# Cost Audit & CRA Filings

> Companies in sectors notified under the Companies (Cost Records and Audit) Rules, 2014 must get their cost records audited by a practising Cost Accountant once they cross the thresholds — ₹50 crore overall turnover with ₹25 crore from covered products in regulated sectors, or ₹100 crore with ₹35 crore in non-regulated sectors. The auditor's appointment is filed in Form CRA-2, and the cost audit report in CRA-4 within 30 days of receiving it.

Practice: CMA & Cost Accounting — https://www.industax.com/services/cma-cost-accounting/

Cost audit is about the reliability of product and process costs, not the financial statements. Its findings often reveal where margins are lost — yields, wastage, overhead allocation.

We prepare cost records and reconciliations with the financial accounts and coordinate the audit with partner Cost Accountants, then file the CRA forms.

## Key facts

| Item | Detail |
| --- | --- |
| Regulated sectors | ₹50 crore turnover, ₹25 crore from covered products |
| Non-regulated sectors | ₹100 crore turnover, ₹35 crore from covered products |
| Appointment | CRA-2 within 30 days of board meeting (or 180 days from year start) |
| Report filing | CRA-4 within 30 days of receipt |
| Who audits | Practising Cost Accountant |

## Who needs this

- Manufacturers in notified sectors
- Companies crossing the thresholds
- Companies with pending CRA filings

## What's included

- Applicability check
- Cost records and reconciliations
- Audit coordination
- CRA-2 and CRA-4

## Documents

- Production and cost data
- Financial statements
- Product-wise turnover

## Process

1. **Test** — Applicability confirmed.
2. **Prepare** — Records and reconciliations.
3. **File** — Audit and CRA forms completed.

Work that legally requires a practising Cost Accountant is signed by a partner professional; Indus Tax coordinates it.

## FAQs

### Is cost audit the same as cost records?

No. Cost records (CRA-1) must be maintained from ₹35 crore turnover in notified sectors; cost audit applies only above the higher thresholds.

### Can the statutory auditor do the cost audit?

No. The cost auditor must be a practising Cost Accountant and can't be the company's statutory auditor.

### What if CRA-4 is filed late?

Additional fees apply, and the company and officers can face penalties for non-compliance.

## Official sources

- MCA — Companies (Cost Records and Audit) Rules, 2014: https://www.mca.gov.in/
- Institute of Cost Accountants of India: https://icmai.in/

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Canonical page: https://www.industax.com/services/cma-cost-accounting/cost-audit-cra
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.