Sui Southern Gas Company Limited

Internship Report
Finance Department

AWAIS MAHMOOD UNIVERSITY OF SINDH JAMSHORO

Prepared By: AWAIS MAHMOOD

INTERNSHIP REPORT

2008

Sui Southern Gas Company Limited

Dedication

These Efforts are dedicated to My Parents & My Teachers

Whose kind co-operation, Blessing, Help and Inspiration gave impetus To complete this work

Prepared By: AWAIS MAHMOOD

INTERNSHIP REPORT

2008

Sui Southern Gas Company Limited

ACKNOWLEDGEMENT
I am grateful to “Al mighty God” who gave me all the strength, courage preservation and patience to finish my Six weeks of Internship Program at SSGC and in achieving my task fruitfully. Then I would like to extend my gratitude to SSGC HR management especially to Madam Shazia Siddiqui for giving me an opportunity to enrich and upgrade my experience and skills. It was quite a great experience for me to work with diversified and literati people and helped me to understand cross-cultural-differences. I would like to take this opportunity to formally thank Mr. Gulab Baloch (Deputy Chief Manger-Fixed Asset), Mr. Saleem Durani (Manager -Store), MR. Anees Hussain (Chief Manager- Local Order Section) and Mr. Wajeeh (Deputy Chief Manager- GDS) for providing their immense support and unwavering guidance during conduct and completion of this internship report on SSGC and it became possible for me to complete this work within short time. I would specially like to thank Ms. Aliya peerzada (Deputy ManagerGDS) and Mr. Waseem (Deputy Manager- Insurance Section) for their constant support and guidance and for solving all my queries during the course of my internship. It was because of their kind efforts that I have been able to explore the practical world in a very professional manner

Prepared By: AWAIS MAHMOOD

INTERNSHIP REPORT

2008

Sui Southern Gas Company Limited I NTRODUCTION .

SSGC at a Glance: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited INTRODUCTION TO SSGC Introduction: Sui Southern Gas Company (SSGC) is Pakistan's leading integrated gas Company.040 million (industrial 3. The Company has achieved another milestone at the meter plant. having an annual production capacity of over 550. The Company is managed by an autonomous Board of Directors for policy guidelines and overall control. The distribution activities covering over 1200 towns in the Sindh and Baluchistan are organized through its regional offices.150 meters. industrial and bulk customers in Sindh and Baluchistan.014. 10 billion of which Rs 6. An average of about 378.448. The company also owns and operates the only gas meter manufacturing plant in the country. The Government owns the majority of the shares which is presently over 70%.7117 billion is issued and fully paid up. SSGC's Board comprises of 14 members. The Company has an authorized capital of Rs. The Managing Director/Chief Executive is nominee of GOP and has been delegated with such powers by the Board of Directors as are necessary to effective conduct the business of the company. SSGCL transmission system extends from Sui in Baluchistan to Karachi in Sindh comprising over 3. Presently. SSGC is a model utility company responsible for supplying uninterrupted natural gas to domestic.200 KM of high pressure pipeline ranging from 12”.192 and domestic 2. commercial.827 consumers) in these regions through a distribution network of over 31. commercial 22. The company is engaged in the business of transmission and distribution of natural gas besides construction of high pressure transmission and low pressure distribution systems.468 million cubic feet (MMCF) gas was sold in 2007-08 to over 2. It has obtained ISO 9001: 2000 certifications.24" in diameter.877 Km.

in 1989. Sari Hundi. serving the entire Southern region of the country. Southern Gas Company Limited and Sui Gas Transmission Company Limited were merged to form the Sui Southern Gas Company Limited. namely Sui Gas Transmission Company Limited. Two distribution companies were established in 1955 and were responsible for the distribution of gas to consumers in Karachi and in other towns along the route of the transmission pipeline between Sui and Karachi. these two distribution companies were merged to form Southern Gas Company Limited and later. Daru and Kadanwari gas fields  Distribution of Gas in Sindh and Baluchistan provinces  Manufacturing and sale of gas meters  Construction contracts of laying pipelines SSGC’s VISION Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Karachi Gas Company Limited and Indus Gas Company Limited. Core Business: The main activity of the company is transmission and distribution of gas in Sindh and Baluchistan. Secondary Activities: The company is also engaged in certain activities related to the gas business including manufacturing and sale of gas meters and construction contracts for laying of pipelines. half a century of professionalism and progress has made the SSGC one of the largest integrated natural gas transmission and distribution companies in Pakistan. Mari. In 1985. Sui Gas Transmission Company Limited was formed in 1954 with the primary responsibility of gas purification at the Sui field in Baluchistan and its transmission to the consumption centers at Karachi. comprising the provinces of Sindh and Baluchistan. Today. 1989 following a series of mergers of three pioneering companies. KandhKot. Thus the core functions of SSGC can be elaborated as under  Purification of Natural gas from Sui Fields  Transmission of Natural Gas from Pirkoh.Sui Southern Gas Company Limited The Company in its present shape was formed on March 30. Badin.

Demonstrates sensitivity. Solicits and share ideas/best practice with others. SSGC’s MISSION To meet the energy requirements of customers through reliable. providing quality service by maintaining a high level of ethical and professional standards and through the optimum use of resources. Strives for Continuous improvement. environment-friendly and sustainable supply of natural gas. Seen & known to be honest. CORE VALUES Integrity: Keep Company's Interest above self. Lives within means. Supports the achievements of Company/team goals. ethically and with responsibility to all our stakeholders. Respond effectively to customer needs. Displays openness and consistency in applying policies & Procedures. community and the nation. while conducting company business professionally. Promote ethical business environment. Teamwork: Builds strong relationships within across functions. Takes timely and Quality decisions. Intellectually hones. Excellence: Makes positive contribution towards the achievement of SSGC's Vision. Creativity: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Contributes to team effectiveness using people's different skills and styles. Acts in ethical manner. Works well with all type of Peoples and corporate with others. Respects dissent and resolves conflicts fairly. Take effective actions if observers unethical behaviour or situation. Arrives at constructive solutions while maintaining Positive working relationships. efficiently. Transparency: Promotes open environment.Sui Southern Gas Company Limited To be a model utility.

Promotes modified approaches. regulatory. customers. Distribution. with the exception of Finance. pricing. Engineering Services. The major portion of the work force consists of technically qualified and skilled personnel. [ ORGANISATIONAL CHART Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . OGRA is responsible for regulation. Responsibility to Stakeholders: Stays abreast of change in operating environment that impacts our business (i. Management Services. Develops colleagues and team members to improve their skills and performance. which is headed by the Deputy Managing Director. revenue determination and compliance to service standards.Sui Southern Gas Company Limited Comes up with new ideas. The Board of Directors has the overall responsibility for the management and control over the Company. Organizational Structure: The Company is organized into six functional divisions -Transmission. Encourages innovation. Commercial. employees. markets.e. political and public). Policy matters relating to the natural gas sector are handled by the GOP. Balances short term and long term priorities to maximize on results. Each division is headed by a Senior General Manager assisted by a team of professional staff. Ensures compliance of law. suppliers. Create solutions to make Customer needs. The management enjoys operational autonomy. Convert Ideas into actions. and Finance. Technology. competitors. Ensure Optimum utilization of resources.

Sui Southern Gas Company Limited FUTURE OUTLOOK Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

 Expansion of distribution network and supply mains by 5.  Multiple bill payment options and channels (ATM.764 km in 2005 to 31.9 billion.  Enhancement of gas supply to power plants. ORIX POS.  Consistent appreciation in shareholder’s value by increasing the company’s asset base and significant improvement in productivity and efficiency. Key objectives of the strategic plan for the next five years (2005-06 to 2009-10) are the following:  Expansion of transmission network by 608 Kms from 2. training of employees and development of management.236 km from 25. enhancing capacity from 1. industrial and commercial sectors including supply of gas to previously deprived areas in the domestic sector.  Improve the quality of human resource through career planning. and NADRA-Kiosk).  Latest technology digital prepaid meters with improvement of call centres to include an online customer information system.942 km in 2005 to 3. to improve company efficiency and implement ERP. friendly and efficient customer services under the vision of “Service with a smile”.  Revamp the current business processes.  Focus on improved.8 million to 2.700 MMCFD by 2010.300 MMCFD in 2005 to 1.Sui Southern Gas Company Limited The Company is pursuing an ambitious five year development and expansion plan estimated at Rs 42.  Increase surveillance and introduce an automated emergency response system (ERS) and SCADA for the security of company assets including the transmission and distribution networks.2 million by adding 447. Call Centres.000 km by 2010 connecting 600 new towns and villages in Sindh and Baluchistan. CIS. Internet.550 km by 2010.  Establishment of 16 fully automated (additional 8 in progress) on line customer facilitation centres.  Increase of the customer base from nearly 1. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Drop Boxes.000 new customers to the Company’s system. GIS and the best business policies for ISO 9000 certification.

DISTINGUISHING FEATURES Developing Human Assets: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .  Community support services and corporate communication initiatives to meet the national and social responsibilities.”  Human resource development and empowerment of employees through career planning and continuous management/vocational training. as a good corporate citizen.  Set up Enterprise Information System (EIS) in all areas of business using state of the art technology to make SSGC the “Most IT Enabled Company. occupational health and safety system as required under Certification ISO 14001 and OHSAS 18001 standards.Sui Southern Gas Company Limited  Implement environment management system.

