<p>In much of the recent times the practitioner’s fraternity has been focused towards making investment decisions, based on traditional financial evaluation techniques ranging from Net present Value (NPV), Internal Rate of Return (IRR), Pay Back Period, Profitability Index. Although these techniques have performed satisfactorily and have provided practitioners’ insights about how to value investments and thereby providing them a holistic view of the project and making informed decisions. However, these traditional techniques have focused more on quantifying the risk assessment done at the beginning of the project, by taking into consideration an optimal discount rate based on the firm’s overall cost of capital, and the additional risk associated with the given project. Nevertheless, these traditional Discounted Cash Flow (DCF) techniques, fails to take into account the value of managerial flexibility in business environments associated with a high degree of uncertainty, thereby not encapsulating the value of different options which are embedded within the project, that managers possess and the value of new information during the project lifecycle. In order to value these options, Real Options Valuation technique has been proposed, which predominantly traces its origin from valuing financial options. Though various academicians have supported this technique and the potential benefits it offers to organizations while making investment decisions, it still rests on a number of assumptions, which needs to be validated across different businesses. Therefore, this study focuses on understanding the obstacles involved with the implementation of Real Options Valuation technique, based on the three roadblocks identified by Lander and Pinches (1998).</p><p>A qualitative study using semi-structured interviews was conducted within a given case company X in Sweden. Wherein based on the existing financial evaluation technique that company X uses while making investment decisions are analyzed. Based on the responses provided by the company X officials, the study revealed that company X employs traditional financial evaluation techniques, since they are been widely accepted across a wide range of industries, and also decision makers, and shareholders tend to prefer a probabilistic risk assessment at the beginning of the project, however company X do acknowledge the potential benefits offered by Real Options Valuation technique, but they are not been implemented, because of its ignorance among the key decision makers, coupled with complex mathematical calculations and various assumptions that needs to be incorporated while using Real Options approach for valuing investments, which makes it difficult in the context of given company X for using Real Options approach for valuing investments.</p>

In much of the recent times the practitioner’s fraternity has been focused towards making investment decisions, based on traditional financial evaluation techniques ranging from Net present Value (NPV), Internal Rate of Return (IRR), Pay Back Period, Profitability Index. Although these techniques have performed satisfactorily and have provided practitioners’ insights about how to value investments and thereby providing them a holistic view of the project and making informed decisions. However, these traditional techniques have focused more on quantifying the risk assessment done at the beginning of the project, by taking into consideration an optimal discount rate based on the firm’s overall cost of capital, and the additional risk associated with the given project. Nevertheless, these traditional Discounted Cash Flow (DCF) techniques, fails to take into account the value of managerial flexibility in business environments associated with a high degree of uncertainty, thereby not encapsulating the value of different options which are embedded within the project, that managers possess and the value of new information during the project lifecycle. In order to value these options, Real Options Valuation technique has been proposed, which predominantly traces its origin from valuing financial options. Though various academicians have supported this technique and the potential benefits it offers to organizations while making investment decisions, it still rests on a number of assumptions, which needs to be validated across different businesses. Therefore, this study focuses on understanding the obstacles involved with the implementation of Real Options Valuation technique, based on the three roadblocks identified by Lander and Pinches (1998). A qualitative study using semi-structured interviews was conducted within a given case company X in Sweden. Wherein based on the existing financial evaluation technique that company X uses while making investment decisions are analyzed. Based on the responses provided by the company X officials, the study revealed that company X employs traditional financial evaluation techniques, since they are been widely accepted across a wide range of industries, and also decision makers, and shareholders tend to prefer a probabilistic risk assessment at the beginning of the project, however company X do acknowledge the potential benefits offered by Real Options Valuation technique, but they are not been implemented, because of its ignorance among the key decision makers, coupled with complex mathematical calculations and various assumptions that needs to be incorporated while using Real Options approach for valuing investments, which makes it difficult in the context of given company X for using Real Options approach for valuing investments.

