What is a statement of deviation? SEBI Reg 32

A statement of deviation is the quarterly filing in which a listed Indian company tells the stock exchanges whether it spent the money it raised on the things it said it would. It covers proceeds from a public issue, a rights issue, a preferential issue or a QIP, and it reports both outright deviations from the stated objects and the category wise variation between projected and actual use of funds. The audit committee has to review it before it goes out. It is not investment advice.

What does a statement of deviation disclose?

Two different things, and the distinction is the whole point of the filing.

A deviation means the money went somewhere other than an object stated in the offer document or, for a preferential issue or QIP, in the explanatory statement to the notice calling the general meeting. A variation is narrower: the object is unchanged, but the amount spent against it differs from the amount projected. Regulation 32(1) asks for both, and the variation is reported category wise, so you see it per object rather than as one net number.

If there is nothing to report, the company still files. A run of statements saying no deviation is itself information, and it is the reason a single quarter with a real deviation stands out on the exchange feed.

Who signs off before it is filed?

The audit committee. Regulation 32(3) requires the statement to be placed before the audit committee for review, and only after that review is it submitted to the exchanges. The audit committee's comments travel with it because SEBI's prescribed filing format has a field for them, not because the sub-regulation says so. That field lives in the format under SEBI's LODR master circular, carried into the quarterly Integrated Filing (Financial) annexure. Two further obligations sit alongside it:

• Regulation 32(4): where funds were used differently from what the offer document said, the company must explain the variation in the directors' report in the annual report.
• Regulation 32(5): an annual statement of funds used for purposes other than those stated must be certified by the statutory auditors and placed before the audit committee.

So the same facts surface three times: quarterly to the exchanges, annually with an auditor's certificate, and in the directors' report. A company that changed its mind about where the money goes cannot report it once and move on.

When is the statement of deviation filed?

Regulation 32 sets the frequency as quarterly, and in practice the statement travels with the quarterly results cycle. Regulation 33 requires quarterly financial results within 45 days of each quarter-end and annual results within 60 days of the financial year-end, so that is the window in which these statements appear on the NSE and BSE announcement feeds.

Where it sits on the feed changed recently. For quarters from the one ended December 31, 2024, the statement is filed as a table inside the quarterly Integrated Filing (Financial) rather than as a standalone announcement. The timelines did not change, but if you are searching an exchange feed for a separate "statement of deviation" filing after that date, look inside the integrated filing instead.

One exception is easy to miss. Regulation 32(8) reads every reference to "quarterly" and "quarter" in the regulation as "half yearly" and "half year" for a company listed on an SME exchange. If you are tracking an SME issuer, two filings a year is compliance, not a gap.

How does it differ from the monitoring agency report?

They answer the same question from opposite sides of the table.

Where both exist, Regulation 32(6) requires the company to submit the monitoring agency's comments or report to the exchanges too, and Regulation 32(7) puts those reports before the audit committee quarterly, promptly upon receipt, a frequency substituted for "an annual basis" with effect from January 24, 2022. Read together, you get the company's own account and an outside agency's check on the same rupees. The detail of the second one is covered in what is a monitoring agency report.

So, what is a statement of deviation: a quarterly, audit-committee-reviewed disclosure of whether issue proceeds went where the offer document said, filed until the money is fully used. It is the cheapest way to check whether a company that raised capital for a stated plan is actually executing it, and it sits in the same announcement stream as the rest of a company's material event disclosures and the objects set out in its red herring prospectus. Flock reads these public filings and keeps each one stamped with its date and source. What any of it means for you is your call to make.