Micro Study Of An Indian Broking House...

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PROJECT REPORT ON

MICRO STUDY OF AN INDIAN BROKING HOUSE AT

INDIA CAPITAL MARKETS PVT LTD., MUMBAI 2008-2010 Submitted to:

Mr.Pravin Salvi VP - E-Broking India Capital Markets

Submitted by:

Noman Agashiwala Krutika Moorjani Reshma Kalamkar

ACKNOWLEDGEMENT

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It gives us great pleasure to present before you, our summer training project report for the year 20082010.

We express our sincere gratitude towards INDIA CAPITAL MARKETS Pvt. Ltd., for giving us an opportunity to work on this report.

We take this opportunity to thank our respected project guide Mr. Pravin Salvi, VP – E-broking, for giving us an opportunity to undertake this project. His guidance has been invaluable to us to while preparing this report. He provided us with valuable suggestions and excellence guidance about this industry, which proved very helpful to us and helped us to gain theoretical knowledge as well as experience in the practical field.

Last but not the least, we are also thankful to Mrs. Priyanka Shelar, and all the staff at India Capital Markets, my friends, to all known and unknown individuals who have given me their constructive advise, suggestions, encouragement, co-operation and motivation to prepare this report.

– Krutika Moorjani (Chetana’s R.K. Institute of Management and Research –MMS) – Noman Agashiwala (Thakur Institute of Management Studies and Research - PG) – Reshma Kalamkar (Chetana’s R.K. Institute of Management and Research –MMS)

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TABLE OF CONTENTS

COMPANY PROFILE.............................................................................................. ...............5 INDUSTRY PROFILE............................................................................................................6 ORGANIZATION CHART OF A BROKING HOUSE...............................................................12 BUSINESS STRATEGY DEPARTMENT................................................................................16 FINANCE DEPARTMENT............................................................................... .....................24 BUSINESS DEVELOPMENT DEPARTMENT........................................................................31 OPERATIONS DEPARTMENT.............................................................................................39 ADMINISTRATION SECTION..............................................................................................52 RESEARCH DEPARTMENT................................................................................................63 COMPLIANCE DEPARTMENT................................................................................ .............69 TECHNOLOGY DEPARTMENT.................................................................................... ........77 HUMAN RESOURCES DEPARTMENT.................................................................................86 CONCLUSION.......................................................................................... ..........................93

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COMPANY PROFILE INDIA CAPITAL MARKETS India Capital Markets Pvt.Ltd. is a leading financial intermediary established in 1999. India Capital Markets Pvt.Ltd. is a Corporate member of National Stock Exchange of India Ltd.(NSE) and Bombay Stock Exchange Ltd.(BSE). The firm offers broking services to their clients on Capital Market Segment and Future and Option segment. It enjoys a large retail network comprising of 200+ terminals spread across the country with client base of more than 25000+ satisfied clients. Moreover it also caters to a host of High Networth Individuals, Corporates and Institutions, both domestic & foreign.

India Capital Markets provides a host of financial services under one roof following a ONE STOP SHOP philosophy. It has a dedicated team of professionals to cater to the variety of services to Individuals, Corporates and Institutions. The team updates its clients with opportunities - with a sense of competitive urgency and risk management. What’s more, their special analysts design customized services for HNI and Institutions.

Over the years India Capital Markets Pvt. Ltd. has played a successful role in client's wealth creation. In the process India Capital Markets Pvt. Ltd. also refined itself, as an investment advisor and is poised to provide complete Investment Management Solutions to its valued clientele.

The following is the product profile of the company. • • • • • • • •

Equity Broking - BSE and NSE Derivatives Futures and Options Internet Broking- Online Trading Commodities Trading - NCDEX & MCX Institutional Broking Depository Services - NSDL & CDSL Arbitrage Portfolio Management Services 5

• • •

NRI Investments Initial Public Offerings (IPO) Mutual Fund Investment

INDUSTRY PROFILE While regulation and reforms have made major improvements in the quality of the equity markets in India, its rapid growth and development are largely due to strong and efficient market intermediation. The robustness of the Indian markets today is attributable to a healthy blend of the quality of market structure and efficient intermediation. Even as several countries are instituting procedures to commence equity derivative markets, India ranks amongst the top five countries globally in this segment, in less than five years of its introduction. This is an example of the proactive and progressive nature of the Indian brokerage industry.

In the last decade, the Indian brokerage industry has undergone a dramatic transformation. From being made of close groups, the broking industry today is one of the most transparent and compliance oriented businesses. Long settlement cycles and large scale bad deliveries are a thing of the past with the advent of T+2 settlement cycle and dematerialization. Large and fixed commissions have been replaced by wafer thin margins, with competition driving down the brokerage fee, in some cases, to a few basis points.

There have also been major changes in the way business is conducted. Technology has emerged as the key driver of business and investment advice has become research based. At the same time, adherence to regulation and compliance has vastly increased. The scope of services have enhanced from being equity products to a wide range of financial services. Investor protection has assumed significance, and so has providing them with education and awareness. Greater need for capitalization has induced several firms to access the capital market; foreign firms are showing increasing interest in taking equity stakes in domestic broking firms. Major developments in equity brokerage industry in India: ➢

Corporate memberships There is a growing surge of corporate memberships (92% in NSE and 75% in BSE), and the scope of functioning of the brokerage firms has transformed from that of being a family run business to that of professional organized function that lays greater emphasis on observance of market principles and best practices. With proliferation of new markets and products, corporate 6

nature of the memberships is enabling broking firms to expand the realm of their operations into other exchanges as also other product offerings. Memberships range from cash market to derivatives to commodities and a few broking firms are making forays into obtaining memberships in exchanges outside the country subject to their availability and eligibility.

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Wider product offerings The product offerings of brokerage firms today go much beyond the traditional trading of equities. A typical brokerage firm today offers trading in equities and derivatives, most probably commodities futures, exchange traded funds, distributes mutual funds and insurance and also offers personal loans for housing, consumptions and other related loans, offers portfolio management services, and some even go to the extent of creating niche services such as a brokerage firm offering art advisory services. In the background of growing opportunities for investors to invest in India as also abroad, the range of products and services will widen further. In the offing will be interesting opportunities that might arise in the exchange enabled corporate bond trading, soon after its commencement and futures trading that might be introduced in the near future in the areas of interest rates and Indian currency.

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Greater reliance on research Client advising in India has graduated from personal insights, market tips to becoming extensively research oriented and governed by fundamentals and technical factors. Vast progress has been made in developing company research and refining methods in technical and fundamental analysis. The research and advice are made online giving ready and real time access to market research for investors and clients, thus making research important brand equity for the brokerage firms.

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Accessing equity capital markets Access to reliable financial resources has been one of the major constraints faced by the equity brokerage industry in India since long. Since the banking system is not fully integrated with the securities markets, brokerage firms face limitations in raising financial resources for business and expansion. With buoyancy of the stock markets and the rising prospects of several well organized broking firms, important opportunity to access capital markets for resource mobilization has become available. The recent past witnessed several leading brokerage firms accessing capital markets for financial resources with success.

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Foreign collaborations and joint ventures 7

The way the brokerage industry is run and the manner in which several of them pursued growth and development attracted foreign financial institutions and investment banks to buy stakes in domestic brokerage firms, paving the way for stronger brokerage entities and possible scope for consolidation in the future. Foreign firms picked up stake in some of the leading brokerage firms, which might lead to creating of greater interest in investing in brokerage firms by entities in India and abroad. ➢

Specialized services/niche broking While supermarkets approach are adopted in general by broking firms, there are some which are creating niche services that attract a particular client group such as day traders, arbitrage trading, investing in small cap stocks etc, and providing complete range of research and other support to back up this function.

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Online broking Several brokers are extending benefits of online trading through creation of separate windows. Some others have dedicated online broking portals. Emergence of online broking enabled reduction in transaction costs and costs of trading. Keen competition has emerged in online broking services, with some of these offering trading services at the cost of a few basis points or costs which are fixed in nature irrespective of the volume of trading conducted. A wide range of incentives are being created and offered by online brokerage firms to attract larger number of clients.

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Compliance oriented With stringent regulatory norms in operation, broking industry is giving greater emphasis on regulatory compliance and observance of market principles and codes of conduct. Many brokerage firms are investing time, money and resources to create efficient and effective compliance and reporting systems that will help them in avoiding costly mistakes and possible market abuses. Brokerage firms now have a compliance officer who is responsible for all compliance related aspects and for interacting with clients and other stake holders on aspects of regulation and compliance.

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Focus on training and skill sets Brokerage firms are giving importance and significance to aspects such as training on skill sets that could prove to be beneficial in the long run. With the nature of markets and products becoming more complex, it becomes imperative for the broking firms to keep their staff continuously updated with latest development in practices and procedures. Moreover, it is mandated for certain types of dealers/brokers to seek specific certification and examinations that 8

will make them eligible to carry business or trade. Greater emphasis on aspects such as research and analysis is giving scope for in-depth training and skills sets on topics such as trading programs, valuations, economic and financial forecasting and company research. ➢

From owners to traders A fundamental change that has taken place in the equity brokerage industry, which is a global trend as well, is the transformation of broking from owners of the stock exchange to traders of the stock market. Demutualization and corporatization of stock exchanges bifurcated the ownership and trading rights with brokers vested only with the later and ownership being widely distributed. Demutualization is providing balanced welfare gains to both the stock exchanges and the members with the former being able to run as corporations and the latter being able to avoid conflict of interests that sometimes came as a major deterrent for the long term growth of the industry.

Emerging challenges and outlook for the brokerage industry Brokerage firms in India made much progress in pursuing growth and building professionalism in operations. Given the nature of the brokerage industry being very dynamic, changes could be rapid and so as the challenges that emerge from time to time. A brief description on some of the prospects and challenges of the brokerage firms are discussed below.

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Fragmentation Indian brokerage industry is highly fragmented. Numerous small firms operate in this space. Given the growing importance of technology in operations and increasing emphasis on regulatory compliance, smaller firms might find it constrained to make right type of investments that will help in business growth and promotion of investor interests.

