In simple words the term cost audit means a systematic and accurate verification of the cost accounts and records and checking of adherence to the objectives of the cost accounting. As per ICWA London “ cost audit is the verification of the correctness of cost accounts and of the adherence to the cost accounting plan.” [...]

The basic nature of audit is checking and it holds good for both the cost audit as well as the financial audit. However following are the points of difference between these two audits: 1. Compulsory nature – Financial audit is compulsory for all the companies registered under companies act, 1956. Cost audit is not compulsory [...]