Cost Accounting Standards meet needs of managers

The Indian Accounting Standards , as notified under section 133 of the Companies Act 2013, have been formulated keeping the Indian economic & legal environment in view and with a view to converge with IFRS Standards, as issued by and copyright of which is held by the IFRS Foundation. Housing.com shall not be liable in any manner for any losses, injury or damage suffered by such person as a result of anyone applying the information in these articles or making any investment decision on the basis of such information , or otherwise. The users should exercise due caution and/or seek independent advice before they make any decision or take any action on the basis of such information or other contents. Borrowing costs are capitalised as part of the cost of the asset when it’s probable that they will result in future economic benefits to the company and the costs can be measured reliably.

9.1 .If the appointment of the auditor is being made for the first time after incorporation of the Company, the auditor should verify as to whether the Board of Directors have passed the resolution for his appointment within one month of the date of registration of the Company. 7.4 On receipt of the special notice of such a resolution, the company has to send a copy of the same to the retiring auditor forthwith. 7.3 The special notice should be given at least 14 days before the date of the General Meeting when the question of appointment or reappointment of the auditor is to be considered. 5.14 The company can remove the auditor before the expiry of his term of office by a resolution passed at any General Meeting and after obtaining previous approval of the Central Government. 5.11 If the company fails to appoint an auditor at the Annual General Meeting, such appointment will be made by the Central Government.

It is not possible to set out all the circumstances under which disclosure of information may be required by law. If under any legal compulsion and if it is not legally permissible to claim privilege under the Evidence Act, 1972 (S.126), the disclosure made by a member of such information may not be considered as misconduct. However, such matters involve niceties of law and expert legal advice may be sought prior to such disclosure.

Cost Accounting Standards – Download Here

When making the enquiry from the retiring auditor, the one proposed to be appointed or already appointed should primarily find out whether there is any professional or other reasons why he should not accept the appointment. The name, description and address of member may appear in any directory or list of members of a particular body in which the names are listed alphabetically. For a specialized directory or a publication such as a “Who’s Who” , a member should use his discretion in supplying information, bearing in mind the nature and purpose of the publications. In addition to his name, description and address and those of his firm, a member may give where appropriate, directorships held and reasonable personal details and may state his outside interests.

This Section deals with special provisions relating to appointment of auditors by certain companies and they have necessarily to be considered by the incoming auditor before he accepts his assignment. Sometimes, the retiring auditor fails without justifiable cause except a feeling of hurt because of the change, to respond to the communication of the incoming auditor. So that it may not create a deadlock, the auditor appointed can act, after waiting for a reasonable time for a reply. When advertising for staff, it is desirable that members should avoid the expression such as “a well-known firm”, since this would savoir of advertisement. The advertisements should not contain any promotional element nor should there be any suggestion that the services offered by the Cost Accountant or his firm are superior to those offered by other accountants.

Where the effect of such change is not ascertainable wholly or partly, the fact shall be indicated. Once the basis of collection, allocation, apportionment and absorption for different production cost centers are selected. Change in basis for collection, allocation, apportionment and absorption can be adopted only when it is compelled by the change in circumstances like change in technology, refinement and improvement in the basis etc and the change would provide more scientific approach.

When the auditor is appointed in place of an existing auditor who has resigned or has been removed or has ceased to hold office for any other reason. A Cost Accountant in practice holding training courses, seminars etc. for his staff may also invite the staff of other Cost Accountants and clients to attend the same. However, undue prominence https://1investing.in/ should not be given to the name of the Cost Accountant in any booklet or document issued in connection therewith. There should be no objection to the publication of photographs and brief particulars of members in magazines provided no payment is made for such publication and there is no advertisement of professional attainments.

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If the carrying amount is greater than the amount to be recovered by sale or use of the asset, it is considered an impaired loss/asset. This standard cover the treatment of events and contingencies that occur post the date of drawing up the balance sheet. Professional misconduct in relation to members of the Institute generally requiring action by a High Court. If he includes in any statement, return or form to be submitted to the Council any particulars knowing them to be false.

In this connection, the procedure discussed in paras 7.4 to 7.7 below will have to be followed before any resolution for removal of the first auditor is passed at the General Meeting. For the removal of the first auditor of a Company approval of the Central Government as mentioned in para 5.14 below is not necessary. The change normally occurs where there has been a change of venue of business and a local accountant is preferred or where the partner who has been dealing with the client’s affairs retires or dies; or where temperaments clash or the client has some good. In such cases, the retiring auditor should always accept the situation with good grace. Members may appear on television and films and agree to broad – cast in the Radio or give lectures at forums and may give their names and describe themselves as Cost Accountants.

