This paper aims at disseminating knowledge about the evolution of expenditure accounting in the government of Nepal. In doing so, the paper examines emerging ideas in the aftermath of the political change of 1951 in Nepal, and traces the processes of development and institutionalization of expenditure accounting during the course of two decades, the 1950s and early 1960s, with particular reference to the institutional forces at work. An interesting feature of Nepalese accounting reforms before and after the political change was the active participation of India, the United Nations, and the U.S. Agency for International Development (USAID). At the outset of the post-Rana period, Indian advisors dominated the reform process and helped Nepal introduce and incorporate a range of modern administrative measures, including a new budgeting structure called line-item budgeting. The external influence on Nepal's reforms and the ways of installing new values in the administration altered in the second half of the 1950s. The United Nations and the USAID became the major agents in the introduction and institutionalization of rules and practices, especially accounting norms and procedures.
