Whether cost audit applicable?

Hello Sir,

Please find attached file...hope it may help you...!!

[PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY PART-II, SECTION-3, SUB-SECTION (i)] MINISTRY OF CORPORATE AFFAIRS Notification New Delhi, dated the 3^RD  June, 2011

1. Short Title and Commencement- (1) These rules may be called The Companies (Cost Accounting Records) Rules, 2011.
2. (2) They shall come into force on the date of their publication in the Official Gazette.

 “Manufacturing Activity” includes any act, process or method employed in relation to - (i) transformation of raw materials, components, sub-assemblies, or parts into semi-finished or finished products; or (ii) making, altering, repairing, fabricating, generating, composing, ornamenting, furnishing, finishing, packing, re-packing, oiling, washing, cleaning, breaking-up, demolishing, or otherwise treating or adapting any product with a view to its use, sale, transport, delivery or disposal; or (iii) constructing, reconstructing, reconditioning, servicing, refitting, repairing, finishing or breaking up of any products.

 “Mining Activity” includes any act, process or method employed in relation to the extraction of ores, minerals, oils, gases or other geological materials from the earth’s crust, including sea bed or river bed.

 “Processing Activity” includes any act, process, procedure, function, operation, technique, treatment or method employed in relation to

1. altering the condition or properties of inputs for their use, consumption, sale, transport, delivery or disposal; or
2. accessioning, arranging, describing, or storing products; or –
3.  developing, fixing, and washing exposed photographic or cinematographic film or paper to produce either a negative image or a positive image; or (
4.  printing, publishing, finishing, perforation, trimming, cutting, or packaging; or
5. pumping oil, gas, water, sewage or any other product; or
6. transforming or transmitting, distributing power or electricity; or
7. harboring, berthing, docking, elevating, lading, stripping, stuffing, towing, handling, or warehousing products; or
8. preserving or storing any product in cold storage; or
9. constructing, reconstructing, reconditioning, repairing, servicing, refitting, finishing or demolishing of buildings or structures; or
10. farming, feeding, rearing, treating, nursing, caring, and stocking of living organisms; or
11. telecasting, broadcasting, telecommunicating voice, text, picture, information, data or knowledge through any mode or medium; or
12. obtaining, compiling, recording, maintaining, transmitting, holding or using the information or data or knowledge; or
13. executing instructions in memory to perform some transformation and/or computation on the data in the computer's memory.

Application- (1) These rules shall apply to every company, including a foreign company as defined under section 591 of the Act, which is engaged in the production, processing, manufacturing, or mining activities and wherein,

the aggregate value of net worth as on the last date of the immediately preceding financial year exceeds five crores of rupees; or

wherein the aggregate value of the turnover made by the company from sale or supply of all products or activities during the immediately preceding financial year exceeds twenty crores of rupees; or

wherein the company’s equity or debt securities are listed or are in the process of listing on any stock exchange, whether in India or outside India.

Provided that these rules shall not apply to a company which is a body corporate governed by any special Act;

Provided further that these rules shall not apply to the activities or products covered in any of the following rules,-

(a) Cost Accounting Records (Bulk Drugs) Rules, 1974

 (b) Cost Accounting Records (Formulations) Rules, 1988

(c) Cost Accounting Records (Fertilizers) Rules, 1993

(d) Cost Accounting Records (Sugar) Rules, 1997

(e) Cost Accounting Records (Industrial Alcohol) Rules, 1997

(f) Cost Accounting Records (Electricity Industry) Rules, 2001

(g) Cost Accounting Records (Petroleum Industry) Rules, 2002 (h) Cost Accounting Records (Telecommunications) Rules, 2002

Maintenance of records- (1) Every company to which these rules apply, including all units and branches thereof shall, in respect of each of its financial year commencing on or after the 1st day of April, 2011, keep cost records.

Form of the Compliance Report - Every company to which these rules apply shall submit a compliance report, in respect of each of its financial year commencing on or after the 1st day of April, 2011, duly certified by a cost accountant, along with the Annexure to the Central Government, in the prescribed form.

6. Time limit for submission of Compliance Report – Every company shall submit the compliance report referred to in rule 5 to the Central Government within one hundred and eighty days from the close of the company’s financial year to which the compliance report relates.

thanks

u mean if the co. satisfy any one of the three conditions then automatically it comes within the perview of cost audit irrespective of nature of industry (not to consider 7 specifeid industry as mentioned above as per revised guidelines because there is specifically provided in the respective rules)

Yes as to the best of my knowledge...!!!