Investment projects

Although most companies use only revenue and expense figures when comparing investment projects, income-tax effects can enter into each calculation if either revenues or expenses change from the baseline values. More expenses mean lower profits and fewer taxes, and vice versa. If a company needs to know the effect of income taxes on profit, the computations are simple and can be done during or after... 

Expenditure on corrosion prevention is an investment and appropriate accountancy techniques should be used to assess the true cost of any scheme. The main methods used to appraise investment projects are payback, annual rate of return and discounted cash flow (DCF). The last mentioned is the most appropriate technique since it is based on the principle that money has a time value. This means that a given sum of money available now is worth more than an equivalent sum at some future data, the difference in value depending on the rate of interest earned (discount rate) and the time interval. A full description of DCF is beyond the scope of this section, but this method of accounting can make a periodic maintenance scheme more attractive than if the time value of money were not considered. The concept is illustrated in general terms by considering a sum of money P invested at an... 

Cash flows used in calculating net present value (NPV) and internal rate of return (IRR) for a typical capital investment project. 

Like all major capital investment projects, the financial case is based on the financial return, however measured, and the availability of finance. 

Articles and press releases on the pharma and FC industries investment projects... 

The use of uniform costs of capital to evaluate all investment projects of a company implies that the risk associated with each individual investment equals the company s average risk. As this is often not the case in diversified companies, the use of more differentiated business unit or project specific cost of capital has been suggested in literature (cf. Brealey et al. 2006, pp. 215-218). 

Micallef 1981, p. 47 Chase et al. 1988, p. 35 Weiner 1992, p. 20). Nevertheless, according to Kobrin (1979, p. 75) political risks are rarely included explicitly into the analysis of major investment projects. 

Global ethylene capacity is predicted to increase from 114 to 145 million metric tons (mmt) from 2004 to 2010, and the Middle East s share of the market is expected to grow from nine to 17 percent (Fig. 7.3). This implies that about 40 percent of new ethylene capacity will be built in the region. Major capital investment projects are already under way, including Sumitomo s joint venture with Aramco of Saudi Arabia. Aramco-Sumitomo will take over Aramco s oil refinery and crack 1.3 mmt of ethylene and 50,000 tonnes of propylene a year, together with 850,000 tonnes of propylene from a separate facility. Borouge, a 60/40 joint venture between Abu Dhabi National Oil Company (ADNOC) and Borealis, is... 

The Chinese chemical market is attracting huge foreign direct investments. Between 1993 and 2003, investment projects amounted to around EUR 20 billion of contractual FDI, with Bayer, BASF, Shell, and BP the four biggest investors. Over the last ten years, five percent of foreign direct investment was into the chemicals sector. Multinational corporations (MNCs) tend to enter via joint ventures partially driven by the need for feedstock access, but wholly foreign-owned enterprises will become more common following China s membership of the WTO. 

In 2005, BASF will celebrate its 140th anniversary and can look back on 120 years of trade with China. This year BASF also starts up the largest investment project in the history of the company its new Verbund site in Nanjing, China. This article analyzes China s key role in achieving BASF s strategic goals in Asia and reviews BASF s progress in the country. 

A major part of the early stages of any investment project will involve the raising of the necessary finance for it, from internal or external sources, and at the lowest cost. A correspondingly important part of the appraisal process is therefore to examine the various sources of funds, and to try to put some relative value or cost on them. 

Internal Rate of Return (IRR). This is a measure of how much improvement in cash flow results from the investment (project cost) as measured by a percent return. This is roughly equivalent to the interest rate that an investment would earn if invested in a bank or in bonds. A company usually has a measurement called a hurdle rate that defines the minimum acceptable rate that a profit-adding project must have before it is approved for expenditure. In many companies, this rate is the rate it... 

The following portfolio of investment projects has been proposed for a company for next year ... 

These five institutions described above are flanked by five other important EU bodies, that is, the European Economic and Social Committee (expresses the opinions of organized civil society on economic and social issues), the Committee of the Regions (expresses the opinions of regional and local authorities), the European Central Bank (responsible for monetary policy and managing the euro), the European Ombudsman (deals with citizens complaints about misadministration by any EU institution or body), and the European Investment Bank (helps achieve EU objectives by financing investment projects). 

Only investment projects were accepted as early action measures. 

In the chemical process industries, an investment project may arise from any of a range of activities. It may be a minor modification to an existing plant, a major plant expansion or revamping, a completely new plant (on an existing or greenfield site) or the development of an entirely new process or product. For a major or a new plant, economic... 

The Estonian National Monitoring Centre (NMC) is installed within the Estonian Environmental Research Centre (ERC) in Tallinn. All measuring results from monitoring sites are collected and processed at NMC using a software product of an Austrian company, as a part of a PHARE investment project. On this basis, experts of NMC prepare monthly and yearly reports on air quality and reports concerning certain evaluations of a specific interest. On-line presentation of information to the public is provided via the INTERNET. Within Estonia all monitoring of air pollution is carried out at the Estonian Environmental Research Centre. 

KEY N = Life of investment project Q = Cash flow profile KEY N - Life of Investment Project Q - Cash-flow profile. 

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