Advanced Financial Reporting
NAS 2 — Inventories
Inventories under NAS 2 — cost, net realisable value, FIFO vs weighted average, write-downs and reversals, with a full worked example.
Read the note →
ICAN • CA Final • Nepal Financial Reporting Standards
NFRS 1 — First-time Adoption of Nepal Financial Reporting Standards
The complete, student-friendly guide: how a company moves from Previous GAAP to NFRS for the very first time — opening balance sheet, transition date, exemptions, exceptions, reconciliations, and fully worked Nepali examples. Nothing important left out.
Based on NFRS 1 (converged with IFRS 1), issued under the Accounting Standards Board (ASB) Nepal & adopted by ICAN. Always cross-check the latest ICAN pronouncements & carve-outs for your exam / reporting year.
At a glance — if you remember only 5 things
- One date controls everything: Date of Transition
- Prepare an Opening NFRS Statement of Financial Position on that date
- Apply NFRS retrospectively — as if NFRS had always applied
- Unless: a Mandatory Exception forbids it, or an Optional Exemption relieves you
- Explain the move: Reconcile equity & profit from Previous GAAP → NFRS
4Appendices A–D
7+Mandatory exceptions
19Optional exemptions
3Reconciliations required
Chapter 1 • Context
Why did Nepal move to NFRS?
Before NFRS, Nepali companies followed Nepal Accounting Standards (NAS) / Previous GAAP — largely rule-based, with limited fair value, disclosure, and financial-instrument guidance. NFRS brought Nepal in line with global IFRS.
🌍 Comparability
Investors, banks and foreign partners can compare a Nepali company with companies in India, Europe or Singapore using the same language.
🔎 Transparency
Fair value, expected credit losses, substance over form, and extensive disclosures reveal risks that historical-cost NAS often hid.
🏦 Access to capital
Listed companies, BFIs and large corporates need credible statements for NEPSE, NRB, SEBON, lenders and cross-border investment.
Nepal’s phased adoption — the big picture
ICAN, on ASB Nepal’s standards, rolled NFRS out in phases — financial institutions and listed / large entities first, then other corporates, with NFRS for SMEs and NAS for NPOs / Micro entities for smaller entities. Exact applicability depends on the entity type, listing status, and ICAN notices for that fiscal year (with certain carve-outs / carve-ins notified for Nepal).
Figure 1 — Concept map of Nepal’s phased approach. The applicable framework depends on entity size & public accountability — not choice alone.
Exam note: NFRS 1 applies only when an entity moves to full NFRS. Moving to NFRS for SMEs, or moving within NFRS (e.g., a policy change), is not first-time adoption under NFRS 1.
Chapter 2 • Objective & Scope
Objective: ensure the first NFRS statements are a clean, comparable starting point
NFRS 1’s objective is to ensure an entity’s first NFRS financial statements (and any interim reports for part of that period) contain high-quality information that is:
- Transparent and comparable over all periods presented
- Provides a suitable starting point for NFRS accounting
- Can be generated at a cost that does not exceed the benefits
- Explains how the transition affected financial position, performance & cash flows
Scope — when does NFRS 1 apply?
| Applies ✓ | Does NOT apply ✕ |
|---|---|
| First financial statements in which the entity makes an explicit and unreserved statement of compliance with NFRS | Entity already reporting under NFRS and just changes a policy (→ NFRS 8 / NAS 8) |
| Previous GAAP was NAS / another GAAP, or statements contained a reconciled / partial NFRS compliance statement | Entity stops using NFRS and later resumes — generally not a new first-time adoption (see §11) |
| Entity did not present financial statements in previous periods at all, but now adopts NFRS | Adoption of NFRS for SMEs alone (separate standard, Section 35 of that standard) |
The trigger phrase to spot in exams: “explicit and unreserved statement of compliance with NFRS” in the auditor’s report / notes. Without it, the statements are not yet “first NFRS financial statements”, even if some NFRS numbers were used internally.
