MUST KNOW TO COST ACCOUNTANTS

Statutory / Legal Compliances Related to Costing Division

Forms Related to Cost Audit:

1.      Appointment of Cost Accountant: Form 23C

2.      Information by Cost Auditor to Central Govt.: Form 23D

3.      Filing of Cost Audit Report : FORM – I

4.      Form of the Cost Audit Report : FORM – II

5.      Form of Performance Appraisal Report : FORM - III

Annexure to the Cost Audit Report:

1.      General Information

2.      Cost Accounting Policy

3.      Product Group Details (for the company as a whole)

4.      Quantitative Information (for each product group Separately)

5.      Abridged Cost Statement ( for each product group separately)

6.      Operating Ratio Analysis ( for each product group separately)

7.      Profit Reconciliation (for the company as a whole)

8.      Value Addition and Distribution of Earnings ( for the company as a whole)

9.      Financial Position and Ratio Analysis ( for the company as a whole)

10.  Related Party Transactions (for the company as a whole)

11.  Reconciliation of Indirect Taxes ( for the company as a whole)

Indicative list of Areas to be covered in the Performance Appraisal Report

1.      Capacity Utilization Analysis

2.      Productivity / Efficiency Analysis

3.      Utilities / Energy Efficiency Analysis

4.      Key-Cost  & Contribution Analysis

5.      Product / Service Profitability Analysis

6.      Market / Customer Profitability Analysis

7.      Working Capital & Inventory Management Analysis

8.      Manpower Analysis

9.      Impact of IFRS on the Cost Structure, Cash-Flows and Profitability

10.  Application of Management Accounting Tools

Forms Related to Compliance Report:

1.      Filing of Compliance Report : FORM-A

2.      Form of Compliance Report : FORM-B

Annexure to the Compliance Report:

1.      General

2.      Quantitative Information

3.      Reconciliation Statement (Profit)

*Appointment of Cost Accountant as a Cost Auditor:

a)      Cost Auditor shall be appointed within 90 days of the commencement of every financial year.

b)     Approval of the appointment shall be informed within 30 days of receipt of letter of appointment to the   Central Government by Cost Auditor.

*Cost Audit Report: Every Cost Auditor shall forward his report to the Central Government and to the concerned company within 180 days from the close of the Company’s financial year to which the report relates.

*Performance Appraisal Report: Every Cost Auditor, who submits cost audit report shall also furnish Performance Appraisal Report, duly authenticated by the Cost Auditor, to the Board/Audit Committee of the company in the prescribed form.

*Compliance Report: Every company to which The Companies (Cost Accounting Records) Rules, 2011 apply shall submit the compliance report  to the Central Government within 180 days from the close of the company’s financial year to which the compliance report relates.