NISM Series XIX-C flashcards
NISM Series XIX-C · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- AIF minimum corpus
- Each AIF scheme must have a minimum corpus of INR 20 crore; smaller schemes cannot be registered with SEBI under the AIF Regulations, 2012.
- AIF minimum investor commitment
- Each investor in an AIF must commit at least INR 1 crore; managers, employees and sponsors may commit a lower INR 25 lakh threshold.
- AIF maximum investors
- A scheme may have at most 1,000 investors, excluding the manager, employees and sponsors; listed schemes may exceed this cap.
- AIF permitted legal forms
- AIFs may be set up as a trust, company, LLP, or body corporate; the trust form with a registered trustee is most common in India.
- AIF scheme tenure
- Close-ended schemes must have a minimum tenure of 3 years; extension up to 2 years requires consent of two-thirds of investors by value.
- AIF registration validity
- AIF registration with SEBI is valid for 5 years and must be renewed; schemes must be filed with SEBI before launch.
- AIF sponsor contribution
- Manager or sponsor must contribute 2.5% of corpus or INR 5 crore, whichever is lower, in Category I and II; 5% or INR 10 crore in Category III.
- AIF PPM filing
- The Private Placement Memorandum must be filed with SEBI at least 30 days before scheme launch; commitments cannot be accepted before filing.
- Investment Manager net worth
- An AIF Investment Manager must maintain a minimum net worth of INR 2 crore; Category III managers must maintain INR 5 crore.
- AIF trustee role
- For trust-form AIFs, a SEBI-registered debenture trustee oversees the scheme, ensures compliance with regulations, and safeguards investor interests.
- AIF annual compliance report
- Managers must file audited accounts, compliance certificates, and portfolio disclosures with SEBI and investors within 180 days of financial year-end.
- Material change reporting
- Changes in control, sponsor, key personnel, or scheme terms must be reported to SEBI within 30 days of occurrence by the AIF manager.
- AIF compliance officer
- Each AIF manager must designate a compliance officer responsible for monitoring regulatory compliance and responding to investor grievances within 30 days.
- Related-party investment rule
- AIF schemes cannot invest in affiliates of the manager without prior investor consent and disclosure; such transactions must be at arm's length.
- Category I AIF
- Category I covers socially or economically desirable funds: venture capital, SME funds, infrastructure funds, and angel funds; leverage is restricted to operational needs.
- Category II AIF
- Category II covers private equity and debt funds not falling in Category I or III; leverage is permitted only for temporary funding needs, not for investment strategies.
- Category III AIF
- Category III covers hedge funds and funds using complex strategies, derivatives, and leverage; a custodian is mandatory and leverage must be disclosed.
- Angel fund limits
- Angel funds are a Category I sub-category: minimum INR 25 lakh per investor, max 49 investors, 3-year lock-in, and max INR 10 crore per investee.
- Category III leverage limit
- Category III AIFs may leverage up to 2x net asset value; Category I and II may leverage only up to 1.25x for temporary funding needs.
- AIF valuation frequency
- Category I and II schemes value investments at cost until fair value is available; Category III schemes mark to market at least monthly.
- Independent valuation requirement
- AIF schemes must be valued annually by an independent valuer registered with SEBI; the valuation policy must be disclosed in the PPM.
- Portfolio concentration limit
- No single investee may exceed 25% of an AIF scheme's corpus, except Category III schemes where disclosed limits apply.
- AIF private placement rule
- AIF units may be sold only via private placement; public advertising and general solicitation are prohibited, and minimum commitment is INR 1 crore.
- Distributor disclosure
- Distributor fees must be disclosed in the PPM; payments from scheme assets require investor consent and cannot be hidden.
- Investor documentation
- Before committing, investors must receive the PPM, scheme terms, and term sheet; consent to terms must be documented in writing.
- KYC and accredited investor
- AIF managers must verify accredited-investor status and complete KYC/AML checks before accepting any investor commitment into a scheme.
- AIF investor reporting
- Managers must send quarterly portfolio reports and annual audited statements to investors; Category III NAV must be disclosed at least monthly.
- Prohibited marketing claims
- AIF marketing cannot promise guaranteed returns or misrepresent past performance; performance must be presented net of all fees and expenses.
- Front-running prohibition
- AIF staff cannot trade personal accounts ahead of scheme trades; personal trading must be monitored and disclosed under the manager's code of conduct.
- AIF record retention
- AIF managers must retain scheme records for at least 5 years and AML/KYC records for at least 8 years after the relationship ends.
- AIF scheme segregation
- Each AIF scheme must maintain separate accounts and assets; scheme assets cannot be commingled with the manager's own funds or other schemes.
- AIF grievance escalation
- Unresolved investor complaints after 30 days with the manager may be escalated to SEBI's SCORES platform for regulatory review.