Financial evaluation of forestry investments: common pitfalls and guidelines for better analyses

Harrison, Steve and Herbohn, John (2016) Financial evaluation of forestry investments: common pitfalls and guidelines for better analyses. Small-scale Forestry, . doi:10.1007/s11842-016-9334-1


Author Harrison, Steve
Herbohn, John
Title Financial evaluation of forestry investments: common pitfalls and guidelines for better analyses
Journal name Small-scale Forestry   Check publisher's open access policy
ISSN 1873-7854
1873-7617
Publication date 2016-04-06
Year available 2016
Sub-type Article (original research)
DOI 10.1007/s11842-016-9334-1
Open Access Status Not Open Access
Total pages 17
Place of publication Dordrecht, Netherlands
Publisher Springer Netherlands
Collection year 2017
Language eng
Formatted abstract
Many of the papers submitted to Small-scale Forestry contain financial analyses of forestry investments. Unfortunately, both the method of analysis and the reporting of the analysis in initial submissions are often inadequate, and result in manuscripts being rejected or requiring major revision prior to acceptance. This paper discusses some of the common deficiencies in financial analyses in research papers, and presents a simplified financial analysis of a forestry plantation development to illustrate key points. Simple guidelines are presented to overcome common major weaknesses, for example in identifying relevant cash flows, confusion between financial and economic analysis, dealing with capital outlays, and determining an appropriate discount rate.
Keyword Current versus constant prices
Forestry financial analysis
Plantation costs and returns
Relevant cash flows
Sunk costs
Weighted average cost of capital
Q-Index Code C1
Q-Index Status Provisional Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: HERDC Pre-Audit
School of Agriculture and Food Sciences
 
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