Asian-Oceanian Standard-Setters Group (AOSSG)

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AOSSG’s Building Regional Capacity Initiative


The AOSSG’s IFRS Centre of Excellence (COE) for a Developing Country Working Party has accomplished its targeted activities after two years for establishing a pilot IFRS Centre of Excellence (COE) initiative in Nepal.

A review of the standard-setting processes and capacity of the Accounting Standards Board, Nepal (ASB)

The aims of the review have been to identify the challenges faced by the ASB in undertaking its standard-setting responsibilities and identify areas in which improvements could be made to the ASB’s standard-setting processes and capacity.

Two staff members, Christina Ng from the Australian Accounting Standards Board (AASB) and Winnie Chan from the Hong Kong Institute of Certified Public Accountants, conducted the review to understand the composition and selection of members, the available resources, due process, accountability and other reporting obligations of the ASB. Staff met key stakeholders, including representatives from the Ministry of Finance of Nepal, Securities Board of Nepal, Insurance Board, and Nepal Rastra Bank (central bank), and members of the ASB.

The AOSSG’s Report on Standard-Setting Capacity in Nepal, published in early July 2014, outlines the observations from the review and provides recommendations based on the experience of other AOSSG members that may help develop further the ASB’s standard-setting capacity.

The Report highlights the Working Party’s recommended high priorities that the ASB should consider undertaking to improve its standard-setting capacity. The first recommendation is to appoint some technically skilled staff who can support the work undertaken by the ASB. To-date, that support has been provided on a voluntary basis by domestic accounting practitioners and some of its part-time board members.

Other high priority recommendations that the ASB could implement within existing means are outlined in the Working Party’s Report.

The analysis of the challenges and needs of the ASB, as well as standard-setting areas in which the ASB could improve, have been communicated to the Nepal Government and the World Bank.

A series of Train-the-Trainer (TTT) programs in Kathmandu

The aims of the TTT program have been to deliver IFRS training to ASB members and selected other people to provide the ASB with the capacity to understand, apply and further explain IFRS to its constituents, particularly in the absence of technical staff members. It is viewed that an IFRS-trained board would improve the ASB’s capacity to respond to IFRS consultation requests of the IASB, IFRS Interpretations Committee, AOSSG and other national standard-setters. These programs were funded by the member organisations that provided the trainers and by the ASB.

The first TTT program was held over three days in June 2013 and covered topics related to financial statements presentation, revenue recognition and measurement including from the perspective of construction contracts, and non-derivative financial instruments recognition and measurement. The first TTT program involved six trainers provided by member organisations: AASB, the Institute of Chartered Accountants of India (ICAI), Korea Accounting Standards Board (KASB) and Malaysian Accounting Standards Board.

AOSSG trainers from left to right: Ajit Viswanath, Christine Lau, Kar Wai Siew, Christina Ng, Anand Banka, Sung-Ho Joo
AOSSG trainers from left to right: Ajit Viswanath, Christine Lau, Kar Wai Siew, Christina Ng, Anand Banka, Sung-Ho Joo

The second TTT program was held in November 2014 over three days and covered topics related to fair value measurement, provisions and contingent liabilities, group and reporting entity related issues, non-current assets held for disposal and foreign currency translation. The second TTT program involved five trainers provided by member organisations: AASB, ICAI and KASB.

Kevin Stevenson, ex-Chairman of the AASB who was among the second TTT program trainers, commented, “I was very impressed by the diligence of the 18 ‘trainee’ trainers who stuck at quite an intensive and interactive program for three long days. The AOSSG is very indebted to the trainers who volunteered their time to deliver the training sessions and who I thought were all excellent. Knowing many of the key professionals in Kathmandu, I can confirm we had a very influential selection of potential trainers with whom to work.

To me the training capped off a successful pilot IFRS COE. The ASB is much better connected with other standard-setters around and beyond the region, including with the IASB. It has sorted out procedural matters such as IFRS copyright, has had the benefit of the AOSSG review of its standard-setting processes, has seen AOSSG and IASB’s work to reinforce the ASB's promotion of IFRS with ASB stakeholders, and has enjoyed the training program for its trainers. Above all of these good things, Nepal is transitioning to IFRS!”

AOSSG trainers from left to right: Sung-Ho Joo, Anand Banka, Woung-Hee Lee, Christina Ng, Ajit Viswanath, Kevin Stevenson
AOSSG trainers from left to right: Sung-Ho Joo, Anand Banka, Woung-Hee Lee, Christina Ng, Ajit Viswanath, Kevin Stevenson

The AOSSG Working Party, comprising member organisations from Australia, China, Hong Kong, India, Indonesia, Iraq, Japan, Korea, Malaysia, Nepal and Pakistan, will continue to monitor the progress of IFRS adoption in Nepal and will continue to mentor the ASB on standard-setting matters where necessary.

The Working Party will also assess whether further IFRS COEs in its member jurisdictions that can be characterised as ‘developing’ would be feasible and necessary following an assessment of the pilot initiative in Nepal.