The Practice of Investment Appraisal

Mehari Akalu and Rodney Turner

ERIM Report Series Research in Management from Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam

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: DCF methods; Investment appraisal; project; shareholder value analysis; value management techniques (search for similar items in EconPapers)
JEL-codes: G31 L2 M M10 (search for similar items in EconPapers)
Date: 2001-01-07
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Citations: View citations in EconPapers (1)

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