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Capital Adequacy Capital adequacy has emerged as an important determinant that governs the scope of business in the financial sector. Current requirements stipulation capital adequacy in regard to trading exposure, but in future more tighter norms of capital adequacy might come into force as a part of the prudential norms in the financial sector. In this background, it becomes imperative for the brokerage firms to focus on raising capital resources that will enable to give continuous thrust and focus on business growth.

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Global Opportunities 9

Broking in the future will increasingly become international in character with the stock markets being open for domestic and international investors including institutions and individuals, as also opportunities for investing abroad. Keeping abreast with developments in international markets as also familiarization with global standards in broking operations and assimilating major practices and procedures will become relevant for the domestic brokerage firms. ➢

Opportunities from regional finance Regional economic integration such as that under the European Union and the ASEAN have greatly benefited businesses in the individual countries with cross border opportunities that helped to expand the scope and significance of the business. Initial measures to promote South Asian economic integration is being made by governments in the region first at the political level to be followed up in regard to financial markets. South Asian economic integration will provide greater opportunities for broking firms in India to pursue cross border business. In view of several of common features prevailing in the markets, it would be easier to make progress in this regard.

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Product Dynamics As domestic finance matures and greater flow of cross border flows continue, new market segments will come into force, which could benefit the domestic brokerage firms, if they are well prepared. For instance, in the last three to four years, brokerage firms had newer opportunities in the form of commodities futures, distribution of insurance products, wealth management, mutual funds etc, and as the market momentum continues, broking firms will have an opportunity to introduce a wider number of products.

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Competition from foreign firms Surging markets and growing opportunities will attract a number of international firms that will increase the pace of competition. Global firms with higher levels of capital, expertise and market experience will bring dramatic changes in the brokerage industry space which the local firms should be able to absorb and compete. Domestic broking firms should always give due focus to emerging trends in competition and prepare accordingly.

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Investor Protection Issues of investor interest and protection will assume centre stage. Firms found not having suitable infrastructure and processes to ensure investor safety and protection will encounter constraints from regulation as also class action suits that investors might bring against erring firms. The nature of penalties and punitive damages would become more severe. It is important for brokerage firms to establish strong and streamlined systems and procedures for ensuring investor safety and protection. 10

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ORGANIZATION CHART OF A BROKING HOUSE Chairman

Secretary Board of Directors

CEO/ MD

CSO/ VP- Business Strategy

CMO/ VP- Business Development

CTO/ VPTechnology

CRO/ VP- Research

CFO/ VP- Finance

COO/ VPOperations

CCO/ VPCompliance

VP- Human Resources

Principal Officer

The above is a simple basic organization chart of a typical Indian broking house. The broking house like any other company has a Board of directors, headed by a Chairman. The Board provides the vision and the mission to the broking house. The Board plans and formulates the goals for the broking house, and directs the Chief Executive Officer or the CEO. The main responsibility of the CEO is to achieve the goals and the mission formulated by the Board through specialized teams under him. These specialized teams are departments in a broking house. He provides executive directions to around eight departments that include: • • • • • •

Business strategy Business development Technology Research Finance Operations 12

• •

Compliance Human resources

Each of the above department is headed by a chief officer and has various managers to perform specialized functions. A more detailed structure till the lowest level of management is given below:

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CHAIRMAN

Secretary

BOARD OF DIRECTORS

CHIEF EXECUTIVE OFFICER

CSO/ VP - Business Strageties

CCO/ VP - Compliance

PRINCIPAL OFFICER

Manager - MIS

Manager - Operations Compliance

Assistant’s

Manager - Corporate Compliance

Manager - Corporate Communication

Manager - Business Development Compliance

Executive Corporate Communication

Manager - Legal

CMO/ VP - Business Development

Manager - Audit Manager-Lead Management Manager-Sales

Audit Officer CTO/ VP - Technology

Sales Executive

Manager-IT Support

Manager-Marketing

Manager-Data security and backup

Business Development Executive Product Head

Manager-IT Operations COO/ VP - Operations

Manager-Software development

Manager-Settlement

Software Development Officer

Manager-Risk Management

CFO/ VP - Finance

Manager-Customer Service

Manager - Corporate Investment

Manager-Admin

Manager-Accounts Executive -General accounts

Manager-Account Opening

Executive - Corporate accounts Manager-Dealing CRO/ VP - Research Manager-Mutual Fund Research Manager-Currency Research Manager-Derivatives Research Manager-Equity Research Manager-Commodity Research

VP - Human Resources

Manager-HR Operations Executive-HR Operations Manager-Staff benefits and PR Executive -PR Manager-Recruitment and Training Executive-Recruitment

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The above tree shows us key departments under a VP and enlists his key functions.

Each Vice President formulates the goals and the targets for his department, on the basis of the objectives of the organization. These goals are communicated to each manager in each department, who further plans the working of his team.

The processes followed by each department in order to achieve their objectives and the key responsibilities of each person in a department, till the lowest levels of hierarchy are given below.

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BUSINESS STRATEGY DEPARTMENT

“If you fail to plan, you plan to fail.” So goes the famous saying. This sentence aptly highlights the importance of business strategy department. This department comes directly under the CEO and provides strategic vision and direction to the organization. This department in co-ordination with CEO drafts and oversees the overall strategy planning and implementation in the organization.

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Organization chart for Business Strategy department

CSO/ VP- Business Strategy

Manager – Corporate Communications

Corporate Communication Team

Manager - MIS

Assistant

Processes flow in Business strategy department As seen above, the business strategy department has three distinct teams working under the Chief Strategy Officer – Corporate communications and MIS. The processes followed in these departments are depicted below using flow charts.

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Corporate Communications process

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Corporate Communications process

Determine what is to be communicated

Designing the communication process as per department needs

Evaluate the requirement of resources

Arrange the resources

Sample ok

Check and verify the sample

Design the communication material

Monitor the success

END process

Yes

No

Execute the process

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Strategy implementation process

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New strategy drafted by CSO/CEO as per directions of BOD

Study the new strategy

Determine strategy implementation procedure

Delegate new process/targets/ polocies to concerned departments

Solve queries of employees on strategy implementation

Arrange training for staff

No

Queries solved

Yes

Implement strategy

No

Request and examine MIS reports

Implementation as per procedure

Yes

END process

Report to CSO

MIS process 21

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MIS department process flow

Collection of data from various departments

Sorting and segregation of data

Database

Request for data from a department

END process

Write query for the data

Report is generated

No

Present data as per requirement

Information need is fulfulled

Send report to the concerned department

Yes

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KRA Guidelines for Business strategy department

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CSO/VP – Business Strategy The VP – Business Strategy is the right hand of the CEO. The Business Strategy Department provides strategy-based planning, consulting and advisory services that enable the company, its subsidiaries and divisions to develop, align, communicate and execute strategies. The Vice President within the Corporate Strategy and Planning Group, partners with senior management to address a variety of corporate strategic issues, with a focus on disciplined management of long term profitable growth, diversification of the markets and products in which we compete, relationship strategies with customers and business partners, and definition of strategies related to cross – segment business issues. Primary responsibilities include: ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

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Corporate strategy project-based research and analysis Corporate strategic plan development and support Scoping, planning and executing research and analysis to support corporate strategy decisions Contributing to building and managing the long term corporate strategic vision and plan Building and managing relationships with senior executives Supporting alignment and communication around the corporate strategy Performing special projects on corporate strategy issues Making presentations to management regarding analysis, findings, and recommendations Special projects

Manager-Corporate Communications A Corporate Communications Manager creates implements and oversees communication programs that effectively describe and promote the organization and its products. They often assist in the preparation of presentations and/or speeches geared toward employees and consumers. It's not uncommon for them to provide supervision and direction to staff. The Corporate Communications manager would: ➢

Develop and manage a direct relationship with key local and industry media editors, writers and reporters 24

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

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Prepare or edit organizational publications for internal and external audiences, including employee newsletters, company background and brand messaging Manage all internal and external communication Develop and maintain a proprietary media database complete Coordinate PR coverage for key events Support Design Services with editorial and copywriting and editing Manage the collection and archiving of press clips and media coverage Collaborate with the marketing managers in the development of communication plans and strategies to help achieve objectives Provide guidelines and message points for corporate personnel authorized to with the media Manage business relationships with external communication resources Manage working relationship with licensor and key partner PR resources Establish policies, standards and overall brand message points to maintain consistency across all communications Work with VP - Marketing and Marketing Managers to execute marketing initiatives Develop public relations strategies that will influence public opinion or promote ideas, products and services Prepare and deliver speeches to further public relations objectives Work with marketing research resources to gauge public opinion of the company and the brand

Corporate Communications team The function of the Corporate Communications team is to assist the Corporate Communications manager to perform his duties efficiently. This team performs the following functions: ➢ ➢ ➢

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Assist the work of the corporate communications manager Proved support to the manager to perform his duties such as strategy planning, analyzing market environment and conditions, suggesting ways and means to tap the market etc Work out all the plans of the manager – Corporate Communication and implement the plans on his behalf

Manager - MIS The role of MIS manager includes coordinating and centralizing all group demands, preparing status reports, supervising your standards, procedures, policies, work instructions and methodologies adopted during the implementation phase. 25

He will be in charge of the making sure that the modules are delivered on time, and informing the management about any obstacles faced. The MIS manager is responsible for the following tasks: ➢ ➢

➢ ➢ ➢

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Supervise the safe use of the system by the various operators, with respect of the procedures of the company as per the accounting rules and principles Edit and print frequently the appropriate management reports while checking and inspecting the results; these reports must be programmed on a daily, weekly or monthly basis and distributed the concerned departments Submit on regular basis a set of reports to the management and head of departments (Weekly, Monthly, Quarterly etc) while checking and auditing the results Organize and customize the training of the remaining users in all locations according to their profile Consolidate from all the branches and departments, the new requirements, needs or problems. In case some new demands are to be charged, he will debate the matter with the management prior to giving his final approval. Consequently, this coordinator will sign the delivery forms and will approve / testify the time sheets submitted in our “service reports”. Make sure adequate backups are done properly and regularly require a monthly backup from the branches data to be stored in the head office server for financial consolidation purposes and part of the end of month reports that need to be audited and controlled

Assistant to CSO The assistant to the Chief Strategy Officer primarily assists the CSO in performance of his duties and responsibilities. His duties include the following: ➢ ➢ ➢ ➢

Works as a Secretary to the CSO Manages all the paper work for the CSO Prepares the presentations for the CSO on his behalf Answers the calls of the CSO on his behalf

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FINANCE DEPARTMENT

Importance of a finance department cannot be over-emphasized. It is, indeed, the key to successful business operations. Without proper administration of finance, no business enterprise can reach its full potentials for growth and success. The finance department looks after overall financial activities in the organization. Maintaining accounts, preparing budgets, finding new avenues of raising capital and investing opportunities, and ensuring proper financial health of the organization, are some of the responsibilities of this department.

