10/8/2015

CosCostRecordsAuditAmendmentRules2014ChangesSummary

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MCA NotificationCompanies Cost Records and Audit Amendment Rules 2014 dated 31122014.
SummaryofChangesmadeandNewFormsCRA1CRA3
MinistryofCorporateAffairs(MCA)hasbynotificationFNo.1/40/2013CLVdated31122014amendedtheCompanies(CostRecordsandAudit)Rule,2014.The
majorchangesbroughtaboutintherules,formsetc.areasunder:

Rules/Forms

SummaryofAmendmentsMade

Rule3 Application of Cost

Records

Earlier, Companies were required to maintain cost audit records u/s 148(1) categorywise on
thebasisofnetworthand/orturnoverbasis.Nowonlytwocategories(regulatedsectorsand
nonregulated sectors) have been retained and a general threshold of turnover of Rs. 35
crores or more has been prescribed for companies covered. M icro enterprise or a small
enterpriseasperMSMEDAct,2006havebeentakenoutofthepurview.

Rule4ApplicabilityforCost
Audit

EvenforregulatedsectorslikeTelecommunication,Electricity,PetroleumandGas,Drugsand
Pharma, Fertilizers and Sugar, Cost audit requirement has been made subject to a turnover
basedthresholdofRs.50croresforallproductandservicesandRs.25croresforindividual
product or services. For Nonregulated sector the threshold is Rs. 100 crores and 35 crores
respectively.

Rule5MaintenanceofCost
Records

The requirement to maintain cost records in Form CRA1 have been postponed to Financial
Year201516forthefollowingcompaniesinsomenonregulatedsectors,namelyCoffeeand
Tea,MilkPowderandElectricalsandelectronicmachinery.

Rule6CostAudit

Any casual vacancy in the office of a cost auditor, whether due to resignation, death or
removal to be filled by the Board of Directors within thirty days of occurrence of such
vacancy and the company shall inform the Central Government in Form CRA2 within thirty
daysofsuchappointmentofcostauditor.

CRA1Forms in which cost

recordsshallbemaintained

NewFormhasbeensubstituted.

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The form CRA1 prescribes the form in which cost records shall be maintained. The revised
formcategorisestherequirementofmaintainingproperdetailsasper30headingsasagainst
27 headings in previous form. The new headings are as follows: (1) Material Cost, (2)
Employee Cost, (3) Utilities, (4) Direct Expenses, (5) Repair and Maintenance, (6) Fixed
Assets and Depreciation, (7) Overheads, (8) Administrative Overheads, (9) Transportation
Cost,(10)RoyaltyandTechnicalKnowhow,(11)ResearchandDevelopmentexpenses,(12)
Quality Control Expenses, (13) Pollution Control Expenses, (14) Service Department
Expenses, (15) Packing Expenses, (16) Interest and Financing Charges, (17) Any other item
of Cost, (18) Capacity Determination, (19) Workinprogress and finished stock, (20) Captive
Consumption, (21) ByProducts and Joint Products, (22) Adjustment of Cost Variances, (23)
Reconciliation of Cost and Financial Accounts, (24) Related Party Transactions, (25)
Expenses or Incentives on Exports, (26) Production records, (27) Sales records, (28) Cost
Statements,(29)StatisticalRecords,(30)RecordsofPhysicalVerification

CRA3 Form of Cost Audit

Report

Clause(vii)havebeenaddedtoauditorsreportasunder:

Annexure to Cost Audit

Report

Annexurehasbeenreclassifiedintofourpartsasunder:
PartA
GeneralInformation,
GeneralDetailsofCostAuditors
CostAccountingPolicy
Product/ServiceDetailsforthecompanyasawhole
PartBForManufacturingSector
QuantitativeInformation
AbridgedCostStatement
DetailsofMaterialsConsumed
DetailsofUtilitiesConsumed
DetailsofIndustrySpecificOperatingExpenses
PartCForServiceSector
QuantitativeInformation
AbridgedCostStatement
DetailsofMaterialsConsumed
DetailsofUtilitiesConsumed
DetailsofIndustrySpecificOperatingExpenses
PartD
ProductandServiceProfitabilityStatement
ProfitReconciliation
ValueAdditionandDistributionofEarnings
FinancialPositionandRatioAnalysis
RelatedPartyTransactions
ReconciliationofIndirecttaxes

Detailedunitwiseandproduct/servicewisecoststatementsandschedulestheretoInrespect
of the product/services under reference of the company duly audited and certified by me/us
are/arenotkeptinthecompany

DownloadNotificationofCompanies(CostRecordsandAudit)AmendmentRules2014ClickHere>>
DownloadrevisedCostAuditReportFormCRA3ClickHere>>

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10/8/2015

CosCostRecordsAuditAmendmentRules2014ChangesSummary

http://abcaus.in/companiesact2013/costrecordsauditamendmentrules2014/summaryofchangesnewforms.html

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