Appendix-5
148. (1)
Notwithstanding anything contained in this Chapter, the Central Government may,
by order, in respect of such class of companies engaged in the production of
such goods or providing such services as may be prescribed, direct that
particulars relating to the utilisation of material or labour or to other items
of cost as may be prescribed shall also be included in the books of account
kept by that class of companies:
Provided
that the Central Government shall, before issuing such order in respect of any
class of companies regulated under a special Act, consult the regulatory body
constituted or established under such special Act.
(2)
If the Central Government is of the opinion, that it is necessary to
do so, it may, by order, direct that the audit of cost records of class of
companies, which are covered under sub-section (1) and which have a net worth
of such amount as may be prescribed or a turnover of such amount as may be
prescribed, shall be conducted in the manner specified in the order.
(3)
The audit under sub-section (2) shall be conducted by a Cost
Accountant in practice who shall be appointed by the Board on such remuneration
as may be determined by the members in such manner as may be prescribed:
Provided
that no person appointed under section 139 as an auditor of the company shall
be appointed for conducting the audit of cost records:
Provided
further that the auditor conducting the cost audit shall comply with the cost
auditing standards.
Explanation.—For the purposes of this sub-section, the expression “cost auditing
standards” mean such standards as are issued by the Institute of Cost and
Works Accountants of India, constituted under the Cost and Works Accountants
Act, 1959, with the approval of the Central Government.
(4)
An audit conducted under this section shall be in addition to the
audit conducted under section 143.
(5)
The qualifications, disqualifications, rights, duties and obligations
applicable to auditors under this Chapter shall, so far as may be applicable,
apply to a cost auditor appointed under this section and it shall be the duty
of the company to give all assistance and facilities to the cost auditor
appointed under this section for auditing the cost records of the company:
Provided that the report on the audit of cost
records shall be submitted by the cost accountant in practice to the Board of
Directors of the company.
(6)
A company shall within thirty days from the date of receipt of a copy
of the cost audit report prepared in pursuance of a direction under sub-section
(2) furnish the Central Government with such report along with full information
and explanation on every reservation or qualification contained therein.
(7)
If, after considering the cost audit report referred to under this
section and the information and explanation furnished by the company under
sub-section (6), the Central Government is of the opinion that any further
information or explanation is necessary, it may call for such further
information and explanation and the company shall furnish the same within such
time as may be specified by that Government.
(8) If any default is made in complying with
the provisions of this section,—
(a)
the company and every officer of the company who is in default shall
be punishable in the manner as provided in sub-section (1) of section 147;
(b)
the cost auditor of the company who is in default shall be punishable
in the manner as provided in sub-sections (2) to (4) of section 147.
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