SEBI has introduced a system audit framework for Professional Clearing Members based on the SEBI Master Circular dated October 16, 2023. PCMs must conduct system audits following the guidelines according to Annexures 1 and 2. They must report non-compliances and ensure open issues from current and past audits. The audit report must be reviewed by the PCM’s Governing Board and submitted to CCs within one month. CCs will establish a penalty structure for timely audit report submission and observation closure. This framework is effective immediately, with the first audit for FY 2023-24.

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