Financial evaluation of projects
Introduction
Project Formulation and Evaluation is the general procedure to collect, create and systematize information that allows identifying business ideas and quantitatively measuring the costs and benefits of an eventual venture.
.[1].
Project Formulation and Evaluation is an interdisciplinary subject, since disciplines such as statistics, market research, operations research, project engineering, accounting in various aspects (whether costs, balance sheet, income statement, etc.), plant distribution, finance, economic engineering and others intervene during the preparation of a study of this type.[2]
Formalization of the discipline
The discipline of Project Formulation and Evaluation was formalized from the Economic Development Project Manual, published by the United Nations in 1958.[1][5].
The problem to be solved
In any type of company, the financial management of managers is characterized by the permanent search for mechanisms that enable the creation and maintenance of value, through the efficient allocation and use of resources.
Project evaluation, in this context, should be understood as a model that facilitates the understanding of the simplified behavior of reality, so the results obtained, although useful in the decision-making process, are not exact.[6].
References
- [1] ↑ a b Sapag Chain, Nassir (2011). Proyectos de inversión. Formulación y evaluación Segunda Edición. Chile: Pearson Educación. p. 17. ISBN 978-956-343-107-0.
- [2] ↑ Baca Urbina, Gabriel (2001). Evaluación de proyectos, cuarta edición. McGraw-Hill. p. XIII. ISBN 970-10-3001-X.
- [3] ↑ Gray, Clifford F.; Larson, Erik (2003). «Ch. 1. Modern Project Management». Project Management - The Managerial Process. McGraw-Hill Higher Education. p. 5. ISBN 0-07-119523-8.
- [4] ↑ Baca Urbina, Gabriel. Evaluación de proyectos, séptima edición. McGraw-Hill. p. 2. ISBN 978-607-15-0922-2.
- [5] ↑ Naciones Unidas (1958). «Manual de Proyectos de Desarrollo Económico». Consultado el 12 de febrero de 2016.: http://archivo.cepal.org/pdfs/1958/S5828031.pdf
- [6] ↑ Sapag Chain, Nassir (2011). Proyectos de inversión. Formulación y evaluación, Segunda Edición. Pearson Educación. p. 18. ISBN 978-956-343-107-0.