Cost accountancy: tapping the untapped potential

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: Be it the Satyam scam or the issue of the ‘gas price war’ between the Ambani brothers, the Air India strike due to cost cutting measures following heavy losses or even the Delhi Transport Corporation (DTC) claiming heavy losses as its reason for raising ticket prices with astonishing anomalies or the matter of increasing price of your daily commodity, milk. Cost accountants explain the reasons for price increase and can make it amply clear whether you are charged much or duped by a product manufacturer. The costing of MRP or the product cost has to be fixed through some genuine standardized processes or procedures. We are the one who do cost and management accounting, financial accounting, MIS, internal audit, taxation, cost audit, valuation, compliance, etc. to serve industry and consumers in the interest of the nation. The advent of excise audit, VAT audit, concurrent audit, borrowers accounts for banks, etc. has further opened up the scope of cost accountants in practice. However service industries like banking, insurance, health services, media, broadcasting, entertainment, education, hospitality, tourism, airlines, etc. are yet to witness benefit of cost and management accountancy.

Cost accountants not only give correctional price to consumers but also competitive edge and operational efficiency to industry, locally as well as globally. It is an established fact that cost audit can provide relevant reports to the board of directors to strengthen its oversight function. But the greatest problem is that the profession has not received the required legislative support to look into strategic problems of economy, cost cutting, price management, taxation, etc. on a larger scale in general. Dwarfed by the myopic vision of the authorities and non-competitive attitude of the industry, we have been provided with 44 industries spanning from sugar, paper, refrigerators, cement, steel, electronics products, plantation products, etc. in a discriminatory pick and choose method. We are allowed to work within the limited scope of sections 209(1)(d) for statutory cost accounting in selected industries and 233 (B) for mandatory cost audit of companies as and when ordered by the government under the purview of the Companies Act, 1956.