For example. SSGC's computerized billing system prints bills through the online network in the entire franchise areas. queries and suggestions. Enterprise Resource Planning (ERP) software integrates all departments and functions on to a single computer network. the Information Technology Department is rendering strong support to SSGC. The company undertakes several initiatives to ensure induction and training of professionals with the objective of ensuring high level of professionalism and productivity of its employees. technology brings greater benefits to customers. The Company is also introducing innovative Pre-paid Gas Meters for convenience of customers. Excellence In Customer Service: The SSGC motto is 'Service with a Smile' and SSGC people strive to provide unmatched and diverse services to customers through innovative and progressive ideas in line with best international practices. Above all. SSGC has signed a comprehensive enterprise agreement. Human Resource Development is one of the top priority areas at SSGC. Pre-paid meters offer such facilities as advance payment and flexible payment and allow people to manage gas consumption at their own convenience.a computer-based system that effectively provides forecasting data for further strategy development. SSGC has developed Customer Facilitation Centers in all major towns and large population centers that provide fast and efficient response to customers’ queries and complaints.Sui Southern Gas Company Limited SSGC believes that satisfied employees provide Quality service.the only such agreement by a public sector utility company in Pakistan. with Microsoft . For speedy and efficient handling of customers’ complaints. Realizing the need for integration of IT into core business processes. Maintaining its technological edge. Edge in Technology: Quest for excellence and cutting-edge technology has played a key role in SSGC expansion and strength. SSGC is set to become the most IT enabled Company in the country. Increasing the efficiency of business processes is another priority area for SSGC. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . all SSGC meter reading is now carried out through hand-held computers .saving valuable time and minimizing errors. Today. SSGC provides satisfaction of its employees and gives them adequate incentives to provide high quality work. A key initiative of this department is the implementation of the Geographic Information System .

all SSGC offices and facilities remain connected 24 hours a day. It’s Health & Safety and Environment (HSE) management system ensures that the standards. and with video conferencing facility. efficiency and financial viability of new projects. processes and procedures needed to achieve safe operations are identified. Shikarpur. Emergency Response Centers (ERCS): ERCs are working at six key locations at Karachi and Quetta terminals. such as PL Studio simulation software. wars acts and similar activities. STRATEGIES Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Through the advanced microwave digital network. Dadu and Sibi Head Quarters. driving higher performance. Nawabshah. These are fully equipped to deal with any emergency situation in case of transmission gas pipeline rupture/fire resulting from sabotage. Telecommunications: Telecommunications plays a vital role in maintaining high operational efficiency at SSGC. implemented and maintained. which accurately simulates the large and complex pipeline network. special steps have been taken towards ensuring maximum efficiency. Promoting Safety: SSGC is committed to the health and safety of its employees and preservation of the environment in its areas of operation.Sui Southern Gas Company Limited Since the pipeline network forms the backbone of SSGC's operations.

Within the induction of new.I.Sui Southern Gas Company Limited  The company has moved beyond basic reengineering as it builds and reinforces culture change by creating performance opportunities.  Business Process Re-engineering (BPR). industries and commercial sector including supply of gas to previously deprived areas in the domestic sector.  The company identified successfully different layers of change that needed to be managed concurrently for large projects to be implemented on schedule and within budget.  Customer satisfaction.  Consistent appreciation in shareholder’s value by increasing the company’s asset base and significant improvement in productivity and efficiency. re-structuring of select departments and implementation of ERP to provide effective M. Optimizing market flexibility and maximizing return on investment from major change initiatives are key success factor for the company. developing Human Resources and pursuing overall business excellence. processes and technology. improved business process.  The company has adopted an aggressive approach to empower the executives and to create awareness in the rank and file for changing the routine business processes with people-centric work methodology with focus on moving over to best business practices.  The SSGC has pioneered efforts for deployment of a cost-conscious and performance-based culture and empowerment of the employees to provide for achievement and excellent at all levels. innovation. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .  The company has taken the lead in integrating Change Management within its people. quality services and promotion of service with a smile culture.S for business operations and control.  Expansion of distribution and transmission network for enhancement of gas supply to power plants. an appreciable change in productivity was achieved.

Sui Southern Gas Company Limited
 Enterprise Information System (EIS) and technology implementation in all areas of business to make and maintain SSGC the most IT enabled company.  Human resource development and empowerment of employees through career planning and management / vocational training.  Improvement in reliability and security system.  Improvement in customer services through additional Customer Facilitation Centers, installation of pre-paid meters, and improved bill delivery.  Community support services and environmental protection initiative to meet the national and social responsibilities as a good corporate citizen.

COMPANY’S OBJECTIVE
The Company aims to supply natural gas wherever there is sufficient load to justify the cost of infrastructure. In many places the gas network is being expanded to meet economic and social requirements through active funding support from the Federal and Provincial governments. In 2003, the Company launched a comprehensive fiveyear gas network development and expansion  Plan to connect hundreds of small towns and villages in remote areas of Sindh and Baluchistan, which currently are deprived of piped natural gas.  Every year, the Company adds nearly 75,000 new customers (industrial, commercial & domestic) to its customer base and lays hundreds of kilometers.  Transmission pipelines and distribution network and installs other facilities such as metering / billing stations in its system using its staff of technically qualified and skilled personnel.

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INTERNSHIP REPORT

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Sui Southern Gas Company Limited

PERFORMANCE
 Over the period 2000-01 2006-07, the Transmission Network has increased from 2, 777 km to 3,290 km i.e. an addition of 285 km (10%) and the Distribution Network has increased from 22,159 kms to 29,832 kms showing an addition of 7,673 km (26%).  The above expansion has contributed towards increasing the number of customers from 1.57 million in 2000-01 to 2.040 million in 2007-08. Yearly gas sales have shown an increase from 206,967 MMCF in FY 2000 to 409,375 MMCF in FY 2008. Furthermore, with an addition of around 550 new towns / villages since 2000-01, the total strength of towns and villages on gas has reached 1260 by the close of FY 2007-08.  Annual gas sale revenue has increased from Rs. 29.237 billion in FY 2000-01 to Rs. 85.716 billion in FY 2006-07, showing an increase of (56.479 billion) over the past seven years. This increase is mainly due to connecting newly discovered gas fields through transmission system network enhancement and optimizing gas flows.  Meter manufacturing capacity has increased from around 292,750 in FY 20002001 to over 513,250 in FY 2007-08 fully meeting increased requirements of SNGPL and SSGC.

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INTERNSHIP REPORT

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Sui Southern Gas Company Limited

Personal Introduction:
Currently, I am studying in the 2nd oldest university of Pakistan, University of Sindh, Jamshoro in BBA (Hons) P-III. I have completed five semesters of my studies and have been successfully enrolled in the sixth semester. . I have scored 84% with CGPA (3.54) in 2nd year. At present, I have done introductory courses of Management, Economics, Marketing, Finance and Accounting. However, I have developed substantial interest in Finance and therefore, plan to do my majors in Finance. I have a keen interest in doing internship in SSGC (Sui Southern Gas Company) as it would be beneficial for me in future and it is the leading and best company. My internship experience at SSGC has provided me with valuable insight and has helped me in increasing my knowledge of the subject. It has introduced me to the operations that take place in the professional world and has provided me with the opportunity to work in a dynamic environment where I can exploit my concepts.

Personal Data:
Father Name: Date of Birth: NIC No: Marital Status: Religion: Nationality: Cell No: Email Address: Khalid Mahmood 27th May, 1986 41304-2883443-3 Single Islam Pakistani 0321-3050821 awais_ghauri@yahoo.com

Computer Skills:
 Dos, Windows-98. 2000. XP  MS-Office- 2007, XP  Internet  HTML and basic Knowledge of networking  Effective Communication  Internet Browsing

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I learnt the core values of the organization. Different projects & assignments had promoted me to meet challenges and be confident. During our BBA degree I have been studying the different business related subjects. But I came to realize its importance when one of the groups from internees look this challenge and firmly decided to visit the hospital where nobody wants to go. It aims at understanding how the things are practically going on in the organizations. than as the time I could gain real experience. Personal Learning Corporate Culture. As I said SSGC is our mother and Caring Organization was always there to facilitate us. At SSGC I saw its practical exhibition in terms of not paying the attention of BOSS or he may not learn as he can for his slackness for being late. Corporate Social Responsibility: CSR was mere a term for me as I used to come across with this topic in my texts. In this regard.e. More over. in which I participated for a “good cause” (above all) we were all basking in the glory of the success of this event. Understanding: As the basic purpose of internship is the introduction of corporate culture to the students. how the theories we read in books are implemented and executed. Punctuality: Punctuality the first and foremost things which is essential for a professional at work i. punctuality and the very first thing I have learnt in SSGC i. SSGC made me punctual and made me realized that ‘TIME IS MONEY”.Sui Southern Gas Company Limited MY EXPERIENCE IN SSGC Purpose of the Internship: The purpose of internship is to learn the skills regarding working in industries. Leading & Becoming Effective Team Player: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Successful arrangement of this event was a empirical example of “Event Management” full of lesson. The meeting and communication with the diverse people made me understand and adjust myself with the different people working in the organization. previously I have heard that famous quotation which goes like that “late comer must suffer” I did not know in terms of what he may suffer. which were quite informative and bit challenging. I learnt a lot in the dynamic organization of Pakistan SSGC. Throughout Six weeks I learnt a lot of things regarding my specialization.e. behavioral conduct. It was essential to me that I enter in highly regarded or reputable organization. know-how about the corporate culture & Organizational environment. SSGC is very keenly fulfilling its corporate social responsibility with its loyal and committed workforce along with energetic etc. and enthusiastic ambassadors (internees). the dynamic employees shared their ups and downs and other different experiences of their corporate life that has been a great learning for me.

III.Sui Southern Gas Company Limited Blending with different people becoming social able and building affinity with them was an insurmountable task for me. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Be flexible and show sensitivity for others feelings. IV. Respect each team member Respect the way people work Be patient and listen to all and play your part Appreciate noble / gracious ideas presented by any your team member and try to become part of the solution not part of the problem. SSGC has bridged this unbridgeable gap in my personality and enabled me to adjust myself in any environment for becoming effect team player I have learnt the requisites that: I. V. II.

