| Author | Nguyen Thai Ha |
| Call Number | AIT RSPR no.SM-97-68 |
| Subject(s) | Capital budget--Vietnam
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| Note | A research submitted in partial fulfillment of the requirements for the degree of Master in Business Administration. |
| Publisher | Asian Institute of Technology |
| Series Statement | Research studies project report ; no. SM-97-68 |
| Abstract | Capital budgeting decision is the most important one in financial management. A proper procedure of capital budgeting can improve the moderation of assets acquired, the efficiency and effectiveness of investment decisions. Unfortunately, there are very few understanding about capital budgeting in Vietnam. Therefore, this research was carried out with the objectives to have an understanding about capital budgeting process in large industrial corporations in Vietnam. The practical recommendations were suggested to improve existing capital budgeting system. To achieve the given objectives, a framework for this study was developed from the present finance literature, which covers most important aspects of the capital budgeting process. This framework was used to design the questionnaire, the interview and the analysis of the research. An in-depth study was conducted in Unilever-Vietnam. Structural questionnaires was also sent to 50 selected companies in various industries. The analysis was carried out based on the data collection from Unilever-Vietnam and from the 16 respondent companies in the survey. It can be concluded from the analysis of the data that capital budgeting is used by the majority of the large companies surveyed. The capital budgeting is for the purpose of evaluating and making better decisions in the capital investments. The main features in the capital budgeting in the companies in Vietnam are highlighted as follows : Most companies apply "top-down" planning and they usually emphasize the strategic considerations in decision making on the capital investments. However, they usually conduct the short-term plan for the capital investment of less than 3 years. In financial assessment of the capital investment project, payback period, IRR and NPV are most commonly used. Companies use popularly the single corporate hurdle rate as cut-off rate of the project. The post-completion audit are commonly conducted for only large projects. Some recommendations were suggested to improve the capital budgeting practice in Vietnam which include the encouragement for the generation of the capital investment proposals in the companies, a method for calculating cost of capital and a method for computing the project's cash flow etc. |
| Year | 1997 |
| Corresponding Series Added Entry | Asian Institute of Technology. Research studies project report ; no. SM-97-68 |
| Type | Research Study Project Report (RSPR) |
| School | School of Management (SOM) |
| Department | Other Field of Studies (No Department) |
| Academic Program/FoS | Master of Business Administration (MBA) (Publication code=SM) |
| Chairperson(s) | Gupta, J.P.; |
| Examination Committee(s) | Pandey, l.M.;Khang, Do Ba; |
| Degree | Research Studies Project Report (M.B.A.) - Asian Institute of Technology, 1997 |