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Organization chart for Finance department

CFO/ VP - Finance

Manager – Corporate Investments

Manager Accounts

General Accounts Team

Corporate Accounts Team

Process flow for Finance department The finance department comprises of two primary teams – accounts and corporate investments. The accounts team is further divided into two sub-groups – one maintains corporate accounts for the broking house and the other maintains general accounts of the clients and the business associates. The work flow of these teams is depicted in the diagrams below.

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Corporate Investment process flow

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Determine amount of funds for investment

Define objectives and risk tolerance level for investment

Execute the portfolio strategy

Yes

Find out various areas of investment

Evaluation of options in terms of objectives

Approval from CFO

Design a portfolio

No

Monitor the investment in terms of return and risk

Determine if it achieves the objective

No

Yes

END process

Adjust portfolio

Accounts process flow 31

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Transaction takes place

Record transaction in journal

Post entries in ledger

Trading of shares by clients

Maintain statement of accounts

Reconcile bank accounts

Record transaction in client ledger

Record receipt/ payment of cash

Credit dividend to client accounts

Record receipt of dividend on behalf of clients

Record earnings

Prepare trial balance

No

Yes

Send financial statements to CFO

Approved

Prepare final accounts as per regulatory requirements

Send to Accounts manager for approval

END process

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KRA Guidelines for Finance department

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CFO / VP-Finance The Chief Financial Officer is the top financial position in any organization. He is in charge of the overall finances of the firm and is responsible for the inflow as well as the outflow of funds in the firm. He advises on any decision that has financial implications. His primary responsibilities include: ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

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Directing and controlling all aspects of financial administration in line with the strategy of the firm Ensuring compliance of all statutory requirements and best accounting and business practice Developing, managing and implementing the budgets Determining the Capital structure of the firm and the Capital requirements Anticipating the requirements of funds and making arrangements for the same through banks, financial institutions etc Deciding the areas where the funds of the firm would be invested Evaluating the financial activities in the firm and ensuring profitability Ensuring that appropriate controls and systems are in place for the managing and monitoring all aspects of cash flow, budgetary procedures Advising the Board of Directors regarding any areas of concern Ensure that the annual statutory accounts are prepared and completed in line with the SEBI regulations and are of the highest standard

Manager-Accounts The accounts manager has two teams to support him – general accounts team and corporate accounts team. The general accounts team primarily deals with the accounts maintenance with respect to clients-individuals as well as business associates. The corporate accounts team, on the other hand deals with the accounting requirements of the organization. Thus, the basic duty of the accounts manager is to handle and manage the two teams.

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General accounts team The General accounts manager is primarily responsible for handling the funds of the clients. All the transactions related to margin amount, cash receipts and payments to clients are recorded by the general accounts team. The responsibilities of the general accounts revolve around the transactions of the clients and business associates and include the following: ➢ ➢ ➢ ➢ ➢ ➢ ➢

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Manage the Client pay-in/pay-out procedures Maintain client ledgers and verify the books of accounts Ensure that statement of accounts are sent periodically to clients Maintain proof of statement of accounts and margin details of clients Verify details of cash receipts and payments to clients Maintain records of dividend receipts on behalf of clients and credit them to the respective client accounts Maintain client-wise scrip-wise record of transactions

Corporate accounts team The Corporate accounts team, unlike the general accounts team would be involved in handling accounts of the broking house. All transactions entered into by the broking house would be recorded by this team in the books of accounts. The responsibilities of the corporate accounts team are as follows: ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Reconcile the firm’s bank accounts Maintain accounting records and prepare financial statements Finalize the financial statements for use of external parties like government, suppliers, creditors, shareholders etc Analyze financial statements and prepare reports Maintain books of accounts, registers, and records as per regulatory requirements Maintain exchange wise books of accounts Ensure working capital needs are met by maintaining relationships with banks, financial institutions etc Maintain tax information to assist in tax planning Make payments related to day-to-day expenses, periodic salary payments etc.

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Manager – Corporate Investments The Corporate investment manager handles the overall investments made by a firm, in consultation with the CFO/VP – Finance. Decisions related to investment of the surplus generated by a firm are made by him. His profile includes constant study and research on the following areas: ➢ ➢ ➢ ➢ ➢ ➢ ➢

Make and review investment plan for the firm periodically Finding out various areas where the funds of the firm can be invested Evaluating and deciding the various options of investment Ensuring that the invested funds produce a satisfactory return for the firm Maintaining a healthy balance sheet for the firm by ensuring preservation of capital and maintenance of sufficient profit fund Deciding on the return to be given to stakeholders in the form of dividends etc. Maintain investment transactions of the firm like mergers, acquisitions, takeovers and advice the management accordingly

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BUSINESS DEVELOPMENT DEPARTMENT

The main function of the Business development department, as the name suggests, is to develop the business of the broking house and increase its client base. No doubt, it is one of the most important departments for the firm as it a strong business development team directly translates into revenues for the firm. The function of this department does not is not just to acquire new clients but to also maintain good relationship with existing clients and encourage them to do more business with the firm.

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Organization chart for Business development department

CMO/ VP – Business Development

Manager Marketing

Manager - Sales

Marketing Team

Sales Team

Lead Management

Product Head

Process flow of Business development team The business development department comprises of three divisions, namely marketing, sales and lead management. Although they are three distinct divisions, their work is highly inter-related and hence their work process is cannot be separate from each other. The combined process followed by this department is given in the process chart below.

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Marketing, Sales and Lead Management process flow

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Marketing & Sales Department Database

Automated Data Update

Corporate Communication

Lead Data

Lead Management

Sales Data

Sales

Prospects Organizing Events, Promotions & Advertising

Generate various MIS Using central Database for Top Management

Process raw data according to – Location, Client Matrix, Product & Priority

Colleting Data with Sales Dept

MIS Server

Allocate the processed data to Tele-Sales Dept

Automated Data Updater

Team Leader/ Manager segregates the data and provides to his team of Sales Executive also takes the feed back form them

Sales Executive Maintaining Web Site (Contents), Designing & Structuring – Promotional Material

Tele -Sales Dept

Allocate Data to Lead Manager & take Feedabck

Response

Meeting/ Follow-Up

Calls on the Data

Feed Comment & End

If - ve

Capture responce

Capture responce

+ ve

Here; The Blue Lines Shows the one way flow and the Red Lines Show the two way flow.

If + ve

Sales Data is automatically updates Tele – Caller need to Follow Up with Sales Executive & Up date the status

Update the response to TeleCaller & reporting supervisor

End Process

End Process

Start Account Opening procedure

Submit Documents & Form to A/c Opening Dept

Follow-up and inform the status to client; maintain healthy relation with client

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KRA Guidelines for Business Development department

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Chief Marketing Officer/VP-Marketing The Chief Marketing Officer plans the activities for developing the business of the broking house. He undertakes activities to generate new business for the firm as well as maintain relationships with new and existing clients. The CMO works in close co-ordination with the Corporate Communications manager with respect to the marketing activities. His profile of responsibilities includes the following:

➢ ➢ ➢

➢

➢

➢

➢ ➢ ➢

Responsible for transitions' overall brand company’s focused on building brand awareness and equity globally Responsible for elevating and expanding the brand to the consumer in order to achieve and sustain brand awareness Drive strategies to ensure the brand becomes aspirational and educational vis-à-vis the consumer via an integrated marketing plan utilizing all elements of the traditional and nontraditional marketing mix Responsible to influence professional-specific communications and initiatives so that they also represent transitions as both an aspirational and educational brand that helps the professional audience becomes true advocates of transitions lenses to their patients, resulting in greater recommendations, prescriptions, and thus higher conversion rates and penetration Develop programs and initiatives to achieve the above strategies. In turn, he/she must then effectively collaborate with the regional general managers and marketing directors toward global brand consistency and ensuring the effectiveness of the marketing programs within the regions Assist the regions in the development of the overall communication strategy and branded communications based on brand metrics. This includes TVC, Consumer and Trade print campaigns, and global advertising (media) or promotional campaigns Provide brand guidance to the regions with respect to retail marketing as they customize their programs for the respective retailers Assist the regions in the development of education programs for retailers Oversees the management of department budget and budget reporting

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Manager-Sales The sales manager is responsible of the sales of the products and the services of the broking house. He is supported by a team of sales executives. His duties include: ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

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Lead the sales team to achieve short term and long term sales objective Strengthen distribution set up Identify new markets for growth Strengthen depth and width of distribution Analyze financial requirements of customer and match with company's product offerings Develop sales plan for each financial product of company Set objectives and goals with targeted date of achievements Prepare and execute action, plan to achieve these objectives Allocate sales resources to optimize sales and profit targets Recruit advisors and achieve sales targets through them Achieve expected minimum sales target on a consistent basis Continuously review performance and set new targets Manage relationship and provide services to existing and new clients Ensure acquisition of HNI clients Motivate and train sales team

Sales team (Sales executive) ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Maximize the sales of a company's financial products and services. Ensure the commercial success of a diverse range of company's financial products and services Identify new markets and business opportunities Responsible for increasing and developing sales in allotted areas Visit potential customers to prospect for new business Act as a contact between a company and its existing and potential markets Negotiate the terms of an agreement and closing sales Gather market and customer information Record sales and order information and send copies to the sales office Generate sales through leads given by the lead management team

