1) Government of Nepal shall form a Standard on Auditing Board in order to systematize and  regulate the accountancy and auditing.
(2) The Standards on Auditing Board shall consist of the following members:
(a) One person nominated by Government of Nepal from amongst the fellow  -Chairperson  chartered accountants
(b) Representative, Ministry of Finance -Member
(c) Representative, Office of Auditor General -Member
(d) Three persons nominated by Government of Nepal from amongst the  chartered accountants, upon the recommendation of the Council -Member
(e) One person nominated by Government of Nepal from amongst the registered auditors, upon the recommendation of   the Council -Member
(3) The Standards on Auditing Board may, if it deems so necessary, invite any concerned expert to attend its meeting as an observer.
(4) The term of office of the members mentioned in Clauses (a), (d) and (e) of Sub-section (2) shall be Three years, and they may, on the expiry
of their term, be re-appointed or nominated.
(5) The Rules of procedures relating to the meeting of the Standards on Auditing Board shall be as determined by the Board itself.
(6) The secretariat of the Standards on Auditing Board shall be situated in the Head Office of the Institute.