United States
Environmental Protection
Agency
Effluent Guidelines Division
WH-552
Washington DC 20460
July 1982
EPA-430-9-82-006
Water and Waste Management
Wastewater Utility Recordkeeping,
Reporting and Management
Information Systems
V, Ubrary
Soi*h Dearborn Stra*
606*4
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This document is available to the public through the U.S.
Department of Commerce, National Technical Information Service, Port
Royal Road, Springfield, Virginia 22161.
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This Report has been reviewed by the Municipal Operations Branch
(MOB) of the Environmental Protection Agency (EPA), and approved for
publication. Approval does not signify that the contents necessarily
reflect the views and policies of the EPA nor does mention of trade
names or commercial products constitute endorsement or recommendation
for use.
This guidance manual was prepared by the MOB of the Office of Hater
Program Operations of the United States Environmental Protection Agency.
Recognition is due to the New England Interstate Water Pollution Control
Commission, Peat, Marwick, Mitchell & Co. and the Municipal Finance
Officers Association for their assistance in providing information for
the manual. Recognition is also due to Myron A. Olstein and Jean B.
Levesque for their timely review and comments.
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WASTEWATER UTILITY RECORDKEEPING, REPORTING
ANJJ
MANAGEMENT INFORMATION SYSTEMS
PAGE
I. Introduction j
A. Background 1
B. Target Audience 1
C. Objective 2
D. Overview 3
II. Facility Management 4
A. Operations Management 4
1. Management Controls 6
a. Monitoring and Sampling 6
b. Laboratory 5
c. Process Control 6
d. Record Keeping & Reporting n
B. Maintenance Management H
1. Asset Management H
2. Inventory and Control 14
3. Records and Monitoring System 17
C. Energy Management 20
1. Identification and Monitoring of Energy Usage 20
a. Baseline Energy and Cost Data 20
D. Sludge Management 23
1. Monitoring 23
III. Support Services Management 24
A. Purchasing 24
1. Purchase Order 24
a. Format 25
b. Limited Purchase Order 25
c. Purchase Order Origination 25
11
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Page
2. Scheduling 31
3. Inventory Management 31
a. Classification of Inventory 31
b. Inventory Control and Order Points 33
B. Personnel 34
1. Performance Evaluation 34
2. Safety 36
a. Accidents 36
IV. Finance and Accounting 39
A. Internal Controls 39
1. Separate Accounting Duties 39
2. Use and Control Prenumbered Forms 40
3. Approval Signature 40
4. Reconcile Subsidiary Records to Control Totals 40
B. Chart of Accounts 40
1. Elements 41
a. Fund 41
b. Type of Account 41
c. Organization 41
d. Activities 41
e. Objects of Expenditures 41
f. Source of Revenue 41
g. Program or Project 41
2. Coding 41
C. Accounting Records 41
1. Source Documents 44
2. Books of Original Entry 44
3. Books of Final Entry 45
iii
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Page
D. Interim Financial Reports 45
1. The Balance Sheet 48
2. Statement of Actual and Estimated Revenues 48
3. Statement of Actual and Budgeted 48
Expenditures and Encumbrances
4. Statement of Actual and Budgeted Expenditures 59
and Encumbrances by Department/Activity
5. Cash Flow Analysis 59
6. Statement of Revenues, Expenses and Changes in 59
Retained Earnings
7. Statement of Change in Financial Position 60
V. Management Information System (MIS) 63
A. MIS Organizational Responsibility 63
B. Report Preparation 63
C. Operational Reports 64
D. Financial Reports 64
E. Management Reports 64
F. Manual vs. Electronic Data Processing 79
1. Defining Alternatives 79
2. Types of Software 80
3. The Selection Process and System Development 82
IV
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LISTS OF EXHIBITS
Exhibit
Number Description Page
1 Management Information System 5
2 Sample Laboratory Testing Program 7
3 BOD Worksheet 8
4 Daily Laboratory Record/Report 9
5 Trend Chart 10
6 Daily Digester Report 12
7 Daily Utility Operating Report 13
8 Equipment Record Card 15
9 Inventory Record Card 18
10 Work Order 19
11 Energy Data Collection Form 21
12 Energy Profile 22
13 Purchase Order 26
14 Limited Purchase Order 27
15 Request for Quotation 28
16 Vendor List 29
17 Vendor Evaluation Checklist 30
18 Purchase Schedule 32
19 Employee Performance Review & 35
Evaluation
20 Supervisors Accident Report 37
21 Monthly Accident Summary 38
22 Sample Account Coding Structure 42
23 Sample Utility Chart of Accounts 43
24 Balance Sheet 46
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Exhibit
Number Description Page
25 Statement of Actual & Estimated 49
Revenue
26 Summary Statement of Actual and 51
Budgeted Expenditures and
Encumbrances
27 Statement of Actual and Budgeted 52
Expenditures and Encumbrances
by Department/Activity
28 Cash Flow Results & Forecast 53
29 Statement of Revenues, Expenses, & 55
Changes In Retained Earnings
30 Statement of Changes in Financial 57
Position
31 Sample Daily Cash Report 61
32 Investment Record Card 62
33 Plant Performance Report 65
34 Maintenance Activity Report 67
35 Energy Cost & Consumption Report 69
36 Purchase Order Status Reports 71
37 Vendor File Activity Report 73
38 Stock Activity Reports 75
39 Employee Profile 77
40 Service Bureau vs In-house 81
Computer Cost & Benefits
Cost Benefit Analysis
41 Cost Benefit Analysis 84
42 RFP: Vendor Proposal Contents 85
VI
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I. Introduction
A. Background
The last twenty-five years have witnessed an enormous
increase in the number of publicly owned treatment works
(POTWs) throughout the country. This is due principally to
grants which have been the source of construction funding to
help clean up our nation's waterways. Many wastewater treat-
ment plants are large, capital intensive, and highly sophis-
ticated. As such, they present the owners with a range of
problems, some of which have few precedents. Solutions to
these problems demand timely and accurate information.
Wastewater problems can be divided roughly into two
categories; engineering and management. The engineering
problems have been dealt with in a variety of publications
from both the public and private sectors. Management
problems, however, have been largely ignored. This has
contributed to a public perception of wastewater utility
managers as lacking proper control, incapable of planning
effectively, and not wanting to resolve problems. This poor
public image makes effective management even more difficult.
Many problems with technical symptoms actually are rooted in
poor management practices. It is only in relatively recent
times that wastewater treatment has been managed as a
self-supporting utility. The three basic management
objectives for wastewater utilities are:
o To provide quality wastewater treatment and readily
disposable by-products;
o To operate wastewater treatment facilities and works
in an efficient manner; and
o To operate the wastewater treatment function as a
self-sustaining utility.
The ability to plan, operate and control a wastewater
utility efficiently depends on the type of information
available to the utility manager. Management information is
usually in the form of reports prepared from operating
statistics or data. It is important to understand
the distinction between DATA and management INFORMATION.
DATA is generally comprised of statistics arranged in
some logical manner.
Management INFORMATION is a tracking or combination of
various data arranged in a comparative format.
1
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As more treatment facilities become operational and
existing facilities grow older, the need for better management
systems becomes increasingly evident. To meet this need, EPA
has developed a series of Management Assistance Documents.
This series reflects the established principle that the
independent, financially self-supporting, utility organization
is the best possible framework for a well managed wastewater
treatment operation. The various parts of this document are
intended to familiarize the municipal manager with the
recordkeeping and management information aspects of self
supporting utility management.
B. Target Audience
This Utility Recordkeeping, Reporting and Management
Information Systems document is designed for use by both
treatment works and municipal management personnel.
Principal users include:
o Town/City Managers,
o Town/City Financial Directors,
o Utility Directors,
o Public Works Directors,
o Plant Superintendents, and
o Chief Operators.
Additionally, management consultants can use the guidance
in evaluating and establishing recordkeeping and management
information systems for wastewater utilities.
C. Objective
The purpose of this guidance document is to provide
guidance for wastewater utility managers on recordkeeping and
management systems. This information is essential to managing
a utility to assure sustained acceptable performance at
minimal cost.
D.
This document addresses the various aspects of wastewater
treatment utility management and its information needs. It
gives examples of reports and record keeping forms. It
addresses the various aspects of record keeping as applied to
the management of utilities and explains impacts of record-
keeping on operation. In addition this document presents an
approach to the development of appropriate management informa-
tion systems to meet local needs. Thus, alternative systems
are defined, types of software discussed, and selection
processes presented.
This document is written to allow an individual with
general management abilities to both develop and control the
development of a management information system.
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E. Overview
The five functions of management are:
o Planning
o Organizing
o Staffing
o Directing
o Controlling
None of these functions can be properly carried out
without timely and accurate information for example:
o Long range planning cannot be carried out without
good information regarding the quality of the
physical plant; financial plans cannot be prepared
without sound information regarding the utility's
financial status, etc.
o The various activities of the utility cannot be
organized, or reorganized, without an information
system that alerts the manager to problems.
o Proper staff decisions cannot be made without good
information regarding the qualifications of the
present staff.
o Directing requires a base of sound historical
information regarding the utility.
o Controlling, more than the other functions, requires
thorough and timely information to permit an
evaluation of current position and redirection if
required.
This guidance identifies some of the major wastewater
utility recordkeeping, reporting and management information
systems used by a properly managed utility. These systems
will be discussed separately for the following wastewater
utility functions:
Facility Management
o Operations Management
-Monitoring and Sampling
-Laboratory
-Process Control
-Recordkeeping and Reporting
o Maintenance Management
-Asset Management
-Inventory and Control
-Records and Monitoring
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o Energy Management
o Sludge Management
Support Services
o Purchasing
o Scheduling
o Inventory Management
o Personnel
o Safety
Finance and Accounting
o Intenal Controls
o Chart of Accounts
o Accounting Records
o Interim Financial Reports
-Balance Sheet
-Revenue and Expense Statements
-Expenditure Tracking
-Cash Flow Analysis
-Changes in Financial Position
In Chapter V, these diverse recordkeeping elements are
integrated into a management information system (MIS).
Exhibit I shows how these various data sources are utilized to
support the system.
II. Facility Management
Wastewater treatment facility management systems include
operations, maintenance, energy and solids handling. This chapter
focuses on preparation of operating reports, equipment
identification, parts inventory and control systems, and control-
ling energy and sludge disposal costs.
A. Operations Management
Of the various utility management functions, operations
has the most direct and immediate impact on the overall
utility objective, i.e., to reduce pollutants in municipal
wastewater to the prescribed effluent quality level and to
dispose of the residuals in an environmentally safe manner.
Utility operations include supervision, monitoring and
control of the various wastewater activities and the achieve-
ment of required levels of water quality in an efficient and
consistent manner. For each of these activities the key
elements for effective operations management include adequate
management controls.