42



Manager-Marketing ➢ ➢ ➢ ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Responsible for developing the marketing strategy that will be put into place by a business or firm. Oversee the work of other employees like market research manager, research manager, product development manager in order to accomplish the marketing objective Determine the demand for the company’s product or service and attempt to identify the target market like wholesalers, business firms, government agencies, retailers, or the general public Responsible for developing a pricing strategy in order to help the firm get the most profits while also making sure customers are satisfied. Monitors trends in order to determine when new products or services should be introduced by working collaboratively with product development specialists, sales and other managers Responsible for working with promotion managers and advertising managers in order to help promote the product or services and to attract new customers. Evaluate the financial aspects of product development, such as budgets, expenditures, research and development appropriations, and return-on-investment and profit-loss projections Formulate, direct and coordinate marketing activities and policies to promote products and services, working with advertising and promotion managers Direct the hiring, training, and performance evaluations of marketing and sales staff and oversee their daily activities Develop and manage relationships with company’s clients at all levels Conduct in-depth financial products demonstrations, working closely with sales reps who manage the account Cultivate relationships with key opinion leaders in pathology Develop and execute campaigns to educate the market on various financial products and services offered by company Develop commercial launch and marketing plans with budgets to support the overall business plan and strategy through integrated campaign techniques Work closely with Product Managers to ensure the benefits and features of the products are well articulated as per the needs and preference of consumers

Marketing team (Business development executive) ➢ ➢

Responsible for areas such as selling financial services and products Maintaining relationship with clients and providing business leads, client interaction, team building, follow up with clients 43

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Lead management ➢ ➢ ➢



Understanding the requirements of the clients & positioning an appropriate solution. Would be able to travel on demand as per the Company Policy Provide company's products and services that best suit customers' planning Use the sales process and deliver excellent service Work as part of a team and contribute to their success and minimize risk by following procedures Ability to handle corporate presentations, documents, proposals, and managing the expectations of the customers Ability to manage the relationship at various levels in the clients Driving the Sales revenues & achieving them Identify potential customers, manage existing account/customer relationships Resolve/coordinate customer complaints effectively Control and achieve prescribed sales budget Monitor competitor’s offering, prices and sales

Generating leads for the company Passing on the leads to the sales department Keeping follow up of leads

Product Development Head The product development head is responsible by designing and introducing new products and services for its customers as per the market and customer requirements. His key duties include the following: ➢ ➢ ➢ ➢ ➢ ➢ ➢

Analyze market trends and identify potential markets Ensure effective new product launch Research, analyze and recommend opportunities to develop and launch new products for the brokerage firm Regularly undertake industry analysis, company analysis, and product analysis Identification and segregation of potential market Segments Constantly monitor market, competitor and product developments to identify opportunities that provide competitive advantage Development of products in the brokerage firm like risk management products, insurance products, mortgage products and other lending activity related products 44

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Define and document all products requirements and tasks Providing inputs on product features and help define product specifications Measuring product performance and identify key factors of improvement like product design Act as a link between research, marketing and sales to evaluate and identify new products that will meet the needs of the customer Revenue generation through new account development and key account management Arrange pre-sales development discussions with other product development and sales personnel and third-parties to understand their business models and requirements Provide training to field staff for product knowledge, proper planning and implementation of decided strategy Deliver weekly reports on status of the schedule, missed tasks, targets achieved and identified risks Keep the CMO updated on product status and potential issues Work closely with the CMO to identify gaps in core product functionality and content offerings as well as to assign priority to key product areas for development Develop, manage and maintain a strong, competitive product portfolio to support business objectives

45

OPERATIONS DEPARTMENT

The operations department looks after the daily operations and day-to-day working activities of the company. The people working in this department come directly in contact with the clients of the firm; hence the efficiency of the people working in this department directly reflects the efficiency and the service of the firm. The activities of this department range from collecting documents for account opening, providing efficient customer service to managing risk and maintaining relations with business associates. 46

Organization chart for Operations department

COO/ VP- Operations

Manager – Account Opening

Manager – Risk Management

Account Opening Team

Client Risk Team

Manager - Dealing

Manager Administration

Dealer

Associate Risk Team

Risk Operations Team

Manager – Customer Service

Client Service Team

Manager Settlement

Business Associate Service Team

Funds Settlement Team

Security Settlement Team

Funds pay in & pay out team

Security pay in & pay out team

Process flow of Operations department The operations department has the most varied nature of functions. Right from opening the demat account of the client, managing the risk, providing him customer service to dealing and advising him on investing and settling the orders; all these form a part of this department. Various process charts below depict the functioning of this department and its members. 47

Account opening process

48

Account Opening Department Receive Forms form Marketing Dept or from Dispatch Dept. (courier)

Send Forms & Documents back to source

Rejection

Document & Form Scrutiny as per KYC Norms

Data Entry in Back Office Software's Opens Demat A/c, Mentions the DP Client ID on the Form, Generates Client Master and attaches it in Documents

Objection

ERROR

Note: The Verification in done between3 Records; 1. Document Submitted 2. Details Entered in Form & 3. Details Entered in Back Office Software's

Verification

All OK

Demat: Account Opening Department

NO

Contact Client/ Marketing Exe and clear the objection in 3-7 days else mark as rejection

Does Client has a Demat A/c

YES The Verification Department authorizes the software to Open Account

IF the UCC/ UCI reports comes with a error then; with the error details the forms are send back to scrutiny Team

The Authorized accounts are picked up for UCC & UCI upload (EOD)

Error

UCC/ UCI status report from Exchange

If Report is OK The UCC/ UCI team marks the Client Status Active

A Automated Welcome SMS/ Email is send . Also, Welcome Letter is Printed and given to Dispatch Dept

Tele-Sales Dept gives a Welcome call to Client informing that this A/c is Open and he can start trading/ investing.

Details are forwarded to IT departments to create & activate Client in Trading Software/ Dealing Terminal

Physical Form Storage

RMS department is informed so that the limits are Set

49

Risk Management process

50

Pre Market

Risk Management

Start

Debit in end client > 5 days?

Upload the limit file on the ODIN terminals

Create the limit file as per policy norms

Approval for debit limit for any branch/ sub broker ?

No

Monitor debits of sub-brokers

Yes

Live Market

Yes

Square off position

Approval from higher authority

Increase limit

Market highly volatile

No

Yes

No In case of loss square off open position

Post Market

Check Market conditions

Phone calls to sub brokers and end clients

Warning call to the clients

End

51

Dealing process

52

Pre Market

Check for any latest events and updates

Study the fresh market conditions

Update your knowledge by reading daily reports

Take and execute premarket orders

Incoming Voice Call

Customer Verification: Client Code Mobile Number Email Address Date of Birth

END CALL

RE VERIFY Client Data Verified

NO

Give appropriate answer

Transfer to Customer Service Department

YES Accept & Place the Order

Limit Order

Order Status

FAILED/ ERROR

Inform the Client & transfer the Call to CSE with Error Log

Market Order

FAILED/ ERROR

Order Status

CONFIRMED

EXECUTED

Inform Client EXACT Order Details

Inform Client EXACT Trade Details

PENDING

Inform Client & act as per his Request

Post Market

END CALL

Make client confirmation calls

Communicate updates to clients

Find out error trades and make changes, if any

Execute option exercise orders

53

Settlement process

54

Settlement Cycle Sell

Buy

A Investor Places Order

Trade Date = T

Credit In Client Ledger A/c

Does Client has Shares in his Demat A/c

NO

Debit In Client Ledger A/c

Broker Intimates Exchange – “Short PayIn”

Broker arranges fund on his behalf

T+1

NO

Does Client has sufficient Funds in his A/c

T+1

YES

YES

Shares are arranged in PayIn Pool A/c

Funds are Paid to the Exchange Process of Settlement of Funds & Shares in Clearing House

T+2 Exchange will Credit Funds in Broker Settlement Pool A/c

NO

Is there a Short PayIn

Exchange will Credit Shares in Broker Pool A/c

NO

Broker will check Clients Ledger A/c

YES Exchange Call for Auction

Broker will Dr. Auction penalty + Credit given against Sale of Sh to Client A/c

Exchange will collect Auction penalty from broker of Seller & pay to Auction Seller

Credit

Debit

T+3 T+5

Did Exchange received required Sh. In Auction NO

YES

Shares are arranged in PayIn Pool A/c

T+5

Broker will maintain Sh in Pool A/c till the client clears Dr.

Broker will sell the Sh. & Cr. Clients A/c

T+6

Exchange will call for Replacement of Bad Delivery

Did Exchange received required Sh. In this Auction

T+8

NO

Exchange will pay back PayIn Funds + Close Out Penalty to Broker

Exchange will process “CLOSEOUT”

Exchange will collect Close Out Penalty from Broker

T+9

T+9

Broker will Cr. Clients A/c with funds received from Exchange

Broker will Dr. Close Out penalty + Cr. against sale of Sh to Client A/c END Process

55

Customer service process

56

Queries

Through Email/ Website

Through TelePhone

Live Chat Service

Customer Verification: Client Code Mobile Number Email Address Date of Birth Queries Database Client Data Verified

NO

YES

Forward to Marketing Department

NO

YES Data Update

Marketing Related

Accept & Document Query

Give appropriate answer

Informative

Action Required

Provide the Required Information

Forward to Approprate Dept.

