CAPITAL INVESTMENT APPRAISAL TECHNIQUES: A SURVEY OF CURRENT USAGE

CAPITAL INVESTMENT APPRAISAL TECHNIQUES: A SURVEY OF CURRENT USAGE This paper seeks to show that organisational change, fuelled by the expansion of information technology, may have contributed to the erosion of the previously established relationship between company size and the quantitative investment appraisal criteria selected. It finds that companies are using more methods together, that usage of the more sophisticated discounted cash flow techniques is higher, and that usage of the less theoretically sound accounting rate of return technique is lower, than previous studies would have suggested for companies of the size involved. It suggests that the size/method selection relationship may only be identifiable when the companies involved are all part of one study, or the studies compared are contemporaneous. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of Business Finance & Accounting Wiley

CAPITAL INVESTMENT APPRAISAL TECHNIQUES: A SURVEY OF CURRENT USAGE

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Publisher
Wiley
Copyright
Copyright © 1993 Wiley Subscription Services, Inc., A Wiley Company
ISSN
0306-686X
eISSN
1468-5957
D.O.I.
10.1111/j.1468-5957.1993.tb00258.x
Publisher site
See Article on Publisher Site

Abstract

This paper seeks to show that organisational change, fuelled by the expansion of information technology, may have contributed to the erosion of the previously established relationship between company size and the quantitative investment appraisal criteria selected. It finds that companies are using more methods together, that usage of the more sophisticated discounted cash flow techniques is higher, and that usage of the less theoretically sound accounting rate of return technique is lower, than previous studies would have suggested for companies of the size involved. It suggests that the size/method selection relationship may only be identifiable when the companies involved are all part of one study, or the studies compared are contemporaneous.

Journal

Journal of Business Finance & AccountingWiley

Published: Apr 1, 1993

References

  • Accounting and Organisation Change
    Hopwood, Hopwood
  • Performance Measurement and Formal Capital Expenditure Controls in Divisionalised Companies
    Scapens, Scapens; Sale, Sale

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