Valuation of money market and debt securities

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..... y market and debt securities, including floating rate securities, with residual maturity of upto 60 days. In order to make the existing valuation practices for aforesaid securities more reflective of the realizable value, the following has been decided: 1.1.1 The residual maturity for amortization based valuation as referred to in SEBI circular dated February 28, 2012 shall be reduced from existing 60 days to 30 days. 1.1.2 Further, the amortized price shall be compared with the reference price which shall be the average of the security level price of such security as provided by the agency(ies) appointed by AMFI for said purpose (hereinafter referred to as valuation agencies ). The amortized price shall be used for valuation only if .....

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..... han the price post standard haircut. The said traded price shall be considered for valuation till the valuation price is determined by the valuation agencies. 2.1.3.2 In case of trades after the valuation price is computed by the valuation agencies as referred above and where the traded price is lower than such computed price, such traded price shall be considered for the purpose of valuation and the valuation price may be revised accordingly. 2.1.3.3 The trades referred above shall be of a minimum size as determined by valuation agencies. 2.1.4 AMCs may deviate from the indicative haircuts and/or the valuation price for money market and debt securities rated below investment grade provided by the valuation agencies subject to the .....

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..... , the provisions of paras 2.1.2., 2.1.3.1, 2.1.3.3 and 2.1.4 above shall be applicable. 4.0 This circular is issued in exercise of powers conferred under Section 11 (1) of the Securities and Exchange Board of India Act, 1992 , read with the provisions of Regulation 77 of SEBI (Mutual Funds) Regulations, 1996 , to protect the interests of investors in securities and to promote the development of, and to regulate the securities market. Yours faithfully, B. N. Sahoo Chief General Manager Tel no.: 022-26449250 Email: [email protected] - Circular - Trade Notice - Public Notice - Instructions - Office orders Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI .....

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