Investment Appraisal Template (NPV, IRR, MIRR, Payback)

Options, incremental cash flows, assumptions, WACC and hurdle, NPV, IRR, MIRR, payback, PI (KaTeX), sensitivity, switching values, scenarios

財務・投資・会計フルGreen Book 2026 (UK public sector); OMB Circular A-94 (1992, reinstated 2025)investment appraisal math更新 2026/10/24

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使い方: Use it to give the financial evidence for a capital project before a capex request or business case decision. Fill the options, conventions and assumptions register first, then the discount rate and the year-by-year cash flow table. The main pitfall is ranking mutually exclusive options by IRR or PI instead of NPV, or discounting cash flows that already deduct interest.

プレビュー

Investment Appraisal: [Project name]

Financial appraisal of a capital investment for a private-sector organisation: decision and options, incremental cash flows, assumptions register, discount rate (WACC and project hurdle), net present value (NPV), internal rate of return (IRR), modified IRR (MIRR), simple and discounted payback, profitability index (PI), sensitivity, switching values, scenarios, real options and the recommendation. Written as original practice guidance using standard corporate finance methods; public-sector appraisals in the UK follow the HM Treasury Green Book (2026 edition, updated 2026-02-05) and US federal analyses follow OMB Circular A-94 (the 1992 version, reinstated on 2025-04-08). Replace every [bracketed] value and every row marked Example. This is a document format, not financial, investment, tax, legal or accounting advice.

Document control

Field	Value
Document ID	[APR-YYYY-NNN] Example: APR-2027-002
Project name and capex ID	[Name, capex register ID] Example: Leipzig warehouse automation, CAP-002
Sponsoring entity and business unit	[Legal entity / segment] Example: Corvid Commerce GmbH (Germany), Fulfilment
Appraisal date (valuation date, year 0)	YYYY-MM-DD Example: 2027-03-15, year 0 = FY2027
Currency, units and price basis	[EUR thousand, nominal]
Appraisal horizon	[Years and reason] Example: 8 years, economic life of the sortation equipment
Discount rate used	[Rate and source] Example: 9.0% nominal after tax (group WACC 8.0% plus 1.0 point category premium)
Version	[0.1]
Status	[Draft / In review / Approved / Superseded]
Owner	[@project-sponsor]
Prepared by	[@fpa-analyst]
Approvers/reviewers	[@cfo], [@head-of-fpa], [@group-treasurer], [@tax-lead]
Last updated	YYYY-MM-DD
Classification	[Confidential: management and board]
Model file	[Path, version and checksum of the appraisal model]
Related documents	Capex Request [CXR-ID], Business Case [ID], Feasibility Study [ID]

Approvals

Role	Name	Decision	Date
Project sponsor	[@name]	[Submit]	YYYY-MM-DD
Head of FP&A (model review)	[@name]	[Reviewed / Returned]	YYYY-MM-DD
Group tax (tax assumptions)	[@name]	[Reviewed / Returned]	YYYY-MM-DD
Chief Financial Officer	[@name]	[Endorse / Return]	YYYY-MM-DD

Revision history

Version	Date	Author	Change summary
0.1	YYYY-MM-DD	[@name]	First draft: options and baseline
0.5	YYYY-MM-DD	[@name]	Example: Supplier quotes received, capex updated to EUR 2,800k
1.0	YYYY-MM-DD	[@name]	Example: Reviewed by FP&A and tax, attached to capex request CXR-2027-002

Decision summary and recommendation
Decision context and options
Cash flow scope and conventions
Assumptions register
Discount rate
Cash flow forecast
Appraisal metrics
Sensitivity, switching values and scenarios
Risks, real options and non-financial factors
Option comparison
Benefits baseline and tracking
Model reference and checks
Glossary and references

1. Decision summary and recommendation

Decision requested: [Approve / Reject / Defer] investment of [currency amount] in [project], to be authorised through capex request [CXR-ID].

