[Prepared Based on structured interviews with professionals actively engaged in outsourcing business, the section summarizes entry pathways, service offerings, operational scale, regulatory and compliance environments, skills and technology readiness, competitive positioning, and emerging global trends, challenges and way forward with suggestion to new entrants in the outsourcing/offshoring space. The section contributes to evidence-based dialogue and support Nepal’s positioning as a credible destination for global accounting and audit outsourcing services]

 

Interviewee Spotlight

 

Name of Interviewee	Professional/Academic Background	Current Position and Associated Organization	Current Practice Model
Umesh Rijal	Chartered Accountant and MBA	Director of Nepal Operations, NOW CFO	Captive offshore services
Shankar Thapa	Fellow Chartered Accountant, CPFA	Partner, Shankar Associate, Chartered Accountants	Domestic practice with foreign clients
Pashupati Thapaliya	Chartered Accountant (ICAI)	Partner, AGK Partners	Independent outsourcing firm
Raju Gajurel	CA (ICAN), FCCA (UK), CFA (USA), CTA (UK)	CEO, Sterling Wells	Subsidiary of UK based group of accountancy firm

 

Interview Question and Analysis of Interviewee Response

 

Section A: About the Firm (Service Offered, Team Composition, Client Profile)

 

Q1: What is your motivation for working in accounting and finance outsourcing space in Nepal and how did your firm’s service offerings evolve over time?

The core motivation behind starting outsourcing business in Nepal was to position Nepal as a credible global hub for high-quality accounting and finance services based on professional excellence rather than cost alone. By leveraging Nepal’s strong accounting education system, skilled young workforce, and alignment with international standards, the practitioners aim to create sustainable, rewarding careers, increase global exposure for Nepali professionals, contribute to foreign currency inflows, and enhance the international reputation and confidence of Nepal’s accounting profession.

 

“We provide accounting services ranging from bookkeeping to the virtual CFO to the US-based client. We initially started with bookkeeping operations in Nepal, and eventually with our talent and delivery, the service offerings started to grow further in complexity and technicality.” - Umesh Rijal

 

“We started our service from basic manual data entry service. Gradually we evolved from transactional finance support to strategic finance support. These services include P2P, O2C, R2R, Financial Reporting, Management Accounting, FP&A, Group Control, Consolidation, Treasury and Business Intelligence.” - Shankar Thapa

 

 “We started with basic accounting and compliance support, but now we offer a complete range of outsourced finance solutions from management reporting and tax compliance to strategic advisory and virtual CFO services. This growth has come from continuously learning, embracing new technologies, and focusing on building long-term relationships with our clients.” —  Pashupati Thapaliya

 

“Sterling Wells Nepal was established to support UK-based accountancy firms and regulated businesses through data processing and software services for accountancy & tax areas delivered under strict UK governance frameworks. Over time, our services have evolved from transactional delivery to specialized, insight-led solutions combining technology, disciplined processes, and professional judgment. —  Raju Gajurel

 

Q2: What is your current team composition in terms of size and qualifications?

Most of the entities have a multidisciplinary structure with scalable team model that enables them to deliver end-to-end professional services while effectively managing technical complexity, regulatory risk and operational scale for international clients. The workforce generally includes Chartered Accountants, ACCA, engineers, tax advisors, legal practitioners and graduates from diverse academics. The number of staffs of the outsourcing firms ranges from 75 – 150.

 

Q3: What is your client base and market reach?

The firms serve an international client base across multiple jurisdictions, including USA, Europe region – UK and New Zealand, Middle East and South America.

 

“We serve entirely US-based clients.” —  Umesh Rijal

 

“The clients we serve are based in Europe region primarily in The Netherlands and have expanded to US, UK and New Zealand. We currently serve 8 international clients which include corporates as well as accounting firms.” —  Shankar Thapa

 

“We’re part of a UK Top 20 firm, and our client base spans across the globe from India and the Middle East to Europe and South America.” —  Pashupati Thapaliya

 

“Our client base spans multiple jurisdictions, with a strong concentration in the UK market. We support thousands of clients, ranging from individual professionals to structured businesses and technology-enabled platforms, through strategic partnerships with our UK based fellow group companies in the accountancy and technology sector.” —  Raju Gajurel

 

Section B: Compliance and Operating Environment

 

Q4: Can you mention about the key legal and regulatory requirements to start and operate an accounting/audit outsourcing practice in Nepal?

Accounting and audit outsourcing firms in Nepal must basically comply with legal and regulatory provision related with business registration, labour laws, social security obligations, foreign exchange regulation issued by Nepal Rastra Bank. Firm must specifically adhere to arm’s length pricing for cross-border-related party transactions and ensure other tax compliance.

 

Besides, there is a stringent data protection and confidentiality requirement for both Nepalese law and the client jurisdiction. Hence, firms shall provide assurance on data privacy and secrecy as accounting operations are exposed to the most sensitive financial and non-financial data. For this, outsourcing firms shall consider obtaining ISO 27001 certification or related certification, General Data Protection Regulation (GDPR) compliance and conducting Information System Audit.  Moreover, cyber –security insurance professional indemnity insurance provides level of comfort to the clients.

