1.Prepare a spreadsheet clearly showing the discounted cash flow for each year. The calculations must include the NPV, IRR and the Payback Period of the project. Scenario & Sensitivity analysis should be utilized, to fully justify your recommendations & decision. You should also demonstrate the WACC for the company, as well as each cost of capital/security, and the capital structure of the company. Spreadsheet presentation and functionality will also be graded (refer to the marking guide rubric).
2. Typed business report (approx. 2000 words) making a recommendation whether to accept or reject the project, in regards of the financial analysis you have conducted above. Include ALL scenarios is the report. The executive summary must contain concise reasons for your recommendation and a summary of your financial analysis. Your report must also contain a strong conclusion to justify your analysis of the project. All supporting sections of the report such as the contents page, reference list and appendices are in addition to the report. Students are advised to attach all relevant spreadsheets, charts and any other research or statistics etc. as appendices.
Each group is allowed a maximum of 10 minutes to present their recommendation to the Board. All group members must participate to achieve maximum marks.
The presentation must be engaging rather than just a delivery of facts and information. Be creative but effective.
Your group marks will be awarded based on the following criteria (reasonable assumptions can be made for some of the criteria listed below):
1.Your group’s ability to explain theoretical models used, e.g. NPV, IRR, WACC, scenario & sensitivity analysis of cash flows & the assumptions made when using this analysis etc. In a straightforward and compelling language to meet the needs of the organisation.
2.Demonstrate that the group has considered various scenarios (as above) and the challenges the group underwent to arrive at the conclusion and recommendations. (advantages & disadvantages of your analysis). EG. Challenges could include group dynamic (or consensus) issues, a member playing the ‘devil’s advocate’, or testing the validity of the final result; or any other factors.
3.Consideration of broader business factors, the opportunities & threats analysis of the project; as well as the general emission reduction targets and the environment. Identify any political issues that the company may face in pursuing this project and explain how management plan to address such issues.
4.The overall group participation and performance (including smooth transitions between speakers and minimal glitches, the emphasis of key factors, clear explanations etc.) The audience are provided opportunities to ask questions.
Due to the time constraints, we will limit the number of questions asked to two. The questioning session does not form part of the 10 minute time limit and no penalties will apply. Students should keep the questioning session to five minutes. The teacher will have the discretion to not proceed with the questioning session beyond the five-minute limit.