Item	Value	Hurdle or comparison
Preferred option	Example: Option A, full automation (conveyors, sortation, pick-to-light)	Highest NPV of the mutually exclusive options
Initial investment (year 0)	Example: EUR 2,900k (capex 2,800 plus spare-parts inventory 100)	Within FY2027 capex envelope line CAP-002
NPV at 9.0%	Example: EUR 437.2k	Greater than zero
IRR	Example: 12.66%	Above 9.0% hurdle
MIRR (reinvestment at 9.0%)	Example: 10.93%	Above 9.0% hurdle
Payback / discounted payback	Example: 5.08 years / 6.96 years	Group guideline: discounted payback within economic life
Profitability index	Example: 1.151	Greater than 1.0
Switching values	Example: NPV reaches zero if savings fall 16.5% or capex rises 19.7%	Compare with forecast error of similar projects
Probability-weighted NPV	Example: EUR 324.2k (scenarios in section 8.3)	Greater than zero

Recommendation (Example): approve Option A. It has the highest NPV, it clears the hurdle in the base and upside cases, and the downside case (capex 10% over and savings 20% short) gives a negative NPV of EUR 315.3k. The decision therefore rests on the labour-saving assumption (ASM-004), which is supported by a time-and-motion study and two reference sites. Make release of the final 10% payment conditional on site acceptance and 30 days of stable operation (CON-001 in Capex Request (finance/capex-request)).

2. Decision context and options

2.1 Problem and objective

Describe the problem in operational terms, with numbers from the current state. Example: the Leipzig fulfilment centre ships about 1.1 million orders a year (FY2026, the whole of Corvid's commerce volume; the FY2027 budget assumes 1.2 million) with manual picking. Peak-season overtime and agency staff raise the cost per order by about a third in Q4, and the mispick rate is above the service target. The objective is to cut the cost per order and hold peak capacity without adding floor space.

Link to the strategic priority this supports. Example: PRI-004 "Automate fulfilment" in the FY2027 budget.

2.2 Options

Option ID	Description	Treatment	Reason
OPT-0 (Example)	Do nothing: manual picking, agency staff at peak	Baseline	All other options are measured as increments against this
OPT-A (Example)	Full automation: conveyors, automated sortation, pick-to-light, warehouse control software	Appraised	Preferred
OPT-B (Example)	Partial automation: sortation only, manual picking retained	Appraised	Lower capital, lower savings
OPT-C (Example)	Outsource peak volume to a third-party logistics provider	Rejected at long list	Service-level risk and loss of same-day cut-off; quote did not beat OPT-0 in peak
OPT-D (Example)	Relocate to a new automated site	Rejected at long list	Lease commitment and timing outside the planning horizon

Leasing the equipment is a financing choice, not an investment option: decide first whether the asset is worth having (this appraisal), then compare lease and purchase at the after-tax cost of borrowing in a separate lease-versus-buy analysis.

2.3 Mutually exclusive or independent

State whether options are mutually exclusive (only one can be chosen) or independent. For mutually exclusive options, rank by NPV, not by IRR or PI (see section 10). For independent projects competing for a fixed capital budget, rank by PI within the budget and confirm the combination with the highest total NPV.

3. Cash flow scope and conventions

3.1 Incremental principle

Include only cash flows that change because of the decision, measured against the baseline option:

Include: capital expenditure, installation and commissioning, changes in operating costs and revenues, changes in working capital, tax effects (including tax relief on depreciation), residual or disposal value, decommissioning costs, opportunity costs of assets the project uses that could otherwise be sold or used elsewhere.
Exclude: sunk costs (feasibility work already paid), allocated overheads that do not change, accounting depreciation as such (only its tax effect is a cash flow), and financing flows (interest and principal), because the discount rate already prices the cost of finance.
Treat carefully: cannibalisation of existing revenue, savings that are only "capacity freed" unless the capacity is actually removed or reused, and one-off implementation operating costs (training, process redesign), which are cash costs even though they are expensed.

3.2 Conventions used

Convention	Choice	Example
Price basis	[Nominal / Real]	Example: Nominal: savings escalate at about 2% a year, discount rate is nominal
Timing	[End-of-year / mid-year / monthly]	Example: Year 0 outlays at the valuation date; operating flows at year end
Tax	[Rate, timing, loss use]	Example: 30% combined rate, paid in the year the profit arises; tax losses relieved within the German tax group
Tax depreciation	[Method and life]	Example: Straight line over 8 years, EUR 350k a year from year 1
Currency	[Functional currency, FX source]	Example: EUR; no foreign-currency flows (supplier quote fixed in EUR)
Residual value	[Method]	Example: Disposal value EUR 150k in year 8, fully taxable because tax book value is nil
Working capital	[Items]	Example: Spare-parts inventory EUR 100k at year 0, released in year 8
Inflation	[Index and rate]	Example: 2.0% a year on labour and maintenance, from the group planning assumptions

