Abstract
The aim of the study is to demonstrate how best a municipal stock control can be applied in conformity with strategic requirements of the Chartered Institute of Management Accounting (CIMA). A quantitative research method was applied. The questionnaire was formulated based on information obtained from the literature, and was distributed to only one KwaZulu-Natal (KZN) local government department. The sample consisted of 82 respondents, selected using a census sampling method. The results indicate that the stores department lack CIMA stock control strategies, leading to poor stock control policy formulation and application. Staff experience and the effect of municipal stock control policy have shown a positive and significant relationship at .000* level. Proper documentation of strategic stock control and staff experience has also shown a positive significant relationship at .004* level. Moreover, the municipal strategic stock control framework has been proposed at the end of this paper and is subject to further experiments by the scholars. Keywords: stock control, stock control policy, stock control strategies. JEL Classification: H54, M40
Highlights
IntroductionZwelihle Wiseman Nzuza, Lecturer, Department of Management Accounting, Durban University of Technology, Durban, South Africa
The Municipal Financial Management Act (MFMA) framework stipulates that stock control is carried out by the Stores Division in conjunction with the requirements of the Preferential Procurement Policy Framework Act (PPPFA), Act No 5 of 2000, which governs the control of the municipal stocks (Nzuza, 2015, p. 17)
This points to the fact that most of the respondents were experienced, since they had worked long enough to be conversant with the operations of stock control
Summary
Zwelihle Wiseman Nzuza, Lecturer, Department of Management Accounting, Durban University of Technology, Durban, South Africa. The overall aim of this research was to demonstrate how best a stock control can be applied at a CIMA strategic level. The specific objectives of the research were three: (1) to investigate staff understanding of stock control, (2) to investigate effects of the existing municipal stock control strategies; and (3) to demonstrate how best a stock control can be applied at a CIMA strategic level. The Municipal Financial Management Act (MFMA), Act No 56 of 2003 is an official framework for controlling the finances of a municipality including the unauthorized, irregular, and fruitless spending on stocks or inventories. This process can be demonstrated as follows: Source: self-generated. When stock is purchased from suppliers, the follow- crease, the municipality will keep its stock at the ing accounting journal entries must be passed
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