Capital Investment Analysis Request Form Tool

Description
This Capital Investment Analysis Request Form is used to evaluate the merits of capital projects. It provides you with a common template that can be easily amended to reflect your capital spending policy.

In addition to being easy to fit into your specific capital spending policies it standardizes investment analysis so the same financial hurdles are measured for each project.

The Purpose and Form of the Capital Investment Analysis Request
The purpose of the CIAR form is to describe the key attributes of a proposed capital project, including:

1. A description of the project, its strategic or tactical objective(s) and critical risk factors
2. The capital investment required for the project
3. Income or reduced costs due to the investment - (A summary of expected volume, gross margins, other income or cost savings)
4. Ongoing operating costs related to the project
5. Earnings and cash flow
6. If appropriate, the terminal value of the investment
7. Financial valuation measures, including
a. Payback in years: Time it takes to recover the cash invested in the project
b. Net Present Value: Expected cash flows discounted at the companies weighted average
cost of capital (Includes Terminal Value)
c. Internal Rate of Return: Investment return rate is based on the cash flows of years 1-5.
(Excludes Terminal Value)

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