Release of Exposure Draft Cost Accounting Standard (CAS – 2) on Capacity Determination (Revised – 2023)

Dear Professional Colleagues,

Greetings from the CASB of ICMAI;

The Cost Accounting Standard (CAS-2) on Capacity Determination explains various concepts pertaining to Capacity by giving definitions and listing out logic for calculation of capacities such as Normal Capacity, Installed Capacity etc. There were inconsistencies in the definition & calculation logic of certain concepts like definition of Normal Capacity & its formula for Determination as explained in the standard. The flow of Capacity from Installed to Actual was not explained in totality and there were missing concepts that need to be explained.

The Cost Accounting Standards Board (CASB), the standard-setting body of the Institute, in its 100th meeting held on 5th September 2023 considered the required modifications in the existing CAS-2 and suitably incorporated the same into the revised draft. These modifications are highlighted in RED colour font.

The CASB has approved the release of Exposure Draft of the Cost Accounting Standard on Capacity Determination (CAS-2, Revised 2023) seeking public comments / suggestions within 16th October 2023. The revised standard shall be finalised by the Board in the light of the suggestions / comments received within the prescribed last date.

Please submit your suggestions / comments in the format given hereunder through email at casb@icmai.in

To download the Exposure Draft, please click here

With Best Regards,
CMA Neeraj D Joshi
Chairman, CASB
15th September 2023