Under-utilisation of utilised as per its capacity
21 trucks

22

23 Idle Employed drivers To ensure that drivers employed

24 on Payroll of company for the purpose of running of
trucks is not sit idle
25 Dispatch of goods To ensure that the dispatch is as
per the sales order
26

27

28 Tracking over trucks To ensure the timely dispatch of

goods and also the security of
goods
29
30 Expenses related to To ensure that the adequate
31 the transport expenses are incurred over trucks
32
33

34

35 Accounting of To ensure that adequate authority

36 transporter bills approves the bills of tranporters

37

38

39 Transit Insurance To ensure that Stock in Transit are

adequately insured and adequacy
40 on insurance cover reviewed
periodically.
41 Inbound Receipt of goods To ensure that goods are received
Logistics alongwith sufficient supportings.
Further, minimising cost of
inbound logistics

42

43
What/How to check? Requisite Documents/SAP
T-code
Check the Planned dispatch report on Dispatch Plan Report,
sample basis and compared with the Budgeted vs actual Sales Plan
actual Dispatched orders.

Obtain MIS on Sample basis MIS

Obtain a list of drivers recruited during List of drivers recruited,

the audit period, identify that whether requisite documents, viz,
health checkup is made or not before the Experience certificate,
recruitment, experience certificate is Driving license, Health check
obtained, observe the penalty/damage up
caused
Obtain atoSOP,
the trucks during
if any for a particular
the purpose of SOP, if any, Quoatations,
selection of transporter Approval as per DOA

Obtain a list of Owned/Hired trucks by Copy of Contracts/Agreement

the company, Compare the hiring charges with the tranporters
with different transporters, Prepare a
cost and benefit analysis of transporters

Check the SOP for the Performance SOP

evaluation, if any
Obtain a list of trucks owned/hired by List of trucks owned/hired
the company during the Audit period alongwith their capacity ;
Schedule of trucks alloted as
per the dispatch plan

Obtain a list of driver, helpers recurited List of drivers/helpers

on payroll of the company recruited

Obtain on Sample basis copy of Sales Sales order, dispatch dump, if

order and ensure that the dispatch is as any
per the terms & conditions of the the
same

Determine the process of tracking system

of trucks used for the purpose of
transport

Check the expenses ledger related to Expenses ledger, viz; Diesel

trucks, transport expenses, toll charges,
penalty, freight charges etc

Check the Invoices of transporters Invoices from transporter;

Contract/agreement with the
transporter

Check the Insurance Policy Insurance Policy

Check that the goods are received as per PO, Invoices, Weighment slip
the PO
Checklist Status Sample Size
(Y/N/NA)
Check the variance in Planned vs Actual dispatch orders
prepared by the Logistics department.
Check the variance in Dispatch Plan report prepared by the
Production deptt vs Logistics deptt.
Check the un-utilised resources (i.e. trucks,drivers) due to the
variances in Planned vs Actual Sales order
Check the reasons for non-dispatch of sales order, if any
whether was due to inadequacy of resouces
(i.e. Non-availability of trucks for the purpose of dispatch)
Check that there is a system of Review of Pending orders
Check that the periodic MIS with specific deadlines is defined
for pending despatches, damaged stocks in transit, stock in
transit , etc. and is submitted to the appropriate authority.

Check that the management is aware about the reasons for

delay in despatch of material is not despatched due to different
reasons viz, in case of despatch to outside state, Road Permits
was not available with the company. further, ensure that the
Access to generate online RPs is restricted to authorised
personnel.
Check whether the requisite documents was obtained or not
before making recruitment of driver.
Check that whether the recuited driver have any relation with
the employees of the company; any undue favour is provided to
the driver or not.
Check that the transporter is selected as per the process laid
down in SOP, if available
Check that the adequate quotations are received before the
selection of any transporter, ensure a comaprative chart is
prepared of freight charged by different transporters and also
ensure that cost effective transporter is hired
Check that the performance evaluation is prepared in case of
old transporters before renewing agrrement/contract with
them
Check that the appropriate authority has made a selection of
transporter
Check that relevant clauses viz, penalty clause, payment clause,
detention clause, law & adjudication, transit losses etc is a part
of a contract/agreement
Check the link (i.e. any relationship) with of transporter with
the employee of the company.
Check and identify the reasons of variances in transport
charges(i.e freight charges) offered by the transporters.
Check the selection process of tranporter and also check that
the appropriate authority has signed the Contract/agreement
of tranporters.
Prepare a cost and benefit analysis of a particular transporter.

Check that whether performace evaluation process is carried

out or not as per SOP
Check the Non-utilisation of trucks and obatin the reasons for
the same.
Identify the opportunity cost of Hired/owned Non-utilised
trucks
Identify whether the owned/hired trucks is adequately utilised
or not.
Check that the adequate drivers/helpers are recruited
Check the Idle Employed drivers/helpers on payroll of the
company
Check that dispatch of goods within the time limit prescribed in
the Sales order
Check that no dispatch is made without the generation of a
valid E-way bill
Identify the cases of delay in despatch as compared to the
period mentioned in the Sales order
Check that GPRS system is enabled, if not then determine how
the company is able to make control over trucks sent for
dispatch pupose.
Check that the confirmation from receiptent is obtained
Check the hike in prices is as per the market condition or not
Comparative analysis of expenses vs revenue
Check whether the penalty charges are recovered or not
Check that expenses incurred on behalf of hired transporter is
recovered from them
Check that no expenses is incurred by the company which is to
be incurred by the hired transporter as per the
contract/agreement entered with them
Check that bills passed as per DOA

Check that the tranport charges charged is as per the contract

Check the required supportings are available with the
transporter bills
Check that the 100% availability of Proof of Deliveries (POD) is
ensured before processing transporters invoices for payment.

Check whether the Insurance Policy covers the Stock in transit

Check whether the value of Stock in transit exceeds the
amount insured under the insurance Policy
Check that weighment of goods purchased is made under the
premises of the company and if there is a material variance in
the weight shown while the actual weighment vs the weight
shown on the copy of Invoice received from the vendors, then
report it to the Stores
Ensure that weighment machines have caliberation certficate
and it was working according to the same
Compute TAT in case of transport charges is paid by the
company on account of purchases. If TAT is high they will
charge high price because there truck will idle.(TAT is is the
difference between arrival time of the truck at company and
departure time from the company after loading of material and
invoice procedure)