END

END

Follow up with Dept & keep the client informed NO

Data Update

Escalate to higher authorities & Follow UP

After 48Hrs

Is the Query Solved

END

57

KRA Guidelines for Operations department



Chief Operations Officer/VP-Risk Management The COO / VP- Operations plans, directs, and coordinates operational activities at the highest level of management with the help of subordinate managers. He/ she is responsible for handling various procedures adopted by the different departments under his/her control which includes account opening, dealing, settlement, admin, risk management and customer service. The duties are: ➢

Within the Investor Dimension • Profitably manage rapid recent growth and future expansion plans • Plan and execute for the short/medium and long range horizons • Consolidate all business units and shared services into one cohesive unit • Integrate newly acquired entities and capabilities into one organization • Lower cost through optimization of people, processes, technologies • Squarely meet and overcome operational challenges • Replicate best practices across business units/entities/acquisitions • Succession Planning for CEO (when CEO is closer to retirement) • Succession Planning for CEO (for crises that cannot be planned for)

➢

Within the Client Dimension: • To accomplish market dominance from present market leadership • To be the executive owner for major clientele • To plan, build and deliver even greater value to customers/partners • To improve profitability of existing client contracts thru price revisions • To win new profitable business in new markets/new geographies

➢

Within the Employee Dimension: • Provide inspirational people leadership for the management & employees • Integrate people through vision, mission, values and organizational structure • Manage day to day operations through effective action oriented approach • Ability to build managers, domain competencies and unleash innovation

➢

Within the Management Team: • Ability to build a trust based relationship with the CEO • Ability to collaborate with a Founder CEO if CEO is Founder or 58

•



Ability to collaborate with a Professional CEO (as the case may be)

Manager-Account opening The Manager – account opening is responsible for the supervision of the entire procedure of account opening which includes procuring a client, getting the documents duly filled, verification of the documents, as well as updation of new information. For this he/she has a team working under him. His duties include the following: ➢ ➢ ➢ ➢ ➢ ➢



Verify whether KYC, MCA/ TPA, RDD are executed in the prescribed formats and the same is executed before execution of trades for the client Verifies all the financial details of the clients and checks whether all the fields in the KYC are filled as per SEBI norms Checks whether proper proof of identity, PAN and proof of address are taken Checks whether person verification of the clients are done by the employees working in the team under him Checks whether date of verification, name and signature of the official who has done inperson verification and the member’s stamp is incorporated in the client registration form Checks whether all the details of the client including financial details are updated periodically

Account opening team The account opening team works in assistance with the manager – account opening. This team assists the manager in client registration and documentation process. The responsibilities of the account opening team are: ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢

Ensures and checks whether the documents like Know Your Client (KYC), Member Constituent Agreement (MCA)/ Tripartite Agreement (TDA) and Risk Disclosure Document (RDD) are in place Verifies the formats in the documents along with the attachments and also checks the clauses mentioned Maintains the system of storage of client registration documents and its retrieval Explains the procedures to acquaint the new client Periodic review of the client information and its updation Helps the Manager in procuring new clients In- person verification of the clients Assists in the procedure of delivery of the client registration details to the clients

59



Manager – Risk Management Risk Management is an important function for a broking firm. The duties of the manager are as follow: ➢ ➢ ➢ ➢ ➢ ➢



Planning, organizing, reviewing and evaluating the work of the staff based on risk management practices Ensuring sound guidelines for risk management capabilities based on market risk, credit risk, operational risk Work with subject matter experts in key areas of risk management across buy-, and sell-side clients, as well as brokerage Define critical gaps in capability, design a recommended future state, and outline an implementation strategy Prepare and obtain bids based on sound insurance benefits Prepare strategies to hedge risk for the clients

Client Risk Team These are the direct clients with the broking house without having any associates. Sometimes the clients want their credit limit to be increased for trading that is when this team comes into the picture. Their duties include: ➢ ➢ ➢



Check the credit history of the client and determine whether the limit can be increased for the client. Keep a check on the trading pattern of the client once the limit is increased Responsible for collection work from these clients

Associate Risk Team ➢ ➢ ➢

Managing the risk of associates like brokers, sub-brokers etc. Keep a check for cases where the broker may default on the customer Keep a check on the deposits from the sub – brokers and the brokerage

60



Risk Operations team ➢ ➢ ➢ ➢

➢ ➢ ➢

➢ ➢



Develop and direct the implementation of goals, objectives, policies, procedures, and work standards for the risk Management department Plan, organize, assign, review, and evaluate the work of assigned staff Perform comprehensive review and analysis, and develop recommendations regarding the Company’s insurance needs; Develop insurance specifications and prepare all statistical data to provide prospective underwriters with specifics for rating premiums and analyze and recommend appropriate levels of self-insurance retention and policy limits Monitor insurance or risk management-related legislation, legal cases, and court decisions in order to evaluate their impact on the company Develop recommendations or implement technical, policy and procedural modifications as necessary Confer with and provide professional assistance to various company departments on risk management related matters and makes presentations to management staff or other departments Develop and recommend programs relating to reducing and/or preventing company liability Review procurement and contracting documents and activities and identifies appropriate indemnification tenders and insurance requirements to mitigate areas of liability

Manager – Dealing His key responsibilities include: ➢ ➢ ➢



Analyze the quality of research Monitor the functioning of the dealing department Ensure that the staff in the dealing department are well aware and conscious of the market conditions and changes

Dealer Dealer is the face of the broking house to the market. Hence it is very important that he is well educated and aware about the market. Every dealer has to be registered with the SEBI. The primary responsibilities of a dealer include: 61

➢ ➢ ➢ ➢



Execute the trades for his/her firms accounts i.e. those clients who have an account with the particular broking firm Interact with the clients in real time since online broking services are now available Send e- mails, fax to the clients for day to day communication Acquire an understanding of products and services required by the client

Manager-Customer Service The Customer service manager has two teams-a client service team and a business associate service team. Business associates include the brokers and sub-brokers and are like partners to the business. The duties of the customer service manager include: ➢ ➢ ➢ ➢ ➢ ➢ ➢



Client Service Team ➢ ➢ ➢ ➢



Responsible for handling two teams, one for addressing the client’s complaints and the other team for addressing complaints of business associates Ensure that the complaints from both of these teams are answered as soon as possible Scrutinize the complaints to check their validity Organize a system to report the complaints Organize a procedure to resolve the complaints Maintain an periodicity for complaints registered Maintain an online 24 hour customer help system

Answers all the complaints of the client and solves them Maintenance of a complaint register Create a designated email id for grievances of the investors/clients Keep a check on the periodicity for handling the clients grievances

Business Associate Service Team ➢ ➢ ➢ ➢

Solve the complaints of the business associates efficiently as they are partners to the business Maintenance of a complaint register Check whether the complaints are received from the branch/sub broker Create a designated email id for grievances of the branch/sub brokers 62

➢



Keep a check on the periodicity for handling the sub brokers grievances

Manager – Settlement The manager – settlement scrutinizes the funds and settlement teams. ➢ ➢ ➢ ➢ ➢ ➢



Oversee self-administration of all liability claims and recommends and authorizes settlement amounts on all claims and litigation against the company. Ensure timely settlement of trade for the client Meeting out the delivery obligations & settlement of all trades Smooth flow of all pay-in and pay-out for clients Passing information to the finance department Taking the trade files from the exchanger and inputting into the system

Funds and security settlement team This department works in tandem with the finance department because it has to keep a check on the funds pay-in and pay-out of the clients. ➢ ➢ ➢ ➢ ➢

Check whether pay-in and pay-out is received from or delivered to the respective clients Check whether clients funds/ securities are transferred to respective clients within one working day of pay-out from exchange Registration of the securities to be provided To check whether pay-in and pay-out was received from or made to account other than the respective clients and also ensure the compliance in this regard To check whether bank book and register of securities are in alignment with bank statements and transaction statements provided by banks

63

ADMINISTRATION SECTION

Administration department provides clerical and administrative support to an organization, either as a team or individually. This department is responsible for co-coordinating and implementing office procedures and specific projects, providing training to junior staff for proper implementation of administration policy. It is also involved in dealing with telephone and email enquiries, creating and maintaining filing systems, keeping diaries and taking appointments for staff. It looks after the dispatch of important documents from the firm and segregates and sends incoming documents to the relevant department. Most work of this department is clerical in nature and requires communication and word processing skills. 64

65

Organization chart for Administration section

Manager Administration

In charge – Housekeeping

In Charge Maintenance

In charge -Security

Housekeeping Team

Maintenance Team

Security Staff

In charge- Logistics

Process flow of Administration section

Work performed by the administration section may not be regarded very highly, but is equally important for the proper functioning of the organization. However, this work is usually outsourced to an outside agency.

66

Housekeeping process

67

Housekeeping process

Reporting 1hr before office opens

Cleaning the Desks and Floors

Clean the dustbins

Clean and Refill water bottles

In case of meetings

Ensure that conference rooms are clean and maintained properly

Serve Refreshments

Reporting inventories requirement to Housekeeping Incharge

Maintaining cleanliness in washroom

END

68

Maintenance process

69

Maintenance process

Check all office Infrastructure is maintained properly

Complaint received from Department/employees

Check /verify what is the problem

No

Properly maintained

Replace/Repair any Infrastructural problem

Check whether it is working properly

Yes

END process

Report to ManagerAdmin

70

Security process

71

Security process

Open office 1hr before office time

Check entire premises for security breach

Ensure proper security in premises

Scan & Register movement of people in &out

Monitor the movement of vehicle

Respond to Emergencies Effectively

Check all entry and exit after all employees leave at the end of the day

Close the office premises

END

72

Logistics process

73

Request

Logistic Storage Process Flow Chart

Internal Departments

On the Basis of; 1. Department 2. Bulk 3. Frequency 4. Importance

Collection Center

Logistic Team

Receives Documents from Departments

Segregation of Documents

Scanning of Documents

Initial Location Marking

Dispatch to Storage Location

Storage Center

Excel Data Base

Excel Data Base

END

Final Location Marking & Entry in Database

Receipt Confirmation

74

R eq u es t

Logistic Retrival Process Flow Chart

Document Demand’s by External Auth Internal Departments

C ollect io n C en te r

Logistic Team

Receives request from Department’s for retrieving documents

Queries the Database to find the Loaction

Forwards the Request to Storage Center

Excel Data Base

S to ra ge C e n te r

Excel Data Base

END

Confirms the Receipt and Maintains Track

Send’s to the Collection Center or Required Location

Search the Required Document

75

KRA Guidelines for Administration section



Manager-Administration ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Responsibility for the overall work performance of a company Management of office environment Gathering, adapting, storing and distributing information within the company Providing specialized support to other departments and managers Providing document and telecommunication management Planning, organizing, providing leadership and controlling all administrative functions Managing quality and cost control Rendering a service to other functions within the organization Providing training and development for your own staff Ensuring that human and material resources are correctly utilized Oversee facilities planning and maintenance and support operations

In-charge – Housekeeping The main responsibilities of the housekeeping in-charge include: ➢ ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

