Kathmandu. The Securities Board of Nepal (SEBON) has adopted the strictest policy so far in checking the financial statements of companies willing to issue ordinary shares (IPO).

The Board has recently issued the ‘Standards on Review of Financial Statements, 2082 for the Initial Public Issue’, making arrangements to mandatorily keep the companies that are in loss, have weak net worth and are found deficient in the financial statements. This standard will come into effect from April 1, 2083.

Earlier, the examination of financial statements was considered comparatively easy in the process of IPO issuance. But now that the board will look closely at the details of each company based on financial indicators, it will be mandatory for companies to be transparent and sound their financial position before entering the market.