OFFER

DOCUMENT
 WHAT IS AN OFFER DOCUMENT
(OD)
 OD of a mutual fund scheme is a
prospectus issued by an Asset
Management Company / Sponsor.
 It invites the public for subscription in
units of the scheme.
 It discloses the information which is
adequate to enable an investor to
make an informed investment
decision.
 Offer Document (OD)

 A legal document

 issued by AMC or Sponsor

 OD describes the product

 Very important document

from the perspective of
prospective investor

 Primary vehicle for

investment decision
 Offer Document (OD)
* All ODs are to be approved by the trustees of the
Mutual Fund;
* ODs are prepared and issued by the Asset
Management Company;
* All ODs are filed with SEBI with filing fees (Rs.
25,000)
* Modifications, if any, are advised by SEBI within
21 working days from the date of its filing;
 Offer Document (OD)

 Close ended fund: issued at the time of

fund – launch

 Open ended fund: revision after every

two years

KIM: Abridged version of OD which is

distributed along with the application
form
 Contents of the Offer
Document
 Summary information
 Definitions
 Risk Factors
 Legal and Regulatory Compliance
 Financial Information
 Constitution of the Mutual Fund
 Investment objectives and policies
 Management of the Fund
 Offer Related information
 Contents of the Offer
Document
Summary Information
( Cover Page) :

 Name of Mutual Fund/ AMC

 Name of Scheme/ Type of scheme
 Period of opening / closing
 SEBI Disclaimer
 Contents of the Offer
Document
Risk Factors

 Standard Risk factors

 Scheme specific risk factor(s).

 Contents of the Offer Document
Legal and Regulatory Compliance

 AMC shall confirm that a Due diligence

certificate is duly signed by compliance
officer / CEO / Whole time Director / MD
 Certificate to the effect
(a) OD prepared is in accordance with SEBI
(MF) Regulations,
(b) legal requirements are complied with,
(c) disclosures are true and fair,
(d) intermediaries named in the OD are
registered with SEBI.
 Contents of the Offer Document

Financial Information
 Expenses - Sales load, CDSC, Initial issue
expenses, estimated annual recurring
expenses

 Condensed Financial information of

schemes
- Information regarding schemes launched
during the last 3 years
-Historical per unit statistics
 Contents of the Offer Document

Constitution of the Mutual Fund /

Management of the Fund

 Name of the sponsor / AMC / Board of Trustees

 Powers of Trustees
 Names of Key personnel
 Custodian / Registrars
 Investors relations officer
 Name, age, qualifications and experience of
fund manager(s)
 Contents of the Offer Document

Investment objectives and Policies

 Investment only in transferable securities in

the money market and the capital market or in
privately placed debt or securitised debt
provided they are rated not below investment
grade.
 Minimum and maximum asset allocation under
equity, debt and money market instruments
has to be specified in the OD.
 MF can alter the asset allocation for a short
term period on defensive consideration.
 Investment Strategy: Regarding portfolio
turnover, overseas investments, limits, stock
lending etc.
 Contents of the Offer Document

Offer Related Information

 Investment procedure
 Schemes policy on dividends &
distributions, ISTs (Inter Scheme transfers)
 Associate Transactions
 Borrowing Policy
 NAV and Valuation
 Contents of the Offer Document

Offer Related Information contd…

 Procedure for Redemption or Repurchase

 Description of accounting policies
 Tax treatment of investments
 Investors’ rights and services
 Redressal mechanism for investor grievances