The bill of lading is a required document to move a freight shipment. The bill of lading (BOL) works as a receipt of freight services, a contract between a freight carrier and shipper and a document of title. The bill of lading is a legally binding document providing the driver and the carrier all the details needed to process the freight shipment and invoice it correctly.
Freightquote by C.H. Robinson can improve the efficiency of your business by automatically creating bills of lading during the quoting and booking process. The BOL should be provided to the carrier on pickup, as well as attached to the packaged freight.
Sample freight bill of lading.
What's in a freight bill of lading?
Names and addresses: The full names and addresses of both the shipper and receiver (consignee) should be legible and easy to locate on the document.
Purchase orders or special reference numbers: These numbers may be important to your business or a necessary reference in order for freight to be released for pickup or accepted at delivery.
Special instructions: Here is where you will note instructions for the carrier that are not extra service requests like liftgate or delivery notification.
Date: This is the pickup day, and it may be needed as a reference to track your freight or when you reconcile shipping invoices.
Description of items: Shippers should note the number of shipping units, the dimensions and weight, as well as information about the material and its makeup.
Packaging type: Note whether you are using cartons, crates, pallets and/or drums when shipping.
NMFC freight class: Freight classes can impact the cost of your shipment. Freight shipments are broken down into 18 classes based on weight, dimensions, density, storage capability, ease of handling, value and liability.
Department of Transportation hazardous material designation: Hazardous shipments must be clearly cited and special rules and requirements apply when shipping.
Bill of Lading Explained
The bill of lading is a legally binding document that provides the carrier and shipper with all of the necessary details to accurately process a shipment. It has three main functions. First, it is a document of title to the goods described in the bill of lading. Secondly, it is a receipt for the shipped products. Finally, the bill of lading represents the agreed terms and conditions for the transportation of the goods.
Segregation of Duties
Every business needs to have internal controls in place to prevent theft. One key component of internal control is segregation of duties, which prevents one employee from having too much control within a business.
No two internal controls systems are the same. However, most follow a standard set of core philosophies and have become standard management practice. The implemention of internal controls can help streamline operations and prevent fraud.
Real World Example
A bill of lading is one of several key documents that must be properly managed and reviewed to prevent asset theft. Assume, for example, XYZ Fine Dining receives shipments of fresh meat and fish five times a week. The restaurant manager determines the type and amount of meat and fish the restaurant needs to order. He then fills out a purchase order, and XYZ’s owner reviews and initials each PO before it is emailed to the food vendor. The vendor gathers the meat and fish, and both he and a representative from the overnight carrier sign a bill of lading.
Next, the carrier delivers the food to the restaurant, and the manager compares the information on the bill of lading to what he requested on the PO. If the information matches, the PO and the bill of lading are sent to the owner, who reviews the documents and writes a check payable to the food vendor.
In this example, the owner does not issue a check to the vendor without reviewing the purchase order (PO) and the bill of lading. This step ensures XYZ only pays for what it ordered and what it received. If the two documents do not match when the restaurant manager compares them, the manager will ask the vendor about the exception. A third employee reconciles the bank statement and makes company deposits. All of these steps must be in place to prevent theft.