Under the guidelines, mutual fund schemes will have to prepare the opening balance sheet as on date of transition and the comparatives as per the requirements of Ind AS, Sebi said in a circular.
As per mutual fund rules, perspective historical per unit statistics requires disclosure of scheme wise per unit statistics for the past three years.
In this regard, Sebi said mutual fund schemes may not be mandatorily required to restate the previous years published perspective historical per unit statistics as per requirement of Ind AS for the first two years from first time adoption of Ind AS.
However, mutual fund schemes will have to furnish certain additional information in perspective historical per unit statistics.
These additional information are related to label the previous Generally Accepted Accounting Principles (GAAP) information prominently as not being prepared in accordance with Ind AS; and disclose the nature of the adjustments that would be required to make it comply with Ind AS. Mutual Funds schemes need not quantify those adjustments.
The financial statements of the mutual fund schemes will have to be prepared in a formats specified by the regulator.
Also, Sebi has certain tweaked guidelines in order to align with Ind AS requirement regarding transactions cost of investment to be expensed out (viz. to be charged to Revenue Account instead of Capitalisation).
As part of the modification, Sebi said brokerage and transaction cost incurred for the purpose of execution will be charged to the schemes up to 12 bps and 5 bps for cash market transactions and derivatives transactions, respectively.
Any payment towards brokerage and transaction costs, over and above the said 12 bps and 5 bps for cash market transactions and derivatives transactions, respectively may be charged to the scheme within the maximum limit of total expense ratio (TER).
The new framework will be effective from April 1, 2023, the Securities and Exchange Board of India (Sebi) said.