Skip to content

CMA Intermediate · Corporate Accounting and Auditing · Cost Audit

A company received the cost audit report on 5 March. It must furnish the Central Government with the report along with full information and explanation on every reservation or qualification. Which statement is correct under section 148(6)?

The company must furnish the report to the Central Government within thirty days from the date it receives a copy, here by 4 April, with full information and explanation on every reservation or qualification. This duty is automatic and rests on the company, not on the cost auditor.

  1. AThe company must do so within thirty days from the date of receipt of the report, that is by 4 AprilCorrect
  2. BThe company must do so within thirty days from the end of the financial year
  3. CThe cost auditor must do so within thirty days from the date of signing the report
  4. DThe company must do so only if the Central Government calls for it under section 148(7)

Explanation

Section 148(6) requires the company to furnish the report within thirty days from the date of receipt of a copy, with full information and explanation on every reservation or qualification. Thirty days from 5 March ends on 4 April. Section 148(7) is a separate power to call for further information, so the duty in (6) does not depend on it. The duty rests on the company, not the cost auditor.

Did you get it right without looking?

One question tells you little. A timed set on Cost Audit shows your real accuracy, how long you take and where you lose marks.

Practise Cost AuditFree diagnostic mock

More Cost Audit questions