Sui Southern Gas Company Limited OVERVIEW OF FINANCE DEPARTMENT Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited Overview of the Finance Department Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited FINANCE Finance Treasury Accounts Payroll Cash & Bank Cost & Revenue Budget Insurance Loans Fixed Assets Payments Investments MIS Gas Purchase Gas Sales Distribution System Transmission Project Taxation Financial Feasibilities Revenue Control Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

The treasury function department can be further subdivided into five major categories. FINANCE DEPARTMENT The Finance Department is further subdivided into sections. These section heads report to Chief Manager (CM) Treasury Function who is responsible for the overall activities of the treasury function Department. An important task of the Treasury function department is to keep a check on the company’s current liabilities account and make sure that their current liabilities do not exceed their current inflows of cash. management of funds. which are somewhat interrelated. treasury functions deals with the flow of money either in the form of inflows or outflows. In short. which includes the following:  Payroll  Fixed Assets  Insurance  Gas Purchase  Transmission Project  Payments Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . The division is as follows:  Cash & Bank  Loan Payments and Funds Management  Revenue Control  Taxation  Investments All these sections have separate section heads who are responsible for the activities of the people working in their section. collection. payment of foreign or domestic loans. revenue control and reconciliation of bank and customer accounts. receipts.Sui Southern Gas Company Limited TREASURY FUNCTION The Treasury Function Department of the finance department basically deals with the disbursements.

if any. Stores.  Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Trade and Other Payables: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . It is charged from the dates these projects are available for intended use up to the date these are disposed off. if any. transmission lines and other operating assets is calculated under the straight line method over their estimated remaining useful lives. Stock-in-trade:  The stock in trade comprises of Gas in pipelines and Meter manufacturing division. Spares and Loose Tools: These are valued at cost determined under the moving average basis less impairment losses.Sui Southern Gas Company Limited MAJOR ACCOUNTING POLICIES Property. Property. leasehold land and capital work in progress are stated at cost less accumulated depreciation. plant and equipment except freehold land. Balances considered bad and irrecoverable are written off when identified. Goods in transit are valued at cost incurred up to the balance sheet date Trade Debts: Trade debts are carried at cost less provision for doubtful debts. leasehold land and capital work in progress are stated at cost  Depreciation on compressor. Freehold land.  Stock of Gas in transmission pipelines is valued at lower of cost determined under the weighted average basis and net realizable value whereas the materials for meter manufacturing division is valued at lower of moving average cost and net realizable value. Plant & Equipments:  Assets are not revalued and historical cost is taken into account.

 However the company is required to earn a minimum annual return before taxation of 17% per annum o the net average operating fixed assets (net of deferred credit) for the year. The meter rental is recognized monthly at specified rates for various categories of customers on an accrual basis whereas the sale of meters and gas condensate is recognized on dispatch to the customers. Dividend income on equity investments is recorded on accrual basis. Income earned in excess or short of the above guaranteed return is payable to or recoverable from the Government of Pakistan and is adjusted from or to the gas development surcharge payable to or receivable from GOP. Revenue Recognition:  Revenue from Gas sales is recognized on the basis of gas supplied to customers at rates periodically announced by the Oil and Gas Regulatory Authority (OGRA). etc are deferred and are recognized in the profit and loss account over the useful life of the related assets. Deferred Credit: Amount received from customers and the government as contributions and grants for providing the service connections.  Deferred credit income is amortized to the profit and loss account over the useful life of the related assets. extension of gas mains. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . laying of transmission lines.Sui Southern Gas Company Limited Liabilities for trade and other payables are carried at cost which is the fair value of the consideration to be paid in the future for goods and services received.

Sui Southern Gas Company Limited Long Term Deposit:  Long Term deposits consist of security deposits from Gas customers and gas contractors. These deposits are repayable and adjustable on the disconnection of gas supply. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .  Gas customers’ deposits represent Gas supply deposits based on an estimate of three months consumption of gas sales to industrial and commercial customers while deposits from domestic customers are based on the rates fixed by the  Government of Pakistan.  Security deposits from contractors are free of mark-up and refundable on the cancellation of contract.

Sui Southern Gas Company Limited AREAS OF WORKING I sought opportunity to join SSGC to upgrade my skills in multi-dimensional approach to the section of the Finance Department. Whatever I attained there is elaborated as under:  Fixed Asset and Capital Budget  General Ledger  Gas Distribution System (GDS)  Inventory Accounting  Local Order  Insurance Section Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Board of directors grants approval to the agenda after which the budget is authorized to be followed. all the departments are notified to make the proposed budget themselves for there departments according to the requirement of their department and send it to budget section. the available amount in the budget for that department. company wise. The budget section can increase or decrease the proposed amount of budget keeping in view.Sui Southern Gas Company Limited FIXED ASSEST Responsibilities of Fixed Assets: Following are the main responsibilities of fixed assets: 1. retirement and disposal of all the fixed assets.” The budget section of finance department prepares capital expenditure budget (CAPEX) annually for all the departments of SSGCL. Preparation of capitalization and WIP schedules of all the companies i. account wise. To maintain the capitalization. 3. After receiving the proposed budgets from the departments. FIXED ASSET ADITION PROCESS Capitalization: Whenever a budget is to be prepared for any department. the budget section examines it & discusses all particulars with the related head of department & staff giving special consideration to the justification of fixed asset requirement & funds available in the company. Budget Phase: “Budget is a financial statement which is prepared before the starting of the financial year containing the plans and policies to be pursued during that period. Hyderabad distribution. depreciation. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . then the agenda is prepared by budget section. 4. half yearly and yearly accounts and schedules of organization. 2. Making proposed budget (CAPEX). department wise. Karachi distribution. Transmission and Head Office. When the budgets for all the departments have been finalized and approved by MD. When budget section starts to create the budget. After the proposed budget is prepared by the Budget Section.D for approval. Each department is then informed through inter departmental note along with a copy of their budget. budget is then sent to GM & SGM for its approval/changes & finally to the M. Baluchistan distribution. which is reviewed by finance committee. the concerned department will be only allowed to purchase the assets listed in the budget for the whole year.e. After the approval of the budget. the budget section notifies the department to prepare list of assets required by them for the coming year. Prepare quarterly.

It even differs for same assets in different cities. transfer of an asset from one unit to another.Sui Southern Gas Company Limited In order to purchase an asset. Full year depreciation is charged for the first year regardless of its purchase data. Depreciation rates differ for different assets. Depreciation: Once an asset has been capitalized. If the amount for the required asset is available in the budget then the Material Management department invites quotations through tender (if not available in store) and on the basis of commercial and technical evaluation and lowest bidders. In the certain situation we call for making adjustments e. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . where Deputy Manager checks whether the FAR falls within the budget or not. where reducing balance method is used. All assets are received by the KT stores department. fixed asset requisition (FAR) is required to be filed by concerned department. where quality inspection is conducted (however not documented) and then a Material Receiving Statement (MRS) is generated and a copy of which is forwarded to the finance department. The company uses the straight line method of depreciating except for meter plant. working for its depreciation starts. FAR contains details of assets required by the department. different between assets in books and its physical existence etc. a supplier is selected (all such procedures documented in Evaluation Report) and then Purchase order (PO) is prepared and sent to supplier. which should be approved by the head of that department. The FAR is then forwarded to Material Management department.g.

M Bid Opening For Purchase Intent Letter Is Sent To Supplier Evaluatio n Report Is Prepared Quotatio n Is Received From Supplier ****PBG Is Submitte d By Supplier Purchase Order Sent To Supplier Asset Is Received By R&D At KT Asset Is Capitalize d Charge To Asset Clearing Account Material Receiving Statemen t Is Prepared * Department ** Fixed Asset Requisition *** Material Management ****Performance Bank Guarantee Work In Progress (In case of construction) Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited FLOW CHART OF FIXED ASSET ADITION Approval In Budget User *Deptt. Sent **FAR To ***M.

are deleted from the books through approval of the management. It is approved / disapproved on the basis of inspection report by GM. only those asset which have a zero book value can be retired. DGM and MD store at KT for disposal Section Inspection report sent to the inventory along with ARA Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . The company SSGC’s follows certain policies for retire of asset e.Sui Southern Gas Company Limited Fixed Asset Retirement process After the completion of life of asset which is fixed by company we retire it. it is sold on written down value or at 7. which is to be retired for verification of the condition of the asset. That inspection team inspects the asset. In case an employee of the company buys it. After inspection the report sent to the fixed asset section along with ARA. Fixed Assets Retirement Process Asset Retirement Advice prepared by the user department and sent to the inventory section Inspection of the asset to be retired is conducted for verification of the condition of that asset Asset sent to Retirement advice is approved / disapproved on the basis of inspection report by GM. which are fully scraped and not present physically. After checking the book value the inspection team is to be formulated.g. DGM and MD.5% of its cost. And some old assets. After approval the asset sent to store at Karachi Terminal (KT) for disposal. 1st the Assets Retirement Requisition (ARA) is prepared by the user department and it is sent to the fixed asset section of finance to retire that asset. whichever is higher.

/Cr. Exp Acc. Dep. Contr a Purchasing Requisition No Accounting Inventory Receiving Inventory Receiving Account AP Accrual Account 3081111 2073214 C1 C2 Inventory Deliver Asset Clearing Account Inventory Receiving Account 3011999 3081111 C3 C1 AP Invoice AP Accrual Account Liability Account 2073214 2073201 C2 C4 AP Payment Liability Account Bank 2073201 Bank a/c. Dep.Sui Southern Gas Company Limited FIXED ASSET ACCOUNTING CYCLE Module Purchasing Step Requsition Accounting No Accounting Dr. Asset Cost 3011999 5062101 3012117 DR C3 DR CR CR DISPOSAL OF ASSETS (IN CASE OF PROFIT) Assets Assets Assets Assets FA MODULE FA MODULE FA MODULE FA MODULE Acc. Dep. C4 FA ADDITION Assets Assets Assets Assets FA MODULE FA MODULE FA MODULE FA MODULE Asset Cost Account Asset Clearing Account Dep. Asset Cost Account Proceed from sale of FA Profit on sale of FA 3012117 3011117 3013991 4026401 DR CR DR CR DISPOSAL OF ASSETS (IN CASE OF LOSS) Assets Assets Assets Assets FA MODULE FA MODULE FA MODULE FA MODULE Acc. Asset Cost Account Proceed from sale of FA Loss on sale of FA 3012117 3011117 3013991 4026401 DR CR DR DR Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

In “PREPARE MASS ADITION” select Book “SSGC Corporate” and Queue “New” and press “Find” Button. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 2. Select asset from Mass Addition’s summary whose Queue is “New”.Sui Southern Gas Company Limited FIXED ASSETS MANDATORY STEPS Following are the required steps involved to add asset in Asset Module through System: 1.

a. Select asset from Mass Additions Summary window.Sui Southern Gas Company Limited 3. press open button and change the Queue from "New" to "Post" and enter the following Information. Category. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited b. Depreciation Charge Account C. Location. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

4. Go to Menu Mass Addition --> Post Mass Addition Run Post Mass Addition Report Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Press “Done” to confirm the action.Sui Southern Gas Company Limited d.

Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited 5. Detail of Capitalized asset can be seen from “Work Bench”.

quarterly. books of accounts. yearly basis for top management  Processing of reports from oracle on monthly.Sui Southern Gas Company Limited GENERAL LEDGER SECTION Function:  Processing of all journal voucher (JV) from different section and location in finance department  Resolution of queries raised by the ERP system during JV processing  Posting of all financial modules to general ledger  Processing of reports from oracle on monthly.  To facilitate and co-ordinate the annual audit  To comply with the policies and the procedure notified by OGRA from time to time.  To comply with the policies and the procedure notified by Security and Exchange Commission of Pakistan (SECP). quarterly.  To report the results to board of directors and share holders of the company Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . yearly basis for oil and gas regulatory authority (OGRA) Purpose:  To maintain proper and accurate.

Sui Southern Gas Company Limited The General Ledger Accounting Cycle Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

use the Enter Journals window. Check for posting errors. 4. etc. 13. Import journals from subledgers. 5. Enter manual journal entries. but have different posting amounts. use the Journal Inquiry window. Generate recurring journal and MassAllocation journal batches based on formulas you defined. including the batch period and the journal currency. Review the details of your unposted journal batches.  Formula entries use formulas to calculate journal amounts that vary from period to period. You can also create recurring journal formulas to create allocation entries. 8. You can use recurring journals to create three types of journal entries: Skeleton entries affect the same accounts each period. You can consolidate sets of books that have different charts of accounts and calendars. produce a Journals .  To view and optionally change unposted journal batches online. You can reverse a posted or unposted journal entry. Define MassAllocation formulas to allocate a cost pool across a group of departments. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .  6. including:  Standard journal entries  Foreign and dual currency journal entries  Statistical journal entries  Intercompany journal entries 3. Once you assign a reversing period to the journal.  To print a report showing unposted batch detail. 10.General report (set the Posting Status parameter to unposted). Edit unposted journals to change information about an unposted batch or its journal detail. 9. Post your journal batches manually or automatically. 7. General Ledger automatically produces a Posting Execution Report so you can check the results of your posting.Sui Southern Gas Company Limited Follow these steps to enter.  To view unposted journal batch detail online.  Standard recurring journal entries use the same accounts and amounts each period. Reverse journals. Define recurring journal formulas for transactions that have a common format or that you enter frequently. If you encounter an error when trying to import a subledger journal. Consolidate sets of books by defining and running a consolidation. 14. Revalue your foreign-denominated assets and liabilities to reflect exchange rate fluctuations at the end of each accounting period. 2. Translate your actual account balances to any foreign currency for reporting purposes. 11. generate and post the reversing batch. companies. maintain. you can correct the import data and rerun journal import. This report notifies you of any errors. Open an accounting period. 12. and report on actual accounting information for your enterprise: 1.

Reports With the help of Oracle Financial Application general ledger reports can be viewed. For generating general ledger reports we first need submit a request. 18. category and date. General Ledger. These reports list beginning and ending account balances and all journal entry lines affecting each account balance. Close the current accounting period.  Review account balances online using the Account Inquiry window.Sui Southern Gas Company Limited 15. Open the next accounting period. 16. as well as in the General Ledger and Account Analysis reports. Through this option the journal details can be reviewed and checked for errors. The report provides detailed information on each journal entry line including source.  You can also define an unlimited variety of custom reports using the Financial Statement Generator to review account balances in the format of your choice. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Produce financial reports and perform online inquiries to review current account balances. 17. We can either submit a single request or a request set. Examine General Ledger and Account Analysis reports to identify the source of suspense account entries. Enter journals to clear suspense account balances. General Ledger Reports facilitate tracing back each transaction to the original source.  Review posted journal details in the Posted Journals Report.

For example we can view a detail Trial Balance detail report or an account analysis Reports etc. first we need to type in the name of the report that we want to generate. we need to enter the type of report that we want to view. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . In order to run the request.Sui Southern Gas Company Limited After selecting the type of request. Oracle GL provides us with a number of options.

Account type. Detailed information is provided for each journal entry line which includes the source. and description. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Reports can be generated in clusters and groups by entering any of the following: • • • • • Company Function Location Organization Unit Project After selecting the type of report that we want view. we need to enter the details of the projects that we want to view. and descriptions and reference information for each journal entry line. batch name. You can report on foreign currency.Sui Southern Gas Company Limited Accounts Analysis Reports: These reports list the accumulated balances of a range of Accounting Flex fields and all journal entries that affect that range. Trial Balance Reports: Use trial balance reports to review account balances and activity in summary or detail. Details like segment. posted. Period Currency etc. Journal Report: These reports print journal entry batches and include journal entry subtotals. non-posted or error journal entries and report on a specific batch or on journal entries from a specific source.

Oracle application starts processing the given request and as a result of that it provides the user with various options which includes viewing the output or details of the requests.Sui Southern Gas Company Limited As soon as the request is submitted. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . It also provides the option of diagnostics and holding and canceling of a request. The Screen shot below shows the format of the generated reports.

the user can easily view the details of the project which includes the date. submission date. status etc Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . completion date.Sui Southern Gas Company Limited By selecting the view detail button.

Sui Southern Gas Company Limited GAS DISTRIBUTION SYSTEM (GDS) Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

040 million customers. uploading the budget of each project on ERP system. These include preparation of feasibilities of Transmission projects and Gas fields under various options.014. processing Rehabilitation. preparation and monitoring of Annual Distribution budgets for all new town and villages. The company also owns and operates the only gas meter manufacturing plant in the country.An Introduction: The Gas Distribution System (GDS) is one of the vital sections of SSGC’s Finance Department.468 million cubic feet (MMCF) gas was sold in 2007-08 to over 2. industries. The distribution activities covering over 1200 towns in the Sindh and Baluchistan are organized through its regional offices.877 Km. For achieving the above mentioned targets the GDS of the finance department performs a number of activities. It includes submission of performance reports/ status reports to MNPR through Sales. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . domestic and commercial sector including supply of gas to previously deprived areas in the domestic sector.192 commercial and 2. Infrastructure: SSGCL transmission system extends from Sui in Baluchistan to Karachi in Sindh comprising over 3. maintaining funds position related to New Towns & Villages and coordinating with Sales Department and Ministry of Petroleum & Natural Resources (MNPR) in this regard .150 meters.448 industrial.Sui Southern Gas Company Limited GDS .200 KM of high pressure pipeline ranging from 12-24" in diameter. having an annual production capacity of over 550. Distribution System accounting include development of mains laying rates (MLR) all region rectification and monitoring of Distribution Budget of all region and project accounting related to distribution Projects.827 domestic consumers in these regions through a distribution network of over 31. The basic task of the Finance department’s GDS is to perform all the accounting activities related to the expansion of distribution and transmission network for enhancement of gas supply to power plants. 22. Reinforcement and New towns schemes of all regions including re-appropriation of Budget and settling issues related to Distribution of all regions. It includes 3. An average of about 378.

Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . CNG stations and Co-operative Housing society on cost sharing basis.  Transmission projects  Supply of gas from Gas fields  Construction of pipeline and to received pipeline rental. Preparation of financial feasibilities is one of the major tasks of this department.  Supply of gas to New towns & villages on request of GOP  Industrial estate  Other Capital project This section consists of one Deputy Chief Manager and two Deputy Manager.Sui Southern Gas Company Limited Responsibilities of GDS: The issuance of Job cards. it is also necessary to ensure that the amount transferred to Deferred Credit with respect GOP funds & customers advance is in accordance with IAS & Company’s policy. reconciliation of deposit is also the responsibility of the finance department. For the GDS. These financial feasibilities and reports are prepared for the following projects. Two ERP executives are also a part of the GDS team. Feasibility reports are prepared for providing recommendations to the managements regarding the approval of various projects. Commercial. For supply of Gas to Industrial. Journalisation.

Issues The Job Card Job Card Send To The SITE Through Sales Dept. SITE Team Start The Work Once The Job Has Completed. Through Sales Finalize The Project By Finance Dept Page 24 of 95 Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT . Received Request With Processing Fee Visit The Customer Premises Determine The Cost Of Customer Connection Approval By GM Sales Quotation Send To Customer Customer Pay The Advance Receipt Send To The Finance Department Finance Dept.Sui Southern Gas Company Limited PROCESS OF NEW PROJECT Sales Dept. Job Card Send To The Finance Dept.

Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Cr.Sui Southern Gas Company Limited GDS ACCOUNTING CYCLE AND MANDATORY STEPS Cash & Bank Bank Advance Dr. GDS Asset/Revenue Project Advance Loan/Deferred Credit/Installation Cost Dr. Dr. Store Project Store Dr. Cr. Cr. Cr.

