Description
BSE extends deadlines for system audit report submission by trading members using algorithmic trading, with new dates for audit plan, preliminary report, and action taken report.
Summary
BSE has extended the timeline for submission of System Audit reports for Trading Members (TYPE-III) who use algorithmic trading or provide algorithmic trading facilities to clients. The extension applies to the half-yearly audit period ending September 30, 2025, and was granted following representations from market participants in consultation with SEBI.
Key Points
- Extension applies to stockbrokers using or providing algorithmic trading facilities
- Covers half-yearly audit period from April 2025 to September 2025
- Extended deadlines apply to all eligible members including Qualified Stock Brokers (QSBs)
- Decision made in consultation with SEBI based on market participant requests
- References original notice 20251017-29 dated October 17, 2025
Regulatory Changes
No new regulatory requirements introduced. This circular provides timeline extensions for existing System Audit requirements under TYPE-III category for algorithmic trading members.
Compliance Requirements
Trading members using algorithmic trading must complete:
- System Auditor Appointment & Audit Plan Submission - Must be completed and submitted to BSE
- Preliminary Audit Report - Comprehensive audit report covering the specified period
- Action Taken Report (ATR) - If applicable based on audit findings
All submissions must be made to the Exchange by the respective extended deadlines.
Important Dates
Audit Period: April 2025 - September 2025
- 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 (if applicable)
Impact Assessment
Operational Impact: Medium - Provides relief to trading members by extending compliance deadlines, allowing additional time for thorough system audits.
Market Impact: Low - Administrative extension affecting internal compliance processes of algorithmic trading members without direct market operations impact.
Compliance Impact: Medium - Trading members must ensure timely appointment of system auditors and submission of required reports within the extended timelines to maintain regulatory compliance.
Impact Justification
Regulatory compliance deadline extension affecting trading members using algorithmic trading facilities, providing operational relief but requiring timely action