Nepal is currently undertaking a transition to Nepal Financial Reporting Standards (NFRS), which are converged with IFRS.  Listed multi-national companies will report using NFRS for the first time for financial reporting periods beginning on 15 July 2014.  Financial institutions, state-owned corporations and other listed companies will transition over the following two years.

The IFRS Center of Excellence in Nepal was established by agreement between the ASB and AOSSG as a two year pilot project and may lead to the establishment of further IFRS Centers of Excellence in other developing jurisdictions within the Asian-Oceanian region.

The review of the pilot project was undertaken by the AOSSG 'IFRS CoE for a Developing Country Working Party', and included benchmarking against A Model for National Standard-Setters developed by the International Forum of Accounting Standard Setters (IFASS).

The working party's report considers the statutory framework for accounting in Nepal, the governance of the ASB, ASB board membership and characteristics, resources, due process, board meetings. communication with constituents, and relationships with key stakeholders.

The key recommendations the report makes include:

• The ASB needs to develop technical skills and knowledge appropriate to the jurisdiction, including hiring additional full-time staff, developing a business plan with key strategies, and identifying planned activities under each strategic initiative
• The ASB should develop a strategic plan, as a subset of its business plan, that identifies the IFRS technical projects and the IFRS adoption plan that the ASB is pursuing, including plans to raise the awareness of IFRS adoption in Nepal and initiatives to discharge its accountability to stakeholders in financial reporting
• A strategic plan for greater funding needs to be developed as part of the business plan and executed with the Nepal Government and donor agencies
• The ASB should align its due processes as closely as possible with the timing by the IASB to enable the views of Nepal stakeholders to be heard before the IASB proposals are finalised to ensure IFRS compliance is maintained in Nepal
• A board member appointment policy document, including preferred skills and experience for ASB members, should be formulated and provided to the Nepal Government and the Institute of Chartered Accountants of Nepal (ICAN) to assist them in nominating and appointing ASB members.

The report is available on the AOSSG website.