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TMI BlogThe Cost Audit ReportX X X X Extracts X X X X X X X X Extracts X X X X ..... e (d) of sub-section (1) of section 209 of the Companies Act, 1956, have/have not been kept by the company; (iii) proper returns adequate for the purpose of my/our Cost Audit have/have not been received from the branches not visited by me/us; (iv) the said books and records give/do not give the information required by the Companies Act, 1956 in the manner so required; (v) the cost statements in respect of product or activity under reference as specified in the Annexures/Proforma of Schedule I, Schedule II or Schedule III of the concerned Cost Accounting Records (** .........) Rules duly audited by me/us are kept in the company. 2. In my/our opinion, the company's cost accounting records have/have not been properly kept so as to give a true and fair view of the cost of production, cost of sales and margin of the product under reference as prescribed under the rules. 3. Based on my/our examination of the records of the company subject to the aforesaid qualifications, if any, I/We give my/our observations and suggestions on the following-- (a) the adequacy or otherwise of the cost accounting system including inventory valuation in vogue in the company and suggestions for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ount, the Cost Auditor desires to point out any material deficiency or give a qualified report, he shall indicate the same against the relevant paras (i) to (vi) only in the prescribed form of the Cost Audit Report giving details of discrepancies he has come across. (4) The report, suggestions, observations and conclusions given by the Cost Auditor under this paragraph shall be based on verified data, reference to which shall be made here and shall, wherever practicable, be included after the company has been afforded an opportunity to comment on them. Annexure to the Cost Audit Report [See rule 2(c) and rule 4] 1. General (1) (a) Name and address of the registered office of the company whose accounts are audited. (b) Name and address of the place where the cost accounting records are maintained viz. registered office, head office or factory. (2) Name of the product and location of the unit to which the Annexure pertains. (3) The Company's financial year to which the Cost Audit Report relates. (4) Date of first commencement of commercial production of the product under reference. (5) Location of other sites manufacturing or producing or processing or mining the product or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct under reference and also its adequacy or otherwise to determine correctly the cost of production, cost of sales, sales realisation and margin of the product under reference. (2) Briefly specify the changes, if any, made in the costing system; basis of inventory valuation; method of overhead allocation; apportionment to cost centres/ departments and final absorption to the product under reference, etc., during the current financial year as compared to the previous financial year. 3. Process of manufacture A brief note regarding the process of manufacture along with flow chart covering production, utility and service department of the product. 4. Quantitative details Particulars Current Year 1st Previous Year 2nd Previous Year 1. Installed capacity* 2. Capacity enhanced during the year by leasing arrangement, etc. 3. Total available capacity 4. Production during the year: (a) self-manufactured (b) third party on job work, etc. (c) loan license basis 5. Total production quantity 6. Production as per Excise Records 7. Capacity utilisation percentage 8. Opening stock (finished quantity) 9. Total available quantity 10. Quantity captively consumed 11. Quantity s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nit Standard Actuals Current Year 1st Previous Year 2nd Previous Year 1. (specify) 2. 3. Note.--Details should be furnished in respect of each major type/variety/size, etc. of product under reference. 8. Salaries and wages Particulars Current Year 1st Previous Year 2nd Previous Year A. Quantitative Details: 1. Direct Workers: (a) Average number during the year (b) Man-days available (c) Man-days actually worked for: (i) own production (ii) job work (d) Reason-wise analysis of idle man-days [(a) - (b)] (i) absenteeism (ii) shortage of raw materials (iii) power shortage/failures (iv) Others (specify) 2. Indirect Workers: (a) Average number during the year (b) Man-days available (c) Mandays actually worked for: (i) own production (ii) job work (d) Reason-wise analysis of idle man-days [(a) - (b)] (i) absenteeism (ii) shortage of raw materials (iii) power shortage/failures (iv) others (specify) B. Cost Detail 1. Direct labour cost on production 2. Indirect employee costs on production 3. Employee costs on administration 4. Employee costs on selling and distribution 5. Other employees costs, if any (specify) 6. Total employee costs 7a. P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty on production/Sales 2. Lump sum payment of royalty, if any 3. Technical know-how charges 4. Others, if any 5. Total amount 6. Amount capitalised/deferred during the year 7. Net amount (5 - 6) 8. Deferred amount of earlier years, if any 9. Amount provided in the financial accounts (7 + 8) 10. Amount absorbed in the cost records 11. Shortfall/Excess, if any 12. Amount paid to related parties Note.--The details should be furnished in respect of each agreement separately. 15. Quality control expenses Particulars Current Year 1st Previous Year 2nd Previous Year 1. ISO number, if any 2. Name of certifying agency 3. Salaries and Wages 4. Other direct expenses 5. Others, if any (specify) 6. Total amount 16. Pollution control expenses Particulars Current Year 1st Previous Year 2nd Previous Year 1. Effluent treatment 2. Control of air pollution 3. Control of ash pound/ash mound 4. Penalty, if any 5. Others, if any 6. Total amount 17. Abnormal non-recurring costs Particulars Current Year 1st Previous Year 2nd Previous Year 1. (specify) 2. 3. Total 18.