Nism newsletter july_2010 (1)


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Nism newsletter july_2010 (1)

  1. 1. Newsletter National Institute of Volume: 2, July 2010, Issue: 7 Securities Markets Foreword NiSM “You have to know accounting. It’s the language of practical business life” - Charlie Munger, Vice-Chairman, Berkshire Hathaway Corporation. Accounting is one of the important tools to analyze and understand the fundamentals of an entity. Good accounting has multi-layered ramifications. The Inside this issue: four primary characteristics of good accounting are: relevance; reliability; understandability; and comparability. With the objective of creating a global Foreword 1 accounting standard fulfilling these characteristics, International Financial Reporting Standards (IFRS) have been developed by International Accounting Events at NISM 2-7 Standards Board (IASB). About 120 nations including Australia, New Zealand, the UK, countries in the European Union and African countries in the world have Team at NISM 8 adopted IFRS. It is believed that adopting IFRS would lead to positive implications for companies, investors as well as for regulators. On 22 January 2010, the Ministry of Corporate Affairs (MCA) announced convergence of Indian GAAP with IFRS in three phases starting from April 1, 2011. This paradigm shift in the reporting standards necessitates understanding the significant measurement and Editorial Committee: disclosure principles in financial reporting using IFRS. Hence, NISM in Prof. G. Sethu collaboration with Deloitte is offering a series of two day training programmes on IFRS for analysts and users of financial statements. Rajnish Kumar Shobana B In accordance with SEBI (CAPSM) Regulations 2007, NISM has launched a series of mandatory examinations for certification of intermediaries in the securities markets. Certificate examinations for Depository Operations, Security Operations and Equity Derivatives are being developed. The admissions for NISM’s executive programme “Certificate in Financial Engineering and Risk Management (CFERM)”, have been in full swing. The classes for Certified Securities Markets Professional (CSMP), full time post Receiver’s Address: graduate certificate programme, has commenced. The next few pages provide details of the various activities undertaken during the month. Please send us your feedback at For further communication please contact: National Institute of Securities Markets, Sixth Floor, Plot No. 82, Sector - 17, Vashi, Navi Mumbai-400705, Phone No. 022-27883001. You can also visit nism website: or write to us at
  2. 2. Volume 2, Issue 7 National Institute of Securities Markets Page 2 School for Certification of Intermediaries (SCI) Monthly Update on Certificate Examinations NISM currently offers the following examinations: Examination Enrolments* NISM-Series-I: Currency Derivatives Certification Examination: 17731 (From May 15, 2009) NISM-Series-II-A: Registrars to an Issue and Share Transfer Agents - Corporate: 310 (From August 3, 2009) NISM-Series-II-B: Registrars to an Issue and Share Transfer Agents – Mutual Funds: 1099 (From August 3, 2009) NISM-Series-IV-A: Interest Rate Derivatives Certification Examination: 25 (From May 20, 2010) NISM-Series-V-A: Mutual Fund Distributors Certification Examination: 1663 (From May 5, 2010) *Figures till 12 July, 2010 NISM has launched the NISM-Series-IV-A: Interest Rate Derivatives Certification Examination: SEBI has notified this examination as the requisite standard for the approved users and sales personnel of the ‘Trading Members’ who are registered as such in the Currency Derivatives Segment of a recognized stock exchange and trading in Interest Rate Derivatives. The examination seeks to create a common minimum knowledge benchmark for persons working in the Interest Rate Derivatives market segment, in order to enable a better understanding of fixed income securities markets and interest rate derivative products, regulations and risks associated with the products and the mechanisms of clearing and settlement. Examination Objectives: On successful completion of the examination the candidate should:  Know the basics of fixed income securities markets, specifically interest rate derivative markets in Indian and developed world.  Understand the analytical framework required for Bond Futures market in India along with trading and hedging strategies involved  Understand the clearing, settlement and risk management as well as the operational mechanisms related to interest rate derivatives markets  Know the regulatory environment in which the interest rate derivatives markets operate in India. Test objectives and workbook are available for downloading at