Marine diamond mining as practiced on the west coast of southern Africa is considered to be a high-risk venture. Investment decisions can be eased by using simulations to model likely outcomes. This study utilised Net Present Value (NPV) to measure the impact of sampling and grade estimation decisions on a marine diamond mining project. It focused on aspects such as the accurate determination of geological conditions, the influence of the degree of error in the geostatistical estimation process, sample density and sample support size. A simulated deposit was constructed that could be sampled using various parameters to measure the sensitivity of NPV. Various scenarios and their related NPV's showed that exploration costs have a small impact on a project in comparison with other cost aspects. However, the decisions made in the exploration process do have a significant impact on the NPV of a project. Inaccuracy in recovery efficiency and mining rate prediction, lead to a decline in NPV. Misfitting the semi-variogram model had a smaller impact on the NPV than the other scenarios investigated, but the importance of reflecting the true variance of the deposit in financial terms was evident. Finding the optimal sampling density and support size do have a positive effect on NPV. It is believed that the method demonstrated in this study can be used as a guide to add value in the selection of optimal parameters when planning exploration campaigns in marine mining projects. AFRIKAANS : Mariene diamant ontginning, soos beoefen aan die weskus van suidelike Afrika, is 'n hoe risiko ondememing. Beleggings besluite kan vergemaklik word deur simulasies te gebruik om moonlike resultate te modeleer. Hierdie studie het Netto Huidige Waarde (NHW) gebruik om die impak van steekproefneming en skattings besluite op 'n mariene diamantontginning projek te meet. Aspekte soos die korrekte bepaling van geologiese kondisies, die invloed van foute in die geostatistiese skattings proses, steekproef spasieering en steekproef grootte, is ondersoek. 'n Afsetting is met 'n simulasie geskep. Steekproewe is dan geneem van die afsetting om NHW sensitiwiteit teenoor verskeie parameters te meet. Verskeie scenarios en hulle verwante NHW's het gewys dat, in vergelyking met ander kostes, eksplorasie kostes 'n klein impak op 'n projek het. In teenstelling hiermee is die impak van besluite wat geneem word in die eksplorasie fase groot. Onakkurate herwinnings effektiwiteit en ontginningstempo skattings lei tot 'n afname in NHW. Swak modelering van die semi-variogram het 'n kleiner invloed op NHW, maar die belangrikeid daarvan om die ware variansie van die afsetting te reflekteer, was duidelik in finansieele terme. Die gebruik van optimale steekproef spasieering en grootte het 'n positiewe impak op NHW. Die metode wat gedemonstreer word in hierdie studie kan gebruik word as 'n gids om optimale parameters te selekteer wanneer eksplorasie programme beplan word vir mariene diamantontginnings projekte. Copyright / Dissertation (MSc)--University of Pretoria, 2012. / Geology / unrestricted

The diploma thesis is focused on evaluation of the economic efficiency of investment projects of transport infrastructure in the Czech Republic. These projekcts are evaluated according to the methodological documents of the Ministry of Transport of the Czech Republic, the State Fund for Transport Infrastructure and thr Directorate of Roads and Motorways of the Czech Republic. The diploma thesis also deals with the comparison od individual methodological procedures and their influence on the resulting indicators of economic efficiency of transport infrastructure condtructions.

This diploma thesis deals with the evaluation of economic efficiency of investment projects in transport infrastructure in the Czech Republic. The evaluation of road and motorway infrastructure projects is carried out according to the methodological documents of the Ministry of Transport, the State Fund for Transport Infrastructure and the Road and Motorway Directorate of the Czech Republic. As changes in methodological procedures have taken place in recent years, the diploma thesis deals with the resulting values of economic efficiency indicators, especially with net present value. The thesis analyzes the basic calculation formula for the evaluation of road and motorway infrastructure, which is an integral part of the evaluation of road projects. There are also described fundamental methodological changes regarding, for example, the calculation of the residual value of the project at the end of the reference period or the change in the discount rate. The changes are applied to a case study of a specific section of the Czech transport industry. It evaluates their impact on the final value of the critical indicator of economic efficiency, which is the net present value.

