|
Internal Audit for
Stock Brokers / Trading Members / Clearing Members
This is further to our circular No. MCX-SX/LEG/23/2008 dated
October 24, 2008 and SEBI letter No. MIRSD/DPS-I/PG/158174/09 dated March 23,
2009 on the subject. All the trading members / clearing members, who have
traded / cleared at least one trade, are required to conduct half yearly internal
audit for the period October 1, 2008 to March 31, 2009 onwards.
Members may appoint independent qualified Chartered
Accountants, Company Secretaries or Cost and Management Accountants who are in
practice and who do not have any conflict of interest, on their own for the
purpose of conducting the audit.
Upon completion of the audit, a report is to be submitted by
the auditor to the member, which shall contain a certificate of the auditor in
the form prescribed in Annexure - 1
and the findings made during the audit. The scope of the audit is given in Annexure – 2 and some of the important
features to be addressed in the report are given in Annexure – 3.
The report shall be discussed by the management of the
member (in the Board Meeting, in respect of a corporate member) internally and
point-wise comment of the management and status of compliance shall be sent
along with the audit report to the Exchange within three months from the end of
the relevant half year. Accordingly, the first such report along with the
member’s comments shall reach the Exchange latest by June 30, 2009. The
Exchange shall scrutinize the same and decide on the action to be taken.
Non-submission of the internal audit report as per the
Exchange’s guidelines shall be treated as non-compliance with the requirement
to submit such report and disciplinary action will be initiated against the
concerned members. Where, in the opinion of the Exchange, the quality of the
reporting is not satisfactory or the audit is not carried out in accordance
with the Exchange’s guidelines, the Exchange reserves the right to advise the
concerned members to change the auditors and submit revised reports.
Members are advised to take note of the above and comply
with the requirement.
Vandana D. Vania
Manager
For any
clarifications contact Ms. Leena Ranade on 022–67318933, Ms. Yugandhara Patil on 022-67318921, Mr. Rushabh Mutha on
022-67318937 or send an email at
customerservice@mcx-sx.com.
Annexure - 1
CERTIFICATE FOR INTERNAL AUDIT
We have examined the relevant books of accounts, records
and documents maintained by M/s. _______________, (name of the trading/clearing
member) bearing SEBI registration number ______________________) a member of
the National Stock Exchange of India Limited / Bombay Stock Exchange Ltd. /
MCX-Stock Exchange /other Stock Exchange, for the following segments to fulfill
the internal audit requirement as prescribed by SEBI vide circulars dated
August 22, 2008 & October 21, 2008, for the half year
ended_____________________.
|
Segments
(Cash
Segment/Derivatives Segment / Debt Segment /Currency Derivatives/Securities
Lending & Borrowing segment)
|
Activity
(Trading/Clearing/Trading and Clearing)
|
SEBI
registration number
|
|
|
|
|
The
purpose of this audit is to examine that the processes, procedures followed and
the operations carried out by the Trading Member/Clearing Member are as per the
applicable Acts, Rules, Regulations, Bye-laws and Circulars prescribed by SEBI
and the Stock Exchange.
We
have obtained all the information and explanations, which to the best of our
knowledge and belief were necessary for the purpose of this internal audit. In
our opinion proper books of accounts, records & documents, as per the
regulatory requirement have been maintained by the member, so far as it appears
from examination of the books.
We
have conducted the audit within the framework provided by SEBI/Stock Exchange
for the purpose of this internal audit.
To
the best of our knowledge and belief and according to the information and
explanations given to us, no material fraud / non-compliance /violation by the
member is observed during the course of this audit.
Based
on the scrutiny of relevant books of accounts, records and documents, we certify
that the member has complied with the relevant provisions of SEBI Act, 1992,
Securities Contracts (Regulation) Act 1956, SEBI (Stock Brokers and
Sub-Brokers) Regulations, 1992 and various circulars of SEBI. The member has
complied with the Rules, Bye-laws,
Regulations of NSE / BSE / MCX-SE and various circulars issued by the Stock
Exchange and Clearing Corporation/Clearing House.
We
declare that we do not have any direct / indirect interest in or relationship
with the member or its directors / partners / proprietors / management and also
confirm that we do not perceive any conflict of interest in such relationship /
interest while conducting internal audit of the member.
