Description
NSE mandates trading members to conduct system audits for the period ending March 31, 2026, with preliminary audit reports due by June 30, 2026, and action taken reports by September 30, 2026.
Summary
NSE’s Inspection Department has issued Circular No. 20/2026 (Ref: NSE/INSP/73850) requiring all trading members to conduct a system audit for the period ending March 31, 2026. The circular references SEBI and Exchange guidelines on system audits of stockbrokers and introduces technology-based monitoring through the ‘NSE Member Portal’ mobile application. Only empaneled system auditors are permitted to conduct these audits.
Key Points
- System audits are required for the half-yearly period (October 2025 – March 2026) and yearly period (April 2025 – March 2026)
- Only auditors empaneled by NSE (per Circular NSE/INSP/69631 dated August 12, 2025) are eligible to conduct system audits from the half year ending September 30, 2025 onwards
- Audit plan details must be submitted via the NSE ENIT portal by June 05, 2026, covering auditor details, systems list, and office locations
- NSE has enabled geo-location capture via the ‘NSE Member Portal’ mobile app (available on Android and iOS) to monitor physical audit visits
- System auditors must log into the mobile app during physical visits to capture geo-location, team member details, audit period, and trading member’s address
- The list of empaneled system auditors is available at: https://inspection.nseindia.com/empanelment_auditor/auditor/viewEmpanelledAuditors/
Regulatory Changes
This circular reinforces and operationalizes the framework introduced under:
- SEBI Circular CIR/MRD/DMS/34/2013 (November 6, 2013)
- SEBI/HO/MIRSD/TPD/CIR/2025/10 (January 31, 2025)
- Exchange Circular NSE/INSP/66456 (February 3, 2025) on technology-based monitoring and supervision of system audits
A key update is the mandatory use of the NSE Member Portal mobile application by system auditors during physical visits to capture geo-location data, representing a shift toward technology-driven audit supervision.
Compliance Requirements
- Trading members must appoint only NSE-empaneled system auditors for the audit
- Complete audit plan details (auditor info, systems, office locations to be visited) must be submitted on NSE ENIT portal by June 05, 2026
- Preliminary Audit Report must be submitted to the Exchange by June 30, 2026
- Action Taken Report (ATR), if applicable, must be submitted by September 30, 2026
- System auditors must use the NSE Member Portal app during physical visits to log geo-location and visit details
- Auditors must use the same credentials as registered in ENIT during the mobile app login process
- Help file/user manual for auditors is available under auditor login in ENIT (Path: ENIT > NEW-TRADE > Trade > System Audit > System Audit Help File > Auditor Submission)
Important Dates
| Milestone | Deadline |
|---|---|
| Audit Plan Submission on ENIT Portal | June 05, 2026 |
| Preliminary Audit Report (Half Yearly & Yearly) | June 30, 2026 |
| Action Taken Report / ATR (if applicable) | September 30, 2026 |
Impact Assessment
All trading members are directly impacted and must ensure timely appointment of empaneled auditors and submission of audit reports. The introduction of geo-location tracking via the NSE Member Portal app increases the rigor of audit supervision, reducing the possibility of non-compliant or superficial audits. Members who have not previously engaged with the empanelment process must now strictly limit their auditor selection to the NSE-approved list. Non-compliance with audit timelines or auditor eligibility requirements may attract regulatory action from NSE/SEBI. The digitization of the audit trail through mobile-app-based geo-tagging represents a significant operational change for both trading members and their appointed auditors.
Impact Justification
Mandatory compliance requirement for all trading members with firm deadlines for audit submission; failure to comply would attract regulatory consequences. Impact is medium as it affects operational processes of trading members rather than market prices or trading conditions.