SSGC today delivers natural gas to over 1.92 million domestic customers in more than 1.Sui Southern Gas Company Limited Categories of Customers: The SSGC is the second largest gas production and transmission company of the nation with a franchise covering Sindh and Baluchistan.184 industrial units. design. 20. operation and maintenance of an extensive gas supply infrastructure and is fully capable of providing innovative gas technology solutions to other companies in the region. SSGC is widely acknowledged for its world-class expertise in the engineering. Sui Southern Gas Company Limited has four major categories of customers. Categories of Categories of Customers Customers Domestic Domestic Customers Customers Commercial Commercial Customers Customers Industrial Industrial Customers Customers Power Power Generation Generation Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . construction.971 commercial organizations and 1.94 million customers comprising 3. Commencing operations in 1954 as Sui Gas Transmission Company (SGTC).200 towns and villages.

SSGC has nearly 1. maternity homes and other small businesses etc. churches. the SSGC motto 'Service with a Smile'.Sui Southern Gas Company Limited Domestic Customers: A large portion of SSGC customer base comprises of Domestic customers. in Karachi only almost 144 new commercial customers have registered.40 million are located in Karachi and the reaming in the rest of the Sindh. This category of customers includes the CNG stations. barbershops. other religious places. Commercial Customers: Commercial segment is also one of the important segments of SSGC customer Base. The customers engaged in the process of creating value added finished products from industrial raw materials are called industrial customers. tea stalls. SSGC is striving hard to increase its customer base and to meet the everincreasing demands of its customers. Cement factories. schools and private educational institutions. Keeping in mind. milk shops. Govt. Of these. and Semi-Govt. This category includes all establishments registered as commercial units with local authorities or dealing in consumer items for direct commercial sale like cafes. FFC Jordan Fertilizer. theaters. armed forces messes and universities. Pakistan steel. The number of commercial consumers currently exceeds s 20. canteens. over 100 smaller towns and 930 villages. These domestic customers include residential colonies. laundries. places of entertainment like cinemas. the people at SSGC have always strive to provide un-matched and diverse services to customers through innovative and progressive ideas in line with best international practices. The gas consumption of the industrial sector has been showing growth every year. temples. However. Govt. guesthouses. mosques. Nearly 98% of SSGC customers can be categorized as domestic users. nearly 1. orphanages and other charitable institutions. Almost 686 new commercial customers have registered only in Karachi in the year 2008. and hostels attached thereto.000 and the list is growing. In the year 2008. More than 3000 industrial customers buy natural gas from SSGC. colleges. 1000 and it is non-refundable. bakeries. As a result. Industrial Customers: SSGC is doing an excellent job in fulfilling the gas needs of the industrial sector of our economy. SSGC have catered to almost new 374 industrial Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . The processing fees for domestic customers are Rs. In the year 2008. clinics. offices and hospitals. clubs.92 million domestic customers in 6 major cities. Ice factories. and private office.

5% of the total volume.Sui Southern Gas Company Limited customers’ demands in Karachi. Core areas of DSS Existing Areas New Town and villages Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . These processing charges are non-refundable but adjusted with the cost of the connection charges. the single largest customer has converted its entire power generation to natural gas and now consume between 200-300 mmcfd of gas to run its 1400 MW gas turbine power plants. Power Generation: All units generating power through gas are called power generation units. This includes WAPDA. KESC.000. and HABIBULLAH COASTAL. KESC accounted for 28% of SSGC sales in 2004-05. Sales to the power sector constituted 46. The processing fee for industrial consumers is Rs. Many industrial consumers use natural gas for captive power generation as well as to meet their process needs. 10. KESC.

domestic and commercial sector. However the detail process is discussed in the later part of the report Mains Extensions for Domestic / Commercial Customers Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited Functions of DSS – Existing areas Mains Extension Service connections Meter Installation Other Capex Recoverable Jobs The core activities of DSS can be broadly divided into two major areas  Existing Areas  New Town and Villages DSS works for supply of gas to the previously derived areas which includes many towns and villages and also for the enhancement of the existing gas supply system to our industrial.

Distribution Mains: Distribution Mains consist of network of pipes laid in streets and towns for providing gas to the customers. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited Main Extensions Supply/ Feeder Mains Major Mains Distribution Mains Minor Mains Paid Mains Main extension can be classified into two major categories  Supply/ Feeder Mains  Distribution Mains Supply/ Feeder Mains: These Mains are generally for the supply of gas to a particular area and then other connection are further provided from the Supply Main or Transmission Pipeline.

these cases are processed throughout the year under the limit of approval obtained. These targets and the amount involved are allocated in the Annual Budget. Paid Mains: When the case does not fall under the CCE criteria and the capital cost per consumer far exceeds CCE criteria then the case is treated as PAID MAINS. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . it is necessary to get certain kilometers approved by the management. which contains capital cost/ length and diameter of mains to be extended and number of gas connections to be processed during the financial year. Towns & Villages. for the expansion of the distribution network of mains for te supply of gas to residential.S / from the SSGC system up to the prospective consumer premises i. if they agree. However. which is approved by the Board of Directors. Minor Mains: In cases.B. commercial and industrial areas. Under this case an option will be given to the customer to either process the project through cost sharing or on self-finance basis. The Normal pressure of gas is maintained from 08 to 60 PSIG. The Distribution mains can be further classified into three categories: • • • Major Mains Minor Mains Paid Mains Major Mains: As per present practice of the company.e.Sui Southern Gas Company Limited These mains are constructed from the outlet of T. in streets of Cities. is less than 1Km then it is categorized as Minor Main. where length of mains extension required. Every year Physical Targets are fixed by the company. All such cases are approved by the management once in a financial year in the Annual Development Plan. In this case also. Mains extension of 1 km and above for any particular scheme or area is categorized as Major Main. Details of physical targets are proposed by the Sales department. Physical targets for the following are approved by the Company’s Board for each financial year.

Sui Southern Gas Company Limited Standard Procedures Applicable To The Process Of Distribution Of Gas Standard Procedures Request for mains Review of request Planning and site survey Cost calculation Feasibility Payments Issuance of job card Execution of the job Commissioning advice Issuance of Circulars Booking of cost Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

If the case is for the extension of major mains and it is feasible then the case is included in the ANNUAL DEVELOPMENT PROGRAM’S PENDING file. 2 Cost Calculation: After receiving the survey proposal.Sui Southern Gas Company Limited Request for Mains: Request for mains extension in existing areas may be placed by:  District Governments  Parliamentarians  Residents Review of Request: The request will be review for the completion of documents.1 Planning and Site Survey: Survey is conducted by planning department in order to determine the work involved. Sales department ensures that area drawing is  Available  Not available If the area drawing is available then the case is forward to planning for the survey of site.40. The criteria for checking the feasibility of the case is fixed by the CABINET COMMITTEE ON ENERGY (CCE) are as under: PROVINCE  Punjab and Sindh  N.100.W. If the customer arranges the area drawing then the case forward to planning for site survey otherwise the case will not be further proceed.000  Rs. sales departments works out the estimated cost of the case according to the data provided by the planning department. Sales department forwards the case to planning department on Book No.P  Balouchistan CAPITAL COST PER CONSUMER  Rs.F. After performing the survey of the site. If the drawing is not available then sales department informs the customer to arrange the area drawing. planning department informs the sales department about the case on Book No.20.000  Rs. A list is prepared by the sales department on the basis of least cost method (projects are Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .000 If the case is falling under the above criteria then it is treated as feasible. Sales department checks that whether the extension is for major mains or minor mains.

Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . DCM accounts after studying the case forwards it to DM accounts whose job is to prepare the feasibility report. The list is then forwarded for the approval of the management. Letter from Sales department Preparation and approval of feasibility Letter to sales Department Step (a): Letter from sales department: Sales Department sends a request letter to finance department to carry out the financial feasibility of the project. After approval list is sent to finance department for the processing of job cards.SGM (Transmission & the project Distribution) CASE – I Feasibility Study: Following are the steps involved in the process of feasibility.SGM ( Customer Services) and approval of financial feasibility of . Approval of Project: The criterion for the approval of the project is as under: CASE – II PROJECT COST Less than or equal to 1 million More than 1 million Theses projects requires approval Theses projects are forwarded to from two SGMs finance department for the preparation . DGM Sales forwards the letter of request to GM Accounts.Sui Southern Gas Company Limited arranged in order of the least cost). Under this case an option will be given to the customer that the project may be processed through cost sharing / self-finance basis if they agree. which forward to DCM accounts. If the case is not falling under the above criteria and the capital cost per consumer is far exceeding CCE criteria then the case shall be treated as PAID MAINS.

Category of Connection Industrial / CNG connections in existing areas / new areas Impact on GDS after Allocating for Regulatory Return Irrespective of Impact Project Cost Project Cost is lees than Rs. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 100% cost of mains recovered from customer as non-refundable Partial Positive Negative Project Cost includes: Cost of Mains including DIRECT DEPARTMENTAL COST (DDC) Cost of CUSTOMER METER STATION (CMS) Cost of TOWN BORDER STATION (TBS) / PRESSURE REDUCING STATION (PRS) if dedicated to the customer After preparation of feasibility report the feasibility report requires approval from the management.1 million Policy 100% project cost financed by the company Full Positive 50% project financed by the customer refundable over 48 monthly installments with nominal interest. If the cost of project is less than or equal to 2. Step (c): Letter to Sales Department: After approval of feasibility report DSS issues a letter to sales department informing about the approval of the project and the amount to be received from the customer as refundable / non-refundable advance as per the policy of the company.Sui Southern Gas Company Limited Step (b): Preparation and Approval of Feasibility Study: DM accounts prepare a feasibility report. 50% project financed by the customer refundable over 48 monthly installments with nominal interest. And works out the whether the cost of project being financed by the company or the customer as per the mentioned policy of the company. DM accounts calculate the impact on Gas Development Surcharge (GDS).5 million then CFO has the authority to approve the case other wise the case shall be approved by the MD.1 million Project cost is more than Rs.