Keep the cash flows and the discount rate consistent: nominal flows with a nominal rate, real flows with a real rate, pre-tax flows with a pre-tax rate. Convert a rate between nominal and real with the Fisher relation, not by subtraction, when inflation is material:

(1 + r_{nominal}) = (1 + r_{real}) \times (1 + i)

3.3 Tax, inflation and FX treatment

Record the tax rate by jurisdiction, any investment incentives or grants (and whether they are conditional), and the timing of tax payments. If flows arise in more than one currency, forecast each in its own currency and convert at forward rates or at a consistent parity assumption; do not mix a EUR discount rate with USD flows. Example: no grants assumed; a regional investment grant was explored and excluded because eligibility was not confirmed (ASM-010).

4. Assumptions register

ID	Assumption	Value	Source and evidence	Owner	Confidence
ASM-001 (Example)	Capital cost, equipment and installation	EUR 2,800k including EUR 150k contingency	Two supplier quotes, fixed price to 2027-06-30; see CXR-2027-002 cost breakdown	[@project-manager]	High
ASM-002 (Example)	Spare-parts inventory	EUR 100k at year 0, released year 8	Supplier recommended spares list	[@maintenance-lead]	Medium
ASM-003 (Example)	Go-live date	2028-01-01	Supplier schedule, 30 weeks from order	[@project-manager]	Medium
ASM-004 (Example)	Net pre-tax operating savings	Year 1 EUR 520k (ramp-up), year 2 EUR 680k, then about 2% a year to EUR 766k in year 8	Time-and-motion study, agency invoices FY2026, two reference sites; net of maintenance contract and energy. Cross-check: about 1.17 million orders in FY2029 x the EUR 0.65 fall in cost per order (BEN-002) = about EUR 760k gross, less about EUR 80k of maintenance contract and energy = EUR 680k	[@fulfilment-director]	Medium
ASM-005 (Example)	Combined tax rate	30%, held flat for simplicity	Group tax; check municipal trade tax rate for Leipzig. German corporate income tax is legislated to fall by one point a year from 2028 to 10% in 2032 (as of 2026-10; check the current law and model the enacted rate path, see section 8.1)	[@tax-lead]	Medium
ASM-006 (Example)	Tax depreciation	Straight line, 8 years	Group tax; confirm local depreciation tables. Check whether the optional declining-balance allowance (up to 30% a year) for movable assets acquired before 2028-01-01 applies; if elected, tax relief comes earlier (see section 8.1)	[@tax-lead]	Medium
ASM-007 (Example)	Economic life	8 years	Supplier design life 10 years, shortened for technology risk	[@cto]	Medium
ASM-008 (Example)	Disposal value, year 8	EUR 150k	Supplier buy-back indication	[@procurement]	Low
ASM-009 (Example)	Discount rate	9.0%	Section 5	[@group-treasurer]	High
ASM-010 (Example)	Investment grant	None assumed	Eligibility not confirmed	[@cfo]	n/a

Confidence scale: High = contract, quote or audited data; Medium = study or benchmark; Low = indication or judgement. Run sensitivity on every Medium and Low input.

5. Discount rate

5.1 Cost of equity and WACC

k_e = r_f + \beta \times ERP

WACC = \frac{E}{D+E} \times k_e + \frac{D}{D+E} \times k_d \times (1 - T)

Input	Value (Example)	Source and date
Risk-free rate, r_f	2.65%	[Long-dated EUR government bond yield, date]
Equity beta, beta	1.20	[Peer median, relevered at target leverage]
Equity risk premium, ERP	5.5%	[Group treasury house view, date]
Cost of equity, k_e	9.25%	2.65% + 1.20 x 5.5%
Pre-tax cost of debt, k_d	4.5%	[Marginal borrowing cost under the revolving facility]
Tax rate, T	30%	ASM-005
After-tax cost of debt	3.15%	4.5% x (1 - 0.30)
Target weights E / D	80% / 20%	[Capital structure policy]
WACC	8.03%, rounded to 8.0%	0.80 x 9.25% + 0.20 x 3.15% = 7.40% + 0.63%

5.2 Project hurdle rate

Project category	Premium over WACC	Rationale
Replacement and compliance (Example)	0.0 points	Risk similar to existing operations
Efficiency and cost reduction (Example)	1.0 point	Savings depend on operational change
Growth, new market or product (Example)	3.0 points	Revenue risk above group average

Example: CAP-002 is an efficiency project, so the hurdle is 8.0% + 1.0 = 9.0%. Record who sets the premiums and when they were last reviewed; the premiums are a policy choice, and they belong in the capital allocation policy, not in each appraisal.

