COST AUDIT RULES AMENDED
- Definition of Cost Audit Report
"cost audit report" means the duly signed cost auditor's report on the cost records
examined and cost statements which are prepared as per these rules, including attachment,
annexure, qualifications or observations attached with or included in such report.
"Alight: this definition gives more clarity on what is to be reported"
- Generation of electricity for captive consumption
* Under Application of Cost Records (Rule 3) in the table of regulated sectors / industry in the Electricity Sector the words "other than for captive generation" is omitted
(Please note that in fact the entire table was substituted, however there are only few changes in that and hence for the sake of easy understanding such changes are referred to as either omitted / amended / substituted)
* Requirement for cost audit shall not apply to a company which is engaged in generation of electricity for captive consumption through Captive
Generating Plant.
For this purpose, the term "Captive Generating Plant" shall have the same
meaning as assigned in rule 3 of the Electricity Rules, 2005
"Alight: the intention to do away with maintaining records as well as
conducting cost audit for those companies which generate electricity for
self consumption has been made clear"
- Consent letter along with certificate from Cost Auditor
Consent letter shall be obtained from the cost auditor before appointment along with the certificate stating the required information.
"Alight: provision is on par with that of appointment of statutory auditors"
- Removal of Cost Auditor
Cost Auditor can be removed before the expiry of the term only through Board Resolution and such removal shall be intimated to RoC by filing Form CRA-2 attaching the Board Resolution. However this has nothing to do with the voluntary resignation of the Cost Auditor concerned.
"Alight: provided clarity on the process for removal of Cost Auditor"
- Board to approve cost and other statements to be annexed to Cost Audit report
"The cost statements, including other statements to be annexed to the cost audit
report, shall be approved by the Board of Directors before they are signed on behalf of the
Board by any of the director authorised by the Board, for submission to the cost auditor to
report thereon"
"Alight: in line with the industrial practise"
- Form CRA-4 to be filed in XBRL
Form CRA-4 is now supposed to be filed in XBRL format only.
"Alight: last year companies scanned chunks of data in the mca portal which is
cumbersome to the companies as well as to the ministry.
This is a better solution for that. Few may disagree with this"
- Minor changes in table 3(B) (Applicability of cost records for non-regulated sectors
* Both Iron and Steel industries have been included (previously only steel industry was mentioned)
* Other machinery and Mechanical Appliances included (previously only other machinery mentioned)
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