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SUPPORT
o PURCHASING
o WAREHOUSING & STORES
o PERSONNEL
o SHORT & LONG RANGE PLANS
o CAPITAL IMPROVEMENT PROGRAM
o GRANTS MANAGEMENT
o CONSTRUCTION MANAGEMENT
MANAGEfeiT
INFORMATION
QVCTuM
01 o I L_J i
FINANCE
ACCOUNTING
o INTERNAL CONTROLS
o CHART OF ACCOUNTS
o ACCOUNTING RECORDS
o INTERIM FINANCIAL REPORTS
UTILITY
MANAGEfOT
FACILITIES
o OPERATIONS
o MAINTENANCE
o ENERGY
o SLUDGE
X
n:
i—i
DO
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1. Management Controls
To achieve effective wastewater utility operations,
management controls must be developed to regulate the
processes. These require consideration of:
o Monitoring and Sampling
o Laboratory Capabilities
o Process Control, and
o Recordkeeping and Reporting.
a. Monitoring and Sampling
A monitoring and sampling program is the basis
for all subsequent conclusions, decisions and
actions in process control. The program scope
depends on the type of treatment processes, the
location of the facilities, laboratory capabilities
and the capability of operating personnel. Exhibit
2 is an example of one type of sampling program.
b. Laboratory
Laboratory activities provide the basis for
process control, management reporting and for
regulatory compliance reporting. Therefore, it is
important that standard laboratory procedures,
including quality control, and worksheets be
established and used. Exhibits 3 and 4 are examples
of laboratory worksheets and reports.
c. Process Control
An effective process control program is
essential if the treatment facility's performance is
to be optimized. Two key elements of process
control are:
o A recordkeeping system that permits the
identification of long-term trends, and
potential problems before they occur. This is
most effectively done by the use of trend
charts on which key wastewater parameters are
plotted over time, and
o An understanding of past performance to
identify recurring problems and anticipate them
in the future, (see Exhibit 5)
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SAMPLE LABORATORY TESTING PROGRAM
RAW
SEWAGE
PRIMARY
EFFLUENT
SECONDARY
EFFLUENT
CHLORINE
CONTACT TANK
MIXED
LIQUOR
PLANT
EFFLUENT
LEGEND:
TYPE OF SAMPLE
C - COMPOSITE SAMPLE
G - GRAB SAMPLE
* EVERY 4-HOURS
FREQUENCY
D - DAILY
W - WEEKLY
D2- TWICE DAILY
TYPE OF
SAMPLE
FREQUENCY
X
:r
i—i
CO
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DAILY LABORATORY RECORD/REPORT
00
GRAB SAMPLE
TIME
COLOR
TEMP.
PH
Settleable
Solids, ml/1.
Dissolved
Oxygen, mg/l.
Residual
Chlorine, mj/l.
INFL.
COMPOSITE. 24 hr.
START/STOP
COLOR
_pH_
Sett. Solids, ml/1.
TSS, mg/l.
VSS, mg/l.
S-DAY B.O.D., mg/l.
% B.O.O. Removal
Total Phosphate, mg/l. P
Ammonia, mg/l N
Turbidity, NTU
Alkalinity, mg/l. as
Prim.Eff. Trickier Final
DATE
FLOW: Max.__
Weather
Min.
DIGESTER pH.
ALKALINITY
Air Temp..
_ CO2
_ Total
Precipitation .
CH4
VOLATILE ACIDS
.mg./l. asCaCOa
_mg./l. as HO Ac
Sample
% Solids
%Volatile
PH
Chemical
Amt. in Storage
Amt. used/24 hr.
Dose, mg/l
AERATION TANKS
TANK
MLTSS, mg/l
ML VSS, mg/l
6min.
^'"""iSmin.
30mln.
60min.
SVI, ml/g
cent, vol., ml.
cent, factor
PH
sup. turbidity
RSTSS, mg/l
cent, vol., ml.
cent, factor
S. B. D., ft.
1
2
3
Average
Inventory, Ibs. Wasting, gal. Ibs. MCRT
X
DC
DO
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BOD WORK SHEET
Date In
Date Out
Sample
(1) Dilution
Bottle
No.
Factor
Sample
Volume
•300~n
Dilution^
Factor
Initial
DO (mg/l)
Final
DO (mg/l)
SeedP)
Correction
DO Change (3)
(mg/l)
BODW
(mg/l)
J
Sample Volume
(2) Seed Correction = DO consumed by seeded blank
PKlnitial DO - Final DO) - Seed Correction
(4) DO Change x Dilution F'tcior
Seed in Sample
beed in Blank
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TREND CHART
Month of May
Dissolved Oxygen in Aeration Tank
Composite Average
DISSOLVED
OXYGEN
(mg/1)
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
DAYS OF WEEK
DO
i—i
-H
tn
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d. Recordkeeping and Reporting
Recordkeeping and reporting of operating
conditions are essential tools for operators and
managers to control the facility and satisfy
compliance reporting requirements.
Daily logs should be maintained for each unit
process. Each shift, as it begins duty, and the
Chief operator should review these logs to identify
short-term process problems. Exhibit 6 is an
example of a daily report for a particular unit
process. A summary of each unit process log should
be entered in a utility daily report as illustrated
by Exhibit 7. This becomes a permanent record of
the routine operations of the facility.
Daily reports may contain a wide variety of
factual information in addition to actual operating
data from the unit process logs. These data might
concern equipment failures, laboratory results,
energy consumption, weather conditions, bypassing of
operations, complaints and facility visitors.
Monthly and annual reports should be prepared for
submission to regulatory agencies and utility
management.
B. Maintenance Management
Maintenance has become an increasingly significant
function within wastewater facility management. With the need
for higher levels of wastewater treatment, the technologies
required to achieve these levels have become increasingly
complex. This has resulted in the need for a systematic and
comprehensive maintenance program not only to keep the plant
operating efficiently without interruptions to the treatment
process, but also to preserve the substantial capital
investment in equipment, structures and control systems.
The elements of an effective maintenance program include:
o Asset management,
o Inventory and control, and
o Records and monitoring system.
1. Asset Management
Records should be established and maintained for
each piece of equipment and property. This record system
should include:
o Equipment description,
11
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Remarks -
EXHIBIT 6
DAILY DIGESTERS REPORT
DATE 19.
urcnM i un
Gas C. F.
Storage
Gas
Production
Meter
Gas To
Engines
Meter
Gas To
Waste
Meter
Temp.
Sec.
Sludge Level
Cover
Pos. Sec.
Cover
Pos. Prim.
Jacket
Water
Temo.
Sludge
Temp.
11-7
NAME
Prim.
Ft.
Ft.
Ft.
In
In
Sec.
In.
In.
In.
Out
Out
7-3
NAME
Prim.
Ft.
Ft.
Ft.
In
In
Sec.
In.
In.
In.
Out
Out
3-11
NAME
Prim.
Ft.
Ft.
Ft.
In
In
Sec.
In.
In.
In.
Out
Out
12
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EXHIBIT 7
DAILY UTILITY OPERATING REPORT
PLANT
FINAL
INITIAL
TOTAL
INFLUENT FLOW METER
GAS PRODUCED
FINAL
INITIAL
TOTAL
HOUR
0. 0.
DESCRIPTION
SCREENINGS
GRIT
SCUM
USED
CL2 RES.
QUANTITY
CHECKLIST
AIR COMP. SPRAY PUMPS
BLOWERS GAS COP.
GAS LINES HEAT EXCH.
ftETURN SLUDGE
SLUDGE PUMPED
CHLORINE USED
FINAL
INITIAL
TOTAL
BLOWER NO. 1
FINAL
INITIAL
TOTAL
BLOWER
FINAL
INITIAL
TOTAL
NO. 2
AIR TEMP. »F
SEWAGE TEMR «r
WEATHER:
WASTE SLUDGE
HEAT EXCHANGER
TEMPERATURE
IN OUT
»r «r
SVI
AIR SUPPLIED
DIGESTER
TEMPERATURE
»F
MLSS
REMARKS: 1ST SHIFT
OPERATOR ;
DATE:
PLANT INFLUENT FLOW METER
FINAL
INITIAL
TOTAL
GAS PRODUCED
FINAL
INITIAL
TOTAL
HOUR
0. 0.
DESCRIPTION
SCREENINGS
GR T
SCUM
USED
CL2 RES.
QUANTITY
CHECKLIST
AIR COMP. SPRAY PUMPS
BLOWERS GAS COMP.
GAS LINES HEAT EXCH.
RETURN SLUDGE
SLUDGE PUMPED
CHLORINE USED
FINAL
INITIAL
TOTAL
BLOWER NO. 1
FINAL
INITIAL
TOTAL
BLOWER NO. 2
FINAL
INITIAL
TOTAL
AIR TEMP. *F
SEWAGE TEMP. *F
WEATHER:
WASTE SLUDGE
HEAT EXCHANGER
TEMPERATURE
IN OUT
*F *F
AIR SUPPLIED
DIGESTER
TEMPERATURE
• r
SVI
MLSS
REMARKS: 2ND SHIFT
OPERATOR :
QATE :
13
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o Manufacturer's equipment data (name plate data),
o Spare parts and material required to maintain the
equipment,
o Inspection and lubrication records,
o Preventive maintenance records, and
o Repair records.
In addition to maintenance information, the record
system should include financial data to permit cost
reporting information, including:
o Date of acquisition,
o Cost,
o Maintenance and repair cost,
o Labor hours, and
o Useful life.
The method of monitoring equipment record
information depends on the size and complexity of the
facility, the availability of data processing support,
and the types of management reports to be generated from
the data. Exhibit 8 illustrates a relatively simple card
file system that contains the basic data requirements.
The most common problem with the asset management
element of a maintenance program is it is installed but
not maintained. It is critical that the equipment
records be kept completely and routinely up to date.
This requires the commitment of staff, generally the
chief mechanic or a record clerk, to record maintenance
data as maintenance tasks are completed, and periodic
reviews by the utility manager to insure that records are
kept up to date.
2. Inventory and Control
A spare parts inventory and control system is
essential to:
o Assure the availability of necessary spare parts and
materials for both preventive and corrective
maintenance,
o Maintain optimum quantity levels,
o Monitor quality, and
o Minimize the cost of carrying excess parts.
The items that need to be inventoried and the
quantities to be maintained depend on the type and
diversity of equipment, the availability of local
vendors, lead time for delivery, frequency of use,
and costs. The inventory and control system
includes the following elements:
o Identification of all inventory items required,
14
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EXHIBIT 8
EQUIPMENT
INVENTORY NO. CARD NO.
REFERENCE
MANUFACTURER
DATEOFMANUF:
| DATE PUT INTO SERVICE:
SALES A SERVICE
DATE REPLACED: | LENGTH OF SERVICE
NAMEPLATEDATA-MODEL SERIAL NO. SIZE RPM TYPE
MOTOR DATA- MODEL
H P. VOLTS
INSULATION CLASS
SERIAL NO. FRAME TYPE CODE LETTER
AMPS RPM HERTZ PHASE RATING NEMA DESIGN
SERVICE FACTOR
REMARKS
PARTS DESCRIPTION
DUITg SPARE PARTS
RECOMMENDED INVENTORY RECORD (NO. IN STOCK * DATE)
DATE
i
•
i
I
i
j
1
j
i
*
;;ii
! ! ! t
I * I ' *
SIDE 2
DESCRIPTION OF REPAIR
PARTS REPAIRED OR REPLACED
TOTAL COST
PARTS TOTAL
COST
BY WHOM
, LABOR TOTAL
MANHOURS
COST
REMARKS
DOWNTIME
DATE | DESCRIPTION OF REPAIR
PARTS REPAIRED OR REPLACED
TOTAL COST PARTS TOTAL
COST
BY WHOM
LABOR TOTAL
DATE | DESCRIPTION OF REPAIR
MANHOURS
COST
REMARKS
DOWNTIME
PARTS REPAIRED OR REPLACED
TOTAL COST PARTS TOTAL
DATE DESCRIPTION OF REPAIR
COST
BY WHOM
LABOR TOTAL
MANHOURS
COST
REMARKS
DOWNTIME
PARTS REPAIRED OR REPLACED COST BY WHOM MANHOUHS COST
TOTAL COST
DATE
| PARTS TOTAL
DESCRIPTION OF REPAIR
LABOR TOTAL
DOWNTIME
15
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MACHINE NO
TYPE MACHINE
|J|F|M|AJM]J[J]A|S|0|N[D
TYPE MACHINE
YEAR
19
t9
19
1 3 > i t 1
MECHANICAL AND ELECTRICAL INSPECTIONS SCHEDULE
'ii*i«'isTuTulii tiTiilii a 2124 a a 17 n M]»]HH 11 u is hi j> JIHW'II u » HKU it u|«|» ii i;
OIL CHANGE AND LUBRICATION SCHEDULE
DATE WORK ORD
DESCRIPTION OF REPAIRS AND REPLACEMENTS
TOTAL
COST
PREVENTIVE MAINTENANCE RECORD
m
X
X
E5
H
o>
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o Classification of items, and
o Control system.
