The Practice of Investment Appraisal

Abstract

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.

Keywords: Investment appraisal, DCF methods, value management techniques, shareholder value analysis, project

JEL Classification: M, M10, L2, G31