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Project Guidelines: Projected Cash Flow Statements and Feasibility Analysis

The document outlines guidelines for creating a report on projected cash flow statements and feasibility analysis for a selected business project. It includes sections such as an executive summary, project description, cash flow statements, feasibility analysis, and conclusions with recommendations, emphasizing the importance of accurate data and clear presentation. Deliverables include a final report and a presentation, with evaluation criteria focusing on accuracy, depth of analysis, and professionalism.

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Ames Khalid
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31 views2 pages

Project Guidelines: Projected Cash Flow Statements and Feasibility Analysis

The document outlines guidelines for creating a report on projected cash flow statements and feasibility analysis for a selected business project. It includes sections such as an executive summary, project description, cash flow statements, feasibility analysis, and conclusions with recommendations, emphasizing the importance of accurate data and clear presentation. Deliverables include a final report and a presentation, with evaluation criteria focusing on accuracy, depth of analysis, and professionalism.

Uploaded by

Ames Khalid
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Project Guidelines: Projected Cash Flow Statements and Feasibility

Analysis
1. Project Selection:
Choose a Realistic Business Idea: Select a project that is feasible and can be realistically
analyzed. The business could be a startup, an expansion of an existing business, or any other
investment idea. Ensure the project has enough financial details available for analysis.
2. Structure of the Report:
The report should consist of the following sections:

a. Executive Summary

A brief overview of the project, including key assumptions and objectives.


b. Introduction

Description of the business project or investment idea.


Background and objectives of the project.
c. Projected Cash Flow Statements

Prepare cash flow statements for the next 3 to 5 years. These statements should reflect:

Inflows (revenue, investments, loans, etc.).


Outflows (operational costs, capital expenditures, loan repayments, etc.).
Operating cash flow, investing cash flow, and financing cash flow must be distinguished clearly.
Supporting Assumptions: Provide all the key assumptions (e.g., sales growth rate, cost
structures, inflation rates, working capital needs, etc.) used in preparing the projections.

d. Feasibility Analysis

Profitability Analysis: Analyze the projected cash flows to determine the profitability of the
project.
Net Present Value (NPV), Internal Rate of Return (IRR), and Payback Period should be
calculated and explained.
Risk Analysis: Identify potential risks to the project (market, operational, financial risks) and
discuss possible mitigation strategies.

Break-even Analysis: Conduct a break-even analysis to determine at what level of sales or


production the project will break even.

Sensitivity Analysis: Evaluate how changes in key assumptions (such as sales volume, cost of
materials, etc.) affect the feasibility of the project.

e. Conclusion and Recommendations

Based on the feasibility analysis, provide a recommendation on whether the project should be
pursued, modified, or abandoned.
3. Key Considerations:
Accuracy of Data: Ensure that all numbers and assumptions used are realistic and supported by
research or market analysis.
Clarity: The report should be easy to follow, with clear headings, subheadings, and explanation
of financial concepts.
Professional Presentation: Proper formatting, clear graphs, and tables are expected to enhance
the quality of the report.
4. Deliverables:
Final Report: A written report including all the sections mentioned above.
Presentation: A 10-15 minute presentation of your findings to the class or faculty panel.
5. Evaluation Criteria:
Accuracy and realism of the projected cash flows.
Depth of analysis in the feasibility section.
Understanding and application of financial concepts.
Professionalism and clarity of the report and presentation.

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