In
our opinion and to the best of our information and according to the
explanations given to us by the proprietor/partne(s)/director(s)/compliance
officer, the Report provided by us as per the Annexure and subject to our
observations, which covers the entire
scope of the audit, is true and correct.
__________________
Company
Secretary / Cost and Management Accountant / Chartered Accountant
(Seal
& Signature)
(Name
of the Proprietor / Partner)
Membership
no. / CP. No.
Place:-
Date:-
Annexure – 2
SCOPE OF THE AUDIT
& AREAS TO BE COVERED
|
1. Client
registration and documentation
|
|
|
Execution of KYC, MCA/TPA, and RDD – checks and balances
in place
|
Whether KYC, MCA/TPA, RDD are executed in the prescribed
formats & the same is executed
before execution of trades for the client?
Whether all fields in KYC including client’s financial details
are filled in properly?
Whether proper proof of identity, PAN and proof of address
are taken with KYC form?
Whether any contravening clauses are included in
MCA/TPA?
Whether in person verification of clients is done by the
employees of the trading member only?
Whether date of verification, name and signature of the
official who has done in-person verification and the member’s stamp
incorporated in the client registration form?
Whether copies of all the documents executed by client are
given to the respective clients?
Whether UCC is allotted to the client & the same is
uploaded to the Exchange with PAN
Whether change in address, bank account or demat account
is carried out on receipt of written request along with documentary proof
from the respective client?
|
|
Verification of formats of KYC, MCA/TPA and RDD and
attachments including proof of identity and address, as prescribed by SEBI
|
|
Verification that Contradictory clauses are not mentioned
in KYC, MCA/TPA and RDD
|
|
Systems and procedures put in place by member for
verification of PAN before opening account
|
|
Procedure followed by the member for informing UCC to the
clients & uploading to the Exchange
|
|
Mechanism to ensure financial details of clients
|
|
Procedure adopted for in person verification of clients
|
|
Procedure adopted by relationship managers, if any, for
procuring new clients
|
|
Delivery of copies of client registration documents to the
clients
|
|
Storage of client registration documents and retrieval
mechanism
|
|
Procedure adopted for obtaining clients’ consent for
electronic contract notes
|
|
Acquaintance procedure for new clients
|
|
Exchange Circular No. MCX-SX/MEM/4/2008 dated October 4,
2008
Exchange Circular No. MCX-SX/COMP/56/2009, January 27,
2009
Exchange Circular No.
MCX-SX/COMP/54/2009 dated January 27, 2009
MCX-SX Regulation No. 3.13 for
PAN collection, verification
MCX-SX Regulation No. 4.3.2 for
assessing client, its background, financial standing etc
|
|
2. Order management
and risk management systems
|
|
|
Procedure adopted for receipt of orders from clients
|
Whether checks are in place to ensure that no unauthorized
orders are executed from any of the terminals?
Whether control reports like orders executed away from
market price, client-wise / scrip-wise / terminal-wise volumes / exposures
are generated to monitor any manipulation or unwarranted activity?
In case of dormant accounts, are there any checks in place
to ensure that in case the account is reactivated whether it is operated by
the respective client only?
Whether initial and other margins are collected from
respective clients in the prescribed form of funds, fixed deposit receipts,
bank guarantees and approved securities with appropriate haircut?
Whether the member has a proper system for reporting the
correct client margin collection, in Currency Derivatives segment?
Verify whether the margin reported by the member to the
Exchange in Currency Derivatives
segment is actually collected and available in the books of accounts of the
member. In case of any irregularity observed, mention the instances wherein
wrong reporting of margin collected from clients/trading members was
observed.
Whether Risk Management System (RMS) includes policy on
margin collection from clients/trading member
and the RMS is documented?
Whether proper systems are in place to ensure timely
collection for pay-in from the respective client as per settlement schedule?
Whether proper monitoring mechanism is in place to review
long outstanding debit balances in clients’ accounts and recovery of the
same?
|
|
Mechanism for order management and execution
|
|
Procedure adopted for setting Limits at client level /
Terminal level/Dealer level
|
|
Policy on Margin collection mechanism and the modes of
margin money
|
|
Procedure adopted for reporting of client margin
collection to Clearing House / Corporation
|
|
Review of process adopted for monitoring / recovery
of long outstanding debit balances
|
|
MCX-SX Regulation 15.1 for Keeping Records, Annual
Accounts & Audit
Exchange Circular No. MCX-SX/C&S/7/2008 dated October
4, 2008
Exchange Circular No. MCX-SX/INSP/34/2008 dated November
24, 2008
|
|
3. Contract notes,
Client margin details and Statement of accounts
|
|
|
Procedure adopted for issuance of contract notes
|
Whether contract notes are sent within 24 hours of
execution of trades and margin details are sent daily to
respective clients and proof of delivery / dispatch is maintained?
