Stock Broking Compliance - Knowledge center
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Mutual Fund Distributor (Kishor J Kular)
12/03/2022
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Operational Guidelines for transfer and dematerialization of re-lodged physical shares:
SEBI | Operational guidelines for Transfer and Dematerialization of re-lodged physical shares
02/12/2020
https://www.bseindia.com/markets/MarketInfo/DispNewNoticesCirculars.aspx?page=20201201-40
Relaxation in Compliance requirements - COVID-19
1 Internal Audit for half year ended on September 30, 2020 Till December 31, 2020
2 System Audit for half year ended on September 30, 2020 Till December 31, 2020
3 Half yearly net worth certificate as on September 30, 2020. Till December 31, 2020
4 Cyber Security and Cyber Resilience Audit for half year ended on September 30, 2020. Till January 31, 2021
Impact on commodity broker due Crude Oil contract settled at negative price.
What is future contract?
If a person buy a contract for future date price goes up, he will get profit and vice-versa. The person can sell first and get profit when price goes down and vice-versa
Margin Requirement:
If any person want to entered into future contract of crude oil at MCX, then client has to pay upfront margin of 55% due to volatility in crude oil price. In MCX crude oil is a 100 Barrel contract.
Friday closing price was Rs. 1436
Contract value is Rs. 143600
Margin requirement 55% i.e. approx 75000
What happened with Crude oil?
Generally Crude oil contract settled on expiry date at the rate of closing price at NYMEX.
Due to lock down the trading timing on MCX is 9 A.M. to 5 P.M.
Closing price of Crude oil at MCX was Rs. 965 and in International Maket it was closed at -37$ therefore it was settled in Indian Market at Rs. -2880. (settled in Negative)
Impact on Broker:
As per my view that contract should be settled at Rs. 965 closing price of crude oil at MCX. But it has been settled at negative price.
Loss to the client is difference of Rs. 965 and Rs. -2880, that is 3845
Margin available with Broker is approx Rs. 75000 and loss to client is Rs. 384500. Therefore fund due to broker from client is approx Rs. 310000
If client default to pay then it comes bad debts to the broker.
Broker has to recover from the client.
Example set for one client only in the industry. There are so many clients traded in crude oil contract. There is huge losses in the industries due to all contract settled at negative price.
Regards
CS Jay Kular
21/04/2020
Bombay High Court Order under section 140(5) of Companies Act, 2013.
Big win for Deloitte, BSR in IL&FS case where government was seeking to ban them The Bombay High Court said that the Ministry of Corporate Affairs (MCA) cant take action against the two.
Depository Participant Updates:
DPs are advised to refer to the revised format for submission of report on internal audit and concurrent audit of risk prone areas of DP operations for the half year ended 31st March 2020. DPs are advised to submit IAR in prescribed format on or before 15th May 2020.
For more information please refer communique of DP:
CDSL/AUDIT/DP/POLCY/2020/183 dated April 09, 2020.
Regards
CS Jay Kular
08/04/2020
Stock Broker Compliance Update:
Exchange has relaxed certain compliance requirements by Members on account of the prevailing coronavirus (COVID-19) pandemic.
No Change - quarterly report on incidence of cyber-attacks and threats i.e. 15 days after the end of the quarter.
Source - https://www.bseindia.com/…/Ma…/DispNewNoticesCirculars.aspx…
Regards
CS Jay Kular
Portfolio Manager Regulation Updates:
Due to CoVID-19 pandemic Securities and Exchange Board of India (SEBI) has decided to extend TWO MONTHS for following:
1. Monthly reporting to SEBI by Portfolio Manager for the period ending March 31, 2020 and April 30, 2020.
2. Applicability of SEBI Circular dated February 13, 2020 on "Guidelines for Portfolio Manager"
Source: SEBI Website
Regards
CS Jay Kular
Commodity Trading Updates:
In view of the Novel Covid19 virus pandemic outbreak and the nation-wide lockdown of 21 days in the country and pursuant to discussions with SEBI, it has been decided to revise Trading timings, from Monday, March 30, 2020 to Tuesday, April 14, 2020, as under:
Trading Start Time: 09:00 AM to 05:00 PM
The above timing shall be effective from Monday, March 30, 2020.
Source: MCX and NCDEX Website.
Regards
CS Jay Kular
26/03/2020
Pl call@ 8460042325 for stock broking Advisory
Stock Broking updates:
***Collection and reporting of margins by Trading Member (TM) /Clearing Member (CM) in Cash Segment***
The penal provision for non-collection/short collection of margins by brokers which was to be implemented from April 01, 2020 has been deferred till April 30, 2020.
However, reporting of non-collection/short collection of margins in the cash and derivatives segment shall be continued to be done by the Broker.
Source: Circular No.: NCL/CMPT/43948 dated 24/03/2020 available on NSE Website.
Regards
CS Jay Kular