Part of the NISM-Series-V-A Exam Prep Kit

Visual Guide: the six process-heavy topics

Some things in the syllabus are easier to hold in your head as a picture than as a paragraph. These six cover the topics candidates most often mix up under exam pressure.

1. Mutual fund legal structure

Who sets up a mutual fund, who oversees it, and who actually runs it day to day — four distinct layers, each with a distinct job.

Sponsor promoter of the fund sets up via Trust Deed Mutual Fund Trust beneficiaries: the unit-holders appoints (SEBI approval) Trustees ≥ 2/3 independent appoints & oversees Asset Management Co. (AMC) runs day-to-day operations Custodian holds scheme's securities RTA maintains investor folios Distributors sell schemes to investors Investors (own Units in Schemes)

Remember: the Sponsor doesn't run the fund — it sets up the Trust and then largely steps back. The Trustees are the investor's real safeguard (two-thirds must be independent), and the AMC is the operating company that everyone thinks of as "the mutual fund."

2. NFO lifecycle

Every New Fund Offer moves through the same four checkpoints, each with its own regulatory deadline.

NFO Opens subscription begins NFO Closes subscription ends ≥ 3 working days, ≤ 15 days (non-ELSS) Allotment / Refund units issued or refunded within 5 business days Scheme Re-opens sale & repurchase begin within 5 business days

Remember: close-ended schemes stop at "Units Allotted" — there is no re-opening step, because the AMC never re-opens sale/repurchase for a close-ended fund. Investors exit later only via the stock exchange listing.

3. KYC flow — do it once, use it everywhere

The whole point of the centralised KYC system is that an investor never repeats this process for a second SEBI-registered intermediary.

Investor PAN + address proof + IPV Any intermediary AMC, distributor, DP... KRA KYC Registration Agency Central KYC Registry (CERSAI) Available to every other SEBI-registered intermediary — no repeat KYC needed

Remember: the only extra step is In-Person Verification (IPV), which is mandatory once but doesn't need repeating either — if a bank or depository has already done it, no other intermediary can insist on redoing it.

4. NAV cut-off time logic

One decision rule drives every cut-off-time question — the exact clock times just change by scheme type.

Was the application received before the cut-off? yes no Same business day's NAV applies Next business day's NAV applies plus: funds must actually be available for utilisation before the cut-off Cut-offs: 3:00 pm (equity/debt) · 1:30 pm purchase / 3:00 pm redemption (liquid & overnight)

Remember: for liquid and overnight funds, the applicable NAV is the previous calendar day's closing NAV, not the current day's — that's the one exception worth memorising separately from this general rule.

5. Scheme document hierarchy

Three documents, one purpose: give the investor everything they need before they invest — at three different levels of detail.

SID Scheme Information Document — this scheme only SAI Statement of Additional Info — whole AMC, statutory KIM summary of both — must accompany every application interim changes Addendum — travels with the KIM until revised

Remember: legally, the SAI is technically part of the SID — but in practice they're printed and updated as two separate documents, and only the KIM is small enough to physically attach to every application form.

6. Systematic transactions — four variations, one mechanism

SIP, SWP, STP and Switch all move money between a bank account and one or two schemes — the differences are direction, frequency, and how many schemes are involved.

Bank Account Scheme A source scheme Scheme B target scheme SIP fixed amount, into A SWP fixed amount, out of A STP multiple tranches: redeem from A (like an SWP), invest in B (like a SIP) Switch = a one-off STP same redemption + purchase mechanism, done once instead of on a schedule

Remember: a Switch and an STP move money the same way — the only real difference is that a Switch is a single one-off transaction, while an STP is pre-scheduled across multiple future tranches.