From the report of corporate director, communities, regeneration and environment of the Stockport Metropolitan Borough Council (SMBC) Scrutiny Committee, which had its priorities on 'A Striving Stockport', 'A Safer, Stronger Stockport', 'A Healthy Stockport' and 'A Greener Stockport', shows that the Stockport community has the highest percentage (37.7%) of working age people who claim out of work benefits among the neighbourhoods. The committee aims at reducing this percentage by about 3.4% in the near future, and so the need to improve the local economy has brought about the launch of the vacant properties initiative.
The DCF is a satisfactory technique that will be used to look ahead of the project to determine its return on investment because it gives the present value for future earnings. The value it represents is known as the Net Present Value (Lock, 2003). Appendix 16 shows a table of discount factor used to determine the DCF and NPV of the project shown in table 10 below.
The Financial and Risk appraisal has helped to look ahead and identified the future prospect of the project. With the actions put in place, it will ensure successful delivery of the project, which is measured in terms of Time, Cost, and Quality. Below is a summary of the key aspects of this report-
Risk Management: This has helped to ensure that the budget is not exceeded due to unexpected events that could result from negligence of people involved in the project. The ripple effect of risk upon the project is that it would not be delivered on time, and when it is delivered eventually, it will be delivered at higher cost than the budget because of expenses to cover the event that weren't included in the original budget.
Financial Planning: The planning process helped to ensure that various available sources of funding were exploited and that the best possible option was chosen in order to maximise the profit to the company also to avoid possible risk of running out funds mid-way into the project which in turn will cause unnecessary delays on the delivery time and quality.
Financial Risk and Appraisal: This has helped to forecast the profit level of the proposed development, which will give the management a level of assurance that the proposed development is of minimal risk and the venture into the project is quite profitable, putting into consideration that there is no interest to payback at the closure of the project.