Skip to content

CMA Final · Cost and Management Audit · Companies (Cost Records and Audit) Rules, 2014

Under section 148(3) of the Companies Act, 2013, who appoints the cost auditor, and how is the remuneration fixed?

The Board appoints the cost auditor, and the remuneration is determined by the members in the manner prescribed. Section 148(3) assigns appointment to the Board and remuneration to the members, so the reverse arrangement is incorrect.

  1. AAppointed by the Board; remuneration determined by the members in the prescribed mannerCorrect
  2. BAppointed by the members; remuneration fixed by the Board
  3. CAppointed by the Central Government; remuneration fixed by the Institute
  4. DAppointed by the Audit Committee alone; remuneration fixed by the cost auditor

Explanation

Section 148(3) says the audit shall be conducted by a cost accountant appointed by the Board on such remuneration as may be determined by the members in the prescribed manner. Option B reverses the roles of the Board and the members.

Did you get it right without looking?

One question tells you little. A timed set on Companies (Cost Records and Audit) Rules, 2014 shows your real accuracy, how long you take and where you lose marks.

Practise Companies (Cost Records and Audit) Rules, 2014Free diagnostic mock

More Companies (Cost Records and Audit) Rules, 2014 questions