The identification of inventory items should be
based on the equipment record system discussed
previously, the maintenance manual, equipment service
manuals, and maintenance staff experience.
Items should be classified based on factors such
things as cost, usage, delivery time, shelf life and
impact on plant operations. Using this classification,
quantities and reorder policies should be established.
Where financial and/or management resources are limited,
reorder policies should be developed to ensure an
adequate supply of the most critical spare parts.
The inventory control system should include the
following information:
o Item identification,
o Units of measure,
o Purchasing lead time,
o Stock requirements,
o Reorder points,
o Quantities on hand, and
o Cost.
See Exhibit 9 for a sample inventory card.
3. Records and Monitoring System
The basis for reporting and monitoring the
maintenance program is the "work order" system. It
should be used to initiate all preventive and corrective
maintenance activities where parts are required, equip-
ment is out of service, or a certain level of labor is
required. Routine maintenance tasks below certain time
requirements need not be placed on work orders but should
be entered into the maintenance log and equipment record
system.
Exhibit 10 is an example of a typical work order.
After work is completed, work order information should be
transferred to the permanent equipment record system, the
inventory control system, and the management information
systems recording labor distribution and cost data. Work
orders should be filed chronologically and by equipment
item for future reference.
17
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EXHIBIT 9
Commodity Class Code:
Description:
INVENTORY RECORD CARD
Minimum Stock Qty:
Required Lead Time:"
Primary Vendor:
Maximum Stock Qty:
Unit of Measure:
Storage Location:
ORDFRFD
Date
P.O. No.
Vendor
Qty
DrTTTTmrn
Date
Qty.
Amt. ($} .
Date
15b
Equip.
UED
Qty.
¥
Amt!
BA;
Date
*ANCE
Qty.
Amt.
Additional considerations:
1. Seasonal Maintenance Requirements Date
2. New Equipment Purchase Date
3. Other:
Quantity
Quantity
* See Exhibit 17 for examples of Commodity Class Codes
18
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EXHIBIT 10
SEWER
WATER
METER
=L=CTRIC PROD.
MAINTENANCE DIVISION WORK ORDER
GENERAL OFrlCE
STORES
OATS COMPLETED
•0 36 'S
PEBFOSMEO
JNIT)
MATERIALS FROM STOCK
UNIT
J4ATFKTAT.S
STOCK
EMPLOYEE NAME
HOURS
EMPLOYEE NAME
HOURS
TRUCK NUMBER
HOURS
TRUCK NUMBER
HOURS
TRUCK NUMBER
HOURS
TRUCK NUMBER
HOURS
RK
FOREMAN
COMPLETION CHECK
SUPT
19
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Additional guidance in development maintenance
management systems can be found in -
"A Planned Maintenance Management System for
Municipal Wastewater Treatment Plants,"
EPA-600/2-73-004.
C. Energy Management
Since the energy crises in the mid 1970's energy
availability and high energy costs have become a major concern
to most wastewater utility managers. A critical element of
efficient plant management is a program to plan, monitor and
control energy usage and cost without sacrificing facility
operations. To accomplish this, utility managers should
develop and implement a comprehensive energy management
program.
1. Identification and Monitoring of Energy Usage
To develop an effective energy management program,
the utility manager must have a good understanding of energy
usage in his operation, have developed sufficient baseline
data, and have reviewed operating and maintenance procedures
to determine the impact on energy management alternatives.
Also, he must thoroughly understand the billing system that is
being used to assess energy user charges.
a. Baseline Energy and Cost Data
Baseline data regarding energy consumption, cost,
operating procedures and design conditions should be
developed. The types of data that should be
gathered include:
o Energy consumption and cost data for one or
more previous years, including electric utility
billing records, internal electric metering
records, and records of purchased fuels.
Energy consumption should be determined by unit
process. Exhibit 11 illustrates a basic data
collection form used for summarizing
consumption and cost data. From the available
data, energy consumption profiles can be
established. They can be developed directly
from metering records or estimates using
equipment ratings multiplied by overall average
running times and load factors. A typical
energy profile is shown on Exhibit 12. Daily
operating logs should be compared to utility
bills to determine the relationship between the
20
-------
ENERGY DATA FOIIM
ro
YtAH
mi LING PERIOD
or Unit Process
IGfAl
ELECTIIICIIY
KWII
.
$
KW
$
TOTAL $
GAS
THERMS
$
OIL
GAL
$
omtn ||
UNITS
$
1OIAL
TOTAL $
X
:c
i—i
DO
-------
CONSUMPTION (KILOWATT/HOURS)
H, 1 1 1 1 \ 1 1 1 1
TO
ro
to
O
•n
I
fd
Pd
CO
X
31
I—I
CO
INS
-------
facility's energy usage and peak demand in the
operation of various unit processes. Based on
the energy use data, energy conservation
options can be identified and evaluated. I/
D. Sludge Management
Sludge management is an especially difficult part of
utility management. Sludge management requires planning,
particularly long range planning, a consistent shortcoming.
Alternatives tend to be both politically and technically
difficult to implement; therefore, decisions on long range
solutions tend to be deferred.
1. Monitoring
Monitoring and surveillance, particularly at sludge
disposal sites are essential parts of a sludge management
program. The program should be developed not only to
prevent potential health hazards but also to assure
proper system operations. Monitoring should be initiated
prior to disposal and background levels (particularly for
heavy metals) clearly defined so that any changes in
contaminant levels can be identified and assessed.
Specific examples of data and recordkeeping are not
given here because monitoring requirements and practices
will vary depending on the exact process, the size of the
plant and the needs of the local facility. Estimated
unit process sampling and testing needs can be found in
the following guidance.
"Sludge Handling and Conditioning," EPA
430/9-78-002
"Estimating Laboratory Needs For Municipal
Wastewater Treatment Facilities," EPA 430/9-74-002
I/ For more detailed information on energy use data, see "Energy
Management Diagnostics," Office of Water Program Operations,
Environmental Protection Agency, Washington, D.C. 1982.
23
-------
III. Support Services Management
Some management support functions such as purchasing and
personnel are often controlled external to the utility. These two
functions generally represent a large portion of utility expen-
ditures. This chapter addresses several support services functions
including: purchase orders, scheduling, warehousing and spare
parts, performance evaluations, labor relations and safety.
A. Purchasing
The purchasing activity supports buying the right material at
the best price in the proper quantity, at the proper time and from
the best supplier. Although the wastewater utility manager is
usually not responsible for all purchasing activities, he must
frequently:
o Provide requisitions for purchasing through a central
purchasing agent; and
o Maintain separate records for purchased goods, vendor
suppliers and goods received.
This section describes the types of forms and records which should
be maintained.
1. Purchase Order
The purchase order is a key document in an effective
purchasing system. The purchase order should be used to
control the item count (number of goods) and cost of
goods received. At a minimum, the purchase order form
should:
o Provide adequate space for vendor and utility name,
vendor and utility address, vendor contact and
vendor phone number;
o Permit entry of all items or commodities ordered
with space for:
Commodity (stock item) number or code,
Description and quantity ordered,
Unit price and payment terms,
Total anticipated price,
Scheduled delivery date, and
Shipping terms;
o Trace the vendor quotes received;
o Identify vendor selection process;
o Provide for authorizations and signatures;
o Indicate purchase order copy distribution; and
o Contain a prenumbered reference for control
purposes.
24
-------
a. Format
Exhibit 13 illustrates a purchase order de-
signed to support the recommended policies and
processing for a utility purchasing system. This
format permits the purchase order to serve as the:
o Request for vendor delivery,
o Price agreement,
o Vendor tracking system,
o Accounting approval for payment, and
o Payment voucher.
b. Limited Purchase Order
A limited purchase order is an authorization to
commit a relatively small expenditure with an
approved vendor. Exhibit 14 illustrates a typical
limited purchase order.
c. Purchase Order Origination
The utility manager should initiate purchase
orders supporting utility purchases. Because of:
o Centralized control of purchase order numbers,
o Centralized collection and maintenance of
records,
Vendor list,
Inventory cards,
Purchase order files,
Receiving schedules,
Specification documents,
Parts lists,
o On site availability of records to support
maintenance activities in the facility, and
o Reduced clerical burden and duplication of work
in administrative offices.
Exhibit 15 illustrates a format for recording
request for quotations. Exhibit 16 illustrates a
vendor listing and Exhibit 17 illustrates a
checklist for evaluating vendors.
25
-------
EXHIBIT 13
PURCHASE ORDER
To: Vendor Name From: Utility Name
Address Address
Attn: Phone Attn: Phone
CQTTTTP -
NoT
Description '
Juanit
'Unit
Price
P.O. #
Order
date / /
Requested Delivery
Date / /
Total
Price
Account So.
AWARD & CONTROL DATA
TYPE OF QUOTE Verbal Written Sealed Bid
Vendor No. Price Description
Verbal Quotes Only
1.
2.
3.
Written and Sealed Bid Quotes Only
Selection
123
Reason:
Completed RFQ Attached Yo(. No ReasOn:
Purchase posted to fixed Asset Records Yes No p«a«nn!
Materials and spare parts list Obtained Yes No Reason:
Prep
Appr
ared by Date Approved By
Title
oved for Payment Date Paid Date
Date
Check No.
DISTRIBUTION: White; Vendor Pink: Utility Blue: Accounting Yellow: MIS
26
-------
LIMITED PURCHASE ORDER
EXHIBIT 14
Vendor Name No.
Address
Attn: Phone
Quantity Description
1.
2.
3.
Justification
1.
2.
3.
Utility Name
Address
Attn: Phone
Comm. No
'rice
Total (less than $100
.00)
LPO #
Total
Price
1$
Account No:
Account No:
Account No:
Authorized By
Paid By
Date
Date
Check No.
DISTRIBUTION: White: Vendor
Pink: Utility
Blue: Accounting
27
-------
EXHIBIT 15
REQUEST FOR QUOTATION
THIS IS NOT AN ORDER
TO:
Vendor Name
Address
Attn:
Phone:
FROM:
Attn:
Utility Name
Address
Phone:
P.O. Reference
No.
