IVCA Guidance Note
SEBI AIF Annual Activity Report (AAR v6) – Key Clarifications
Date: 29 May 2026
Issued by: Indian Venture and Alternate Capital Association (IVCA)
SEBI has provided detailed written responses to IVCA’s consolidated queries on the AIF Annual Activity Report (AAR v6). This note summarises the key clarifications that AIFs should apply while preparing and filing the AAR for FY 2025-26.
Where relevant, references are to specific AAR tables.
1. Cost of Holding and Reporting Date
“Cost of Investment” vs “Cost of Holding” (Table 14 and related tables)
- SEBI has clarified that “Cost of Holding” means the original acquisition cost of the security. It is not amortised cost and is not net of redemptions or sales.
b) Date for “Cost of Holding as at the end of half year”
- Even though the AAR is annual, where the format refers to cost “as at the end of half year”, SEBI has clarified that for FY 2025-26, funds should report cost of holding as on 31 March 2026.
2. NAV Disclosure – Table 5B
- In Table 5B, if the scheme does not have concentration limits based on NAV, the column “NAV of Scheme at end of reporting period (Rs. Cr)” may be left blank.
- There is no requirement to populate NAV in that column solely for consistency with earlier QCR filings.
3. Cumulative Re-investment Drawdown – Table 5A
Definition (all categories):
- “Cumulative Re-investment drawdown” should reflect proceeds received from portfolio companies which are redeployed into portfolio investments and treated as deemed drawdowns under the fund documents.
Category III open-ended schemes:
- For Cat III open-ended funds, SEBI has expressly clarified:
Where the fund realises dividends, realised gains, etc. and subsequently reinvests them,
the AAR field “Cumulative Re-investment drawdown” may be reported as Zero.
Rationale: such reinvestments are not drawdowns or deemed drawdowns from investors in a commitment-drawdown sense.
Implication
- Cat III open-ended AIFs should report “0” / Nil in this field unless they have an explicit recycling/deemed drawdown mechanism in their fund documents.
4. Co-Investment Related Points – Tables 4A & 4B
a) Co-investment schemes and co-investor columns (Table 4A)
- If “Status of Scheme” is selected as “Co-Investment Scheme”, the last four columns of Table 4A (co-investment related fields) will be deactivated and will not be applicable.
- If any other scheme status is selected, these columns are activated and need to be completed as relevant.
b) Amount held back in wound-up schemes (Table 4B)
- In Table 4B, for wound-up schemes where some money remains due to specific investor issues (e.g. investor debarment, bank issues), SEBI has confirmed that such residual money should be reported as “amount held back”.
5. Angel Fund Reporting – Tables 4A, 4B, 6A
- SEBI has clarified that scheme-wise details need to be provided for angel funds as well. No additional investment-level reporting relief is being provided at this stage.
6. PMS Registration Fields – Table 4A
- The additional field “PMS REG NO” appears due to a technical issue and may be left blank.
- AIFs should continue to provide their SEBI PMS registration number in the correct designated field only.
7. Deviation Reporting – Concept and Mechanics (Table 6A)
7.1 Thresholds and scope (including listed equity)
- SEBI has reaffirmed Clause 22.2.1 of the AIF Master Circular:
At each asset level, if there is a deviation of more than 20% between two consecutive valuations or more than 33% in a financial year, the manager must inform investors of the reasons/factors for the deviation.
Importantly, there is no exception for listed equity portfolios – the requirement applies to listed and unlisted securities alike.
7.2 Absolute vs signed deviation
- Deviation is to be reported as an absolute percentage (number only).
For example, whether the deviation is +15% or -15%, AIFs should enter “15” in the deviation column.
7.3 Whether all deviations must be entered in Table 6A
- SEBI has clarified that the deviation values need to be provided irrespective of the percentage of deviation, i.e. AIFs should enter the deviation % even where it is below the 20% / 33% thresholds.
- The 20 % /33% thresholds continue to drive the investor communication obligation, but the AAR table itself is expected to carry actual deviation numbers wherever applicable.
- Related points already in FAQs
- If there is no deviation, deviation fields may be left blank.
- If the fund has adopted annual valuation only (with investor approval), the column “ % Deviation in value of per unit security in a Financial Year” may be left blank, and only the deviation between two consecutive valuations is reported.