Chapter 3 • Appendix A — Defined Terms
Key definitions you must not mix up
| Term | Meaning in plain English |
|---|---|
| Date of Transition | Beginning of the earliest period for which full comparative information under NFRS is presented in the first NFRS statements. |
| First NFRS Financial Statements | First annual statements with explicit & unreserved NFRS compliance statement. |
| First NFRS Reporting Period | Latest period covered by those first NFRS statements (e.g., FY 2080/81). |
| First-time Adopter | Entity presenting its first NFRS financial statements. |
| Previous GAAP | Basis used immediately before NFRS — for most Nepali companies, NAS / Companies Act basis. |
| Opening NFRS SFP | Statement of Financial Position at the Date of Transition. |
| Deemed Cost | A surrogate for cost / depreciated cost at a given date — e.g., fair value at transition used as the new “cost” going forward. |
| Fair Value (NFRS 13) | Price to sell an asset / transfer a liability in an orderly transaction between market participants at measurement date. |
| Reporting Date | End of the latest period covered by the statements (balance-sheet date). |
Chapter 4 • The Heart of NFRS 1
The general rule: retrospective application
OPENING NFRS SFP at Date of Transition
= Recognise ALL assets & liabilities NFRS requires
+ Derecognise items NFRS does NOT permit
+ Reclassify items classified differently under Previous GAAP
+ Measure EVERYTHING under NFRS principles
= Recognise ALL assets & liabilities NFRS requires
+ Derecognise items NFRS does NOT permit
+ Reclassify items classified differently under Previous GAAP
+ Measure EVERYTHING under NFRS principles
All adjustments → Retained Earnings (or another equity category, if NFRS requires) at transition
The 4 steps — do them in this order, every time
Figure 2 — The 4-step opening balance sheet process (NFRS 1, Para 7–11).
Examples of RECOGNISE
Derivative financial instruments, deferred tax on all temporary differences (NAS 12 / NFRS), defined-benefit obligation, expected credit loss allowance, decommissioning provision.
Examples of DERECOGNISE
Deferred R&D / preliminary expenses capitalised under Previous GAAP but failing NFRS 38 criteria, general provisions not meeting NAS 37, proposed dividend recognised as liability before approval.
Examples of RECLASSIFY
Minority interest → Non-controlling interest within equity; redeemable preference shares → liability if NFRS 32 requires; investment property separated from PPE.
Where do adjustments go?
Directly in retained earnings at transition — NOT through profit or loss of the transition year. Only if a standard requires another reserve (e.g., revaluation surplus, FVOCI reserve) is that used.
Common trap: The opening NFRS SFP does not need to be published as a primary statement in all cases, but NFRS 1 requires a third SFP at transition when retrospective adjustments materially affect it (per NAS 1). The numbers behind it must always be prepared and reconciled.
Chapter 5 • Dates — Most Tested, Most Confused
Transition timeline — worked with Nepali fiscal years
Suppose Himalayan Tiles Ltd presents its first NFRS statements for FY 2080/81 (year ended 31 Ashadh 2081 / 15 July 2024) with one year of comparatives.
1 Shrawan 2079 • 17 July 2022Date of Transition
Opening NFRS SFP is prepared here. Start of earliest comparative period.
FY 2079/80 • Comparative YearRestate under NFRS
Previous GAAP FY 2079/80 numbers are restated to NFRS for comparison.
31 Ashadh 2081 • 15 July 2024Reporting Date
First NFRS Reporting Period ends. First NFRS statements published.
Figure 3 — If comparatives were 2 years, transition would shift one year earlier. Transition date always = start of earliest comparative period presented.
| Question | Answer |
|---|---|
| Which NFRS version applies at transition? | The NFRS in force at the reporting date (end of first NFRS period), applied throughout all periods presented — subject to exceptions/exemptions. |
| Can a company choose an earlier transition date voluntarily? | Only by presenting more comparatives. The date is determined by the comparatives presented, not free choice. |
| What about interim reports in the first NFRS year? | If an interim report (e.g., Q2) is presented under NAS 34, it must also comply with NFRS 1 disclosure & reconciliation rules for that interim period. |
Chapter 6 • Accounting Policies & Estimates
Same policies for every period. Estimates: no hindsight.
📘 Accounting Policies (Para 7)
Use the same NFRS accounting policies in the opening SFP and throughout all periods in the first NFRS statements. Those policies must comply with each NFRS effective at the reporting date.
Early adoption: A new NFRS not yet mandatory may be applied early if that NFRS permits it.
🎯 Estimates (Para 14–17) — Mandatory Exception in effect
Estimates at transition under NFRS must be consistent with estimates made under Previous GAAP for the same date — unless there is objective evidence the old estimate was in error.
No hindsight: you cannot use information that arose after transition to create an estimate that didn’t exist then. Adjust only for differences in accounting policies.