To ensure that agreed standards of cleanliness and hygiene are maintained in organization with correct procedures and administration Organize day-to-day work requirements and set required standards against which work will be checked, in accordance with correct procedures and administration on an as and when required basis To ensure that all equipment, furniture and furnishings are maintained, checked and kept in good working order in accordance with correct procedures and report all relevant faults Assign workers their duties and inspect work for conformance to prescribed standards of cleanliness Investigate complaints regarding housekeeping service and equipment, and takes corrective action Coordinate work activities among departments Conduct orientation training and in-service training to explain policies, work procedures, and to demonstrate use and maintenance of equipment Evaluate records to forecast department personnel requirements Make recommendations to improve service and ensure more efficient operation Purchase, re-order and maintain housekeeping supplies and inventory 76

➢



Housekeeping staff ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Maintain the housekeeping budget, providing billing summaries and expenses for all pre and post events

Clean rooms, hallways, lobbies, lounges, restrooms, corridors, elevators, stairways, locker rooms and other work areas so that health standards are met Clean rugs, carpets, upholstered furniture Empty wastebaskets, empty and clean ashtrays, and transport other trash and waste to disposal areas Sweep, scrub, wax, and/or polish floors, using brooms, mops, and/or powered scrubbing Dust and polish furniture and equipment Keep storage areas and carts well-stocked, clean, and tidy Replace tube-lights and bulbs Replenish supplies such as drinking glasses, linens, writing supplies, and bathroom items Wash windows, walls, ceilings, and woodwork Move and arrange furniture, and turn mattresses

Incharge – Maintenance ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Ensure all assets and equipment are in place and working effectively to ensure asset reliability Manage and direct staff by providing ongoing training, recruiting, and counseling Provide overall project management for all initiatives using either internal or external resources Ensure inventory of spare parts is adequate to support good equipment reliability, and also maintain cost Ensure smooth co-ordination with other department Analyze trends and identify continuous improvement opportunities Establish organization-wide standards and best practices including developing policies, procedures, and work flows Supervise and assigns the work of maintenance employees Determine material, equipment, and supplies to be required Supervise and maintain routine records

77



Maintenance Staff ➢ ➢



In-charge – Security ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Look after the maintenance of the office infrastructure like office furniture, plumbing, electric points, telephone connection etc Manage the entire arrangement in case of any conference, meeting or event like checking whether the projector is functioning properly, the seating arrangement is proper etc

To lead and manage the security department and staff ensuring the safety and security in of the firm Manage the day-to-day operations of the security department and direct the activities of the security staff Operate the security department within budgetary guidelines and in response to actual business conditions Develop and implement policies and controls on issues relating to security operations to include patrol schedules and procedures, emergency procedures, key control, package inspections, security reporting, handling of disturbances and suspicious activity, etc. Ensure that all security employees consistently adhere to uniform, grooming and appearance standards Develop and conduct effective training programs geared to educate staff on specific job skills and to the enhance expertise of personnel Establish goals for the security department and implement procedures to achieve such goals Maintain effective communication within security department and other departments Ensure that staff is kept aware of issues relating to security in the organization Ensure that relevant reports are completed in a clear, professional manner Maintain accurate documents on all security reports & review all security reports daily Maintain adequate supply of all materials used in department Ensure security staff performs their respective duties effectively & monitors and verify the attendance record of the staff

Security Staff

78

The security staff is basically responsible for the overall security of the premises of the firm. In India, this service is usually outsourced, not just in broking firms but in any industry. The basic duties and responsibilities of the security staff include: ➢ ➢ ➢ ➢

➢



Opening and locking/closing of the office premises at the start and end of day respectively Keep a check and maintain records of all the people entering and leaving the office premises Prevent unapproved or unlawful entry and control the movement of people at entrances Monitor the movement of vehicles and their parking, operate the gate and examine vehicle contents, monitor remote entrances Respond to emergencies such as medical and bomb threats and to alarms such as fire and follow emergency response proceedings

In-charge-Logistics ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢

Monitoring the quality, quantity, cost and efficiency of the movement and storage of relevant documents Coordinating with other departments for smooth flow of activities and information Analyzing data to monitor performance and plan improvements and demand Allocating and managing staff resources according to changing needs Proper storage of departmental documents Optimum utilization of infrastructure effectively Implementing health and safety procedures Managing staff training issues Motivating other members of the team

79

RESEARCH DEPARTMENT

The research department deals with primary and secondary research activities for the firm. The research undertaken by a broking house forms an important constituent of the service provided by 80

it. Hence it is very important for a broking house to have a good research team. The importance of this department cannot thus be underestimated.

Organization chart for Research department

CRO / VP - Research

Manager

Manager

Assistant Manager

Assistant Manager

Trainee

Trainee

Equity Research Team

Commodity Research Team

Derivatives Research Team

Mutual Fund Research Team

Currency Research Team

Process flow of Research department Typically, a research department has many sub-teams in it who research on various areas like equity, mutual funds, derivatives etc. Since the core area of functioning is research, the process 81

followed by all the sub-teams is similar. The process followed by a research department is shown in the chart below.

82

Research process flow

Research based on fundamental and technical analysi s

Daily researching via internet, journals, etc.

Develop the various tools

Generate reports for the portfolio team

Support the research on all investments

END process

83

KRA Guidelines for Research department



VP-Research ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Ensure that the research team conducts in-depth analysis of the industry and publicly-traded companies in the main sectors Responsible for the overall administration for developing, coordinating, and stimulating research Ensure compliance with all applicable laws and regulations Develop deep understanding of the sector trends and individual company performance within the sector by leveraging primary research, publications, website, conferences and seminars and personal contacts Prepare an accessible database for data pertaining to the relevant universe of companies Develop conviction on ‘buy’, ‘sell’ or ‘hold’ positions, and articulate investment opinions to fund managers and dealing department Understand the specific business needs of the front office in respect of the market and direct research activities to support the requirements Provide management information to the management on a periodic and ad hoc basis. Liaise with other staff within the on all market related issues Manage the relationship with the external providers of research and analysis Motivate the research team to ensure that the research is of the best quality Make plans and schedule the activities of the department Provide regular feedback to the research team so that it helps them improve the quality of their research

Manager-Equity ➢ ➢ ➢ ➢ ➢

Primarily responsible for company and industrial research Create concise reports upon which the portfolio management team will look into for reference and support and to provide advice to clients Daily researching industry data via the internet, journals and periodicals Supporting research on all investments across all industrial sectors Responsible for developing and maintaining data capture tools and stores

84



Manager – Commodity ➢ ➢ ➢



Manager – Mutual Funds ➢ ➢ ➢



Analyze the mutual fund market, the needs of the customers and prepare reports based on this analysis Keep himself abreast of the latest schemes launched by mutual funds Study the existing schemes available so as to give advice to clients

Manager – Currency ➢ ➢ ➢



Research on the commodity market and come up with new strategies which can benefit the clients in this market Prepare timely reports on his findings and research and then submit it to the brokers who advice the clients Constantly work to acquire in depth knowledge about the commodities market and its functioning

Study and acquire in depth knowledge about the currency market and its functioning Research on this market and come up with new strategies which can benefit the clients in this market Prepare timely reports on his findings and research and then submit it to the brokers who advice the clients

Manager-Portfolio Management Services/Wealth Management ➢ ➢ ➢ ➢ ➢ ➢ ➢

Daily management of client risk contact Financial reporting and managing client funding and related reporting Liaise with an underwriting team to review credit limits Maximize collections through holds and minimize the risk of loss Working closely with debt recovery team Mitigate the risk of loss by taking relevant actions like reduce or cancel credit limits, block customers, set up payment plan, take legal actions Attend cash calls with client and communicate portfolio performance 85



Research Associate ➢ ➢ ➢ ➢ ➢ ➢



Duties include financial data gathering, fact checking, firm and industry analysis, etc Data Entry and Analysis, MIS Reports, Inter & Intra Department coordination, making presentations Reports preparation by analyzing entity & assignment of credit rating Compiling of data Checking accuracy of report Perform complex analysis & work on financial / industry research based reports

Research Trainee ➢ ➢ ➢ ➢ ➢ ➢ ➢

Carrying out department daily functions & processes Collection and analysis of data Demonstrating skill with basic software used to analyze data Write summaries, abstracts, documentations of files, and verify whether other written materials are clear, logical and concise Write simple programs; conducts relatively simple statistical and other analysis after receiving basic instructions Plans, organizes and accomplishes assignments to meet established deadlines Demonstrate a clear understanding of the assignments and the purpose of the research and can effectively convey ideas

86

COMPLIANCE DEPARTMENT

The compliance department is responsible for establishing, implementing, administrating and overseeing company’s compliance program. It monitors day-to-day compliance issues and implements compliance policies and procedures in the firm. It thus attempts to promote an awareness and understanding of positive ethical principals consistent with organizational policies and goals as well as those required by law. This department works in close coordination with the legal counsel and seeks it advice with appropriate. It provides quarterly reports to the board regarding the operation and status of company’s compliance program.

87

88

Organization chart for Compliance department

CCO / VP - Compliance Principal Officer Manager - Audit

Audit Officer

Manager - Legal

Manager – Corporate Compliance

Compliance Team

Manager – Operations Compliance

Manager – Business Development

Process flow of Compliance department

This department is one of the most important departments in a broking house. The department looks after the compliance procedures as per rules laid down by the regulatory authorities from time to time. It also has to look after the audit and the legal law of the land. However, the audit and the legal functions are usually out-sourced. The compliance team follows a certain procedure which is given below.

