SEBI Unveils New Framework for ‘System Audit of Professional Clearing Members’

Circular No. SEBI/HO/MRD/TPD/P/CIR/2024/84; Dated: 20.06.2024

SEBI has established a new framework for the system audit of professional clearing members (PCMs). As per the framework, PCMs must submit information regarding major and minor non-compliances observed in the system audit in the prescribed format.

Further, PCMs must maintain a list of all relevant SEBI and clearing corporations (CCs) circulars and directions regarding technology and compliance in the prescribed format. The formats are attached as an annexure to the circular. The framework shall be effective immediately, and the first audit must be conducted for FY 2023-24.

Also, the Systems Audit report, including compliance with SEBI/CCs circulars/guidelines and exceptional observation format along with compliance status of previous year observations, must be placed before the Governing Board of the PCM. Subsequently, the report, along with the comments of the management of the PCM, must be communicated to CCs within one month of the completion of the audit.

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