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ICWAI’s initiative being innovative in nature, it is natural questions are raised about the utility of CASs being issued by ICWAI. Kapil Gupta,Chairman,Chandigarh Chapter of ICWAI and Dalip Sharma,Regional Director,PHD Chamber welcomed the dignitaries and participants and addressed the need of cost accounting standards to standardise the practices followed to ascertain cost of production. The redrafting the existing Cost Accounting Standards in the Indian context should be in light of international best practices, and to align them with the international cost accounting standards issued by the International Federation of Accountants . Cost accounting and cost audit is a new order in presentation of cost statements to the stakeholders.

• Here again reference to the professional firm of the member should not be given.
• The Board has issued 24 standards to bring about better understanding of various elements of cost and best practices to be used.
• 9.1 .If the appointment of the auditor is being made for the first time after incorporation of the Company, the auditor should verify as to whether the Board of Directors have passed the resolution for his appointment within one month of the date of registration of the Company.
• I5.13 If the casual vacancy is caused by the resignation of an auditor, such vacancy can only be filled by the company in any General Meeting.
• Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner.
• AS-24 of the ICAI establishes guidelines for reporting information on discontinuing operations, allowing readers of financial statements to predict an enterprise’s cash flows, earnings-generating potential, and financial position by distinguishing discontinuing and continuing operations information.

The company has to give intimation to the Central Government within seven days about the fact that no such appointment has been made. 5.10 Except in the circumstances mentioned in 5.8 and 5.9 above, a retiring auditor shall be re-appointed if he is otherwise qualified for such reappointment. 5.8 If the retiring auditor has given a notice in writing of his unwillingness to be reappointed, the Company can appoint any other auditor. 5.2 If the Board of Directors do not make such appointment, the company, can make the appointment of first auditor at any General Meeting. When one or more of the auditors appointed by the Company was/were not holding this office earlier.

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The Standard addresses the recognition of revenue from the sale of goods, the provision of services, and interest, royalties, and dividends. We might notice that the MCA gives companies the Accounting Standards based on what the ICAI says they should do. MCA notifies these Accounting Standards through the Companies Rules and any changes to them. They apply to companies, including Small and Medium-sized Companies, for which Indian Accounting Standards do not apply. Pursuant to implementation of IndAS, the Companies Rules, 2014 are to be amended to bring parity between financial records and cost records.

If the company is not willing to allow the incoming auditor to verify the relevant records in order to enable him to ascertain as to whether the provisions of the above sections have been complied with, the incoming auditor should not accept the audit assignment. 6.3 The provisions relating to appointment of first auditor, filling of casual vacancy, removal of auditor etc. which are contained in Section 224 will apply to the company specified in Section 224A. The notice of such a resolution will have to be dealt with as provided in Sections 225 and 225.

Then there’s the input cost, which includes things like labour and supplies. I am not sure which ones are more relevant to mention, from the above list. AS-29 of the ICAI ensures that proper recognition criteria and measurement bases are applied to provisions and contingent liabilities, and that sufficient information is published in the financial statements’ notes to help users understand their nature, timing, and amount. AS-19 of ICAI prescribes accounting standards and disclosures for financing and operating leases for lessees and lessors. AS-1 of ICAI deals with disclosing significant accounting policies applied in preparing and presenting financial statements in a supplementary statement/notes to permit meaningful comparison of financial statements of different enterprises/periods. The ICAI Accounting Standards for non-corporate entities have been around for 20 years, and they are now being reviewed, changed, and improved to meet the financial reporting requirements of Ind AS as much as possible for SMEs.

Consequent to above proposed Accounting Standards, Exposure Drafts of the Limited Revisions to the following Accounting Standards have been issued. To review, at regular intervals, the Accounting Standards from the point of view of acceptance or changed conditions, and, if necessary, revise the same. To formulate Accounting Standards cost accounting standards in india with a view to assisting the Council of the ICAI in evolving and establishing Accounting Standards in India. The Company shall, within 30 days from receipt of Cost Audit report, submit such report to the Central Government along with full information and explanation on every reservation or qualification contained, in form CRA-4.

ICAI will maintain consistency/synchronization in the numbering of AS with numbering of Ind AS, i.e. existing Accounting Standards shall be amended and renumbered suitably. AS-5 of ICAI should be applied when presenting profit or loss from ordinary activities, extraordinary items, and prior period items in the Statement of Profit and Loss, accounting for changes in accounting estimates, and disclosing accounting policy changes. These standards are mandatory on the dates specified either in the respective document or as notified by the ICAI/ MCA. The following is the COST ACCOUNTING STANDARD 7 (CAS – 7) issued by the Council of The Institute of Cost Accountants of India on EMPLOYEE COST. In this Standard, the standard portions have been set in bold italic type.

In case of such changes, proper disclosure in cost records is essential.. If such change has a material effect on the cost of the product should be disclosed in the cost statements. Where the effect of such change is not ascertainable wholly or partly, the fact should be indicated in the cost statement. The government some time uses cost information to determine the tax liability.