The Institute of Cost Accountants of India the COMPANIES ACT 2013

The Institute of Cost Accountants of India THE COMPANIES ACT 2013 (Act 18 of 2013) Suggestions with Justifications on Draft Companies (Cost Records and Cost Audit) Rules, 2013

S No. Draft Rules Suggestions of ICAI Justification 1 Short title and commencement (1) These Rules may be called the There should be separate Rules for  For maintenance of Cost Records and Cost Companies (Cost Records and Cost Maintenance of Cost Accounting Records and Audit, there are two separate sub-sections Audit) Rules, 2013. Cost Audit. under Section 148 viz 148(1) and 148(2) respectively  The Companies Act 1956 also had two sets of Rules, one under Section 209(1)(d) for Cost Accounting Records and the other under Section 233B for Cost Audit.  The separate sets of Rules will facilitate better administration and / or modifications. The Draft Rules have covered both the Cost Accounting Records and Cost Audit Report. It may please be noted that Section 148(1) states that the Central Government is required to “prescribe” particulars relating to the utilisation of material or labour or to other items of cost to be included in the books of accounts. Similarly, Section 148(2) requires Central Government to direct audit of cost records of such class of companies which shall maintain cost records and which have a specified amount of net worth or a specified amount of turn over.

1 S No. Draft Rules Suggestions of ICAI Justification Section 128 of the Companies Act contains provisions relating to maintenance of books of accounts by the companies (Chapter IX). Section 139 provides for appointment of auditor for audit of the financial statements and Section 143 stipulates the rights and duties of the auditor (Chapter X).

Thus, the intention of the legislation was clear that requirement of maintenance of cost records should be there for a larger base of companies to inculcate cost culture to make Indian industry sustainable and competitive in the global market, whereas Cost Audit could be prescribed for certain class of companies having a prescribed net worth or prescribed turnover within the class of companies that shall maintain cost records..

Cost information relating to utilization of material or labor or other items of cost is vital for companies in order to arrive at relevant and true cost of production and services.

The cost information system is also used for operationalizing strategies measuring productivity and performance, reducing wastages and improving profitability.

In view of different approaches to and objectives of Maintenance of Cost Accounting

2 S No. Draft Rules Suggestions of ICAI Justification Records and Cost Audit there should be separate Rules for: (1) Maintenance of Cost Accounting Records and (2) Cost Audit.

The draft Companies (Cost Accounting Records) Rules and Companies (Cost Audit Report) Rules 2013 are being sent to MCA separately. (2) They shall come into force on No Change is suggested the date of their publication in the Official Gazette. (3) They shall be applicable in No Change is suggested respect of financial years commencing on or after 1st April, 2014. 2 Definitions: It is proposed that the Rules shall include the Inclusion of the proposed additional definitions In these Rules, unless the context following definitions: in the Rules shall bring comprehensiveness and provides otherwise,- clarity as regards the application of the Rules. It will also avoid confusions and minimize legal disputes in future. 1. "Act" means the Companies No Change is suggested Act, 2013 (18 of 2013);

“Cost Accountant” not defined. “Cost Accountant” for the purpose of these Since a cost accountant in employment is also Rules means a cost accountant as defined in entitled to certify the maintenance of cost sub-section 28 of section 2 of the Companies records, although he cannot audit the same, Act 2013. the definition is expanded to include employed Explanation: A cost accountant includes a cost cost accountants also.

3 S No. Draft Rules Suggestions of ICAI Justification accountant in permanent employment of the company or a cost accountant in practice. 2. "Cost Accountant in practice" “Cost Accountant in practice” means a cost The clause “or a limited liability partnership means a cost accountant as accountant who holds a valid certificate of firm” should be added as Cost Accountants are defined in clause (b) of sub- practice under sub-section (1) of section 6 of authorized to practice as a limited liability firm. section (1) of section 2 of the Cost the Cost and Works Accountants Act, 1959 and and Works Accountants Act, 1959 who is in full time practice and includes a firm (23 of 1959) and who holds a valid of cost accountants; certificate of practice under sub- section (1) of section 6 of that Act and who is deemed to be in practice under sub-section (2) of section 2 of that Act, and includes a firm of cost accountants;

3. "Cost Auditor" means an “Cost Auditor” means a cost accountant in Expanded definition as defined under the Cost auditor appointed to conduct practice and includes a firm of cost accountants and Works Accountants Act, 1959 which audit of cost records under sub- or a limited liability partnership firm appointed includes partnership firms and Limited Liability section (3) of section 148 of the to conduct an audit of cost records, under sub- Partnerships also. Act; section (3) of section 148 of the Act. 4. “Cost Audit Report" means the “Cost Audit Report” means the Cost auditor’s This is to amplify that auditor’s observations report audited and signed by the report and includes his observations and and suggestions, and annexure to the audit cost auditor in accordance with suggestions, and Annexure to the cost audit report are the integral part of the audit report. the proviso to sub-section (5) of report duly audited and signed by Cost Auditor section 148 and Rule 5 of these in accordance with proviso to sub-section (5) of Rules; section 148 of the Act and these Rules ;

“Cost Record Certificate” not “Cost Record Certificate” means Cost Record Under the Section 92 of the Companies Act defined certificate duly authenticated and signed by a 2013, the annual return filed by a listed cost accountant in the prescribed form; company or by a company having such paid up

4 S No. Draft Rules Suggestions of ICAI Justification capital and turnover as may be prescribed, is required to be certified by a Company Secretary in Practice in prescribed form.

Under Section 134 of the Companies Act 2013, the financial statements including the consolidated financial statements, if any, as approved by the Board of Directors, is required to be signed by two directors, the CFO and the Company Secretary of the Company.

On the lines of the above, a Cost Record Certificate should be mandated to be signed by a Cost Accountant in Practice. “Cost Accounting Standards” not “Cost Accounting Standards” means the Cost Accounting Standards are being issued by defined. standards of cost accounting, issued by the the Institute to bring uniformity in the Institute; principles and practices for cost accounting across industries. The Rules need to mention that the record should be maintained in accordance with Cost Accounting Standards, to the extent possible. Therefore the definition of Cost Accounting Standards should be incorporated in the Rules.

