SETTING THE BAR HIGH

practice of due diligence done by merchant bankers and other reporting requirements to SEBI. It may be good to consolidate the audit and certification requirements into one intermediary,” said Yashesh Ashar, Partner, Illume Advisory.

The AIF’s PPM has to be certified by a merchant banker and trustee even if the PPM is in SEBI prescribed format. The PPM has to be again annually updated even for changes which are not regulatorily prescribed such as updation of disciplinary actions or class of units.

“The same PPM needs to be annually audited and now uploaded in an excel format. Further, there is an annual Compliance Test Report which needs to be submitted to the sponsors and trustees within 30 days from the end of financial year, notifying exceptions to compliance which

AIFs to submit quarterly reports on their activity

Consolidated reporting of any changes to the PPM

Annual audit report detailing findings and corrective steps on PPM compliance

Periodic reporting of leverage employed

Immediate report on violation of AIF regulations, decision to suspend redemptions, systemic risks includes compliances of PPM as well,” said Leelavathi Naidu, Partner, IC Universal Legal. “All these could be merged into one requirement with certain breather in timelines and eased out for better monitoring.”

ONUS ON MANAGERS

The new amendment mandating obligations on the manager and KMPs to conduct due diligence of the investors puts an additional layer of obligation that goes beyond the KYC mandates under KRA/CKYC or PMLA laws. “The managers will no longer be able to rely on representations from investors to their eligibility of investing