In order to bring uniformity, capital markets regulator Sebi on Wednesday decided to standardise the way portfolio managers audit the firm-level performance data on an annual basis, according to a circular.Under the rule, portfolio managers are required to submit audit reports on firm-level performance data to Sebi within 60 days from the end of each financial year.They are required to consider all clients’ portfolios managed — clients of both discretionary and non-discretionary portfolio management services — for the purpose of audit of firm-level performance data.
In its circular, the regulator said that the Association of Portfolio Managers in India (APMI), in consultation with Sebi, will specify standardised Terms of Reference (ToR) for the audit of firm-level performance data.The standard ToR will include a requirement for portfolio managers to consider clients’ portfolios under all services for the audit of firm-level performance data.However, the performance of advisory clients can be excluded only if the performance of such clients, either individually or cumulatively, is not reported or published in any marketing material or website.
This report on confirmation of compliance to Sebi needs to be certified by directors or partners of the portfolio manager or by any person authorised by them.