5. "Cost Records" means books of “Cost Records” means books of accounts and No substantive change is suggested. account relating to utilisation of records relating to utilisation of materials, materials, labour and other items labour and other items of cost as applicable to of cost as applicable to the the production of goods or providing of services production of goods or provision under the provisions of sub section (1) of of services under the provisions of Section 148 of the Act; section 148 of the Act and these

5 S No. Draft Rules Suggestions of ICAI Justification Rules;

6. "Institute" means the Institute No Change is suggested of Cost Accountants of India constituted under the Cost and Works Accountants Act, 1959 (23 of 1959);

“Form-A” not defined “Form-A” means the form prescribed in these A definition will clarify the position. Rules for filing Cost Record Certificate and other documents with the Central Government in the electronic mode; “Form-B” not defined “Form-B” means the form of the Cost Record A definition will clarify the position. Certificate and includes Annexure to the Cost Record Certificate; “Form-I” not defined “Form-I” means the Form prescribed in these A definition will clarify the position. Rules for filing cost audit report and other documents with the Central Government in the electronic mode; “Form-II” not defined “Form-II” means the Form of the cost audit A definition will clarify the position. report and includes auditor's observations and suggestions, and Annexure to the cost audit report; “Form-III” not defined “Form-III” means the Form of the Performance A definition will clarify the position. Appraisal Report; “Generally Accepted Cost “Generally Accepted Cost Accounting The Institute of Cost Accountants of India has Accounting Principles” not defined Principles” means the generally accepted promulgated Generally Accepted Cost principles of cost accounting issued by the Accounting Principles for the areas in which Institute. Cost Accounting Standards are yet to be issued. Through this clause, it is proposed to recognize

6 S No. Draft Rules Suggestions of ICAI Justification those principles.

“Product” not defined “Product” means any tangible or intangible The relevant provisions in the Companies Act good, material, substance, article, idea, know- specify that “such class of companies engaged how, method, information, object, service, etc. in the production of such goods or providing that is the result of human, mechanical, such services” will be subject to the cost industrial, chemical, or natural act, process, records and cost audit mechanism. This procedure, function, operation, technique, or definition is seeking to specifically provide a treatment and is intended for use, legal definition for the coverage of production, consumption, sale, transport, store, delivery or products and services. disposal; “Production” not defined “Production” means bringing into existence The relevant provisions in the Companies Act new goods, a thing that result from any action, specify that “such class of companies engaged process or effort, a product of human activity in the production of such goods or providing or effort and includes manufacture. such services” will be subject to the cost Explanation: ‘Manufacture’ includes any records and cost audit mechanism. This process incidental or ancillary to the definition is seeking to specifically provide a completion of manufactured goods and legal definition for the coverage of production, includes deemed manufacture’ products and services. “Production of goods” not defined “Production of Goods” means production, The relevant provisions in the Companies Act making, manufacturing, processing, mining, specify that “such class of companies engaged growing or transformation of tangible or in the production of such goods or providing intangible and intermediates, , semi-finished or such services” will be subject to the cost finished products by using resources, raw records and cost audit mechanism. This materials, components, intermediates, semi- definition is seeking to specifically provide a finished goods, sub-assemblies, process, legal definition for the coverage of production, method, factors, ideas, information know-how products and services. or other inputs; “Product Group” not defined “Product Group” in relation to tangible Although product wise, and service wise products means a group of homogenous and records and unit cost statement are available

7 S No. Draft Rules Suggestions of ICAI Justification alike products, produced from same raw with the company and audited under provisions materials and by using similar or same of The Companies Act, the process has to be production process, having similar physical or evidenced by a summarized statement which is chemical characteristics and common unit of required for the purpose of e-filing with the measurement, and having same or similar authorities who are mandated to administer usage or application; and in relation to the cost records and cost audit mechanism. intangible products means a group of This is sought to be facilitated by this provision. homogenous and alike products or services, produced by using similar or same process or inputs, having similar characteristics and common unit of measurement, and having same or similar usage or application“ “Service” not defined "Service" means service as defined in the The relevant provisions in the Companies Act, Finance Act relevant to the accounting year. specify that “such class of companies engaged in the production of such goods or providing such services” will be subject to the cost records and cost audit mechanism. This definition is seeking to specifically provide a legal definition for the coverage of production, products and services. “Providing Service” not defined “Providing Services” means providing, The relevant provisions in the Companies Act, rendering or allowing use of tangible or specify that “such class of companies engaged intangible products or services of any nature, in the production of such goods or providing type, kind or variety and includes all types of such services” will be subject to the cost job work or processing operations; records and cost audit mechanism. This definition is seeking to specifically provide a legal definition for the coverage of production, products and services.

3 Application 3. Application- These Rules shall apply to such The objective of maintaining cost accounting (1) Applicability for Cost Records : class of companies, including a foreign records / cost audit is to ensure optimum

8 S No. Draft Rules Suggestions of ICAI Justification For the purpose of sub-section (1) company as defined under sub-section (42) of utilization of scarce resources and integrity of of section 148 of the Act, the section 2 and section 379 of the Act, engaged in data, that the government / regulatory following class of companies, the production of following goods or providing authorities might require from time to time to including Foreign Companies of following services which belongs to the formulate policies and to regulate tariff; and defined in sub-section (42) of following class of companies, excluding small also to improve cost management at the firm section 2 of the Act, shall be companies: level to improve the competitiveness of the required to include cost records in firm and the economy in the global market and their books of account:- to benefit customers in terms of reduced price. Mandating maintenance of cost records will upgrade the currently lower maturity level of cost management as per CII and other studies. Mandating medium size companies to maintain cost records will induce those companies to adopt cost management culture and enhance their competitiveness. Maintenance of Cost Records by the company engaged in production of goods or providing services is essential for identification and collection of costs and determination of true cost of production of goods or providing of services. This will ensure availability of quality product and services at affordable prices for the masses and protect consumers against unfair prices and trade practices. The data can also be made available to different Government agencies such as regulators, Competition Commission, SFIO, Revenue Authoritiies, when needed. In the absence of mandatory cost records it would be difficult to provide the requisite data at appropriate time.

