Financial Analysis

NPV Concepts – Project Analysis and Risk Adjustments

Core References

Restructuring and Managing the Enterprise in Transition
Washington, D.C.: The World Bank, 1998, Chapters 1 and 9.
Crum, Roy L., and Itzhak Goldberg

Focuses on transitioning economies. Explains time value of money and calculating rate of return, including adjusting for inflation, risk, and multiple periods (present value calculations. Defines risk. Examines project analysis, including sensitivity and scenario analysis, internal rate of return, discount rates, and risk.

Resetting Price Controls for Privatized Utilities: A Manual for Regulators
Washington, D.C.: World Bank, 1999, Chapter 5.
Green, Richard, and Martin Rodriguez Pardina

Describes net present value analysis in a regulatory context for conducting a price review.

Managerial Economics
London: Norton & Co., 2002, Appendix A.
Mansfield, Edwin, W. Bruce Allen, Neil A. Doherty, and Keith Weigelt

Considers issues of time value of money, calculating rate of return, and risk.

Key Words

Cash flow, Risk, Rate of return, Present Value, Net Present Value, Inflation


Ratio Analysis

Accounting for Infrastructure Regulation: An Introduction
Washington, D.C.: The World Bank, 2008, Annex 1.
Rodriguez Pardina, Martin, Richard Schlirf Rapti, and Eric Groom

Reviews ratios to analyze liquidity, activity, capital structure, and profitability.

Key Words

Ratio Analysis, Liquidity, Capital Structure, Profit