Pooled finance municipal offer document: Schedule IB

A pooled finance municipal offer document has to describe two things at once: the vehicle issuing the bond and the municipalities whose revenue will pay it. SEBI wrote a dedicated disclosure schedule for exactly that shape in July 2026. This guide walks the pooled finance municipal offer document head by head, from the instructions paragraph to the risk factors, and flags the tables that carry the information a reader actually needs. It is not investment advice.

When does Schedule IB apply?

By its own heading, and by three cross references.

The heading limits it to a special purpose vehicle set up for the purpose of raising funds for a person performing one or more functions entrusted under Article 243W of the Constitution of India, which is the constitutional provision under which municipal functions are devolved. The vehicle itself is governed by Regulation 5A, described in what is a pooled finance municipal bond.

The same amendment inserted the words "or Schedule IB, as applicable" into Regulation 6(2)(a) for the offer document, Regulation 14A(2)(a) for the private placement memorandum, and Regulation 27(3). So the schedule is reached from the public issue route, the private placement route and the continuing obligations route alike, and paragraph 2 confirms it covers both a public issue and a private placement of securities intended to be listed.

Paragraph 1 sets the drafting rules before any content: information relevant and updated, source and basis of all statements and claims disclosed, blanks filled before registering the document, plain English, cross references by paragraph heading and page number, no forward looking statements that cannot be substantiated, one consistent voice, and a single presentation currency.

The 13 heads of a pooled finance municipal offer document

Which heads carry the pooled structure?

Heads 8 and 9, mostly, because that is where the constituent municipalities appear as named subjects rather than as background.

Head 8 asks for a table of key financial figures for the constituent municipalities and the issuer for the last three years, separately. The rows include revenue income, revenue expenditure excluding interest, operating revenue surplus, interest expense, principal repayment outside the sinking fund, contribution to sinking fund, capital income and expense, deposits and advances, opening and closing cash and sinking fund balances, total debt, the ratio of total expenditure to total revenue, cash surplus to total revenue, and the ratio of debt service to total revenue.

Two more tables sit under the same head. Top five revenue sources of the constituent municipalities for three years, and a property tax table giving demand raised split into arrears and current, collections split the same way, and both an overall collection ratio and a current collection ratio. For a municipal credit those collection ratios are among the few operating numbers that are directly comparable across issuers.

Head 8 also requires borrowings of the issuer and the constituent municipalities as on the latest quarter end, broken into secured facilities, unsecured facilities, NCDs and bonds, the top ten debenture holders by value on a cumulative basis, commercial paper outstanding by maturity date, the rest of the borrowings, and any borrowings issued for consideration other than cash. It closes with two narrative items: sufficient revenue generation and resources for timely servicing and redemption, and estimated scenarios of asset liability mismatches with the efforts intended to resolve them.

Head 9 extends litigation, creditor dues and non-payment of statutory dues to the constituent municipalities as well as the issuer, and asks for all defaults and delays in payment of interest and principal on any term loans, debt securities and other financial instruments issued by the issuer in the past three years.

An issuer in existence for less than three years and placing privately may disclose the financial statements for its period of existence instead, which is a proviso appearing twice in head 8.

The parts that are hosted rather than printed

Three items in Schedule IB are satisfied by a link and a Quick Response code to a page on the issuer's website rather than by content in the document itself:

1. Abridged balance sheet, income and expenditure and receipts and payments accounts of the constituent municipalities and the issuer.
2. Budget documents for the previous three years containing actual financial performance or revised estimates, along with related party transactions of the constituent municipalities.
3. Creditor details, including the consolidated number and aggregate amount for the issuer and constituent municipalities, information on dues to micro, small and medium enterprises, and complete details of material creditors by name and amount.

The document tells you where to look. The numbers live on a web page, which means a reader checking a pooled finance issue has to follow those links rather than read the prospectus alone, and has to note when the linked page was last updated.

A numbering quirk worth knowing

The English text of the amendment mis-numbered two lists, and SEBI fixed it separately.

A corrigendum notified as SEBI/LAD-NRO/GN/2026/314, made on 23 July 2026 and published on 29 July 2026, corrected the numbering in the English version of Schedule IB. In paragraph 9.a the clauses numbered (vi) to (x) are to be read as (i) to (v), and in paragraph 9.b the clauses numbered (iv) to (vi) are to be read as (i) to (iii). The substance did not change, only the labels.

It is a small thing that matters for citation. Anyone quoting Schedule IB paragraph 9.a(vi) from the original gazette is quoting a clause that is now clause (i).

What to do with the document once you have it

Read head 5 against head 8. Head 5 is the promise, since it requires the proceeds to be clearly earmarked for a defined project or set of projects, with location, phased costs, an investment plan approved by the local authority, an implementation schedule, milestone dates for all components, the status of regulatory approvals, and a full break up of issue expenses. Head 8 is the capacity to keep it.

Head 7 is where the protection sits, including the detailed rating rationale not older than one year at issue opening, the credit rating letter not older than one month, credit enhancement mechanisms with complete details, and the escrow payment mechanism for repayment of interest and principal, which for a pooled issuer is the two step structure. The instrument itself is covered in what are municipal debt securities, the schedule this one sits beside in Schedule I vs Schedule IB, and the filings that follow the issue in how to read a municipal bond disclosure.

Flock reports public regulatory filings with every claim sourced and dated. What any of it means for your money is your call to make.