8. Escrow Metrics – Tables 18 and 7H
SEBI has clarified the following:
- Unique number of investors to which Escrow belongs:
Uniqueness is to be determined PAN-wise.
- Percentage of unique investors’ units lying in Escrow account:
(i) Unique number of investors to which Escrow belongs = PAN-wise unique investors whose units are lying in Escrow account.
(ii) Total number of unique investors in the scheme = total PAN-wise unique investors in the scheme.
(iii) Percentage = (i) 4 (ii).
- SEBI has also indicated that it is unlikely that investors would have multiple unit lots with only a portion in Escrow in the same AIF; however, if such a case exists, AIFs should still follow the above formula.
9. Classification of “Other Investor” – Table 7F and Accredited Investors
- In Table 7F, “Other Investor” means investors who:
Do not fall under any other specifically listed category; and
Are not Accredited Investors.
These should be reported under “Non-AI Investors other than Sponsor & Manager”.
- For Tables 7D-7F (Accredited & Other Investors), SEBI has clarified that:
Even if the fund has no accredited investors, the table is mandatory. In such cases, AIFs should enter zero values in the AI Investors column.
10. NISM Certification – Table 3E
- For the current AAR, if the Compliance Officer has not yet obtained NISM certification (within the regulatory timeline), the fields for NISM certification date and expiry in Table 3E may be left blank.
- The NISM details should be filled from the next reporting period once the deadline has passed and certification has been obtained.
11. Other Registrations and Entity Classification – Table 3B
- Where the sponsor/manager has registrations with other regulators (including IFSCA as FME), SEBI has asked AIFs to:
Provide the category of registration with the other regulator and the registration number in the space provided.
Multiple registrations can be disclosed in the same space.
- For partnership/LLP structures with resident individual partners, the appropriate “Type of entity” is:
“Domestic Owned and Controlled Resident Non-individual.”
12. Benchmarking Agencies – Tables 11A and 21
SEBI has clarified the treatment for the field “Whether latest required information submitted to Performance Benchmarking Agencies”:
- Select “Yes” if data pertaining to the reporting financial year has been provided to a performance benchmarking agency at least once within that financial year.
- Select “No” if the last data provided was prior to the reporting financial year.
- Timelines for valuation and benchmarking must be complied with as per the respective regulations/circulars; they do not need to match the AAR filing due date.
13. Management and Distribution Fee Reporting – Table 11B
SEBI has clarified the following:
(1) Management Fee per annum (Rs. Cr)
Should reflect the annualised management fee over the tenure of the fund.
(2) Newly launched / interim close schemes
“Management fee per annum” should be computed based on commitments received till the reporting date (or NAV, as applicable – see below).
“Total Management Fees charged over the tenure (Rs. Cr)” will be automatically calculated by the template.
Open-ended schemes
For open-ended schemes, AIFs should follow the data validation instructions for the
“Tenure of Scheme”; once completed, “Total Management Fees charged over the tenure” will be calculated automatically.
(4) Distribution fees borne by manager
Where distribution fees are not charged to the scheme (only borne by the manager), the relevant fields should be reported as Nil.
(5) Estimate vs actuals
SEBI expects an estimate of full fees during the tenure of the fund, not just fees accrued up to 31 March 2026.
(6) Cat III open-ended schemes with NAV-linked fees
For open-ended Cat III schemes, SEBI has clarified that the total management fees over tenure should be calculated on the basis of the fee base used in the fund documents – i.e. either commitments or NAV of the fund as mentioned in the fund documents and charged to investors.
Accordingly, where fees are purely NAV/AUM-linked and there is no commitment model, AIFs may use NAV (or AUM) as specified in the fund documents as the base for estimating and reporting “Management Fee per annum” and the corresponding totals.
14. Consents Embedded in Fund Documents – Table 4B and Table 7G
- Table 4B – Tenure extension:
“Whether the tenure has been extended” should be reported as “True” if the fund has extended the tenure as per the terms of the PPM, with or without separate investor consent.
If consent is not applicable as per AIF Regulations/circulars, AIFs may report “0″ in “ % Investors by value that approved extension”.
15. Next Steps
IVCA encourages all AIFs to:
- Align their AAR preparation with the above clarifications.
- Review the underlying SEBI AAR FAQ and SEBI’s written responses for any table-specific nuances not summarised here.
- Route any new or residual issues through IVCA so that further clarifications, if required, can be sought in a consolidated manner.
