Glossary of Municipal Securities Terms


In a refunding or other defeasance, a report prepared by a certified public accountant or other independent third party that verifies the yield of the investments held in escrow in connection with an advance refunding bond issue and demonstrates that the cash flow from investments purchased with the proceeds of the refunding bonds and other funds held in escrow are sufficient to pay the principal of and interest on the refunded bonds that are being defeased. See: ADVANCE REFUNDING; DEFEASANCE; ESCROW DEPOSIT AGREEMENT; REFUNDING.

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