Whether all prescribed details including name and
signature of authorised signatory, dealing office details and brokerage are contained
in contract note?
In case contract notes and margin details are sent in
electronic form, whether log is maintained? Whether trail of bounced mails is
maintained and physical delivery is ensured in case of bounce mails?
Whether member has complied with regulatory requirements
related to Electronic Contract Notes(ECN)?
Whether complete statement of accounts for funds and
securities are issued on a quarterly basis to clients, with error reporting
clause? Whether proof of sending the same is maintained?
|
|
Verification of format of contract notes issued
|
|
Verification of copy of contract note with Proof of
dispatch/register of dispatch/logs maintained
|
|
Adherence to electronic contract note norms, if applicable
|
|
Procedure adopted for sending statement of accounts
|
|
Contents & periodicity of statement of accounts of
funds and securities
|
|
Procedure adopted for sending margin details to clients
|
|
Procedure for maintaining acknowledgement / proof of
delivery of contract notes/statement of accounts/margin details to the
clients
|
|
MCX-SX Regulation 3.6 for Contract Notes
Exchange Circular No. MCX-SX/MEM/4/2008 dated October 4,
2008
Exchange Circular No. MCX-SX/COMP/54/2009 dated January
27, 2009
Regulation 15.1.6.1 (c), Exchange Circular No.
MCX-SX/COMP/53/2009 dated January 27, 2009
Exchange Circular No. MCX-SX/INSP/34/2008 Dated November
24, 2008
|
|
4. Dealing with
clients’ funds and securities
|
|
|
Verification of details of cash receipts from / payments
to clients, if any, observed during the audit period are to be given
(mentioning any specific branch involved).
|
Whether cash dealings with clients are done by Member / Branches?
Whether banker’s cheque / demand draft are accompanied
with written request from the respective client?
Whether pay-in or pay-out is received from or delivered to
respective clients only?
Whether any instances were observed wherein pay-in / pay
out was received from / made to account other than the respective client
account? Whether there are any systems in place to ensure compliance
in this regard by the member?
Whether clients’ securities were provided to clearing
house / clearing corporation for margin / exposure.
If so, whether the benefit was passed on to the respective
clients only.
Whether collaterals of clients were pledged with banks /
other entities for raising funds? If yes, details of such instances observed
are to be given.
Whether funds raised by pledging client securities were
utilised for respective client only? List of instances to be provided in case
of non-utilisation of proceeds for respective client?
Whether client’s funds / securities are transferred to
respective clients accounts within 24 hours of declaration of pay-out?
Whether any instance of misutilisation of clients’ funds
or securities is observed? If yes, give complete details of such instances
Whether bank book and register of securities are in
alignment with bank statements and transaction statements provided by banks
and depositories?
Whether dividend and other corporate benefits received on
behalf of clients is paid/credited/passed on to the respective clients
account?
|
|
Verification of internal controls adopted by the member
while accepting banker’s cheque / demand draft from clients
|
|
Procedure for ensuring that receipts and payment of
funds/securities are from/to respective client only
|
|
Periodic Reconciliation of books of accounts
|
|
Verification of following books of accounts/records
-
Register of Securities
-
Bank Statements
-
Depository accounts maintained by member (if applicable)
-
Client ledgers
-
Cash Book
-
Bank Book
-
Details of records of client securities, if any.
-
Underlying for any overdraft/loan account.
|
|
Exchange Circular No.
MCX-SX/COMP/53/2009 dated January 27, 2009
Exchange Circular No. MCX-SX/INSP/34/2008 dated November
24, 2008
MCX-SX Regulation No. 4.4.16 (1) - payment of funds in 24
hours
|
|
5. Banking and Demat
account operations
|
|
|
Procedure for segregation of own and clients’ funds and
securities (in separate accounts)
|
Whether Member maintains separate bank accounts for clients
funds & own funds. Also, whether Member maintains separate beneficiary
accounts for clients’ securities & own securities?
Whether clients funds and securities are segregated from
own funds and securities?
