Quick summary
SEBI has officially clarified that members of the Institute of Cost Accountants of India (ICMAI) are eligible to conduct the annual compliance audit for Investment Advisers. This update amends the Master Circular for Investment Advisers to include Cost Accountants alongside Chartered Accountants and Company Secretaries as authorized auditors.
Who is affected
- All registered Investment Advisers (IAs).
- Members of the Institute of Cost Accountants of India.
- Investment Advisers Administration and Supervisory Body (IAASB).
What changes
- Audit Eligibility: Members of the Institute of Cost Accountants of India are now explicitly recognized to conduct annual audits regarding compliance with IA Regulations.
- Certification: IAs must now maintain an annual certificate from a member of ICAI, ICSI, or ICMAI confirming compliance with client-level segregation requirements (Regulation 22). This certificate must be obtained within six months of the financial year-end and form part of the compliance audit.
Action items
- Update internal compliance protocols to reflect that annual audits and client-level segregation certificates can now be performed by Cost Accountants.
- Ensure the annual audit report and any adverse findings are submitted within one month of the audit report date, and no later than October 31st of each year.
Key dates-deadlines
- Effective Date: March 25, 2026.
- Annual Submission Deadline: Not later than October 31st of each year for the previous financial year.
- Audit/Certificate Timeline: Within six months from the end of each financial year.
Source reference
SEBI Circular: HO/38/12/12(1)2026-MIRSD-SEC-FATF/I/7933/2026, dated March 25, 2026.