Portfolio managers have extensive reporting obligations to both SEBI and clients. This article explains the monthly and periodic reporting requirements and what must be included.
Reporting to SEBI
Monthly Report Submission
Portfolio managers are required to submit a monthly report regarding their portfolio management activity, on SEBI Intermediaries Portal within 7 working days of the end of each month.
Report Format
The monthly report must be submitted as per the prescribed format in Annexure A. The format includes:
Type of Services Offered:
- Discretionary Service
- Non-Discretionary Service
- Advisory Service
Data for Discretionary Services:
- Break-up of clients (domestic and foreign)
- Assets Under Management
- Break-up of assets by Investment Approach
- Funds Inflow/Outflow
- Transaction Data (sales, purchases, portfolio turnover ratio)
- Performance Data
Data for Non-Discretionary Services:
- Similar breakdown for non-discretionary clients
Data for Advisory Services:
- Client base break-up
- Value of assets for advisory services
Complaint Data:
- Complaints received, resolved, and pending
Revised Format
The reporting requirements under the revised formats are applicable for monthly reports to SEBI from April 2022 onwards.
Reporting to Clients
Quarterly Client Reports
Portfolio managers shall furnish a report to their clients on a quarterly basis, as per the prescribed format.
Timeline
Quarterly statements must be sent within 10 days from the end of the quarter.
Contents of Client Report
The quarterly report to clients must include:
A. Account Overview:
- Name of the Client
- PAN
- Address
- Email and Phone number
- Unique Client Code
- Account Activation date
- Type of Portfolio Management Service
- Investment approach for the account
- Benchmark for the investment approach
B. Portfolio Details:
- Portfolio Allocation by type of security (Equity, Debt, Derivatives, Mutual Funds, etc.)
- Purchase Value and Market Value
- Percentage of Assets Under Management
C. Performance of Portfolio:
- Returns of Client Portfolio (1 Year, 3 Years, 5 Years, 10 Years, Since Inception)
- Aggregate Returns of Investment Approach
- Benchmark Performance
D. Transaction Details:
- Capital Contribution (inflow and outflow)
- Investments during the reporting period
- Holding Report as of end of quarter
E. Other Important Information:
- Deviations from investment approach
- Details of delay in coupon payments
- Details of default
- Details of funds and securities held as collateral
- Details of other assets outstanding
Co-Investment Reporting
The Co-investment Manager shall submit a monthly report on SEBI Intermediaries Portal within 7 working days. They shall also furnish a report to their clients on a quarterly basis, as per the prescribed format, which includes details of Co-investment services offered by them.
Performance Reporting
TWRR with Benchmark
Portfolio Manager shall present the TWRR of the IA along with the trailing return of the selected benchmark.
XIRR for Investors
Portfolio Manager shall present the Extended Internal Rate of Return (XIRR) for each IA the investor invests in when reporting performance to an investor. This shall be accompanied by the minimum, maximum and median XIRR return generated across all investors.
Disclaimer
A disclaimer must accompany performance disclosure: "Please note that performance of your portfolio may vary from that of other investors and that generated by the Investment Approach across all investors because of 1) the timing of inflows and outflows of funds; and 2) differences in the portfolio composition because of restrictions and other constraints."
Expert Legal Guidance
Anuj Desai & Associates provides expert legal advisory services on PMS reporting compliance. Our securities law experts help portfolio managers prepare compliant reports, meet filing deadlines, and ensure regulatory compliance. Contact us for guidance on reporting and other regulatory matters.