Financial Crime World

Here is the converted article in Markdown format:

Nepal Adopts International Standards in Professional Accountancy

Kathmandu, Nepal - The Institute of Chartered Accountants of Nepal (ICAN) has made significant progress in adopting international standards in professional accountancy, according to a recent report.

ICAN’s Responsibilities and Achievements

Under the Nepal Chartered Accountants Act 1997, as amended in 2004, ICAN is responsible for establishing and maintaining professional accounting standards in the country. The organization has adopted several international standards, including:

  • International Education Standards (IES)
  • International Standards on Auditing (ISA)
  • Code of Ethics for Professional Accountants

ICAN has also established an investigation and disciplinary system for professional accountants in Nepal, which includes a Disciplinary Committee and Monitoring Committee responsible for enforcing compliance with technical and professional standards.

Development of Financial Reporting Standards

ICAN has developed the Nepal Financial Reporting Standards (NFRS) in line with International Financial Reporting Standards (IFRS). Listed companies, state-owned enterprises, commercial banks, and other financial institutions must apply NFRS. Other companies may use:

  • Nepal Accounting Standards (NAS)
  • NFRS for SMEs
  • NAS for NPOs

Recognition by the World Bank

The report highlights that ICAN has conducted a self-assessment of its investigation and disciplinary system against the requirements of SMO 6 and reported alignment. The organization has also established a Disciplinary Division to support the Disciplinary Committee.

ICAN’s efforts to adopt international standards have been recognized by the World Bank, which praised the country’s progress in implementing accounting and auditing standards in its Report on the Observance of Standards and Codes (ROSC) 2015.

Conclusion

While there is still some way to go, ICAN’s adoption of international standards demonstrates a commitment to maintaining high-quality professional accountancy practices in Nepal. The organization continues to work towards aligning with global accounting standards.

Sources:

  • ICAN, SMO Action Plan, 2023
  • IFRS Foundation, “IFRS Application Around the World, Jurisdictional Profile: Nepal,” 2016
  • Institute of Chartered Accountants of Nepal, “Nepal Financial Reporting Standards”
  • World Bank, Report on the Observance of Standards and Codes (ROSC), Accounting and Auditing: Nepal, 2015

Disclaimer: IFAC bears no responsibility for the information provided in the SMO Action Plans prepared by IFAC member organizations. Please see our full Disclaimer for additional information.