Control Guidance on:

Material Flow Reconciliation

in Cement Activity

- June 2012 -

1
 Before start
 Volume reconciliation is often identified as an area to improve in many
Countries based on internal assessment & external audit.
 The Group Internal Control and Group Finance Control department
have designed this document on controls over material flows in the
cement activity to help improve Lafarge ability to manage volume
reconciliation and will cover:
 material flow in a cement activity and associated risks and controls
 how to set up a monitoring process
 frequently encountered issues

 The following concepts are discussed :

 Raw material storage, stock take and stock adjustment
 Consumption, Production, Dispatching flows
 Maintenance and calibration of measuring instrument
 Production reconciliation

 Training will be organized by Group Internal Control and Group Control

to the Country Internal Control team, also to the finance team and
business process owners.

2
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch

 What are the controls on material flow

 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

3
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch

 What are the controls on material flow

 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

4
Analyze the Material Flow
Manufacturing

!
Dispatch
!
Cement,
Additives

!
Clinker, fuel

!
Raw mill

5
 Analyze the Material Flow
Manufacturing

Quarry to the first crusher

 Major stock item: Lime stone and clay
 Stock owner: Quarry manager
 Measurement not precise:
 Transport by Trucks from quarry + Weighbridge at
plant
 Transport
by conveyer + Weigh feeder under the
conveyer after the first crusher
 Challenges for control :
 Lack of control due to sub-contracted quarry
activities or distance of quarry
 Risk of theft due to lack of security etc.

Weigh feeder under the conveyer Risk linked with volume reconciliation:
Low stock value, difficult to move
Low the materials
6
 Analyze the Material Flow
Manufacturing Prehomogenization* & Raw mill
 Major stock item: Crushed limestone, pyrite,
silica, clay, Iron ore
 Stock owner: Production manager
 Measurement
 Stock take of piles: volume measured by total
station * density determined by Lab
 Receiving of purchased material: Weighbridge
 Consumption:
 Pressure with pneumatic conveying
system  ton/hour
 Bucket elevator ton/hour
 Weigh feeders
 Challenges for control:
Weighbridge
 Reliabilityof measurement equipments:
maintenance and calibration
 Consistency of production ratios over a period or
between the ratios
 Pile storage condition
 Quality and quantity control at receiving

Weigh
Bucket elevator feeder
Risk linked with volume reconciliation:
High value of some additive materials,
* Not in all the plants
Medium theft, fraud on quality control, collusion with
7
supplier
 Analyze the Material Flow
Manufacturing
Clinker production
 Major stock item: Raw meal, clinker, fuel (coal)
 Stock owner: Production manager
 Measurement
 Receiving of purchased material: Weighbridge
 Consumption:
 Bucket elevator and weigh feeders ton/hour
 Clinker production can not be easily measured. It is
calculated with production ton/hour
• Clinker (t/h) = Raw meal (t/h) * 0.55~0.65 (lab)
 Challenges for control
 Consistency of production ratios over a period or
Good Practice
between the ratios
Objective : test the reliability of  Reliability of laboratory ratios (moisture, density …)
clinker production hour rate
 Monitoring of material movement (night reception,
Practice : Clinker production count
12/24 hours by truck + weighbridge transfer)
Suggested frequency : once per
year
Risk linked with volume reconciliation:
High stock value (e.g. coal)
theft, fraud on quality control, collusion with
High supplier 8
 Analyze the Material Flow
Manufacturing
Cement production
 Major stock item
 Clinker,
gypsum, slag, cement in silo, cement in bag,
packaging material (pallets, bags)
 Stock owner
 Production/Dispatching manager
 Measure method
 Weighbridge for receiving (e.g. slag)
 Weigh feeders under conveyor
 Calculate cement production ton/hour
• Cement production (t/h) = Clinker (t/h) + Additives (t/h)
 Stock pile : volume measurement * density
 Cement silo : drop rope
 Bag, pallets : count
 Challenges for control
 Relevance of production rate
 Reliability of measurement equipments: maintenance
and calibration

Risk linked with volume High stock value, risk of theft

reconciliation:
High (cement, bags …)

