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Key Facts: ICAN CA Foundation Exam

4 Papers

100 marks each, 3 hours each

ICAN Modality of New CA Syllabus

60% / 40%

Objective (MCQ) and subjective share of marks

ICAN Modality of New CA Syllabus

40% / 50%

Minimum per paper and aggregate to pass

ICAN Final Exam Criteria

NPR 1,150

Exam fee per paper (plus NPR 200 form fee)

ICAN Final Exam Criteria

Dec 2026

Last examination under the old CAP-I syllabus

ICAN Modality of New CA Syllabus

June & Dec

Examinations held in the first week of each

ICAN Final Exam Criteria

ICAN's Foundation level has four 100-mark written papers of 3 hours each, held in the first week of June and December. About 60% of marks are objective MCQs and 40% subjective. To pass, a student needs 40% in each paper and 50% in aggregate at one sitting. The exam fee is NPR 1,150 per paper plus a NPR 200 form fee.

Sample ICAN CA Foundation Practice Questions

Try these sample questions to review concepts for the ICAN CA Foundation exam. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1The owner of a shop takes NPR 20,000 of goods home for family use. Which accounting concept requires this to be recorded as drawings rather than as a business expense?
A.Going concern concept
B.Business entity concept
C.Money measurement concept
D.Materiality concept
Explanation: The business entity concept treats the business as separate from its owner. Goods taken for personal use reduce the owner's capital as drawings; they are not a cost of running the business.
2Under the accrual basis of accounting, when is revenue from selling goods recognized?
A.When cash is received from the customer, even if goods are delivered later
B.When the customer first makes an enquiry about the goods
C.When the raw materials for the goods are purchased
D.When control of the goods passes to the customer, whether or not cash has been received
Explanation: Accrual accounting records income when it is earned and expenses when they are incurred, not when cash moves. Under NFRS 15, revenue from goods is recognized when control passes to the customer.
3A business bought a delivery van for NPR 2,500,000. A year later a dealer says it could be sold for NPR 3,200,000. Under the historical cost convention, how is the van shown in the accounts (no revaluation policy is used)?
A.At NPR 3,200,000, its current resale value
B.At the average of cost and resale value
C.At cost less accumulated depreciation
D.At nil, because it has been used for a year
Explanation: Under historical cost, assets are recorded at their purchase cost and carried at cost less depreciation. Market value is used only if the entity adopts the revaluation model permitted by NAS 16.
4Which of the following costs should be capitalized as part of the cost of a new machine?
A.Import duty, transport and installation costs
B.The annual fire insurance premium paid after installation
C.Lubricating oil and grease used during normal production
D.The operator's wages for the first six months of production
Explanation: Costs directly attributable to bringing an asset to the location and condition for its intended use, such as duties, delivery and installation, are capitalized. Running costs after the asset is in use are expenses.
5A trader buys goods worth NPR 50,000 on credit from Sita Traders. Which double entry records this?
A.Debit Sita Traders NPR 50,000; credit Purchases NPR 50,000
B.Debit Cash NPR 50,000; credit Sita Traders NPR 50,000
C.Debit Purchases NPR 50,000; credit Sita Traders NPR 50,000
D.Debit Purchases NPR 50,000; credit Cash NPR 50,000
Explanation: The purchases account is debited for goods bought for resale, and the supplier's account is credited because the business now owes Sita Traders NPR 50,000.
6What is a suspense account used for when preparing a trial balance?
A.To hold an unexplained trial balance difference until it is corrected
B.To accumulate the retained profits of the business over the years
C.To record amounts in dispute in a pending court case
D.To record transactions that the owner wants kept off the main ledger
Explanation: If the trial balance does not agree, the difference is placed in a suspense account so that work can continue. As each error is found, a correcting entry clears part of the suspense balance until it is nil.
7Which error will cause the totals of the trial balance to disagree?
A.Omitting a cash sale of NPR 5,000 from the books entirely
B.Debiting office furniture instead of office repairs with NPR 8,000
C.Two equal and opposite errors of NPR 4,000 in different accounts
D.Debiting purchases NPR 12,000 but crediting the supplier NPR 21,000
Explanation: Posting NPR 12,000 on the debit side and NPR 21,000 on the credit side creates a NPR 9,000 difference, so the trial balance will not agree.
8At year-end, office rent of NPR 15,000 for the last month is unpaid. What adjustment is needed?
A.Debit rent expense; credit accrued expenses NPR 15,000
B.Debit prepaid rent; credit rent expense with NPR 15,000
C.Make no adjustment until the rent is actually paid next year
D.Debit cash; credit rent expense with NPR 15,000 at year-end
Explanation: The rent relates to this year, so it is an expense of this year even though unpaid. The unpaid amount is shown as an accrual under current liabilities.
9Equipment costing NPR 800,000 is depreciated at 20% a year on the reducing balance method. What is its carrying amount at the end of the second year?
A.NPR 480,000
B.NPR 512,000
C.NPR 640,000
D.NPR 560,000
Explanation: Year 1: 20% x 800,000 = 160,000, leaving 640,000. Year 2: 20% x 640,000 = 128,000, leaving NPR 512,000.
10Receivables at year-end are NPR 200,000 and the allowance for doubtful debts is to be 5% of receivables. The existing allowance is NPR 6,000. What is charged to profit or loss for the year?
A.NPR 10,000
B.NPR 6,000
C.NPR 4,000
D.NPR 16,000
Explanation: Required allowance = 5% x 200,000 = NPR 10,000. Only the increase over the existing NPR 6,000 is charged: 10,000 - 6,000 = NPR 4,000.

