Quick Summary
CMA (Cost and Management Accountant) handles cost audit and cost records.
A Cost Accountant, now designated a Cost and Management Accountant (CMA), is a professional qualified by and enrolled with the Institute of Cost Accountants of India (ICAI-CMA), the statutory body set up under the Cost and Works Accountants Act, 1959. CMAs specialise in cost ascertainment, cost control, cost audit and management accounting, helping businesses price products correctly, manage margins and comply with the government's cost record and audit requirements.
Legal basis
The profession is regulated by the Cost and Works Accountants Act, 1959. Members hold one of two designations: ACMA (Associate) or FCMA (Fellow) after prescribed years of practice. In a company context, cost audit is governed by Section 148 of the Companies Act, 2013 read with the Companies (Cost Records and Audit) Rules, 2014, administered by the Ministry of Corporate Affairs (MCA).
What a Cost Accountant does
- Maintains cost records and conducts statutory cost audits for companies in notified industries (e.g. pharmaceuticals, steel, cement, sugar) that cross the turnover thresholds in the 2014 Rules.
- Advises on costing systems, budgeting, standard costing, transfer pricing and profitability analysis.
- Certifies and represents clients on indirect-tax and GST matters, valuation, and cost-related compliance before authorities.
Cost audit forms
| Form | Purpose |
|---|---|
| CRA-1 | Particulars in which cost records are maintained |
| CRA-2 | Intimation of cost auditor appointment to MCA |
| CRA-3 | Cost audit report issued by the CMA |
| CRA-4 | Filing of the cost audit report with MCA in XBRL |
The cost auditor is appointed by the company's Board of Directors, and only a practising CMA (or CMA firm) may sign a cost audit report.
Key Points
- Member of ICAI-CMA
- Cost audit authority
- Cost records maintenance
- Management accounting
- Earlier called ICWA