Dear Vendor,
Please provide a unit price quotation for the goods and/or services described below. Keep the
attached duplicate copy and return the original to the above address. Explain any substitutes
or modifications to the description completely. YOUR QUOTATION MUST BE IN OUR OFFICE AT THE
ABOVE ADDRESS BY: (a.m./p.m.) 19
Delivery to be made from
Terms:
in
_days from receipt of order.
_estimated shipping weight Ibs.
ITEM
QUAN.
DESCRIPTION OF GOODS AND/OR SERVICES
rar
We quote you as noced above:
Signed:
Title:
Date:
28
-------
VENDOR LIST
Revised
For Quotation Reference
P.O. Number:
Date submitted:
Vendor
RFQ
Vendor Name
Vendor Number
Address
Contact Person
Phone
Commodities
m
x
-------
VENDOR EVALUATION CHECKLIST
EXHIBIT 17
Criteria
Vendor A:
Rating
Vendor B:
Rating
Vendor C:
Rating
1. Lowest Price
2. Delivery Date
3. Post Performance
A. Freight/Delivery
5. Discount Offered
6. Multi-Commodity
7. Type of Commodity
8. Price Adjustment
Clause
9. Variation to
Specifications
10. Non-Collusion
Clause
low medium high
first second third
low average high
low medium high
low medium high
low medium high
brand replace- tooled
name ment
yes
no
none slight substan-
tial
yes
no
low medium high
first second third
low average high
low medium high
low medium high
low medium high
brand replace- tooled
name ment
low medium high
first second third
low average high
low medium high
low medium high
low medium high
brand replace- toolec
name ment
yes
no
yes
no
none slight substan-
tial
none slight sub-
stantial
yes
no
yes
no
30
-------
2. Scheduling
Planning and scheduling purchases over a given
period of time enhances:
o Cost efficiency,
o Cash flow planning,
o Budgeting capabilities, and
o Timely maintenance activities.
To accomplish this the utility manager should
collect 2-3 years of expenditure data showing:
o Type of purchase,
o Amount,
o Date, and
o Stock or immediate use item.
The manager then records this data on a purchase
schedule as illustrated in Exhibit 18. Using current
year budget data and capital and operating plans for the
facility the manager can then project current year
purchase requirements by month.
3. Inventory Management
Timely equipment repair is critical to the reliable
operation of a wastewater utility. This function depends
upon an adequate spare parts inventory. The utility
manager's inventory should contain a proper mix and
quantity of items.
a. Classification of Inventory
To assist the manager in assessing inventory
items on hand, a proper inventory classification
should be. established. The following commodity
classes represent the goods purchased by a utility:
Commodity Class
Code Commodity Description
100 Office Supplies
200 Chemicals
300 Maintenance Supplies
400 Laboratory Supplies
500 Equipment Parts
600 Training Supplies
700 Tools
31
-------
Commodity Class
100 Office Supplies
Year 1
2
3
200 Janitorial Supplies
Year 1
2
3
300 Operating Supplies
Year 1
2
3
400 Chemicals
Year 1
2
3
500 Maintenance Supplies
UTILITY PURCHASE SCHEDULE
Aug. sept. Oct. Nov. Dec. Jan. Peb. March AprU Hay June
Total Purchases
Year 1
2
3
x
:c
i—i
D3
00
-------
Each class should be subdivided to provide a
level of detail appropriate to the utility. For
example:
600 Training Supplies
10 Operations and Maintenance Manuals
20 Publications
30 Textbooks
40 Films
50 Packaged course materials
Class 500, equipment parts, should be
organized by type of equipment to compliment the
equipment record card (see Exhibit 8). Each
equipment record card should include a recommended
spare parts inventory. Warehousing is responsible
for assembling the parts required by equipment group
and identifying interchangeable parts and parts
substitutions. This may require the assistance of a
mechanic.
b. Inventory Control and Order Points
Utility management includes the control of
inventory and identification of order points. To
manage the function properly, a system of perpetual
inventory cards should be maintained. Exhibit 8 is
an example of an inventory record card. This card
does not replace an equipment record card, but does
indicate which spare parts are required to repair a
specific piece of equipment. The inventory card
provides data regarding on hand quantity and
required quantity for parts to repair all equipment
using that part. Minimum stock quantity may be
determined by:
o Dividing total number of parts or units used
per year by the total number of operating days
in the year; the result is the average quantity
used per day.
o Multiplying the average quantity used per day
times the number of days required from the
point of order request to the point of
delivery; the product is the required number of
parts or units needed during that order period.
33
-------
o Multiply the above product times 1.25 for a 25%
safety margin (this margin may be increased or
decreased depending on the item purchase).
The maximum stock quantity indicates the
inventory level over which the cost of storing the
inventory is excessive and may not be justified.
B. Personnel
Personnel management affects all levels and departments
of an organization. This function, if not properly managed,
can have a far reaching negative impact on the utility.
Personnel management requires maintenance of personnel
records. These records should provide a complete history of
each staff member from hiring to termination and should
include:
o The application form,
o Job descriptions,
o Interview notes,
o Insurance and tax forms,
o Performance evaluations,
o Salary history,
o Sick leave and vacation history,
o Training, and
o Notes from an exit interview given at employment
termination. I/
1. Performance Evaluation
The performance of each employee should be reviewed
at least annually. This annual review process involves
utility management in the employee's career objectives
and encourages a commitment to effective and efficient
utility operations consistent with the utility's overall
objective. The review should be objective, open, and the
results should be documented. Exhibit 19 is a sample
annual evaluation form which serves as a minimum bench-
mark for discussion. Since this form is subjective, it
should be supplemented with notes on the employees
performance of tasks and other initiatives and
accomplishments.
\J For detailed information on staffing needs, see "Estimated Staffing
for Municipal Wastewater Treatment Facilities," Office of Water
Program Operations, Environmental Protection Agency, Washington,
D.C. March, 1973.
34
-------
EXHIBIT 19
EMPLOYEE PERFORMANCE REVIEW AND EVALUATION
Dtrrlesi
DO NOT ALLOW PERSONAL FEELING TO GOVERN YOUR RATING.
which are not typical.
Knowledge
of Work
Effect on
Workers
Promptness
Responsibility
Accuracy
Quantity
Of Work
Initiative
Application
Comments:
Practically
None
D
Often
Breeds
Trouble
D
Always
Tardy
a
Careless
and
Negligent
D
Is highly
Inaccurate
a
Amount of
work unsat-
isfactory
D
Must always
be told what
to do
a
Indifferent
and Lazy
D
Check In block which seems
D
a
a
a
a
D
a
D
Below
Average
D
Sometimes
causes
Dissension
a
Must be
reminded
about
Promptness
D
Not very
reliable
D
Is often
Inaccurate
D
Turns out
just enough
to get by
a
Needs con-
siderable
Supervision
D
Tendency
toward
Indifference
a
Use back of sheet
D
a
a
a
n
a
a
a
for
Do net be Influenced by UNUSUAL SITUATIONS
beit to fit above employee.
Acceptable
Knowledge
a
'No out-
standing
effect on
workers
D
Usually
Prompt
D
Accepts
fteip.
when asked
D
Makes
Occasional
errors
a
Turns out
fair ami.
a
Needs
Direction
and help
in coses
D
Average
application
a
a
a
a
a
a
a
D
a
additional information or
Somewhat
above
Average
D
Belter than
Average
a
Never Late
without
good cause
a
Assume*
Reip.
without
being told
a
Somewhat
above
Average
D
Always
finishes
alloted
amount
D
Needs
little
Supervision
a
Interested
and Diligent
D
remarks.
a
a
a
a
D
a
a
a
Very well
Informed
a
Promotes
cooperation
and Good-
will
D
Almost
never late
a
Accepts
Resp. above
Average
Requirement
D
Rarely
mokes
mistakes
D
Turns out
more than
average
amount
D
Pushes work
thru on own
initiative
D
Puts extra
effort into
work
D
35
-------
Safety
Every utility should have a formally recognized
safety program. A good program will accomplish three
goals:
o Reduce the total cost of operations;
o Increase productivity; and
o Provide a feeling of security and well-being for
personnel.
A successful safety program starts with management's.
commitment of necessary time and resources.
a. Accidents
After a new employee has been hired, the
manager must ensure that he is given the proper
training in the work skill for the job and in the
safety program. This will greatly reduce the chance
of accidents. If an accident occurs, the immediate
supervisor and safety officer should be informed.
The supervisor should investigate each accident
thoroughly and complete an accident report similar
to the one shown on Exhibit 20. Should an employee
need medical attention, he should be taken to a
specified doctor, clinic or hospital. The accident
report should show the doctor's name and diagnosis,
the cause of the accident, and what has been done to
prevent it from happening again. The information on
these forms can be used to prepare a monthly summary
of all accidents. A form such as the one shown on
Exhibit 21 can be used. These reports can be
reviewed to find ways of decreasing accidents.
36
-------
EXHIBIT 20
No.
SUPERVISOR'S ACCIDENT REPORT
A.M.
Name of Injured Date of Injury Time P.M.
Department Division
Location Occupation
Doctor Hospital Estimated Lost Time_
Describe the Injury
Describe fully how accident happened, and what employee was doing when injured;
CAUSES OF ACCTDENT
Unsafe Equipment_ Unsafe Conditions___ Unsafe Act
Explain the above:
What has been done to prevent a recurrence of this type of accident?
Witnesses:
Reported by:
Approved by Dept. Head
Approved by Manager_
\;;<>i ' s 3' ( idont rppor*- form.
37
-------
MONTHLY ACCIDENT.SUMMARY
to
oo
CUMULATIVE THIS YEA!
Department S Divisions
x
n:
i—i
en
Montr-.,-/ acci-ier.t. surr.marv r^rm.
-------
IV. Finance and Accounting
Accounting in publicly owned treatment works (POTWs) is
important for two significant reasons. First, accounting can
provide local officials with a high level of confidence that
resources are being used properly. Secondly, accounting reports
can provide local officials with the information they need to
evaluate utility performance and set a course for future action.^/
Complete and timely accounting reports are vital ingredients in
successful management and policy making. These reports should
cover such matters as local financial conditions, actual
performance against budgeted expenditure and revenue targets, or
the cost of providing specific types of service. Through sound
accounting procedures and periodic audits of financial records and
procedures, assurance is gained that the resources of the utility
are properly safeguarded. The purpose of this chapter is to set
forth some basic accounting procedures and practices, and to show
the utility manager how he can (through operating statements) match
actual results of operations with planned or budgeted amounts.
A. Internal Controls
To implement and maintain a sound accounting process
successfully, accounting functions should be well organized
and controlled. Accounting responsibilities, procedures and
policies should be designed to help prevent:
o Misstatement of account balances because of errors (both
intentional and unintentional) and,
o Misappropriation of cash and other resources of the
utility.
These objectives are attained through a system of
internal controls which is established and followed by
accounting personnel. Some of the specific characteristics of
a system of internal controls are described below.
1. Separate Accounting Duties
Whenever possible, accounting procedures should be
devised so that no single person handles a particular
transaction from beginning to end. Under this approach
one person can check the work of the other.
I/ For detailed information on utility planning and budgeting, see
"Comprehensive Diagnostic Evaluation and Selected Utility Management
Issues", Office of Water Program Operations, EPA, Washington, D.C.
1982.
