RECENT CHANGES IN COST ACCOUNTING RECORD RULES ~~AN INTRODUCTION~~

PTD BY:

BHUSHAN SHARMA & A S S O C I AT E S ,

COST ACCOUNTANTS

P H : 9 9 9 9 0 2 0 2 74

Cost Audit and Cost Accounting Records/Compliances

FOREWORD
Regulatory Framework Applicability criteria What Do We Offer Value Addition

About VBS

REGULATORY FRAMEWORK
The Companies (Cost Accounting Record) Rules 2011 and various orders issued by MCA, requires followings for specified companies : Maintenance of Cost Records in accordance with the generally accepted cost accounting principles Cost Audit by cost accountants having valid certificate of practice Cost compliance report duly certified by a Cost Accountant

APPLICABILITY CRITERIA
Submission of Compliance Report 1.1 Every company engaged in manufacturing, processing, mining, production activities (including Real Estate and construction companies) EXCEPT Bulk Drugs, Formulations, Fertilizers, Sugar, Industrial Alcohol, Electricity, Petroleum, Telecommunication Aggregate value of Net Worth > Rs 5 crores or Aggregate value of Turnover > Rs 20 crores or Equity/Debt securities are listed in stock exchange

Shall maintain Cost Records as per generally accepted cost accounting principles And submit a compliance report duly certified by cost accountant

APPLICABILITY CRITERIA
Audit of Cost Records 2.1

8 industries

Bulk Drugs
Formulation Fertilizer

Aggregate value of Net Worth > Rs 5 Crores or Aggregate value of Turnover > Rs 20 Crores or Equity/Debt securities are listed in stock exchange

Shall maintain Cost Records as per generally accepted cost accounting principles

And
get it audited by cost accountants having valid certificate of practice

Sugar
Industrial Alcohol Electricity Petroleum Telecommunication

APPLICABILITY CRITERIA
Audit of Cost Records 2.2 Shall maintain Cost Records as per generally accepted cost accounting principles

Cement

Steel Plant
Paper Glass

Aggregate value of Turnover > Rs 100 Crores

Aluminum
Paints & Varnishes Tyres & tubes Engineering Machinery Insecticides

And
or Equity/Debt securities are listed in stock exchange get it audited by cost accountants having valid certificate of practice

APPLICABILITY CRITERIA
Audit of Cost Records (Applicable on or after 1st April, 2012) 3.1
Jute
Cotton Silk Woolen or blend fibers/textiles

Edible oil seeds & oils (Incl. vanaspati)

Packing food Products(including packing ) Organic and inorganic chemicals Coal and lignite Mining and Metallurgy of ferrous & non-ferrous Metal Tractor and other motor Vehicles (including automotive components)

Aggregate value of Turnover > Rs 100 Crores

Shall maintain Cost Records as per generally accepted cost accounting principles

And
or Equity/Debt securities are listed in stock exchange get it audited by cost accountants having valid certificate of practice

Plantation Products
Engineering Machinery (Including electrical and electronic products)

WHAT DO WE OFFER
We offer following services relating to Cost records, compliances and audit, subject to consideration of Independence Issue: Maintenance of Cost Accounting Records u/s 209(1)(d) Compliance Report as required by the Companies (Cost Accounting Records) Rules, 2011 Cost Audit u/s 233B of Companies Act, 1956 Maintenance of cost centre wise records of Assets and Depreciation in the Fixed Assets Register (FAR) Design and Implementation of Cost Accounting System Certification on CAS 4 Captive Consumption

Areas of specialization

Accounting & Audit

Cost Audit Concurrent Audits

Business Advisory & Assurance

Internal Audit Risk Assessment SOP Development

Corporate Consulting
Project Finance Corporate Law

Investigations
Due Diligence Stock audits Cost Accounting record

Operations Audit
IS Audit Management Audit Valuations

Taxation
Compliance KVAT Audit Representation Services Advisory- including on Service Tax and VAT

compliance reporting.

STP & EHTP Issues

Service Tax Issues Central Excise and customs

OUR SERVICES WRT COST AUDIT

Installation of system of Cost Recording where needed Conducting Audit and issuance of Certificate. As a separate activity
Review your costing system Provide necessary suggestion in collection and reporting. Bringing costing records in line with GACAP and CAS. Providing any services from time to time. Certifications for captive consumption under CAS4. Authentication of costing records. Issuance of Cost Audit Report to Audit committee and to the Govt. of India

VALUE ADDITION
Maintenance of cost records adds value to the Business in following ways: Most scientific way to compute the cost of product, Quality Control and Testing costs including a fair allocation of overheads. It helps in pricing, profitability and tax planning.

