Cost Audit Branch (CAB) of MCA was set up to perform the statutory functions u/s 209(1) (d) relating to the maintenance of cost records and u/s 233B relating to the audit of cost records by the companies read with provisions u/s 224(1B), and 227 (1) of the Companies Act, 1956. CAB is manned by professionals drawn from the Indian Cost Accounts Service (ICoAS).
After the enactment of the Companies Act, 2013, CAB is mandated to perform following functions as per the provisions of the Companies Act, 2013:
1. Matters falling under Section 148 of the Companies Act, 2013 including:
a) Policy framing –
(i) Framing policy framework for cost accounting records and cost audit in the corporate sector.
(ii) Identification of class of companies i.e. the industries /sectors for inclusion/exclusion under the provisions of section 148 of the Companies Act,2013.
(iii) Prescription of order/rules for maintenance of cost records and cost audit thereof by Companies including review, rationalization and amendment or modification of the existing ones.
(iv) Processing of cases for exemption under Sec. 462, from the provisionsof Sec.148 ofthe Companies Act,2013.
b) Designing of order/rules and various forms and annexures thereto:
(i) Notification of order/rules and publication thereof in the Official Gazette after legal vetting and Hinditranslation. (ii) Laying of notified orders/rules in both Houses ofParliament.
(iii) Designing & prescription of various formats for maintenance of cost records by various industries/sectors and also for filing cost audit reports with the CentralGovernment.
(iv) Prescription (including revision) and Notification of all e-forms relating to the functions under the CAB.
c) Review and sharing of Cost Audit reports and study conducted thereon:
(i) Receipt, review and analysis of Cost Audit Reports and seeking further information/explanationunder section148(7).
(ii) Providing Cost Audit Reports to other Central Government departments/organizations/agencies and various regulatorybodies.
d) Monitoring and enforcement of the section 148 and other related sections of the companies Act, 2013 and Rules made thereunder:
(i) Monitoring of compliance with the provisions of Section 148 and other related sections of the companies Act, 2013 and Rules made thereunder and issuance of show cause notices to the defaulting companies, its officers in default and cost auditors.
(ii) Monitoring of compliance with section 143(11) of the Companies Act, 2013 read with Companies (Audit Report) Order, 2015, as far as it relates to maintenance of cost records and cost audit and issuance of show cause notices to the statutory auditors. Referring of these cases to the competent authority for initiating action against these statutory auditors.
(iii) Initiating prosecution proceedings under section 148(8) read with Section 147 through ROCs/RDs against the defaulting companies, its officers in default and cost auditors for non-compliance with Section 148 and other related sections ofthe Companies Act, 2013 and Rules madethereunder.
(iv) Referring the above cases of defaulting Cost Auditors and Statutory Auditors to their respective professional Institutes also namely, the Institute of Cost Accountants of India and the Institute of Chartered Accountants of India for disciplinary action.
(v) Identifying the cases which warrants inspection and referring the same for approval by the Secretary, MCA. Thereafter, inspection to be done by ROC along with representatives of Cost Audit Branch.
2. Processing initial applications and appeal cases under the RTI Act, 2005 relating to the CAB functions.
3. Providing requisite material and coordination in respect of all Parliament matters and Court matters relating to CAB.
4. Rendering professional assistance to the Institute of Cost Accountants of India in developing Cost Auditing Standards, Cost Accounting Standards. Guidance Notes, Management Guidelines, Monographs, etc. required for the growth and development of Cost & Management Accounting in India.
5. Miscellaneous Matters:
a) Framing of Annual Action Plan for the CAB.
b) Submission of other O&M returns.
c) Providing expert opinion on various matters referred to the CAB.
d) Establishment matters relating to staff posted at CAB.
[dt_sc_button type=”type1″ link=”http://mca.gov.in/Ministry/pdf/inductionmaterial.pdf” size=”medium” target=”_blank” timeline_button=”no”]MCA Induction Material – 30-03-2017[/dt_sc_button]