Expert panel for quarterly audit to up governance

“The possibility of introducing quarterly limited review of cost details, in case of listed companies, may be examined in consultation with Sebi,” the 13-member group set up to review the cost accounting rules and standards has said.

Internal audits

The group — representing Corporate Affairs Ministry, ICWAI, ICAI, ICSI, CII, FICCI, Assocham, PHDCCI, Sebi, academicians and management consultants among others— is of the view that although cost books could be maintained annually, internal audit should be done on a quarterly basis.

“As at present, periodicity of cost audit should remain on annual basis, a limited review of key parameters that appear in the cost audit report should be considered by the Audit Committee on a quarterly basis for listed companies,” the expert panel pointed out.

Further, it said that at present, companies engaged in manufacturing 44 products, like paper, need to get their cost books audited. The group has also recommended that cost audit be made compulsory for all large-scale manufacturers.