On Apr. 24, 2025, IND NSE issued circular reminding all PCMs must submit their system audit report for the financial year ending Mar. 31, 2025, by Jun. 30, 2025.
Document dated Apr. 24, 2025, received from IND NSE May 1, summarized May 5.
On Jun. 20, IND SEBI issued system audit framework for PCMs.
IND SEBI issued framework on system audit of professional clearing members (PCMs).
Follows IND SEBI Oct. 2023 issued master circular for stock exchanges, see #188261.
Requirements
PCMs shall conduct system audit as per the framework and terms of reference (TOR).
TOR covers IT resources, IT governance, business control as well as vendor selection.
Maintain a list of all the relevant circulars/ directions/ advice, pertaining to technology and compliance thereof, as per format in annexure 3; included under scope of audit.
Report exceptional major non-compliances (NCs) or minor NCs observed in the audit.
Categorically highlight those observations/NCs/suggestions pointed out in the audit.
The system audit report including compliance with relevant circulars/guidelines and exceptional observation and compliance status of previous year observations shall be placed before the governing board of the PCM for comments.
Then the report along with the comments of the PCM's management shall be communicated to clearing corporations (CCs) within one month of completion of audit.
Effectiveness
The circular is effective immediately from Jun. 20, 2024.
Jul. 2024 IND NSE Audit Report
On Jul. 11, 2024, IND NSE said timeline for system audit report for FY 2023-24 was extended; audit report should be submitted by PCMs to CCs by Sep. 30, 2024.
Starting from FY 2024-25, submission deadlines will align with IND SEBI's circular.
Document dated Jul. 11, 2024, received from IND NSE Jul. 15, summarized Jul. 16.
Jul. 15, 2024 IND ICCL Audit Report
On Jul. 15, 2024, IND ICCL informed PCMs re SEBI's timeline extension for submission of system audit report for FY 2023-24 to Aug. 31, 2024; audit report for FY 2023-24 shall be submitted by PCMs to ICCL by Sep. 30, 2024 after governing board approval.
Starting from FY 2024-25, submission deadlines will align with IND SEBI's circular.
Aug. 2024 IND ICCL Penalty Structure
On Aug. 16, 2024, IND ICCL established a uniform penalty structure for several items; will apply to system audit reports submitted for the fiscal year 2023-24 and onwards.
The structure applies to non-submission of system audit report within the due date.
Imposition of penalties, disciplinary actions, or charges for any non-compliance or unresolved issues highlighted in system audit report; specific penalties for each level of risk associated with non-compliances that are not resolved within six months.
Document dated Aug. 16, 2024, received from ICCL Aug. 20, summarized Aug. 22.
Apr. 2025 IND NSE Submission Reminder
On Apr. 24, 2025, IND NSE issued circular reminding all PCMs must submit their system audit report for the financial year ending Mar. 31, 2025, by Jun. 30, 2025.
Document dated Apr. 24, 2025, received from IND NSE May 1, summarized May 5.