89

90

Introduction of a new policy by regulatory authority

Change in existing policy by regulatory authority

Study the new policy

Build new compliance policy and procedure

Delegate new policies and norms to concerned departments

Arrange training for staff

No

Yes

Queries solved

Solve queries of employees regarding new policies

Implement new policy

Send copy of new policy to internal auditor

Monitor compliance by conducting periodic audit

Report to CCO

Yes

Implementation complying with new policy

No

END process

Identify deviations and recitify

91

KRA Guidelines for Compliance department 

Chief Compliance Officer ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Implementing written policies, procedures, and standards of conduct Establishing a compliance committee Developing effective lines of communication Enforcing standards through well-publicized disciplinary guidelines and developing policies addressing dealings with sanctioned individuals Conducting periodic risk assessments and response plans Conducting internal monitoring and auditing and Responding promptly to detected offenses, developing corrective action, and reporting findings to the government via established channels Ensuring that the activities of regulated companies are monitored to ensure that they are complying with their legal and regulatory obligations Making determinations in relation to issues or allegations of non-compliance by company as part of the compliance management process Ensuring, as part of the issues management process, that regulated companies understand their legal and regulatory obligations. This supports one of the key goals of the compliance office, which is to create a culture of compliance in the company

Principal Officer The objective of appointing a Principal Officer (PO) is to create a vigilance person whose responsibility will be to find suspicious financial transactions in ordinance to PMLA and to prevent the organization from facilitating money laundering unknowingly. The duties of the principal officer include: ➢

Monitoring transactions • Daily – At the end of the day, the PO will generate a report of all the transactions done in the clients’ account whose value is more than 10 lacs. Once the report is generated, it is analyzed to find any suspicious transactions like if the client is trading beyond the declared income of his financial status which does not justify the trade value. • Weekly – Possibly on Saturday or before Monday noon, the PO generates a report mentioning the names of all the clients who have done a cumulative transaction over 10 lac or who have deposited funds of more than 10 lacs within a week. 92

•

➢

➢

➢ ➢

➢ ➢ ➢

Monthly – Before the 5th working day of every month, a report is generated by the PO mentioning the names of all the clients who have done a cumulative transaction of over 10 lacs or who have deposited funds of more than 10 lacs within a week and the cumulative family-wise data. This report is then analyzed for abnormalities. • Quarterly - Before the 10th working day of April, July, October and January, a report is generated by the PO mentioning the names of all the clients who have done a cumulative transaction of over 10 lacs or who have deposited funds of more than 10 lacs within a week and the cumulative family-wise data. This report is then analyzed for abnormalities. • Any suspicion found is immediately reported as per the PMLA to the immediate supervisor. Demat Transaction Monitoring • A report is generated every fortnight by the demat department and forwarded to the PO. The report contains all the transactions done differentiated on the basis of account transfers (OFF market and FOR market), inter depository, demat, remat, repurchase and pledge. • The PO needs to take the average 15 days price of the security and generate the value of the transaction. The report is then sorted individual client-wise, family-wise and group company-wise. • The transactions are monitored according to the value of the transaction over and above the declared income or financial status of the client and any repeated circular transactions. • Any suspicion found is immediately reported as per the PMLA to the immediate supervisor. Organizing training programs on Anti-Money Laundering Act for the staff who are involved in daily activities, financial transactions and KYC like dealing team, settlement team, demat and account opening teams, etc Verifying and scurrility of the documents of the clients, families or groups and especially large corporate (listed and non-listed), NRI’s during client account opening process Personally interviewing clients who have declared wealth above 10 lac or intend to trade (intraday) above 1 Cr in a month or who have given initial margin of Rs. 5 lac and above in the form of monies or securities Personally interviewing clients who are NRIs or corporate/trust who promote NRIs. The interview may be done through telephone but it is preferred to meet the client in person. Try to find out the risk appetite of the client – high, medium or low in the interview process so that it helps in finding out any suspicious trading or transactions in the future Personally interview and scrutinize the documents of the clients including income documents of the employee involved in maintaining and updating critical information about the transactions of the client and also of the employees who facilitate transactions of the clients like dealers, settlement officer, etc 93



Manager-Legal ➢

➢ ➢ ➢

➢

➢ ➢ ➢

➢ ➢ ➢ ➢

➢ ➢ ➢



Vetting of Property documents and liaise with Law firms in getting title certificates, drafting/vetting of Leave & License/Lease Agreement, Amenities Agreement for branch and sales office Handle investor grievances/complaints filed by clients with Investor grievances committee of Stock Exchanges NSE, BSE, MCX, SEBI and other regulators Draft suitable response /reply to the Investors grievances/complaints after coordinating with respective branches, customer relationship team and other departments To attend the hearing at Investors Grievances Committee/Arbitration hearing to argue/defend the matter Drafting of documents, Statement of case, reply, rejoinder, sur-rejoinder and other application for arbitration proceedings filed by or against the company and investigating the matters Conduct execution for enforcing awards in arbitration referenes Draft replies to Adv. Notices from clients and regulatory and other authorities Issue statutory notices under Negotiable Instruments Act and debt recovery notices to clients Handling litigation such as consumer cases, cheque bouncing cases, civil and criminal cases etc., regular follow up on service of summons & warrants to the accused Drafting and vetting of Financing/Loan Documents and security documents Drafting and vetting of borrowing documents such as Working Capital Agreement, Loan Documents, Trust Deed, CP Agreement and to create securities in favour of the Lender Review of all existing documents on a periodic basis and modify the same at regular intervals to strengthen the documents and also to comply with the amendment as may be proposed by the regulators / internal policies of the company from time to time Draft, negotiate and finalize Service Level Agreement, Vendor Agreement, Non Disclosure Agreement, Confidentiality Agreement, etc Assist business in developing deal structures for new transactions Advise various departments across the company on legal issues raised by them

Manager-Audit ➢ ➢

➢ ➢ ➢

Examine and evaluate the effectiveness of financial controls Make key decisions on a regular basis within department and influence across organization Manage the development of systems to measure and engage policies and procedures following the process upon implementation with continual influence Conduct departmental evaluations for operational performance Conduct compliance audits 94

➢ ➢ ➢

➢ ➢ ➢



Oversee the evaluation and presentation of internal audit results for presentation to other key positions Constant interface with senior management Perform financial and operational audits of organizational and functional activities, in order to verify accuracy of financial information, ensure proper accountability and evaluate compliance with plans, policies and procedures Plan and executive internal audits, utilizing risk assessment methodologies to assess financial, accounting, and operational risks Identify, assess, evaluate, and document internal controls over processed audits Recommend additional controls to strengthen internal and operational controls

Audit Officer The job profile of an audit officer includes the following: ➢ ➢

➢ ➢ ➢ ➢



Internal audit and risk assessment based on verification of records and end to end processes Implementation of audit plan given by Sr. audit manager Assessing, analyzing and verifying data collected Physical verification of data, if required Preparation of the audit report with observations and recommendations, and submitting to audit manager Preparation of presentations for audit committees

Manager-Corporate compliance ➢ ➢ ➢ ➢ ➢ ➢ ➢

Implementing a central repository/application to track all compliance requirements Monitoring all enterprise-wide compliance activities and staying abreast of compliance issues Establishing an annual compliance review/audit plan Performing and coordinating independent reviews/audits Identify compliance weaknesses and assist departmental areas with enhancing related controls and processes Establishing formal reporting process for keeping the risk management committee, senior officers, and the audit committee informed regarding compliance matters Managing processes designed to ensure that all board policies and key management-level policies are reviewed and updated annually 95

➢



Manager-Operations Compliance ➢ ➢ ➢

➢ ➢



Periodically reviewing and updating the company’s code of conduct to ensure continuing currency and relevance in providing guidance to management and associates

Plans, organizes, and conducts complex operational, financial, compliance and IT related audits of business operations Develops test plans to evaluate internal control design Assists Coordinating Auditors and audit manager in performing and/or leading audits of business operations, IT environments including reviews of general IT controls and application controls Assists the audit director with risk assessment, annual audit plan development, and department process improvement initiatives Assists with quality assurance/peer review of audit work papers to ensure compliance with professional standards, drafts audit reports, management action plans and conducts exit interviews with auditees and senior management

Manager-Business development ➢ ➢ ➢ ➢

Oversee compliance as regulatory guidelines and company’s policies Oversee compliance as per privacy regulation Develop policies & procedure to support privacy compliance Design privacy training programs

96

TECHNOLOGY DEPARTMENT

With quick changes in technology today, the technology department has started gaining more importance recently. Also, since many services given by a broking firm are now based on the use of technology and the internet, the need for a full-fledged department has been felt now. This department mainly provides the much needed technology support to the services offered by a broking firm. 97

98

Organization chart for Technology department

CTO/ VP Technology

Manager – Software Development

Manager – Data Security & Backup

Manager – IT Operations

Manager – IT Support

Development Team

Process flow of Technology department

The technology department looks after the technology needs of the broking house, right from developing software and maintaining backup of data to providing IT support to the clients as well as employees of the organization. Hence, the processes followed by this department are varied. The following charts depict the process flows followed by each sub-team within the technology department.

99

Software development

100

Identify software requirement

Preliminary documentation

Project study

Prepare project proposal

No Project specification and design

Software development

Yes

Test the software

Approval by CTO

Test successful

No

Maintenance and support

Yes

Feedback from users

Install software

END process

101

Data security

102

Study the information flow in the organization

Check whether firewalls are functioning properly

Check whether antivirus program is proper

Check for any security breach

Assess processes in terms of potential risk and threats

Yes

Is there any security threat to data?

Determine security requirements

Yes

Make changes to the data security policy

Report to CTO

Implement the policy

END process

No

Data Backup 103

104

Backup process flow

Identify data for which backup is to be taken

Classify data which is critical and important

Take backup of critical data as per Backup policy

Send copy of backup to disaster recovery centre

Store the media at the designated place

Label the media according to type of data stored and server name

Update database with details of backup taken

Randomly restore and test backup

Record test results to avoid tampering

Report to CTO

No

Backup is up -to-date

Find out reasons for deviations and take corrective action

Yes

END process

105

IT Operations/Support

106

Check whether all the network components are working properly • Lease lines • Server • LAN network • Internet service etc.

