item inside the container and must remain with the item until it is through processing. DISPOSITION OF MTIS.— After  screening  and identification  processes  have  determined  that  the material is in any one of the four categories listed above, the material and documents are distributed as described in the following paragraphs. Material for transfer to DRMO fall into one of three categories. They are items that need inventory manager disposal authority, items that do not need disposal authority, or scrap and waste. Material determined to be  in  the  category  for  transfer  to  DRMO  is  forwarded to the disposal or shipping section for further action or delivered directly to DRMO. The document used for transferring material to DRMO must contain a Disposal Authority Code. Disposal authority code M is assigned for transfers authorized by the item manager. Code N is assigned for material that is not reportable by virtue of an exclusion to the MRP of NAVSUP P-437 or other specific  criteria  such  as  extended  dollar  value  or condition  limitations  on  excess  reporting  and  are  duly authorized  to  be  transferred  to  DRMO.  Code  N  is assigned for material that has been reported to inventory manager/inventory  control  point  according  to  the Material  Returns  Program  described  in  NAVSUP  P-437 and  are  excess  to  authorized  retention  levels.  Code  N is   used   when   disposal/action   complies   with Service/Agency  Instructions.  The  items  transferred  to DRMO must be accompanied by a minimum of three copies of DD Form 1348-1. Personnel accepting the material  should  receipt  for  the  items  and  forward  one copy of the signed receipt document to the transferring activity  or  the  bearer.  When  DRMO  acknowledges receipt of material, the shipping activity should prepare and submit a shipping status (DI AS3), with distribution code  9  in  record  position  54,  to  the  Defense Reutilization and Marketing Service (DRMS). Refer to Appendix  B  of  NAVSUP  P-437  for  the  format  in preparing  document  identifier  AS3. Material for stock storage. Material determined to be  in  the  category  for  storage  is  forwarded  to  the appropriate storage location with a minimum of two copies of the DD Form 1348-1. PROCESSING  REPAIRABLE  MATERIAL.— Each  shore  activity  supporting  fleet  units  or  dependent activities should establish a specific location for turning in  repairable  MTIS  items. The   shore   activity   should   furnish   additional packaging when the need is indicated on the DD Form 1348-1, or when the condition of the containers shows an obvious lack of protection and additional packaging is  required.  When  additional  packaging  is  not  requited, material   turned   in   for   transshipment   should   be forwarded directly to the transportation section for processing. MTR items take precedence over all other MTIS, provided they are properly identified, Critical items turned in on a priority 03 (transportation priority 1), and may be identified as RED STRIPE, must be processed immediately  upon  receipt.  Items  of  short  supply turned-in on priority 06, and maybe identified as BLUE STRIPE,  must  be  processed  immediately  as  resources permit.  If  transshipment  is  required,  premium transportation, including air shipment, is authorized for RED STRIPE and BLUE STRIPE material. process material shipments according to Military Standard Transportation   and   Movement   Procedures,   DOD 4500.32-R. Screening  by  consignee  activity  to  verify  accuracy of  identification  or  consignment  of  documented turn-ins should be performed selectively as required according  to  NAVSUPINST  4419.2.  Screening  to verify adequacy of packaging should be limited to a visual inspection to determine if the DD Form 1348-1 indicates a need for additional packaging (block GG marked Packaging Required) or if the condition of the material or container indicates an obvious need for additional  packaging.  MTR  material  received  without documentation  or  with  inadequate  documentation should be forwarded to the screening section for further processing. Discrepancies noted should be reported according   to   NAVSUPINST   4440.179   or NAVSUPINST  4610.33. MATERIAL RECEIPT AFLOAT The material receipt process afloat involves the identification,  storage,  issue,  and  recording  of  all material previously requisitioned or purchased and received  by  the  activity.  As  an  integral  part  of  the supply receipt process, all material received must be properly identified, stored (if the material is for stock), issued (if the material is for DTO), and recorded in the stock records through SUADPS-RTin a timely fashion. The receiving process is apart of the supply support operation cycle. Receipt processing interfaces with other   supply   functions   such   as   procurement, expenditure,   and   inventory   management.   The 3-11