Skip to content

CMA Intermediate · Corporate Accounting and Auditing · Cost Audit

The cost auditor of Ganga Chemicals Ltd has completed the audit of cost records under section 148. To whom must the report on the audit of cost records be submitted by the cost accountant?

The cost auditor submits the report to the Board of Directors of the company, as the proviso to section 148(5) provides. The company, not the cost auditor, later sends the report to the Central Government. The report does not go to members or the statutory auditor.

  1. AThe Central Government
  2. BThe members at the annual general meeting
  3. CThe Board of Directors of the companyCorrect
  4. DThe statutory auditor of the company

Explanation

The proviso to section 148(5) states that the report on the audit of cost records shall be submitted by the cost accountant to the Board of Directors. The company then furnishes a copy to the Central Government under section 148(6). The cost auditor does not report directly to the Government or to members.

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