Commissioning Advice: The construction department sends a commissioning advice to sales department to inform that the area is now on gas. This circular is only issued in the case of major mains. Execution of Job: The job is executed with the involvement of Planning and Construction.Sui Southern Gas Company Limited Issuance of Job Card: The list is sent to finance department for the preparation of job cards. Job card is prepared and sent to sales department. Issue of Circulars: Sales department issues circulars to registered contractors stating that they can start the sales activities. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Sales department sends job card to planning for the execution of work. Booking of Cost: All executed job cards are sent to finance department along with all material requisitions and other coast details for the booking of cost of the scheme.

2. Reconciliation store stock loan balances with ledger balances for the more accuracy. in SSGC Head Office record of each store all location in company is controlled and checked for proper receipt and issue of items. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . And here we go in the detail of these stores by using tables. 4. Functions Performed By Company Stores: Major functions are performed by company includes:  Receipt of stores  Issuance of stores for Distribution Projects  Issuance of stores for Transmission Projects  Issuance of stores for Meter Plant Projects In order to fulfill these functions. maintain and control the records of every kind of stock/material placed in stores at different locations of company. Working: 1. company has several stores ate different locations. half yearly and annually. Checking of stores balances with ledger balances on ERP. All the items have a 9-digit index number. Purpose: To check the store balances. Preparation of reports of stores stock on quarterly. 5. Here. 3. Extracting stores balances in ERP.Sui Southern Gas Company Limited STORES SECTION The store is responsible for receiving. Checking of miscellaneous reports of stores balances for confirmation. keeping and sending all the necessary materials the company uses for its operations in various locations throughout the country.

Debit Adjustment Receiving Statement Local / Imports NFLOWS Voucher INFLOWS Return Vouchers STORE OUFLOWS Material Requisition Form Meter Requisition Form OUT Credit Adjustment Voucher Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited The following chart shows the different documents. which causes inflows and outflows from the stores.

SUKKUR DISTRICT SITE Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . QUETTA ST.Sui Southern Gas Company Limited MAJOR FUNCTIONS OF COMPANY COMPANY TRANSMISSIO N DISTRIBUTION METER PLANT DISTRIBUTION STORES DISTRIBU-TION STORE KARACHI SINDH QUETTA MAIN STORE SITE HYDERABAD SUKKUR QNGDP GULSHAN STORE NAWABSHAH LARKANA ST.STORE SITE ST. HYDERABAD ST.

Sui Southern Gas Company Limited Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

METER PLANT METER PLANT Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . SUKKUR IRBPC-HQ-DADU IRBPC-HQ –SHIKARPUR QPL(O&M)-SIBI QPL(O&M)-QUETTA CD-KHADEJI GRIEP PROJECT KHADEJI PIRKOH-SUI ST. KHADEJI DISTRICT KHI KHADEJI DISTRICT KHI TERMINAL METER PLANT STORES METER PLANT ST.Sui Southern Gas Company Limited TRANSMISSION STORES TRANSMISSION OPERATION STORE-KT HQ-III HYDERABAD HQ-II NAWABASHAH HQ-I.

When the receipt is received by the store section from the store department the store section check R/S number. Stores system is based on the following store documents: 1. received. MMP. Each item has been allotted index number according to the description and specification of material.g. Pen. PURPOSE OF STORE DOCUMENT 1.g.Sui Southern Gas Company Limited STORE DEALINGS Store accounting is based on meaning average basis. and balance) through ERP that the received material is present at store department or not. Adjustment Memo Store accounting is based on above store documents for generation of cost of material received of issued. 2nd 2 digits denote sub section e. the receipt is put into records. date of issue. Trans. After confirmation. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 3rd 3 digits denote serial no of item like as Printing Paper. 1st 2 digits denote main section to whom material is to be sent e. description. Finance in HO etc. Material Return Voucher 5. HO. Material Receiving Statement   Foreign Receiving Statement Local Receiving Statement 2. Material Receiving Statement: When the material is received in the store department by the supplier or the company the store department sends two receipts 1st for supplier or respected department and 2nd for store section for maintaining the record and controls it. Store index is based on seven digits having fields of 00/00/000. delivery challan / invoice no: Supplier name and address. Inter Store Stock Transfer 4. Pipes etc. index number. Material Requisition 3. If the material is supplied from abroad in that case the Foreign Receiving Statement is issued and in the case of local supplier the Local Receiving Statement is issued. units. That receipt is known as Material Receiving Statement. etc. and quantity (ordered.

The store section check that from which store department to which store department material is transferred along with the respected location code. store index number. account.Sui Southern Gas Company Limited 2. serial NO:. When it is received by the store department they send the voucher to the store section with the name of Material Return Voucher for the purpose of maintaining. date of issued material. store index number. company code. Inter Store Stock Transfer: Sometimes material is required for one store due to out of stock and that material is in access for another store department then needed department sent the requisite for material and then material will transfer from accessible point to out of stock point and receipt is to be sent to the store section for maintaining and controlling the account with the name of Inter Stores Stock Transfer. and quantity issued through ERP that the requisite material is issued from store department or not. index NO. date of transferring. organization unit and project code. store location code where from the material is issued. description. Material Requisition: When the store department issue the material to the user department according to user demand the receipt is send to the store section for informing that we issue that material to that user department in case of availability and approval of high level management. order number. organization code. description of material transferred. 4. and quantity returned through ERP that the Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . department name.. date of return. serial number. quantity required. That receipt known as Material Requisition.R NO. After confirmation the receipt is put into records. function. After confirmation the receipt is put into records. unit code and quantity transferred through ERP that the transferred material is in actual transferred from one store department to another store department. 3. After receiving that receipt the store department check the indenting department and particular of job. When it is received by the store section they check that from which location material is return. job number. Material Return Voucher: When the material is issued against the requisition sometimes material is not in use or unserviceable and the user department return that unserviceable material to the store department. And store section also check the issuing store code NO:. & date against which drawn. requisition serial NO:. M.

After correcting the mistake the store department sends a receipt to the store section with the name of Stores Adjustment Memo for updating changes. job number.Sui Southern Gas Company Limited returned material is correctly record or not by the store department. When the receipt is received by the store section they check date of changing. or others fro correct these mistake companies make a journal voucher (JV) and correct the mistake. Adjustment Memo: Sometimes during the entry we are doing mistake like wrong entry of index number. 5. store index no: job number. quantity. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . amount. After confirmation the receipt is put into records. invoice number. quantity and remarks for what purpose that adjustment memo made.

This section prepares the voucher for only tangible goods not for intangible goods (services). secure and smooth payment to the supplier timely and to gain the confidence of suppliers. payment system under go though some steps and procedures. capitalized or charge to revenue account. R&D (store) and the suppliers. In LO. the voucher will not be printed. The bill payments made under LO are classified into:    Revenue Job denoted by 11/TKT Stores Stocks Items denoted by 12/TKT Capital Job denoted by 13/TKT This section deals with material management department. The local order section entirely responsible for the payment of bills to various suppliers and vendors. This section is only responsible for make payment to the material suppliers. It is also the responsibility of LO to ensure that goods and services are recorded correctly i. The main object of LO is to make ensure. if the wrong data is punched in to the system.Sui Southern Gas Company Limited LOCAL ORDER The local order section is one of the most important section of finance department. It is the practice of LO to reconcile their Bankbook Record with LO-Day Book and with their register on monthly basis in addition to daily reconciliation. LO section does not go though the payment process if any of the required documents are missing just like.e. In this regard LO verifies invoices quantities and rates against Receiving Slip and Purchase Order (PO) and ensure that the authorized person has approved these. purchase order. LO section uses the Oracle application software to print a voucher after punching data into system. Functions of Local Order: The core function of the department is to arrange payments against purchase orders issued by the procurement department of Unit “A” & “C” in respect of the following purchases. receiving statement and the invoices. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . The advantage of this software is that.

Sui Southern Gas Company Limited LOCAL ORDER PROCESSING INTENDS TENDER ENQUIRY QUOTATION PURCHASE ORDER INVOICE RECEIVING STATEMENT APPROVAL CHEQUE CREATION PROGRESS Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

the tender process takes place. Receiving Statement: When the materials are received and checked. Purchase Order: After the bid selection and approval from top authorities. After the success of evaluation report. Invoice: Invoice is a bill. order number and the date on which material was received. Tender Enquiry: Once the requisition is submitted and approved by the GM of material management department. Purchase order comprises the quantity of material needed.      Procure Department. and the copy of purchase order is sent to these following departments. the purchase order is sent to supplier. the evaluation report and purchase order is prepared with five copies. Finance Department Supplier (Original) R&D Department Intender copy Evaluation report is prepared by analyzing the budget available for concerned department. date on which the order was placed and the date of delivery. which is prepared by supplier and sent to the customer for payment. Purchase order also comprises the name of supplier and purchase order number. Now it is the responsibility of material management department to purchase that item for concerned department. If any department needs any (item). receiving statement is prepared at R&D department (store) and sent to bill section. then the head of that department submit the requisition to material management department in order to purchase that thing. SSGCL issues the tenders for the purchasing of material through advertisement in newspapers. the order is placed through purchase order. All the potential and interested suppliers come forward and submit their quotations and bids. If the budget for concern department is available. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Receiving statement comprises amount of quantity. the price of material. Quotations are taken by three lowest bidders.Sui Southern Gas Company Limited LOCAL ORDER PROCESSING Intends: Intents or the requisition is received from concern Departmental head by the procurement department.

