ade acs papecoca seu THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal Chartered Accountants Act, 1997) aa Ret No Notice regarding Decision on Carve-outs in NFRS with Alternative Treatments auret ae aerare aig Sarewat faritr fae arora fade sfacqart (NFRS) athe wt are (Standard) #1 Carve-out Fert wh Harare agar seater ay avin Sears ase Sa tat Pater art anf re anita aTeazT Carve-out arg Rema aie ary arta satire aera Ferme ae aM ations Aart ards Carseat OH, 2ONS FT THT WS) ATEN Fes arisTaT Aree rer waa aif Carve-out ie araraean Bereta war select ATAREAT Carve-out ar wi Probe seer Biter avatars aaa oreertian wate at aaa warns whee Be 1 ave oer Meee uit TH Carve-out Tait disclosures faux fafa faaeor sar a waar | = Sans snes \Carve- | NFRS/ Existing Provision ‘Carve-out : Alternative Period of Out ‘Treatment hitiaber (one: Carve-out | 1 NERS 10 : Consolidated ancial Statements Preparation of consolidated financial statement using uniform accounting policies ‘A parent shall prepare consolidated | A parent shall prepare consolidated | FY 2017-18 financial statements using uniform | financial statements. using uniform Para 19 FY 2018-19 accounting policies for like transactions and | accounting pol for like other events in similar circumstances. transactions and other events in | FY 2019-20 similar circumstances unless it is impracticable to do so. Option © The carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the Financial Statements with its monitory impact on the Financial Statements as far as practicable. 2 NAS 17: Lease Operating lease in the financial statements of Lessees a Satdobato, Lalitpur, Nepal, Tel: 01-5530832, 5530730, Fax: 977-1-555074 1.0 ox5088 Email an@otcnetnp, Website www iimongon a ream a Branch Offices: liratnagar : Tel, 977-021-471395, E-mail: icanbrt@ican.org.np | Butwal : Tel. 977-071-543629, E-mail: icanbtl@ican.ore.my Birgu: Tel 37-06152256) E-macaniesogp | Pokhara Tel S7PMLNTOR, Eves Lareohan ee Nepal Tel 7.015896 Es ampjecanorgnp | Dhangadh 770815009 Ene keraee eeqe acs UpRBetsca He THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal Chartered Accountants Act, aa. Ref No. 1997) Para 33 representative of the time pattern of the eee representative of Tease payments under an operating Tease | Lease payments under an operating shall be recognised as an expense on a| lease shall be recognised as an straight-line basis over the lease term unless | expense on a straight-line basis over another systematic basis is.__more | the lease term unless either: (a) Another systematic basis is more the time pattern of the user's benefit even if the payments to the lessors are not on that basis; or (b) The payments to the lessor are structured to increase in line with expected general inflation to compensate for the lessor's expected inflationary cost increases. If payments to the lessor vary because of factors other than general inflation then this condition is not met. 2017-18 Option Financial Statements with its monitory impact on the Financial practicable. © The carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the Statements as far as 2 NAS 28 : Investments in Associates and Joint Ventures uniform accounting policies ‘Accounting for Investment in Associates as per equity method using The entity’s financial statements shall be] The entity’s financial Para 35 | PP 5 al for like transactions and events in similar | accounting policies circumstances. transactions and events so. statements prepared using uniform accounting policies | shall be prepared using uniform for like in similar circumstances unless, in case of an associate, it is impracticable to do FY 2017-18 FY 2018-19 FY 2019-20 Satdobato, Lalitpur, Nepal, Tek: O1-5530832, 5530730, Fax: 977 P.O Box 3288, E-mail: ican@ntc:net.np, Website: www-ican.org.np Branch Offices: Biratnagar : Tel, 977-021-471395, E-mail icanbrt@ican.org.np | Butwal: Tel. 977-071-543629, E-mail: anbil@ican org.np Birgunj: Tel, 977-051-522660, E-mail: icanbrj@ican.org.np | Pokhara: Tel, 977-061-537679, E-mail: icanpkrBican org.np Nepalgunj: Tel 977-081-525516, E-mail: carpj@ican orginp | Dhangadhi : 977-091-527493, E-mail: candhg@iaoe dics VwHBecocH Bee THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal Chartered Accountants Act, 1997) aa Ref No. ae ‘Option «The carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the | Financial Statements with its monitory impact on the Financial Statements as far as practicable. 