With the objective of promoting and regulating the accounting profession in Nepal, The Institute of Chartered Accountants of Nepal (ICAN) was established under The Nepal Chartered Accountants Act, 1997. The Act empowers ICAN to establish standards for accounting, auditing, and other related services, and regulate the professional conduct of its members. Additionally, the Institute is responsible for raising awareness about the significance of accounting and its contribution to economic development in Nepal. ICAN operates autonomously and is accountable for enforcing the highest professional standards among its members.
History of ICAN
In 1934, Nepal legislated its first Companies Act, which was later updated in 1956 to specify requirements for maintaining books of accounts and having them audited by a licensed auditor from the Department of Industries. In 1974, the Auditors' Act was legislated, giving the Office of Auditor General (OAG) the authority to issue auditor licenses and set qualification standards for auditors. Chartered Accountants with five years of experience were granted a Class A license with unlimited authority to audit any organization, while others were given Class B, C, or D licenses depending on their education and experience. The Auditor General was given disciplinary powers and received recommendations from a Disciplinary Committee.
In 1978, the Association of Chartered Accountants of Nepal (ACAN) was formed as a voluntary social organization, and it applied for registration under the Societies Registration Act. ACAN was officially registered in 1982 and inaugurated by the Minister of Finance. In 1985, the South Asian Federation of Accountants (SAFA) formed a committee to assist ACAN in recommending the formation of an accounting body in Nepal. This resulted in a high-level study group being formed by the government in 1988 to recommend the formation of an autonomous self-regulatory accounting body in Nepal.
In 1990, ACAN held a SAFA international seminar that was inaugurated by the Prime Minister, who committed to the formation of an accounting body in Nepal, uplifting the profession's image. The Nepal Chartered Accountants Act, 1997 was then enacted, receiving the royal seal on January 30, 1997, and establishing the Institute of Chartered Accountants of Nepal (ICAN). ICAN has two classes of members: Chartered Accountants and Registered Auditors, and the Auditors' Act was repealed upon notification in the Official Gazette. All Registered Auditors holding audit licenses were invited to apply for ICAN membership, and the first council was formed on August 1, 1997. ICAN became a member of SAFA, and a new Companies Act was enacted with revised provisions on accounting and auditing.
In 1974, the Auditors' Act was legislated, which set qualification standards and issued auditor's licenses in four different classes of Registered Auditors. Chartered Accountants with five years of experience were given Class A licenses with unlimited authority to audit any organization.
In 1978, the Association of Chartered Accountants of Nepal (ACAN) was formed as a voluntary social organization, and in 1982, it was registered under the Societies Registration Act. In 1990, ACAN held a South Asian Federation of Accountants (SAFA) international seminar, which was inaugurated by the Prime Minister who committed to the formation of an accounting body in Nepal.
In 1997, the Nepal Chartered Accountants Act, 1997 received the royal seal, and the Institute of Chartered Accountants of Nepal (ICAN) was established. ICAN replaced the Auditors' Act and had two classes of members: Chartered Accountants and Registered Auditors.
ICAN's primary function is to regulate the accounting profession in Nepal and enhance public trust in the profession by raising awareness of the economic and social responsibilities of accountants. It is an autonomous body fully authorized by the Act to regulate the accountancy profession in Nepal.
ICAN offers professional development programs, such as continuing professional development (CPD) courses, seminars, and conferences, to improve the skills and knowledge of its members. It conducts the Chartered Accountancy (CA) examination, and successful candidates are awarded the CA designation.
ICAN is a member of international accounting organizations, such as the International Federation of Accountants (IFAC), the Confederation of Asian and Pacific Accountants (CAPA), and the South Asian Federation of Accountants (SAFA). ICAN has signed mutual recognition agreements (MRAs) and memoranda of understanding (MOUs) with accounting bodies in various countries, such as Australia, India, Sri Lanka, and the United Kingdom.
ICAN has made significant progress in regulating the accounting profession in Nepal and improving the skills and knowledge of its members. Some of its notable achievements include:
- In 2003, ICAN became an associate member of IFAC, which is a global organization for the accountancy profession.
- In 2008, ICAN became a full member of IFAC, which is a testament to its commitment to upholding the highest professional standards.
- In 2014, ICAN inaugurated its building, which was opened by the President of Nepal.
- In 2018, ICAN opened its first international chapter in Australia, which shows its growing presence and influence beyond Nepal.
- In 2020, ICAN signed an MRA with the Institute of Chartered Accountants of India, which recognizes the qualifications of each other's members and facilitates their mobility across borders.
Objectives of ICAN
- To serve as a regulatory body that encourages its members to adhere to the code of conduct, with the aim of strengthening and advancing the field of accountancy for the economic development of the country.
- To increase public awareness and confidence in the accounting profession by educating the public on the importance of accountancy and the social and economic responsibilities of accountants.
- To foster the development, protection, and promotion of the accountancy profession by promoting a greater understanding among accountants of their responsibilities and the importance of the accounting function.
- To establish registration and qualification standards for accountants, as well as an examination system that is in line with international norms and best practices, with the goal of enhancing the credibility and reliability of the accounting profession.
To be a leading global professional accounting body.
To produce world-class Chartered Accountants, regulate and continuously enhance their ethical standards and technical competence in the public interest.
ICAN's core values are:
- Professionalism: Upholding high ethical standards and competence in the discharge of professional responsibilities.
- Integrity: Acting honestly, transparently, and consistently in all professional activities.
- Accountability: Accepting responsibility and being answerable for actions and decisions.
- Innovation: Encouraging creativity, continuous learning, and development of new ideas.
- Excellence: Striving for the highest quality in all professional activities.
- Collaboration: Working together and building partnerships to achieve common goals.
- Customer Focus: Providing services that meet the needs of stakeholders and customers.
These values help guide ICAN's members and staff in their day-to-day activities and ensure that they uphold the highest standards of professionalism, integrity, and excellence in their work.
Overall, ICAN has played a crucial role in enhancing public trust in the accounting profession in Nepal and promoting the economic development of the country. Its achievements demonstrate its commitment to upholding the highest professional standards and providing its members with opportunities for professional growth and development.
The Institute of Chartered Accountants of Nepal
(Established under The Nepal Chartered Accountants Act, 1997)
ICAN Marg, Satdobato, Lalitpur, Post Box No.: 5289
Tel: 00977- 1- 5530730, 5530832,
Fax: 00977- 15550774
Email: [email protected]