P3 Toolkit

Analytical Tools

P3-VALUE: Financial Assessment Tool User Manual

April 19, 2013

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Chapter 2. Quick-Start Guide

While the User Manual provides detailed guidance on the Financial Assessment Tool, users may also refer to the "Quick-Start" version below for step-by-step instructions.

ACCESSING THE FINANCIAL ASSESSMENT TOOL

1. Open the tool.
2. Click "Enable Editing" and/or "Enable Content" on yellow bar across top of screen.
3. Read the disclaimer and Click "I accept."

CONDUCTING A VfM ANALYSIS

1. CLICK the "VfM ANALYSIS" button on THE TOOL INDEX to navigate to the "VfM Analysis" section of the tool.
   This section allows users to make a comparison between the PSC and Shadow Bid to assess value for money.

IMPORT NPC and CASH FLOWS.

1. Navigate to the "Source Data" tab.
2. Click "Browse for PSC Tool."
   1. In the dialog box, navigate to the directory where the PSC tool is saved
   2. Select the file name. The file's path should populate in the 'PSC' row.
   3. Click "Import NPC Results."
      Note: This may take a few minutes. Once the import is complete, you will see a dialog box that says, "Results have been loaded." Click 'OK.' 
3. Click "Browse for Shadow Bid Tool."
   1. In the dialog box, navigate to the directory where the Shadow Bid Tool is saved.
   2. Select the file name. The file's path should populate in the 'Shadow Bid' row.
   3. Click "Import Cash Flows."
      Note: This may take a few minutes. Once the import is complete, you will see a dialog box that says, "Results have been loaded." Click 'OK.'

REVIEW COMPARISON
Note: It may be useful to refer to the Financial Assessment Tool User Manual in understanding the results.

1. Navigate to the "Model VfM_PSC Outputs" sheet to review the side-by-side comparison of the PSC and Shadow Bid costs.
2. Navigate to the "NPC Results" tab to review another side-by-side comparison of the PSC and Shadow Bid costs with different levels of risk.
3. Navigate to the successive results charts to review graphical representations of this comparison and of the cash flows.

CONDUCTING A VIABILITY ANALYSIS

1. Click the "viability assessment" button on the tool index to navigate to the "viability assessment" section of the tool.
This section allows users to assess a project's cash flows to determine the amount of additional funding needed to deliver the project.

INPUT ASSUMPTIONS.

1. Navigate to the "Assumption" tab.
2. In light-blue cells, input assumptions regarding project delivery structure, timing, design and construction costs, operation and maintenance costs, toll and other revenue, funding, inflation, risk costs, and discount rate.
   Note: This data is used to construct a project's cash flow, which estimates the net project cost before considering the project delivery method.

REVIEW RESULTS

1. Navigate to the "Viability Disclaimer" sheet and click "I Accept."
2. Navigate to the "Viability Output" sheet.
3. Review the "Cash Flow Viability - NPC Summary" table for the calculation of the initial project estimate and risk-adjusted net project costs.
4. Review the "NPC Results" graph for another representation of the net project costs.
5. Run the Sensitivity Analysis.
   1. Select the risk percentile in the light-blue shaded drop-down menu in the "Sensitivity Analysis" Table.
   2. Select the result type ($ or %) in the light-blue shaded drop-down menu in the "Sensitivity Analysis" Table.
   3. Click "Run Sensitivity."
   4. Review the results to understand the sensitivity of the NPC results to changes in assumptions.
6. Run the Scenario Analysis.
   1. Select "Cash Flow Viability" in the "Scenario Type" drop-down menu adjacent to the "Load Scenario Button."
   2. Select "On" in the "Financing Assumptions" row.
   3. Select "bond" (to provide financing at the start of the project) or "draw" (to draw down financing as needed throughout the project) in the "Facility Type" row.
   4. Input the length of the maturity period (in months).
   5. Input the interest rate (as an annual percentage).
   6. Input the cost of facility fees (as a percentage).
   7. Insert the length of the grace period (in months).
   8. Click "Run Financing" and recalculate the Sensitivity analysis to reflect the net project cost including financing. View changes to results in the Cash Flow Viability - NPC Summary table.
      Note: You may run the scenario analysis to assess the costs of delivering the project as a P3 by selecting "VfM Viability" from the "Scenario Type" drop-down menu, inputting the financing assumptions, and clicking "Run Financing" once more.

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