Capital Budgeting and Financial Investment Appraisal: A Review of Archival Literature

Abstract

Abstract: Universally, fund raising issues and capital utilitization have been the heart-beat of all financial managers both in the private and public sector. However, profitable utilization of scarce financial resources by various sectors has become more important as cost of fund raised daily has become increasingly astronomical. Hence, the financial manager must do all that is possible to generate returns that will not only be sufficient to meet the cost of funds but also enough to satisfy the wealth maximization objective of the firm. Raising finance for corporate bodies thus becomes important and of highest import. Thus, the aim of this study is to carry out a detailed review of archival literature on the roles of financial management in capital investment appraisal. In this study, the authors intend to review archival literatures to find out the contributions of financial managers in making good financial decisions and to reveal the impact of capital budgeting techniques on financial projects. This simply will provide the reader full detail information about how the necessary data/materials used in the study was collected. The data used for the research were collected by means of vital and relevant data from secondary sources through the review of some related and available documents such as textbooks, term papers, and business publications like magazines, journals, newspaper, periodicals, published and unpublished works and statistical records. This study found that in other to achieve the desired goals of financial managers in effective decision making senior management of any organization must bear in mind that observation of the doctrine of capital investment appraisal must be obeyed and properly executed in the organization.