For public-sector appraisals use the official discount rate instead: the Green Book social time preference rate in the UK (HM Treasury published an independent discount rate review on 2026-06-30; check whether a new rate has been adopted) and the OMB Circular A-94 rates in the US federal government. Current-year A-94 discount rates are issued by OMB memorandum (for 2026, M-26-09 of 2026-03-06, as reported); check the latest memorandum before use.

6. Cash flow forecast

Discount factor for year t at rate r:

DF_t = \frac{1}{(1 + r)^t}

Year	FY	Capex and working capital	Pre-tax savings	Tax depreciation	Tax at 30%	Net cash flow	DF at 9.0%	Present value	Cumulative cash	Cumulative PV
0 (Example)	2027	(2,900.0)	0.0	0.0	0.0	(2,900.0)	1.0000	(2,900.0)	(2,900.0)	(2,900.0)
1 (Example)	2028	0.0	520.0	350.0	(51.0)	469.0	0.9174	430.3	(2,431.0)	(2,469.7)
2 (Example)	2029	0.0	680.0	350.0	(99.0)	581.0	0.8417	489.0	(1,850.0)	(1,980.7)
3 (Example)	2030	0.0	694.0	350.0	(103.2)	590.8	0.7722	456.2	(1,259.2)	(1,524.5)
4 (Example)	2031	0.0	708.0	350.0	(107.4)	600.6	0.7084	425.5	(658.6)	(1,099.0)
5 (Example)	2032	0.0	722.0	350.0	(111.6)	610.4	0.6499	396.7	(48.2)	(702.3)
6 (Example)	2033	0.0	736.0	350.0	(115.8)	620.2	0.5963	369.8	572.0	(332.5)
7 (Example)	2034	0.0	751.0	350.0	(120.3)	630.7	0.5470	345.0	1,202.7	12.5
8 (Example)	2035	205.0	766.0	350.0	(124.8)	846.2	0.5019	424.7	2,048.9	437.2

Notes on the example:

Tax each year = 30% x (savings - 350). Year 1: 0.30 x (520 - 350) = 51.0.
Year 8 terminal items: disposal value 150 less tax 45 (fully taxable) = 105, plus release of spare-parts inventory 100, so 205 in the capex and working capital column. Year 8 net cash flow = 766 - 124.8 + 205 = 846.2.
Discount factors are shown to four decimals; present values are computed from unrounded factors and agree with the four-decimal factors to within 0.1.

7. Appraisal metrics

7.1 Net present value

NPV = \sum_{t=0}^{N} \frac{CF_t}{(1 + r)^t}

Example: sum of present values of years 1 to 8 = 3,337.2; less initial investment 2,900.0; NPV = EUR 437.2k. A positive NPV means the project is expected to return more than the 9.0% required return, by EUR 437.2k in today's money.

7.2 Internal rate of return

IRR is the rate at which NPV equals zero:

\sum_{t=0}^{N} \frac{CF_t}{(1 + IRR)^t} = 0

Example: IRR = 12.66%, solved iteratively (check: NPV at 12.66% is zero to within EUR 0.1k). IRR is reliable here because the cash flows change sign only once (one outflow, then inflows). Where flows change sign more than once (for example a mid-life overhaul or a decommissioning cost), there can be several IRRs or none: use NPV and MIRR instead.

7.3 Modified internal rate of return

MIRR compounds positive flows forward at a reinvestment rate and discounts negative flows at a finance rate, which removes the multiple-IRR problem and the implied reinvestment at the IRR:

MIRR = \left( \frac{FV(\text{positive flows at } r_{reinvest})}{PV(\text{negative flows at } r_{finance})} \right)^{1/N} - 1

Example: with both rates at 9.0%, the future value of years 1 to 8 inflows at year 8 is EUR 6,649.6k; the present value of outflows is EUR 2,900.0k; MIRR = (6,649.6 / 2,900.0)^(1/8) - 1 = 10.93%.

