AMFI has reportedly finalized a common due diligence questionnaire for AMCs.
AMFI is in the process of appointing a mix of large and small audit firms to operationalise the due diligence mandated by SEBI. AMFI is said to have finalized a common questionnaire about due diligence, which will be adopted by all fund houses. Meanwhile, some AMCs are drafting their own list of questions in case a common questionnaire is not adopted by the industry.
All AMCs will have to fund the project independently. Thus, there may not be a common due diligence across the industry, which can be shared by all fund houses.
“AMCs will have to tie up with firms appointed by AMFI and get their audits done,” said a compliance officer of a large fund house.
“Due diligence is the responsibility of individual AMCs. Agencies will audit based on the brief given by them (AMCs). They can also go beyond what has been prescribed as a common practice. AMFI will appoint not less than four audit firms,” said a CEO of a bank-sponsored fund house.
Cafemutual had first reported about AMFI’s plans to appoint external auditors. But rumours were abuzz that AMCs might have to complete the task on their own. Hence, more than 40 fund houses would have knocked the doors of one distributor. Consequently, small fund houses have expressed their concern that they might end up losing their distribution network.
