Systems Audit of Mutual Funds
Summary
The circular mandates that mutual funds must undergo a systems audit conducted by an independent auditor with CISA, CISM, or equivalent qualifications. This comprehensive audit must occur once every two years and cover critical areas such as front-office integration, fund accounting, and regulatory compliance. The resulting report and compliance status must be presented to the Trustees and communicated to SEBI.
Text
mutual funds shall have a systems audit conducted by an independent CISA/CISM qualified or equivalent auditor
systems audit should be comprehensive encompassing audit of systems and processes inter alia related to examination of integration of front office system with the back office system, fund accounting system for calculation of net asset values, financial accounting and reporting system for the AMC, Unit-holder administration and servicing systems for customer service, funds flow process, system processes for meeting regulatory requirements, prudential investment limits and access rights to systems interface
get the above systems audit conducted once in two years... place the Systems Audit Report and compliance status before the Trustees of the mutual fund. The systems audit report/findings alongwith trustee comments should be communicated to SEBI
For the financial years April 2008 – March 2010, the systems audit should be completed by September 30, 2010
issued in exercise of the powers conferred by Section 11(1) of Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 77 of the SEBI (Mutual Funds) Regulations, 1996
Source: SecMarx — Systems Audit of Mutual Funds. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.