9 S No. Draft Rules Suggestions of ICAI Justification 3 Companies engaged in the We observe that, in some of the clauses, the This will bring more clarity in the Rules. production of following goods or class of companies has been identified with the providing following services:- chapter heading of the Central Excise Tariff Act (CETA). This is the right approach for identification of the class of companies to be covered under the said Rules. However, in many of the clauses, the type of products mentioned in the beginning of the clause is not in conformity with the Excise Chapter Heading leading to confusion about inclusion of the products / industry covered under the specific Chapter. Further, to avoid any confusion, reference to Chapter heading of the CETA should cover the chapter in its entirety. (a) Companies engaged in (a) Companies engaged in Strategic Sectors Strategic Sectors (i) Machinery, mechanical No change is suggested. appliances used in defence, space and atomic energy sectors such as: (A) Nuclear reactors; fuel elements (cartridges), non- irradiated, for nuclear reactors; machinery and apparatus for isotopic separation (B) Steam or other vapour generating boilers (other than central heating hot water boilers capable also of producing low pressure steam); super-heated water boilers (C) aircraft, spacecraft and parts thereof (D) ships, boats and

10 S No. Draft Rules Suggestions of ICAI Justification floating structures; (ii) Turbo jets and turbo (ii) Turbo jets and turbo propellers are included Reference to Central Excise Tariff Act (CETA) propellers; under chapter 84 of the Central Excise Tariff Act avoids ambiguity. 1985; (iii) Arms and ammunition; (iii) Arms and ammunitions; parts and Reference to Central Excise Tariff Act (CETA) accessories thereof are included under Chapter avoids ambiguity. 93 of the Central Excise Tariff Act 1985; (iv) Propellant powders; prepared (iv) Explosives, pyrotechnic products and Reference to Central Excise Tariff Act (CETA) explosives, (other than propellant combustible preparations are included under avoids ambiguity. powders); safety fuses; detonating Chapter 36 of Central Excise Tariff Act 1985; fuses; percussion or detonating caps; igniters; electric detonators; (v) Radar apparatus, radio (v) Radar apparatus, radio navigational aid Reference to Central Excise Tariff Act (CETA) navigational aid apparatus and apparatus and radio remote control apparatus avoids ambiguity. radio remote control apparatus; are included under Chapter 85 of Central Excise Tariff Act 1985; (vi) Tanks and other armoured No change is suggested. fighting vehicles, motorised, whether or not fitted with weapons and parts of such vehicles, that are funded (investment made in the company) to the extent of 90% or more by the Government or Government Agencies; (b) Companies engaged in an (b) Companies engaged in an industry industry regulated by a Sectoral regulated by a Sectoral Regulator or a Ministry Regulator or a Ministry or or Department of Central Government. Department of Central Government.

11 S No. Draft Rules Suggestions of ICAI Justification (vii) Port services of (vii) Port services of stevedoring, pilotage, The description under this clause in the draft stevedoring, pilotage, hauling, hauling, mooring, re-mooring, hooking, Rules does not cover the port services at all mooring, re-mooring, hooking, measuring, loading and unloading services classes ports. The minor ports are getting measuring, loading and unloading rendered by and or at a Port in relation to a grants and concessions from the Government services rendered by a Port in vessel or goods regulated by the Government; of India or other agencies and therefore, it is relation to a vessel or goods appropriate to cover those. regulated by the Tariff Authority for Major Ports under Section 111 of the Major Port Trusts Act, 1963;

(viii) Aeronautical services of air (viii) Aeronautical services of air traffic Non-major airports, which are not covered by traffic management, aircraft management, aircraft operations, ground AERA Regulation, should also be covered under operations, ground safety safety services, ground handling, cargo facilities this provision as maintenance of cost records services, ground handling, cargo and supplying fuel etc. rendered by and or at will improve efficiency in maintenance and facilities and supplying fuel etc. airports and regulated by the Government; operations of airport and Government is also rendered by airports and contemplating to bring many other airports regulated by Airports Economic under AERA in the near future. Regulatory Authority (“AERA” aeronautical) under the Airports Economic Regulatory Authority of India Act, 2008;

(ix) Telecommunication (ix) Telecommunication activity includes activity In the present form as notified, the inclusion services made available to users of any description (including electronic mail, clause is not equitable and is also confusing. by means of any transmission or voice mail, data services, audio text service, Hence the revised clause as suggested should reception of signs, signals, writing, video text services, radio paging and cellular be substituted for the existing clause. images and sounds or intelligence mobile telephone services) which are made of any nature (other than available to users by means of any transmission broadcasting services) and or reception of signs, signals, writing, images regulated by the Telecom and sounds or intelligence of any nature, by

12 S No. Draft Rules Suggestions of ICAI Justification Regulatory Authority of India wire, radio, visual or other electro-magnetic ("TRAI") under the Telecom means but shall not include broadcasting Regulatory Authority of India Act, services. 1997;

(x) Generation, transmission, (x) Electricity activities include any activity, As the generation, distribution, transmission of distribution and supply of process, procedure, function, operation, electricity is carried out by the Government, electricity regulated by the technique, treatment or method employed in public and private sector industries and the Central Electricity Regulatory relation to generation of electricity from any activities are regulated by different regulators Commission (“CERC”) under The source of energy, and includes transformation, (Central, State and Joint) under the Electricity Electricity Act, 2003, other than transmission, distribution, or supply of Act 2003, reference to only CERC should be for captive generation (as defined electricity by any mode, or medium, and removed. under The Electricity Rules); further includes intermediate and allied There is a crucial need for improving energy activities thereof; scenario in the country. Cost records will provide relevant information for cost effective energy conservation and consumption at affordable prices for inclusive growth. (xi) Roads and other (xi) Construction and development of Cost and time overrun is a common infrastructure projects that are infrastructure projects and facilities as defined phenomenon in Infrastructure Projects. recipients of concessions; under Schedule VI of the Companies Act, 2013; Effective monitoring of projects, in terms of time and cost, helps to avoid cost and time overrun in completion of industrial projects and thus, benefits the industry immensely.

A proper cost accounting system will enable reporting of the cost and profitability of each of the project on periodic basis leading to cost control. (xii) Active pharmaceutical (xii) Pharmaceutical activities, bulk drugs, The Draft Rules include active pharmaceutical ingredients or bulk drugs & intermediates or formulation activities included ingredients or bulk drugs and formulation formulations included in Chapter under Chapters 29 and 30 of the Central Excise included in Chapter 30 of the CETA. It may be

13 S No. Draft Rules Suggestions of ICAI Justification 30 of the Central Excise Tariff Act; Tariff Act, 1985; noted that Chapter 30 deals with Pharmaceutical products whereas the active pharmaceutical ingredients for Bulk Drugs are covered under Chapter 29, which is missing and should be included.

(xiii) Fertilisers under (xiii) Fertilizer covering nitrogenous, The coverage as provided and used by the administered price mechanism phosphatic, potassic or complex (organic, Ministry of Fertilisers, Government of India, (Urea) or subsidised, included in inorganic or mixed) and included under Chapter should be adopted because fertilizer is an Chapter 31 of the Central Excise 31 of the Central Excise Tariff Act, 1985 important and costly input for agriculture Tariff Act; sector. There is also Government subsidy being provided on fertilizer. Therefore, all fertilisers should be covered by the Rules.

