RIGHTS & DUTIES OF COST AUDITOR

APPOINTMENT OF COST AUDITOR

Appointed by the B.o.D under sec 233-B of the Companies Act. Specific order from Company Law Board. B.O.D required to pass a resolution in its meeting or curriculum. Appointment made on receipt of order from Central Govt. He should hold certificate from ICWA Consent of cost auditor. Appointment letter. Communicate with previous auditor.

Eligibility for Appointment of Cost Auditor

Foll. persons are eligible Any such chartered accountant within the meaning of the chartered accountant act and has passed examination of the ICWA of India Cost accountant within the meaning of the cost and works accountant act, or Other person, as may hold the prescribed qualification for a cost auditor

Rights of cost auditor

To get all facilities & assistance from the related company or organisation to perform his duties as a cost auditor. Check at all times to the company records The company and every officer give explanation to cost auditor in case of default. Has access to the books of accounts and vouchers.

Duties of a Cost Auditor

He should maintain his working papers as an evidence of his having carried out his duties. Responsible to answer queries Liable to company if not perform duty properly Owes a legal responsibility to third parties. Should not disclose any confidential informations He is criminally liable for falsification of books.

THE SATHYAM SCAM

Nearly three years after the Satyam scambroke out, the Institute of Chartered Accountants of India (ICAI) has finally found Vadlamani Srinivas, erstwhile chief financial officer (CFO) of Satyam Computers, and Talluri Srinivas, former partner of PriceWaterhouseCoopers (PWC), then statutory auditors of Satyam, guilty of

 The findings of the committee, headed by former president of ICAI Uttam Prakash Agarwal, states that though the statutoryauditors ofSatyam Computerswas Price Waterhouse, however,in realitythe audits were conducted byLovelock& Lewes, thereby breaching the mandatory confidentiality clause that every practising chartered accountant needs to follow under theChartered AccountantsAct, 1949.

. It was only last month that ICAI barred two chartered accountants of Lovelock & Lewes -- Pulavarthi Siva Prasad and Chintapatla Ravindernath, imposed a Rs 5 lakh penalty each and ordered striking off their names from the register of members permanently after they were found to have been grossly negligent in carrying out the statutory audit of Satyam from 2001 to 2008.

Thank you