Check whether all the employees are working as per the IT policy

IT policy violations

Yes

No

All components are functioning properly

No

Yes

END process

Query received from an employee

IT Operations/Support team

Identify the network component and the error

Take corrective action

END process

Report to CTO

KRA Guidelines for Technology department 107



Chief Technology Officer/VP-Technology The Chief Technology Officer will provide the strategic vision for enhancing our publishing products and our infrastructure. He will be a member of the senior management team and will work with the team to set company priorities and implement processes that will help improve our product development. ➢ ➢ ➢ ➢ ➢

➢

➢

➢ ➢ ➢ ➢

Responsible for overseeing our current technology team and our current platform Build relationships with vendors, contractors and external companies for all our technology related initiatives Responsible for ensuring that the company’s information technology investments are aligned with its strategic business objectives Designing and recommending the appropriate technology solutions to support the policies and directives issued and to satisfy the information needs of the firm Provide the company with an executive-level subject matter expert on the issues surrounding the technologies that the firm must employ in order to achieve the company’s strategic objectives Develop the technology solutions needed to meet the goals of a modern business. Responsible for the oversight management of such office automation tasks as desktop architecture and support, network implementation, software development, and information management Evaluate the newest and most innovative technologies and determine how these can help their organization Manage and plan technical standards and tends to the daily information technology issues of the firm Constantly lookout for developments that could benefit their organization, especially with the rapid pace of technological change Demonstrate to a company how information technology can be used as a competitive tool that not only cuts costs, but also increases revenue and maintains or increases competitive advantage

108



Manager – Software development The Software development manager must help with the development of the organization and be a key driver for building a great strategy for developing software efficiently and driving strategy for continued development projects. His responsibilities include the following: ➢ ➢ ➢

➢ ➢

➢ ➢

➢



Perform a analysis of the requirements of the broking house Make a feasibility and cost-benefit analysis, including the choice of application architecture and framework, leading to the budget and schedule for the project Update development standards research, new development, modification, reuse, reengineering, maintenance, or any other activities that result in software products Responsible for web site development Manage existing team of developers Providing network connections to servers, sub brokers & exchange Optimizing/enhancing network performance Continue building the R&D team to attract, train, grow, mentor, and retain talents at all levels.

Software development team The development team would execute the instructions given by the software development manager and help him to achieve the objectives of their team. Their primary duties include: ➢ ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢

Designing and implementing product features and developing tests. Designing the software applications and the user interfaces as per instructions received Prepare specification of new software designed Design and implement the designed software (e.g. installation, configuration, programming/customization, integration, data migration) Maintenance of software in use Authoring of documentation needed by users and implementation partners etc. Testing, including defining/supporting acceptance testing and gathering feedback from prerelease testers Participation in software release and post-release activities, including support for product users such as developing demonstrations Analyze the functioning of the current software for subsequent product build/release cycles

109



Manager – Data backup and security ➢ ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢ ➢



Manager – IT Operations ➢ ➢ ➢ ➢ ➢



Ensure that the system security is always maintained to the maximum Manage user access administration Leading the team of data & security consultant Responsible for installation & configuration of security hardware like switches and routers and software programs like firewalls, anti-virus, anti-spam programs Ensure co-ordination & integration with customers on network/security related issues Maintain and test back up for the data stored in the server from time to time as per the policies of the company Responsible for keeping the computer network secure Analyze networks for potential problems and troubleshooting to identify possible security threats ahead of time Develop new Internet protocol procedures to deal with viruses Protect the company's information and projects by developing and implementing data encryption methods and programs

Monitoring, troubleshooting problems of leased lines Co ordination with service providers of internet services Troubleshooting of NSDL, CDSL Server and client Terminals. Handling BSE (Bombay Stock Exchange) and NSE (National Stock Exchange) through ISDN Handling day to day problems

Manager-IT Support ➢ ➢ ➢ ➢ ➢

Solve online client's queries, by co-coordinating with the concerned dept Solve the problems on different client's locations Maintenance of modems, scanners, printers, Internet mail setups for employees Attending day-to-day calls related with networks and computer software Co-coordinating the entire customer support work and ensuring effective functioning of the system 110

HUMAN RESOURCES DEPARTMENT

The existence of a human resources department is vital to overall productivity and efficiency of the strong workforce in any thriving company. In most professional organizations, the role of the human resources department is not sidelined or eclipsed by other departments. In fact, good human resources can be one of the most valued and respected departments in an organization; their job is people, and people are the company’s most important asset. Human resource management is concerned with the people dimension in management. Every organization is made up of people and thus acquiring their services, developing their skills, motivating them to high levels of performance, and ensuring that they continue to maintain their commitment to the organization are essential to achieving organizational objectives. This function gains even greater importance due to the nature of the industry – service. 111

Organization chart for Human Resources department

VP- Human Resource

Manager – Recruitment & Training

Manager – HR Operations

Manager – Staff Benefits & PR

HR Executive

HR Executive

HR Executive

Process flow of Human Resources department The human resources department comprises of a number of sub-teams that handle various tasks related to the welfare and maintenance of employee relations. The sub-teams in this department include recruitment and training, HR Operations and Staff benefits and PR. The processes followed by each of these teams are shown in the diagrams that follow.

112

Recrutiment

113

Receive recrutiment request Prepare advertisement and advertise in various media

HR recruitment team

Prepare Job description and specifcation

Scan resumes Conduct a resume search – internal or external

Send list of shortlisted candidates to the concerned dept.

Organize interview with concerned department head

Call shortlisted candidates for interview

Conduct interview process

Decision making

No

Yes

Decision making

Check references and documentation

Decision making

Yes

Convey decsion to unsuccessful candidates

END process

Shortlist resumes

Call successful candidates for HR round of interview

Conduct HR interview

Make offer

Confirm appointment and DOJ

Yes

Accepted

No

114

Public Relations

115

Query / problem raised by an employee

Introduction of new rules for staff

Organize outings for staff

Understand and identify the problem

Finalize details like venue, date, transport etc

Formulate a solution to the problem

Arrange resources for the outing

No Take approval from VP-HR, if necessary

Determine message to be communicated

Yes

No

Draft approved

Send draft to VP-HR for approval, if necessary

Draft the message to be communicated

Communicate the message to concerned employees

Collect feedback

END process

Yes

KRA Guidelines for Human Resources department 116



VP-Human Resources ➢

➢ ➢ ➢ ➢ ➢

➢ ➢ ➢ ➢ ➢ ➢ ➢ ➢



Manager - Recruitment and Training ➢ ➢ ➢ ➢ ➢ ➢

➢



Provide leadership and coordination of company Human Resource functions Develop and implement corporate Human Resource strategy and programs. Create company strategic recruitment and selection plan Coordinate company equal opportunity programs to achieve diversity goals Create company strategic training and organizational development plan to meet personal, professional, and organizational needs of company employees Oversee compensation programs to ensure regulatory compliance and competitive salary levels Oversee the design and development of compensation strategy and programs. Direct the administration of benefit programs to include health, retirement, death, disability, and unemployment. Evaluate and recommend improvements to benefit programs Recommend and maintain an organizational structure and staffing levels to accomplish company goals and objectives Evaluate company culture and provide recommendations on changes to accomplish company goals and objectives Evaluate and recommend human resource outsourcing opportunities and identify potential vendors Recommend and establish company policies and procedures Serve on planning and policy-making committees

Prepare the Job Description Identify the Competencies required Identify the source for hiring Interview the candidate Coordinate the interview with the respective department Ensure that the documentation process is completed when the candidate is hired Evaluate the training requirements of the hired candidates and arrange their training

HR Executive – Recruitment 117

➢

➢ ➢ ➢ ➢



Manager – Staff benefits and PR ➢ ➢ ➢ ➢

➢

➢

➢ ➢ ➢ ➢



Assisting the recruitment manager in the recruitment process Searching the resumes of the probable candidates according to the identified sources of hiring Short listing the CVs as per required openings Scheduling the interviews Collecting the relevant documents on the selection

Investigate, review and resolve complaints/disputes/issues quickly and efficiently, in an impartial manner and to the mutual agreement of all parties Continually review Board policies and procedures to ensure that they reflect the needs of employee community Prepare information for management to use during collective bargaining agreement negotiations Responsible for planning, developing and implementing PR strategies Interpret and administer the contract with respect to grievances, wages and salaries, employee welfare, health care, pensions, union and management practices, and other contractual stipulations Advising line managers on staff relations policy and negotiation with unions Writing and editing in-house magazines, case studies, speeches, articles and annual reports Managing the PR aspect of a potential crisis situation Monitor the performance of line and other staff departments to ensure that they conform to established staff relations policy, procedures and practices Review Board decisions and provides comments as requested

HR Executive – PR ➢

➢ ➢ ➢

Assisting the Public Relations Officer in handling staff disputes and grievances Arranging staff picnics & other social events in the organization Looking after the layoff procedure Provide regular updated data and information to the manager to assist in decision-making

118



Manager -HR Operations ➢ ➢

➢



Ensure that proper records of leaves and holidays taken by employees are maintained Ensure that payroll records are properly maintained so remove any possibility of errors in making salary calculations periodically Oversee documentation processes like issue of offer letter, entry forms, opening salary accounts etc

HR Executive – Operations ➢

➢ ➢ ➢

➢

Maintain day to day HR records Look after salary processing Print the offer letter and maintain all relevant documents Open up salary bank account of new employees Maintain proper leave records

119

CONCLUSION The equity market in India is expanding at a rapid pace, leading to expansion of the broking industry. Creation of new markets and products has become the norm of the day. The size of the firm has assumed importance, reach and access have emerged as importance metrics for growth and there have been major changes in the delivery and distribution channels and processes.

The objective of the report “Micro study of an Indian stock broking firm” was to understand the working of this industry with respect to the organizational structure of an Indian broking firm. The aim was to bring out a model that explains how a firm in this industry operates and functions. The processes followed by each department in a broking firm have helped us to understand the working of this industry, the impact of the regulators like SEBI, RBI, the government etc on its functioning, and the importance of this industry to the Indian economy.

The project covered various aspects of a broking house at a micro level like the following: •

General Hierarchy of a brokerage firm

•

KRAs of the people working in the organization

•

Process flow of the key departments of the brokerage firm

This project has provided a learning of the organizational structure right from the topmost level of hierarchy i.e. board of directors to the lowest level of hierarchy i.e. junior officer. Along with this, it has given us an insight on the functioning of the all the departments. This helps us to analyze the flow of work in a brokerage firm. It also highlights the Key Result Areas of different corporate profiles in a brokerage firm. Thus, it has been a thorough learning experience.

120