1
Q
What might be included in the initial capital cost of a project?
A
- purchase of non-current assets
- net book value of existing assets
- investment in working capital
- capitalised research and development expenditure
2
Q
What are the two basic approaches to project appraisal?
A
1 Non-discounting methods
2 Discounted cash flow methods
3
Q
What are two non-discounting methods of project appraisal?
A
1 Payback method
2 Accounting rate of return
4
Q
What are three discounted methods of project appraisal?
A
1 Net present value
2 Internal rate of return
3 Discounted payback
Decks in class (161)
# Cards
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1.1 Regulatory framework - introduction6
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1.2 The need for a regulatory framework14
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1.3 Agency theory and the role of corporate governance7
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1.4 The role of financial accouting standards3
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1.5 Arguments against accounting regulation5
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1.6 National & company law7
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1.7 International financial reporting standards15
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1.8 Barriers to global harmonisation1
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1.9 Principal differences between IFRS and UK GAAP2
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1.10 Environmental reporting18
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1.11 Social accounting5
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Audit (Campbell's Notes)15
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2.1 Conceptual Framework of Financial Reporting2
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2.2 The need for a conceptual framework8
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2.3 Objectives of general purpose financial reporting9
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2.4 Qualitative characteristics of financial information10
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2.5 Financial statements and reporting3
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2.6 Assumptions underlying financial statements2
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2.7 Elements of financial statements6
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2.8 Recognition and derecogition of the elements of financial statements6
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2.9 Measuring the elements of financial statements11
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2.10 Presentation and disclosure2
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2.11 Concepts of capital and capital maintenance9
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3.1 Preparation and presentation of single entity financial statements3
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3.2 Objective of financial statements1
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3.3 Presentation of financial statements2
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3.4 Fair presentation and compliance with IFRS2
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3.5 Overriding concepts of financial statements9
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3.6 Structure and content of financial statements3
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3.7 Statement of profit or loss and other comprehensive income10
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3.8 Statement of financial position (balance sheet)9
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3.9 Statement of changes in equity4
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3.10 Statement of cash flows7
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4.1 Other contents and features of published accounts2
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4.2 Content of the annual report and accounts0
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4.3 The strategic report or business review11
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4.4 The directors' report4
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4.5 Notes to the accounts1
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4.6 Segment reporting8
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4.7 Reporting the substance of transactions1
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4.8 Limitations of published accounts8
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5.1 Interpreting accounting policies based on IFRS0
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5.2 Accounting policies10
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5.3 Accounting for inventories10
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5.4 Accounting for property, plant and equipment11
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5.5 Accounting for events after the reporting period6
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5.6 Revenue from contracts with customers4
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5.7 Provisions, contingent liabilities and contingent assets5
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6.1 Financial reporting by groups of companies3
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6.2 Requirement to prepare consolidated financial statements3
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6.3 Principles for the consolidation of financial statements7
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6.4 Business combinations, fair value measurement and goodwill13
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6.5 Consolidated statement of financial position2
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6.6 Consolidted statement of comprehensive income3
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6.7 Investments in associates and joint ventures7
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6.8 The IAS 28 equity method2
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6.9 A parent company's separate financial statements2
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6.10 Exemptions from preparing consolidated financial statements4
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7.1 Analysis and evaluation of financial statements3
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7.2 The need for financial analysis9
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7.3 Fundamental analysis7
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7.4 Economic analysis1
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7.5 Industry analysis4
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7.6 Company analysis2
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7.7 Trend analysis8
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7.8 Ratio analysis3
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7.9 Profitability ratios17
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7.10 Limitations of ratio analysis2
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7.11 Earnings management or creative accounting15
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8.1 Financial markets and the identification of financing needs1
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8.2 Financial markets15
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8.3 Private versus public markets8
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8.4 The role of the stock exchange2
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8.5 Efficient market hypothesis3
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8.6 Alternative investment market4
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8.7 The role of other sources of finances: private markets15
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8.8 Identification of financing needs: budgeting and forecasting12
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8.9 The need for cash and cash management12
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9.1 Sources of long-term finance7
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9.2 Equity or ordinary shares11
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9.3 Retained earnings3
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9.4 Preference shares8
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9.5 Debentures and bonds12
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9.6 Bank and institutional loans4
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9.7 Leasing7
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9.8 Hire purchase4
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9.9 Securitisation of assets6
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9.10 Private finance initiatives6
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9.11 Government grants and assistance4
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10.1 Sources of short-term finance2
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10.2 Exernal sources of short-term finance1
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10.3 Bank and institutional loans8
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10.4 Overdrafts5
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10.5 Bills of exchange5
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10.6 Debt factoring4
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10.7 Invoice discounting3
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10.8 Alternative finance and web innovations8
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10.9 Internal sources of short-term finance1
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10.10 Controlling working capital2
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10.11 Reducing inventory levels4
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10.12 Tighter credit control3
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10.13 Delaying payments to payables4
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10.14 Sale of redundant assets2
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10.15 Retained profits0
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11.1 The cost of capital and capital structure2
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11.2 The importance of the cost of capital3
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11.3 The cost of equity using the capital asset pricing model13
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11.4 Cost of capital using the dividend valuation model2
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11.5 The cost of debt5
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11.6 The weighted average cost of capital1
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11.7 Capital structure2
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11.8 Factors affecting capital structure8
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11.9 Financial gearing8
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11.10 Operating gearing2
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11.11 The traditional approach to capital structure2
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11.12 The Modigliani and Miller theory of capital structure1
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11.13 Real world approaches2
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12.1 Working capital management1
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12.2 The nature and purpose of working capital]4
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12.3 The working capital cycle8
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12.4 Working capital management: profitability versus liquidity4
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12.5 Working capital ratios10
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12.6 The management of inventories20
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12.7 The management of recievables10
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12.8 The management of payables1
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13.1 Risk assessment in investment appraisal technique0
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13.2 Risk and investment decisions1
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13.3 Risk assessment models2
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13.4 Sensitivity analysis4
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13.5 Scenario analysis3
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13.6 Simulation modelling2
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13.7 Expected net present value7
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13.8 Event tree diagrams3
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13.9 The role of portfolio management9
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14.1 Company analysis and business valuation methods0
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14.2 Investment valuation ratios4
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14.3 Earnings per share6
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14.4 Price/earnings ratio4
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14.5 Relative value measures2
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14.6 Valuation using dividend discount model4
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14.7 Valuation using discounted cash flows1
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14.8 Valuation using the capital asset pricing model2
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14.9 The application of efficient market hypothesis in business valuation1
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14.10 Shareholder value analysis9
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14.11 Economic value added as an alternative to SVA5
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14.12 Measuring value creation2
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15.1 Project appraisal techniques1
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15.2 Identification and analysis of projects0
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15.3 Factors affecting project appraisal2
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15.4 Project appraisal techniques4
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15.5 Non-discounted methods: payback period5
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15.6 Non-discounting methods: accounting rate of return (ARR)6
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15.7 Discounted cash flow techniques based on the time value of money9
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15.8 Discounted cash flow methods: net present value5
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15.9 Discounting annuities5
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15.10 Discounted cash flow methods: internal rate of return4
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15.11 Discounted cash flow methods: discounted payback4
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15.12 Impact of inflation and tax on project appraisal3
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15.13 Capital rationing and use of the profitability index8
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International Accounting Standards20
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Weak Areas62
