FINANCIAL SERVICES ASSIGNMENT 1

SUBMITTED TO: MS GEETIKA CHAWLA

Submitted by: Radhika goel IMBA 02 Deepanshi jerry IMBA 05 Anmol midha IMBA 06 Sunny arora IMBA 14 Shruti shukla IMBA 33 Anjali mehra F&A 02 Zehra naqvi F&A 07 Shiven Sharma F&A 01

Association of Mutual Funds in India (AMFI)

The Association of Mutual Funds in India (AMFI) is dedicated to developing the Indian Mutual Fund Industry on professional, healthy and ethical lines and to enhance and maintain standards in all areas with a view to protecting and promoting the interests of mutual funds and their unit holders. With the increase in mutual fund players in India, a need for mutual fund association in India was generated to function as a non-profit organization. Association of Mutual Funds in India (AMFI) was incorporated on 22nd August, 1995. AMFI is an apex body of all Asset Management Companies (AMC) which has been registered with SEBI. Till date all the AMCs are that have launched mutual fund schemes are its members. It functions under the supervision and guidelines of its Board of Directors. Association of Mutual Funds India has brought down the Indian Mutual Fund Industry to a professional and healthy market with ethical lines enhancing and maintaining standards. It follows the principle of both protecting and promoting the interests of mutual funds as well as their unit holders.

The objectives of Association of Mutual Funds in India

The Association of Mutual Funds of India works with 30 registered AMCs of the country. It has certain defined objectives which juxtaposes the guidelines of its Board of Directors. The objectives are as follows: To define and maintain high professional and ethical standards in all areas of operation of mutual fund industry. To recommend and promote best business practices and code of conduct to be followed by members and others engaged in the activities of mutual fund and asset management including agencies connected or involved in the field of capital markets and financial services. To interact with the Securities and Exchange Board of India (SEBI) and to represent to SEBI on all matters concerning the mutual fund industry. To represent to the Government, Reserve Bank of India and other bodies on all matters relating to the Mutual Fund Industry. To develop a cadre of well-trained Agent distributors and to implement a program of training and certification for all intermediaries and other engaged in the industry.

To undertake nationwide investor awareness program so as to promote proper understanding of the concept and working of mutual funds. To disseminate information on Mutual Fund Industry and to undertake studies and research directly and/or in association with other bodies.

AMFI, the apex body of all the registered Asset Management Companies, was incorporated on August 22, 1995, as a non-profit organization. As of now, all the 46 Asset Management Companies that are registered with SEBI are its members.

AMFI CODE OF CONDUCT

INTEGRITY Members and their key personnel, in the conduct of their business shall observe high standards of integrity and fairness in all dealings with investors, issuers, market intermediaries, other members and regulatory and other government authorities.

DUE DILIGENCE Members in the conduct of their Asset Management business shall at all times

1. Render high standards of service. 2. Exercise due diligence.

3. Exercise independent professional judgments . DISCLOSURES Members shall ensure timely dissemination to all unit holders of adequate, accurate, and explicit information presented in a simple language about the investment objectives investment policies, financial position and general affairs of the scheme. All transactions of purchase and sale of securities by key personnel who are directly involved in investment operations shall be disclosed to the compliance officer of the member at least on half

yearly basis and subsequently reported to the Board of Trustees if found having conflict of interest with the transactions of the fund.

PROFESSIONAL SELLING PRACTICES

1. Members shall not use any unethical means to sell, market or induce any investor to buy their products and schemes 2. Members shall not make any exaggerated statement regarding performance of any product or scheme. 3. Members shall endeavor to ensure that at all times investors are provided with true and adequate information without any misleading or exaggerated claims to investors about their capability to render certain services 4. copies of prospectus, memoranda and related literature is made available to investors on request,

5. Adequate steps are taken for fair allotment of mutual fund units and refund of application moneys without delay and within the prescribed time limits and, complaints from investors are fairly and expeditiously dealt with.

