Respondents are required to provide their proposed Financial Close Adjustment Protocols, for incorporation into the final Project Documents, which should outline the general strategy for preserving value for money for the State through the Financial Close process and detail the following:
• protocols for determining the reference rates for input into the Financial Model, including (for interest rates underlying Respondents' Proposals):
- 'screen dumps' of relevant market rates; and
- protocols/methodology for determining the inputs to the Financial Model based on the relevant reference rates;
• steps required for updating and solving the Financial Model, including:
- input of dates, reference rates and relevant cell references; and
- the process for solving/optimising the Financial Model;
• all minimum conditions that are to be met after solving the Financial Model, e.g. minimum equity Internal Rate of Return (IRR), Debt Service Coverage Ratio (DSCR) and Loan Life Coverage Ratio (LLCR) and maximum gearing levels;
• where macros are proposed to be used, the objective of the macro and a summary of the steps undertaken by the macro;
• process, timing and parties involved on the day of Financial Close; and
• cell references to the Service Payment outputs in the Financial Model that form the basis of populating the relevant Schedule of the Project Deed.
Note to Respondents: The State risk margin of [15 basis points] to reflect the estimated cost to the State of managing interest rate exposure beyond the hedged period specified in Appendix 7 (Financial Model Instructions) to this Volume 1, Part B (Evaluation Criteria and Proposal Requirements) should be removed from the Financial Close Financial Model through the Financial Close Adjustment Protocols.