Investment appraisal

The investment appraisal, which is part of the business case, will, if properly structured, improve the decision-making process regarding the desirability or viability of the project. It should have examined all the realistic options before making a firm recommendation for the proposed case. The investment appraisal must also include a cost/benefit analysis and take into account all the relevant factors such as:

• capital costs, operating costs, overhead costs

• support and training costs

• dismantling and disposal costs

• expected residual value (if any)

• any cost savings which the project will bring

• any benefits which cannot be expressed in monetary terms.

To enable some of the options to be compared, the payback, return on capital, net present value and anticipated profit must be calculated. In other words, the project viability must be established.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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