The aim of the thesis is the determination of investment cash flows generated from Finnish market development activities of a selected Russia-based small company, performing investment valuation using discounted cash flow method and presenting improvements which can rise the attractiveness for potential investors. It includes comprehensive investment valuation of the selected company at the seed stage of its` development, including the overview of current financial situation, usage a valuation model followed by stable growth and terminal value determination. Provided and copulated data serves as an example of complete valuation model for capital injections of future projects in the company, thanks to which the author is able to come to particular conclusions on the funding perspectives for the company. The results obtained through the analysis is assessed through the critical prism to be used as a basis for further suggestions on improvement.

Energy communities are formed to create integrated regional energy market in EU and non- EU neighboring countries. It attracts investors in generation and energy networks as it comes up with new stable regulations, so that it will ensure the supply is stable and continuous. Five EU countries (Germany, Italy, Sweden, Greece, Austria) with different policies are selected and simulations are done. Economic analysis for the 5 countries is done based on simulation results. The selected 5 EU countries shows a good economic result; therefore, it can be recommended to implement energy communities and cities by developing the directives. By transposition of policies of the energy community and implementing more subsidies or incentive will make a better contribution for the citizen partnership for creating CEC.

Bakgrund: Betydelsen av investeringsbedömningen kan inte överbetonas till följd av dess långsiktiga fördelar för företagets giltighet och operativa funktionalitet. Beräkningsmetoder som används för investeringsbedömning bistår med nödvändig kunskap för att underlätta beslutsfattande samt för att skapa sig en tydligare bild över det föreslagna investeringsprojektet. Företag investerar för att upprätthålla sina ekonomiska mål och värderingen av olika investeringsalternativ spelar således en central roll för företagets ekonomiska fortlevnad och utveckling. Kapitalinvesteringar är ofta omfattande och förväntas generera värde på lång sikt, vilket formar företagets ekonomiska fokusområden. Detta belyser viktigheten av en kvalitativ bedömning för olika investeringsalternativ och deras respektive utvecklingsmöjligheter. Syfte: Genom att undersöka användningsområdet för kalkylräntan avser studien att öka kunskapen för sambandet mellan kalkylräntebestämningen och investeringsbedömningen. Detta som ett delsyfte till att undersöka vilka metoder som några svenska industri- och fastighetsföretag använder. Studien avser även vidare att beskriva och analysera företagens investeringskalkylering och kapitalstruktur. Metod: Studien har antagit en kvalitativ forskningsansats med semistrukturerade intervjuer med svenska industri- och fastighetsbolag. Respondenterna valdes ut genom ett målstyrt urval och vidare beskriver metoden hur insamling av det empiriska materialet har gått till. För att besvara studiens problemformulering har det empiriska materialet analyserats med den teoretiska referensramen. Slutsats: Studiens resultat visar tydliga skillnader i relation till den klassiska kapitalteorin och att långsiktiga strategiska investeringar i viss utsträckning tenderar att inkräkta på investeringar som kan generera en högre internränta och således vara mer ekonomiskt lönsam, men som är av mindre strategisk betydelse för bolaget. Detta strider mot teorins förutsättningar om att uppnå en normativt optimal kapitalstruktur. En viktig aspekt av det är att företagen försöker bibehålla en helhetlig bild av investeringarna där förutsättningar för nyutveckling ska uppmärksammas, vilket i regel inte strider mot kapitalteorins