Example — No hindsight: At 1 Shrawan 2079 a debtor owed Rs. 10 lakh and was paying normally. He went bankrupt in Bhadra 2079. In the opening SFP you do NOT provide 100% ECL using that later knowledge — unless bankruptcy showed a condition already existing at transition. You do, however, apply NFRS 9’s ECL method using information available at transition.
Transitional provisions in other standards
If another NFRS contains its own transitional provisions for existing adopters, those do not override NFRS 1 for a first-time adopter — NFRS 1 governs, except where NFRS 1 itself says otherwise.
Chapter 7 • Appendix B — Mandatory Exceptions
Exceptions: where retrospective application is FORBIDDEN
These are not choices. NFRS prohibits retrospective application here because it would require hindsight or would be impracticable / misleading.
| Exception | Rule | Why / Simple Example |
|---|---|---|
| 1. Estimates | As in §6 — consistent with Previous GAAP unless error. | Prevents rewriting history with later knowledge. |
| 2. Derecognition of Financial Assets / Liabilities (NFRS 9) | Apply derecognition prospectively from transition. Assets derecognised under Previous GAAP before transition stay off-balance-sheet (unless entity elects retrospective if info was available at the time). | Ex: Loans sold in 2078 & derecognised under NAS stay derecognised. |
| 3. Hedge Accounting (NFRS 9) | No retrospective hedge designation. Only hedges meeting NFRS 9 criteria at transition can be hedge-accounted going forward. Previous GAAP hedges that don’t qualify are discontinued. | Prevents cherry-picking hedges after seeing results. |
| 4. Non-controlling Interests (NFRS 10) | Certain requirements apply prospectively: attribution of TCI, changes in ownership without loss of control, loss of control accounting. | Past NCI transactions are not restated. |
| 5. Classification & Measurement of Financial Assets (NFRS 9) | Assess business model & SPPI on facts at transition date. If impracticable to assess modified time-value / prepayment elements retrospectively, use transition-date assessment. | Classification is based on how assets are managed at transition. |
| 6. Impairment — ECL (NFRS 9) | Use reasonable & supportable info available without undue cost/effort at transition to determine credit risk at initial recognition & whether it has increased significantly. | If determining original credit risk is impossible without undue effort, treat as low / lifetime considerations per NFRS 1 guidance. |
| 7. Embedded Derivatives | Assess whether separation is required based on conditions at the later of: when the entity became party to the contract, or transition / re-assessment event date. | Avoids re-analysing old contracts with hindsight. |
| 8. Government Loans (NAS 20) | Prospective application for below-market government loans. Previous GAAP carrying amount at transition becomes opening carrying amount; do not restate benefit retrospectively unless info was available then. | Ex: Subsidised NRB refinance loan. |
Memory hook — Exceptions = “EDH-NCI-CIEG”: Estimates, Derecognition, Hedge, NCI, Classification, Impairment, Embedded derivatives, Government loans. If a question says “must restate retrospectively” for one of these — it’s wrong.
Chapter 8 • Appendices C & D — Optional Exemptions
Exemptions: where you MAY choose relief from full retrospective restatement
Exemptions save cost where retrospective work would be huge and benefit small. You may elect some, all, or none — individually. Once elected and first statements are published, you generally cannot reverse the choice for that item.
