BSE Issues Notice on Internal Audit Requirements for Clearing Members

Strategic Insights -

The Bombay Stock Exchange (BSE) has notified all clearing members that they are required to conduct a thorough internal audit for the half-year ended September 30, 2025. The audit report must be submitted to the Indian Clearing Corporation Ltd. (ICCL) through the Electronic Filing System (IEFS) within two months of the audit period, i.e., by November 30, 2025. Failure to comply with the internal audit requirements may result in penalties or disciplinary actions as per ICCL's notice dated March 22, 2024.

Key Takeaways:

  • The internal audit report must be submitted by November 30, 2025, for the half-year ended September 30, 2025.
  • Clearing members are required to carry out a thorough internal audit, including verification of action letters issued by the Clearing Corporation for the last 6 months (April 01, 2025 to September 30, 2025).
  • The internal auditor must provide details of the sample verified, including the sample date and shortlisted sample, wherever applicable.
  • The internal audit report must be submitted in Excel format and as a PDF document, with both the auditor and the clearing member digitally signing the PDF version.
  • The internal auditor is required to verify the compliance of the clearing member with respect to the violations mentioned in the action letters and provide comments at Point No. K of the internal audit checklist.
  • The penalties/disciplinary actions for late/non-submission of the internal audit report shall be as per ICCL notice dated March 22, 2024.
  • The penalties/disciplinary actions for non-compliances reported in the internal audit report shall be as prescribed by ICCL circular dated December 29, 2023.

Statistics:

  • The deadline for submitting the internal audit report is November 30, 2025.
  • The audit period for which the report is required is six months, from April 01, 2025, to September 30, 2025.
  • The internal auditor is required to verify 6 months' worth of action letters issued by the Clearing Corporation.

Sources:

  • ICCL's Notice no. 20240322-55 dated March 22, 2024
  • ICCL's Notice no. 20241014-19 dated October 14, 2024
  • ICCL's Notice no. 20250415-9 dated April 15, 2025
  • ICCL's Circular no. ICCL notice no. 20231229-11 dated December 29, 2023
  • BSE's Circular no. 20240304-60 dated March 4, 2024