 

Q5: What are the key resources, technical /professional expertise and skills for Nepalese firms to succeed in global accounting and audit outsourcing? In your perspective, to what extent are Nepali firms prepared in this regard?

Success in global accounting and audit outsourcing requires technical competence, ethical discipline, deep understanding of international standards, strong communication skills, and technology-enabled process maturity.

 

Strong Technical knowledge and understanding of international standards such as IFRS, UK GAAP, and International Auditing Standards, along with knowledge of different countries’ tax rules and international taxation practices is primary requirement for outsourcing business.

 

Knowledge of accounting software/ platforms such as QuickBooks Online, Xero, NetSuite, Business Central, SAP, CaseWare Sage, G-Suite, MS Office, Xero, QuickBooks, Netsuite, SAP, Dynamics, Tagetik, Workday, Twinfield, Basecone, Accumatica, Pleo, PowerBI, Tableau, bill.com, ramp etc. shall be beneficial.

 

Fluency in written and spoken English, understanding cultural differences, understanding of cross-cultural awareness, communication nuances, emotional intelligence, teamwork are crucial factor in operating outsourcing business

 

Besides, professional discipline, documentation quality, consistency, and ethical rigor aids in strengthening firms’ strategic advantages and ensuring sustainability in global market.

 

Q6: What is the core competitive advantages of Nepali accounting and audit firms in the global outsourcing market?

Nepal’s competitive advantage in accounting and finance outsourcing lies in its young, technically competent professionals with strong English proficiency and increasingly technology literate workforce and significant cost efficiency. Besides, Nepalese professionals are widely regarded for their strong reputation for integrity and honesty.

 

Section C: Challenges and Way Forward

 

Q7: What are the most significant challenges your firm faces today in scaling or sustaining outsourcing services?

Nepali outsourcing firms face several challenges, including complex legal and regulatory requirements, talent retention amid ongoing outward migration, and limited global awareness of Nepal as an outsourcing destination. Communication skills and alignment with evolving global expectations such as data analytics, automation, and deeper sector expertise—also remain areas needing improvement.

 

Additionally, perception issues around political stability, regulatory certainty, and data protection frameworks can affect international client trust. However, these challenges are increasingly viewed as opportunities to strengthen governance, invest in technology, enhance skills, and build credibility through consistent performance. With resilient professionals, structured training, and growing global demand, Nepali firms are well positioned to overcome these barriers and establish Nepal as a reliable, long-term outsourcing hub.

 

Q8: What regulatory ambiguities, gaps, or operational challenges do you face in cross-border practice?

Outsourcing firms in Nepal faces challenges due to unclear regulatory and compliance framework. Restrictive foreign currency regulations often complicate international payment settlements, and the absence of defined professional indemnity requirements leaves outsourcing firms without a formal risk protection mechanism. Lack of adequate insurance policies including professional indemnity or cyber security is another operational challenge for firms.

 

One major ambiguity is the lack of clear regulation on the level and nature of accounting or audit support work that can legally be provided from Nepal, which often creates uncertainty when working with international firms. Despite having highly skilled professionals, Nepali firms are sometimes confined to providing only basic accounting and audit support due to this regulatory gray area.

 

Data privacy is another major concern, as Nepal does not yet have comprehensive data protection laws aligned with global frameworks like GDPR, making some foreign clients hesitant to share sensitive information.

 

There is no regulator for the BPO business in Nepal. However, clearer, coordinated regulatory frameworks especially around forex, data privacy, and professional risk coverage would reduce uncertainty, build client confidence, and significantly strengthen Nepal’s position as a credible global outsourcing destination.

 

Q9: Do you have branch offices outside Nepal? What marketing strategies and mechanisms do you place for generating business lead?

Most of the outsourcing firms do not have branch office outside Nepal. While they do not use traditional aggressive marketing campaigns for generating business led rather rely on professional reputation, client referrals and consistent service quality. The business lead is mostly generated in the following manner:

 

Referral: As a relationship-driven business, the firm leverages its professional reputation and the specific expertise of its team to retain long-term clients. Existing clients refer the outsourcing firm with other clients based on satisfaction with their work.

 

Personal Network: Firm also works with multiple individuals in their target countries to generate leads.

 

Strategic Partnerships: Business are generated based on strategic partnership with international firms.

 

Problem-Led Approach: Firms focus on deeply understanding client pain points and demonstrating how their services simplify complexity, ensure compliance, and deliver measurable value. This approach has enabled firms to build long-term, trust-based relationships.

 

Q10: What specific actions or reforms would you recommend from the Government of Nepal, ICAN, NRB, Tax authorities, and other regulators to support the growth of accounting and audit outsourcing?

 

Summarizing the responses on above it revealed as follows:

Reforms Action from Government side

• Digitalization of Government operation.
• Recognize the BPO/KPO as priority sector of Nepal in international forum and provide visibility through different embassies and facilitate coordination with diaspora.
• Provide clearer tax policies that can assist the outsourcing firms to predict and make decisions
• Tax incentives to support firms working with global clients.
• Strong data protection and privacy laws that align with international frameworks.
• Collaborative regulatory approach that prioritizes clarity, consistency, and constructive engagement over restrictive or fragmented regulations to enable sustainable sector growth.
• Simplifying and accelerating processes related to foreign direct investment, cross-border service delivery, and operational approvals would significantly enhance Nepal’s attractiveness as an outsourcing destination.

