Chapter 2 – Fiscal Management

22030.4 Goal and Objectives

• The program goal is to have quality materials available where they are needed, in adequate quantities, at a minimum cost to the Department.

• The Department’s program objectives include the following:

  • Support

    • Support operations with an uninterrupted flow of material without overstocking.

      • Maintain accurate stock records with fiscal accountability.

      • Set stock levels after stock records are maintained and reset levels at least annually thereafter.

  • Improve

    • Improve service at the lowest feasible cost.

      • Chart the target and the actual inventory level of the total inventory and by material commodity group and class.

      • Chart and measure the overall service level and set goals.

  • Develop

    • Develop reliable systems which shall help prevent stock outages and provide continued program performance.

      • Determine the percentage of stock outages caused by late deliveries or inaccurate forecasts.

  • Set

    • Set an inventory turn rate goal for each commodity group.

      • Measure the annual inventory turn rate by group.

  • Maintain

    • Maintain an accurate and up-to-date book inventory.

      • Compare physical inventory counts with book inventory counts.

      • Determine the level of accuracy in posting transactions.

      • Identify the data lag by comparing the date of the inventory transaction with the date the transaction is posted.

  • Keep

    • Keep the inventory investment and the inventory losses because of deterioration and obsolescence of stock items at a minimum.

      • Determine whether or not stock is being rotated.

      • Determine the amount and value of items declared obsolete or defective.

      • Identify all items with declining demand histories before they become obsolete.

  • Buy

    • Buy competitively.

      • Secure bids and quotes from vendors to determine lowest cost.

      • Develop lists of vendors and encourage vendors to offer discounts for prompt payment of invoices.

  • Encourage

    • Encourage purchases from small, minority, or women-owned businesses.

      • Establish goals and facilitate the participation of 15 percent minority and 5 percent women owned businesses in procurement service and public works contracts.

      • Provide that the contracts let by the Department for the construction, erection, alteration, repair, or improvement of a state prison facility and for services, maintenance, and supplies be awarded to at least 15 percent minority businesses and 5 percent women-owned businesses.

      • Determine the percentage of expenditures for annual purchases awarded to small, minority, or women-owned businesses.