TRAINING PROGRAMME ON “PROJECT APPRAISAL, RISK ANALYSIS AND RISK MANAGEMENT”

PROJECT APPRAISAL CONSULTANTS will conduct a Training Programme on “Project Appraisal, Risk

Analysis and Risk Management” as mentioned below.

Dates : 02nd February to 06th February 2015 [09:30 AM to 05:00 PM]

Venue : Lecture Room 1 (Annexe) India International Centre, 40 Max Mueller Marg, New Delhi

This training programme will cover financial aspects of project appraisal, quantitive risk analysis and risk man-

agement of projects/investments. Risk Analysis will cover Sensivity Analysis, Scenario Analysis and Monte Carlo

simulation for quantifying risks and management of risk.

Monte Carlo simulation of Project returns (NPV, IRR, BC

Ratio) will be done by using Crystal Ball software.

This training programme will be taught with exercises from

the field and by use of latest project appraisal techniques

as are being taught in the leading universities in the world

over and also accepted by International and National lend-

ing institutions. The participants will be required to do case

excercises on daily basis, on computers by use of Excel,

covering pro-forma cash flow statements, calculation of Net Present Value, Internal Rate of Return, Benefit

Cost Ratio, Sensitivity Analysis and identification of sensitive/risk variables, scenario analysis, quantitative risk

analysis by the use of Monte Carlo simulation [with Crystal Ball software] and explore Risk Management options

available to decision makers. This programme will equip the participants with skills for development of efficient

risk management options and decision making in marginal projects.

This programme has been designed for officers from Indian Administrative Service, Central Civil Services,

State Civil Services, State finance/planning services,

public sector undertakings, Banks, Engineering Depart-

ments, NGO’s, Private organisations Investment Com-

panies/Banks etc., who examine projects/programmes

and propose decision on projects/programmes for their

implmentation as well as for developing risk manage-

ment options. The case excercises will be done with

Excel and the participants would be required to bring

their own laptop computers to the training programme.

TRAINING PROGRAMME ON “PROJECT APPRAISAL, RISK ANALYSIS AND RISK MANAGEMENT”

Financial/economic costs, Real and nominal costs, Revenue, Receipts, expenses, expenditure, Accounts payable, •Accounts Receivable, Accounting concepts – Accrual and Cash forms of Accounting.

Opportunity cost of public funds, different methods to calculate discount rate, Inflating, Deflating, Discounting, Annu-•ity, Compounding, Weighted Average Cost of Capita (WACC). Real and nominal discount rates and discount factors, Real and nominal interest rates.

Pro forma Cash Flow Statements, cash inflows, Net cash flow, (from perspectives of equity holders, lenders, government) •

Al• ternative investment Criteria, Net present Value (NPV), Internal Rate of Return (IRR), Benefit Cost Ratio (BCR) method, Payback period, Cost-Effective method. Which one to use and where?

A• ll six effects of inflation on project viability – Financing project investment, depreciation deductions and tax saving, interest expenses and tax deductions, Cost of Goods Sold [COGS], First In First Out [FIFO] and Last In First Out [LIFO], Loan repayments and the need to have Desired Cash Balance [DCB].

Incremental• /Scale analysis, How to determine optimum Scale/Size of a project. Scale versus NPV, Incremental NPV, IRR and Incremental IRR.

Op• timum time to start a project or close a project. Different cases.

D• ifferences between financial and economic investment analysis. Analysis of financial/economic profiles from alter-nate point of view (owner, banker, state budget and economy).

D• istributive / Social analysis of projects, differentiated distributional weights of costs/benefits for different sections of society.

W• hat is Sensivity analysis? Why and how is it done? Identification of Sensitive and Risk Variables. Usefulness and limitation of Sensivity analysis. Case exercise.

S• cenario analysis. What are worst cases, best case and most expected case scenario. limitations of Scenario analy-sis. Case exercise on scenario analysis.

W• hat is Risk Analysis? Characteristics of probability distributions, different types of Probability distributions, Use of assignments of probability distributions to sensitive project variables, use Monte Carlo simulation to get project return (NPV, IRR/ BC Ratio) distributions, quantifying risks, Interpretation of project output results and variability.

Sel• ection of projects by risk averse and risk lovers. why mode values of inputs do not give best possible project out-puts. Uncertainty and risk, Value of Information and cost of uncertainty, expected value of loss and expected value of gain. Expected loss ratio. Usefulness and limitations of risk analysis in project appraisal.

Ris• k Management - various risk management options such as - do nothing, reduce level protection or regulation level, obtain more information and data about project variables accurately, avoid high impact risks, mitigate risks, contingency planning, create risk reserve, Insurance, risk transfer through contracts, How to evaluate risk manage-ment options ?

Case exercise by use of Crystal Ball software to illustrate the reduction of project return variability. Assigning cor-•relation among different project variables, understanding change in standard deviations and coefficient of variations in project return [NPV and IRR] after assigning correlations among risk variables.

