Ask five different companies what they paid for their statutory audit last year, and you will likely get five very different answers. That is not because auditors are inconsistent — it is because audit cost in a Nepal company depends heavily on turnover, the state of your bookkeeping, the industry you operate in, and how many locations your business runs from. Without a benchmark, it is hard to know whether a quote you receive is fair or whether you are being overcharged.
This guide breaks down realistic fee ranges by company size, explains what pushes audit costs up or down, and shows you how to budget for your annual audit well before the fiscal year closes. Whether you are budgeting for your very first statutory audit or simply trying to sanity-check a renewal quote from your existing auditor, having a clear benchmark makes the negotiation far easier.
Fee Range for Small Companies and Startups
For small private companies and early-stage startups with turnover up to roughly NPR 2 crore, audit fees typically fall between NPR 40,000 and NPR 1,00,000 annually. The Institute of Chartered Accountants of Nepal (ICAN) sets minimum fee guidelines that most licensed firms follow as a floor, so quotes significantly below this range are worth questioning rather than celebrating, since unusually low fees can sometimes mean a rushed or superficial audit.
Fee Range for Mid-Size Companies
Once a company's turnover moves into the NPR 2 crore to 15+ crore range, audit fees generally rise to somewhere between NPR 1,00,000 and NPR 3,00,000. At this stage, businesses usually have more transaction volume, multiple bank accounts, and sometimes inventory or payroll complexity, all of which add hours to the audit fieldwork and, in turn, to the fee. Companies in this bracket should also expect a more detailed management letter alongside the audit report, flagging internal control gaps that smaller companies may not typically receive.
Fee Range for Large or Complex Companies
Large companies, listed entities, banks, and other regulated financial institutions sit at the top end of the scale, with fees commonly ranging from NPR 3,00,000 to over NPR 10,00,000, depending on turnover, regulatory reporting requirements, and the number of branches or subsidiaries involved. Listed companies in particular face additional disclosure and compliance obligations under securities regulations, which further increases the audit scope and cost.
Factors That Increase Audit Cost
Several situations reliably push audit fees higher. A first-time audit usually costs more because the auditor has no prior-year working papers to build on and must independently verify opening balances. Poor bookkeeping — missing vouchers, unreconciled bank accounts, or a trial balance that does not tie out — forces the audit team to spend extra hours simply reconstructing accurate records before testing can even begin. Industry complexity, such as manufacturing with detailed inventory costing, construction with long-term contracts, or financial services with regulatory reporting, adds specialised procedures. And companies operating from multiple locations or branches often require site visits or additional confirmations, which extend both the timeline and the fee.
Factors That Reduce Audit Cost
On the other side, a few habits consistently keep audit costs down. Clean, well-organised records mean the auditor spends less time on preparatory work and more time on actual verification. Engaging your auditor early — ideally a few months before year-end — allows for an interim review that catches issues while there is still time to fix them, rather than during the compressed final audit window. And businesses that maintain digital bookkeeping through accounting software, rather than manual registers, make it far easier for auditors to extract, sample, and verify transactions efficiently, which typically translates into fewer billed hours.
Statutory Audit vs Tax Audit: Separate Fees or Bundled?
In Nepal, the statutory audit required under the Companies Act and the tax-related certifications required for income tax filing are related but distinct engagements. Many audit firms bundle both into a single engagement letter and quote one combined fee, since much of the underlying verification work overlaps. However, if your company also needs a separate tax audit opinion, transfer pricing documentation, or a specific certification for a regulatory body, expect this to be quoted as an additional line item rather than being automatically included in the base statutory audit fee. Always ask your auditor to clearly separate these components in the fee proposal so you know exactly what you are paying for.
How to Budget and Plan Ahead
The most reliable way to budget for your audit is to request a written fee proposal from your auditor as early as possible in the fiscal year, rather than waiting until year-end. Ask specifically whether the quote covers the statutory audit alone or includes tax certification work, and clarify how additional queries, revisions, or a first-time audit adjustment might affect the final bill. Setting aside a provision equal to at least the prior year's audit fee, adjusted upward for turnover growth, is a reasonable starting point for companies budgeting for the first time.
Conclusion
Statutory audit fees in Nepal are not arbitrary — they scale with turnover, complexity, and how audit-ready your records are when the auditor walks in. By understanding where your company falls on this fee spectrum and taking simple steps like early engagement and digital bookkeeping, you can keep your audit cost predictable and avoid unpleasant surprises at year-end.
Need a clear, itemised audit fee proposal for your company? Reach out to our team at Bandhu Fintech and we will walk you through exactly what to expect.
Disclaimer: This article is for general information only and does not constitute legal or tax advice. Please consult an ICAN-registered Chartered Accountant for guidance specific to your company's circumstances.
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