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Cost Audit Compliance Checklist 2026
A comprehensive 15-point checklist to verify if your company is fully compliant with cost audit requirements under Section 148. Prepared by a Gold Medalist CMA with 22+ years of experience.
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- Verify if your company falls under mandatory cost audit (Section 148)
- Check turnover thresholds — ₹35 Cr (regulated) / ₹100 Cr (non-regulated)
- Confirm CRA-1 cost records are maintained and up to date
- Ensure cost auditor appointment (Form CRA-2) is filed
- Verify product-wise cost of production statements are prepared
- Reconcile cost records with financial accounts
- Check overhead allocation bases are documented and consistent
- Ensure material consumption records match BOM/standards
- Verify labour cost allocation to products/cost centers
- Review inventory valuation methodology
- Check if CRA-3 report for previous year was filed on time
- Verify Form CRA-4 was e-filed within 30 days of CRA-3 receipt
- Review management letter from previous cost audit
- Assess compliance with all applicable Cost Accounting Standards
- Ensure Board resolution for cost auditor appointment is in place
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