(xiv) Sugar and industrial (xiv) Sugar, Sugar Products and Industrial The coverage as provided and used by the alcohol included in Chapters 17 Alcohol included in Chapters 17 and 22 of the industry and central excise, should be adopted, and 22 of Central Excise Tariff Act; Central Excise Tariff Act 1985; as exclusion of items is not justified.

(xv) Petroleum products under (xv) Petroleum Industry including production, Most of the petroleum products are joint administered price mechanism processing, manufacturing mining, storage, products and the costing of the same is done (Diesel, PDS Kerosene, Domestic transportation or distribution of crude oil, through a common cost accounting system. LPG and Cooking Gas) or gases or any other petroleum products Therefore, it is difficult to have segregation for subsidised; included under Chapter 27 of the Central Excise specific products. In addition, the same product Tariff Act 1985; from the same production process is sold at market price as well as through administrated price and therefore it will be illogical to differentiate between Price controlled products and other items produced out of the same production facility. The cost of each product depends upon the overall productivity of the facility, therefore all the products should be

14 S No. Draft Rules Suggestions of ICAI Justification covered to ensure the monitoring of the same.

(c) Other companies (c) Other companies (xvi) Railway or Tramway (xvi) Railway or Tramway locomotives, rolling Railway is an important sector of the Indian locomotives, rolling stock, railway stocks and parts thereof; railway or tramway Economy. Adequate coverage of industries or tramway fixtures and fittings, track fixtures and fittings and parts thereof; under this head is required and should cover all mechanical (including electro mechanical (including electro-mechanical) the articles under Chapter 85 and 86. mechanical) traffic signalling traffic signalling equipment of all kinds included equipment’s of all kind as in Chapter 85 and 86 of the Central Excise Tariff included in chapter 86 of Central Act 1985; Excise Tariff Act;

(xvii) Mineral products included (xvii) Cement, Articles of Cement and Mineral Cement, Articles of Cement and Mineral in Chapter 25 of the Central Excise Products included in Chapters 25, and 26, 68 Products are the key inputs for industries and Tariff Act; and 69 of the Central Excise Tariff Act 1985 infrastructure projects. Infrastructure is a (Items (xvii) & (xviii) should be combined). strategic industry due to its facilitating and multiplier effects. Effective cost and time management will help the industry to become more competitive. The coverage should be broadened as the production process destroys environment and therefore, natural resources should be used optimally (xviii) Ores included in Chapter (xviii) Cement, Articles of Cement and Mineral Cement, Articles of Cement and Mineral 26 of the Central Excise Tariff Act; Products included in Chapters 25, and 26, 68 Products are the key inputs for industries and and 69 of the Central Excise Tariff Act 1985 infrastructure projects. Infrastructure is a (Items (xvii) & (xviii) should be combined). strategic industry due to its facilitating and multiplier effects. Effective cost and time management will help the industry to become more competitive. The coverage should be broadened as the production process destroys

15 S No. Draft Rules Suggestions of ICAI Justification environment and therefore, natural resources should be used optimally (xix) Mineral Fuels, mineral oils (xix) Mineral Fuels (other than Petroleum) Mining sector is an important segment of the etc. included in Chapter 27 of the included in Chapter 27 of the Central Excise Indian Economy. There has been a pronounced Central Excise Tariff Act (such as Tariff Act 1985; growth in the mineral production both in terms coal, lignite, peat, coke, coal gas of quantity and values. Effective cost etc.); management will ensure optimum usage of scarce natural resources and help the industry become more competitive.

(xx) Base metals included in (xx) Base Metals and articles thereof included These are commodity products having major Chapters 72, 73, 74, 75, 76, 78, 79, in Chapters 72 to 83 (excluding Chapter 77) of impact on most of manufacturing sector. These 80 and 81 of the Central Excise the Central Excise Tariff Act 1985; are input of all the industries and being scarce Tariff Act; resource assume strategic importance.

(xxi) Inorganic chemicals, (xxi) Organic, Inorganic Chemicals and chemical Organic, Inorganic Chemicals and Chemical organic or inorganic compounds products, Polymers, PVC, Polyurethane, Resins Products, Polymers, PVC, Polyurethane, Resins, of precious metals, of rare-earth included in Chapters 28, 29, 32, & 38 & 39 of Plastics and articles thereof included in metals, of radioactive elements or the Central Excise Tariff Act 1985; Chapters 28, 29, 32, 34, 38 & 39 of the Central of isotopes included in Chapter 28 Excise Tariff Act 1985 should be covered as of the Central Excise Tariff Act, those are similar in nature. Organic Chemicals included in Chapter 29 of the Central Excise Tariff Act;

(xxii) Aircraft, spacecraft, that (xxii) Aircraft, spacecraft and parts thereof The condition of 90% investment made by are funded (investment made in included in Chapter 88, of the Central Excise Government is not relevant in India as the company) to the extent of Tariff Act; disinvestment has been made in almost all 90% or more by the Government (Items (xxii) & (xxiii) should be combined). sectors to encourage the participation of or Government Agencies; private players.

16 S No. Draft Rules Suggestions of ICAI Justification

(xxiii) Vehicles, aircraft, vessels (xxiii) Vehicles, aircrafts, vessels, ships, boats, The condition of 90% investment made by and associated transport floating structures, associated transport Government is not relevant in India as equipment, that are funded equipments, parts and accessories thereof disinvestment has been made in almost all (investment made in the included in Chapter 87 to 89 of the Central sectors to encourage the participation of company) to the extent of 90% or Excise Tariff Act, 1985; private players. more by the Government or (Items (xxii) & (xxiii) should be combined). Government Agencies; (xxiv) Jute and Jute Products ; (xxiv) Jute and other textile products included The textile industry including jute and jute in Chapters 50 to 63 of the Central Excise Tariff Product is a sunset industry, yet it is very Act 1985; important in terms of generating employment. It is passing through a crisis. The central government has taken a mission to support and revive the industry. Cost monitoring and optimum utilization of resources is essential to support those initiatives and to make the industry cost competitive.