9
 Analyze the Material Flow
Transfer, Reception at depot and Dispatch
silos

dispatch
bags

Transfer, Reception at depot and Dispatch

 Major Stock item  Challenges for control
 Cement (bulk & bag), Clinker transferred by  Frequent
receptions in some depots (esp.
trucks, train or boat when receiving per invoiced volume)
 Stock owner • Plant dispatch vs. Receiving at depot
 Logistics/Sales/Supply  Coherence of dispatching quantities
chain manager/terminal
operator
• Delivery notes vs. Weighing tickets
• Shipped vs. delivered
 Measure method  Sub-contracting of transport, terminal
 Weigh feeders, Weighbridge, count (truck /cargo)  contract clause, monitoring of operations
 Typical flows  Physical distance of terminals implying less
 Plant dispatch to Customer (Lafarge delivery or supervision
customer pick up)  Night operations and manual operations
 Receive (purchased) cement and clinker for sales  Reliability of information (e.g. lack of
(plant or depot) interface between weighbridge, dispatch and
 Plant transfer to depot and dispatch from depot ERP)

Risk linked with volume High stock value, risk of theft

High (cement, bags …), high turnover
reconciliation: 10
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch
 What are the controls on material flow
 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

11
 Material flow controls 1/6
Controls embedded in operations
Receiving
(raw materials: lime stone, marl, silica, iron ore, gypsum, slag, coal …)

• Measurement: measured data used for receiving

• Weighbridge reliability: maintenance, calibration; ability of the system to control material flow
• Quality control: moisture rate, systematic or by sampling
• Recording : timely and accurately?
Consumption Dispatch (clinker, cement …)
(raw materials, work in progress)

• Weighbridge reliability
• Weigh feeder reliability
• Quality : moisture rate, systematic or by
sampling

Production
(mid-products, cement bulk/bag)

• Weigh feeder reliability (maintenance and

calibration)
• Monitoring of additive Ratios
• Stock take by production shift (cement silo)
• Production Data Reconciliation (PDR)
Each operational department (stock owner) is responsible of these controls at ongoing basis 12
 Material flow controls 2/6
Controls to set up to monitor process

Obtain data

Rely on • Data from measuring instruments Investigate &

original of production implement
data • Production reports, Maintenance
source corrective actions
reports
Ensure • Physical stock take reports Perform • Meeting to
Consistency • ERP system extraction tests * Investigate
• Dispatch, Sales reports inconsistencies : stock
• Financial reporting • Automatio owners (Production,
n dispatching, Sales) +
Finance, IT …
• Integrate
• Formalize action plan
Organize stock take to
and track
managem • Adjustment on stock
ent report
• Daily, Monthly, by Production • Manual if applicable
• Yearly, led by Finance
• Survey by 3rd party expert

Each operational department (stock owner) is responsible of these controls at ongoing basis.
Finance department participates at the closing period for a more in depth control.

* See next slide 13

 Material flow controls 3/6
Tests for material flow control
 Theoretical stock vs. physical stock
Stock0 + Receiving - consumptions = Stock1
Sum up
Physical Sum up Physical stock
consumptions
stock take GRNs take current
from production
Or system period
last period reports
receiving
records

 Produced cement vs. consumed clinker

 Σ ( Clinker consumption by type of cement * C/K ratio ) = cement production
 Consumptions of clinker + additives = Cement production

 Produced clinker vs. consumed fuel

 Clinker production (t) * Specific Heat Consumption (GJ/t) = Fuel consumed (t) * Fuel heat
value (GJ/t) / Fuel mix (%)

 Production report vs. measuring instrument report (IP21 e.g.)

 Coherence tests on production ratios
 Transfer: dispatched from site1 vs. received at site2
 Dispatching of produced = Total sold – Purchased for sales
 Inventory in accounting book vs. inventory in site reports

• Specific approach (Internal Control): Focus on risky areas, expensive materials

• Global approach (ref. CDP) : reconciliation of total quantities and value for all cement sites 14
 Material flow controls 4/6
Some reconciliations in Cement Package
 Cement Package (CDP) reconciles main stock items (Cement, clinker,
fuel) on volume and on financial value
Item Referred Equation Alert on inconsistency

Production = Sales - Purchase – Inventory  volume (kt),  % : Sheet “DataEntry”, row 982
Cement volume* Movement Impact on variance analysis (€): sheet “Variance”, row 266

Production = Sales - Purchase - Inventory  volume (kt),  % : Sheet “DataEntry”, row 986
Clinker volume* Movement + Cement Production/ CK ratio Impact on variance analysis (€): sheet “Variance”, row 267
Inventory Movement variable cost in P&L =
Inventory Produced clinker stock increase * variable
movement cost of clinker /t + Produced cement stock Impact on variance analysis (€): sheet “Variance”, row 263
variable part (€) in
increase * average manufacturing variable
P&L**
Cost for domestic sales except clinker
Average Specific Heat Cost (€/GJ) = Fuel
Cost in P&L (€) / Clinker production (t) /  Specific Heat Cost (€/GJ): Sheet “DataEntry”, row 990
Fuel
Specific Heat Consumption by ton of clinker Impact on variance analysis (€): sheet “Variance”, row 182
(GJ/t)

