We must draw a distinction between a project profile and a feasibility report. A profile is a short write up which summarises or highlights essential features of the project while a report examines all aspects of the project thoroughly.
Thus a project profile maybe regarded as a snapshot while a feasibility report is a motion picture since it digs into the past, examines the present and project into the future. Most people who think they can write reports end up producing documents that cannot pass the test.
And this is the more reason why it should be left in the hands of professional consultants not quacks or charlatans. On identification of an investment opportunity, a potential investor approaches, consults and commissions a consultant to undertake a comprehensive report.
The professional starts by taking the brief he listens careful makes his notes and examines the proposal thoroughly. He now goes on and formulates the brief into some specific terms of reference which will serve as a reliable guide towards the realization of the objectives of the proposal.
Thus the purpose(s) of the study is clearly defined and stated. The professional now examined the scope of the study and the amount of work involved. He splits the whole job into units or stages arranged in a logical sequence. He then determines the approach to be adopted at each stage of the proposed study.
Financial Aspect Of A Report
The professional must consider his clients financial background in order to determine the financing plan of the proposed enterprises. If loans are needed, he should find out his clients bankers and liase with the bank’s credit managers to ensure that his appraisal methods are in line with the bank’s peculiar requirements so that the report will not be rejected.
In making financial projection, adequate provision should be made to handle risks involved in the business, statistical techniques, viability analysis and sensitivity tests should be carefully applied to ensure standard and accuracy. Thus the final document will be authoritative, scientific, comprehensive and bankable.
Tags: adequate provision, credit managers, feasibility report, financial projection, viability analysis