About the ICAN CA Foundation Exam

The Foundation level is the first level of ICAN's new Chartered Accountancy syllabus, which replaced CAP-I for students registering from 15 May 2025. Its first examination was held in December 2025, and the old CAP-I syllabus is examined for the last time in December 2026. The four papers cover accounting, assurance and information systems, business and finance, and law and taxation. This bank is independent practice by OpenExamPrep: English-language multiple-choice questions for study, not a simulation of ICAN's written papers, which also contain subjective questions.

Exam sponsor: Institute of Chartered Accountants of Nepal (ICAN). The requirements and fees below concern the certification or admission exam, separate from our free practice resources.

Assessment

Four 100-mark written papers, each lasting 3 hours: Paper 1 Accounting; Paper 2 Part A Assurance and Part B Information Systems; Paper 3 Business and Finance; Paper 4 Part A Law and Part B Taxation. About 60% of marks are objective (MCQ) and 40% subjective. Students pass by scoring at least 40% in each paper and 50% in aggregate at one sitting.

Time Limit

3 hours per paper (4 papers)

Passing Score

40% per paper and 50% aggregate

Exam / Certification Fees

NPR 1,150 per paper (NPR 4,600) plus NPR 200 form fee

Exam sponsor website

Fees, eligibility, and exam policies can change. Confirm them with the exam sponsor before applying or paying.

Our practice resources: topics covered

We aim to reflect publicly available exam outlines and topic information in our study resources. Coverage, format, and difficulty may differ from the actual exam, and we cannot guarantee that every detail is accurate or current. Confirm exam requirements, fees, and policies with the official exam sponsor.

25%

Paper 1: Accounting

Double entry and trial balance, accruals, depreciation and irrecoverable debts, bank reconciliation and error correction, cost classification and behaviour, FIFO and weighted average stock, labour and overhead costing, and functional, cash and flexible budgets.

12%

Paper 2A: Assurance

The assurance concept and expectation gap, levels of assurance, Nepal's regulatory framework (Auditing Standards Board, certificate of practice, Auditor General), and the IESBA/ICAN Code of Ethics: fundamental principles, threats, the conceptual framework and confidentiality.

