Capital Budgeting Practices in Nepal and the US
Dr. Jason Lin, Faculty Mentor
Companies use capital budgeting to make investment decisions. It is imperative for companies to invest the required resources in choosing the right technique because these decisions help determine the ultimate profitability of an investment. Capital Budgeting Techniques (CBTs) have evolved over time and most companies in the US have moved on to coincide with the preferences of literature, mainly discounted cash flow techniques (DCF). Researches conducted in the past have suggested that the majority of the Nepalese companies use non-DCF techniques. With the rise of information technology (IT), and the new generation of young CEOs, it becomes essential to understand whether Nepalese companies have shifted to different techniques. Questions still linger regarding the possibilities: do they have the necessary resources and technology to use DCF techniques for their investments? In a country where the odds are always against an investor due to political and economic reasons, it is interesting to understand entities in such an economy and the techniques they are using to make their investments.
Keywords: Capital Budgeting, Nepal, Investment, Technology, Discounted Cash Flow, Corporate Finance, Nepalese Companies, Decision making
Presentation Type: Oral Paper
Location: VH 1416