Derivatives valuations provider DerivActiv has indicated that it will provide a free 12 month swap payment cashflow verification report to all new customers. The vendor says that this is part of its drive to encourage firms to ensure their swap payments are calculated correctly so that accurate tax compliance calculations can be made, as well as expanding its customer base in a competitive market, of course.
The vendor claims that the unexpected events in the market have made it even more important for clients to use an independent calculation agent for their derivative calculations, including market valuation and ongoing payments. Johan Rosenberg, president of DerivActiv, explains: “Our experience is that payment calculation errors occur frequently, often at the expense of our client. We find the mistakes, point them out to the swap dealer and help our clients recover any lost amounts.”
In addition to recovering payments, DerivActiv analyses are used in the rebate calculations of tax exempt bond issues to ensure that the report is accurate, claims the vendor. It will provide an independent review of the past 12 months of payments for derivatives including plain vanilla swaps, swaptions, knock-outs, CMS swaps, equity swaps, foreign currency swaps, range accrual swaps and other exotic derivative structures.