Examinations are done to assure Kansas grain producers that their commodities are being stored in safe, solvent warehouses.  Any entity that stores grain for the public must be licensed by either the state or the federal government.  One advantage of the state license is that it requires that each licensee be examined once a year between July 1 and June 30. Facilities meeting only the minimum financial requirements, or facilities with serious compliance problems, are examined more than once during the year.

During the examination, a list of all open store customers and their stored bushels is printed.  This figure is matched with the elevator’s position report.  The position report gives a breakdown of all commodities in the warehouse's possession.  This report also lists the amount of grain owned by the warehouse. 

Once reports are obtained, the examiner begins measuring the facility. After measuring, the results are compared to the warehouse's book stock from his position report.  If the warehouse’s book stock exceeds the measured inventory by more than 500 bushels and 1%, the warehouse operator is required to write down company owned grain until the stocks are in balance.  If the warehouse operator does not have sufficient company owned grain, he is required to purchase sufficient stocks to come into balance. 

Several other items are checked at the facility during the examination.  Along with open storage, the warehouse receipts, terminal storage, and unpaid grain are all balanced.  Deferred price and payment contract are reviewed to verify that their format complies with Kansas Law. 

Scale tickets are randomly selected and tested to make sure that are no irregularities.  Facilities are evaluated for safety and cleanliness.  Stock insurance policies are reviewed.  Grain quality is evaluated.  If problems are discovered, they are brought to the attention of the warehouse operator to correct.  Between the warehouse operator, the examiner and the office, a plan is developed to correct any problems that arise.  In some cases, more frequent examinations are necessary to ensure that the warehouse comes into and remains in compliance. 

Examinations may be classified as:

  • Subsequent – This is the yearly examination required by law.  Eighty-five percent of the program’s time is used to complete this task.
  • Special – This is an examination done at the request of the warehouse operator.  This may be for a year-end audit, a change in management, or some other circumstance.    These are always at the expense of the licensee.
  • Original –This is used when a new facility comes on board or a licensee builds a new tank or building.  The tank or building is measured while it is empty to ensure accurate numbers are gathered and the correct amount of bushels is reported during an examination.
  • Accelerated – This is the type of examination done when compliance has not yet been achieved.  These may be done at the expense of the licensee.