Capital budgeting is a key strategic process that ensures capital is deployed to only those opportunities that have a high probability of meeting or exceeding the expectations for return. It is also a process that ensures that scarce capital resources are deployed to the highest yield opportunities across the organization. This course covers how to establish a capital budgeting process from conducting due diligence to communicating and facilitating discussions of capital investment opportunities with decision makers.
In this capital budgeting course, we walk through how to develop assumptions, prepare the capital budgeting analysis, and quantify risk using tornado charts and monte-carlo simulation analysis. We also discuss the financing implications of capital investment opportunities by looking at lease versus buy analysis, a related but often confused part of capital budgeting.
Who this course is for:
Anyone interested in finance or related fields.
- Previous experience in finance
- Discover how to prepare a capital budgeting analysis.
- Discover how to identify and calculate the appropriate discount rate for capital budgeting analysis.
- Discover how to prepare a decision package for a capital budgeting decision including a quantification of risk.
- Identify assumptions that explore and document the range of potential outcomes.
- Discover how to prepare lease versus buy analysis.