Continuous disclosures and compliances by listed entities under SEBI Issue and Listing of Municipal Debt Securities Regulations, 2015
Summary
This circular amends the SEBI (Issue and Listing of Municipal Debt Securities) Regulations, 2015 to update continuous disclosure requirements for listed municipal debt issuers. It introduces specific timelines for submitting half-yearly and annual financial results, including a two-step audit process for entities audited by the CAG. Additionally, it mandates the creation of escrow accounts for payment obligations and requires periodic reporting on fund utilization and project implementation status.
Text
The listed entities shall prepare and submit half yearly un-audited financial results to the stock exchange as soon as the same are available but within forty five days of the end of the first half year.
The listed entities shall submit annual audited financial results for the financial year, within sixty days from the end of the financial year along with the audit report.
Listed entities audited by CAG may adopt a two-step process: initial submission within sixty days by appointed auditor, and final submission within nine months after approval by Standing Committee/Board.
The half yearly un-audited financial results and annual audited financial results shall contain comparative information for the immediately preceding corresponding half year or financial year respectively.
The half yearly un-audited financial results and annual audited financial results submitted to the Stock exchange(s) shall be taken on record by Standing Committee or General Body or Board of Directors or Board of Trustee, as applicable or equivalent.
The listed entities shall disclose debt equity ratio, debt service coverage ratio, interest service coverage ratio etc along with the half yearly and annual financial results.
The annual report shall contain balance sheet, income and expenditure account, statement of cash flows, receipts and payments accounts, notes to Account, financial performance indicators, Auditor’s report, Municipal commissioner's report, and Standing committee's action taken report.
any material adverse changes affecting ability to service municipal debt securities
The listed entities shall submit a certificate to the stock exchange(s) intimating the status of payment of interest or principal or both within five working days of the same becoming due in respect of municipal debt securities.
Every credit rating shall be reviewed at least once a year, by a registered credit rating agency.
In the event of credit rating being downgraded by two or more notches below the rating assigned at the time of issue, the listed entities shall disclose the reasons for downgrade in rating and the steps, if any, it intends to take to recover the rating.
Any change in credit rating shall be promptly disseminated on the Stock exchange(s) where such securities are listed.
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Source: SecMarx — Continuous disclosures and compliances by listed entities under SEBI Issue and Listing of Municipal Debt Securities Regulations, 2015. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.