7.4 Payback and discounted payback

Simple payback is the time until cumulative undiscounted cash flow turns positive; discounted payback uses cumulative present values. Interpolate within the year:

Payback = (t - 1) + \frac{|\text{cumulative at } t-1|}{CF_t}

Example: simple payback = 4 + 658.6 / 610.4 = 5.08 years. Discounted payback = 6 + 332.5 / 345.0 = 6.96 years. Both fall within the 8-year life, but discounted payback is close to the end of life, which signals that value depends on the later years.

7.5 Profitability index

PI = \frac{PV(\text{future cash flows})}{\text{Initial investment}} = 1 + \frac{NPV}{\text{Initial investment}}

Example: PI = 3,337.2 / 2,900.0 = 1.151. Use PI to rank independent projects under a capital constraint, not to choose between mutually exclusive options.

7.6 Metric summary

Metric	Base case (Example)	Decision rule	Main limitation
NPV	EUR 437.2k	Accept if greater than zero; rank exclusive options by NPV	Sensitive to the discount rate and terminal values
IRR	12.66%	Accept if above hurdle	Multiple or no IRR with non-conventional flows; ignores scale
MIRR	10.93%	Accept if above hurdle	Depends on the chosen reinvestment rate
Payback	5.08 years	Within policy limit	Ignores time value and flows after payback
Discounted payback	6.96 years	Within economic life	Ignores flows after payback
PI	1.151	Accept if greater than 1.0	Misleading for exclusive options of different size

8. Sensitivity, switching values and scenarios

8.1 One-at-a-time sensitivity

Input changed	Change	NPV (EUR k) (Example)	IRR (Example)	Change in NPV
Base case	n/a	437.2	12.66%	n/a
Capital cost (ASM-001)	+10%	215.3	10.67%	(221.9)
Capital cost (ASM-001)	-10%	659.1	14.97%	221.9
Operating savings (ASM-004), all years	-10%	171.9	10.46%	(265.3)
Operating savings (ASM-004), all years	+10%	702.5	14.77%	265.3
Operating savings (ASM-004), all years	-20%	(93.4)	8.19%	(530.6)
Tax rate (ASM-005)	33%	379.3	12.19%	(57.9)
Tax rate path (ASM-005), illustrative	Combined rate falls by about 1.05 points a year from 2028 to about 24.7% from 2032	515.3	13.26%	78.1
Tax depreciation (ASM-006), illustrative	Declining balance at 30%, switching to straight line	509.0	13.52%	71.8
Disposal value (ASM-008)	nil	384.5	12.27%	(52.7)
Discount rate (ASM-009)	8.0%	574.3	12.66%	137.1
Discount rate (ASM-009)	10.0%	308.1	12.66%	(129.1)
Discount rate (ASM-009)	11.0%	186.5	12.66%	(250.7)

Capital cost changes also change tax depreciation; the model recalculates both. The two illustrative tax rows apply German measures enacted in 2025 (as of 2026-10; confirm with the tax lead before use): a combined rate of 30% less 1.055 points for each point of corporate income tax cut (the solidarity surcharge moves with it), giving 28.95% in 2028 and 24.73% from 2032, with the disposal taxed at the final-year rate; and declining-balance depreciation of 840, 588, 411.6, 288.1, 201.7 and then 156.9 a year, which sums to 2,800. Both raise NPV, together to about EUR 600.3k (IRR 14.23%). The base case keeps the flat 30% rate and straight-line relief because the recommendation does not depend on them: it is conservative to leave them out.

8.2 Switching values

A switching value is the change in one input, holding all others at base, that brings NPV to zero.

Input	Base	Switching value (Example)	Change from base	Comment
Operating savings	100% of ASM-004	83.5% of ASM-004	-16.5%	Reference sites achieved 90% to 105% of plan
Capital cost	EUR 2,800k	EUR 3,352k	+19.7%	Fixed-price quote; contingency already included
Discount rate	9.0%	12.66% (the IRR)	+3.66 points	Well above any plausible hurdle change

8.3 Scenarios

Scenario	Definition (Example)	NPV (EUR k)	IRR	Weight	Weighted NPV
Downside	Capex +10%, savings -20%	(315.3)	6.45%	25%	(78.8)
Base	All assumptions at register values	437.2	12.66%	50%	218.6
Upside	Savings +10%, disposal value EUR 250k	737.6	15.00%	25%	184.4
Probability-weighted				100%	324.2

Scenario weights are a judgement; record who set them. A positive probability-weighted NPV with a negative downside means the project is worth doing if the organisation can absorb the downside loss; say so explicitly.

