Page 88 - 5.2 i. Manac Finance ITC Summarised Notes
P. 88
CAPITAL INVESTMENT APPRAISAL
Post-investment audit
• It is important that firms compare actual results with the
estimated cash flows used in the capital budgets of projects
and provide explanations for the differences. The main
objective of a post-investment audit is to improve the
capital budgeting process.
• A post-investment audit is useful to:
• monitor and improve the performance of projects subsequent to
implementation;
• ensure that management work hard to achieve forecasts;
• provide valuable lessons for decision-making when it is time to
evaluate further investments.
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