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What is Project Appraisal?

Project appraisal is an important activity to evaluate the key factor of the project to check the viability of a project proposal. We can use various Appraisal methods and tools to accept or reject the project. For example, economic or financial appraisal analysis, Excel Templates and other decision techniques.

And in this topic, we will see the different aspects of the Appraisal process of Project in project management. And Its types, methods, factors, Excel & PowerPoint Templates, tools and techniques.

Project Appraisal Definition & Meaning

It is an important activity to evaluate the key factor of the project to decide and proceed with the project proposal and ability.

Project Appraisal Objectives

Here are the Key objectives of the Appraisal Process of a Project:

  • Assessment of a project in terms of its economic, social and financial viability
  • Decide to Accept or reject a Project
  • It is a tool to check the viability of a Project Proposal

This topic will answer all the above questions related to Project Appraisal.

Project appraisal in the international context

International context of Project Appraisal: Assessment of a project in terms of its financial, economic, technical and management and governance viability.

Importance of project appraisal

As mentioned earlier, Appraisal process of a Project is a very important activity to perform before accepting a Project. And this will help you to check if you can complete the project. So that you can accept and reject the Project Proposal.

Features project appraisal

Here are the Key Features of the Appraisal of Project:

  • Evaluate the key factor of a project
  • Decide to Accept or reject a Project
  • It is a tool to check the viability of a Project

 

Steps in project appraisal process

Here are the key steps this process. Proposal of a Project is assessed with the below steps and aspects.

  • Financial and Economic appraisal
  • Organizational or Management Appraisal
  • Marketing and Commercial Appraisal
  • Technical and Legal Appraisal

Types of Project Appraisal and aspects

Project Appraisal is process of assessing the following types of the Appraisal Aspects. And these Key aspects of appraisal will be evaluated before committing a Project.  Appraisal factors are evaluated by a personal who is not involved in the preparation of the Project Proposal.

  • Organizational Aspects
  • Technical Aspects
  • Managerial Aspects
  • Economic Aspects
  • Financial Aspects
  • Marketing and Commercial Aspects

Project Appraisal Guidelines

Here are the guidelines for Project Appraisal Process:

  • Project should assess in terms of its economic, social and financial viability
  • Various aspects of a Project should asses before committing a project
  • An individual person or a team who are not involved it’s the preparation of Project Proposal should assess the Project.

Project Appraisal Techniques and Methods

Here are the key techniques of this process. Proposal of a Project is assessed with the below techniques and methods.

  • Technical Feasibility
  • Economic and Financial Analysis
  • And Marketing and Management Competence

We use various techniques for assessment of the Project Proposal. Let us see each appraisal technique in detailed:

Project Appraisal Financial Analysis

Financial analysis helps to assess the cost of the project and review the project revenues. And this type of appraisal analysis helps the company to avoid overspending on a project resource and requirements to produce the outputs. This will also help the organizations to check feasibility of alternatives to spend less and gain more profits. Below are the key things we can understand by performing the Financial Analysis.

 What do you understand by Financial appraisal of a project?

  • Cost: Finding out the cost to complete the project and produce the outputs
  • Pricing: Setting of the Product Pricing for Profits
  • Financing: Increasing in investment and efficient use of the fund
  • Investment vs Income: Understanding the cost of production and Profits

Project Appraisal Economic Analysis

Economic analysis of Appraisal helps to justify the benefits of the project vs cost to produce the product. And below are the key things we can understand by performing the Economic Analysis.

What do you understand by economic appraisal of a project?

  • Benefits of the Projects, Products and Features
  • Justification of the products by comparing with the Project Cost of Production.

This will also help to check the following benefits the project.

  • Better output
  • Better services
  • Better employment
  • Better revenue
  • Better earnings
  • Better standards
  • Better income
  • Better distribution

Technical Analysis

Technical analysis helps to study the technical aspects of the Project. For example, assessment of Tools and Techniques, Design, Plans and Schedules.

