Description

ICCL mandates all eligible Clearing Members to submit their Internal Audit Report (IAR) for the half year ended March 31, 2026 via the Electronic Filing System (IEFS) by May 31, 2026.

Summary

ICCL (Indian Clearing Corporation Limited) has issued a notice requiring all eligible Clearing Members to conduct a complete Internal Audit for the half year ended March 31, 2026 and submit the Internal Audit Report (IAR) through the ICCL Electronic Filing System (IEFS) by May 31, 2026. This is a recurring semi-annual requirement and continues the compliance framework established by earlier ICCL notices.

Key Points

  • Clearing Members who executed at least one trade between October 1, 2025 and March 31, 2026 for other stockbrokers and/or custodian participants are required to carry out the Internal Audit and submit the report.
  • Reports must be uploaded online via ICCL’s Electronic Filing System (IEFS) at https://iefs.bseindia.in under the ‘Internal Audit Report’ section.
  • Auditors empanelled with any Exchange are eligible to conduct the internal audit of Clearing Members, as per SEBI’s directive to ease compliance.
  • The Internal Audit Certificate (Annexure I) must be digitally signed.
  • Annexure II (Format of Internal Audit Report) must be submitted in both Excel and PDF formats, with the PDF digitally signed by both the auditor and the clearing member, including management comments.
  • For each ‘Not Complied’ observation, auditors must provide the number of instances verified and the amount/value involved in non-compliance.
  • Auditors must detail sample verification (sample date, shortlisted sample) wherever applicable, using the format in Annexure IV.
  • Compliance status of previous inspection/internal audit observations and details of repeat violations must be reported at Point No. K of the audit checklist.

Regulatory Changes

  • SEBI has directed that auditors empanelled with any Exchange (not just BSE/ICCL) are now eligible to conduct internal audits of Clearing Members, enhancing flexibility and easing operational difficulties for members and audit firms.
  • This notice supersedes and continues the series from prior ICCL notices: 20240322-55, 20241014-19, 20250415-9, and 20251017-26.

Compliance Requirements

  • Who must comply: Clearing Members (clearing for other stockbrokers and/or custodial participants) who had at least one trade during October 1, 2025 to March 31, 2026.
  • Audit scope: Complete Internal Audit for the half year ended March 31, 2026.
  • Submission portal: ICCL IEFS at https://iefs.bseindia.in.
  • Documents required:
    • Annexure I: Internal Audit Certificate (digitally signed)
    • Annexure II: Internal Audit Report in Excel and digitally signed PDF (signed by both auditor and clearing member, with management comments)
    • Annexure III: Guidelines on sample selection (to be referred before initiating audit)
    • Annexure IV: List of samples verified
  • Auditor appointment: Must follow guidelines issued under BSE circular no. 20231215-55 dated December 15, 2023.
  • Submission of the report with complete annexures will be treated as a valid ICCL submission.

Important Dates

  • Audit period: October 1, 2025 to March 31, 2026
  • Due date for IAR submission: May 31, 2026 (two months from end of half year)
  • Notice date: April 15, 2026

Impact Assessment

This is a routine semi-annual compliance obligation for Clearing Members operating on BSE/ICCL infrastructure. The operational impact is moderate — clearing members must coordinate with empanelled auditors, compile required data, and complete the digital filing process within the prescribed timeline. The relaxation allowing auditors empanelled with any exchange (not just BSE) to conduct audits reduces the compliance burden and gives members more flexibility in auditor selection. Late or non-submission will attract penalties and/or disciplinary actions as prescribed by ICCL. No direct impact on trading operations or market pricing.

Impact Justification

Routine semi-annual compliance requirement affecting clearing members who cleared trades for other stockbrokers or custodian participants during Oct 2025 - Mar 2026; no systemic market impact but has defined penalties for late/non-submission.