COST RECORD after Amendment Rules 2014

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 20^th 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:-

1. Regulated Sector:
2. Telecommunication services
3. Electricity
4. Petroleum Product
5. Drugs and pharmaceuticals
6. Fertilisers
7. Sugar and industrial alcohol
8. Non – regulated Sectors:
   1. Machinery and mechanical appliances uses in defence, space, atomic energy
   2. Turbo jets and turbo propellers
   3. Arms and ammunitions
   4. Propellant power, prepared explosives, safety fuses, detonating fuses, percussion or detoning caps, igniters, electric detonators,
   5. Radar pparatus, radio navigational aid apparatus and radio remote control apparatus
   6. Tanks and other armoured fighting vehicles etc
   7. Port services
   8. Aeronautical services
   9. Steel
   10. Road and other infrastructure projects
   11. Rubber and allied products
   12. Coffee and tea
   13. Railway and tramway etc
   14. Cement
   15. Ores and Mineral products
   16. Mineral fules
   17. Base metals
   18. Inorganic chemicals, rare earth metals, organic chemicals
   19. Jute and Jute products
   20. Edible Oils
   21. Construction Industry
   22. Health services
   23. Education services
   24. Milk power
   25. Insecticides
   26. Plastic and polymers
   27. Tyres and tubes
   28. Paper
   29. Textiles
   30. Glass
   31. Other machinery
   32. Electricals or electronic machinery
   33. 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 1^st 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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