When procuring items needed for the conduct of research project, the items to be purchased will be procured by UP Manila’s offices in behalf of the project, following the regulations set forth by Republic Act No. 9184 “An Act Providing for the Modernization, Standardization and Regulation of the Procurement Activities of the Government and for other Purposes.” The project leader shall not use the cash advance he or she has on hand for these. The cash advance is only used for travel / transportation, representation, meals.
A research project needs to procure 10 pcs of laptops to conduct a national survey of a particular disease condition. What are the steps needed to be undertaken to effect the purchase?
First, let us first be familiar with the documents that are prepared for the procurement of materials needed for the conduct of a research project.
Q: What is the PPMP – Project Procurement Management Plan?
This is a document in tabular form showing the schedule as to when items needed by the project are to be procured. Items to be procured must be planned ahead of time and not procured at whim. This requires astute planning on the part of the project leader.
The PPMP must show that the electronic tablets are needed by June 2019, for example. Hence, this will serve as a guide as the when the procurement process must start. A lead time of 2 months minimum is usually observed.
Q: What is the PR – purchase request ?
A purchase request is prepared by RGAO to assist the research project in starting the procurement of a particular. This document is the first step to get approval of the procurement. The product is not yet being purchased, but we are just getting approval for it. The PR must contain the following information: research project that needs the item, detailed specifications of the item, quantity of the item, and the budgeted price of the item. It is best practice not to place the brand of the item but just the details of the specifications. If a certain brand is required, this must be properly justified. RGAO would then forward the PR to the Accounting Department to ensure availability of funds, and to the Procurement Office for the proper mode of procurement. Only then will this be given approval.
Going back to our case, the purchase request should contain the name of the research project, the item (laptop), the specifications (size, memory, operating system, capabilities), quantity (10 pcs), budgeted price (P25,000).
Q: What is the PO – Purchase Order ?
The purchase order (PO) is prepared once a PR has been given approval. The PO is the document that is sent to a supplier by the purchasing entity confirming an order for items or services to be procured. The supplier to be chosen is the one who has the most competitive price who can deliver the items specified. The PO includes the name of the research project needing the item, the vendor, the description and quantity of the goods or services, the price, date of delivery or performance, payment information, and delivery address.
Going back to our case, the PO should contain the name of the research project, the vendor (Electronics Supplies, Inc.), the item (laptop), the specifications, quantity (10 pcs), purchase price (P24,000), date of delivery (within 15 days from acceptance of the purchase order), payment information (check payment within 30 days from delivery), delivery address (547 Pedro Gil St.).
Q: What is a DV – disbursement voucher ?
Upon delivery of the purchased item, the supplier will provide an invoice and have the accepting office sign a delivery receipt. The invoice represents the supplier’s request for payment from the purchaser. The DV is a form used to have a check made representing the purchaser’s payment to the supplier for the items delivered or services rendered.
Going back to our case, the needed 10 pcs of laptops have been delivered. These have been inspected and found to be appropriate. The supplier has provided an invoice and the accepting office has signed the delivery receipt. A disbursement voucher is then prepared resulting in a check from the account of UP Manila payable to Electronics Supplies, Inc. with the amount of P240,000.
Common Problems Encountered in the Procurement Process
- The items to be purchased as listed in the PPMP do not match the items in the line item budget.
The items listed in the PPMP will be counterchecked with those listed in the LIB to ensure that proper funds have been budgeted for the various items to be procured. There are instances when the project staff have not properly prepared the line item budget (LIB) and PPMP.
For example, the PPMP shows that a statistical software has to be procured. However, the LIB does not contain this item.
Q: How can this scenario be prevented?
A: Proper planning must be done in the preparation of the LIB and PPMP. The items to be procured as listed in the PPMP must have been budgeted corresponding amounts as stated in the LIB.
- Failure to know the prevailing market price of items to be purchased
The purchase request stated that the study has set a budget in the amount of P25,000 per piece of the electronic tablet. During the bidding process, there were no offers from any supplier and the bidding failed. This is because no supplier can sell the items at that low price since the prevailing market price is at P28,000.
Q: How can the failure of bidding in this scenario been prevented?
A: The project leader must first have an idea of the prevailing market price of the items they need to procure. To allow for inflation and increase in market prices, the amount in the budget can be increased by approximately 10%. If the market price is P28,000, the budget for the item can be placed at P30,800 thereabouts.
3. Failure to provide the details of the product specifications.
The purchase request and purchase order missed an important detail in the product specification. This resulted in the software to be used in the national survey not compatible with the procured laptops.
Q: How can this be avoided?
A: The purchase request must contain the details of the product specifications to conform to the requirements of the research project.