antaganden. Men i relation till det kan dock investeringskalkyler endast förse bolag med en begränsa uppfattning av investeringens ekonomiska konsekvenser. / Background: The importance of the investment appraisal cannot be overemphasized as a result of its long-term benefits to the company's validity and operational functionality. Calculation methods used for investment assessment assist with the necessary knowledge to facilitate decision-making, as well as to create a clearer picture of the proposed investment project. Companies invest to maintain their financial goals and the valuation of different investment alternatives thus plays a central role for the company's financial survival and development. Capital investments are often extensive and expected to generate value over the long term, shaping the company's financial focus areas. This highlights the importance of a qualitative assessment for different investment options and their respective development opportunities. Purpose: By examining the area of use for the discount rate, the study intends to increase knowledge of the connection between the discount rate determination and the investment assessment. This as a partial aim to investigate which methods some Swedish industrial and real estate companies use. The study also intends to describe and analyze the companies' investment calculation and capital structure Method: The study has adopted a qualitative research approach with semi-structured interviews with Swedish industrial and property companies. The respondents were selected through a targeted selection and the method further describes the collection of the empirical material. In order to answer the study's problem formulation, the empirical material has been analyzed with the theoretical frame of reference. Conclusion: The results of the study show clear differences in relation to the classic capital theory and that long-term strategic investments to a certain extent tend to encroach on investments that can generate a higher internal rate of return and thus be more financially profitable, but which are of less strategic importance for the company. This goes against the theory's prerequisites for achieving a normatively optimal capital structure. An important aspect of it is that the companies try to maintain a holistic view of the investments where the conditions for new development must be noticed, which as a rule does not contradict the assumptions of the capital theory. However, in relation to that, investment calculations can only provide companies with a limited idea of the financial consequences of the investment.

The design of hydropower projects requires a comprehensive planning process in order to achieve the objective to maximise exploitation of the existing hydropower potential as well as future revenues of the plant. For this purpose and to satisfy approval requirements for a complex hydropower development, it is imperative at planning stage, that the conceptual development contemplates a wide range of influencing design factors and ensures appropriate consideration of all related aspects. Since the majority of technical and economical parameters that are required for detailed and final design cannot be precisely determined at early planning stages, crucial design parameters such as design discharge and hydraulic head have to be examined through an extensive optimisation process. One disadvantage inherent to commonly used deterministic analysis is the lack of objectivity for the selection of input parameters. Moreover, it cannot be ensured that the entire existing parameter ranges and all possible parameter combinations are covered. Probabilistic methods utilise discrete probability distributions or parameter input ranges to cover the entire range of uncertainties resulting from an information deficit during the planning phase and integrate them into the optimisation by means of an alternative calculation method. The investigated method assists