000. Receiving statement. Financial Powers: Previously payments up to Rs. purchase order and invoice items and amount are match and then data is punched in oracle based application system under the “invoice batches” head. 500. However.5% This is the income tax. Bank Guarantee: It is the practice of SSGC to obtain bank guarantee from the supplier where tender price exceeds Rs. 500. receiving statement and the invoices of the supplier are attached together and the process for the payment starts by preparing voucher.  Withholding tax @ 3. receiving statement. and Rs.01% is deducted for one day.000 with respect to purchase order. DGM. 200. After the approval of payment voucher. LO can deduct only up to 10% of payable amount even late delivery exceed the 100 days. 100. which is deducted from payable amount.000. this set of document is sent to cash and bank section for preparing cheque in favor of supplier. and then tax is given to tax department of Pakistan. delivery challan. A checklist is also prepared to make sure that all the formalities are compiled with.  Liquid Damage (LD) @ 0.000 required to be approved by DCM. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . and then the payment vouchers are checked and approved by the DCM. sales tax invoice and the evolution report. Other Activities in Local Order: LO section deducts few charges from the amount payable to suppliers. and GM if required. They are:  General Sales Tax @ 16% GST 16% is added into the payable amount. Deputy Managing (DMD) has approved revised financial powers.  GST withholding tax @ 20% on GST amount 20 % withholding tax is deducted from GST amount and then SSGC gives that amount to sales tax department.1% per day LD is deducted from payable amount if the delivery is late. invoices. DGM and GM respectively.Sui Southern Gas Company Limited Approval & Cheque Creation: Purchase order. 0. After the punching of data voucher is printed and attached with purchase order.

Dr.Sui Southern Gas Company Limited MIS Reporting: DCM submits report on monthly basis regarding details of bills received and processed during the month and detail of outstanding bills to DGM for further submission to GM and DMD. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . LO generalized receiving slip received and processed during the month by passing the following entry: Stores /Revenue / Capital Account Sales Tax-Adjustable Sundry Creditor Sundry Creditors Liquidated damages Income Tax Deducted at Source-Payable Dr. Cr. Generalization of Receiving Slip on Monthly Basis: At the end of each month. Dr. Cr. Cr.

Sui Southern Gas Company Limited STEPS TO PROCESS A PAYMENT VOUCHER Following are the required step involved to process PAYMENT VOUCHER in AP Module through System: 1. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Enter the batch name to open the entry. Open the invoice batches. 2.

Now we enter the following data:  Supplier No:  Invoice date  Receiving date  Invoice No:  GST No: After giving the following data. system allots the unique reference no.  Here reference no allot to the supplier. to the supplier.Sui Southern Gas Company Limited 3. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Now we click on “MATCH” to match the Purchase Order (PO) with the Receiving Statement.Sui Southern Gas Company Limited 4. 5. Now we add the GST. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Now we click on the “ACTIONS” to validate the entry and do the following actions:  Validate and force approval  Force approval and release hold  Create accounting Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .      Add general sales tax (GST) Deduct income tax 3. Now we click on the distributions and do the following transactions.Sui Southern Gas Company Limited 6.5% Minus liquid damage (LD) (If required) Add freight SED 1% (Special Excise Duty) Minus GST withholding 20% 7.

Sui Southern Gas Company Limited 8. 9. First we select the “LO PAYMENT VOUCHER” and then give following parameters. Now we click on “REQUESTS: SUBMIT” to submit a request and to print the voucher. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .  Batch name  Supplier name Then click on “SUBMIT” to run the report.

Sui Southern Gas Company Limited 10. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Now we click on “VIEW OUTPUT” to retrieve the voucher and then print it.

9. d. Fire Insurance Motor Vehicle Insurance Employees Benefit 5. 3. Correspondence with Surveyors. 4. ii. Passing Recurring JV of Fire Insurance and Motor Vehicle on Monthly basis. but in case of very huge volume of business like that of Sui Gas Southern Gas Company Limited. 10. dangers and risks. e. Renewal of Fire Insurance and other policies on Annual Basis. Payment of Debit Notes to NICL and Adamjee Insurance throughout the year. 8. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Preparing Budget of Insurance on Annual Basis of following: a. b. Preparing Reports for Management. c. f. Correspondence with other departments. Basically insurance cover is confirmed when premium is fully paid and POLICY is issued by the insurers. c. It has also been made compulsory by law in most of the countries to protect assets/property of Government concerns and corporate bodies. b. Fire Insurance Motor Vehicles Employees Benefit Group Insurance Personal Accident Marine Insurance EAR Insurance Casual / contract labor Insurance 2. a HOLD COVER letter from the insured is enough for confirmation of insurance cover. 6. Correspondence with NICL.Sui Southern Gas Company Limited Insurance Section In the present world. 7. insurance is essential to protect and compensate for sudden loss of life and property. Insurance coverage of All the Assets and Employees of SSGCL under: a. Responsibilities of Insurance Section: Following are the responsibilities of insurance section: 1. i. Lodging and settling of Insurance claims under above mentioned policies. where life is full of anxiety.

M. O. 6. Hand Held Computers Plant (Meter Plant) Including Building. G. 1. Voluntary insurance. Consequential Loss of Profit. Computers Including Lap Top. L. Badin Gas: Liquid Handling Facility. Q. Presently SSGC Fire Insurance Policy is taken from NICL Insurance Company. Erection all risk policy (EAR). Marine policy. Plant & Machinery at K. Fire policies. b) Personal accident policy. Stores. 2. earthquake (fire and shock). riot and strike damage etc. C. It provides protection against loss of gross profit incurred as a result of business interruption or interference in business caused by an event indemnifiable under fire and allied perils policy. hurricane).Sui Southern Gas Company Limited Kinds of Insurance Policies Maintained By SSGC: There are seven kinds of insurance policies which are maintained by SSGC are given below: 1. J. E. 5. Stores at Meter Plan. K. R. SCADA. I. NICL provides this coverage in conjunction with the fire. Gas Pipeline: Transmission and Distribution. a) Group life insurance. Compressors – Terrorism. flood. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 4. Fire Policies: It provides full comprehensive coverage in respect of “Loss or damage to property due to fire and lightening “. Following are the list of Fire Insurance Policies: A.V). Employees benefit policies. B. H. Accident policies. heat or combustion. D. LHF – Terrorim Buildings: other than Head Office Contents in Company's Premises including Head Office and other location Construction Equipment at Khadeji Buildings: Head Office Telecommunication. atmospheric disturbance (rain. Motor Vehicles policies (M. Gas Odorants. N. 7.T. F. Compressors. which can be extended to cover explosion. 3. P.

Sui Southern Gas Company Limited
2.

Accident Policies:

All the Accident policies are taken from NICL which are mentioned below:

a) Cash & Safe
Money insurance provides cover against loss of cash-in-safe and cash in transit caused by robbery, theft, or any fortuitous event; loss of money from the insured’s premises during business hours caused by theft or robbery; and loss of money from the insured’s safe or strong room caused by theft or robbery.

b) Director Pat Policy
Traveling inside the country or worldwide is an essential part of most of the executive’s working lives. Certainly, along with it comes the risk for any personal and financial loss that they might face on a business trip. This policy covers the employer and employees for any accident, sickness, and medical attention in an emergency that may occur whilst traveling.

c) Fidelity Guarantee
This policy covers the risk of employee’s embezzlement and misappropriation of cash and other assets of the company.

d) Workmen's Compensation
This is mandatory by law. As per law SSGC is bound to provide insurance cover to its contract employees.

e) Public Liability
This policy is obtained to reimburse loss sustained to assets of third party under possession of SSGCL.

3. Marine Policy:
Marine insurance policy covers the risk of imports and exports as per requirement of the organization. This policy can be extended to provide adequate cover to protect all goods in transit by other modes of transportation, viz., by Air, Rail & Road. Through insurance company the goods are protected from the time the goods leave the seller’s warehouse until they reach the buyer’s warehouse. The party usually responsible for insuring the goods is determined by the sales contract. To help the insured familiarize with the buyer’s and seller’s responsibilities. Presently SSGC Fire Insurance Policy is taken from NICL Insurance Company.

Policy Purchasing For Marine Insurance:
Proposal for insurance (request for insurance) is made by the procurement department direct to NIC. NIC issues certificates for each consignment proposed for insurance

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Sui Southern Gas Company Limited
and sends to insurance section along with a statement on monthly basis. This statement is sent to procurement department for verification/confirmation. On receipt of this confirmation, premium is paid by insurance section through a Cheque.

4. Motor Vehicles Policies (M.V):
Motor vehicle insurance policies provide coverage against accidental damage including fire, theft, snatching away by violent means, riot and strike damage, loss or damage due to natural calamities, road traffic act, and at common law, third party liability (Bodily, Injury and property damage). The policy can also be extended to include accidental personal injuries to and death of driver and passengers. Presently SSGC Motor Vehicle Policy is taken from NICL Insurance Company. Following are the list of Motor Vehicle Insurance Policies: A. B. C. D. E. Commercial Vehicles. Commercial Vehicles with Tracker. Private Vehicles. Private Vehicles with Tracker. Motor Cycles.

5. Employees Benefit Policies:
There are two types of policies are maintained under this group by SSGC:

a) Group life insurance
In Group Life Insurance, the organization can decide the benefits it wants for each employee. Sum Insured Can be a flat amount or a multiple of the salary. Premiums for Group Life Insurance are paid by the organization. Presently SSGC Group Life Policy is taken from American Life Insurance Company. Group insurance covers the natural death of SSGC employees. Family of deceased employee will be entitled for following claim. • • Sum Insured of Executives is One Annual Gross salary. Sum Insured of Non Executive is Rs. 20,000 for each employee.

b) Personal accident policy
In an increasingly competitive business scenario, every organization has to prepare for the unexpected. This implies not just to its property, but also the employees. An employer is responsible for the health and safety of all the employees while they are working in the organization. This insurance indemnifies the insured in case if at any time during the period of the insurance any employee during his service shall sustain personal injury by any accident.

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Sui Southern Gas Company Limited
Presently SSGC Personal Accident Policy is taken from Century Insurance Company. Personal Accident insurance covers the accidental death of SSGC employees. Family of deceased employee will be entitled for following claim. • Sum Insured of Executives is as per following slabs: Grade 1 to 3 4 to 5 6 to 7 8 to 9 MD Chairman Total NO. Executives 1628 343 97 31 1 1 2101 of Sum Rs. Insured 1,500,000 2,000,000 2,500,000 3,000,000 10,000,000 10,000,000

Sum Insured of Non-Executive employees is Rs.800,000 for each employee.