(xxv) Edible Oil under (xxv) Edible Oil Seeds and Oils (including To ensure the availability of essential Administrative Price Mechanism; Vanaspati) included in Chapter 12 and 15 of the commodities at affordable prices, cost Central Excise Tariff Act 1985; monitoring is essential. (xxvi) Construction Industry (xxvi) Infrastructure as referred to under The coverage should be broadened as Cost where there is any government Schedule VI of The Companies Act, 2013 Management issues are similar for all the concession or grant in any form; (Section 55 and 186) industries included in the infrastructure sector. Not covered Machinery and mechanical appliances and Efficiency and Effectiveness in Capital goods parts thereof, electrical /electronic machinery, industry is a key economic driver. Growth in the equipment, appliances and parts thereof industry accelerates the GDP. Therefore, it included in Chapter 84 and 85 of the Central demands attention and cost monitoring. Excise Tariff Act 1985; Efficient capital goods industry reduces overseas dependence in strategic sectors and

17 S No. Draft Rules Suggestions of ICAI Justification Increase depth in manufacturing. Not covered Plantation Products – Tea, Coffee, Rubber and These products are widely used in the products thereof (including Tyres & Tubes) manufacture and transportation of essential included in Chapters 9 and 40 of the Central commodities and will help in bringing cost Excise Tariff Act 1985; effectiveness and optimum utilisation of natural resources.

Not covered Paper, Paperboard and products thereof Paper is produced using natural capital and included in Chapter 47 and 48 of the Central conservation of the same is national and global Excise Tariff Act 1985; priority. Cost monitoring supports initiatives towards environmental sustainability.

Not covered Glass and Glassware included in Chapter 70 of In view of wide usage by different industries the Central Excise Tariff Act 1985; such as automobiles, healthcare, infrastructure, pharmaceutical, laboratories, packaging industry, the products need higher attention on effective cost management and monitoring.

Not covered Packaged Food Products included under All the essential food items are ingredients of Chapters 2 to 25 of the Central Excise Tariff Act packaged food products. The prices of food 1985 (except chapters 5, 6, 14, 23 and 24); items affect the consumer inflation index and consumption. There is requirement of control over wastages and better monitoring of cost to ensure availability of products at affordable prices.

d) Companies engaged in providing services (xxvii) Provision of healthcare (xxvii) Provision of healthcare services including The mechanism for monitoring the cost of services including check-up and check-up and preventive services, diagnostic healthcare services needs to be in place across

18 S No. Draft Rules Suggestions of ICAI Justification preventive services, diagnostic services, disease management and patient care the value chain to provide affordable services, disease management services provided by a clinical establishment; healthcare services to the masses of the and patient care services including country. in corporate hospitals; (xxviii) Provision of education (xxviii) Provision of education services, other The mechanism for monitoring the cost of services, other than such similar than services falling under philanthropy; education services needs to be in place across services falling under philanthropy the value chain to provide affordable education or as part of social spend and do to the masses of the country. Cost monitoring is not form part of any business. equally important for institutions that are part of social spent. Provided that in the case of a Provided that in case of a multi-product or A Cost Accounting system with above threshold multi-product or a multi services multi-service company where all the activities limits will enable medium sized companies company (i.e. a company of the company do not fall within the activities which are in dire need of Cost Management producing more than one product listed above, the requirements of these Rules system, to compete in the ruthless competitive or service) the requirement under shall be applicable provided the turnover of all world. It is felt that these threshold limits are these Rules shall apply to a the products or services covered under these already in place for the last 2 years and the product or a service for which the Rules in the immediately preceding financial companies have benefited out of the same. individual turnover (from such year is 5% of the total turnover of the company specific product or such specific or rupees twenty crore, whichever is less. service) is rupees one hundred These Rules shall apply to every Company, crore or more: including foreign company defined in sub- section (42) of section 2 of the Act, and engaged in production of any goods or providing any services and wherein, the net worth as on the last date of the immediately preceding financial year exceeds rupees five crore; or wherein the turnover made by the company during the immediately preceding financial year exceeds rupees twenty crores.

Provided further that in case of a These Rules shall apply to every Company, A Cost Accounting system with above threshold

19 S No. Draft Rules Suggestions of ICAI Justification company producing any one including foreign company defined in sub- limits will enable medium sized companies specific product or service section (42) of section 2 of the Act, and which are in dire need of Cost Management covered above, the requirement engaged in production of any goods or system, to compete in the ruthless competitive under these Rules shall be providing any services and wherein, the net world. It is felt that these threshold limits are applicable if the net worth of the worth as on the last date of the immediately already in place for the last 2 years and the company is rupees five hundred preceding financial year exceeds rupees five companies have benefited out of the same. crore or more, or the turnover crore; or wherein the turnover made by the from such product or such service company during the immediately preceding is rupees one hundred crore or financial year exceeds rupees twenty crores. more, whichever is less: Provided also that in the case of a These Rules shall apply to every Company, company engaged in a Strategic including foreign company defined in sub- Industry under this rule, the section (42) of section 2 of the Act, and requirement under these Rules engaged in production of any goods or shall be applicable if the turnover providing any services and wherein, the net of the company is rupees five worth as on the last date of the immediately hundred crore or more: preceding financial year exceeds rupees five crore; or wherein the turnover made by the company during the immediately preceding financial year exceeds rupees twenty crores.

Provided also that in case of No change is suggested. companies engaged in an industry regulated by a sectoral regulator, the requirements of sectoral regulator regarding cost records and cost audit shall be taken into account. (2) Applicability for Cost Audit: - Applicability for Cost Audit: The companies required to These Rules shall apply to every company The objective of maintaining cost accounting include cost records in their books covered under the Companies (Cost Accounting records / cost audit is to ensure optimum

20 S No. Draft Rules Suggestions of ICAI Justification of account in accordance with Records) Rules, 2013 under Sub-Section (1) of utilization of scarce resources and integrity of sub-Rule (1), shall be required to Section 148 and which have such amount of data, that the government / regulatory get such cost records audited by a net worth or the value of the turnover made authorities might require from time to time to cost auditor. by the company from sale or supply of all formulate policies and to regulate tariff; and products or activities during the immediately also to improve cost management at the firm preceding financial year for sectors under level to improve the competitiveness of the different class of companies covered under firm and the economy in the global market and Sub-Section (1) of Section 148 of the Act for to benefit customers in terms of reduced price. maintenance of Cost Records, as under; Mandating maintenance of cost records will a) Companies engaged in Strategic enhance the currently lower maturity level of Sectors: cost management as per CII and other studies. Wherein the net worth as on the last date of

the immediately preceding financial year Mandating medium size companies to maintain exceeds rupees five crore; or the turnover cost records will induce those companies to made by the company during the immediately adopt cost management culture and enhance preceding financial year exceeds rupees one their competitiveness. hundred crore.

b) Companies engaged in an industry Maintenance of Cost Records by the company regulated by a Sectoral Regulator or a engaged in production of goods or providing Ministry, or Department of Central services is essential for identification and, Government: collection of costs, and determination of true Wherein the net worth as on the last date of cost of production of goods or providing of the immediately preceding financial year services. This will ensure availability of quality exceeds rupees five crore; or the turnover product and services at affordable prices for made by the company during the immediately the masses of the Country and protect preceding financial year exceeds rupees consumers against unfair prices and trade twenty crore. practices.

c) Other Companies Wherein the net worth as on the last date of

21 S No. Draft Rules Suggestions of ICAI Justification the immediately preceding financial year exceeds rupees five crore; or the turnover made by the company during the immediately preceding financial year exceeds rupees one hundred crore.

d) Companies engaged in providing services Wherein the net worth as on the last date of the immediately preceding financial year exceeds rupees five crore; or the turnover made by the company during the immediately preceding financial year exceeds rupees twenty crore.