* Inventory of Purchased Cement, Clinker, Raw materials does not participate to the variance analysis (P&L) in CDP. Therefore,
reconciliation performed by CDP is ONLY based on Produced volumes. Please interpret “Cement sales volume” as “Sales volume of
produced cement” etc. 15
** There can be an inconsistency if the increase of stock is linked with a new product.
 Material flow controls 5/6
Some reconciliations in Cement Package
 Cement Package (CDP) provides automatic check on the coherence of
some KPIs
 Refer to the color alerts (black, red, orange) according to significance of
inconsistencies
In “DataEntry” sheet

Coherence of Ratio thorough several periods Check whether it is realistic

C/K ratio : row 125

Specific Heat Consumption (GJ/t) : row 130
Average Specific Heat Cost (€/GJ): row 131
Stock of Produced Clinker (t) : row 126
Unit Cost and contributions per ton of production
(€/t): rows 1501 to 1513 Stock of Produced Cement (t): row 127

Variable cost of raw materials in our products (slag,

clinker supplies, cement grinding suppliers, fly ash,
pozzolan, packaging) (€/t) : row 336 to 341

16
 Material flow controls 6/6 Internal Control Standards
ICS code Control Risk

Physical storage protection and

IN-C080 Physical storage conditions are not adequate.
organization
IN-C110 Stocktaking processing and documentation Stocktaking results are not reliable because of weaknesses in the process
Review of reconciliation book to physical Discrepancies are not properly recorded in the books, reasons for these
IN-C120
and approval of inventory adjustments discrepancies are not identified and related action plan is not implemented
IN-C150 Returned goods recording Returned finished goods are not properly recorded
IN-C160 Approval of stock issues and transfers Stock movements are not properly authorized
Stock movements (raw material, spare parts and finished goods, except sales) are
IN-C170 Inventory cut-off
not recorded properly and in the proper period (inaccurate cut-off)
Not used production or maintenance supplies bought through direct purchase are
IN-C180 Completeness of inventory records
not reintegrated in stock
IN-C190 Volumes reconciliation Stocktaking results are not reliable because of weaknesses in the process
Transfer of raw material, semi-finished, finished goods and spare parts are not
IN-C200 Recording of intraco stock transfers
properly recorded (leading to fraud, loss of stock and incorrect volume data)
Reconciliation of Inventory ledger with
IN-C205 Postings into Inventory ledger are incorrect
upstream systems
RV-C250 Shipment authorization Unauthorized shipments are made
Sales to personnel, free of charge goods, Sales to personnel, free of charge goods and internal consumption of goods are not
RV-C260
internal consumption authorized and recorded properly
Reconciliation of shipped volume (delivery Actual quantities of goods shipped do not match with quantities booked in the sales
RV-C280
notes) with measured volume records
RV-C290 Measurement of equipment calibration Physical quantities are not accurately weighted
RV-C300 Missing manual delivery notes Deliveries are not accurately recorded (leading to inaccurate invoicing and/or fraud)
RV-C310 Review of GDN exceptions Deliveries are not accurately recorded (leading to inaccurate invoicing and/or fraud)
RV-C320 Right to load/return products Unauthorized transporter/customer can take our products (theft, fraud)
XP-C240 Cut-off of purchasing receipts Goods and service receipts are not booked in the correct period
XP-C250 Incoming goods inspection Goods received do not meet PO quantity or quality specifications

17
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch
 What are the controls on material flow
 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

18
 Establish the process of material flow control:
Step 1 : Have a full picture of flows and identify risky areas

 Have a full picture (a walkthrough) of the different material flows in

the activity
 Identify permanent and occasional flows (e.g. night shift)
 Identify different measuring method and equipment used
 Understand the importance of the flow (value, turnover quantity…)
 Highlight manual operations (e.g. manual recording of shipping
documents, visual counting of bag cement etc.)

