Transactions Not in Good Order

Mutual Fund Applications and transaction documents that are incomplete or deficient are termed as Not In Good Order (NIGO). While carrying out transaction processing for various Mutual Funds, CAMS follows general regulatory guidelines or the specific instructions of the Asset Management Company responsible for managing the assets of the Mutual Fund in identifying and handling transactions that are NIGO. All applications and transaction slips received at CAMS offices are accepted “Subject to Verification”. Applications & transaction slips may be returned with out processing at the receiving counter itself, or subsequently at the time of a “good order review” either at the Investor Service Center / Transaction Point or at the back office. Scheme default options will be applicable wherever the applications are incomplete. Transactions that meet one or more of the following conditions will be Not In Good Order and will not be processed unless there is instruction to the contrary from the Asset Management Company.

Applications and Transactions are NIGO where

· The critical fields like Investor Name, Scheme, Units/ Amount, Option, Bank Mandate are not completed.

· Where Application form of one scheme is used for another scheme, processing and allotment will be subject to the approval of the AMC.

· Photocopy applications will be processed subject to the approval of the AMC, so long as they contain the original signatures of Investors.

· Corrections or overwriting present on the application in critical fields like Scheme, Plan, Amount, Mode of holding etc.

· Where the cheque is overwritten but not countersigned by the investor.

· Accompanied with postdated cheques

· Where the signature of the investor(s) is/are not in original.

· Applications / transaction slips are sent via fax.

· Are not signed by the investor, or all holders in case of joint accounts.

· Are not accompanied by a signed and valid cheque, instrument or payment advice.

· Not meeting the minimum amount required or multiples as specified in the KIM (Key Information Memorandum) and the Common Application form.

· Submitted by Investors ineligible as per KIM.

· Multiple applications with single cheque

· In case of MINOR applicants if any of the following information is missing:

- Date of Birth

- Name of Guardian

- Signature of Guardian

· For Non Resident investors, where the status of whether investments are Repatriable or NonRepatriable is missing, and the same cannot be determined from the cheque/bank details on the application.

· The complete address of the investor is not available in the application form.

· Investments are made by Corporate Investors / Trusts or Companies, if the necessary supporting documents like MoA / Authorized Signatories List / Board Resolution / Trust Deed etc (as applicable) do not accompany the applications & transaction slips.

· The Investments are made by PoA holder and the PoA is not submitted or the POA is deficient.

· The MIN and PAN details along with MIN and PAN validation documents / Form 60 / Form 61 are not provided for all the holders regardless of mode of holding for transaction values of Rs.50000/- and above.

· UIN number is not provided for specified Investors.

· The investor has not provided complete bank details consisting of bank name, branch name and account number.

· Submitted with outstation cheques at a location where the fund does not have a banking arrangement for collection of funds.

· The existing unit holder information is incomplete i.e. full account number (all digits) as allotted to the unit holder is not provided in the application form.

· Where the appropriate transaction field is not completely filled out by the investor i.e. Units or Amount.

· Where the Investor signature does not match with Investor records

· Units are under lien and the lien release documents do not accompany the redemption request.

· The investor does not hold an account in the scheme mentioned by him/her in the transaction slip.

· The bank details of the investor are not provided (bank, branch and account number)

· The Source and Target Fund/Scheme/Plan details are not provided in the switch transaction request.

Systematic Investments in specified schemes are NIGO where

· The minimum investment criteria is not complied with.

· All the cheques are not for the same amount.

· The application or cheques are not signed by the investors.

· The application is not accompanied by the prescribed minimum number of cheques (6 cheques or 12 cheques as the case may be).

· The dates of the post dated cheques are not as per the prescribed dates.

· Where the option of Fixed Amount or Capital Appreciation is not mentioned in the case of a systematic withdrawal or transfer.

· In case of Fixed Amount systematic withdrawal or transfer. where the amount is not mentioned in the request.

· Source & Target schemes are not mentioned for a systematic transfer.

Scheme Default Options

In respect of applications & transaction slips, where in the options (Dividend, Growth, Dividend Reinvestment, Dividend Payout) are not chosen by the Investors, default options as mentioned in the KIM would be applied, as follows -

· Where payout option not selected, default payout options such as Direct Credit will be applicable as per KIM and application form.

· Where the mode of holding is not mentioned, an application be treated as either SINGLE or JOINT based on the number of applicants/ number of signatures on the form.

· In case the status of the investor is not mentioned, the default status would be Individual, HUF or Company based on the information available in the application form.

· In case more than one investor’s name appears in the application form, but the form has been signed by the first holder only, the same will be processed with the mode of holding as Single in favor of the first holder. However, for Joint holders, both the unit holders must have signed the form else the application will be rejected.

· In case the amount of the cheque, instrument or payment advice differs from the amount of the application, the same would be processed for the amount of the cheque, instrument or payment advice.

· In case the cheque is made in favor of another scheme as compared to the application form, the scheme mentioned on the cheque will be treated as default unless specified by the AMC otherwise.

· If a certain number of units and ‘All Units’ are simultaneously mentioned in the transaction slip for redemption or switch, all the clear units will be considered. Where the number of units and an amount are simultaneously mentioned, the number of clear units will be considered.

· If neither units nor amount are mentioned in the transaction slip, all clear units will be considered for redemption or switch.

· In case the end date for an SIP is not mentioned, the SIP would end once the cheques currently in hand are deposited.

· In case the end date for SWP / STP is not mentioned, the same would be assumed as per the terms specified in KIM.

· In case the starting date of an STP / SWP is not mentioned in the application, the transaction would be processed with the immediate next STP / SWP date depending on the option selected by the investor.

· Broker codes will be processed under UNKNOWN or DIRECT in the following situations:

a) Broker code is corrected but not countersigned by the investor in the application

b) If there are multiple broker codes mentioned in the application

c) If the broker code is not clear in the application

This document is current to the best of our knowledge as of May 2005. For the most current business rules or for specific clarifications, please contact any office of CAMS.