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Union of India - Section

Section 28 in The Cost Audit Report Rules, 2001

28. Profit Reconciliation

Particulars Current Year 1stPrevious Year 2ndPrevious Year
1. Profit or Loss as per Cost accounting records      
2. Add : Incomes not considered in cost accounts:      
(a) specify      
(b)      
(c)      
3. Less : Expenses notconsidered in cost accounts:      
(a) (specify)      
(b)      
(c)      
4. Add : Overvaluation of closing stock infinancial accounts      
5. Add : Under valuation of closing stock infinancial accounts      
6. Less : Under-valuation of closing stock infinancial accounts      
7. Less : Overvaluation of opening stock infinancial accounts      
8. Adjustment for others, if any (specify)      
9. Profit or Loss as per financial accounts      
Explanation:- for the purpose of these rules(a)"Capital Employed" means average of fixed assets at net book values (excluding intangible assets, effect of revaluation of fixed assets, capital works-in-progress) and current assets minus current liabilities and provisions existing at the beginning and close of the financial year.(b)"Net Worth" means share capital plus reserves and surplus (excluding revaluation reserve) less accumulated losses and Intangible assets.(c)"Profit" means operating profit after providing for depreciation and all other expenses except Interest on borrowings Including debentures but before providing for taxes on income(d)"Net Sales" means sales excluding sales returns, excise duties sales tax octroi, other local taxes and expenses refundable/recoverable from buyers/customers.(e)"Value Addition" means the difference between the net output value (net sales adjusted for work-in-progress and finished goods stock) and cost of bought out materials and services for the product under reference(f)"Non Moving Stocks" means value of raw materials and components finished and semi-finished which have not moved for more than twelve months. The period shall be twenty four months in case of consumable stores and spare used in workshop, tool rooms or repairs and maintenance(g)"Normal Price" means price charged for comparable and Similar products in the ordinary course of trade and commerce where the price charged is the sale consideration of sale and such sale is not made to a related party.Notes:- (1) If there is any change in the share capital due to merger acquisition buy back of shares, bonus issue etc., during the year under reporting special mention may be made with the reasons therefor.
(2)The profit arrived at for the factory, company and the product shall not include interest and dividend received on investments outside the business capital gains, and any other income which is neither normal nor of recurring nature.The profit so arrived shall be the normal operating profit earned during the current financial period of the company.
(3)Wherever, there is any significant variation in the current year's figure over the previous year's figure, reasons thereof shall be given.
(4)If the company has more than one factory producing the product under reference, separate details shall be indicated in the prescribed annexures in respect of each factory.
(5)If the factory is engaged in the production of the product under reference and any other activities, separate details shall be indicated in the prescribed annexure for the factory as a whole and for the product under reference.
(6)Figures shall be given for the year under audit and for the two preceding years in respect of paragraphs 4 to 26
Signature Signature Signature
Name Name Name
Cost Auditor Company Secretary Director
Seal Stamp Stamp
Date Date Date
ProformaName of the companyName and address of the factoryName of the product:Statement showing the cost of production, cost of sales, sales realisation and margin in respect of the product(s) under reference produced during the year/period:A. Quantitative Information:
Sr. No. Particulars (unit of measurement to bespecified
Current Year Previous Year
1 (i) Installed capacity(ii) Capacity enhanced during the year by leasingarrangement etc.    
2 Actual production/output(i) Self,(ii) third parties, if any    
3 Production as percentage of installed capacity    
4 Captive consumption, if any    
5 Quantity sold(a) Domestic(b) Export    
6 Closing Stock (finished goods)    
7 Opening Stock (finished goods)    
B. Cost Information
Sr. No. Particulars Quantity Rate per unit Amount unit Cost per unit
unit (Rs.) (Rs.) Current Year (Rs.) Previous Year (Rs.)
1 Material consumed (item-wise covering at least80% of items by value)1 Purchased(a) Indigenous (specify)(b) Imported (specify)2. Self manufactured (specify)          
2 Process chemicals (specify)          
3 Utilities1. Purchased(a) Indigenous (specify)(b) Imported (specify)2. Self manufactured (specify)          
4 Direct wages and salaries          
5 Consumable stores and spares          
6 Depreciation          
7 Lease rent, if any          
8 Repairs and maintenance:(a) Building(b) Plant and Machinery(c) Others, if any          
9 Other works overhead          
10 Total Works Overheads (2 to 9)          
11 Royalty, if any          
12 Technical assistance/know-how fee          
13 Research and development          
14 Quality control          
15 Administrative overhead (relating to productionactivities)(a) Salaries and wages(b) Others (specify)(c) Total (a+b)          
16 Total (1+10 to 15)          
17 Adjustment for variances (where standard costingsystem is followed)          
18 Add opening StockLess closing Stock(Work-in-progress)          
19 Less: Credit (from wastage andby-products/Recoveries, if any          
20 Packing cost Primary(a) Materials(b) Others(c) Total          
21 Cost of production (16 to 20)          
22 Finished Goods purchased, if any          
23 Opening StockClosing Stock(finished products)          
24 Total (21+22+23)          
25 Quantity and cost transferred for(i) captive consumption, if any(ii) sales(iii) others, if any          
26 Packing cost Secondary(a) Materials(b) Others(c) Total          
27 Other expenses(a) Administrative overheads (others)(b) Others (specify)          
28 Selling and distribution expenses(a) Salaries and wages(b) Freight and transport charges(c) Commission to selling agents(d) Advertisement expenses(e) Royalty on sales, if any(f) Warranty expenses after adjusting income fromchargeable services(g) Others(h) Total (a to g)          
29 Interest and finance charges:(a) for manufacturing activity(b) Others(c) total          
30 Total cost of sales (excluding excise duty) ofpacked quantity sold (24 to 29)          
31 Sales realisationLess: Excise duty and other statutory levies          
32 Net sales realisation          
33 Margin (33-30)          
34 Add: export benefits and incentives, if any          
35 Total margin (including export benefits)          
36 Ex-factory price (excluding sales tax etc.)          
37 Maximum retail price (excluding sales tax etc.)          
38 Maximum retail price, if any, prescribed by theGovernment/statutory/regulatory body etc.          
Notes: - 1. Separate proforma shall be prepared for each type/variety/ description of product(s) under reference.