CONTENTS

TRAINING PROGRAMME ON “PROJECT APPRAISAL, RISK ANALYSIS AND RISK MANAGEMENT”

The faculty who will teach this programme have taught in leading Universities such as Harvard University, Duke Uni-versity etc., and have worked at top level positions in the States as well as Central Government in India. The lead faculties for this programme are:

Jarnail Singh is the Chief Executive Officer of Project Appraisal Consultants and is responsible for managing the entire operations of the Programme. He is a Master of Science in Electrical Engineering (Distinction) from Punjab University and Master in Public Administration from Har-vard University (USA). As a member of the Indian Administrative Service, he has held several important positions in India including Secretary to Government of India, Chief Secretary of Manipur State and Joint Secretary to Prime Minister. He has been a Teaching Assistant for “Ap-praisal of Development Expenditure” course for graduate students in the Harvard University. He has also taught in the “Program in Investment Appraisal & Management (PIAM)” conducted by the Harvard Institute for International Development (HIID). While at the Harvard University he was associated with appraising of projects for different countries. He is a recipient of the “Prime Minister’s Award for Excellence in Public Administration” for the year 2007-08.

Dr. D. N. S. Dhakal is a senior fellow at Duke Centre for International Development (DCID), Duke University, USA. He has been working in Executive Programs of DCID on Project Appraisal and Risk Management and Fiscal Decentralization and Local Government since 2001. Dr Dhakal had taught the Program on “Project Investment Appraisal and Management” at Harvard Institute for International Development (HIID), and also teaches now “Economic Appraisal and Stakeholder Analysis for Investment Appraisal” in overseas countries for John Deutsch International Execu-tive Program, Department of Economics, of Queen’s University, Kingston, Ontario, Canada, So-cial Cost Benefit Analysis at IDE Advanced School in Tokyo, Japan. Dr Dhakal is a partner of

Project Appraisal Consultant in Delhi and also serves as a senior economist at Cambridge Resource International, a private international consulting firm based in Cambridge, Massachusetts, USA. Other Faculty Members include experienced civil servants who have studied this area in world class universities.

LUNCH

BREAK

TEA

BREAK

Date & Day 09:30-11:00hrs 11:15-13:00 hrs 13:45-15:15 hrs

Benefit Cost Ratio [B/C], Pay Back Period, Cost

Effective Methods

Distributive / Social analysis, assignment of weights, with examples,

Sensitive Analysis

Effects of Inflation on Project Viability II

Incremental / Scale analysis -How to determine optimum size of a Project?. Optimum

time to start a project.

Oportunity Cost of Public Funds, Discounting,

Compounding, Annuity, WACC

Different Investment Criteria, Net Present Value

[NPV] Method and ExamplesInternal Rate of Return

[IRR] Method

Preparation of Proforma Cash flow statements from

different perspectives

Effects of Inflation on Project Viabilty I

Programme Opening And Introduction to the Programme

Classification of Costs,Real & Nominal values, Accrual &

Cash forms of accounting

02 FebruaryMonday

03 FebruaryTuesday

04 FebruaryWednesday

05 FebruaryThrusday Risk Analysis and Scenario

Analysis

06 FebruaryFriday

Quantification of Risks by Monte Carlo Simulation

Risk Management options, use of Monte Carlo simulation

to reduce project variability

15:30 - 17:00Hrs

TEA

BREAK

Case Exercise on Risk Analysis (Monte Carlo Simulation) and

Risk Management-I

Case exercise on Scenario Analysis

Case exercise on Proforma Cash Flow statements from

different perpectives

Case exercise on calculation of NPV/IRR

Case exercise on Sensitivity Analysis

Case exercise on Risk Analysis (Monte Carlo Simulation) and Risk

Management-II

SCHEDULE OF THE PROGRAMME

FACULTY

TRAINING PROGRAMME ON “PROJECT APPRAISAL, RISK ANALYSIS AND RISK MANAGEMENT”

PROGRAMME DATES

The training programme will be conducted from 02nd February [Monday] to 06th February [Friday] 2015. Teaching schedule is 9.30 AM to 5.00 PM daily.

VENUE

Venue is Lecture Room 1 (Annexe) of India International Centre, 40 Max Mueller Marg New Delhi 110003

TEA AND LUNCH

The participants would be provided tea at 11:00 AM and 3.15 PM as well as lunch at 1.00 PM.

The participants would be required to make their own arrangements for stay in Delhi. The participants must bring their own laptop computers with Excel programme for doing case exercises. The participants would be provided lecture notes and required reading materials.

TRAINING FEES

The fee for the training programme is `44,944 (`40,000 Plus `4,944 as service tax) per participant. Training fee would be payable through Cheque or bank draft payable at Delhi to “Project Appraisal Consultants LLP” or can be transferred to bank account of “Project Appraisal Consultants LLP”, which can be obtained through email. The cheque/bank draft and nomination should be sent to following address: JARNAIL SINGH B0/2 Welcomgroup CGHS Ltd. Plot 6, Sector 3 Dwarka, New Delhi 110078

LAST DATE FOR NOMINATIONS/APPLICATIONS IS 15TH JANUARY 2015

For enquiry and registration contact : Email:- jarnailsingh@project-appraisal.com, jarnail65@gmail.com.

PREVIOUS PROGRAMMES Project Appraisal Consultants have conducted two such programme; first from 10th to 14th February 2014 and second from 03rd to 7th March 2014. These programmes were attended by 67 participants from 31 States/Agencies/ Organisa-tions and have received excellent gradings.

INFORMATION, LOGISTICS AND REGISTRATION

Project Appraisal ConsultantsB0/2, Welcomgroup C.G.H.S. Ltd, Plot 6, Sector 3, Dwarka, New Delhi 110078

P:+919868216710, +919818009365, 01145669365, www.project-appraisal.com, www.projectappraisal.in