39
-------
2. Use and Control Prenumbered Forms
All forms used in the accounting process should have
preassigned numbers in a specific sequence. The forms
can then be accounted for during the day-to-day
accounting routine. Voided forms should be properly
cancelled so their whereabouts are known. This
prenumbered form control procedure helps assure that
accounting transactions are properly recorded in the
accounting system.
3. Approval Signature
A responsible official should sign off on certain
accounting transactions including:
o Issuing of purchase orders;
o Approving of invoices and payrolls for payment;
o Signing checks;
o Depositing cash; and
o Recording journal entries
This approval process fixes final responsibility for
these accounting transactions.
4. Reconcile Subsidiary Records to Control Totals
Totals of subsidiary records should be reconciled to
control totals regularly. Differences must be checked
out and resolved. Key functional areas include cash,
accounts receivable, and accounts payable.
B. Chart of Accounts
The chart of accounts provides the means by which all
accounting transactions are classified and recorded. The
chart of accounts also provides the framework within which
information in accounting records is extracted, summarized and
reported. Accordingly the chart of accounts should allow the
classification of information in a way which:
o Facilitates control of utility assets and liabilities;
and
o Is useful to those who receive financial reports
including internal management, elected officials,
investors, and the public.
To accomplish these objectives, information should be
classified in the same format and level of detail in the chart
of accounts as in the budget.
40
-------
1. Elements
a. Fund: An independent fiscal and accounting entity
with a self-balancing set of accounts recording cash
and/or other resources together with all related
liabilities, obligations, reserves, and equities
which are separated for the purpose of carrying on
specific activities or attaining certain objectives.
b. Type of Account: (Asset, liability, revenue,
expenditure).
c. Organization: The department and any departmental
subdivisions responsible for a particular
expenditure.
d. Activities: The specific services or administrative
functions performed.
e. Objects of Expenditure: The specific category of
cost designed to provide detail on the types of
commodities or services purchased by utilities.
f. Source of Revenue: The type of revenue received.
g. Program or Project: A special classification which
can be used to identify major capital outlay or
Federal projects.
2. Coding
A set of codes must be established to identify each
element in the chart of accounts. The number of elements
included in each classification will depend on the
reporting needs of the utility. See Exhibit 22 for
possible coding. The coding scheme for the chart of
accounts should provide codes for all elements currently
in the structure and make provision for adding new
elements or adjusting existing elements. See Exhibit 23
for a simplified chart of accounts.
C. Accounting Records
Every financial transaction of the municipality should be
recorded in the accounting records.
These records consist of:
o Source documents,
o Books of original entry, and
o Books of final entry.
41
-------
EXHIBIT 22
SAMPLE ACCOUNT CODING STRUCTURE
FUND
10 General
20 Special Revenue
30 Capital ProjecU
40 Enterprise
41 Wastewater Enterprise
SO Internal Service
60 Special Assessment
70 Debt Service
80 Trust and Agency
ORGANIZATION
10 General Government
20 Police
30 Public Works
31 Wastewater Utility
40 Fire
SO Library
60 Health
70 Parks
ACTIVITY*
100 Collection
200 Pumping
300 Treatment
MAJOR OBJECTS
100 Personal Services
200 Operating Expenses
300 Maintenance Expense
310 Preliminary 400 Capital Outlay
320 Primary
330 Secondary
340 Tertiary
350 Sludge
400 General
500 Laboratory
REVENUE SOURCES
10 Taxes
11 General Property
20 User Charges
21 Sewer User Charges
30 Intergovernmental
40 License Permits
SO Departmental Billings
60 Rent
70 Miscellaneous
•Wastewater Only
42
-------
EXHIBIT 23
SAMPLE UTILITY CHART OF ACCOUNTS
WASTEWATER TREATMENT
BALANCE SHEET ACCOUNTS ACTIVITY REVENUE ACCOUNTS EXPENSE ACCOUNTS
Assets Collection General Property Tax Personal Services
Cash Pump User Charges Operating
Accounts Receivable Stations Septage Disposal Maintenance
Due from other Funds Treatment Interest on Investments Capital Outlay
Prepaid Expenses Laboratory Rent
Materials and Supplies General Sale of Equipment
Restricted Assets Intergovernmental
Equipment Department Billings
Utility Plant Sewer Availability Charges
Construction in Progress Connection Fees
Development Fees
Liabilities Special Assessments
Accounts Payable
Due to other Funds
Notes Payable
Bonds Payable
Customer Deposits
Accrued Liabilities
Fund Equity
Contributions
Retained Earnings
Reserves
43
-------
1. Source Document
The details of financial and other transactions are
usually described on documents from parties outside the
utility and prepared within. A purchase of goods or
services, for example, may involve:
o Internal documents; and
Purchase requisition,
Purchase order,
Receiving report, and
Check
o External documents.
Vendor packing slip/shipping documents; and,
Vendor invoices.
These source documents should provide the details of the
transaction. The accounting information is recorded in one of the books
of original entry and the source documents are then filed. Examples of
source documents are deposit slips, receipts for cash received, utility
bills, notes payable and payroll checks.
2. Books of Original Entry
Books of original entry are internal accounting registers
or journals in which accounting information is recorded
from the source documents. Book of original entry
include:
o Cash Receipts Journal. Cash received by the utility
is recorded in this journal,
o Cash Disbursement Journal. Payments made by
the utility are recorded in this journal.
o Payroll Journal. Payroll checks issued are recorded
here.
o Purchase Journal. Purchase orders issued are
recorded in this journal.
o Revenue Journal. Bills issued are recorded in the
revenue journal. and,
o General Journal. Journal entries are recorded here.
44
-------
3. Books of Final Entry
Books of final entry are the principal accounting
records from which financial and management reports are
prepared. These books should classify information in the
same manner as the budget and chart of accounts. The
information in these books is posted from the books of
original entry. The principal books of final entry are:
o General Ledger. The general ledger is a
comprehensive record of the financial activity of
the utility. It contains the current balance
(deficits and credits) for each general ledger
account in the chart of accounts;
o Operating Ledgers. These ledgers maintain detailed
accounting for revenues, appropriations, operating
budgets, encumbrances and expenditures. These are
used primarily in the larger utilities. Specific
ledgers might include;
Revenue Ledger, and
Budget and Expenditures Ledger.
o Payable Ledgers. These contain balances for
individuals or businesses the utility owes money.
They form subsidiaries to various liability
accounts; and
Ledgers Liability Account
Account Payable Ledger Accounts Payable
Bond Payable Ledger Bonds Outstanding
o Receivable Ledgers. These record amounts for each
individual or business that owes the utility money.
Ledgers Control Account
Accounts Receivable Ledger Accounts Receivable
Special Levies Ledger Special Levies Due
D. Interim Financial Reports
Interim financial reports are prepared primarily for
internal use by management and the governing body in the
process of planning and control. These interim reports must
be complete, accurate, clear and timely. Basic interim
reports are:
o The Balance Sheet (see Exhibit 24);
45
-------
SAMPLE BALANCE SHEET
ASSETS
LIABILITIES AND FUND EQUITY
Cash
Investments
Accounts Receivable
Due from other Funds
Prepaid Expenses
Materials and Supplies
Restricted Assets
Equipment
less Accumulated Depreciation
Utility Plant
less Accumulated Depreciation
Contruction in Progress
Liabilities
Accounts Payable
Due to Other Funds
Notes Payable
Bonds Payable
Customer Deposits
Accrued Liabilities
Total Liabilities
Fund Equity
Contributions
Retained Earnings
Reserves
Total Fund Equity
TOTAL ASSETS
TOTAL LIABILITIES AND FUND EQUITY
x
:E
i—i
CO
-------
BALANCE SHEET
Use
Description
Key Data Elements
Data Element Source
Utility manager, municipal
officials and third parties
use this report to understand
the financial position of
the utility at a specific
point in time, typically at
the end of a fiscal year.
This report, in conjunction
with the statement of revenues,
expenses and changes in
retained earnings and the
statement of changes in
financed position are used
by bankers and investors
for bonding and investment
decisions.
The Balance Sheet(Statement
of Financial Position) is one
of three major financial
reports. It reports the
balance of all general ledger
asset, liability and fund
equity accounts.
Net income for the year is
normally added to retained
earnings (losses are subtracted).
Annual depreciation is added
to the accumulated depreciation
by asset category (Equipment
and plant).
1. Asset Accounts
2. Liability Accounts
3. Fund Equity Accounts
1. General Ledger
2. Fixed Asset Records
3. Net Income or Loss
x
re
i—i
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-------
o The Statement of Actual and Estimated Revenues
(see Exhibit 25);
o Summary Statement of Actual and Budgeted Expenditures and
Encumbrances (see Exhibit 26);
o Statement of Actual and Budgeted Expenditures and
Encumbrances, by Department/Activity (see Exhibit 27);
o Cash Flow Results and Forecast (see Exhibit 28);
o The Statement of Revenues, Expenses and Changes in
Retained Earnings (see Exhibit 29); and
o The Statement of Changes in Financial Position (see
Exhibit 30).
1. The Balance Sheet
The Balance Sheet shows the financial position
of the utility at a particular date, usually month
end or year end. It reports the assets,
liabilities, reserves and fund balances.
2. Statement of Actual and Estimated Revenues
The Statement of Actual and Estimated Revenues
is an analysis of the revenues of the current month
and an analysis of the cumulative revenues to the
date of the report. It also indicates the balance
yet to be received to meet the annual estimate. The
comparison of the actual revenues with the estimate
is important to the planning of future budget
estimates. It shows the accuracy of revenue
estimates and provides an early indication of cases
where revenue may exceed or fall short of
expectations. This information allows officials to
alter their planned courses of action accordingly.
3. Statement of Actual and Budgeted Expenditures and
Encumbrances
This statement is used to control expenditures
and allows:
o Comparison of expenditures for the month with
the budget for the month;
o Comparison of year-to-date expenditures to the
budget;
48
-------
UD
Hevenue Sources
User Charges
General Property Taxes
Federal Grants
State Grants
Septic Tank Disposal Fees
Interest Revenue
Rents
Sewer Availability Charges
Connection Fees
Development Fees
Special Assessments
Other
Total Revenue
STATEMENT OF ACTUAL AND ESTIMATED REVENUES
WASTEWATER TREATMENT
Current Month
Estimated Actual
Over
(Under)
Total
Estimated
Year To Date
Estimated Actual
Over
(Under)
Balance to
Be Collected
x
3:
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DO
ro
01
-------
STATEMENT OF ACTUAL AND ESTIMATED REVENUES
Use
Description
Key Data Elements
Data Element Source
Utility manager uses this
report to identify by
revenue account, the
current month and year
to date:
. Estimated (budgeted)
revenue
. Actual receipts collected
• Variances
. Balances to be collected
This report is important to
analyze cash collected from
various revenue sources.
Monthly status-report of
current month and year to
date cash collected com-
pared to revenue budgeted
by revenue source. All
revenue sources (except
bonds) are recorded on
this report, operating
and capital revenue
sources.
This report does not
report billings. Cash
collected is reported
against budgeted
resources.