9. Risks, real options and non-financial factors

9.1 Risk register extract

Risk ID	Risk	Effect on appraisal	Mitigation	Owner
RSK-001 (Example)	Go-live slips one quarter	Year 1 savings fall by about a quarter	Penalty clause for supplier delay; parallel manual run	[@project-manager]
RSK-002 (Example)	Savings ramp-up slower than planned	NPV falls by about EUR 33.4k per 10% shortfall in year 1 savings	Training plan, supplier on site for 8 weeks	[@fulfilment-director]
RSK-003 (Example)	Order volume falls below 0.9 million a year	Labour savings partly lost	Volume covenant in the business case; reassess at stage gate	[@coo]
RSK-004 (Example)	Works council consultation delays changes to shift patterns	Savings start later	Early consultation, redeployment plan	[@hr-director]

Example: the RSK-002 effect is 10% of year 1 savings (EUR 52.0k) after tax at 30% (EUR 36.4k), discounted with the year 1 factor 0.9174, which gives EUR 33.4k. Tax depreciation is unchanged, so only the savings and their tax move. Replace these figures with your model output.

9.2 Real options

Option	Description (Example)	Treatment
Expand	Layout reserves space for a second sortation loop if volume grows above 1.5 million orders a year	Described qualitatively; not included in NPV
Defer	Waiting one year keeps the quote at risk and loses one year of savings	Considered; deferral NPV lower than proceeding
Abandon	Supplier buy-back indication gives a floor value for the equipment	Disposal value shown in ASM-008

Only include option value in the headline NPV when it is valued with a stated method (decision tree or option pricing) and the inputs are evidenced.

9.3 Non-financial factors

List factors that matter to the decision but are not in the NPV: health and safety (less manual lifting), service quality (mispick rate), employee impact and consultation duties, environmental effects (energy use), data and cyber risk of new control software, and dependency on one supplier. State for each whether it supports or weakens the case.

10. Option comparison

Metric (Example)	OPT-A Full automation	OPT-B Sortation only	Increment A minus B
Initial investment (EUR k)	2,900.0	1,550.0	1,350.0
NPV at 9.0% (EUR k)	437.2	262.7	174.5
IRR	12.66%	13.11%	12.14%
MIRR	10.93%	11.15%	n/a
PI	1.151	1.170	n/a
Payback (years)	5.08	4.99	n/a
Discounted payback (years)	6.96	6.81	n/a

Example OPT-B inputs: capex EUR 1,500k, spares EUR 50k, savings EUR 290k in year 1 and EUR 370k in year 2, then EUR 377k, 385k, 393k, 401k, 409k and 417k in years 3 to 8 (about 2% a year, rounded to whole EUR thousand), disposal value EUR 80k, tax depreciation 1,500 / 8 = 187.5 a year, same tax and discount conventions.

OPT-B has the higher IRR and PI, but OPT-A adds EUR 174.5k more value. The incremental investment of EUR 1,350k earns 12.14%, above the 9.0% hurdle, so the extra capital in OPT-A is worth spending. Choose OPT-A unless capital is rationed so tightly that the EUR 1,350k would earn more elsewhere.

11. Benefits baseline and tracking

Benefit ID	Measure	Baseline (date, source)	Target and date	Data source	Owner
BEN-001 (Example)	Net operating savings vs baseline	EUR 0 (FY2026 cost base, agency invoices and payroll)	EUR 680k in FY2029	Cost centre CC-410 actuals	[@fulfilment-director]
BEN-002 (Example)	Cost per order, Leipzig	EUR 4.60 (FY2026 actual)	EUR 3.95 by FY2029	Warehouse management reports	[@fulfilment-director]
BEN-003 (Example)	Mispick rate	0.45% of order lines (FY2026)	0.15% by FY2029	Quality log	[@quality-lead]
BEN-004 (Example)	Peak agency hours	61,000 hours in Q4 2026	Below 15,000 hours in Q4 2028	Agency invoices	[@hr-director]

Hand the register to the capex request (section 8 of Capex Request) and schedule the post-investment review: Example: 18 months after go-live, with a light check at 6 months.