  3. 3. Newsletter National Institute of Securities Markets Page 3 Certification Examination for Financial Advisors by NISM and FPCIL In pursuance of the MoU signed between Financial Planning Corporation (India) Private Limited (FPCIL) and National Institute of Securities Markets, a joint certification examination for Financial Advisors is being developed and will be launched soon. This will be a voluntary examination and will be open to all. The certification was launched on July 8, 2010 in Mumbai. On this occasion Mr. C.B. Bhave, Chairman, Securities and Exchange Board of India (SEBI) said, “Financial Planners should keep the investor interest as their prime focus. This examination is the necessary first step to prepare them for rendering this service. This should be followed by continuous education and training”. Prof. G Sethu, Officer on Special Duty, National Institute of Securities Markets (NISM) said, “NISM believes that financial planners can add considerable value to the investment decisions of retail investors. If financial planners demonstrate proficiency, investors would place more confidence in them. The certification examination for financial advisors is a step in that process. It is a purely voluntary certification and NISM hopes that the quality of the certification would meet the market’s expectations” The certification will aim to enhance the quality of financial advisory and related services in the financial services industry. It seeks to create a Prof. G. Sethu (OSD, Incharge NISM) addressing the audience at the launch common knowledge benchmark for all persons of Certification Examination for Financial Advisors, accompanied with Mr. Ranjeet Mudholkar (Managing Director, FPCIL), Mr. C. B. Bhave (Chairman, involved in financial advisory including SEBI) and Mr. Shailesh Haribhakti (Chairman, Advisory Board, FPCIL) Individual Financial Advisors, employees of organizations engaged in financial advisory services and employees of asset management companies, banks, wealth management companies. The examination will cover competencies related to the basics of financial advisory services, evaluation of financial products and customer profiling with implication on associated investment risk and expected return, various strategies and planning for retirement, personal taxation, insurance and succession. Objectives: The candidate at the end of the examination is expected to:  Know the basics of financial advisory, steps in the advisory process, making and implementation of financial plan  Understand how to evaluate different products, understand the customer profile, the match between the product and customer need, and how the recommendation of the product can impact investment risks, returns and strategies in a personal finance environment for investors and prospective investors in the market  Get oriented to the income tax, wealth tax and legalities of estate planning in personal finance, and regulatory aspects underlying advisory.  Get acquainted with financial planning as an approach to investing, insurance, retirement planning and a tool for advisors to develop long term relationships with their clients.
  4. 4. Volume 2, Issue 7 National Institute of Securities Markets Page 4 IFRS Training Programme for Analysts National Institute of Securities Markets has been mandated with the task of investor-empowerment through training and education. It seeks to provide training for the various stakeholders, especially analysts from brokerage firms, investment institutions and others in the BFSI analytics space. Towards this end, NISM in collaboration with Deloitte, proposes to launch a series of two-day training programmes on IFRS, covering a wide range of IFRS Standards. Objective: India has announced convergence of existing Accounting Standards (popularly known as Indian GAAP) with International Financial Reporting Standards (IFRS) from April 1, 2011 for large companies. The workshop on IFRS for analysts is designed to provide detailed understanding of the impact of moving to globally accepted recognition and measurement principles and related disclosures. Target Participants: This two day IFRS workshop aims to provide understanding of the significant measurement and disclosure principles in financial reporting using IFRS. It will enable the analysts to evaluate the impact of moving to the new financial reporting standards. This workshop will be relevant for:  Analysts who evaluate the financial statements  Users of the financial statements who regularly evaluate the financial information for various purposes such as investment/lending/credit rating  Consulting firms in the Knowledge Process Outsourcing (KPO) sector especially with a presence in the BFSI space Sessions will focus on significant aspects of the following IFRS standards  Overview of IFRS and impact on Financial Statements  Major differences between Indian GAAP and IFRS  IAS 1 - Presentation of Financial Statements  IFRS 1 – First Time Adoption of IFRSs  IAS 18 – Revenue along with applicable IFRICS  IAS 11 - Construction Contracts  IAS 16 – Property, Plant and Equipment  IAS 36 – Impairment of Assets  IAS 37 – Provisions, Contingent Liabilities and Contingent Assets  IAS 27, 28 and 31 – Consolidation of Subsidiaries, Associates and Joint Ventures  IAS 39, 32 and IFRS 7 and 9 – Financial Instruments  IFRS 3 – Business Combinations Analysis of major impact on certain sectors