1. Revenue Budget
2. Cash Collected
3. Revenue Accounts
1. Cash Receipts Journal
2. Revenue Ledger
3. General Ledger
4, Operating Budget
en
o
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x
on
Ql
-------
EXHIBIT t6
Summary Statement of Actual and
Budgeted Expenditures and Encumbrances
For the Month of September, 19xx and Nine Months Ended September 30, 19xx
Department/
Function/
Activity
Wastewater Treatment
Operations
Month of September, 19xx
Jan. -Sept. 19xx
19xx
Appropri-
ation
(Revised)
(D
Actual Actual
Under Under Un-
(Over) (Over) expected Encum-
Budgeted Actual Budgeted Budgeted Actual Budgeted Balance brances
<2> (3) (*) (5) (6) (7) (8) (9)
Unemcum-
bered
Balance
(10)
$L
TOTAL
Administration
Operations
Maintenance
Engineering
Inspections
Customer Service
Debt Service
TOTAL
-------
EXHIBIT 27
Statement of Actual and Budgeted Expenditures
and Encumbrances, By Department/Activity
For the Month of September, 19xx and Nine Months Ended September 30, 19xx
Department/
Object
19xx
Appropri-
ation
(Revised)
(D
Month of September, 19xx
Budgeted Actual
(2) (3)
Actual
Under
(Over)
Budgeted Budgeted Actual
(4) (5) (6)
Jan. - Sept. 19xx
Actual
Under Un- Unencum-
(Over) expected Encum- bered
Budgeted Balance brances Balance
(7) (8) (9) (10)
en
ro
Department Name:
Personal
Services
Supplies
Other Services
and Charges
Capital Outlays
TOTAL
$
$
x
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-------
Cash Flow Results and Forecast
Results for_ and Forecast through
Projected for
Results for (Current Month) (Each Projected Month)
Beginning Disburse- Ending Beginning
Fund Balance Receipts ments Balance Balance Receipts
$ $ $ $ $ $
Disburse-
ments
$
(Additional
Projected
Ending Months)
Balance
$ $ $ $
en
oo
TOTAL-ALL FUNDS
m
x
3:
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-------
CASH FLOW RESULTS AND FORECAST
Use
Description
Key Data Elements
Data Element Source
Utility manager uses this report
to monitor for the current and
subsequent month(s), by fund:
- Beginning and ending balance
- Receipts
- Disbursements
en
This monthly report summarizes
by fund, the receipts, dis-
bursements and beginning and
ending balances. It is an
important report when multiple
funds are used to finance
utility operations such as:
- General
- Special Assessment
- Enterprise
1. Fund Sources
2. Receipts
3. Disbursements
4. Balances
1. Cash Receipts
Journal
2. Cash Receipts
Journal
3. Cash Disbursements
Journal
4. General Ledger
x
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STATEMENT OF REVENUES,
EXPENSES AND CHANGES IN RETAINED EARNINGS
WASTEWATER TREATMENT UTILITY
Operating Revenues
User Chatges
Septage Disposal Fees
Total Operating Revenues
Operating Expenses
Personal Services
Operations
Maintenance
Depreciation
Capital Outlay
Other
OT Total Operating Expenses
en
Operating Income
NonK)perating Revenues (Expenses)
Operating Grants
Interest Revenue
Rent
Sewer Availability Charges
Connection Fees
Interest Expense
Total Non-Operating Revenues (Expenses)
Net Income (Loss)
Retained Earnings July 1
Retained Earnings June 30
-------
STATEMENT OF REVENUES, EXPENSES AND CHANGE IN RETAINED EARNINGS
Use
Description
Key Data Elements
Data Element Source
Utility manager?, municipal
officials, and third parties
use this report to understand
the results of operations
for the period reported,
usually monthly.
This report, in conjuction
with the Balance Sheet and Stat-
ment of Changes in Financial
Position is used by bankers
and investors in their decision
to loan funds to the utility.
This report (also known
as the income statement
or profit and loss
statement) describe by
operating and non operating
categories, the results of
operations for the period. It
reports revenues and expenses
and the impact of net income
(loss) in retained earnings.
The final retained earning
(June 30) is then reported on
the Balance Sheet. This
report is issued monthly.
1. Revenues
2. Expenses
3. Retained Earnings.
1. Cash Receipts Journal
2. Cash Disbursements Journal
3. Calculated Retained
Earnings.
x
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-------
STATEMENT OF CHANGES IN FINANCIAL POSITION
WASTEWATER TREATMENT UTILITY
Sources of Working Capital
Operations
Net Income
Items not Requiring Working Capital
Depreciation
Working Capital Provided by Operations
Cash from Bond Proceeds
Contributions
Total Sources of Working Capital
Uses of Working Capital
Aquisition of Property, Plant and Equipment
Retirement of Bonds
Net Decrease in other Current Liabilities
Net Increase in other Assets
Total Use of Working Capital
Net Increase (Decrease) in Working Capital
x
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-------
o See the unexpended balance of the appropriation
for a given period;
o See the outstanding encumbrances for a given
period. This can be determined by adding the
unpaid purchase orders and contracts for the
utility; and,
o See the uncommitted balance of the
appropriation at a given point in time
4. Statement of Actual and Budgeted Expenditures and
Encumbrances by Department/Activity
This statement shows a detailed listing, by
object code, of expenditures and encumbrances for
each department. It is given to the department head
to assist in controlling departmental expenditures.
5. Cash Flow Analysis
This statement shows the cash position at the
report date and projects what it will be on certain
future dates. These forecast guide utility
personnel in adjusting expenditures to revenues.
This statement enables the utility manager to
anticipate and plan for cash flow problems and
opportunities such as funding capital improvements
and adjusting rates. It also allows the manager to
maximize interest income through investment of idle
funds.
The data for this forecast may come from
several sources. The General Ledger for Cash will
indicate the present balance in each fund. The
estimated receipts from billings and miscellaneous
revenues will come from a study of the previous
year's records. Often times the budget documents
predict income; however, this should be compared to
actual trends. The estimated expenditures should
come from schedules in the annual budget.
6. The Statement of Revenues. Expenses and Changes in
Retained Earnings
This statement is often referred to as the
income profit and loss statement which shows how
much the enterprise earned or lost during a given
period.
59
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7. The Statement of Changes in Financial Position
This describes the source and use of utility
working capital.
These seven statements reflect the essential
minimum information that management must know and
present. Other beneficial financial reports are:
o The Daily Cash Report. This gives the manager
an up to the minute view of the cash on hand in
any fund. The Daily Cash Report is a running
balance of each day's receipts, disbursements,
and new balance during the month. A sample
format is shown on Exhibit 31. and,
o The Investment Record Card. To maximize the
cash available for investment, all incoming
cash must be deposited as soon as possible and
must remain on deposit as long as possible.
Only cash that is temporarily idle is invested.
A readily available, easily understood
investment record is essential to the
investment program. See Exhibit 32 for a
sample Investment Record Card.
The next chapter will discuss areas for
considerations by the utility manager when
considering the acquisition or use of computers
to provide them with management information.
60
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EXHIBIT 31
Sample Daily Cash Report
(Governmental Unit)
DAILY CASH REPORT FOR
DATE
RECEIPTS
CASH BALANCE
DISBURSEMENTS
61
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EXHIBIT 32
Investment Record Card
(Governmental Unit)
Fiscal Year
Description of lnv<
DATE ACQUIRED
SECURITY
jstment:
INTEREST RATE DATE RECEIVED SECURITY LOCATION
t.D. NUMBER
TOTAL
COST
MATURITY
DATE
FACE AMOUNT
PROCEEDS
62
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V. Management Information System (MIS)
Every organization needs reliable and timely information to
plan, manage and control its operations. What was previously a
relatively simple and low-profile "sewerage operation" has now
become a complex, highly visible and capital intensive wastewater
processing industry. Given the significance of this rapid
transformation, the need for increased management planning and
control capabilities and the related management information systems
needed to support those planning and control objectives has become
increasingly evident. A properly planned and implemented MIS will
increase the utility managers ability to:
o Understand and direct daily operations,
o Control utility cost,
o Monitor planned to actual performance,
o Develop alternative approaches to operations, and
o Allocate resources as they are required.
The data required to develop this information is defined in
the various sections of this chapter. This data provides the
source of the MIS. The elements of a MIS discussed in this chapter
are:
o MIS organizational responsibility,
o Policies of report preparation,
o Operational reports,
o Financial reports,
o Management reports, and
o Manual versus electronic data processing.
A. MIS Organizational Responsibility
Responsibility for developing the MIS does not
necessarily require the utility manager to write and prepare
all the required reports. The manager should identify
required information and delegate the responsibility of report
preparation (as appropriate) to the best suited utility and/or
municipal employee. Sections C, D and E list basic required
reports.
B. Report Preparation
The reports outlined in the remainder of this section are
considered necessary for effective utility management.
A utility may require additional management information to
address a certain function or meet requirements unique to that
facility. Caution should be used when management mandates the
preparation of reports or requires information, because
63
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frequently the effort and expense required may offset the
value of the information. Therefore in determining whether or
not information should be provided, the utility manager should
consider:
o Does the report really serve a purpose?
o What will the report tell me?
o Will new or different information be developed?
o What are the consequences if the report does not exist?
o What operation will be simplified or cost saved if the
information is made available?
o Is the same information available elsewhere?
o Does the authority exist to put the information to
practical use?
o How often should this information be available?
o Who would or should be concerned with this information,
and why?
C. Operational Reports
o Plant Performance (See Exhibit 33),
o Maintenance Activity (See Exhibit 34), and
o Energy Cost and Consumption Report (See Exhibit 35).
D. Financial Reports
o Summary Statement of Actual and Budgeted Expenditures and
Encumbrances (See Exhibit 26)
o Statement of Actual and Budgeted Expenditures and
Encumbrances by Department/Activity (See Exhibit 27),
o Statement of Actual and Estimated Revenues (See Exhibit
25),
o Balance Sheet (See Exhibit 24),
o Statement of Revenues, Expenditures and Changes in
Retained Earnings (See Exhibit 29),
o Statement of Changes in Financial Position (See Exhibit
30), and
o Cash Flow Results and Forecast (See Exhibit 28).
E. Management Reports
o Purchase Order Status (See Exhibit 36),
o Vendor File Activity (See Exhibit 37),
o Stock Activity (See Exhibit 38), and
o Employee Profile (See Exhibit 39).
64
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EXHIBIT 33
PLANT PERFORMANCE REPORT
DATE
DAY
OF
(WEEK
RAIN
OR
SNOW
IN.
SEWAGt PLOW
RATE
MAX MIN.
TOTAL
RAW
FINAL
TOTAL
SUSPEND
SOLIDS
RAW
FINAL
EFF.
CHLORINATION
RESIDUAL
MO/1
AJM. I PJM.
SETTLEABLE
SOLIDS ml/1
RAW
RIM.IFINAI
EFF.
IM.FII
OF
FH
D.O.
IMA
EFF.
TKN
RAW
FF.
TOTAL
NITROGEN
EFF.
TOTAL
PHOS-
PHORUS
RAWJ'NA
10
11
12
13
14
IS
IT
IS
18
20
21
22
24
26
27
30
31
WEEK
•ODmg/l
RAW EFF.
FECAL
COLIFORM
PER 100 ml
EFFLUENT TURBITY OTHER OR SPECIAL ANALYSIS
SEPTIC WASTES
AVE.
AVE.
AVE.
AVE.
AVE.
AVE.
AVE.
AVE.
AVE.
REMARKS: CHLORINE OR POWER OUTAGES. LOST TIME. ACCIDENTS. ETC.
