Description

BSE extends deadlines for submission of System Audit Plan and Preliminary Audit Report for trading members using Algorithmic Trading facilities for the half-yearly period ending September 30, 2025.

Summary

BSE has extended the deadlines for submission of System Audit reports (TYPE-III) for trading members who use Algorithmic Trading or provide Algorithmic Trading facilities to their clients. The extension applies to the half-yearly audit period from April 2025 to September 2025, following representations from market participants and consultation with SEBI.

Key Points

  • Extension granted for System Audit (TYPE-III) submission timelines
  • Applies to stockbrokers using or providing Algorithmic Trading facilities
  • Covers half-yearly audit period: April 2025 - September 2025
  • Extension approved by Exchanges in consultation with SEBI
  • Includes extension for QSBs (Qualified Stock Brokers)
  • Applies to System Auditor Appointment, Audit Plan, and Preliminary Audit Report submissions

Regulatory Changes

Revised timelines supersede the original deadlines specified in Exchange notice no. 20251017-29 dated October 17, 2025. The extension provides additional time for compliance with System Audit requirements for trading members engaged in algorithmic trading activities.

Compliance Requirements

Applicable to: All trading members who use Algorithmic Trading or provide Algorithmic Trading facilities to their clients, including QSBs.

Required Actions:

  1. Complete System Auditor Appointment and submit Audit Plan by December 10, 2025
  2. Submit Preliminary Audit Report by December 31, 2025
  3. Submit Action Taken Report (ATR), if applicable, by March 31, 2026

Important Dates

  • Audit Period: April 2025 - September 2025 (Half-yearly)
  • December 10, 2025: Deadline for completion of System Auditor Appointment and submission of Audit Plan
  • December 31, 2025: Deadline for submission of Preliminary Audit Report
  • March 31, 2026: Deadline for submission of Action Taken Report (ATR), if applicable

Impact Assessment

Operational Impact: The deadline extension provides trading members additional time to complete system audit processes, reducing compliance pressure during the initial implementation phase. This is particularly beneficial for members managing complex algorithmic trading systems.

Market Impact: No direct impact on trading operations or market activities. The extension is purely administrative and affects internal compliance timelines for trading members.

Scope: Affects all trading members engaged in algorithmic trading activities across all segments, providing uniform relief to the industry following stakeholder feedback.

Impact Justification

Extension of audit submission deadlines provides operational relief to trading members using algorithmic trading, affecting compliance timelines but not market operations or trading activities.