Provided that any company engaged in production of goods or providing services of such products and activities covered under the Companies (Cost Accounting Records) Rules, 2013 meant solely for captive consumption or captive use shall not be covered under these Rules. 4 Maintenance of records- (1) Every company to which these Rules apply, Every company to which these Rules apply shall 1) Every company to which including all units and branches thereof shall, in maintain cost records in accordance with the these Rules apply, including all respect of each of its financial year generally accepted cost accounting principles units and branches thereof shall, commencing on or after the date of this and cost accounting standards issued by the in respect of each of its financial notification, keep and maintain cost records. Institute to the extent these are found to be year commencing on or after the relevant and applicable and the variations, if 1st day of April, 2014, keep cost any, shall be clearly indicated and explained. records in Form “I” specified in Annexure to these Rules. Cost information relating to utilization of

22 S No. Draft Rules Suggestions of ICAI Justification material or labor or other items of cost is vital for companies in order to arrive at relevant and true cost of production and services and helps in timely decision making.

The cost information system is also used for operationalizing the strategies for measuring productivity, profitability etc. through the process of Cost Accounting. 2) The cost records referred (2) The cost records referred to in sub-Rule to in sub-Rule (1) shall be kept on (1) shall be kept on regular basis in accordance regular basis in such manner so as with the Cost Accounting Standards and to make it possible to calculate Generally Accepted Cost Accounting Principles per unit cost of production or cost issued by the Institute in such manner so as to of operations, cost of sales and make it possible to calculate per unit cost of margin for each of its products production or cost of operations or cost of and activities for every financial rendering services, cost of sales and margin for year on monthly or quarterly or each of its products, activities and services. half-yearly or annual basis. The variations, if any, shall be clearly indicated and explained.

3) The cost records shall be (3) These records shall also provide details maintained in such manner so as required to be furnished under sub-section (2) to enable the company to of section 148 of the Act. exercise, as far as possible, control over the various operations and costs with a view to achieve optimum economies in utilization of resources. These records shall also provide necessary data which is required to be furnished under

23 S No. Draft Rules Suggestions of ICAI Justification these Rules. (4) All such cost records and cost statements, maintained under these Rules shall be reconciled with the audited financial accounts specifically indicating expenses or incomes not considered in the cost accounts or statements so as to ensure accuracy and to reconcile the profit of all products, activities and services with the overall profit of the company.

(5) All such cost records and cost statements, All such cost records, cost statements and schedules, etc. for each unit and each product reconciliation statements, maintained under or activity, shall be duly authenticated by a these Rules, relating to a period of not less than person referred to in sub-section (6) of section eight financial year immediately preceding a 128 of the Act and the cost accountant. financial year or where the company had been in existence for a period less than eight years, in respect of all the preceding years shall be kept in good order as per the provision contained in clause 4 (6) of the Companies (Cost Accounting Records) Rules notified by Ministry of Corporate Affairs on 3rd June 2011. (6) It shall be the duty of every person, referred Every person, referred to in sub‐section (8)(a) to in sub-section (6) of section 128 of the Act, of section 148 of the Act, shall take all to take all reasonable steps to secure reasonable steps to secure compliance by the compliance by the company with the provisions company with the provisions of these Rules in of sub-section (1) of Section 148 of the said Act the same manner as he is liable to maintain in the same manner as he is liable to maintain accounts required under sub-section (1) of accounts required under section 128 of the said section 148 of the said Act as per the provision Act. contained in clause 4 (7) of the Companies (Cost Accounting Records) Rules notified by

24 S No. Draft Rules Suggestions of ICAI Justification Ministry of Corporate Affairs on 3rd June 2011. Form of the Cost Record Certificate - Every Under the Section 92 of the Companies Act company to which these Rules apply shall 2013, the annual return filed by a listed submit a Cost Record Certificate, in respect of company or by a company having such paid up each of its financial year commencing on or capital and turnover as may be prescribed, is after the 1st day of April, 2014, duly certified by required to be certified by a Company a cost accountant, along with the Annexure to Secretary in Practice in prescribed form. the Central Government, in the prescribed form. Under Section 134 of the Companies Act 2013, the financial statements including the Provided that the company shall not be consolidated financial statements, if any, as required to submit Cost Record Certificate if all approved by the Board of Directors, is required the products or activities of the company that to be signed by two directors, the CFO and the are covered under these Rules are also covered Company Secretary of the Company. for cost audit under sub-section (2) of section

148 of the Act. On the lines of the above, a Cost Record Certificate should be mandated to be signed by a Cost Accountant in Practice and the suggested procedure should be prescribed therefor. Time limit for submission of Cost Record Under the Section 92 of the Companies Act Certificate – Every company shall submit the 2013, the annual return filed by a listed Cost Record Certificate referred to in Rule 5 to company or by a company having such paid up the Central Government within one hundred capital and turnover as may be prescribed, is and eighty days from the close of the required to be certified by a Company company’s financial year to which the Cost Secretary in Practice in prescribed form. Record Certificate relates. Under Section 134 of the Companies Act 2013, the financial statements including the consolidated financial statements, if any, as approved by the Board of Directors, is required

25 S No. Draft Rules Suggestions of ICAI Justification to be signed by two directors, the CFO and the Company Secretary of the Company.

On the lines of the above, a Cost Record Certificate should be mandated to be signed by a Cost Accountant in Practice and the suggested procedure should be prescribed therefor. Authentication of Annexure to the Cost Record Under the Section 92 of the Companies Act Certificate – The Annexure prescribed with the 2013, the annual return filed by a listed Cost Record Certificate, as certified by the cost company or by a company having such paid up accountant, shall be approved by the Board of capital and turnover as may be prescribed, is Directors before submitting the same to the required to be certified by a Company Central Government by the company. Secretary in Practice in prescribed form.