65
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PLANT PERFORMANCE REPORT
(Monthly)
USE
DESCRIPTION
KEY DATA ELEMENTS
DATA ELEMENT SOURCES
Utility Managers use this
report to:
Summarize results of
daily operating records.
Summarize results of daily
laboratory analysis.
Identify variations in
plant performance.
. Report to regulatory
agencies on compliance.
Monthly plant performance re-
port of physical operations
summarizing the analysis of
key parameters used to monitor
plant efficiency & compliance.
1. Rainfall
2. Sewage Flow
3. Chlorination
4. Settlable Solids
5. ph
6. Total Suspended Solids
7. Dissolved Oxygen
8. Biochemical Oxygen Demand
9. Coliform
10. Remarks
1. Rain Cage
2. Flow Meter Records
3. Operator Log & Lab Reports
4. Laboratory Reports
5.'Laboratory Reports
6. Laboratory Reports
7. Laboratory Reports
8. Laboratory Reports
9. Laboratory Reports
10. Operator Logs
X
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CO
QJ
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MAINTENANCE ACTIVITY REPORT
(Weekly)
WORK ORDER
NUMBER
en
DESCRIPTION
TYPE OF
ACTIVITY
REQUESTED
START DATE
ACTUAL
START DATE
SCHEDULED
COMPLETION DATE
ACTUAL
COMPLETION DATE
ESTIMATED
COST
ACTUAL
COST
m
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MAINTENANCE ACTIVITY REPORT
(Weekly)
USE
DESCRIPTION
KEY DATA ELEMENTS
DATA ELEMENT SOURCES
Jtility managers use this
report to:
Identify types of mainten-
ance activities being
performed.
Identify delays in starting
or completing scheduled
maintenance.
Identify maintenance cost
by activty and variation
from cost estimates.
oo
A weekly status report of main-
tenance activities.
Should contain both scheduled
preventive maintenance and
corrective maintenance activities
Work order number
Type of activity
Requested start date
Actual start date
Scheduled completion date
Actual completion date
Estimated cost
Actual cost
1. Work order
2. Work order or main-
tenance log
3. Weekly maintenance
schedule
4. Work order or main-
tenance log
5. Maintenance schedule
6. Work order
7. Work order
8. Work order
x
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ENERGY COST AND CONSUMPTION REPORT
FACILITY OR OPERATING UNIT:
MONTH:
CD
10
u
s
A
G
E
P
R
I
C
E
C
0
S
T
P
E
R
F
0
R
M
A
N
C
E
USAGE (YEAR TO DATE)
BASE YEAR TO DATE
PERCENT ABOVE (BELOW) BASE YEAR
PRICE PER ENERGY UNIT (CURRENT MONTH)
BASE YEAR COST PER ENERGY UNIT
PERCENT ABOVE (BELOW) BASE YEAR
COST (YTD) DOLLARS
BASE YEAR COST (YTD)
PERCENT ABOVE (BELOW) BASE YEAR
USAGE PER 1000 GALLONS OR POUND
OF BOD REMOVED, ETC.
BASE YEAR USAGE PER LOGO GALLONS
PERCENT ABOVE (BELOW) BASE YEAR
COST PER 1000 GALLONS OR POUND
OF BOD REMOVED, ETC.
BASE YEAR COST PER 1000 GALLONS
PERCENT ABOVE (BELOW) BASE YEAR
ELECTRIC
GAS
OIL
OTHER
TOTAL
X
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ENERGY COST AND CONSUMPTION REPORT
(Monthly)
USE
DESCRIPTION
KEY DATA ELEMENTS
DATA ELEMENT SOURCES
Utility managers use this
report to:
Identify energy usage with
facility.
Identify energy cost, both
unit cost & total cost.
Evaluate performance
indicators.
Evaluate the success of
energy conservation options
A monthly report that summarizes
energy usage and cost for the
facility.
The report also reports on
performance targets and compares
them with previous years results
to evaluate the success of
energy conservation options.
Energy usage
Base year to day
Price per energy unit
Base year cost
Cost (YTD)
Base year cost
Performance indicators
(usage/1000 gal; $/1000 gal
1. Utility bills, vendor
invoices, facility
recording meters.
2. Previous monthly energy
reports.
3. Utility bills, vendor
invoices.
4. Previous energy usage
reports.
5. Current & previous
monthly reports.
6. Previous montlhly reports,.
7. Plant performance report,
utility bills, vendor
invoices.
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Report
For the period
PURCHASE ORDER STATUS REPOuC
Vendor Volume
P. 0. Number Vendor Name Number Ordered Commodity Name
1)
1099 White Bearing 140 20
30
1099 Order Total
Month total 1 P.O. issued
1" Bearing
2" Bearing
50
50 units ordered
Issued to:
Commodity Unit Order Receipt Receipt
—Case Price Date Amount Date Expense
604
608
$1.33
$1.41
5/11/81
5/11/81
10*
30
5/27/81
5/27/81
Received 40*
$13.30
42.30
$55.60*
outstanding amount $68.90
40 units $55.60
2) 1099
White Bearing 140
5/11/81
3) 1099
1099
White Bearing 140 20 1" Bearing
White Bearing 140 30 2" Bearing
604
608
5/11/81
5/11/81
x
re
^Partial shipment/payment
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PURCHASE ORDER STATUS REPORT
(Prepared Monthly)
Report Use
Description
Key Data Elements
Data Element Source
Facility Manager uses this
report to:
Identify and expedite
overdue orders
Identify orders which
should be blanket or
stock item orders
Identify rapidly in-
j^j creasing unit prices for
- possible vendor switch
- possible replacement
part buying
- possible bulk or joint
buying
Identify chronic late
delivery orders & vendors
Provide data for next
month or years purchasing
planning
Monthly status report of
open, received unremitted and
prior month remittances for
ordered items. Report is in
three parts.
1. Sequential list of open
and prior month paid, P.O.'s
by P.O. number. All other
data is represented
2. Alphabetical list of
vendors with vendor number and
index reference to applicable
open P.O.'s.
3. Sequential list of commodities
by commodity number with index
reference to open P.O.'s.
Note: Reports 2 & 3 are designed
for Electronic Data Processing
Systems. Index filing of P.O.
copies will provide the infor-
mation in a manual information
system.
1. Purchase Order
Number
2. Vendor Name
3. Vendor Number
4. Volume Ordered
5. Commodity or Part
Ordered
6. Commodity Code
7. Unit Price
8. Order Date
9. Receipt Date
10. Receipt Date
11. Expense Amount
1. Purchase
2. Purchase Order/Vendor File
3. Purchase Order/Vendor List
4. Purchase Order
5. Purchase Order
6. Purchase Order/
Commodity List
7. Purchase Order/Quote
8. Purchase Order
9. Purchase Order/Receiving
Copy
10. Purchase Order/Receiving
Copy
11. Purchase Order/Account-
ing Copy
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Report //:
For the Period
VENDOR FILE ACTIVITY REPORT
Issued to:
Vendor
Number
14 D
Vendor Name
White Bearing
Total YTD
Vol.
Ordered
12
4
20
36
Commodity Name
1" Bearing
1" Bearing
1" Bearing
1" Bearing
Commodity
Code
604
604
604
604
Order Dates
2/3/81
4/1/81
5/11/81
Unit Price
1.30
1.33
1.33
1.32
Expense
Amount
15.60
5.32
26.60
47.52
X
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VENDOR FILE ACTIVITY REPORT
(Semi-Annually or on Demand)
Report Use
Description
Key Data Elements
Data Element Source
Facility manager uses this re-
port to:
Identify orders which should
be blanket or stock item
purchases
Identify opportunities for
vendor consolidation
Identify vendor disparities
A semi annual report which in-
dicates the volume and dollar
amount of purchases from each
vendor. The report is sorted
alphabetically by vendor with
each commodity volume order
listed and totaled by 6 month
periods.
Note: Summary cards by vendor
may be maintained if EDP capa-
bilities do not exist. Utility
management should review each
vendor card in lieu of this
input.
1. Vendor Number
2. Vendor Name
3. Volume Offered
4. Commodity Name
5. Commodity Code
6. Order Date
7. Unit Price
8. Expense Amount
1. Purchase Order/Vendor
File
2. Purchase Order
3. Purchase Order
4. Purchase Order
5. Purchase Order/Commo-
dity List
6. Purchase Order
7. Purchase Order/Quote
8. Purchase Order/
Accounting Copy
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STOCK ACTIVITY REPORT
Report # Issued to;
For the Period
Commodity Re der Ending
Number Point Commodity Name Beginning Balance Purchases Units Balance on Hand Inventory
Units _ Unit Cost Units Unit Cost Issued Units Unit Cost Balance
604 22 1" Bearings 4 1.29 20 1.33 19 8 $ 10.64
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STOCK ACTIVITY REPORT
(Semi-Annually or on Demand)
Report Use
Facility manager uses this re-
port to:
Identify overstocked and un-
derstocked items
Identify items which should
be on hand in inventory
rather than order materials
Identify duplicate stock
Determine value of inventory
CTl
Description
A monthly report which shows
the movement of inventory and
stock items from the point of
order through receipt and use.
The report shows balances and
value by commodity, and reorder
point.
Note: Summary cards by commodity
may be maintained if EDP capa-
bilities do not exist. Utility
manager should review each card
in lieu of this report.
Key Data Elements
1. Commodity Number
2. Reorder
3. Commodity Name
4. Beginning Balance
Units
5. Beginning Balance
Unit Cost
6. Purchased Units
7. Purchased Unit Cost
8. Issued Units
9. Balance on Hand Uni
10. Balance on Hand Uni
Cost
11. Ending Inventory
Balance
Data Element Source
1. Purchase Order/Vendor
File
2. Inventory Ticket
3. Purchase Order
4. Prior Month Report
5. Prior Month Report
6. Purchase Order
7. Purchase Order/Quote
8. Inventory Ticket
9. Calculated
10. Calculated
11. Calculated
X
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01
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Report //
For the Period
EMPLOYEE PROFILE
Issued to:
Name
M. L. Operator
Date of Hire
Career Profile
Date Classification
Training
12/9/73 12/9/73
2/8/74
6/30/75
6/30/78
7/30/80
8/1/81
Laborer I
Operator I
Operator II
Operator III
Chief Operator
Superintendent
48
3/1/75
6/12/76
7/18/78
1/5/80
6/30/80
12/31/80
6/30/80
6/30/81
V^UUl. OC:
Sacremento
Certified
Level I
Certified
Level II
Certified
Level III
Certified
Level IV
3 cr hours
Mech Eng
3 cr hours Shop
Mgmt
3 cr hours
Accounting
3 cr hours
Chemistry
X
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EMPLOYEE PROFILE REPORT
(Semi-Annually or on Demand)
Report Use
Description
Key Data Elements
Data Element Source
Utility manager uses this
report to:
Monitor employee develop-
ment
Identify management train-
ees
Monitor personnel policy
compliance
Identify training require-
ment
Match job requirements to
classification level
A semi-annual report prepared
by the utility clerical function
which profiles the training and
career, job development path
of an employee. Employees are
listed alphabetically with all
historical data included for
the length of the employees tenure.
Note: This report is designed
for a manual system. Each
year can be an extension of the
prior year report and a master
sheet would be kept in each
employee file.
