Who can be a Compliance Officer under SEBI (PIT) Regulation, 2015? Will an Engineering graduate from a top engineering college with 5 years of experience working as Chief Technical Officer (CTO) be a Compliance Officer ?

According to the Regulation 2(c) of SEBI (Prohibition of Insider Trading) Regulations, 2015 'Compliance Officer' means any senior officer, designated so and reporting to the board of directors or head of the organization in case board is not there, who is financially literate and is capable of appreciating requirements for legal and regulatory compliance under these regulations and who shall be responsible for compliance of policies, procedures, maintenance of records, monitoring adherence to the rules for the preservation of unpublished price sensitive information, monitoring of trades and the implementation of the codes specified in these regulations under the overall supervision of the board of directors of the listed company or the head of an organization, as the case may be. Explanation - For the purpose of this regulation, 'financially literate' shall mean a person who has the ability to read and understand basic financial statements i.e. balance sheet, profit and Loss account, and statement of cash flows As per the explanations, a person can be compliance officer only if he understands the basic financial statement. An engineer graduate who has experience of working as Chief Technology Officer can neither understand the basic financial statement i.e. balance sheet, profit and loss account, and statement of cash flows nor capable of understanding legal and regulatory compliance. Hence he is not eligible for appointment as compliance officer.