Cost Audit

The working group on the Companies Act has recommended that the provisions under Section 233-B concerning the mandatory cost audit at the directives of the department of company affairs should be removed.

However, the requirement to maintain cost records should continue as before. The recommendation is a retrograde step, especially at a time when competition with MNCs has become necessary. One must therefore strive to produce at the minimum possible cost. Cost audit will help in achieving earning maximum profit.

Financial accounts should be maintained as per the requirements of Schedule VI of the Companies Act 1956. Afterwards, the annual accounts may be adopted by the shareholders in the annual general meeting without statutory audit. Hence, it is suggested that the provision regarding statutory audit should also be removed.