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Circuits can be simplified for combinational equivalence checking by transforming internal functions, while preserving their ranges. In this paper, we investigate how to effectively apply the idea to improve equivalence checking. We propose new heuristics to identify groups of nets in a cut, and elaborate detailed aspects of the new equivalence checking method. With a given miter, we identify a group of nets in a cut and transform the function of each net into a more compact representation with less variables. These new compact parametric representations preserve the range of nets as well as of the cut. This transformation significantly reduces the size of intermediate BDDs and enables the verification to be conclusive for many designs which state-of-the-art equivalence checkers fail to verify. Iterative groupings and transformations are performed until no grouping is possible for a cut. Then we proceed to the next cut and continue until the compare point is reached. Our experimental results show the effectiveness of our strategy and new grouping heuristics on the new method.