If you run a company in Nepal, an audit visit is not a question of if — it is a question of when. The good news: most serious findings are documentation failures, not legal violations. Companies that keep simple, consistent records pass audits smoothly; companies that don’t get fined for problems they could have solved in an afternoon.
Here is the 10-point checklist I use in every internal audit.
1. Company registration & renewals
- Company/registration certificate — valid and displayed
- PAN/VAT registration — renewed
- Office licence/Permit renewals — tracked in a reminder calendar
- Labour registration — valid
Set a single “compliance calendar” at the start of the year with every renewal date. One spreadsheet solves 70% of this checklist.
2. Employment contracts
- Every employee has a signed contract in a language they understand
- Contracts state: position, salary, allowances, leave, termination terms
- No verbal-only employment (this is the single most common finding)
3. Wages & minimum wage
- Wages paid at or above the government minimum wage
- Salary slips issued every month, signed or acknowledged
- Overtime hours registered and paid at the legal rate
- Salary paid through the bank (recommended — creates an automatic trail)
4. Provident Fund & Social Security
- PF/Social Security contributions deducted and deposited on time every month
- Contribution records available for each employee
- New employees registered within the legal timeline
5. Working hours & leave registers
- Daily attendance register maintained (or digital attendance)
- Leave records: annual, sick, casual, maternity/paternity
- Weekly holiday and overtime registers correct
6. Health & safety
- First aid box, fire extinguisher, emergency exits
- Safety training records for relevant roles
- Accident / near-miss register maintained
7. Statutory registers
- Register of employees (with all personal details)
- Register of wages, register of leave, register of PF contributions
- Every register updated in the current year — old registers with a gap are treated as missing
8. Termination & separation process
- Written warning process documented
- Full & final settlement within the legal period
- Exit interview + clearance checklist completed
- Gratuity/benefit calculations per law
9. Grievance handling
- Written grievance policy available to staff
- Named grievance officer
- A complaint register with dates and resolutions
10. Documentation storage
- Every record above in one folder structure (physical + digital)
- Backups (cloud or external drive)
- Retention: keep payroll and contract records at least the statutory period
Download the full checklist
I have packed this into a printable one-page checklist — get it free from the Resources page. Run it once a quarter and you will walk into any audit prepared.