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“operational environment”

he finance section of an effective business case is primarily for those who approve funding. The finance function will be interested in this plus the first half of the project definition.

Financial Appraisal

When you prepare the financial appraisal seek advice on content and presentation from the finance function. In the case of capital developments, consult subject matter experts.

The purpose of a financial appraisal is to:

  • identify the financial implications for the project,
  • allow comparison of project costs against the forecast benefits,
  • ensure the project is affordable; ensure every cost associated with the project is considered,
  • assess value for money, and
  • predict cash flow.

Sensitivity Analysis

Sensitivity analysis concerns project risk and looks at alternative futures by measuring the impact on project outcomes or assumptions of changing values in which there is uncertainty.

In effect, sensitivity analysis lets the project accountant experiment with possible scenarios.

3. The Project Definition

This is the largest part of the business case and is for the project sponsor, stakeholders, and project team.

It answers most of the why, what, and how questions about your project.

Background Information

The purpose of this section is to give a clear introduction to the business case and project. It should contain a brief overview of the reasons why the project or business change has come about: the problem, opportunity, or change of circumstances.

If necessary, refer to related programmes, projects, studies, or business plans.

Business Objective

This part describes why are you doing the project. The business objective answers the following questions:

  • What is your goal?
  • What is needed to overcome the problem?
  • How will the project support the business strategy?