(A) Non-moving Stock (at the end of the year) Particulars Current Year 1st Previous Year 2nd ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... articulars Current year Two Previous Years Qty Rate Amount Qty Rate Amount 1. Purchased goods: (a) (specify) (b) (c) 2. Loan license basis: (a) (specify) (b) (c) 3. Own manufactured: (a) (specify) (b) (c) 4. Total sales Notes.--(1) Above details shall be furnished for major product groups/varieties. (2) Separate details shall be furnished for indigenous sales and export sales. 21. Margin per unit of output Particulars Current year* Two Previous Years Separately Cost of sales Sales realisation Margin (Rs.) Cost of sales Sales realisation Margin (Rs.) 1. Purchased goods: (a) (specify) (b) (c) 2. Loan license basis: (a) (specify) (b) (c) 3. Own manufactured: (a) (specify) (b) (c) Notes.--(1) Above details shall be furnished for major product groups/varieties. (2) Separate details shall be furnished for margin on indigenous sales and export sales. Where the product (such as sugar, bulk drugs, formulations, etc.) is sold at different prices in accordance with government policy, sales realisation and margin on such product at different prices shall be shown separately alongwith quantity and value. 22. Competitive margin against impo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al cost (b) Factory overheads (c) Royalty on production, if any (d) Salaries and wages (e) Research and development expenses (f) Quality control (g) Administrative overheads (h) Selling and distribution (i) Interest 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. Profit as %age of capital employed Profit as %age of net worth Profits as %age of net sales Profit as %age of value addition Value addition as a %age of Net Sales Current assets to current liabilities Net working capital in terms of number of months of cost of sales excl. depreciation Debt-equity ratio Raw materials stock in terms of number of months of consumption Stores and spares stock in terms of number of months of consumption Work-in-progress stock in terms of number of months of cost of production Finished goods stock in terms of number of months of cost of sales. Notes.--(1) Figures given for the company as a whole against serial numbers 1, 2, 3 and 4 shall be duly reconciled with the financial accounts of the company. (2) The figures given for the product against serial numbers 1, 2, 4 and 5 shall be duly reconciled with the cost accounts of the company. (3) Figures given for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) (c) PLA Total (a + b + c) Difference between (1 - 2) (State amount and reasons for difference) Excise Duty as per RT - 12 Difference between (2 - 5) (State amount and reasons for difference) Particulars Amount (Rs.) E. 1. 2. 3. 4. F. 1. 2. 3. 4. Reconciliation of Duty paid and recovered: Excise Duty paid as per P & L A/c Excise Duty Recovered as per P & L A/c Difference between duty paid and recovered (State amount and reasons for difference) Reconciliation of Turnover Turnover as per RT 12 Turnover as per Annual Accounts (Net off Duties & Taxes) Difference between (1 - 2) (State amount and reasons for difference) 28. Profit Reconciliation Particulars Current Year 1st Previous Year 2nd Previous Year 1. Profit or Loss as per cost accounting records 2. Add: Incomes not considered in cost accounts: (a) (specify) (b) (c) 3. Less: Expenses not considered in cost accounts: (a) (specify) (b) (c) 4. Add: Over-valuation of closing stock in financial accounts 5. Add: Under-valuation of opening stock in financial accounts 6. Less: Under-valuation of closing stock in financial accounts 7. Less: Over-valuation of opening sto ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the company has more than one factory producing the product under reference, separate details shall be indicated in the prescribed annexures in respect of each factory. (5) If the factory is engaged in the production of the product under reference and any other activities, separate details shall be indicated in the prescribed annexure for the factory as a whole and for the product under reference. (6) Figures shall be given for the year under audit and for the two preceding years in respect of paragraphs 4 to 26. Signature Signature Signature Name Name Name Cost Auditor Company Secretary Director Seal Stamp Stamp Date Date Date Proforma Name of the company: Name and address of the factory: Name of the product: Statement showing the cost of production, cost of sales, sales realisation and margin in respect of the product(s) under reference produced during the year/period: A. Quantitative Information Sr. No. Particulars (unit of measurement to be specified) Current Year Previous Year 1. 2. 3. 4. 5. 6. 7. (i) Installed capacity (ii) Capacity enhanced during the year by leasing arrangement, etc. Actual production/output (i) Self (ii) third parties, if any, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r statutory levies 32. Net sales realisation 33.Margin (32 - 30) 34. Add: Export benefits and incentives, if any 35. Total margin (including export benefits) 36. Ex-factory price (excluding sales tax, etc.) 37. Maximum retail price (excluding sales tax, etc.) 38. Maximum retail price, if any, prescribed by the Government/ statutory/regulatory body, etc. Notes.-- 1. Separate proforma shall be prepared for each type/variety/description of product(s) under reference. 2. Separate proforma shall be prepared for the quantity used for captive consumption, quantity, sold within the country and the quantity exported. Expenses incurred on export and the incentive earned thereon shall be indicated in the proforma applicable for the quantity produced and exported. 3. Separate proforma shall be prepared for any related party/inter-unit transfer of intermediate/finished product(s) under reference. 4. The administrative overheads shall be included in the cost of production only to the extent they contribute in putting the goods produced to their present location and condition. The balance of administrative overheads, if any, shall be included in the cost of goods sold. T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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