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  Overheads

Introduction to Overheads cost audit program

The Cost Auditor will see and certify, inter alia:

(a) That allocation of indirect expenditure over production, sales and allotment is logical and correct;

(b) That compared along with the volume of production in a production shop, the overhead charges are not excessive;

(c) That the actual indirect expenditure does not go beyond budgets or standard expenditure considerably and that any variations are satisfactorily described and accounted for.

(d) That allocation of overheads among unfinished and finished production is in accordance with accurate costing principles. It may be noticed that foregoing programme determines, generally, applicability of Cost Audit Functions to specific areas of production. The cost auditor might have to make addition enquiries or perform such examination as might be necessitated though the conditions.

 

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