INTRODUCTION

Cost-benefit analysis is used by governments and other organizations to evaluate the desirability of a given policy or to justify the allocation of scarce financial resources to attain an established performance goal. Cost-benefit analysis also provides a portable, scalable model for organizing facts, assumptions, estimates, and findings in support of complex decisions. This course introduces concepts that are applicable to selecting optimal decisions through the use of trade-off analysis. In the course, financial and program staff, such as budget and program analysts as well as project managers and contracting personnel, will learn to conduct accurate cost-benefit analyses, thereby identifying choices that increase public welfare and improve efficiency.

DURATION

10 Days

WHO SHOULD ATTEND

This course is designed for individuals who want to understand and apply cost-benefit analysis to support decision-making in their organizations.

COURSE LEVEL: Intermediate

Course Objectives

• Select measurement(s) and measure all cost-benefit elements
• Forecast cost and benefits over a relevant time period
• Convert all costs and benefits into a common currency
• Apply a discount rate
• Calculate net present value of project net benefits
• Perform sensitivity analysis
• Evaluate alternatives and select the best value option based on costs and benefits
• Incorporate risk (uncertainty) in calculating costs and benefits
• Utilize Microsoft Excel tools to facilitate compilation and analysis of cost-benefit elements
• Reference applicable OMB guidance and Executive Orders

COURSE OUTLINE

Cost-Benefit Analysis Fundamentals

• Cost-Benefit Analysis Defined
• Critical Concepts for Cost-Benefit Analysis
• Uses for Cost-Benefit Analysis
• What Documents Provide Guidance for Federal Programs?
• Presidential Executive Orders
• Cost Benefit Analysis Essentials
• Basic CBA Decision Criteria Measures
• Conflicting Measures
• The Need for More than One Measure
• Distinguishing Negative Benefits from Costs
• Cost Effectiveness Principle
• Lesson Wrap-Up

Costs

• Relevant and Non-relevant Costs
• Opportunity Costs versus Outlays
• Sunk Costs versus Future Costs
• Fixed Versus Variable Costs
• Total Costs
• Mixed Costs
• Depreciation
• Direct versus Indirect Costs
• Personnel and Overhead Costs
• Lesson Wrap-Up

Benefits

• Guidance for Quantifying Benefits
• Creating Models for Benefits to the Public Without Price Data
• Weighing and Scoring Benefits
• Calculating Benefits of Regulatory Action
• Computing Benefits Where Price Data Is Available
• Lesson Wrap-Up

Time Value of Money

• Concept of the Time Value of Money
• Simple Interest
• Compound Interest
• Future Value
• Present Value
• Present and Future Value Using Excel Functions
• Lesson Wrap-Up

Time-Based Decision Criteria Measures Used in Cost Benefit Analysis

• The Timing of Costs and Benefits and the Cash Flow Diagram
• The Payback Period
• The Net Present Value
• The Principle of Equivalence
• Calculating the Net Present Value
• Excel’s NPV function
• Discount Rate
• Internal Rate of Return (IRR)
• Lesson Wrap-Up

Sensitivity Analysis

• Uncertainty Versus Risk
• Expected Value with Uncertainty
• Sensitivity Analysis
• Sensitivity Analysis in Excel
• Performing a Sensitivity Analysis Using Excel's Data Table Feature
• Performing Sensitivity Analysis Using Excel's Scenario Manager
• Lesson Wrap-U

Course Administration Details:

METHODOLOGY

The instructor led trainings are delivered using a blended learning approach and comprise of presentations, guided sessions of practical exercise, web-based tutorials and group work. Our facilitators are seasoned industry experts with years of experience, working as professional and trainers in these fields.

All facilitation and course materials will be offered in English. The participants should be reasonably proficient in English.

ACCREDITATION

Upon successful completion of this training, participants will be issued with an Indepth Research Institute (IRES) certificate certified by the National Industrial Training Authority (NITA).

TRAINING VENUE

The training will be held at IRES Training Centre. The course fee covers the course tuition, training materials, two break refreshments and lunch.

All participants will additionally cater for their, travel expenses, visa application, insurance, and other personal expenses.

ACCOMMODATION AND AIRPORT PICKUP

Accommodation and airport pickup are arranged upon request. For reservations contact the Training Officer.

Email:[email protected]/[email protected]

Mob: +254 715 077 817/+250789621067

TAILOR- MADE

This training can also be customized to suit the needs of your institution upon request. You can have it delivered in our IRES Training Centre or at a convenient location.

For further inquiries, please contact us on Tel: +254 715 077 817/+250789621067

Mob: +254 792516000, +254 792516010 , +250 789621067 ,or mail [email protected]/[email protected]

PAYMENT

Payment should be transferred to IRES account through bank on or before start of the course.

Send proof of payment to [email protected]/[email protected]

DOWNLOADABLE DOCUMENTS: