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10.8 Cut-Off Time and Time Stamping

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NISM-Series-V-A: Mutual Fund Distributors Certification Examination Exam

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1 Chapter 1: Introduction & Exam Overview

1.1 About the NISM-Series-V-A Examination 1.2 The 12-Unit Curriculum Map and a Study Plan

2 Chapter 2: Investment Landscape

2.1 Investors and Their Financial Goals 2.2 Savings or Investments? 2.3 Different Asset Classes 2.4 Investment Risks 2.5 Risk Measures and Management Strategies 2.6 Behavioural Biases in Investment Decision Making 2.7 Risk Profiling 2.8 Asset Allocation and Do-It-Yourself versus Professional Help

3 Chapter 3: Concept and Role of a Mutual Fund

3.1 Concept of a Mutual Fund 3.2 Classification of Mutual Funds 3.3 Growth of the Mutual Fund Industry in India

4 Chapter 4: Legal Structure of Mutual Funds in India

4.1 Structure of Mutual Funds in India 4.2 Key Constituents of a Mutual Fund 4.3 AMC Organisation Structure and Service Providers 4.4 Role and Function of AMFI

5 Chapter 5: Legal and Regulatory Framework

5.1 Role of Regulators in India 5.2 Role of SEBI and the Mutual Fund Regulations 5.3 Due Diligence Process by AMCs for Distributors 5.4 Investor Grievance Redress Mechanism 5.5 AMFI Code of Conduct for Intermediaries

6 Chapter 6: Scheme Related Information

6.1 Mandatory Documents I: Scheme Information Document and Statement of Additional Information 6.2 Mandatory Documents II: Key Information Memorandum and the Advertisement Code 6.3 Non-Mandatory Disclosures

7 Chapter 7: Fund Distribution and Channel Management Practices

7.1 The Role and Importance of Mutual Fund Distributors 7.2 Different Kinds of Mutual Fund Distributors 7.3 Modes of Distribution 7.4 Pre-requisites to Become a Distributor of a Mutual Fund 7.5 Revenue for a Mutual Fund Distributor 7.6 Commission Disclosure Mandated by SEBI 7.7 Distributors versus Investment Advisers, Nomination Facilities and Change of Distributor

8 Chapter 8: Net Asset Value, Total Expense Ratio and Pricing of Units

8.1 Fair Valuation Principles 8.2 Computation of Net Assets of a Scheme and NAV 8.3 Dividends and Distributable Reserves 8.4 Entry and Exit Load and Its Impact on NAV 8.5 The Expense Ratio Framework: Base Expense Ratio, Brokerage and Statutory Levies 8.6 Key Accounting and Reporting Requirements 8.7 NAV, Total Expense Ratio and Pricing of Units for the Segregated Portfolio

9 Chapter 9: Taxation

9.1 Applicability of Taxes in Respect of Mutual Funds 9.2 Capital Gains on Mutual Fund Units 9.3 Dividend (IDCW) Income and Tax Deducted at Source 9.4 Stamp Duty and Securities Transaction Tax on Mutual Fund Units 9.5 Setting Off Capital Gains and Losses under the Income Tax Act 9.6 Tax Benefit under Section 80C and Applicability of GST

10 Chapter 10: Investor Services

10.1 The New Fund Offer Process 10.2 New Fund Offer Price and Ongoing Offer Price for Subscription 10.3 Investment Plans and Services 10.4 Allotment of Units and Account Statements 10.5 Mutual Fund Investors: Who Can Invest 10.6 Filling the Application Form for Mutual Funds 10.7 Financial Transactions with Mutual Funds 10.8 Cut-Off Time and Time Stamping 10.9 KYC Requirements for Mutual Fund Investors 10.10 Systematic Transactions and Their Operational Aspects 10.11 Non-Financial Transactions, Special Investor Categories and Turnaround Times

11 Chapter 11: Risk, Return and Performance of Funds

11.1 General and Specific Risk Factors 11.2 Factors That Affect Mutual Fund Performance 11.3 Drivers of Returns and Risk in a Scheme 11.4 Measures of Returns 11.5 SEBI Norms Regarding Representation of Returns 11.6 Risks in Fund Investing: The Investor's Perspective 11.7 Measures of Risk and Provisions Relating to Credit Risk

12 Chapter 12: Mutual Fund Scheme Performance

12.1 Benchmarks and Performance 12.2 Price Return Index or Total Return Index 12.3 Basis of Choosing an Appropriate Performance Benchmark 12.4 Benchmarks for Equity Schemes 12.5 Benchmarks for Debt Schemes and Other Schemes 12.6 Quantitative Measures of Fund Manager Performance 12.7 Tracking Error and Scheme Performance Disclosure

13 Chapter 13: Mutual Fund Scheme Selection

13.1 Scheme Selection Based on Investor Needs, Preference and Risk Profile 13.2 Risk Levels in Mutual Fund Schemes 13.3 Scheme Selection Based on Investment Strategy 13.4 Selecting a Scheme Across AMCs or Within a Scheme Category 13.5 Selecting Options in Mutual Fund Schemes and Do's and Don'ts

10.8 Cut-Off Time and Time Stamping

Key Takeaways Explain This Topic AI

The purchase cut-off is 1:30 PM for liquid and overnight schemes and 3:00 PM for all other schemes.

