Cost auditor appointment

yes. You can. But subject to the ratification of share holders of the company.

Thank you Sir.

But will the ratification shall be required for each year during the term of appointment?

According to Rule 6(3) of Cost Audit Rules, Every Cost Auditor shall continue in such capacity of Cost auditor till expiry of 180 days from closure of Financial year or till he submit cost audit repoert for the financial year in which he is appointed.

Originally posted by : Jatin Bajaj
	According to Rule 6(3) of Cost Audit Rules, Every Cost Auditor shall continue in such capacity of Cost auditor till expiry of 180 days from closure of Financial year or till he submit cost audit repoert for the financial year in which he is appointed.

the sub rule states this:

Every cost auditor appointed as such shall continue in such capacity till the expiry
of one hundred and eighty days from the closure of the financial year or till he submits
the cost audit report, for the financial year for which he has been appointed.

This makes a difference. Thats the reason behind my doubt.

No where is it restricted

Statutory audit  is mandatory for all companies right from incorporation, irrespective of size and profitability .  Hence provision  has  been made for appointment of statutory auditor for longer duration.  However, cost audit  is not applicable in all companies and is dependent  upon a number of factors including government policy, net worth/turnover of the company for the year etc.  Hence the Act has  not made provision for appointment  of cost auditor for  more than one year.

according to the rule 6(1) and 6(3). cost auditor is appointed every year. appointment of cost auditor is based on turnover. if he was appointed for more than one year then it may be, his service would no be required  for next year if company has turnover less than specified limit. thats why legisilation did not mention the requirement for appointing cost auditor for more than one financial year