Office of Chief Adviser Cost

  • The Office of Chief Adviser Cost (CAC) is one of the divisions functioning in the Department of Expenditure, Ministry of Finance. This office advises the Ministries and Government Undertakings on cost accounts matters and undertakes cost investigation work on their behalf. It is a professional agency staffed by Cost Accountants/ Chartered Accountants.

  • The office of Chief Adviser Cost is dealing with matters relating to costing and pricing, studies for determining fair prices, studies on user charges, cost-benefit analysis of projects, studies on cost reduction, cost efficiency, appraisal of capital intensive projects, profitability analysis and application of modern management tools evolving cost and commercial financial accounting for Ministries/Departments of Government of India.

  • It was set up as an independent agency of the Central Government to verify the cost of production and to determine the fair selling price for the Government Departments including Defence purchases in respect of the cases referred to. The role of the office was further enlarged and extended to fixing prices for a number of products covered under the Essential Commodities Act, such as, Petroleum, Steel, Coal, Cement, etc. under the Administered Price Mechanism (APM). Since cost/ pricing work in the Ministries increased significantly, various other Ministries/ Departments started to have their in house expertise by seeking posting of service officers for work requiring expertise in cost/ commercial accounts matters. In the post-liberalization era, the office is receiving and conducting studies in synchronization with liberalization policy of the Government in addition to the traditional areas of cost-price studies.

  • The Chief Adviser Cost’s Office is also cadre controlling office for the Indian Cost Accounts Service (ICoAS) and looks after training requirements of the officers for continuous up-gradation of their knowledge and skills, in addition to rendering professional guidance to the ICoAS officers working in different participating organizations.

  • The major areas of professional functions of the office of the Chief Adviser Cost are as under:
    i. Assisting Central Government Ministries/ Departments/ Organizations in solving complex Price / Cost related issues, in fixing fair prices for various services/products and rendering advice to various Ministries/Departments in cost matters.
    ii. Examination/ Verification of claims between Government Departments / Public Sector undertakings and suppliers arising out of purchase contracts.
    iii. Determining prices of products and services supplied to Government, to enable Government Departments to negotiate prices with the supplying organizations.
    iv. Conducting studies for determining cost/ fair prices and making recommendations for fair prices/ rates for products and services and also to determine reasonableness of prices charged, duty structure, etc.
    v. Valuation of assets and liabilities of business taken over and shares of public sector undertakings.
    vi. Functioning as Chairman/ Members of Committees constituted by Government/ different Departments related to Cost/financial and pricing matters.
    vii. Conducting cost and performance audit of industrial undertakings.
    viii. Subsidy determination and verification of claims under Market Intervention Schemes (MIS) and Price Support Schemes (PSS) for sharing of losses by State and Central Government.
    ix Developing Cost Accounting System for departmental undertakings/Autonomous bodies.
    x. Conducting Time and Cost Overruns of major projects.

  • e-Governance activities
    a) e-Office software is being implemented across all the Divisions of the Department of Expenditure( DoE) in a phased manner, the Office of Chief Adviser Cost being one of divisions under DoE is also taking necessary action in this regard. Online e-Office APAR system (SPARROW) in respect of ICoAS officers will be implemented from the assessment year 2017-18. Further, this office has also become part of the e-Office Premium software being implemented in DoE.
    b) The existing website www.cac.gov.in of the office of Chief Adviser Cost is also proposed to be revamped based on latest guidelines of GoI including RTI requirements.

    For further information please visit http://cac.gov.in