The Companies (Cost Record and Audit) Rules 2014 as amended by the Companies (Cost Record and Audit) Amendment Rules 2014 shall be applicable from the date of its publication in official gazette of India and published in official gazette. I am yet to find notification in official gazettee untill 20th January 2015. Earlier we have discussed Cost Record under original Rules before these amendment here.
Applicability of Cost Record [Rule 3]:
For the purpose of sub-section (1) of section 148 of the Act, the class of companies, including Foreign Companies defined in sub-section (42) of section 2 of the Act, engaged in the production of goods or providing services specified in the table given in the section having an overall turnover from all its products and services of rupees thirty five crores (Rs. 35,00,00,000.00) or more during the immediately preceding financial year shall include cost record for such product or services in their books of account, namely:-
- Regulated Sector:
- Telecommunication services
- Petroleum Product
- Drugs and pharmaceuticals
- Sugar and industrial alcohol
- Non – regulated Sectors:
- Machinery and mechanical appliances uses in defence, space, atomic energy
- Turbo jets and turbo propellers
- Arms and ammunitions
- Propellant power, prepared explosives, safety fuses, detonating fuses, percussion or detoning caps, igniters, electric detonators,
- Radar pparatus, radio navigational aid apparatus and radio remote control apparatus
- Tanks and other armoured fighting vehicles etc
- Port services
- Aeronautical services
- Road and other infrastructure projects
- Rubber and allied products
- Coffee and tea
- Railway and tramway etc
- Ores and Mineral products
- Mineral fules
- Base metals
- Inorganic chemicals, rare earth metals, organic chemicals
- Jute and Jute products
- Edible Oils
- Construction Industry
- Health services
- Education services
- Milk power
- Plastic and polymers
- Tyres and tubes
- Other machinery
- Electricals or electronic machinery
- Medical devices
This provision related to medical devices is not applicable to foreign companies having only liaison offices in India.
This Rule is also not applicable to micro and small enterprise.
Maintenance of records [Rule 5]
Every company under these rules including all units and branches thereof, shall, in respect of each of its financial year commencing on or after the 1st day of April, 2014, maintain cost records in form CRA – 1.
In case of company covered in serial number 12 and 24 to 32 of item (B) of Rule 3, the requirement shall apply in respect of each of its financial year commencing on or after 1st day of April 2015.
The cost records referred to in sub-rule (1) shall be maintained on regular basis in such manner as to facilitate calculation of per unit cost of production or cost of operations, cost of sales and margin for each of its products and activities for every financial year on monthly or quarterly or half-yearly or annual basis.
The cost records shall be maintained in such manner so as to enable the company to exercise, as far as possible, control over the various operations and costs to achieve optimum economies in utilisation of resources and these records shall also provide necessary data which is required to be furnished under these rules.
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