Cost Auditor Appointment

[CS Nagpur]

Dear All,

Please Help me to resolve this Query.

If a Cost auditor appointment  is applicable to the company from past 5 or more years and in Current year T/O is Less than 50 cr then As per Provision this year cost auditor appointment is applicable but Next years Cost auditor Appointment is also applicable or not ??   

[CS Nagpur]

Anyone please reply

[CS Nagpur]

its would be helpful if anyone can share their experience regarding this 

[satish gupta]

Dear Sir/Madam,

Once cost audit applicable it will be applicable till the company exists even TO got zero.

Reference: FAQs-1 dated 19/03/2015

1.10 A company meets the threshold limits for both maintenance of cost records and cost audit in Year-0 (previous year) and consequently comes under the purview of the Rules in Year-1 (current year). If the turnover of company gets reduced to lower than the prescribed threshold limit in Year-1 (current year), whether Cost Records and Cost Audit will be applicable for Year-2 (next year).

Rule 3 of the Companies (Cost Records and Audit) Rules, 2014 states that a company engaged in the production of the goods or providing of services as prescribed having an overall turnover from all its products and services of rupees thirty five crore or more during the immediately preceding financial year, shall include cost records for such products or services in their books of account. Since the threshold limit for applicability of maintenance of cost accounting records is met in Year-0, the cost records are required to be maintained from Year-1. Once the maintenance of cost records becomes applicable, it would be maintained on a continuous basis in the subsequent years also. In the same line, cost audit will be applicable from Year-1 and for every year thereafter.   

Hope you got your answer.

Thanks & Regards

Satish Kumar Gupta (CMA, CS, LLB, M.Com)

Cost Accountant

[CS Nagpur]

Thank You So much Satish Sir

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