| Exemption | What relief you get | Category |
|---|---|---|
| 1. Business Combinations (App. C) ★ | Need not restate combinations before transition under NFRS 3. Previous GAAP classification & carrying amounts largely kept (with limited adjustments: recognise NFRS-required items, derecognise non-qualifying intangibles, test goodwill for impairment at transition). If you restate one, you must restate all later combinations. | Group |
| 2. Deemed Cost — PPE, Investment Property, Intangibles ★ | Measure at fair value at transition and use that as deemed cost, OR use a Previous GAAP revaluation broadly comparable to fair value / NFRS cost as deemed cost. Election is item-by-item. | PPE |
| 3. Deemed Cost — Oil & Gas / Rate-regulated | Special deemed-cost relief for exploration assets and rate-regulated activities using Previous GAAP amounts. | PPE |
| 4. Cumulative Translation Differences ★ | Deem cumulative translation differences for all foreign operations to be zero at transition. Gain/loss on later disposal excludes pre-transition translation differences. | Group |
| 5. Employee Benefits ★ | Recognise all cumulative actuarial gains/losses at transition in retained earnings, even if corridor approach was used under Previous GAAP. | Other |
| 6. Investments in Subsidiaries / JVs / Associates (Separate FS) | Measure at cost (per NAS 27), deemed cost (fair value or Previous GAAP carrying amount), or per NFRS 9. | Group |
| 7. Assets & Liabilities of Subsidiaries adopted later than Parent | If subsidiary adopts NFRS after parent, it measures assets/liabilities at either (a) carrying amounts in parent’s consolidated FS, or (b) amounts based on subsidiary’s own transition date — choice applies to all its assets/liabilities. | Group |
| 8. Compound Financial Instruments | If liability component is no longer outstanding at transition, need not split equity component retrospectively. | Financial |
| 9. Designation of Previously Recognised Financial Instruments ★ | At transition, may designate a financial asset as FVPL / FVOCI or liability as FVPL if NFRS 9 criteria met at transition, overriding original classification. | Financial |
| 10. Fair Value at Initial Recognition (Day-1) | Apply NFRS 9 / NFRS 13 day-1 gain/loss rules prospectively to transactions after transition (or a chosen earlier date). | Financial |
| 11. Decommissioning Liabilities in PPE Cost | Instead of full retrospective: measure liability at transition (NAS 37), estimate amount to include in asset cost by discounting back, calculate accumulated depreciation on that basis. | PPE |
| 12. Financial Assets — Service Concession (IFRIC 12) | If impracticable, use Previous GAAP carrying amounts of concession financial / intangible assets as opening amounts. | Financial |
| 13. Borrowing Costs (NAS 23) | Apply NAS 23 prospectively from transition (or earlier elected date); need not restate borrowing costs capitalised under Previous GAAP. | PPE |
| 14. Share-based Payments (NFRS 2) | Need not apply NFRS 2 to equity instruments granted on/before the NFRS 2 effective cut-off and vested before transition, or liabilities settled before transition. Encouraged, not required, for others if fair value was publicly disclosed. | Other |
| 15. Leases (NFRS 16) ★ | Assess whether an arrangement contains a lease based on facts at transition; lessee may measure lease liability at present value of remaining payments & ROU asset at liability amount (or retrospectively), use hindsight for lease term, exclude initial direct costs, use single discount rate for similar leases, etc. | Other |
| 16. Extinguishing Liabilities with Equity (IFRIC 19) | Apply prospectively from transition. | Financial |
| 17. Severe Hyperinflation | If functional currency was severely hyperinflationary before transition, measure assets/liabilities at fair value at transition as deemed cost. (Rarely relevant for NPR.) | Other |
| 18. Joint Arrangements (NFRS 11) | Transitional relief when moving from proportionate consolidation to equity method (and vice-versa) — test the aggregate investment for impairment at transition. | Group |
| 19. Stripping Costs — Surface Mining (IFRIC 20) & Insurance Contracts (NFRS 17) | Stripping: apply to production stripping asset based on predecessor asset. Insurance: specific NFRS 17 transition exemptions for first-time adopters (classification / measurement reliefs). | Other |
Deemed Cost — Numerical mini-example:
Machine: Previous GAAP carrying amount Rs. 42 lakh, Fair value at transition Rs. 65 lakh. Elect fair value as deemed cost → Opening PPE = Rs. 65 lakh, difference Rs. 23 lakh credited to retained earnings (net of deferred tax). Future depreciation is on Rs. 65 lakh over remaining useful life. No revaluation surplus — it’s deemed cost.
Machine: Previous GAAP carrying amount Rs. 42 lakh, Fair value at transition Rs. 65 lakh. Elect fair value as deemed cost → Opening PPE = Rs. 65 lakh, difference Rs. 23 lakh credited to retained earnings (net of deferred tax). Future depreciation is on Rs. 65 lakh over remaining useful life. No revaluation surplus — it’s deemed cost.
Business Combination — trap:
Goodwill under Previous GAAP is NOT amortised further; it is carried forward (adjusted for NFRS-required changes) and impairment-tested at transition even if no indicator exists. Intangibles that don’t meet NFRS 3 / NAS 38 are subsumed into goodwill.
Goodwill under Previous GAAP is NOT amortised further; it is carried forward (adjusted for NFRS-required changes) and impairment-tested at transition even if no indicator exists. Intangibles that don’t meet NFRS 3 / NAS 38 are subsumed into goodwill.
