Purchase Order:

A demand request (PR) initiates from Mill/Plant by purchaser, against that PR

purchase manager raises the purchase order in oracle purchasing. Once the
Purchase Order gets approved by the authorities, marketing/import department
receives the Performa invoice. Insurance will be paid at the time of Purchase order
creation. Insurance will be taken care by finance/Account department.
Following are the Purchaser for different item categories

Mr. Buland Akhter raises the PO for Stores & Spares, Dyes & Chemical.
Mr Isfand Yaar Ali / Zahid Sohail raises the PO for Accessories.
Mr. Junaid Amjad / Syed Muhammad Farrukh raises the PO for Yarn.
Mr. Zafar Mehmod raises the PO for Cotton.

Performa Invoice:
An invoice sent by seller to a buyer in advance of shipment or delivery of goods. It
has a description of purchased item, quantity as well as other important information
like HS Code, INCO terms, payment terms, mode of shipment, origin and destination
port, weight, remarks and commission agency.

Payment Terms: Advance Payment or credit. Charge nature will be changed in

every payment term.
HS codes: This is internationally recognized imported item description on
which duties and taxes are applied but it can be changed based on country
and region.

Following are the INCO term which will apply on shipment.

1. C&F basis means that the price will include cost and freight but insurance will
be borne by the buyer.
2. CIF basis means cost, insurance and freight will be part of invoice and buyer
will not pay it.
3. FOB basis means that the responsibility of the seller for goods will last till the
sellers port and all other charges will be borne by the buyer.
4. Ex-Factory (mostly in case of local buying) is a term in which buyer bears all
the charges from the sellers warehouse/manufacturing facility to its
warehouse.
LC Opening:
Once the proforma invoice received. Import dept. will contact the bank for LC
opening/TT opening. Bank charges the commission for opening LC/TT document. In
case of LC/TT original document is not yet received or any amendments require in
LC then bank will charge the commission. LC will be established by import
department with consultation by finance department TT will be taken care by
finance department and Payment will be created by finance department. LC will be
closed once the all charges are expense out but accounting will be run on month
basis. Single account maintained for LC (i.e., LC Control Account). At the time of

cost update this account will be credit and at the time of invoice this account
will debit.
For TT Advance,
SRO:

SRO is statutory regulatory order, normally issued by FBR which create and
enforce industry regulations and standards. NCL are practicing following SRO for
getting benefits in imports.
SRO 327
When goods are arrived at port then some charges are applied which will be
refundable after a period of time. That cost will not become part of item cost.
Spinning 1 Periodic and HTD Division are two organizations which have SRO
based purchases.
This SRO is applied on Manufactured RM items, Import & Export items. PDC given
to Govt. on account of tax and duty which will be refund after 2 years at the time of
audit.
SRO 492
This SRO is applied on trading items like packing items. PDC given to Govt. on
account of tax and duty which will be refund after 2 years at the time of audit.
SRO 1125
This is SRO is applied when SRO-327 is not avail for any reason. This SRO gives
benefits on reduction of sale tax, withholding tax.
8th schedule sale tax (SRO 727)
This SRO is applied on machinery import items.
As of now there is no implication in system for capturing SRO details. It is manual
excel sheet process, when goods arrived on port then import department manager
decides which SRO will be apply for shipment. Clearing agent will file the papers
behalf of NCL in order to release goods from port.
PDC cheaques submitted against SRO which will be return after 2 years. This will not
become part of item cost.