| 1.5.1 | Other forms of appraisal may be required in addition to an economic appraisal. For example, an affordability appraisal is generally required. (See section 2.9.2 for elaboration). Another example is the necessity to assess the commercial viability of proposals when appraising assistance to the private, voluntary and community sectors, as is explained in Section 4 below. This normally includes assessment of the general financial position of the applicant, consideration of its management capability, marketing appraisal, identification of relevant financial cash flows, and calculation of NPVs on a commercial appraisal basis. |
| 1.5.2 | The differences between economic appraisal and commercial appraisal can be a cause of confusion. Comparison of Economic and Commercial Appraisal defines the main forms of economic appraisal, lists some common errors in appraisal and explains how economic appraisal is distinguished from commercial appraisal. It also includes a checklist to help identify what items to include in each. Commercial appraisal calculations, where required, should normally be done separately from, and in addition to, the calculation of NPVs on an economic appraisal basis. |
| 1.5.3 | A commercial appraisal, or affordability appraisal, or any other appraisal of some specific aspect of a proposal, should never be seen as an alternative to an economic appraisal covering the ten steps listed in the Basic Steps Table above. |
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