Chapter 9 • Fully Worked Example
ABC Manufacturing Ltd — equity reconciliation from NAS to NFRS
Facts: Transition date 1 Shrawan 2080. First NFRS statements FY 2081/82. Equity under Previous GAAP (NAS) at transition = Rs. 5,00,00,000. The following NFRS adjustments are identified. Tax rate assumed 25% for illustration.
| Adjustment | Rs. | Explanation |
|---|---|---|
| Equity under Previous GAAP | 5,00,00,000 | As reported under NAS |
| (a) PPE — fair value as deemed cost | +80,00,000 | Land & plant uplift to fair value |
| (b) Derecognise capitalised preliminary / deferred revenue exp. | −18,00,000 | Fails NAS 38 asset definition |
| (c) Defined benefit (gratuity) obligation — full recognition | −32,00,000 | Actuarial valuation under NAS 19 |
| (d) Expected Credit Loss on receivables (NFRS 9) | −14,00,000 | Lifetime ECL on trade receivables |
| (e) Investment property separated & at fair value | +22,00,000 | Previously in PPE at cost |
| (f) Deferred tax on above adjustments (net) | −9,50,000 | 25% on net taxable temporary differences |
| Equity under NFRS at transition | 5,28,50,000 | Net increase Rs. 28,50,000 (+5.7%) |
Figure 4 — Waterfall-style view of the same reconciliation. In the exam, present the table above; the chart is for understanding.
Journal logic at transition (summary)
| Entry | Dr | Cr |
|---|---|---|
| PPE A/c Dr. 80,00,000 → To Retained Earnings 80,00,000 | 80,00,000 | 80,00,000 |
| Retained Earnings Dr. 18,00,000 → To Deferred Expenses A/c 18,00,000 | 18,00,000 | 18,00,000 |
| Retained Earnings Dr. 32,00,000 → To Gratuity Obligation 32,00,000 | 32,00,000 | 32,00,000 |
| Retained Earnings Dr. 9,50,000 → To Deferred Tax Liability (net) 9,50,000 | 9,50,000 | 9,50,000 |
All transition journals bypass the current-year Profit & Loss — they adjust opening retained earnings. Subsequent depreciation, gratuity cost, ECL movements after transition do go through P&L / OCI as normal.
Second example — Profit reconciliation (comparative year FY 2080/81)
Profit under Previous GAAP: Rs. 72,00,000. Add: lower depreciation on derecognised assets +3,00,000; Less: additional depreciation on deemed-cost PPE −9,00,000; gratuity cost increase −4,50,000; ECL charge −2,00,000; Add: fair value gain on investment property +6,00,000; Tax effect +1,12,500 → Profit under NFRS = Rs. 66,62,500. Total Comprehensive Income reconciliation follows the same logic plus OCI items (re-measurements, FVOCI).
Chapter 10 • Presentation & Disclosure
What the first NFRS statements must show
The 3 mandatory reconciliations
1. Equity at Transition Date
Previous GAAP equity → NFRS equity at date of transition.
2. Equity at End of Latest Previous-GAAP Period
Previous GAAP equity → NFRS equity at end of the comparative year.
3. Total Comprehensive Income
Previous GAAP profit/TCI → NFRS TCI for the latest period presented under Previous GAAP.
- Reconciliations must give sufficient detail to understand material adjustments — line-by-line for SFP and SCI, distinguishing correction of errors from changes in accounting policies.
- If cash flow statement was presented under Previous GAAP, explain material adjustments to it as well.
- If the entity becomes aware of errors under Previous GAAP, the reconciliations must separate them (NFRS 1 does not fix old errors silently into policy changes).
- Disclose exemptions elected, deemed-cost fair values & aggregate adjustment, and the fact that the statements are the first NFRS statements.
- Comparative information: At least one year under NFRS. Non-NFRS comparative historical summaries, if included, must be prominently labelled “not prepared under NFRS”.
- Interim reports: Reconciliations for the comparable interim period (equity at interim transition-equivalent date + TCI) are required in the first NFRS year.
Presentation reminder (NAS 1): Present a third Statement of Financial Position as at the beginning of the preceding period when retrospective restatement has a material effect — in first-time adoption, that is effectively the opening NFRS SFP.
Chapter 11 • Special Topics
Impairment, deferred tax, and the “second adoption” question
Impairment at transition (NAS 36)
Test assets — especially goodwill from un-restated business combinations — for impairment at transition, using transition-date conditions (no hindsight).
