Vide recent circular dated April 18, 2024, the Securities and Exchange Board of India (SEBI) mandates Alternative investment Funds (AIFs) to carry out an annual audit with the PPM and submit the audit report to the Trustee, Board of Directors and the Designated Partners of the AIF and SEBI within six months from the end of the financial year.
To ensure uniform compliance standards and ease of reporting, SEBI has prepared a standard reporting format for PPM audit reports in consultation with Standard Setting Forum (SFA), which shall be available on the websites of AIF Associations, which are a part of SFA. The Associations will assist all AIFs in clarifying or resolving any issues that may arise, to ensure timely and accurate reporting.
The PPM audit reports shall be submitted to SEBI by AIFs online on the SEBI Intermediary Portal (SI Portal) as per the aforesaid format and all other provisions with respect to filing of the PPM audit report specified in the Master Circular dated July 31, 2023 shall remain unchanged. However, the audit of sections of PPM relating to 'Risk Factors', 'Legal, Regulatory and Tax Considerations', and 'Track Record of First Time Managers' shall be optional. Additionally, 'Illustration of Fees and Expenses' and 'Glossary and Terms' shall also be optional.
The reporting requirement mentioned in the above mentioned recent circular shall be applicable for PPM audit reports to be filed for the financial year ending March 31, 2024, onwards. To keep pace with the fast-changing landscape of the AIF industry and for policy and supervision purposes, the aforesaid reporting format shall be reviewed periodically by the SFA in consultation with SEBI. In case of any revisions in the reporting format, the revised format shall be made available on the websites of the Associations which are part of SFA.
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