Organizational Analysis

Organizational analysis of helps to see if project is adequately staffed with the structure of the Organization. And helps to check Resource, Recruitment, and Training aspects.

Managerial Analysis

Managerial analysis of helps to assess competency and business knowledge of the promoter’s aspects.

Market/Commercial Aspects

Market/Commercial analysis helps to assess the market opportunities, marketing objectives, Marketing process Plans

Project appraisal report

We can create Appraisal Report to understand the different aspects of project viability.

Here is the Example format of appraisal report format of a company.

Project appraisal tools and techniques

We have already seen the various techniques of Project Appraisal Process. And below are the Project Assessment tools and templates to capture the various topics and assess it.

Project appraisal format

Below are the top Project Appraisal Formats. We can maintain these Excel or PowerPoint File to capture the required topics and techniques. And this helps to assess and to decide to accept or reject a Project Proposal.

Project appraisal examples

The below Project Appraisal Examples are provided with dummy data with no valid meaning. You can clear the existing data and capture your information.

Project appraisal excel template

Here is the Excel Template. You can go to the second sheet to see the template. The first sheet of the template contains the brief information about the Project Appraisal Excel Template. And the second sheet is the actual spreadsheet to capture your data.

Project Appraisal Excel Template

Also, you can capture the topics with appraisal techniques and methods. The Fourth Column (Feasibility Score) you can enter the number between -5 and 5. And the Weight is important factor of the assessment topic.

On the right-hand side, you can see the overall Appraisal Score of Project, and you can enter the minimum acceptance score to decide to accept/reject the project proposal.

Project appraisal PPT template

Here is the PPT Template. It is a PowerPoint Format Appraisal Report Template. You can enter the project information which you have assessed.

Project Appraisal PPT Template

You can use the left-hand side section in this Project appraisal PPT template for your observations. And right-hand side table will help you to capture the assessed metrics.

The bottom section of the PPT template helps you to write your conclusion or Summary. You can also use this appraisal PPT template in Team and Customer Presentations.

Project appraisal PDF Template

Here is the PDF Template, this is the copy of the above (PowerPoint) template in the pdf file format. And you can use this Project appraisal PDF Template to Print and write your Appraisals.
Project Appraisal PDF Template

Project appraisal questions and answers

Here are the Frequently asked Project appraisal questions and answers:

  • What is project appraisal?: It is an important tool to evaluate the key factor of the project to check the viability of a project. We can use various methods and tools to commit the Project. For example, economic aspects analysis of the Project or financial aspects analysis of the Project. We can use Excel, PPT Templates and other decision techniques for this process.
  • What are the various aspects?: The important aspects of the Project are: Technical aspects, Economic aspects, Financial aspects, Marketing aspects and Management aspects
  • What is market appraisal of a project?:Marketing appraisal analysis of a Project helps to assess the market opportunities, marketing objectives and Marketing process Plans
  • What is financial appraisal of a project?: Financial appraisal analysis of a project helps to assess the cost of the project and review the project revenues. This helps the organizations to avoid over budgets on a project resource and requirements to produce the outputs. This will also help the companies to check feasibility of alternatives to spend less and gain more profits.
  • What is economic appraisal of a project?: Economic Appraisal analysis of project helps to justify the benefits of the project vs cost to produce the product.
  • What is technical appraisal of a project?: Technical Appraisal analysis of project helps to observe the technical aspects of the Project. For example, assessment of Tools and Techniques, Design, Plans and Schedules.
  • What are the methods and components of project appraisal?: The methods, components, factors and elements are: Technical methods, Economic methods, Financial methods, Marketing methods and Management methods
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Last Updated: June 8, 2023

5 Comments

  1. hasham Khan March 16, 2020 at 5:00 PM

    well nice one

  2. Emily September 16, 2020 at 9:48 AM

    So brief and understandable. That’s great job.

  3. Felix October 7, 2020 at 1:23 PM

    very helpful. thank you

  4. Ayangba Abingyuure John December 13, 2022 at 6:30 AM

    I really learned a lot from this document.
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    • Prince March 9, 2023 at 4:46 PM

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