Amendment in Companies (Cost Records and Audit) Rules, 2014
The Ministry of Corporate Affairs vide Notification F. No. 1/40/2013-CL-V dated December 31, 2014 has made amendment in the Companies (Cost Records And Audit) Rules, 2014 through Companies (Cost Records and Audit) Amendment Rules, 2014 (the New Cost Audit Rules).
Some salient features of the New Cost Audit Rules are as follows:
- The Companies are required to maintain Cost Records if turnover exceeds Rs. 35 crores or more during immediately preceding Financial Year in respect of the products and services specified;
- The New Cost Audit Rules has categorised the Entities into Regulated Sector and Unregulated Sectors;
- The Entities falling under the Regulated sectors having overall annual turnover of Rs. 50 crores or more and the aggregate turnover of the individual products or services of Rs. 25 crores or more have to get their Cost Records Audited;
- Six sectors are brought under the Regulated category namely Telecommunication services; Power generation, Transmission, Distribution and Supply; Petroleum products; Drugs and Pharmaceuticals; Fertilisers; Sugar and Industrial alcohol;
- The Entities falling under the Unregulated category viz. Business of plastics and polymers, glass, electrical, textiles, milk powder businesses, etc., having annual turnover of Rs. 100 crores or more and the aggregate turnover of the individual products or services of Rs. 35 crores or more have to get their Cost Records Audited;
- Exemptions are provided to Companies whose revenue from exports, in foreign exchange, exceeds 75% of total revenue and Companies operating from Special Economic Zones.