AMFI

Unit IV
OFFER DOCUMENT
Presented By:-
Ankit Jain
Pankaj Modi
Priya Maru
Mukul Yadav
Offer Document
New fund offer
The document containing the
detail of a NFO that the AMC or
sponsor prepare and circulate
to the prospective investor is
call the offer document.
Importance for The
Investor
One of the most important source of
information from the perspective of the
prospective investor.
Investor must understand the
fundamental attributes of the scheme.
The operating documents and describes
the products.
The primary vehicle for the investment
decision.
The contents
 Details of the sponsor and the AMC
 Description of the scheme and the
investment objective/strategy
 Terms of issue
 Historical statistics
 Investors’ Rights and Services
 SEBI Guidelines
 Validity of offer document for new schemes.
 Investors’ right to information on material
changes in schemes.
 Periodic revisions required in the offered
document.
 Distribution of revised documents specified.
 A copy of changes has to be filed with SEBI
 Where to obtain the updated offer
documents.
The front page of the Offer
Documents
 Name of the Mutual Fund
 Name of the Scheme
 Type of scheme
 Name of AMC
 Classes of units offered for sale
 price of guarantor in case of assured
return scheme
 Opening, closing and earliest closing
date for the offer.
 The risk factors
Standard risk Factor
 Investment are subject to market risks.
 NAV movement on basis of capita market
movement.
 Past performance is not indicative of the
future performance of the scheme.
 Name of scheme doesn’t indicate it’s
quality.
Scheme specific risk
factors
 Scheme investment objective / strategy.
 Risk arising from non- diversification.
 Specific risk factors associated with
investing in close ended scheme.
 Assured return scheme.
 AMC previous experience.
 Legal and Regulatory
compliance
AMC need to appoint compliance officer.
The draft offer document accordance with
SEBI regulations
All legal requirements connected with
launching
Disclosures made in the offer document are
true and fare.
The intermediaries named in the offer
document are registered with SEBI
 Financial
Information
Expenses
e.g.sales load charge % of NAV, initial
issue expenses, annual recurring
expenses.
Condensed Financial Information of
schemes
Information about last 3 fiscal year,
borrowing information of last year,
Constitution of the
Mutual Fund
Brief Description of the
Objectives of the Fund
Functions and responsibilities of
the its constituents: sponsor,
AMC, trustees and custodian
Activities of the sponsor and its
financial performance for the last
three fiscal years.
Conti……….
Names and addresses of the
Board of trusties and
director’s
Summary of trust deed
provision
Trusteeship fees
Investment objectives and
policies
Short description of the type
of securities.
Asset allocation pattern
Policy of diversification
At least 65% invest in
Scheme’s Implies name
Management of the
Fund
Name and background of the……..
Fund Manager
Key personnel
Investor relations officer
AMC and its Directors
The custodian
Registrar
Transfer agent and the statutory
auditor.
Offer related
Information
Minimum and Maximum amount required
Circumstances for refund
Calendar indicating
In case of listing name of Stock Exchanges
Option to convert close ended scheme into
open ended scheme
Circumstance under which scheme will be
wound up.
Procedure for transfer and transmission of
units
 Other key
information
Associate/group companies transactions
SEBI restricts
Borrowing policy
not allow accept
description of accounting Policies act (1996)
Tax Treatment of investments
Describe tax elements applicable to
investor and fund itself
 The Key
Information
Memorandum
Key Information
Memorandum
A. Investment objective
B. Asset allocation pattern of
the scheme
C. Plans and options
D. Benchmark index and
dividend policy
E. Names of Fund Manager and
Trustee Company
 Cont……..
F. Compounded annualized returns over a one,
three or five year period
G. Exp. Of Scheme with regard to Load
structure and recurring exp.
H. Source for obtaining daily NAV
I. Investor grievance contact
J. Information of accounting statement, annual
financial result and half-yearly portfolio