The redemption cut-off is 3:00 PM for all schemes including liquid and overnight.

For all schemes other than liquid and overnight, purchase NAV depends on realisation of funds regardless of amount.

Liquid and overnight purchases can obtain the previous day's NAV where funds are available before the cut-off.

Time stamping at an Official Point of Acceptance is the evidence of receipt and is subject to audit.

Last updated: August 2026

Why the Rules Exist

NAV is struck once a day after markets close. Without a cut-off, an investor could watch the market rise through the afternoon and then subscribe at a NAV computed before the rise, at the expense of existing unitholders. Cut-off timings and the realisation requirement close that gap.

The Cut-Off Timings

  • Transaction Liquid and overnight schemes All other schemes
  • Purchase 1:30 PM 3:00 PM
  • Redemption 3:00 PM 3:00 PM

Note the asymmetry: the earlier purchase cut-off applies only to liquid and overnight schemes , and only on the purchase side. Redemption is 3:00 PM across the board.

Realisation of Funds Governs Purchase NAV

Since 1 February 2021 , for all schemes other than liquid and overnight :

The applicable NAV for a purchase is that of the day on which the funds are available for utilisation by the scheme, irrespective of the amount invested .

The phrase "irrespective of the amount" matters historically. Before this change, purchases below INR 2 lakh received same-day NAV on receipt of the application, while larger purchases required realisation. That distinction is gone , and material describing a INR 2 lakh threshold is out of date.

So two conditions must both be met for same-day NAV on a purchase:

  • Application received at an Official Point of Acceptance before 3:00 PM, and
  • Funds available for utilisation by the scheme before the cut-off

If either fails, the next applicable day's NAV applies.

Liquid and overnight schemes work differently

For these schemes the purchase rule looks backwards :

Where the application is received before 1:30 PM and the funds are available for utilisation before the cut-off, the applicable NAV is that of the day immediately preceding the day of receipt.

Where either condition fails, the NAV of the day immediately preceding the next applicable day applies.

The logic is that liquid schemes accrue income daily and an investor whose money is available to the scheme should participate from the preceding day's valuation.

Redemption

For redemption there is no realisation question — the units already exist. The applicable NAV is that of the day the request is received at an OPA before 3:00 PM ; requests received after that receive the next business day's NAV.

One extension applies. Since 22 April 2025 , a redemption request in an overnight fund submitted online is treated as received on that business day if it arrives by 7:00 PM rather than 3:00 PM. The relaxation is confined to overnight schemes and to the online channel; a physical request at an OPA, and every request in a liquid scheme, still runs to 3:00 PM.

Time Stamping

Time stamping is the mechanism that makes cut-off rules enforceable and auditable.

Every application received at an Official Point of Acceptance is stamped with the date and time of receipt .

Stamping machines carry tamper-evident serial numbers , and electronic channels generate equivalent electronic logs.

Stamps run in continuous sequence , so a missing or out-of-sequence number is visible on inspection.

Records are retained and are subject to audit and SEBI inspection.

Cancelled or damaged stamps must be preserved and accounted for.

The stamp is the evidence. In a dispute about which NAV should have applied, the time stamp settles it.

The Distributor's Exposure

The rule that catches distributors:

Handing an application to the distributor is not receipt by the mutual fund. Receipt occurs when the application reaches an Official Point of Acceptance and is time stamped there.

A distributor who collects a cheque at 11:00 AM and submits it the following morning has cost the investor a day's NAV movement. If the distributor promised "today's NAV", they have also made a representation they did not keep.

Safe practice:

Submit the same day , and early enough to clear the cut-off

Explain that applicable NAV depends on receipt at the OPA and realisation of funds , not on when the form was handed over

For time-sensitive purchases, prefer electronic transfer over cheques, since realisation is faster and more predictable

Worked Scenarios

  • Scenario Applicable NAV
  • Equity scheme, application at OPA 2:15 PM Tuesday, funds realised Tuesday Tuesday
  • Equity scheme, application at OPA 2:15 PM Tuesday, funds realised Wednesday Wednesday
  • Equity scheme, application at OPA 3:40 PM Tuesday, funds realised Tuesday Wednesday
  • Liquid scheme, application at OPA 12:30 PM Tuesday, funds available before cut-off Monday
  • Liquid scheme, application at OPA 2:00 PM Tuesday Tuesday, being the day preceding the next applicable day
  • Redemption from an equity scheme, request at OPA 1:00 PM Tuesday Tuesday
  • Redemption from an equity scheme, request at OPA 4:00 PM Tuesday Wednesday

The second row is the one investors query most, and the answer is always the same: for purchases, the money must be with the scheme, not merely on its way.