Refunding Verifications Overview

In 2002—at the request of financial advisors and bond attorneys who had developed a high level of confidence in AMTEC’s ability to provide accurate calculations for reasonable fees—we began providing refunding verification services to our arbitrage rebate clients. AMTEC has issued thousands of refunding verification reports throughout its history. Our clients utilize a variety of financing tools such as fixed and variable rate debt, tax-exempt and taxable issuances, and current and advance refinancings, as well as Open Market Securities (OMS) and State and Local Government Series (SLGS) securities. Our team coordinates closely with the financial advisor, underwriter, issuer and other parties throughout the process to ensure accurate results are achieved.

As part of AMTEC’s refunding verification services, clients receive the following:

  • Verbal/written verification within two hours of receiving the final pricing schedules
  • Completion of a draft verification report within 24 hours of receiving the final pricing schedules
  • CPA certification when required

AMTEC will coordinate with the issuer, underwriter, financial advisor and any other party (the “working group”) to ensure that necessary information concerning the refunding bonds, the refunded bonds and the escrow investments is accurately and completely transmitted and included in the refunding verification report. Each transaction is assigned a team of dedicated professional staff working closely together to complete the transaction. Our expertise and team approach guarantees that the requirements of the issuer are met in a timely manner.

Prior to the pricing of the refunding bonds, we conduct a pre-verification of the pricing calculations to ensure the accuracy of the refunding bonds structure, refunded bonds information and proposed escrow. This step ensures that we are performing the calculations using the same assumptions as the working group. Pre-verification allows our staff to continuously update the transaction as the financing structure and market assumptions change.

For each transaction, we utilize the original official statements and other primary source documents of the refunded bonds to construct a database of all potential refunded bonds, including previously retired or defeased maturities. This effort provides an important control in the refunding verification process that may be overlooked by other parties.

On the date of the pricing, the utilization of the pre-verified transaction structure allows our team to seamlessly confirm the accuracy of the entire transaction and promptly issue our written confirmation of verification. Upon issuing our written confirmation, we prepare a draft refunding verification report for distribution to the entire working group. Our reports are created using DBC Finance, the industry leading municipal finance software, which enables us to structure our reports to reflect an unlimited number of prior bonds that can be shown individually for purposes of clarity, as well as in consolidated schedules for escrow cash flow and sufficiency purposes.

AMTEC’s skilled technical staff completes a series of internal manual reviews that, when added to the controls provided by our software, guarantee the accuracy of our reports. Each time a report is changed, the entire automated and manual review process employed by AMTEC is repeated. Once finalized, the refunding verification report is distributed electronically to the entire working group.