On a building site, materials are money. Cement, steel and fittings arrive in trucks, move around the site and leave as part of the work. Without control, quantities go missing, deliveries are paid twice and nobody can say what is in store. A gate pass and a material store are old ideas that still work. This guide explains how to run them so that the accounts and the site agree.
What a gate pass does
A gate pass is a record of material crossing the gate:
An inward gate pass is the record of material arriving from a supplier. It notes what came, how much, from whom and who received it. Material leaving the site, for example returned goods, should be recorded just as carefully.
It is the first record of a delivery, made when the truck is there, not a week later.
What a material store does
The store holds what has arrived and not yet been used. It answers:
- What do we have on site right now?
- What was issued to which part of the work?
- What is left of a delivery?
Why accounts and site must agree
Three problems appear when the site and the office keep separate records:
- Paying for what did not arrive. The bill is paid on the supplier's word.
- Not paying for what did. The delivery was never reported to the office.
- Overuse. More material is issued than the work needed, and no one notices.
Matching the gate pass to the supplier bill closes the first two. Comparing issues with the work done closes the third.
A simple site routine
- Record every delivery at the gate, with the quantity counted, not the quantity on the challan.
- Check it against the purchase order if there is one.
- Put it in the store, and record every issue with the part of the work it went to.
- Count the store at fixed intervals and record differences with a reason.
- Match the supplier bill to the gate pass before paying.
Common mistakes
- Recording the challan, not the count. The challan shows what the supplier says, not what arrived.
- No record of issues. The store then shows what came in, not what is left.
- Letting the same person receive and pay. Separate the roles.
- Late entry. A gate pass entered a week later is a memory, not a record.
How OneAccounts does it
The Material management add-on provides an inward gate pass screen for material arriving, and a material store. It is available for construction companies. Use it together with purchase orders, so that a delivery can be compared with what was ordered, and with the site budget, so that the cost of what is bought is checked against the plan.
Material management is an optional add-on. See Construction accounting software and purchase order to vendor payment for contractors.
Frequently asked questions
Is a gate pass the same as a purchase order?
No. A purchase order is a request to buy. A gate pass records that the material actually arrived or left.
Who should receive material at the gate?
Someone who is not the person who approves payment, so that the receipt is an independent record.
How often should the store be counted?
For active sites, weekly for the main materials and fully each month. Record any difference with a reason.
Does it record what the supplier delivered?
Yes. The inward gate pass records the delivery at the gate, so it can be compared with the supplier bill.
Do I need this add-on for a small site?
Not necessarily. It is useful when materials are a large share of your cost and several people handle them.