13%

Paper 2B: Information Systems

Data and information, transaction processing, executive support and ERP systems, FinTech (blockchain, payment services regulated by NRB, cloud services, cryptocurrency status in Nepal), and data security controls.

25%

Paper 3: Business and Finance

Business objectives and stakeholders, organisational structures, the finance function and sources of finance, governance and sustainability, the economic environment including monetary policy, and big data, analytics, data bias and automation.

12%

Paper 4A: Law

Sources of law, the Nepal Chartered Accountants Act 2053, contract provisions of the Muluki Civil Code 2074, the Partnership Act 2020, Companies Act 2063, Industrial Enterprises Act 2076, negotiable instruments and the Labour Act 2074.

13%

Paper 4B: Taxation

Direct and indirect taxes, PAN and tax administration, income year and income headings, VAT computation and invoices, return and instalment deadlines, withholding deadlines, and tax avoidance versus evasion.

Preparing for the ICAN CA Foundation Exam

What You Need to Know

  • Passing score: 40% per paper and 50% aggregate
  • Assessment: Four 100-mark written papers, each lasting 3 hours: Paper 1 Accounting; Paper 2 Part A Assurance and Part B Information Systems; Paper 3 Business and Finance; Paper 4 Part A Law and Part B Taxation. About 60% of marks are objective (MCQ) and 40% subjective. Students pass by scoring at least 40% in each paper and 50% in aggregate at one sitting.
  • Time limit: 3 hours per paper (4 papers)
  • Exam / certification fees: NPR 1,150 per paper (NPR 4,600) plus NPR 200 form fee Official sources

Using Our Practice Resources

  • Work through all 100 available questions
  • Review every answer and explanation
  • Track weak areas and revisit them
  • Use our AI tutor for tough concepts

ICAN CA Foundation: Suggested Study Strategy

1Practise full double-entry questions through to the trial balance and year-end adjustments; the Accounting paper gives equal weight to cost accounting and budgeting.
2Learn the IESBA fundamental principles and the five types of threat with an example of each.
3Study contract law from the Muluki Civil Code 2074 sections on formation, void and voidable contracts, not the repealed Contract Act 2056.
4Memorise key tax dates: income year (Shrawan to Ashad), instalments by Poush, Chaitra and Ashad, withholding within 25 days, and the return within three months.
5Work through ICAN's question bank and mock papers for the subjective parts, which an MCQ bank cannot practise.

Frequently Asked Questions

Has the ICAN Foundation level replaced CAP-I?

Yes. ICAN's new syllabus has Foundation, Application and Advisory levels. Foundation took effect for students registering on or after 15 May 2025, with its first examination in December 2025. ICAN's modality schedules the last CAP-I examination for December 2026, and only Foundation is examined from June 2027.

What is the format of the ICAN Foundation examination?

There are four 100-mark papers of 3 hours each: Accounting; Assurance and Information Systems; Business and Finance; and Law and Taxation. ICAN's modality states that about 60% of marks are objective (MCQ) questions and 40% subjective. ICAN does not publish a fixed number of questions.

What are the passing marks and exam fee?

A student passes by scoring at least 40% in each paper and 50% in aggregate at one sitting. ICAN's fee schedule lists NPR 1,150 per paper for CAP-I/Foundation, a NPR 200 form fee and a NPR 500 late fee.

Who can register, and when can I sit the exam?

Students who have passed Grade 12 or equivalent with at least GPA 2.0 (or hold a bachelor's degree with under 50% or CGPA 2.5) can register. They may sit the exam after 6 months of registration and after completing ICAN's online eligibility test. Exams are held in the first week of June and December.

In what language is the exam set?

ICAN publishes its syllabus, learning materials, question papers and suggested answers in English. This bank is an English-language practice resource; it is not an official ICAN product.

Is this bank a simulation of the ICAN Foundation papers?

No. It is an independent multiple-choice study adaptation by OpenExamPrep. The real papers combine objective questions with subjective questions that require written working, so use ICAN's learning materials and mock papers to practise the written parts.