CIRCULAR
SEBI/HO/AFD/SEC-1/P/CIR/2024/22 April 18, 2024
To
All Alternative Investment Funds (AIFs)
Sir/ Madam,
Sub: Circular on Standardization of the Private Placement Memorandum (PPM)
Audit Report
1. In terms of Regulation 28 of SEBI (AIF) Regulations, 2012 and Clause 2.4 of
SEBI Master Circular SEBI/HO/AFD/PoD1/P/CIR/2023/130 dated July 31, 2023
(Master Circular) it is mandatory for AIFs to carry out an annual audit of
compliance with the terms of Private Placement Memorandum (PPM). In terms
of Clause 2.4.2 of Master Circular, AIFs are required to submit Annual PPM Audit
Reports to the Trustee or Board of Directors or Designated Partners of the AIF,
Board of directors or Designated Partners of the Manager and SEBI, within 6
months from the end of the Financial Year.
2. In order to have uniform compliance standards and for ease of compliance
reporting, standard reporting format for PPM Audit Report applicable to various
categories of AIF has been prepared in consultation with pilot Standard Setting
Forum for AIFs (SFA).
3. The said reporting format shall be hosted on the websites of the AIF Associations
which are part of SFA within 2 working days of issuance of this circular. The
associations shall assist all AIFs in understanding the reporting requirements and
in clarifying or resolving any issues which may arise in connection with reporting
to ensure accurate and timely reporting.
4. The PPM audit reports shall be submitted to SEBI by AIFs online on the SEBI
Intermediary Portal (SI Portal) as per the aforesaid format.
5. In terms of Clause 2.4.1 of Master Circular audit of sections of PPM relating to
‘Risk Factors’, ‘Legal, Regulatory and Tax Considerations’ and ‘Track Record of
First Time Managers’ shall be optional. In addition, ‘Illustration of Fees and
Expenses’ and ‘Glossary and Terms’ shall also be optional.
6. All other provisions with respect to the filing of the PPM audit report specified in
the Master circular shall remain unchanged.
7. The reporting requirement mentioned at paragraph 3 above shall be applicable
for PPM audit reports to be filed for the Financial Year ending March 31, 2024
onwards.
8. To keep pace with the fast-changing landscape of AIF industry and for policy and
supervision purposes, the aforesaid reporting format shall be reviewed
periodically by pilot SFA in consultation with SEBI. In case of any revisions in the
reporting format, revised format shall be made available on websites of the
Associations which are part of SFA.
9. This Circular is issued in exercise of powers conferred under Section 11(1) of the
Securities and Exchange Board of India Act, 1992 to protect the interest of
investors in securities and to promote the development of, and to regulate the
securities the securities market.
10. This Circular is available on the SEBI website at www.sebi.gov.in under the
categories “Legal Framework” and under the drop down “Circulars” and “Info for
– Alternative Investment Funds”.
Yours faithfully,
Rajesh Gujjar
General Manager
Tel no.: +91-22-26449232
rajeshg@sebi.gov.in