Discounted cash flow

The use of analytical techniques in the field of management is becom ing of increasing importance in this country and, in the area of financial management, the rise to prominence in recent years of the Discounted Cash Flow technique has been welcome.

It is a technique that is probably less understood by managers and accountants than it might otherwise be because of the 'mystique" that seems to surround it. This may be because the concept of the present value of money is one that has been derived from the sphere of economics and, also, because there is a fear that it cannot really be understood without resort to higher mathematics.

The purpose of this book is to remove some of these difficulties by explaining the underlying concepts of the technique and showing that they can be readily understood at all levels of management; further, that when understood, the concepts are not difficult to use in a practical way for the purpose of capital investment appraisal. Even where the more sophisticated forms of D.C.F. are used, includ ing the use of the computer, the manager should be able to under stand the implications of the factors that have been used, and be in a position to appraise the results.