4.  Financial Appraisal35

(agency perspective) – including but not limited to:

•  costs – capital, operating, maintenance; provision for contingencies

•  data sources, references for assumptions (e.g., CPI, building price index, wage increases; internal rate of return/hurdle rate; assumed Government contribution if any; and so on)

•  financial impacts, including the retiring of older assets and associated operating and maintenance savings

•  any third party revenues, source for revenue assumptions (e.g., for a road project, could include basis for traffic forecasts and alternative tolling regimes)

•  justification for assumed discount rate.





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35   Refer to NSW Government:  Financial Appraisal  (TPP No.97-4, July 1997) on the Treasury website:   http://www.treasury.nsw.gov.au .