with the mathematical assessment and integration of uncertainties into the rational economic appraisal of complex infrastructure projects. The assessment includes an exemplary verification to what extent the Random Set Theory can be utilised for the determination of input parameters that are relevant for the optimisation of hydropower projects and evaluates possible improvements with respect to accuracy and suitability of the calculated results. / Die Auslegung von Wasserkraftanlagen stellt einen komplexen Planungsablauf dar, mit dem Ziel das vorhandene Wasserkraftpotential möglichst vollständig zu nutzen und künftige, wirtschaftliche Erträge der Kraftanlage zu maximieren. Um dies zu erreichen und gleichzeitig die Genehmigungsfähigkeit eines komplexen Wasserkraftprojektes zu gewährleisten, besteht hierbei die zwingende Notwendigkeit eine Vielzahl für die Konzepterstellung relevanter Einflussfaktoren zu erfassen und in der Projektplanungsphase hinreichend zu berücksichtigen. In frühen Planungsstadien kann ein Großteil der für die Detailplanung entscheidenden, technischen und wirtschaftlichen Parameter meist nicht exakt bestimmt werden, wodurch maßgebende Designparameter der Wasserkraftanlage, wie Durchfluss und Fallhöhe, einen umfangreichen Optimierungsprozess durchlaufen müssen. Ein Nachteil gebräuchlicher, deterministischer Berechnungsansätze besteht in der zumeist unzureichenden Objektivität bei der Bestimmung der Eingangsparameter, sowie der Tatsache, dass die Erfassung der Parameter in ihrer gesamten Streubreite und sämtlichen, maßgeblichen Parameterkombinationen nicht sichergestellt werden kann. Probabilistische Verfahren verwenden Eingangsparameter in ihrer statistischen Verteilung bzw. in Form von Bandbreiten, mit dem Ziel, Unsicherheiten, die sich aus dem in der Planungsphase unausweichlichen Informationsdefizit ergeben, durch Anwendung einer alternativen Berechnungsmethode mathematisch zu erfassen und in die Berechnung einzubeziehen. Die untersuchte Vorgehensweise trägt dazu bei, aus einem Informationsdefizit resultierende Unschärfen bei der wirtschaftlichen Beurteilung komplexer Infrastrukturprojekte objektiv bzw. mathematisch zu erfassen und in den Planungsprozess einzubeziehen. Es erfolgt eine Beurteilung und beispielhafte Überprüfung, inwiefern die Random Set Methode bei Bestimmung der für den Optimierungsprozess von Wasserkraftanlagen relevanten Eingangsgrößen Anwendung finden kann und in wieweit sich hieraus Verbesserungen hinsichtlich Genauigkeit und Aussagekraft der Berechnungsergebnisse ergeben.

This doctoral thesis focuses on the evaluation of the World Bank (WB) performance in delivering development aid to the Least Developed Countries (LDCs). For this purpose, an extensive research was performed to analyze a set of 790 Implementation Completion and Results reports for key economic and financial indicators. Results of this research provide various insights for the appraisal and the results stage of project delivery of the LDCs in different continents. In the final part of the economic and financial analysis the minimum Social Return on Investment (SROI) of the LDCs including all project costs was calculated. This SROI ratio outcome of 1 and 1.06 in the weighted and 1.3 and 1.72 in the unweighted case indicate that projects delivered by the WB have a positive effect on the poor countries. In the second part of this research project the data set of the ICR reports was qualitatively researched for negative ratings according to 3 core assessment categories for the overall project performance: Sustainability, bank performance and borrower performance. As a result the most critical categories respectively risks were outlined. In conclusion, the research analyses and findings support the general demand to provide even more development assistance to poor countries.:Table of Tables and Figures List of Equations List of Abbreviations 1 Introduction 1.1 Introduction to the Topic 1.2 Assessing Poverty Problems and Achieving