SUPPLY CHAIN MANAGEMENT A GUIDE FOR ... - National …

National treasury Republic of South Africa February 2004 _____ SUPPLY CHAIN MANAGEMENT A GUIDE FOR ACCOUNTING OFFICERS / AUTHORITIES 2 PREFACE This GUIDE sets out the philosophy behind the adoption of an integrated SUPPLY CHAIN MANAGEMENT (SCM) function across government and will assist stakeholders to understand the responsibilities this implies. This document explains the impact of the changes for accounting officers/authorities at each step of the SCM cycle. While the Constitution states that procurement practices must be fair, equitable, transparent, competitive and cost-effective, the present position is far from the ideal, for example: procurement and provisioning procedures are rule driven, and value for money is almost always equated to the lowest price tendered - the emphasis is on monitoring inputs; procurement and provisioning activities are not linked to budgetary planning; asset MANAGEMENT is limited to control of inventory, rather than on ensuring a satisfactory return to the community for the funds invested; bid documentation are not uniform, causing uncertainty to bidders and practitioners; the Preferential

detailed Treasury Instructions was an illusion, and in fact accountability was undermined, as departments were required to obtain ‘approval’ from Treasury for example, to ‘write-off’ minor ... Risk management acknowledges that all the activities of an institution involve some element of risk. Management

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