1. Name
2. Date of Hire
3. Career Profile Date of
Job
4. Career Profile Type
Job Status Change
5. Training Hours
6. Training Course Title
or description
1. Personnel File
2. Personnel File
3. Personnel File
4. Personnel File
5. Personnel File
6. Personnel File
00
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F. Management vs Electronic Data Processing
1. Defining Alternatives
The above sections have discussed utility management
information needs and the types of data which address
those needs. The types of systems used to record and
accumulate the information can be ma..ual or automated or
a combination of both.
o Manual Data Processing is typical for the 15-20
mgd or less utilities. Some electronic data
processing (EDP) may exist for such areas as
billing, acccounting and budgeting but seldomly is
EDP available for plant operations and maintenance
systems. Most utilities are "Forms" oriented and
month end reports are prepared by lab technicians,
maintenance supervisors and operators.
o Electronic Data Processing (EDP) is becoming more
popular in utility operations and management. Some
utilities utilize EDP to control purchases, record
and maintain inventories etc. The intention of this
section is to provide insight into alternatives and
decisions required when considering EDP.
Basically, there are two types of EDP a utility can
consider:
Inhouse Computer - where the computer,
terminals, printers programs and operators are
on the premises supporting management needs. A
further breakdown of choices exists as well,
whether to buy packaged or develop inhouse
software (programs).
oo Packaged Software - is generally available
in the marketplace from a variety of
vendors and depending on the compatability
with the inhouse hardware, (computer,
terminals, printers, etc.) may provide the
types of data storage, manipulation and
reporting desired.
79
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oo Developed Software - is available from a
consultant or specialized firm and is
"tailor made" to the unique requirements
of the system user (utility management).
Service Bureau Support - or a service obtained
from an outside concern. The service bureau
generally picks up and processes utility data
(batch type processing) or provides the utility
with a computer terminal and printer to input
and output their own data direct to/from the
computer system (on-line type processing). In
either case the utility generally "buys time"
from the service bureau and avoids capital
expense for hardware and software purchase and
large operating expenses with personnel,
supplies, insurance, security and related
items. Exhibit 40 profiles some advantages and
disadvantages of service bureau versus in-house
EDP.
Types of Software
Regardless of the type of EDP service selected
(inhouse or service bureau), the utility should obtain
basic capabilities or program services (subsystems). The
following is a list of capabilities currently available:
o Accounting Applications
General ledger reflects in summary and in
detail the financial position and results of
operations of the utility.
Encumbrance accounting reflects the obligations
in the form of purchase orders, contracts or
commitments which are chargeable to an
appropriation and for which a part of an
appropriation is reserved.
Accounts payable reflects liabilities on open
account owing for goods and services received
by the utility.
Accounts receivable reflects unpaid billing
from residential, commercial and industrial
users, as well as outstanding miscellaneous
billings.
Equipment records is a historical collection of
the purchase price, description and cost
history of wastewater works and equipment.
80
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Advantages and Disadvantages of Service Bureaus vs. In-House Computer
ALTERNATIVE
In-house computer
CO
ADVANTAGES
Direct control over data processing operations
Direct control over implementing system changes
and/or modifications
Direct control over processing schedules
Operating costs are relatively fixed varying
based on the number of applications and re-
lated transaction volumes
Ability to add additional applications at
minimal incremental costs.
DISADVANTAGES
Requires own EDP staff
Substantial initial cost for
hardware/software aquisition
Increased operating costs for
-space
-operating supplies
-insurance
Recurring annual cost for
hardware maintained and soft-
ware licensing
Average life of hardware/soft-
ware is 5-7 years before it
becomes outmoded
Must develop operations,
security and control procedures
Service Bureau
Using hardware/software resources without
significant initial investment
In-house EDP staff not required
Requires less management to control per-
formance
No need to develop data processing operating
standards, security procedures, control
procedures
No control over data processing
operations
No control over implementing
system changes and modifications
Little control over production
schedules
As number of applications and/
or transactions volumes of
existing applications increase
costs could TDecome prohibitive
-------
o Personnel Applications
Payroll calculates the utility payroll and
generates checks and registers and data for
input to the general ledger.
Employee Profile provides storage of employee
related data including date of hire,
compensation and promotion history and training
experience.
o Utility Management Applications
Unit Process Tracking collects and stores
various operating data such as influent and
effluent volumes, process control measures,
removal rates, etc. It provides the ability to
report periodically by unit process and
presents comparative trend analysis and related
management reports.
Purchasing and Inventory is a purchase order
driven inventory management system with
standard parts listing of present and
historical volumes and values, reorder points,
etc. This application would include purchase
order status tracking and provide accounting
data as required.
3. The Selection Process and System Development
The evaluation of manual versus electronic data
processing is a complex task. The basis for selection is
a cost/benefit analysis of operating either system. This
analysis is conducted based on the following two
criteria:
o What is the alternative's ability to satisfy user
management information requirements?
o What alternative satisfies the most user
requirements for the least cost or most benefits?
As the following paragraphs explain, the
cost/benefit analysis is very complex and it is suggested
a third party (external to the potential hardware,
software vendor and the utility) be contacted to assist
in the many and varied technical areas.
82
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In order to obtain the proper data to perform a
cost/benefit analysis (as indicated in Exhibit 41), a
series of steps must be performed; these steps are called
System Development.
STEP I: Define Requirements - The analysis of the
present system and identification of new system
requirements. This step includes:
o Identification of system objectives (provide timely
accurate management information);
o Definition of analytical benefits (labor savings,
automation of user charge billing);
o Identification of major source records; inputs and
reports; outputs (equipment records fixed asset
inventory); and
o Description of available hardware and software to
satisfy system requirements (printers, terminals,
central processing).
STEP II: Review Available Resources - Consideration of
in-house or service bureau. Major areas to review
include:
o Sophistication of utility's data processing
facilities information requirements;
o Availability of financial and personnel resources;
and
o Degree of existing computerization.
STEP III: Prepare and Transmit Request for Proposal
TRFP) - This would be conducted if the utility had little
or no available computer resources or if the utility was
not able to satisfy the information requirements as
defined in Step I with the resources as outlined in Step
II. The RFP is a tool to solicit proposals from vendors
for products to meet the system requirements. Major
elements of the RFP are listed in Exhibit 42.
STEP IV: Define Manual System Cost - Current or proposed
manual system cost must be identified to provide a
"benchmark" or comparative cost for analysis. These cost
include:
o Manpower cost,
o Equipment cost,
o Forms cost, and
o Storage space cost.
83
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EXHIBIT 41
COST/BENEFIT ANALYSIS
Manual vs. Alternatives of Electronic Data Processing
1982
1983
1984 198x
EDP Costs:
Development (start-up)
Third Party
Equipment (hardware)
Other One-Time Costs
Recurring Costs:
Personnel
Supplies
Fees, etc.
Total Costs
Cumulative Total Costs
Manual Cost Savings or Benefits;*
Personnel
Rental/Service Bureau Charges
Sale of Obsoleted Equipment
Operating Savings
Total Benefits/Savings
Cumulative Benefits/Savings
Discounted Cumulative Costs
Discounted Cumulative Savings
Net Cumulative Discounted Savings
*from improved management information
84
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EXHIBIT 42
RFP: Vendor Proposal Contents
1. Hardware description with complete specifications.
2. Detailed description of operating system, utility programs, and supported
programming languages
3. Complete pricing - monthly and yearly costs
Recurring costs
Onetime costs
4. Growth capabilities of the proposed system
5. Vendor services
Field engineering
Systems engineering
6. References
Number of systems installed nationally, locally, locally within
your industry
Three specific local references which can be interviewed
7. Description of the installation methodology the vendor would use to install
the new system
Proposed delivery time
Software development if required
Installation and conversion assistance
8. Software Development
Estimated programming costs
Development time
If program packages are to be used, what is the flexibility of
modifying and tailoring the programs?
How easily can the programs be upgraded and enhanced as requirements
change?
9. Personnel and training requirements
Proposed education plan
Where are facilities located?
Assistance in obtaining qualified personnel
10. Description of testing and backup facilities
11. Manufacturer balance sheet
12. Sign-off, acceptance procedures
13. Contractual relationships
85
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Consider not only first year expenses, but project the
cost over a 5 - 7 year time frame.
STEP V: Vendor Proposal Evaluation - The selection of a
vendor is based upon a comprehensive evaluation of the
information contained in the vendor's proposal, the
ability to demonstrate hardware and software (when
appropriate), and the information obtained from reference
checks of present users.
The following paragraphs contain guidelines for
conducting this step of computer evaluation and
selection.
o Initial Proposal Review
The objectives of the initial proposal review
are to determine the degree of compliance with RFP
instructions, identify missing items of information
and to determine the scope of proposed hardware and
software configuration in terms of size, potential
implementation problems and costs. Review each
proposal to determine the scope of the hardware and
software configuration proposed. Eliminate from
further consideration those vendors who have made an
unreasonable offer compared to the other offers
received.
o Vendor Elimination
Comprehensive evaluation of vendor is a
laborious and complex process. The preceeding
paragraphs described some techniques for eliminating
vendors from further consideration. Additional
vendors may be eliminated because they cannot meet
the essential requirements described in the RFP.
o Demonstrations
Vendor demonstrations can provide valuable
input to the review process because they allow the
evaluators to observe whether or not a proposed
feature or capability works as described in the
vendor's proposal. The following guidelines may be
helpful:
Select the features and capabilities to be
demonstrated based upon the contents of the
vendors proposal;
86
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Communicate the requirements for a
demonstration to the vendor in writing to avoid
misunderstanding;
Document the expected demonstration results
prior to the demonstration; and
Observe the demonstration and document the
results.
STEP VI: Define Automated System Costs - A comprehensive
cost analysis for each qualified vendor must be
conducted. In evaluating the vendors consider both
initial and operating cost for a period of 5 - 7 years as
indicated below:
o Initial Costs
Purchase price for hardware and software,
Supplies,
Freight,
Site planning and preparation,
Training, and
Field engineering cost to install.
o Operating Costs
Personnel (the number of individuals required
to operate the system may vary for each
configuration),
Forms,
Hardware maintenance,
Software maintenance, and
Hardware components (terminals, disk storage,
etc.).
STEP VII: Manual Versus Automated System Cost Analysis
Exhibit 41 illustrates the system selection decision
based on cost of manual versus electronic data
processing. The 5 - 7 year cost projection should be
discounted or reduced by a reasonable rate of interest
over time to bring all data to present day value. The
alternative which meets the most requirements for the
least cost should be selected.
87
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STEP VIII: Bring Development to Closure
If a manual system is selected, an implementation
team should be developed. If an electronic data
processing solution is selected, it is advisable to
retain the services of an experienced management
consultant.
Listed below are considerations for use in assessing
contract terms between a computer vendor and yourself:
o Avoid artificial deadlines in developing schedules;
o Identify practical due dates where possible;
o Designate and delegate implementation
responsibilities;
o Define, to the extent possible, specific
deliyerables and when they are due;
o Specify acceptance criteria and/or conditions under
which testing occurs;
o Require all representations to be in writing;
o Define specific warrantee terms and durations of
coverages;
o Specify default conditions and their results;
Define and agree upon limitations of liability
and/or recourse;
o Identify required/available training and other
related support;
o Identify the nature and schedule for delivery of
documentation; and
o Be sure to include both hardware and software cost
and provide, if possible, hardware buy-back terms.
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