 Evaluate the reliability of information flow and identify risky areas and
key materials
 Rational evaluation from experience
 Test *

* See previous slide “Tests suggested for material flow control” 19

 Establish the process of material flow control:
Step 2 : Implement a monitoring (reconciliation) process

 Implement the process

 Agree on the method and frequency of reconciliation practices
 Put into operating procedure
 Set up a reporting system at different level
 Define KPIs at different reporting level
 Perform periodical independent checks

20
 Roles of business process owners on Internal
Control
 BPOs (Business Process Owner) or Stock owners design the
controls to be implemented, perform reconciliation as per defined
frequency and method, investigate and implement corrective
action
• Manufacturing : Quarry, Production, Process managers
• Dispatching & Transfer : Logistic, Dispatching managers
• Annual stock take : Finance manager

 Internal Control team coordinate the design of control,

reconciliation activities, organize control documentation and tests
 Control the quality of documentation and tests performed by BPOs
 Perform independent reconciliation tests on risky items

 It is the responsibility of the Management to ensure the level of

internal control in operations.

21
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch
 What are the controls on material flow
 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

22
Frequently encountered issues and Good practices
1/3 Frequency, Density, Moisture, Off-spec, Tolerance rate
 Frequency of stock take
 Comply with Group guidelines and instructions
 Consider local ability and added-value
 Density and moisture
 Dry quantity must be displayed in the system
 Reconciliation based on dry quantity (recommendation)
 Difficult to systematically measure all materials before the stock take
• Practice : Test when big variance occurs
 Off-spec semi-finished or finished products (Clinker e.g.)
 Risk of distortion of unit cost of production, lack of visibility to the quantity
of product with poor quality and late reactions
 Off-spec product should not be recorded as production.
 Tolerance rate
 Depends on the specificity of the pile : Volume, storage condition,
turnover, type of material
 Practice : observe the evolution of stock take variances and set up the
tolerances

23
Frequently encountered issues and Good
practices 2/3 Adjustment after the stock take
Situation Accounting Solution
• Variance occurred during the current year
• Mid-product & processed materials (raw Adjust Consumption
meal, fuel mix ...) or Production

• Poor certitude on the figures

• Uncertain reliability of measurement, Make no adjustment
small variance based on big stock volume
• Variance from previous years
• Variance of current year with specific Adjust stock level
cause confirmed (physical damage, (write-off)
disposal due to quality issue, fraud theft
losses…)
Decision must be based on an evaluation of reliability and
certitude on the different figures.

That means the following analysis are done:

- investigation of operations
- Consistency check across different materials and different
data source
24
 Frequently encountered issues and Good
practices 3/3 Good practices
 Plant manager’s involvement
 Manage by small piles at the storage yard
 Advantage : frequent zero stock

 Tracking of bag consumption

 Clinker production: 12/24hour clinker production test to ensure a
reliable Raw meal/clinker rate

25
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch
 What are the controls on material flow
 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

26
 Group Referential documents and projects

 Group Internal Control Standards

 Group Guidelines :
 INV03 Physical Inventory
 INV04 Production Data Reconciliation

 “LO Portal – Internal Control – Library – Guidelines and IC tools – Inventory”

 Procedures:
 Treatment for Off-Spec clinker in Accounting and Performance
measurement (Cement Control, 2010)

27
 Index

 What is material flow

 Manufacturing
 Transfer, Reception and Dispatch
 What are the controls on material flow
 Controls embedded in operations
 Controls to set up to monitor process
 Reconciliation Tests
 Reconciliation performed in Cement Package
 Internal Control Standards

 Establish the process of material flow control

 Investigation and Risk Assessment
 Implementation of a Monitoring Process
 Roles and Responsibility of Control

 Frequently encountered issues & Good Practices

 Stock take frequency, Tolerance rate, Adjustment, Density and moisture

 Group Reference documents

 Annex :
 Group guidelines, examples of tests, Group Audit approach, findings, pictures

28
 Annex

 Risks frequently identified in Group Audit missions

 Group Audit approach on material flow
 Examples of some reconciliation tests :
 Coherence of additive ratios
 Evolution of % of stock take differences

 Frequency of controls + Extract of Group guidelines

 Photo gallery

29
The End

30
Annex : Main Group audit findings and risks –
Material Flow Reconciliation ( 9 BUs in 2010)
• Frequency, Method
• Lack of reconciliation check, or no corrective action
Improper stock take • Lack of control on stock adjustment

Ineffective control on • Poor/no use of weighbridge

material flow • Lack of reconciliation on GRN, GDNs
operations • Insufficient independent check
(Dispatch, Receiving)
• Stock take, Reconciliation, DOA stock adjustment
Control not well • Lack of procedure, or procedure not respected
defined in processes
• SOD conflict
and not enforced

IS/IT systems not
supporting effective
control of operation
• Inefficient Interface
• Reconciliation & control report not used
• Manual operations bypassing system
• Modifiable weighbridge, batching

• Separation of materials
Physical storage • Access security

Risks
•unreliable data from operation system
•reporting not aligned with reality
•fraud due to lack of control
•asset security, damage and concrete quality
•poor utilization of resources

