Where goods are consumed captively or transferred between related units or distinct persons, value is often determined by reference to the cost of production. CAS-4 sets out how that cost is measured, and certificates prepared under it are commonly relied upon by taxpayers and departments.
Scope of service
- Cost of production computed under CAS-4
- Captive consumption and inter-unit transfers
- Valuation support under rule 30 of the CGST Rules (110% of cost of production)
- Annual and periodic certificates
Regulatory framework
- Cost Accounting Standard 4 (Cost of Production for Captive Consumption)
- CGST Rules, 2017 — Rules 28 and 30
- Companies (Cost Records and Audit) Rules, 2014, where records are maintained
Typical professional activities
- Review of cost records and production data
- Computation under CAS-4
- Issue of certificate with UDIN
Applicable industries
Relevant articles and resources
- CAS-2: capacity determination and the cost of idle capacity
- CAS-4: cost of production for captive consumption
- CAS-6: measuring material cost
- CAS-7: employee cost in product costing
- Knowledge Centre: Cost Accounting
Frequently asked questions
What is a CAS-4 certificate?
It certifies the cost of production of goods computed under Cost Accounting Standard 4, issued by a Cost Accountant in practice. It is commonly used for captive consumption, inter-unit transfers and GST valuation.
How is GST valued on supplies between related units?
Rule 28 of the CGST Rules applies open market value first. Where that and the value of like goods are not available, rule 30 values the supply at 110% of the cost of production or manufacture.
The information on this page describes the nature of the service. It is not advice on any specific matter. See the disclaimer.