INVESTMENT PRACTICES Members shall manage all the schemes in accordance with the fundamental investment objectives and investment policies stated in the offer documents and take investment decisions solely in the interest of the unit holders. Members shall not knowingly buy or sell securities for any of their schemes from or to any director, officer, or employee of the member any trustee or any director, officer, or employee of the Trustee Company.

OPERATIONS Members shall avoid conflicts of interest in managing the affairs of the schemes and shall keep the interest of all unit holders paramount in all matters relating to the scheme.

REPORTING PRACTICES Members shall follow comparable and standardized valuation policies in accordance with the SEBI Mutual Fund Regulations. Members shall follow uniform performance reporting on the

basis of total return. Members shall ensure scheme wise segregation of cash and securities accounts.

UNFAIR COMPETITION Members shall not make any statement or become privy to any act, practice or competition, which is likely to be harmful to the interests of other Members or is likely to place other. Members in a disadvantageous position in relation to a market player or investors, while competing for investible funds.

OBSERVANCE OF STATUTES, RULES AND REGULATIONS Members shall abide by the letter and spirit of the provisions of the Statutes, Rules and Regulations which may be applicable and relevant to the activities carried on by the members.

ENFORCEMENT Members shall:

1. Widely disseminate the AMFI Code to all persons and entities covered by it 2. Make observance of the Code a condition of employment. 3. Make violation of the provisions of the code, a ground for revocation of contractual arrangement without redress and a cause for disciplinary action. 4. Require that each officer and employee of the Member sign a statement that he/she has received and read a copy of the Code. 5. Establish internal controls and compliance mechanisms, including assigning supervisory responsibility.

KNOW YOUR CLIENT (KYC) : In order to comply with regulatory provisions under the Prevention of Money Laundering Act 2002, Rules issued there under and related guidelines/circulars issued by SEBI, KYC formalities are required to be completed for all the investors, including Guardians and Power of Attorney holders, for any investment in mutual funds, irrespective of the amount, for carrying out the transactions such as new/ additional purchase, switch transactions, new SIP/ STP/ DTP registrations received from effective date i.e. January 1, 2011. The applications received for the aforesaid transactions without complying with KYC procedure are liable to be rejected. However, the said procedure is not applicable for redemption/ repurchase.

For the convenience of investors in mutual funds, all mutual funds have made special arrangements with CDSL Ventures Ltd. (CVL), a wholly owned subsidiary of Central Depository Services (India) Ltd. (CDSL). Accordingly, CVL, on behalf of all mutual funds will carry out the process of KYC and issue an acknowledgement. Investors have to provide the relevant documents and information ONLY ONCE for complying with KYC, instead of providing the required documents again and again to different mutual funds in which one would like to invest. After that Investors could invest in the schemes of all mutual funds by merely attaching a copy of the KYC acknowledgement slip with the application form / transaction slip when investing for the first time in every folio (Post KYC) in each Mutual Fund house, without the necessity to submit the KYC documents again. This facility is being provided absolutely FREE OF COST to the investors. DOCUMENTS AND INFORMATION TO BE PROVIDED BY INVESTORS: Investors in mutual fund schemes have to provide: (1) Proof of Identity (2) Proof of Address (3) PAN Card (4) Photograph

The originals of these documents along with a copy each to be presented and the original will be returned after verification. Alternatively, investors can also provide an attested true copy of the relevant documents. Attestation could be done by Notary Public/ Gazetted Officer/ Manager of a Scheduled Commercial Bank.

WHERE TO COMPLETE THE FORMALITIES: Investors could complete the formalities by submitting the KYC form and relevant documents at the Points of Services (POS). To start with, these POS will be the select branches / offices of mutual funds, registrars and select branches of some distributors. The application form for complying with KYC will be available from these POS. The application form could also be downloaded from the websites of all mutual funds and CVL www.cvlindia.com. Investors could contact offices of mutual funds, registrars and mutual fund distributors (ARN Holders) for further details and assistance.

REFRENCES:
http://www.amfiindia.com