12. Model reference and checks

Item	Value
Model file and version	[Path / version / date]
Model specification	Financial Model Specification (`finance/financial-model-specification`)
Structure	[Inputs sheet, calculation sheet, outputs sheet; one row one calculation]
Review	[@reviewer], YYYY-MM-DD, findings closed [Yes / No]

Checks performed (tick when done):

Year 0 equals the valuation date; no flows before year 0 except sunk costs, which are excluded.
Discount factors recomputed independently for at least three years.
NPV recomputed from the table with a calculator; IRR checked by discounting at the IRR (NPV equals zero).
Tax depreciation totals equal the depreciable cost; working capital released in full.
No interest or loan flows in the cash flows.
Nominal flows with a nominal rate (or real with real).
Every input traced to the assumptions register; no hard-coded numbers in calculations.
Sensitivity and scenario outputs regenerated after the final change.

13. Glossary and references

13.1 Glossary

Term	Meaning in this template
Baseline	The "do nothing" or "do minimum" option against which increments are measured
CAPM	Capital asset pricing model: cost of equity as risk-free rate plus beta times the equity risk premium
Discount factor	Present value of one unit received at the end of year t
Discounted payback	Years until cumulative present value of cash flows turns positive
Hurdle rate	Minimum required return for a project category, here WACC plus a category premium
IRR	Discount rate at which NPV equals zero
MIRR	Return that compounds inflows at a reinvestment rate and discounts outflows at a finance rate
NPV	Sum of discounted incremental cash flows, including the initial investment
PI	Present value of future cash flows divided by the initial investment
Real option	Right, not obligation, to change the project later (expand, defer, abandon)
Switching value	Value of one input at which NPV becomes zero
WACC	Weighted average cost of capital: blended after-tax required return of debt and equity holders

13.2 References

Reference	Version or date checked	Use
HM Treasury, The Green Book (gov.uk, Open Government Licence v3.0)	2026 edition, updated 2026-02-05; checked 2026-10-25	Public-sector appraisal context, option comparison and sensitivity practice, by reference
HM Treasury, Green Book discount rate review 2026 (gov.uk)	Conclusions published 2026-06-30; checked 2026-10-25	Note on public-sector discount rates, by reference
OMB Circular A-94, Guidelines and Discount Rates for Benefit-Cost Analysis of Federal Programs	Version of 1992-10-29, reinstated by OMB Memorandum M-25-23 (2025-04-08), which also kept the 2025 Appendix C rates; annual rates since then by OMB memorandum (2026: M-26-09, as reported; check the latest)	US federal benefit-cost context, by reference
German Act on an immediate tax investment programme (Gesetz für ein steuerliches Investitionssofortprogramm), 2025	As of 2026-10, not re-checked against the Federal Law Gazette; confirm with the tax lead	Corporate income tax rate path from 2028 and declining-balance allowance, used only in the illustrative sensitivity rows
FAST Standard, FAST Standard Organisation	Version 02c (CC BY 4.0)	Model layout discipline, by reference
IFAC, Project and Investment Appraisal for Sustainable Value Creation	2013	Further reading, name only
Capex Request (`finance/capex-request`)	This library	Authority to spend
Post-Investment Review (`finance/post-investment-review`)	This library	Look-back on this appraisal
Business Case (`business/business-case`)	This library	Strategic, commercial and management cases
Feasibility Study (`business/feasibility-study`)	This library	Technical, legal, operational and schedule feasibility
Valuation Report (`finance/valuation-report`)	This library	Valuation of a whole business rather than one project

Standard and licence note

Based on standard corporate finance methods (discounted cash flow, CAPM and WACC) that are not owned by any standard setter, with public-sector context from the HM Treasury Green Book (2026 edition, Crown copyright, Open Government Licence v3.0) and OMB Circular A-94 (US federal work, public domain), both cited by reference only. The FAST Standard (version 02c, CC BY 4.0) and the IFAC appraisal publication are cited by name only; no text from either is reproduced. German tax law is cited by name as public law. Corvid Commerce Group, the project and every figure are fictional. This template is original text written for this collection. Check the current official versions of cited guidance, including the current public-sector discount rates, before use. Template licence: MIT.