Source: LGA data compiled for reporting and feedback. Analysis and ratio (%) based on 9 BUs audited in 2010 31
 Annex: Group Audit Approach on Material flow
Actors: Finance/Stock owners Actors: Finance/Purchasing
Doc: Count sheet, calculation sheet Doc: Call for tender documents
Survey reports, reconciliation reports Validation per DOA

unexplained Stock take Disposal

(physical stock)

Audit approach
Recurring Questions Return
 Basic data reliable?
 Measure equipment / method Actors: Sales admin./Dispatch/Logistics
Actors : Purchasing/Warehouse/Logistic  Report data consistent? Doc: GDN
Doc : GRN  Information flow
 Under control?
 Reconciliation done independently
Receiving  Gap investigated and resulted in
action plan

Approach:
 Test reconciliation Dispatch
 Stress on manual operations
Actors: Sales admin./Dispatch/Logistics
Doc: GDN

Issuing Production
(spare parts or other suppliers) (Consumption & production)

Actors: Warehouse Actors: Production/Process

Doc: Issue slip, work order Doc: Daily production report, month end PDR (Cement)
Batching report, monthly summary report (A&C)

Source: LGA Inventory process Audit Guide 32

Annex: Test on coherence of production ratio
Date Cement produced Gypsum used % Gypsum
5/1/2008 14 152 392 2.8%
5/2/2008 13 898 349 2.5%
5/3/2008 10 548 382 3.6%
5/4/2008 12 043 276 2.3%
5/5/2008 13 950 376 2.7%
5/6/2008 4 910 233 4.7%
5/7/2008 9 374 335 3.6%
5/8/2008 13 444 384 2.9%
5/9/2008 11 117 390 3.5%
5/10/2008 13 303 367 2.8%
5/11/2008 14 997 343 2.3%
5/12/2008 12 815 340 2.7%
5/13/2008 9 276 378 4.1%
5/14/2008 14 133 470 3.3%
5/15/2008 14 783 272 1.8%
Date Cement produced Clinker used Cement/Clinker Clinker/Cement
5/1/2008 14 152 11 421 1.24 80.7%
5/2/2008 13 898 11 260 1.23 81.0%
5/3/2008 10 548 8 595 1.23 81.5%
5/4/2008 12 043 9 731 1.24 80.8%
5/5/2008 13 950 11 367 1.23 81.5%
5/6/2008 4 910 4 070 1.21 82.9%
5/7/2008 9 374 7 596 1.23 81.0%
5/8/2008 13 444 10 949 1.23 81.4%
5/9/2008 11 117 9 154 1.21 82.3%
5/10/2008 13 303 10 752 1.24 80.8%
5/11/2008 14 997 12 102 1.24 80.7%
5/12/2008 12 815 10 236 1.25 79.9%
5/13/2008 9 276 7 296 1.27 78.7%
5/14/2008 14 133 11 073 1.28 78.3%
5/15/2008 14 783 11 717 1.26 79.3%

Sample information 33
Annex: Challenge Production report with
mesured data

Sample information 34
Annex: Analyze on monthly evolution of stock
take discrepancy (set up of tolerance rate)

Sample information 35
 Annex: Required frequency for some operational
controls on inventory
 Production data reconciliation
Monthly  Cement bulk materials: stock take by Production
 Aggregates sales-production balance meeting: sales & production forecast update

 Independent stock take (incl. cycle count) by non-stock owner (e.g. Finance)
 Cycle count scope completeness with site manager validation
 Zero stock (*)
 Consigned stocks evaluation and reconciliation

 Aggregates: physical measurement done by external surveyor

 Cement and Gypsum bulk materials:
• Stock take with visual assessment by Quality manager
Yearly
• 3rd party physical inventory
 Spare parts:
• verify classification, fixed asset vs. inventory
• Review of damaged, excess, “order on request”
• Verify codification

 Cement bulk materials: Stock take by non-production (independent person):

quarterly
Other  Review spare parts Min. Max. level: every 3-5 years depending on materiality
 Capitalization of spare parts : on-going basis

(*) recommended by Group guidelines

Source : Group Guideline INV01A, INV04, IAS inventory implemented process in each division

36
 Annex: Required frequencies : IN-C070, INV03

PDR : Production Data reconciliation

37
Annex: Required frequencies : INV03

38
Annex: Required frequencies : INV04

39
Annex: Required frequencies : Group Accounting
Standards (IAS) – Implementation by division

40
Annex: Gallery

Raw mill

41