Archive | Cost Audit

Cost Audit: Meaning and Objectives | Auditing

In this article we will discuss about:- 1. Meaning of Cost Audit 2. Objectives of Cost Audit 3. Important Legal Provisions as to Cost Audit 4. Cost Audit Report Rules, 1996 5. Cost Accounting Records. Meaning of Cost Audit: The terminology issued by the CIMA defines Cost Audit as “the verification of the correctness of […]

Cost Audit Aspects: 2 Main Aspects of Cost Audit

This article throws light upon the two main aspects of cost audit. The aspects are: 1. From the Aspect of Statute 2. From the Aspect of Spheres for Action. Cost Audit: Aspect # 1. From the Aspect of Statute: In the case of a limited company, the scope of cost audit is outlined in the […]

Difference between Cost Audit and Financial Audit

This article will help you to differentiate between Cost Audit and Financial Audit. Difference # Cost Audit: A. Scope: 1. The entire emphasis is on micro-aspects, the aggregates being considered for checks. 2. It is an examination of day-to-day opera­tion, in so far as the cost records are de­signed in accordance with the cost ac­counting […]

Top 2 Objects of Cost Audit

This article throws light upon the top two objects of cost audit. The objects are: 1. General Objects 2. Social Objects. Cost Audit: Object # 1. General Objects: The general objects of cost audit are: 1. To detect the errors of principle of cost accountancy, and frauds that are usually made in the cost records, […]

Functional Responsibility of a Cost Auditor

After reading this article you will learn about the Functional Responsibility of a Cost Auditor. The expression that an auditor is a watch-dog and not a bloodhound was made in the course of judgment in a leading case- The Kingston Cotton Mills Company Ltd. A misfeasance action was taken by the liquidator against the auditor […]

Cost Audit: Unique Feature and Concept

After reading this article you will learn about Cost Audit:- 1. Unique Feature of Cost Audit 2. Concept of Cost Audit. Unique Feature of Cost Audit: The audit of cost accounts has attained its present status in the statute book of our country through a gradual process of industrial development and socio-economic expectations. During World […]

Check Points to be Considered before doing Cost Audit

This article throws light upon the top seven check points to be considered before doing cost audit. Some of the check points are: 1. Reconciliation of Cost and Financial Accounts 2. Pollution Control/Effluent Treatment 3. Utilities 4. Utilities other than the above (e.g., Refrigeration, Humidification, Air-Conditioning Compressed Air, Nitrogen, Brine, Oxygen, etc.) and a few […]

Inter-Company Transactions and Statutory Cost Audit

After reading this article we will learn about Inter-Company Transactions and Statutory Cost Audit. The expression denotes transactions taking place between two or more companies, whether they are related to each other or not, for a variety of considerations of personal and impersonal nature. These transactions between the companies are a normal feature of trade, […]

Contents of a Cost Audit Report

This article throws light upon the six main classifications of contents in the cost audit report. The classifications are: 1. Statutory Affirmations 2. Objective Statement of Findings 3. Statement of Facts 4. Re-Statement of Figures and Data 5. Statement of Opinion or Facts on Matters requiring Professional Competence 6. Statement of Opinion or Facts on […]

Professional Misconduct and Professional Negligence

This article will help you to differentiate between professional misconduct and professional negligence. Difference # Professional Misconduct: The Cost and Works Accountants’ Act, 1959, under Section 22, defines the expression: ‘Professional Misconduct’ as follows: ‘Professional misconduct’ shall be deemed to include any act or omission specified in any of the schedules but nothing in this […]

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