Are there any instances of use of client beneficiary account or client bank account for
unauthorised purposes? In case of any irregularity observed, mention the
instances in detail.
|
|
Internal controls for use of client bank and client beneficiary accounts only for
authorized purposes.
|
|
Exchange Circular No.
MCX-SX/INSP/34/2008 dated November 24, 2008
MCX-SX Regulation 15.1.6.1 (b)
MCX-SX Regulation 15.1.6.2
|
|
6. Terminal
operations and systems
|
|
|
Procedure and policy adopted by member before allotment of
trading terminals
|
Whether terminals are provided by the member in his head
office, branch office?
Whether any unauthorized terminal is observed to be
allotted? If yes, give complete details.
Whether periodic audit of systems and software is
conducted by certified systems auditor?
Whether terminals are operated by approved
persons/approved users with valid certification?
Whether correct User name, login id, terminal location are
reported to the Exchange?
Whether internal controls are in place to ensure that the
certification of approved users has not expired?
Whether prior permission is obtained by member for
providing CTCL? Whether member has
complied with applicable provision of CTCL?
Whether updated version of software is used?
Whether back up facilities are in place and followed?
Whether broker has got his system audit done &
submitted the system audit report to the Exchange within prescribed time
limit?
|
|
Verification of terminals and its users, at the audit
place.
|
|
Verification of certification of the approved users.
|
|
Due diligence adopted for password security
|
|
Procedure in place for audit of systems and software
|
|
Periodic updating of version and back up mechanism
|
|
System adopted for data storage, security and access
|
|
Verification of logs from server
|
|
MCX-SX/T&S/2/2008 dated
October 4, 2008
MCX-SX/CTCL/8/2008 dated
October 4, 2008
MCX-SX/MEM/31/2008 dated
November 21,2008
|
|
7. Management of
branches and internal control
|
|
|
System and Policy followed for opening / closing of
branches
|
Whether survey is conducted by the member for opening /
closing of branches?
In case of closure, whether advance notice of the same is
sent to clients? Proof of the same.
Whether there is monitoring mechanism to identify sudden
increase / decrease in client level turnover from any specific branch?
Whether periodic inspection of branch is conducted and
reports are maintained? What is the follow-up mechanism?
Whether intermediation is observed?
Whether the member has shared commission/brokerage with
entities with whom trading members are forbidden to do business / another
trading member / employee in the employment of another trading member?
Whether internal controls exists and are sufficient to
cover the risks at the members end?
Whether Stock broker indemnity insurance policy with
standard cover/clauses has been taken?
|
|
Procedure adopted to inform the same to clients
|
|
Periodicity and procedure adopted for inspection of
branches
|
|
Reporting mechanism and mode of informing the inspection
observations to branches
|
|
Follow up action plan
|
|
Policy of fixing of roles and responsibilities of
officials in head office, branch offices
|
|
Process laid out so as to prevent intermediation
|
|
Documentation of Internal controls and
Comments on Internal controls in place
|
|
Verification of Stock broker indemnity insurance policy
|
|
Sharing of commission/brokerage
|
|
Circular No. MCX-SX/LEG/23/2008
dated October 24, 2008
Circular No. MCX-SX/MEM/33/2008
dated November 24, 2008
MCX-SX Regulation No. 4.2.1
MCX-SX Byelaw 33(a) (i) of
Chapter 11 for internal control
|
|
8. Investor
grievance handling
|
|
|
Mechanism to monitor complaints lodged with Member /
Branch
|
What is the system to report complaints received by
branches to the head office?
Whether complaints are received from specific branch?
Whether complaints register includes complete details of
investor complaints?
What is the procedure adopted to resolve complaints?
Whether specific action plan is framed by the member in
respect of long pending complaints?
Whether designated
email id for investor
grievances is created and informed to the investors ?
What is the periodicity of monitoring investor complaints?
Whether complaints of substantial amount is escalated to
the top management ?
|
|
Maintenance of complaints register
|
|
Redressal mechanism for complaints registered against the
member
|
|
Comment on complaints pending for long period
|
|
Verification of investor grievance register and email id
|
|
Internal control for verification of complaints received
through the designated email –id
|
|
Exchange Circular No. MCX-SX/COMP/53/2009 dated January
27, 2009
MCX-SX Regulation No. 15.1.16 for maintenance of investor
complaints records / register
|
|
9. Maintenance of
Books of Accounts
|
|
|
Prescribed books of accounts, registers and records are
maintained Exchange wise, with the required details and for the stipulated
period as per regulatory requirement
|
Whether prescribed books of accounts, registers and
records are maintained Exchange wise, with the required details and for the
stipulated period as per regulatory requirement?
