The Central Government established the IEPF to safeguard investors’ interests and raise awareness. It was created in accordance with Section 125 of the Companies Act of 2013 (the “Act”). Investors’ unpaid or unclaimed funds are collected and contributed to the IEPF as a whole. According to the Act, the IEPF monies are used for a range of objectives.
The IEPF Authority is in charge of overseeing the IEPF money after consultation with the Comptroller and Auditor-General of India. Additionally, it maintains separate accounts and other necessary documentation related to the cash as needed. The IEPF’s funds are the total amount that has been accrued or credited to it in compliance with the Act’s rules.
Goals outlined in the Act may be expanded upon by the IEPF Authority. The financial records of the IEPF will be examined by the Comptroller and Auditor-General of India. The IEPF Authority yearly transmits the audited accounts and audit report to the Central Government.
Transparency: By centralizing unclaimed funds and promoting a straightforward approach for their use, the IEPF promotes transparency and accountability in the financial system.
Investor Education: The fund is crucial for boosting investor awareness and education, assisting investors in choosing wise investments, and assisting consumers in navigating the complexity of the financial system.
Social Responsibility: By gathering unclaimed funds that are then used for different investor welfare programmes, the IEPF encourages businesses to uphold their corporate social responsibility.
Market Confidence: By ensuring that unclaimed funds are used for investors’ benefits, the IEPF contributes to increasing trust and confidence in the financial markets. As a result, domestic and international investors are increasingly interested.
Additionally, the IEPF Authority shall compile its annual report for each fiscal year, providing a thorough description of its operations throughout the year, and provide a copy to the Central Government. Before each House of Parliament, the Central Government will present the annual report from the IEPF Authority and the audit report from the Comptroller and Auditor-General of India.
