The Corporate Affairs Ministry, which is implementing the new companies law, came out with revised rules for cost records and audit on June 30.
The new rules "defies logic... and have totally ignored the fact that cost audit has a perfect synergy with the enterprise governance framework", the Institute of Cost Accountants of India (ICAI) said in a statement.
According to the institute, the latest rules have been prepared on the philosophy that cost records should be maintained only in those industries where policy intervention might be required while ignoring the fact that cost accounting norms were not just to bolster administered pricing.
Contending the new norms would "adversely impact the competitiveness of the Indian industry," ICAI said it hopes the cost rules 2014 would be reviewed and modified in the interests of stakeholders.
"The cost rules 2014 has merged cost accounting records rules and cost audit rules. The present rules have no reference to maintenance of records on the basis of Generally Accepted Cost Accounting Principles and Cost Accounting Standards unlike the 2011 rules," the statement said.
The new cost audit rules cover strategic, regulated and sectors where public interest is involved.
"However the industries listed have excluded large number of sectors that have been considered to be strategic, consuming huge resources and in public interest that were covered earlier," the statement said.
Requesting changes in the rules, the institute has already written to Corporate Affairs Minister Arun Jaitley in this regard.
"The changes made in the new Rules will severely affect the profession, its members and students totalling to around 6,00,000, the stakeholders and the Indian economy at large," ICAI had said in its letter to Jaitley dated July 1.