  5. 5. Newsletter National Institute of Securities Markets Page 5 Salient details are as under: Venue: Mumbai Dates: Batch I : July 30 – 31, 2010 (Friday & Saturday) Batch II : August 13 – 14, 2010 (Friday & Saturday) Batch III : August 27 – 28, 2010 (Friday & Saturday) Fees: Rs.9,800, inclusive of course material. This is a non-residential programme. Certificate of participation will be awarded. For further enquiries, email, with the message caption: IFRS. Certified Securities Market Professionals (CSMP) With the aim of grooming talent to serve the securities markets, NISM is offering Certified Securities Market Professional (CSMP), a one year full time post graduate certificate programme. 47 students were selected after a rigorous selection procedure. CSMP programme commenced on June 22, 2010. Mr. S.T. Gerala, Director, Satco Securities and Financial Services Ltd., Mr. M.L.Soneji, Registrar, NISM and Prof. Sunder Ram Korivi, programme Director-CSMP inaugurated the programme. Mr. S.T.Gerela delivered the inaugural speech on “New Horizons in Indian Stock Market – Prospects and Challenges”. He gave a brief account of evolution of Indian Stock Market– from days of open outcry system to online trading, dematerialization, risk management through setting up of clearing corporation, introduction of derivatives trading, and reduction of settlement period. He noted that improvement in the efficiency and Mr. S. T. Gerela addressing CSMP students at the inaugural session held on June 22, 2010 transparency in the operations of stock market boosted investor confidence and also created a new channel of capital inflow in the form of foreign institutional investments. However, he also felt there are some areas which could be developed further. Higher compliance for brokers/ clients, increase in Direct Market Access (DMA) and improvement in retail investor participation were some of these areas. With over 30 years of experience, Mr. Gerela gave a practical insight to the working of Indian securities markets and its challenges and encouraged the CSMP students to work towards these challenges.
  6. 6. Volume 2, Issue 7 National Institute of Securities Markets Page 6 Empanelment of Resource Persons for financial literacy efforts of SEBI NISM, on behalf of SEBI, is in the process of empanelling resource persons across the country. These resource persons would be responsible for conducting financial literacy sessions to different categories of investors. The first batch of 27 resource persons completed their training in various modules related to financial literacy during June 7-13, 2010. During the second batch of training of resource persons, 16 participants were provided similar training at NISM Bhavan during June 14-20, 2010. The participants Mr. G. P. Garg (CGM, SEBI) addressing the participants at the training programme included selected candidates from the western zone states of Maharashtra, Madhya Pradesh, Rajasthan, Gujarat and Goa. Currently applications are being invited from the states in the North, South and East Zones of the country from where approximately 100 applications have already been received. Selected candidates would be shortlisted and subsequently trained in Delhi, Kolkatta and Chennai to impart financial literacy sessions to investors in their respective geographical areas. Mr. Paritosh Sharma addressing the participants. Outbound Training Programme for NISM Staff National Institute of Securities Markets (NISM) conducted an outbound training programme for its employees at Kamshet, near Lonavala. The two-day programme was conducted by FlyNirvana, their motto being ‘thrills & tranquility’. The focus of the programme was team building which creatively involved nature in its background. In the program, participants were made to go through various outdoor activities where they faced challenging situations as individuals and teams. The specialist facilitators have extensive experience in conducting adventure sports such flying fox, valley crossing, construction of burma/ monkey bridges and other team activities. This helped the group see the importance of communication, leadership, teamwork, planning, problem solving and delegation. Many considered the outbound training as one of the best platforms for personality development, confidence building, team building. There was extensive interaction among employees and their Group photograph of NISM family at the outbound training families which was an icebreaker at various levels. programme at Kamshet.