On the lines of the above, a Cost Record Certificate should be mandated to be signed by a Cost Accountant in Practice and the suggested procedure should be prescribed therefor. Penalties – (1) If default is made by the Cost Accountant in complying with the provisions of these Rules, he shall be punishable as provided

26 S No. Draft Rules Suggestions of ICAI Justification under sub-section (3) of section 469 of the Act.

(2) If a company contravenes any provision of these Rules, the company and every officer thereof who is in default shall be punishable as provided under sub-section (3) of section 469 read with clause (a) of sub-section (8) of section 148 and sub-section (6) of section 128 of the Act.

5 Cost Audit :- Cost Audit :- The procedure relating to appointment of a 1) Every company covered Appointment of Cost Auditor – cost auditor and other relevant provisions such under sub-Rule (2) of Rule 3 shall (1) Every company as specified in Rule 3 shall, as procedure for submission and e-filing of cost within one hundred and eight within one hundred and eighty days of the audit report should be specified in the Rules for days of the commencement of commencement of every financial year, clarity. every financial year appoint a cost appoints a cost auditor. auditor at a remuneration to be Provided that before such appointment is determined in accordance with made, written consent of the cost auditor to provisions of sub-section (3) of such appointment, and a certificate that the section 148 and Rules made appointment, if made, shall be in accordance thereunder. with the provisions of sections 139, 141 and 148 of the Act and Rules made thereunder, as applicable, shall be obtained from the cost auditor.

2) Every cost auditor, who (2) In respect of cost auditor as specified in conducts an audit of the cost sub-Rule (1), the Board of Directors of the records of the company, shall company shall be responsible for, - submit the cost audit report (a) appointment, re-appointment, alongwith his or its reservations or remuneration and terms of appointment of the qualifications or observations or cost auditor of the company; suggestions in the Form II (b) rotation of cost auditor as per provisions of

27 S No. Draft Rules Suggestions of ICAI Justification specified in Annexure to these sub-sections (2), (3) and (4) of section 139 of Rules. the Act, as applicable; (c) satisfying itself with the eligibility, qualifications, and disqualifications of cost auditor, as per the criteria provided in section 141 of the Act, as applicable. 3) Every cost auditor shall (3) Where a company is required to forward his report to the Board constitute an Audit Committee under section within one hundred and eighty 177 of the Act, all appointments, including the days from the close of the filling of a casual vacancy of a cost auditor, shall company’s financial year to which be made after taking into account the the report relates. recommendations of such committee. The Audit Committee shall also be responsible for all the functions as specified under clause (a) to (c) of sub-Rule (2). The cost auditor, wherever appointed shall attend and participate at the concerned meeting of the Audit Committee or of the Board, as the case may be, but shall neither be a member nor have the right to vote. 4) The provisions of sub- (4) Every cost auditor appointed under sub- section (12) of section 143 of the Rule (1) shall hold office till one hundred and Act and the relevant Rules made eighty days from the close of the company’s thereunder shall apply mutatis financial year or till he submits the cost audit mutandis to a cost auditor during report, for the financial year for which he has performance of his functions been appointed. under section 148 of the Act and Provided that where the company fails to these Rules. furnish cost accounting records to the cost auditor so as to enable the cost auditor to submit his report within one hundred and eighty days from the close of the financial year,

28 S No. Draft Rules Suggestions of ICAI Justification the cost auditor shall continue to hold office till he submits the cost audit report for that financial year and the cost auditor shall make a report to the Central Government regarding non-furnishing of the cost accounting records by the company to enable him/it to submit its report. Provided further that the cost auditor shall continue to hold office if he has been reappointed for the succeeding year in accordance with Rule 4. (5) Any casual vacancy in the office of cost auditor arising out of death or resignation or removal shall be filled by the Board of Directors within thirty days and the newly appointed cost auditor shall hold the office for the balance period for the financial year for which he is appointed as per provision of sub-Rule (4) of Rule 4. (6) Every company as specified in sub-Rule (1) shall inform the cost auditor concerned of his or its appointment and also file a notice of such appointment with the Central Government within thirty days of the Board meeting in which the cost auditor is appointed or within one hundred and eighty days of the commencement of the financial year, whichever is earlier, through electronic mode, in the prescribed form, alongwith with such fees or additional fees as prescribed under the Rules notified under section 403 of the Act.

29 S No. Draft Rules Suggestions of ICAI Justification (7) Every company appointing more than one cost auditor shall appoint or designate one of the cost auditors as the Lead Auditor of the Company. Removal of Cost Auditor – A cost auditor appointed under sub-Rule (1) or under sub-Rule (5) of Rule 4 may be removed from his office before the expiry of his term only by a resolution of the Board, after obtaining the previous approval of the Central Government in that behalf in the prescribed form, alongwith with such fees or additional fees as prescribed under the Companies (Fees of Applications) Rules notified under section 459 of the Act.

Provided that before taking any action under this rule, the cost auditor concerned shall be given a reasonable opportunity of being heard.

Remuneration of Cost Auditor – Every company appointing a cost auditor under sub- Rule (1) or under sub-Rule (5) of Rule 4 shall determine his or its remuneration in accordance with Rule 10.11 prescribed under Chapter X of the Companies Act, 2013.

Cost Auditor to sign the cost audit reports, etc. (1) A person or where a firm of cost accountants or limited liability partnership firm is appointed as a cost auditor of the company under sub-Rule (1) or under sub-Rule (5) of Rule 4, the cost auditor’s report or any other

30 S No. Draft Rules Suggestions of ICAI Justification document or cost statements of the company shall be signed by such person or by any of the partners of the firm responsible for the conduct of cost audit in his own hand along with his membership number, for and on behalf of the firm, and in accordance with the provisions of sub-section (2) of section 141 of the Act, as applicable. In any case the report should not be signed by merely affixing the firm’s name.

(2) A company where more than one cost auditor is appointed, the cost auditor’s report or any other document or cost statements pertaining to its area of audit shall be signed by such person or by any of the partners of the firm responsible for the conduct of cost audit in his own hand alongwith his membership number, for and on behalf of the firm. In any case the report should not be signed by merely affixing the firm’s name.

Provided that where a firm including a limited liability partnership is appointed as a cost auditor of a company, only the partners practising in India who are qualified for appointment as a cost auditor shall be authorised to act and sign on behalf of the firm.