Whether exchange wise separate books of accounts are
maintained?
Whether member has dealt with any suspended /defaulter
/expelled member and/or prohibited entity?
Whether prior approval has been obtained by member for
change in shareholding /directors/constitution?
Whether prior approval has been obtained in case the
member has dealt with another member of the Exchange?
Whether member has intimated the Exchange in case of they
have dealt with member of another stock exchange?
Whether advertisements are issued after prior permission
of the Exchange?
Whether member maintains and updates client master in its
back office?
Whether financial reports of the member has been analysed?
Comments on the same.
|
|
Verification of books of accounts and other records
|
|
|
|
Internal controls on the process for taking approval of
the Exchange
Analysis of financial reports
|
|
MCX-SX Regulation 15.1.3 for segregation of exchange-wise
books of accounts
MCX-SX Regulation 15.1.4 for maintenance of documents
MCX-SX Regulation 15.1.4 (g) for maintenance of documents
MCX-SX Regulation 15.1.5
for maintenance of documents
MCX-SX Regulation 15.1.6.1(a) for maintenance of documents
MCX-SX Regulation 15.1.13
for maintenance of documents
MCX-SX Regulation No. 2.1.16 – prior approval for dealing
with another member of the exchange
Exchange Circular No. MCX-SX/MEM/30/2008 dated November
19, 2008
|
|
10. Systems &
Procedures pertaining to Prevention of Money Laundering Act (PMLA), 2002
|
|
|
Customer acceptance policy and customer due diligence
measures
|
What is the process adopted by member to verify the
identity of the customer and/or the person on whose behalf a transaction is
being conducted ?
Whether any account was opened in fictitious name/benami
account ?
What checks and balances are in place to ensure that the
identity of the client does not match with any person having criminal
background or is not banned in any other manner?
What are the factors of Risk perception having regard to
client's location, address, nature of business activity, trading turnover and
the manner of making payments so that the clients can be classified in to
"High Risk", " Medium Risk"," Low Risk"
category?
Whether details of appointment of Principal Officer and
change in Principal officer, if any is intimated to FIU-India?
Whether member has adopted and implemented written
guidelines prescribed under PMLA, 2002?
Whether member has adequate system to generate alerts for
suspicious transactions?
As per provisions of Prevention of Money Laundering Act,
2002 whether record of transactions, its nature and its value are maintained?
|
|
Walk through of the process
|
|
Process of generation and monitoring alerts
|
|
System in place that allows continuous monitoring of
transactions
|
|
Process for identifying STR (Suspicious Transaction
Report) and reporting the same to FIU-India.
|
|
Processes for verification of alerts with KYC details
|
|
Exchange Circular No.
MCX-SX/COMP/64/2009 dated February 19, 2009,
|
|
11. Transfer of
trades
|
|
|
Transfer of trades in the back office
|
Whether any trades were transferred from one client code
to another client code or from client code to pro or vice-versa in the back office of the member?
Whether any pattern was observed in case, transfer trades
carried out at member’s back office
|
|
Verification of trade files downloaded by the Exchange
with sauda register/back-office file of member (based on which contract notes
are generated)
|
|
Internal controls for transfer of trades
|
|
MCX-SX Regulation No. 3.6
|
|
12. Proprietary
Trading
|
|
|
Verification of
user ids enabled for trades on PRO A/c
|
If member is doing pro trading, whether member has
disclosed this information to his clients?
If member is doing pro trading from multiple locations,
whether member has obtained prior approval from the Exchange in this regard?
|
|
Process for approval of Exchange
|
|
Exchange Circular No.
MCX-SX/COMP/53/2009 dated January 27, 2009
MCX-SX Regulation No. 4.5.3 (k)
– prior approval for PRO trading at multiple locations
|
|
13. Internet Trading
|
|
|
Process of approval from Exchange
|
Whether member has obtained specific approval from the
exchange, in case he is providing internet trading facility to his clients?
|
|
Verification of internet agreements
|
|
Procedure followed for user id and password
|
Whether member has complied with regulatory requirements
related to internet trading?
|
|
Internal controls for internet trading
|
Whether Member has got his system audit done &
submitted the system audit report to the Exchange within prescribed time
limit?
|
|
Exchange Circular No.
