Investment Appraisal Process

This case study examines the capital budgeting practices of two chemical companies. It is found that the companies apply the value management tools to supplement the DCF measures. In addition, the R&D projects are assessed using qualitative methods. Moreover, the study revealed the symptom of a trend shift in the choice of investment appraisal techniques from traditional DCF to the newly crafted value management models.DCF methods;project;investment appraisal;shareholder value analysis;value management techniques

The Practice of Investment Appraisal

This case study examines the capital budgeting practices of four companies operating in different industry. The findings indicate that most companies follow decentralised project decision-making. Despite the use of DCF techniques, there is a tendency to combine with the newly crafted value management tools, which shows a trend shift in the capital budgeting methods. In addition, firms are found trying to modify the original DFC tools so as to accommodate their needs. However, firms don't use the same technique from project inception to completion.DCF methods;project;shareholder value analysis;value management techniques;Investment appraisal

Investment Appraisal Process in the Banking & Finance Industry

We have studied how the banking and finance industry performs investment appraisal, measures subsequent follow-up and designates project success or failure. Furthermore, the authors looked into the extent of use of the new generation value management models. The result shows that firms are not using the same measurement scale in all stages of a project. Moreover, there is a tendency to shift from traditional appraisal methods to the new generation value management models.DCF methods;project;investment appraisal;shareholder value analysis;value management techniques

Adding Shareholder Value through Project Performance Measurement, Monitoring & Control

We present the various views and methods of measuring and controlling project performance, and factors affecting a project. The review indicates that there is a shift in the type and understanding of factors of project success or failure. However, the presence of various measurement methods, in addition to diverse interest groups, makes performance decision-making more complex and subjective. A holistic and uniform measurement approach is suggested for both project appraisal and subsequent follow-ups.value management techniques;DCF techniques;accounting based methods;performance appraisal;project success or failure

Measuring and Ranking Value Drivers

Analysis of the strength of value drivers is crucial to understand their influence in the process of free cash flow generation. The paper addresses the issue of value driver measurement and ranking. The research reveals that, value drivers have similar pattern across industries. Furthermore, it is found that the effect of operating cost and interest expenses, on free cash flow, is much more important than sales (revenue)

Evaluating the Capacity of Standard Investment Appraisal Methods

The survey findings indicate the existence of gap between theory and practice of capital budgeting. Standard appraisal methods have shown a wider project value discrepancy, which is beyond and above the contingency limit. In addition, the research has found the growing trend in the use of value management models. The presence of correlation between the frequency of monitoring and project value discrepancy, and the absence of uniformity in the use of evaluation methods throughout the life span of a project are among the results of the study

A Monte Carlo Comparison between the Free Cash Flow and Discounted Cash Flow Approaches

One of the debates in the capital budgeting model selection is between the free cash flow and DCF methods. In this paper an attempt is made to compare SVA against NPV model based on Monte Carlo simulations. Accordingly, NPV is found less sensitive to value driver variations and has got higher forecast errors as compared to SVA model

Investment Appraisal Process

This case study examines the capital budgeting practices of two chemical companies. It is found that the companies apply the value management tools to supplement the DCF measures. In addition, the R&D projects are assessed using qualitative methods. Moreover, the study revealed the symptom of a trend shift in the choice of investment appraisal techniques from traditional DCF to the newly crafted value management models

The Practice of Investment Appraisal

This case study examines the capital budgeting practices of four companies operating in different industry. The findings indicate that most companies follow decentralised project decision-making. Despite the use of DCF techniques, there is a tendency to combine with the newly crafted value management tools, which shows a trend shift in the capital budgeting methods. In addition, firms are found trying to modify the original DFC tools so as to accommodate their needs. However, firms don't use the same technique from project inception to completion

Investment Appraisal Process in the Banking & Finance Industry

We have studied how the banking and finance industry performs investment appraisal, measures subsequent follow-up and designates project success or failure. Furthermore, the authors looked into the extent of use of the new generation value management models. The result shows that firms are not using the same measurement scale in all stages of a project. Moreover, there is a tendency to shift from traditional appraisal methods to the new generation value management models