It helps in cost control by applying of various tools.

It helps in preparing long term business planning, business modelling and evaluating new investment and business proposals.

With new trends in the industry, cost records strengthen the documentation for claiming cost escalations.

Benefits of the exercise some practical examples

Improved efficiency and response time

Substantial reduction in time taken in various report generation eg. Product vise cost and profitability Alternative utilization of various resources to the more profitable products. Timely action and response on various activities Helps very much in pricing. Helps in measuring inter unit performance measure.
Allocation of resources based on the profitability would result in not only increase in revenue but also profit. Adequate segregation of cost viz fixed and variable will enable to management to control cost effectively. Savings in operating costs with effective process of planning and monitoring (trend analysis and budget monitoring)

Revenue Maximization

Cost Control

ABOUT BSA
BSA is a specialized corporate advisory firm promoted by young and dynamic professionals having rich experience in the field of financial Planning, Cost management and corporate consultancy. Our team consists of professionals who possess the acumen and wide experience in the areas of Designing of Costing system, Tax advisory, Budgetary Control ,Corporate Laws and financial services, Cost Accounting and Auditing, Management Audits, Pricing Valuation and System Development & Implementation etc.

CORE TEAM MEMBERS

CMA Bhushan Sharma - B.Com(H), ACMA,CFA,CIMA Bhushan Sharma, a Associate member of the Institute of Cost Accountants of India with 20th Rank all Over India and a commerce graduate from Delhi University, holding a CFA Charter From ICFAI and CIMA(London) has over 8 years of valuable experience in the profession as well industry. Worked With Daimler Chrysler (Car Manufacturing) in USA,FIAT in Canada as Budget & Cost consultant. Designed Costing system & internal control mechanism for continental Tyres & Automotive components. Last assignment held as Group Management Accountant of Veetee Rice Ltd. CMA Suresh Sherawat- B.Com (Hons),ACMA, ACA, Suresh Sherawat is an associate member of the ICAI and has rich experience in advising corporate on the suitable corporate structures for global business operations and corporate consultancy. He Worked with so many corporate concern.

CORE TEAM MEMBERS

CMA Shashi Kant Gupta- M.Com, MBA(F), FCMA, Shashi Kant Gupta is a fellow member of the Institute of Cost Accountants of India, having over 20 years of work experience (which includes various organization of Central Government, Public Sector Undertakings, Private sector) with a proven track record of performance in the field of Costing accounting, compliances and auditing. He has rich experience in Edible & Non edible Oils, Pharmaceuticals, Paper, Packing, Food Packaging, Steel, Power and Textiles Sector. CMA Vipul Bhardwaj - B.Com, ACMA Vipul Bhardwaj, an associate member of the Institute of Cost Accountants of India and has been trained with pioneer Cost Accountants and Consulting firms. His tenure with a leading cost accountant firm has also given him wide experience in handling cost audits of multinational clients. He has extensive experience in the area of Costing, MIS, Budgeting, cost audits, development of costing system and Maintenances of cost Records.

CORE TEAM MEMBERS

CMA Abhishek Bhatnager - B.Com, ACMA,ACA, Abhishek Bhatnagder is an associate member of ICAI and has good experience in the domain of corporate and financial advisory. His tenure with American Express, Hi-Tech, Endurance Auto has also given him wide experience to understand business processes and financial reporting framework for the Multi National Companies. CA Kalpna Sharma - B.Com, ACA, ACS Kalpna Sharma is a commerce graduate from Delhi university and is a Chartered Accountant. She has rich experience in the field of Accounting consultancy, Costing & Taxation related matters.

OUR VALUED CLIENTS

We at BS & associates serves Many Automobiles companies , FMCG, Engineering ,Pharma ,Some of following clients listed below having turnover more then 500 Cr :

Continental Automotive Woodward Power Tools

Yamaha Motors
Hi-Tech Gears Vatika DAAWAT Foods Ltd.

Veetee Fine Foods Ltd

Arise India Park Pharma Gas Authority of India Ltd.- (Exploration Division) Amar Ujala Publications Limited BSNL ( Ambala Circle) Denso India Ltd.- (Cost Records Maintenance (Partnership)

CONTACT US
Contact Persons

BSA
Delhi BG-3/37, Paschim Vihar New Delhi 110063 Tel: +91 9999020274 www.bsaindia.org contact@bsaindia.org CMA Bhushan Sharma M +91 9999020274 bhushan@bsaindia.org cma.bhushansharma@gmail.com

CA Kalpna Sharma M +91 8860220633 kalpna@bsaindia.org cakalpnavashisth@gmail.com