Test 801

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Subject: Cost and Management Audit

Total Number of Question: 40

Time: 41 Minutes

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Phone No

State

11.

Under which section of the Companies Act, 2013, is the cost audit regulated?

Section 139

Section 148

Section 134

Section 135

12.

Which type of companies are required to maintain cost records as per the Companies Act, 2013?

All listed companies

Specified companies engaged in manufacturing or production of goods/services

All unlisted companies

Non-profit companies

13.

The Companies (Cost Records and Audit) Rules, 2014, are issued under which Act?

Income Tax Act

Companies Act, 1956

Companies Act, 2013

GST Act

14.

Who has the authority to appoint a cost auditor?

Shareholders

Board of Directors

Ministry of Corporate Affairs

Registrar of Companies

15.

Which of the following is NOT a qualification for a cost auditor?

Member of ICMAI

Experience in cost management practices

Member of ICAI

Independent of the company’s management

16.

What is the tenure of a cost auditor’s appointment?

1 year

3 years

5 years

Until revoked by the shareholders

17.

What is the primary objective of maintaining cost records?

Filing of GST returns

Analysis of profitability

Statutory compliance and cost control

Financial statement preparation

18.

Cost records must be maintained for a period of at least how many years?

3 years

5 years

7 years

10 years

19.

Which Rule specifies the maintenance of cost records in prescribed industries?

Rule 2 of the Companies (Cost Records and Audit) Rules, 2014

Rule 3 of the Companies (Cost Records and Audit) Rules, 2014

Rule 4 of the Companies (Audit and Auditors) Rules, 2014

Rule 5 of the Companies (Management and Administration) Rules, 2014

20.

Which industries are mandatorily required to conduct cost audits under the rules?

Pharmaceuticals and textiles

Healthcare and education

Manufacturing and regulated sectors like power and telecom

Retail and agriculture

21.

Cost Audit Reports are submitted to the Board of Directors in which form?

CRA-1

CRA-3

CRA-2

CRA-4

22.

Form CRA-4 is used to submit cost audit reports to the:

Audit Committee

Ministry of Corporate Affairs (MCA)

Registrar of Companies (ROC)

Securities and Exchange Board of India (SEBI)

23.

What is the penalty for non-compliance with cost audit provisions under the Companies Act, 2013?

Fine of up to ₹1 lakh

Fine of up to ₹10 lakh

Imprisonment up to 1 year

Both fine and imprisonment

24.

Which body is primarily responsible for issuing cost audit standards in India?

ICAI

ICMAI

SEBI

MCA

25.

Which statutory authority governs the enforcement of cost audit provisions?

Reserve Bank of India (RBI)

Ministry of Finance

Ministry of Corporate Affairs (MCA)

Securities and Exchange Board of India (SEBI)

26.

What is the deadline for the cost auditor to submit the audit report to the company?

90 days from the end of the financial year

180 days from the end of the financial year

30 days from the end of the financial year

150 days from the end of the financial year

27.

The cost audit report must be filed with the MCA within how many days of receiving it from the cost auditor?

15 days

30 days

45 days

60 days

28.

Cost audit is mandatory for companies meeting which threshold?

Turnover of ₹25 crore or more

Turnover of ₹35 crore or more

Turnover of ₹50 crore or more

29.

Which companies are exempt from cost audit despite falling under the specified industries?

Companies operating in SEZs

Companies engaged in 100% exports

Small-scale companies

All of the above

30.

If a company ceases operations during the financial year, are cost records still required?

Yes, cost records are mandatory for the entire year.

No, cost records are not required for the ceased period.tomatically

Only required until the cessation date.

Cost audit is waived off automatically

31.

The cost auditor’s primary role is to:

Evaluate statutory compliance of taxes.

Ensure the cost records are accurate and align with cost audit standards.

File annual returns on behalf of the company

Investigate fraud in financial statements.

32.

Can the cost auditor be a relative of a director of the company?

Yes, with proper disclosure.

No, it violates independence criteria.

Only if approved by shareholders.

Yes, if not directly involved in decision-making

33.

In case of resignation, a cost auditor must inform:

The Board of Directors

The Ministry of Corporate Affairs

The Audit Committee and MCA

The shareholders directly

34.

Cost auditors must follow the cost audit standards issued by:

Reserve Bank of India

Ministry of Corporate Affairs

Institute of Cost Accountants of India (ICMAI)

Securities and Exchange Board of India

35.

Which of the following is NOT part of cost audit standards?

Scope of audit

Financial statement analysis

Audit documentation

Reporting framework

36.

Cost audit standards are mandatory for:

All types of audits conducted by ICMAI members

Only statutory cost audits

Internal audits

Compliance audits under GST

37.

The cost audit report must be signed by:

Statutory auditor

Any member of the Board of Directors

The cost auditor and company secretary

The cost auditor with their ICMAI membership number

38.

Disclosure of cost audit details is included in which company document?

Financial Statements

Annual Report

Director’s Report

Auditor’s Report

39.

Filing of CRA-4 is required to be done in:

Physical format only

Digital format through MCA portal

Both physical and digital format

Filing is not required

40.

What is the penalty for the cost auditor for contravening provisions of cost audit?

Fine of up to ₹50,000

Fine of up to ₹1 lakh

Fine and imprisonment for up to 3 years

Only a warning letter from MCA

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