 

Reforms Action from ICAN side

• Proactive steps to promote BPO as an industry within the members and students.
• Encouraging continuous training in areas like technology, international taxation, and audit software, and helping firms meet international standards.
• Developing a talent pool apart from CA.
• Policy reform to consider working with BPO/KPO firms to be included in articleship / Industrial Trainee period.

 

Reform Action from NRB side

• NRB should make it easier and faster to handle foreign currency transactions for service export and easy payment of service charges to the foreign service providers.
• Easing the foreign exchange related rules.

 

“Establishing an FDI-backed entity in India can often be completed within days, whereas similar processes in Nepal may take several months despite the existence of a unified FDI desk. Addressing such operational bottlenecks would materially improve investor confidence, employment generation, and Nepal’s global integration in professional services.” —  Raju Gajurel

 

Q11: Which countries or regions do you see as Nepal’s main competitors in accounting and finance outsourcing? How do Nepali firms compare with them in terms of quality, scale, and credibility?

Nepal is just beginning to enter this industry while countries like India and Philippines are at their peak. India leads in skills and experience, while the Philippines and Africa are strong on cost Moreover, Bangladesh, Sri Lanka, Vietnam, Macedonia and Romania are also emerging as credible outsourcing hub. But Nepali firms are quickly catching up with quality, reliability, and a growing global reputation.

 

Q12: What major global trends do you observe in accounting, audit, and Knowledge Process Outsourcing? What opportunities should Nepali firms prioritize over the next 5/10 years?

Globally, accounting, audit, and KPO services are rapidly evolving with the rise of automation, cloud technology, data analytics, and artificial intelligence. Clients now look for faster, more insightful, and technology-driven solutions rather than just traditional compliance work.

 

For Nepali firms, this opens exciting opportunities. Over the next 5 to 10 years, we should focus on building expertise in tech-enabled accounting, specialized audit support, data analytics, and virtual CFO services. By investing in technology, digital skills, and international exposure, Nepali firms can move from routine tasks to delivering high-value strategic services in the global market. Those who adapt early will capture disproportionate opportunities in the coming decade.

 

Section D: Practical Roadmap for New Entrants

 

Q13: Based on your experience, what guidance would you offer to accounting firms or professionals in Nepal who are planning to enter the outsourcing/offshoring space?

 

Strategic Positioning and Visibility

• Start building the portfolio, see how things are working in this space, start the conversation and dialogue. Only then our presence can be seen globally.

 

Technical Proficiency

• Build up technical capabilities based on the area of service you are planning for. Invest in regular training and skills development, obtain certification courses on International Standards and various software.
• Global clients expect more than just accounting knowledge — they look for people who understand international standards like IFRS or UK GAAP and can work confidently with modern tools such as Xero, QuickBooks, and CaseWare.
• Global clients increasingly expect technology-enabled delivery across accounting, tax, and audit services. In contrast to traditional manual practices, international markets demand structured processes, automation, real-time reporting, and disciplined use of technology. Outsourced accounting services are also highly deadline-driven, requiring consistent quality and reliability under strict regulatory timelines.

 

Professionalism

• To compete globally, firms must demonstrate professionalism in every engagement and build delivery models aligned with international standards combining the right people, robust governance, and technology-led workflows. Firms that invest in global-grade delivery capabilities will be well positioned to succeed in the international outsourcing market.

 

Patience & Persistence

• Take your time to explore and learn because getting clients and delivering is not as easy as it looks. It will take a lot of patience and persistence. If possible, visit prospective markets and interact face to face as talking in person will give more value in terms of trust build up than virtual interactions.
• Firms should enter the outsourcing space with a clear sense of purpose. Success depends on understanding the specific problems you aim to solve and how your services deliver differentiated value. Entering the market purely because of perceived opportunity, without depth of capability or positioning, is unlikely to be sustainable.

 

Conclusion:

 

Overall, the profile interviews highlight that Nepal’s accounting, audit, and knowledge process outsourcing landscape is transitioning from basic transactional support to higher-value, technology-enabled and insight-driven services. Nepal demonstrates a capable talent pool with of young professionals, with strong ethical practice, sound professional and technical knowledge in alignment with international standards.

 

While Nepali firms demonstrate clear competitive advantages in quality, integrity, cost efficiency, and adaptability, the sector’s sustainable growth depends on addressing persistent regulatory ambiguities, foreign exchange constraints, data protection gaps, and limited global visibility. The collective insights of practitioners underscore that coordinated policy reforms, stronger institutional support, targeted skill and technology investments, and clearer cross-border operating frameworks are critical to unlocking Nepal’s full potential. With the right enabling environment and strategic focus, Nepal is well positioned to emerge as a credible, resilient, and long-term destination for global accounting and audit outsourcing, offering meaningful opportunities for both established firms and new entrants in the decade ahead.