Appraisal Techniques of Public Investments and Projects

62994 Words Apr 9th, 2013 252 Pages
Ministry of Finance and Economic Planning
National Development Planning Directorate
Public Investment Technical Team Unit

Capacity Building to Support the Rwanda
Public Investment Program
Investment Appraisal Training Manual for
Government Staff

Prepared by
Sulaiman Kyambadde
P.O. Box 1851 Kigali, Rwanda
Tel: +250 255114413 (office)

October 2011
The purpose of this Training Manual is to help PITT implement the use of international best practices of Investment Appraisal techniques in its programming of public sector investments. It describes how public sector investments should be assessed at conception or programming stage. The modules introduce the basic concepts behind the appraisal techn iques and their applicability
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3.2.2 Typical investment considerations ......................................................................................23
3.3 Defining annual cash flows ...................................................................................................24
3.4 Performance measures, decision criteria and the issues involved ............................... 25
3.4.1 Net present value ....................................................................................................................26
3.4.2 Net future value.......................................................................................................................26
3.4.3 Internal rate of return .............................................................................................................26
3.4.4 Benefit-to-cost ratios ...............................................................................................................29
3.4.5 The payback period ................................................................................................................30
3.4.6 The peak deficit .......................................................................................................................30
3.5 Review of DCF performance criteria ..................................................................................31
4.
Module 3: Evaluation methods
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