Market regulator Securities and Exchange Board of India has asked stock brokers and trading members to complete internal auditing on a half yearly basis from chartered accountants, company secretaries or cost and management accountants.
"It has been decided that stock brokers, trading members and clearing members shall carry out complete internal audit on a half yearly basis by chartered accountants, company secretaries or cost and management accountants who are in practice and who do not have any conflict of interest," Sebi said.
However, in a circular issued earlier, the market regulator had asked stock brokers and trading members to complete the auditing from independent qualified chartered accountants but now the role has been extended to company secretaries or cost and management accountants.
Sebi attributed this decision to protect the interests of investors in securities and regulate as well as promote the development of the capital market.
The stock exchanges are advised to make necessary amendments to the relevant bye-laws, rules and regulations for its implementation, it said.
Sebi has also advised stock exchanges to bring it to the notice of the member brokers and clearing members of the exchange and communicate to Sebi, the status of the implementation of the provision in the monthly development report.