Skip to main content

During 2021 we will continue to support students who need to study remotely due to the ongoing impacts of COVID-19 and travel restrictions. Make sure you check the location code when selecting a unit outline or choosing your units of study in Sydney Student. Find out more about what these codes mean. Both remote and on-campus locations have the same learning activities and assessments, however teaching staff may vary. More information about face-to-face teaching and assessment arrangements for each unit will be provided on Canvas.

Unit of study_

CIVL2812: Project Appraisal

This unit aims to introduce students to project valuations using present-value cash flow theory, taxation and probabilities, and the role of these valuations in the decision-making process. Students are taught techniques for making an analysis of issues involved in project appraisal by various methods and these are applied to businesses, non-profit organisations, and governments. At the end of this unit, students should be able to comprehend and relate to real-life examples the fundamental concepts in project appraisal (e. g. the meaning of time value for money, equivalence); calculate common financial indicators for a given project and explain the relevance of each to the appraisal of the project; rank projects by combining both financial and non-financial indicators (e. g. environmental and social); understand how risks and uncertainties affect evaluation outcomes and be able to deal with uncertainties and risks in analysis; apply techniques to account for the effects of inflation/deflation and exchange rates in analysis; understand the concept and mechanisms for depreciation and carry out pre-tax as well as post-tax analysis; understand the assumptions, pros and cons of each evaluation method and be able to explain why a particular method is appropriate/not appropriate for a given project. The syllabus covers the following concepts: time value of money, cost of capital, simple/compound interest, nominal/effective interest, cost/benefit analysis of projects; equivalence, net present worth (value), future worth (value), annual worth (value), internal rate of return, external rate of return, payback period; cost-benefit analysis, cost-utility analysis, identifying and quantifying non-financial benefits/externalities; Other influencing factors: price changes and exchange rates, depreciation, taxation; Capitalisation and valuation studies, replacement of assets, real option, project risk analysis, decision-tree analysis, WACC, MARR, equity capital, debt. This unit of study is a second-year core unit for students enrolled in Civil Engineering (any major), and is a possible elective in other schools of engineering.

Code CIVL2812
Academic unit Civil Engineering
Credit points 6
Prerequisites:
? 
None
Corequisites:
? 
None
Prohibitions:
? 
CIVL3812
Assumed knowledge:
? 
MATH1005

At the completion of this unit, you should be able to:

  • LO1. rank projects by combining both financial and non-financial indicators (e.g. environmental and social)
  • LO2. comprehend and relate to real-life examples the fundamental concepts in project appraisal (e.g. the meaning of time value for money, equivalence)
  • LO3. calculate common financial indicators for a given project and explain the relevance of each to the appraisal of the project
  • LO4. understand how risks and uncertainties affect evaluation outcomes and able to deal with uncertainties and risks in analysis
  • LO5. apply techniques to account for the effects of inflation/deflation and exchange rates in analysis
  • LO6. understand the concept and mechanisms for depreciation and carry out pre-tax as well as post-tax analysis
  • LO7. understand the basic concepts in financing and be able to carry out basic financing analysis
  • LO8. understand the assumptions, pros and cons of each cash flow evaluation method and able to explain why a particular method is appropriate/not appropriate for a given project
  • LO9. understand the challenges of multiattributed decision-making and able to apply an appropriate model to a given project for effective decision making.

Unit outlines

Unit outlines will be available 2 weeks before the first day of teaching for the relevant session.