Question

What details are not required in a contract note as per SEBI regulations?

• A. Order number
• B. Client's personal bank account details
• C. Security name
• D. Trade price
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Hint:

A contract note focuses on the details of the trade itself. To protect investor privacy and security, sensitive personal financial data like bank account numbers are excluded from this document.

Answer 1

The Correct Option is B

Step 1: Understanding the Purpose of a Contract Note:
A contract note is a legally binding document issued by a stockbroker to a client at the end of a trading day. It serves as an official confirmation of all trades executed on behalf of that client.

Step 2: Reviewing Mandated Disclosures on a Contract Note:
To ensure transparency and prevent unauthorized trading, SEBI mandates that a contract note must include:
• Order Number and Trade Number
• Trade Time and Transaction Date
• Security Symbol Name
• Buy Sell action
• Trade Quantity and Execution Price
• Itemized Brokerage Charges and Statutory Taxes (STT, GST, Stamp Duty, SEBI turnover fees)

Step 3: Identifying Non-Essential Disclosures:
While the broker must maintain the client's bank details in their internal database for funds settlement, this sensitive personal financial information is not required to be printed on the daily contract note (B).