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SEBI Plans Tighter Internal Audit Norms for MIIs

20 March 20251 min read
BANKING & FINANCESEBI Plans TighterInternal AuditNorms for MIIs20 March 2025safalsetu.com

Why in the news

SEBI inspections found that internal auditors had missed significant observations, so a consultation paper is expected soon.

Key proposals

AreaProposal
ProcessObservations go to department heads for comments, within a timeline set by the audit committee
IndependenceOnly KMPs attend, with the chairman’s prior approval
ScopeAll functions, including operations, compliance, risk, investor grievances and business development
StandardisationCommon terms of reference via the industry standards forum

Objective

  • Stronger risk management, internal control and governance.

Exam angle

  • Regulator: SEBI. Abbreviations: MII, KMP, HOD.

Test yourself

1. To whom will internal audit reports of MIIs be submitted under SEBI's proposal?

Reports will go only to the audit committee.

2. Who may be barred from sitting on MII audit committees under the proposal?

MDs may be barred to secure independence.

3. What triggered SEBI's plan to tighten internal audits at MIIs?

SEBI inspections found significant observations missed by internal auditors.

This topic is part of Daily Current Affairs 20 March 2025 (22 topics).

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