Contents . . .
Section I: Cost Audit [50 Marks]
- Provisions relating to maintenance of cost Accounting record under the Companies Act; recording and audit compliance of cooperative societies Act, Customs & Excise Act, WTO, Antidumping processing, export – import policy & special provisions of sick industries Act (SICA) etc
- Nature, objects and scope of cost Audit — The concepts of efficiency audit, propriety audit, management audit, social audit.
- Appointment of Cost Auditor — procedure for appointment , his rights, responsibilities, status, relationship and liabilities – professional and legal under the Companies Act, 1956 (1 of 1956), the cost and works Accountants Act, 1959 (23 of 1959).
- Planning the audit — familiarization with the industry, the organisation, the production process systems and procedures, list of records and reports, preparation of the audit programme.
- Verification of records and reports — utilization of statistical sampling methods – verification of performance and statements maintained under the cost Accounting (Records) Rules.
- Evaluation of Internal Control Systems — Budgetary Control, capacity utilization, inventory control, management information system.
- Assessment of the adequacy of the internal audit function.
- Audit notes and Working papers — audit reports to management.
- The cost Audit Reports — contents of the Reports, distinction between “Notes and Qualifications” to the Report. Cost Auditor’s observations and conclusions.
- Professional Ethics and Code of Conduct.
- Relationship between the Statutory Financial Auditors, the internal Auditor and the Statutory Cost Auditor.
- Cost Accounting (Records) Rules under clause (d) of sub – section (1) of section 209 (issued one year before the examination) and Cost Audit (Reports) Rules issued under section 233 – B of the Companies Act, 1956 (1 of 1956). Critical study of the rules including the prescribed Annexure and proforma applicable to the industries covered.
- Review of Cost Audit Report by the Government: objectives, methods, follow – up actions and disposal of Cost Audit Reports by the Government company and other end – users of the Cost Audit Reports.
- Comparative Studies between cost audit and financial audit with special reference to disclosure of information to members, parliament and the general public.
- Penal provisions for Companies and Cost Auditors.
- Disciplinary proceedings.
Section II: Management Audit leading to other Services [50 Marks]
A. Management Audit
- Meaning, nature and scope, organizational needs for Management Audit and its coverage over and above other audit procedure.
- Audit of the Management processes and Functions, such as planning, organisation, Staffing, Co – ordination, Communication, Direction and Control.
- Evaluation of Management Information and Control Systems with special emphasis on Corporate Image and Behavioural Problems.
- Corporate Development and Management Audit, including operational and propriety aspects.
- Social Cost and Benefit of business enterprises with particular reference to developing countries.
- Audit of social responsibility of management.
- Corporate governance and Audit Committees.
B. Other Services
- Other service sector to the Management, Certification for various purposes – the records to be verified and the safeguards to be taken – the form and content of the certificates.
- Cost audit as an aid to management, Government, shareholders, other external agencies and the public voluntary Cost Audit.
- Productivity Audit – labour, material and Capital.
- Efficiency audit – audit of sub – systems of an enterprise.
- Assessment and quantification of losses under marine, fire and accident insurance policies.
- Inventory Audits for Banks and other agencies.
- IRDA, Insurance Act, CARC.
- Sultan Chand
- Cost Audit and Management Audit
- Guidance Notes To Cost Audit
- ICWAI’s publication relating to Cost Accounting Record Rules on Various Industries
- The Management Audit
- Efficiency Auditing
- Cost Audit and Management Audit
- Cost Audit
- A Commentary on Cost Accounting (Records) Rules
Other Relevant Books