  7. 7. Newsletter National Institute of Securities Markets Page 7 Training of Trainers Programme for Corporate Governance NISM in collaboration with Global Corporate Governance Forum (GCGF), Confederation of Indian Industry (CII) and Indian Institute of Management - Calcutta is organizing Training of Trainers Program (TOT) on Corporate Governance at Fortune Select Exotica in Vashi (Navi Mumbai) from 22nd to 25th January 2010. The TOT Program is intended to build capacity of existing corporate governance trainers to further enhance their knowledge, understanding and teaching techniques. Participants will develop the knowledge base and skill sets needed to lead director education programs that reflect international best practices adapted to regional and in-country needs. This four day interactive workshop trains the trainers of directors in adult learning skills and techniques, in the familiarization and use of the GCGF’s resources kit, help other trainers and in global developments in corporate governance. Eminent faculty in the area of corporate governance from all over the world will be taking the sessions. Faculty will be led by Mr. Eugene Spiro, senior projects officer, Global Corporate Governance Forum and will include Dr. Mary Jo Larson PhD., an experienced trainer and co-author of the kit and expert in adult education, Prof. Chris Pierce, chief executive and founder of Global Governance Services Ltd., an UK based firm providing a variety of governance related services to a wide range of clients worldwide and Mr. Pratip Kar, former executive director Securities and Exchange Board of India and member advisory council, Forum. We received overwhelming response from across the country and from overseas. However, keeping in view the optimal batch size for the effective delivery of the programme, the batch size was limited to 20 for the July 2010 version of the programme. This clearly indicates the growing importance of corporate governance in both academia as well as industry circles in India. NISM had organized a similar programme at The Retreat, Madh Island (Mumbai) in January 2010. To obtain feedback on how they were able to use the knowledge gained in that programme and to share the experiences of our earlier TOT participants, we have invited them for an Alumni meet on July 22nd at Fortune Select Exotica, Vashi (Navi Mumbai). This helps us in taking stock of the current direction of our corporate governance training activities, to decide on future course of action, and to improvise our future offerings. Workshop for MF trustees and independent directors of Asset Management Companies in the MF industry The School for Regulatory Studies and Supervision (SRSS) of NISM proposes to organize a workshop for members of board of directors of trustee companies and independent directors of Asset Management Com- panies in the MF industry on September 15, 2010 in Mumbai. A similar event was conducted in August 2008 in Mumbai. During the proposed workshop, there would be presentations on the debt market and perform- ance evaluation. The event is a forum for the participants to interact with each other to develop a shared un- derstanding of the manner in which the industry should develop. Securitization Summit 2010 The School for Regulatory Studies and Supervision (SRSS) of NISM has proposed the second edition of Securitization Summit, to be held on August 10, 2010 in Mumbai. The Summit would discuss regulatory issues and the current status of the securitization industry in India. About 100 market participants are expected to attend. Senior officers from regulatory organizations and market participants would deliberate on the pertinent issues.
  8. 8. Volume 2, Issue 7 National Institute of Securities Markets Page 8 Team at NISM Prof . G Sethu Officer on Special Duty & In Charge of NISM B.Tech (IIT-Kharagpur), M.Tech (IIT- Madras), PhD (Finance, IIM-A) Mr. Mahesh Liladhar Soneji Registrar FCS (ICSI - New Delhi), LL.M. (Commercial Laws), PGDFM, DTL&P, B.A. (Economics) Academic Staff Prof. Sunder Ram Korivi Ms. Kavitha Ranganathan Professor, Academic Associate, Phd (Mumbai), Fellow (ICAI) M.Phil. ( Commerce, MKU) Dr. Kiran Kumar, Mr. Rajnish Kumar Assistant Professor, Academic Associate, PhD (Finance, IISC- Bangalore) M.Sc (Economics, IGIDR) Dr. Poonam Mehra Ms. Shobana Balasubramaniam Assistant Professor, Academic Associate, PhD (Economics, IGIDR) M.Sc (Economics, IGIDR) Managerial Staff Mr. Paritosh Sharma Mr. Chaitanya Nemalli Advisor Project Manager MBA (XLRI- Jamshedpur) MBA (Finance-NMIMS Mr. Vikas Chaturvedi Ms. Devvya Sharma OSD, SEBI Project Manager Chartered Accountant MBA (Finance-NMIMS) Mr. Jitender Aggarwal Ms. Gargi Datta Vice President ( Estate & Administration) Project Manager MFM (JBIMS) MBA (Finance -NMIMS) Mr. S. Venkatesh Mr. Naresh Sabbani Vice-President (Human Resources) Project Manager MBA (HR– Osmania University) MMS (Finance - JBIMS) Mr. A. V. Sankar Mr. Nikhil Shinde Assistant Vice President (F&A) Project Manager Certified Financial Planner MMS (Finance - JBIMS) Mr. A. S. Ramayya Mr. Suneel Sarswat Assistant Vice President (Administration) Head, Analytics SAS, Masters in Human Resource Development M.Sc. (Statistics and Informatics, IIT Bombay) Ms. Mitu Bhardwaj Programme Manager MBE (Finance- School of Economics D.A.V.V, Indore)