Form of the Report – The Cost Auditor may have to record (1) Every cost auditor, who conducts an audit of reservations, qualifications, observations, the cost records of the company, shall within suggestions or reasons to believe that an one hundred and eighty days from the close of offence involving fraud is being or has been

31 S No. Draft Rules Suggestions of ICAI Justification the company’s financial year to which the committed against the company by officers or report relates, submit the cost audit report the employees of the company. along with auditor’s observations and suggestions, and Annexure to the Board of Thus Form II as prescribed under the Directors of the company in the prescribed Companies (Cost Audit Report) Rules 2011 form. notified by MCA on 3rd June 2011. (2) The cost auditor shall, within thirty days of submission of his report to the Board, inform the same to the Central Government, in the prescribed form, along with such fees or additional fees as prescribed under the Rules notified under section 403 of the Act. (3) Every company specified in Rule 3 shall, keep and maintain cost details, statements, schedules, etc. as prescribed under the Companies (Cost Accounting Records) Rules 2013, for each unit and each product or activity, duly authenticated by at least two Directors of the company and the cost auditors. (4) Every cost auditor, who submits a report under sub-Rule (1), shall also furnish performance appraisal report in Form III, duly authenticated by the cost auditor, to the Board of the company. (5) The cost details, statements, schedules, etc. of every company, as specified in sub-Rule (3), relating to a period of not less than eight financial years immediately preceding a financial year, or where the company had been in existence for a period less than eight years,

32 S No. Draft Rules Suggestions of ICAI Justification in respect of all the preceding years shall be kept in good order; Cost Auditor to be furnished with the cost accounting records etc.- Without prejudice to the powers and duties the cost auditor shall have under sub- section (5) of section 148 of the Act, the company and every officer thereof, including the persons referred to in sub-section (6) of the section 128 of the Act, shall make available to the cost auditor, such cost accounting records, cost statements, other books and documents, and Annexure to the Report, duly completed, as would be required for conducting the cost audit, and shall render necessary assistance to the cost auditor so as to enable him to complete the cost audit and submit his report within the time limit specified in sub-Rule (1) of Rule 8. Authentication of Annexure to the Cost Audit Report – The Annexure prescribed with the cost Audit report shall be approved by the Board of Directors before submitting the same to the cost auditor. The Annexure, duly audited by the cost auditor, shall also be signed by the Company Secretary and at least one Director on behalf of the company. In the absence of Company Secretary in the company, the same shall be signed by at least two Directors. Filing of cost audit report with the Central Government - In compliance with the provisions of sub-section (6) of section 148 of

33 S No. Draft Rules Suggestions of ICAI Justification the Act, every company as specified in Rule 3 shall, within thirty days from the date of receipt of a copy of the cost audit report furnish the Central Government with such report alongwith full information and explanation on every reservation or qualification contained therein, in the prescribed form, alongwith with such fees or additional fees as prescribed under the Rules notified under section 403 of the Act.

In case of a company having more than one cost auditor, the company shall furnish the Central Government with the consolidated report of the company as prepared by the lead cost auditor according to proviso to sub-Rule (1) of Rule 9 above duly signed by the Company Secretary and at least one Director on behalf of the company and the lead cost auditor. In the absence of Company Secretary in the company, the same shall be signed by at least two Directors. Penalties – (1) If default is made by the cost auditor in complying with the provisions of these Rules, he shall be punishable as provided under sub- section (3) of section 469 read with clause (b) of sub-section (8) of section 148 of the Act. (2) If a company contravenes any provisions of these Rules, the company and every officer thereof who is in default shall be punishable as provided under sub-section (3) of section 469

34 S No. Draft Rules Suggestions of ICAI Justification read with clause (a) of sub section (8) of section 148 of the Act. Savings – The supersession of the Companies (Cost Audit Report) Rules, 2011, shall not in any way affect- a) any right, obligation or liabilities acquired, accrued or incurred thereunder; b) any penalty, forfeiture or punishment incurred in respect of any contravention committed thereunder; and c) any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and; any such investigation, legal proceeding or remedy may be instituted, continued or enforced and any such penalty, forfeiture or punishment may be imposed as if those Rules had not been superseded. 6 Rules not to apply in certain These Rules shall apply to export oriented Maintenance of Cost Accounting Records and cases:- These Rules shall not apply companies also, even if such units are Cost Audit ensures optimum utilization of to companies which are export operating out of Special Economic Zones. resources, productivity analysis and improved oriented having more than management decision making and this makes seventy five per cent of their the companies more cost competitive, thus revenue in the form of earnings in there is no reason for leaving out these foreign exchange or if such units companies out of the ambit of Cost Accounting are operating out of Special Records and Cost Audit in the public interest. Economic Zones. Only 100% Export Oriented Units or units located in SEZs, FEZc and EPZs should be

35 S No. Draft Rules Suggestions of ICAI Justification exempted from Cost Audit in line with CAB circular dated 25th May 2012.

If any such exempted unit either relocates outside the specified zones or loses 100% EOU status, then the mandatory cost audit would become applicable from the year in which such change has taken place and for every subsequent year thereafter. 7 Savings :- Savings – (1) The following Rules are (1) The following Rules are repealed:- repealed:- (a) Companies (Cost Accounting Records) Rules, a) Companies (Cost Accounting 2011. Records) Rules, 2011. (b) Companies (Cost Audit Report) Rules, b) Companies (Cost Audit Report) 2011. Rules, 2011. (c) Cost Accounting Records c) Cost Accounting Records (Telecommunication Industry) Rules 2011; (Telecommunication Industry) (d) Cost Accounting Records (Petroleum Rules 2011; Industry) Rules 2011; d) Cost Accounting Records (e) Cost Accounting Records (Electricity (Petroleum Industry) Rules Industry) Rules; 2011; 2011; (f) Cost Accounting Records (Sugar Industry) e) Cost Accounting Records Rules; 2011; (Electricity Industry) Rules; (g) Cost Accounting Records (Fertilizer Industry) 2011; Rules 2011; f) Cost Accounting Records (h) Cost Accounting Records (Pharmaceutical (Sugar Industry) Rules; 2011; Industry) Rules 2011; g) Cost Accounting Records (2) The supersession of such Rules shall not (Fertilizer Industry) Rules affect things done or omitted to be done 2011; before such repeal. h) Cost Accounting Records

36 S No. Draft Rules Suggestions of ICAI Justification (Pharmaceutical Industry) Rules 2011;

(2) The supersession of such Rules shall not affect things done or omitted to be done before such repeal.