Any scheme or arrangement made or offered by any company under which the contributions or payments made by the investors are shared and applied with an objective to receive profits or income and is managed on behalf of the investors is a Collective Investment Scheme or CIS. Investors do not have daily control over the management and operation of these schemes or arrangements.
A Collective Investment Management Company is a company formed under the provisions of the Companies Act, 1956 and registered with SEBI under the SEBI (Collective Investment Schemes) Regulations, 1999. The objectives of such companies are to organise, operate and manage a Collective Investment Scheme.
Companies, which were operating and were into a collective investment scheme at the time of initiation of CIS Regulations on October 15, 1999, are deemed to be an existing collective investment scheme. An existing Collective Investment Scheme cannot launch any new scheme or raise money from the investors even under the existing scheme, unless it receives a certificate of registration granted to it by SEBI.
Every investor is entitled to receive a copy of the Balance Sheet, Profit and Loss account and a copy of the yearly appraisal report from the Collective Investment Management Company within two months from the closure of the financial year.
Further, scheme wise un-audited quarterly financial results are published in a national daily by the Collective Investment Management Company within one month from the close of each quarter.
