Hubbell Policies

• Preparing procedures and inventory instructions assigning responsibilities and target dates for personnel in order to ensure completion of the physical inventory count at a minimal cost and at minimal interruption to the operation. • General supervision of the annual physical inventory count to ensure that all instructions have been implemented, including those related to preliminary planning, conducting the count, evaluating the results of the count, and recording the count adjustment in the perpetual records and the general ledger.

Preliminary Planning:

Written instructions in the form of an inventory manual or standard operating procedure should be prepared by the BU Controller in advance of the inventory date. Instructions should give consideration to the following:

1) Physical Inventory Count Forms/Tags:

1) Inventory Tags – The inventory tag can either be consecutively pre-numbered or a consecutive number assigned during the printing process. The tag should be in two parts and/or include a stub to remain with the item being counted. The minimum information included on each tag is as follows: • Counted by (individuals name/initials who performed the count) • Part number (SAP part number or system identifier of the item being counted) • Description (description of the item being counted) • Quantity and Unit of Measure • Location (SAP storage location/description of area where material is located) 2) Pre-Count Tags - To minimize the interruption to Operations for taking the inventory count, as much inventory as practical is pre-counted and quantities recorded on pre-count tags. Pre- count tags should indicate quantities, part numbers, dates counted and quantity adjustments.

Tests of counting accuracy will be increased in those areas where high amounts of pre-counting is done. This must be done to insure pre-count accuracy.

3)Tag Control and Release Forms - Inventory tags are controlled by area. The employee to whom the tags are issued signs a receipt acknowledging the receipt of the tags. A tag release form is an authorization to remove tags from the specific sections where the physical inventory is completed. The form should be designed to indicate the section releases and contain a space for the signatures of personnel authorized to issue the release.

B. Plant Layout

Instructions should include a plant layout outlining the inventory areas based on the physical layout of the plant, the flow of materials, the types of operations, the amount of material to be inventoried and the maximum practical area for effective control.

C. Equipment

The inventory supervisor shall have responsibility for determining equipment requirements, such as scales, lifts trucks, etc. Scales are to be calibrated before the inventory commences and tested periodically during the inventory.

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