Economic Growth 1.3 Millennium Development Goals 1.4 Development Aid 2 Research Approach 2.1 Objective 2.2 Structure 2.3 Least Developed Countries 2.4 World Bank 2.5 Data Access and Relevance 2.5.1 Data Basis 2.5.2 Implementation Completion and Results Reports 2.5.3 Project Types 2.6 Term “Performance” 2.7 Study and Research Questions 2.8 Challenges of this Doctoral Thesis 2.9 Contribution of this Thesis 3 Economic and Financial Analysis 3.1 SROI Concept 3.1.1 SROI Definition 3.1.2 SROI Process and Impact Map 3.1.3 Cost-Benefit-Analysis 3.1.4 SROI Calculation 3.2 SROI of World Bank Projects 3.2.1 Purpose of the Cost-Benefit-Analysis 3.2.2 Indicators of the SROI Calculation 3.2.2.1 Net Present Value 3.2.2.2 Capital and Recurring Costs 3.2.2.3 Project Dates and Duration 3.2.2.4 NPV-horizon 3.2.2.5 Discount Rate 3.2.3 Types of NPV-Cost-Ratios 3.2.3.1 Pro-Rata-Capital-Costs Ratio 3.2.3.2 Total-Capital-Costs Ratio 3.2.3.3 Pro-Rata-Capital plus Recurring-Costs Ratio 3.2.3.4 Total-Capital plus Recurring-Costs Ratio 3.2.4 Calculation of the proper SROI Ratio 3.2.5 Portfolio Analysis 3.2.6 Sensitivity Analysis 3.3 Additional Economic and Financial Indicators 3.3.1 Economic Rate of Return 3.3.2 Benefit-Cost-Ratio 3.3.3 Net Benefit 3.3.4 Financial Net Present Value 3.3.5 Financial Rate of Return 4 Results of the Economic and Financial Analysis 4.1 Analysis Approach and Setup 4.2 NPV Outcomes at the Appraisal Stage 4.2.1 Appraisal NPVs of the LDCs 4.2.2 Appraisal NPV Continent Comparison 4.3 NPV Outcomes of the Result Stage 4.3.1 Result NPVs of the LDCs 4.3.2 Result NPV Continent Comparison 4.4 Appraisal vs. Result NPVs 4.4.1 Results of the LDCs 4.4.2 Continent Comparison 4.5 Economic Rate of Return Result Values 4.5.1 Results of the LDCs 4.5.2 Continent Comparison 4.6 Additional Economic and Financial Indicator Result Values 4.6.1 Benefit-Cost-Ratio and Net Benefit 4.6.2 Financial Net Present Value and Financial Rate of Return 4.7 Overall Project Performance 4.7.1 Definition 4.7.2 Overall Project Performance Ratings 4.7.3 Outcome Calculation for Non-Financial Indicator Projects 4.7.4 Verification of Outcomes and Conclusion 4.8 NPV-Cost-Ratios and SROI Calculation 4.8.1 NPV-Cost-Ratios of the ICR Reports 4.8.1.1 Overall Results 4.8.1.2 Continent Comparison 4.8.2 Standardized NPV-Cost-Ratios 4.8.2.1 Overall Results 4.8.2.2 Continent Comparison 4.8.3 Calculating the Minimum SROI Ratio 4.8.3.1 Overall Results of the Capital SROI Ratio 4.8.3.2 Continental Comparison of the Capital SROI Ratio 4.8.3.3 Overall Results of the Minimum SROI Ratio 4.8.3.4 Continental Comparison of the Minimum SROI Ratio 4.8.4 Making Meaning of the Results 4.9 Summary and Conclusion 5 Qualitative Data Analysis 5.1 Content Analysis 5.2 Sustainability 5.2.1 Sustainability Rating Definition 5.2.2 Sustainability Rating Categories 5.3 Bank Performance 5.3.1 Bank Performance Definition 5.3.2 Bank Performance Categories 5.4 Borrower Performance 5.4.1 Borrower Performance Definition 5.4.2 Borrower Performance Categories 6 Results of the Qualitative Data Analysis 6.1 Sustainability 6.1.1 Quantitative Assessment of Sustainability Ratings 6.1.2 Outcome of the Content Analysis 6.1.2.1 Types of Reasons 6.1.2.2 Overall Results 6.1.2.3 Results in Haiti 6.1.2.4 Continent Comparison 6.1.3 Excursus: Positive NPV Projects 6.1.4 Summary and Conclusion 6.2 Bank Performance 6.2.1 Quantitative Assessment of Bank Performance Ratings 6.2.2 Outcome of the Content Analysis 6.2.2.1 Types of Reasons 6.2.2.2 Overall Results 6.2.2.3 Results in Haiti 6.2.2.4 Continent Comparison 6.2.3 Summary and Conclusion 6.3 Borrower Performance 6.3.1 Quantitative Assessment of Borrower Performance Ratings 6.3.2 Outcome of the Content Analysis 6.3.2.1 Types of Reasons 6.3.2.2 Overall Results 6.3.2.3 Results in Haiti 6.3.2.4 Continent Comparison 6.3.3 Summary and Conclusion 7 Overall Summary and Conclusion 8 Critical Acclaim and Recommendations 9 Outlook and Future Research List of Appendices Appendix References