6. Erection All Risks Policy (EAR):
EAR provides coverage against all risks during:      The erection of machinery, plant and all kinds of steel structures Testing /trial run of new machinery Third party legal liability for loss of or damage to property and bodily injuries Expansion of an existing project. Dismantling and re-erection of an existing facility.

The interests of suppliers, manufacturers, contractors as well as subcontractors can be included in the policy. Cover the project site and terminates on completion of testing or handing over of the project to the principal or the period chosen, whichever is earlier. Presently SSGC Erection All Risk Policies are taken from NICL Insurance Company.

Policy Purchasing For EAR Insurance:
This policy is taken for projects. Specified proposal form is completed by P&C or P&D and sent to insurance section for getting insurance cover. After processing the required formalities, EAR policy is issued by NIC. This is one time cover till completion of Project and premium is charged for the entire period. 7.

Voluntary Insurance:

Voluntary Insurance has following features:     The plan is specifically designed for the organization. No direct cost to the organization as employer Each employee decides the level of cover they want. Involves minimal administration and paperwork.

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5) After completion of survey.  Copy of FIR where required. 6) Usual documents required are:  Claim Form: This form is completed and signed by department concerned and forwarded to finance for onward submission to the surveyors and insurers. The first step is taken by the location incharge who informs Finance either or through concerned G. Further steps to be taken are narrated below: 1) On receiving report of damage or loss.  Details of repair works. receipts etc. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 7) Documents are prepared and arranged by concerned department and are provided to finance for onward submission to surveyors/insurers. Process For The Claim of Insurance Policies: When there is a damage or loss. the surveyor asks Finance Dep’t. 2) Immediately.  Documents in support of expenses incurred such as cash memo. this file no will be the reference no. 8) Documents are prepared in duplicate sets one each for the Surveyors and the insurers. Presently SSGC Voluntary Insurance Policy is taken from New Hampshire Insurance Company. To provide documents. Insurance Section will enter the loss in Insurance Register and allot a file no.  Statement of loss. the Insurer allots their claim no.Sui Southern Gas Company Limited  Premiums are directly deducted from employee’s salary. 9) Insurance section always keeps strong and constant liaison with concerned department for arranging /preparing claim documents. On completion of claim document with the insurers.  Departmental Enquiry Report. 3) On receiving formal notice of claim.M.  Any other document as required by surveyors/insurers. Insurance keeps pursuing insurers for settlement. the process of insurance starts. (Reference no. A surveyor is also appointed at the same time by the Insurer. a formal notice of claim will be served upon the Insurers. of that claim for further process.) That will be their reference in future and till finalization. 4) Insurance Section makes liaison with the appointed surveyors and arrangements are made to take him to the place of survey in consultation and co-ordination with the concerned department.

Purchase Invoice. Bill Of Entry.R Department. 2. Copy of FIR 2. Claim Process For Marine Claims: Information for any shortage. Bill Of Lading. damage or missing in the consignment is reported to Insurance section by procurement department. A surveyor is appointed by the insurers who give his report upon which claim is paid by the insurance company. Death certificate.Further process is completed by Insurance Section in collaboration with IR department in case of unionized staff and with HR Department in case of executive staff. Proof of age. 6. Copy of post mortem report. 5. 4. following documents are required for settlement of marine claims: 1. notice of claim is served with the insurers by insurance section. Claim Process For EAR: Claim process for EAR losses/damages is the same like FIRE CLAIMS but voluntary excess is not applies rather Compulsory deduction is applied the amount of which differs from policy to policy. Damages up to 2% of C&F value is not claimed under voluntary excess.Sui Southern Gas Company Limited Documents Required In Case Of Group And Personal Accident Claims: 1. 2. the following documents are also required for accidental death claims: 1. Based on this information. Claim form: Completed and signed by I. In Case Of Accidental Death: In addition to the above mentioned documents. Documents Required For Marine Claims: Usually. 4. Physician’s statement. First information of incident ( either death or accidental injury ) may be given by the concerned location where the employee was working or may given by Medical Department or by IR/HR department . Photocopy of NIC of the deceased. Original Insurance Certificate First three documents are provided to insurance section by procurement department and insurance certificate is available with the section. Burial certificate.R. 3. 3. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . or H.

SSGC obtains endorsement by paying 50 percent of the proposed budgeted premium to NICL and the remaining amount is paid after finalization of financial statements. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . So in order to get insurance coverage of all the assets.Sui Southern Gas Company Limited Renewal Of Insurance Policies: SSGC’S all the insurance policies expire on 30th June and the renewal of the policies is done on 1ST July. As every year there is some change (increase or decrease) in the value of assets but the exact figure of this change can only be determined after finalization of financial statements.

Cr. Case II : Total loss of Asset I In case of total loss of asset. Dr. Cr. Dr. Cr. Cr. Cr. Cr.Sui Southern Gas Company Limited Accounting of Insurance Section Journal Entries: 1 Accounting for Prepaid Insurance I At the time of booking of prepaid premium: Prepaid Insurance Payable to Insurance Company (Through NLO) II At the time of payment of premium to Insurance company: Payable to Insurance Company (Through NLO) Cash / Bank II At the time of charging of prepaid Insurance expense: Insurance Expense Prepaid Insurance Dr. Payment to Workshop: Payable to Contractor / Workshop Cash / Bank II I At the time of Settlement of claim from Insurance company: Cash / Bank Recoverable From Insurance Company Dr. Dr. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Booking of Loss: Recoverable From Insurance Company Asset Dr. 2 Accounting for Insurance Claims Case I : Accident / damage of Asset I In case of Accident / damage to Vehicle. Booking of Loss: Recoverable From Insurance Company Payable to Contractor / Workshop II In case of Accident / damage to Vehicle. Dr. Cr.

Sui Southern Gas Company Limited II At the time of Settlement of claim from Insurance company: Cash / Bank Recoverable From Insurance Company Dr. Dr. II I At the time of payment of claim to the family of deceased: Payable to family of deceased. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . 3 Accounting for Death Claims I At the time of receiving Cheque from Insurance Company: Cash / Bank Recoverable From Insurance Company II At the time of booking payment: Recoverable from Insurance Company Payable to family of deceased. Cr. Cr. Cash / Bank Dr. Cr. Cr. Dr.

Sui Southern Gas Company Limited FLOW CHART FOR THE CLAIM OF INSURANCE POLICIES Concerned Department Send Notice of Loss to Insurance Section Insurance Section Inform NICL With in 15 Days From The Date Of The Loss Surveyor Performs the Survey of the Location And Send Insurance Section List Of Required Documents NICL Appoint Surveyor And Issue Claim Number Insurance Section Collects Documents From The Concerned Department And Submits It To The Surveyor Surveyor Submits The Survey Report To NICL Based On That Report NICL Settle The Claim NICL Deducts Rs. 20 Million Voluntary Excess on Each And Every Claim Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited FLOW CHART FOR THE RENEWAL OF INSURANCE POLICIES: All The Policies Expired On 30TH June Renewal Is Done On 1ST July 50% Premium From The Proposed Budget Is Paid To NICL All The Assets Are Endorsed From NICL All The Remaining Payments Are Paid According To The Schedules Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . Creating a New Invoice Batch Of Payment Voucher: 2. New Batch Is Created: Description Of Payment Voucher Through NLO: 3.Sui Southern Gas Company Limited Invoice Entry & Payment Cycle On Oracle 1.

Account Codes To Be Specified For Each Payment: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited 4.

Sui Southern Gas Company Limited 5. Validation Window For Authentication Of Payment: Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

Sui Southern Gas Company Limited RECOMMENDATION & SUGGESTIONS Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .

low cost and environment friendly natural gas within the reach of over 1. the company has made momentous progress and has brought the fruits of clean.e. 15 days after the delivery date of material to maintain the trust of suppliers on the company. The salaries of the contract employees are very low as compare to amount of work performed by them. Sufficient training of the human resource is very important. commercial and industrial customers all over Sindh and Baluchistan. SSGC needs to address various kinds of issues like some employees are under-valued. first out basis. Similarly some may be poorly motivated and consequently perform well below their true capability. Recommendation: It is recommended that training should be given to each employee periodically. Some times “Receiving Statement” comes late from stores because of in efficiency of the stores departments. ISSUE: It is observed that in Local Order (LO) Section payment of bills are delayed due to inefficiency of employees and no check and balance system is there. Following are the recommendations: 1. I observed that the contract employees are unfairly treated poorly motivated because of their dissatisfaction with pay and working conditions. Proper time frame should be followed for the payment of the bills i. Over the past 50 years. the company has emerged as a leading fully integrated utility company that continues to play a major role in fuelling national progress. so they would become acquainted and proficient with the ERP system that is implemented. Recommendation: The payment of invoices should be paid on first come. As a result. ment Issues: Manage During my internship. Delay in Bills Payment in Local Order Section: 2. some are under-trained. And sometimes some bills are processed first because of favoritism. Contract employees should given a chance to work on career basis. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 .Sui Southern Gas Company Limited SSGC is playing a leading role in the energy sector of Pakistan and is on its track of meeting its strategic goals and objectives. and some may be under utilized. Lack of Training: There is lack of training in some departments which create problem for employees to work on the ERP system.9 million domestic.

e. all internees should be paid stipend equitably. Recommendation: In my opinion the objective of any internship program should be to facilitate the learning of the internee. This creates question in the mind of internees about company policy for internees. Some of the employees of finance department of some sections are very cooperative while employees of some sections are non-cooperative like GL section. Some of the internees are paid stipend while some of them are not. hip Program: Stipend issue: Interns Company policy for MBA/BBA internees is rather unfair. Section incharge of each department should be directed to cooperate with internees. Issue: During my internship. If proper documentations are maintained then it may help in the understanding of the internees of the business processes as well as decrease the amount of interaction with employee. Company should have a same policy for all internees i. I interact with many employees.Sui Southern Gas Company Limited 3. Prepared By: AWAIS MAHMOOD INTERNSHIP REPORT Page 24 of 95 . provide an environment where he/she could implement and observe the practicality of the theories learned.

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