4 NAS 34: Interim Financial Reporting. Impracticable to restate the corresponding previous interim period information Ifan entity’s interim financial report | Ifan entity’s interim financial report para |'8 described as complying with |is described as complying with Iry 2917.18 NFRSs, it must comply with all of | NFRSs, it must comply with all of the requirements of this Standard. | the requirements of this Standard. FY 2018-19 Paragraph 19 requires certain | Paragraph 19 requires certain disclosures in that regard. disclosures in that regard. However, an entity shall not require to restate its corresponding previous interim period balance if itis impracticable | [19 esta Option \the carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the Financial statements with its monitory impact on the Financial Statements as far as practicable. is any objective evidence that a financial asset or group of financial assets measured at amortised cost is impaired, If any such evidence exists, the entity shall apply | paragraph 63 to determine the amount of any impairment loss. + NAS 39 : Financial Instruments: Recognition and Measurement I Incurred Loss Model to measure the Impairment Loss on Loan and. Advances ‘An enlity shall assess at the end of | An entity shall assess at the end of Paras | €8 feporting period whether there | each reporting period whether there is any objective evidence that a financial asset or group of financial assets measured at amortised cost is impaired. If any such evidence exists, the entity shall apply paragraph 63 to determine the amount of any impairment loss FY 2017-18 FY 2018-19 Satdobato, Lalitpur, Nepal, Tel 01-5530832, 5530730, Fax: 977-1-5550774 SB P.O Box 5289, E-mail icandntcnet.np, Website: www ican.org.np 2 ; Branch Offices: iratnagar : Tel, 977-021-471395, E-mail: icanbrt@ican.org.np | Butwal: Te. 97-071-543629, E-mail: icanbtl@ican orgy Birgunj: Tel. 977-051-522660, E-mail: icanbyj@ican.org.np | Pokhara : Tel. 97-061-537679, E-mail icanplo ican orgs Nepalgunj : Tel 977-081-525916, E-mail: icannpj@ican.org np | Dhangadhi: 977-091-527493, E-mail : icandhg@ican.org.npaa RefNo. ae acs Vwecocet Beet ‘THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal Charteréd Accountants Act, 1997) uwiless the entity ts Bank or financial institutions registered as per Bank and Financial Institutions Act, 2073. Such entities shall measure impairment loss on loan and advances as the higher of amount derived as per norms prescribed by Nepal Rastra Bank for loan loss provision and amount determined as ‘per paragraph 63; and shall apply paragraph 63 to measure the impairment loss on financial assets other than loan and advances. The entity shall disclose the impairment loss as per this carve-out and the amount of impairment loss determined as per paragraph 63. FY 2019-20 | fot Optional Bank and Financial Institutions shall measure impairment loss on loan and advances as the higher of amount derived as per norms prescribed by Nepal Rastra Bank for loan loss provision and amount determined as per paragraph 63; and shall apply paragraph 63 to measure the impairment loss on financial assets and other assets other than Joan and advances. The Bank and Financial Institutions shall disclose the impairment loss as per this carve-out and the amount of impairment loss determined as per paragraph 63. 6 NAS 39: Financial Instruments: Recogni yn and Measurement Impracticability to determine transaction cost of all previous years which is the part of effective interest rate Para 9 The effective interest rate is the rate | The effective interest rate is the rate | that exactly discounts estimated | that exactly discounts estimated | [Definitions future cash payments or receipts | future cash payments or receipts relating to} through the expected life of the | through the expected life of the | FY 2017-18 recognition and} financial instrument or, when | financial instrument or, when | py 2918-19 measurement | appropriate, shorter period to the | appropriate, a shorter period to the | net carrying amount of the financial amount of the financial | Satdobato, Lalitpur, Nepal, Tel: 01-5530832, 5530730, Fax: 977-1-5550774 P.O Box 5288, E-mail: ican@ntenet np, Website: www ican.org np Branch Offices: Biratnagar : Tel, 977-021-471395, E-mail icanbrt@ican.org.np | Butwal: Tel. 977-071-543629, E-mail: icanbtldican.org.np Birgunj: Tel, 977-051-522660, E-mail: canbri@ican.org.np | Pokhara: Tel. 977-061-537679, E-mail: icanpkr@ican.org np Nepalgunj: Tel. 977-081-525916, E-mail: icannpj@ican.org.np | Dhangadhi : 977-081-527493, E-mail: candhg@ican org npaa Ref No. ade acs va SoCocRT AT THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal’ Chartered Accountants Act, 1997) ‘asset or financial liability. When calculating the effective interest rate, ‘an entity shall estimate cash flows considering all contractual terms of the — financial (for example, prepayment, call and similar options) but shall not consider future credit losses. The calculation includes all fees and points paid or received between parties to the contract that are an integral part of the effective interest rate (see NAS 18 Revenue), transaction other premiums or discounts. There is @ presumption that the cash flows and the expected life of a group of similar financial instruments can be estimated reliably. However, in those rare cases when it is not possible to estimate reliably the cash flows or the expected life of a financial instrument (or group of financial instruments), the entity shall use the contractual cash flows over the full contractual term of the financial instrument (or group of financial instruments), instrument costs, and all asset or financial liability. When calculating the effective interest rate, an entity shall estimate cash flows considering all contractual terms of the financial instrument (for example, prepayment, call and similar options) but shall not consider future credit losses. The calculation includes all fees and points paid or received, unless it is immaterial or impracticable 10 determine reliably, between parties to the contract that are an integral part of the effective interest rate (see NAS 18 Revenue), transaction costs ‘and all other premiums or discounts. There is a presumption that the cash flows and the expected life of a group of similar financial instruments can be estimated reliably. However, in those rare cases when it is not possible to estimate reliably the cash flows or the expected life of a financial instrument (or group of financial instruments), the entity shall use the contractual cash flows over the full contractual term of the financial instrument (or group of financial instruments). Option © The carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the Financial Statements with its monitory impact on the Financial Statements as far as practicable. 7 NAS 39: Financial Instruments: Recognition and Measurement Ape Satdobato, Lalitpur, Nepal, Te: (1-5530832, 5530730, Fax: 977-1-5850774 P.O Box 5289, E-mail: ican@ntc:net.np, Website: www ican org.np Branch Offices: Biratnagar : Tel, 977-021-471395, E-mail icanbri@ican.orgnp | Butwal : Tel. 977-071-543629, E-mail: icanbtl@ican.org.np Birgunj: Tel, 977-051-522660, E-mail: anbrj@ican.org.np | Pokhara : Tel. 977-061-537679, E-mail: icanpkr@ican.org.np Nepalgunj : Tel. 977-081-525916, E-mail: icannpj@ican.org.np | Dhangadhi : 977-091-527493, E-mail icandhg@ican.org.npset ads papedsaa zee THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NEPAL (Established under the Nepal Chartered Accountants Act, 1997) aa Ref No ‘Tnipracticabllity to determine Inierest income on amortized cost ‘Once a financial asset or a group of | Once a financial asset or a group of \Para AG93 similar financial assets has been | similar financial assets has been Interest income | written down as a result of an| written down as a result of an after impairment loss, interest income is | impairment loss, interest income is | FY 2017-18 impairment | thereafter recognised using the rate | thereafter recognised using the rate | py 2918-19 recognition | of interest used to discount the future | of interest used to discount the Future cash flows for the purpose of | cash flows for the purpose of | FY 2019-20 measuring the impairment ss. measuring the impairment loss. Interest income shall be calculated by applying effective interest rate to the gross carrying amount of a financial asset unless the financial ‘asset is written off either partially or fully. Option © The carve-out is optional, if an entity opts to use this carve-out that should be disclosed in the Financial Statements with its monitory impact on the Financial Statements as far as practicable. Zp Satdobato, Lalitpur, Nepal, Tel: (1-3530832, 530730, Fax: 977-1-555074 PO Box 5289, E-mail: icandinte-net.np, Website: www.ican.org.np Branch Offices: Biratnagar : Tel. 977-021-471395, E-mail icanbrt@ican.orgnp | Butwal Tel. 977-071-543629, E-mail: icanbll@ican.org.np Birgunj: Tel, 977-051-522660, E-mail: icanbyj@ican.orginp | Pokhara : Tel. 977-061-537679, E-mail: icanpkr@ican.org.np Nepalguny : Tel, 977-081-525916, E-mail: icannpj@ican.org.np | Dhangadhi : 977-091-527493, E-mail: icandhg@ican.org.np