Which of the following responsibilities does not apply to taxable debt?

In the context of debt management, particularly with taxable debt, arbitrage tracking is not a responsibility typically associated with this type of debt. Arbitrage refers to the practice of borrowing at a lower interest rate and investing in higher-yield securities to earn a profit from the difference. This practice is primarily relevant to tax-exempt bonds, where the disparity between the tax-exempt status and taxable income creates an arbitrage opportunity.

Taxable debt does not have the same restrictions regarding arbitrage as tax-exempt debt, which is subject to specific regulations to prevent tax advantages through strategic financial maneuvers. Consequently, the responsibility for arbitrage tracking is not applicable to taxable debt, making this option correct.

On the other hand, primary disclosure, continuing disclosure, and obtaining a legal opinion are important aspects of managing taxable debt. Primary disclosure ensures that prospective investors receive essential information about the debt instrument at issuance. Continuing disclosure refers to the ongoing requirement to provide investors with significant financial information about the borrower after the debt has been issued. Legal opinions are essential for confirming the validity and enforceability of the debt obligations. These responsibilities are crucial to ensure transparency, compliance with securities regulations, and to protect the interests of investors in taxable debt situations.