Auditing Standards Board (AuSB) has been constituted by the Government of Nepal on 26 Falgun 2059 corresponding to 10 March, 2003 under Nepal Chartered Accountants Act, 1997 (first amendment 2002). The AuSB consists of   7 members comprising of representatives from Ministry of Finance, Office of the Auditor General, Institute of Chartered Accounts of Nepal and from Registered auditor nominated by Government of Nepal. The board has full discretion in developing and pursuing the technical agenda for setting Auditing Standards.

The main function of AuSB is to review existing practices in Nepal and to develop Nepal Standards on Auditing (NSAs) so that these may be issued and regulated by the Council of the ICAN. While formulating NSA(s), the AuSB considers the applicable laws, customs, usages and business environments in Nepal . The NSAs are issued under the authority of the Chartered Accountants Act, 1997 (first amendment 2002). The AuSB issues Guidance notes on the issues arising from the NSAs wherever necessary. AuSB reviews and revises the NSAs at periodical intervals or as per the need of the respective standards.The AuSB determines the broad areas in which the NSAs need to be formulated and the priority in regard to the selection thereof.

The AuSB, till date, has formulated 30 Nepal Standards on Auditing and 2 guidance note. It has revised the following NSAs NSA 200, NSA 210, NSA 230, NSA 240, NSA 300, NSA 260, NSA 250, and Nepal Framework for Assurance Engagements, by the Year 2007/08. Rest of the NSAs are in the process of revision