Deferred Tax (NAS 12)
Recognise deferred tax on all temporary differences created by transition adjustments. This is the most-missed adjustment in student answers — every Dr/Cr to retained earnings needs its tax shadow.
Non-financial assets measured at FV as deemed cost
Later measurement follows the relevant standard (cost or revaluation model for PPE per NAS 16). Deemed cost is the new starting cost — it does not lock in a revaluation model.
Resuming NFRS after leaving it
If an entity previously reported under NFRS, stopped, and resumes, NFRS 1 gives specific guidance — in many cases it applies NFRS 1 again or applies standards retrospectively as if it never stopped, depending on the reason for stopping. Always read the facts carefully.
Exceptions vs Exemptions — the one table to memorise
| Mandatory Exceptions (App. B) | Optional Exemptions (App. C & D) | |
|---|---|---|
| Nature | Prohibition on retrospective application | Permission to not apply retrospectively |
| Choice? | No choice — must follow | Entity’s choice, item-by-item |
| Purpose | Prevent hindsight / misleading restatement | Cost-benefit relief |
| Examples | Estimates, hedge accounting, derecognition | Deemed cost, business combinations, CTA reset |
Chapter 12 • Exam & Practice Pitfalls
10 mistakes that cost marks — and money in real life
- Using the reporting date as transition date (it’s the start of the earliest comparative period).
- Routing transition adjustments through current-year P&L instead of opening retained earnings.
- Forgetting deferred tax on every transition adjustment.
- Applying hindsight to estimates / ECL / impairment at transition.
- Restating all past business combinations when the exemption was available — or restating a later one without restating consistency rule.
- Treating deemed-cost uplift as revaluation surplus (it’s retained earnings; deemed cost is new cost).
- Missing the goodwill impairment test at transition.
- Giving only one reconciliation (three are required — see §10).
- Confusing an exception (mandatory) with an exemption (optional) in theory answers.
- Ignoring Nepal carve-outs / regulatory requirements (NRB directives for BFIs, for example) that may affect NFRS application locally — always check the current ICAN / regulator notice.
First NFRS statements — final checklist
- Opening NFRS SFP prepared at transition date (4 steps completed)
- Accounting policies comply with NFRS effective at reporting date & applied consistently
- All mandatory exceptions applied; exemptions elected documented & disclosed
- Three reconciliations prepared, errors separated from policy changes
- Deferred tax recognised on all transition temporary differences
- Comparatives restated; third SFP presented if material
- Explicit & unreserved statement of compliance with NFRS included
Chapter 13 • Test Yourself
Quick revision quiz — 5 questions
Q1. First NFRS statements are for FY 2081/82 with one year comparative. Transition date is:
Q2. Transition adjustments are recognised in:
Q3. Which is a mandatory exception?
Q4. Fair value as deemed cost for PPE is credited to:
Q5. If you restate one pre-transition business combination under NFRS 3, you must:
One-page revision summary — read this the night before the exam
NFRS 1 in one paragraph: On the date of transition (start of earliest comparative period), prepare an opening NFRS balance sheet by recognising, derecognising, reclassifying and measuring everything under NFRS effective at the reporting date, with adjustments in retained earnings. Apply retrospectively, except where Appendix B forbids it (exceptions) and where Appendices C/D let you choose relief (exemptions). Use consistent policies throughout, make estimates without hindsight, and prove the journey with equity & TCI reconciliations from Previous GAAP to NFRS.
FAQs
Is NFRS 1 a one-time standard? For each entity, essentially yes — it governs only the first NFRS statements. After that, normal NFRS applies.
Do I need to publish the opening SFP? You must prepare it; publication as a third SFP follows NAS 1 materiality rules.
Can I elect some exemptions and not others? Yes — exemptions are independent, except business combinations consistency rule.
What is Previous GAAP in Nepal? Usually NAS as applied before NFRS, plus Companies Act requirements.
Sources & further study: NFRS 1 (ASB Nepal / ICAN, converged with IFRS 1 — First-time Adoption of IFRS), NAS 1, NAS 8, NAS 12, NFRS 3, NFRS 9, NFRS 13. For exam preparation, practise ICAN past-paper transition reconciliations and always state: transition date, policies basis, exceptions/exemptions used, and deferred tax — examiners award marks for that structure.