MCX-SX/COMP/57/2009, January 29, 2009
|
|
14. Operations of
Professional Clearing member/ Members
clearing trades of other trading members
|
|
|
Verification of execution of trading -clearing member
(TM-CM) agreements/Clearing Member’s Participant agreements
|
Whether TM-CM agreements are executed in prescribed
formats with trading member?
|
|
Verification of issuance of statement of accounts to
trading members/ clearing member’s participants
|
Whether Clearing member - clearing member’s participant
agreements are executed in prescribed formats ?
|
|
|
Whether statement of accounts has been sent to trading
member/clearing member’s participants?
|
|
|
Whether clearing members had collected appropriate and adequate
margins in prescribed forms from respective trading members/ clearing
member’s participants?
|
|
|
Whether Margin collection reported to Exchange is in
accordance with margins actually collected from trading member/clearing
member’s participant ?
|
|
|
Whether exposure allowed to trading members / clearing
member’s participants were based on requisite margins available with the
clearing member?
|
|
|
Whether interest is charged to the trading member /
clearing member’s participants? If yes, what is the basis of interest with
complete details like percentage of interest, periodicity of interest charged
|
|
MCX-SX/C&S/48/2009 dated
January 9, 2009
Exchange Circular No.
MCX-SX/C&S/7/2008 dated October 4, 2008
Exchange Circular No.
MCX-SX/INSP/34/2008 dated November 24, 2008
|
Annexure - 3
Some important features to be addressed
in the Internal Audit report
The
purpose of audit should be
(a)
to ensure that the books of account, records and
documents are being maintained in the manner required under Securities Exchange
Board of India Act, 1992, Securities Contracts (Regulation) Act, 1956, SEBI
(Stock brokers and Sub-brokers) Regulations, 1992, Securities Contracts
(Regulation) Rules, 1957, circulars issued by SEBI, agreements, Bye laws of the
Exchanges, data security and insurance
in respect of operations of trading member/clearing members
(b)
to ascertain whether adequate internal control
systems, procedures and safeguards have been established and are being followed
by the intermediary to fulfill its obligations under Securities and Exchange
Board of India Act, 1992, Securities Contracts (Regulation) Act, 1956, SEBI
(Stock brokers and Sub-brokers) Regulations, 1992, Securities Contracts
(Regulation) Rules, 1957, circulars issued by SEBI, agreements, Bye laws of the
Exchanges, data security and insurance
in respect of operations of trading member/clearing members.
(c)
to ascertain whether any circumstances exist which
would render the intermediary unfit or ineligible for dealing in securities
market.
(d)
to ascertain whether the provisions of the securities
laws and the directions and/or circulars issued there under by SEBI/Exchanges
are being complied with
(e)
to ascertain, whether the provision of stock
exchange, Bye-laws, notices, circulars, instructions or orders issued by stock
exchanges are being complied with
(f)
to inquire suo
motu into such matters as may be deemed fit by the auditor in the interest of investors or the
securities market
Accordingly,
the auditor shall not restrict to the scope of the audit as given in Annexure
2, which is only indicative. The auditor shall update the scope of the audit
based on all regulatory requirements as specified from time to time. Further,
the auditor shall consider the following while making the report.
1.
If any major
significant deviations and deviations of recurring nature are observed, the
same should be reported separately in the covering page of the audit report.
2.
If auditor’s
observations are in the nature of a deviation or a recommendation, the member’s
response should be sought and recorded in the report.
3.
Comments by
auditor on the status of compliance in respect of deviations reported in the
last audit report, on which the member assured to take necessary action.
4.
Improvements
brought about in the operations between the last audit and the current audit.
5.
In case the
member has been inspected in the relevant half year by the Exchange / SEBI,
comments by the auditor on whether the member has complied with the
observations made in the inspection report are to be included in the audit
report.
6.
A statement by
the auditor that the provisions of SCRA 1956, SEBI Act 1992, SEBI (Stock
Brokers and Sub-Brokers) Regulations 1992, Rules, Bye-Laws, Regulations and
circulars of SEBI, Exchange and Clearing Corporation, have been covered in the
audit.
7.
A statement by
the auditor that the auditor is neither related to officials of the member nor
having any interest in the management of the member.
8.
Auditor’s
membership number should be mentioned at the end of the report.
|
