Financial feasibility study details the capital needed to start a project along with the varied ways one can get access to capital, ROI (return of investment). It also deals with projecting other financial aspects of a project that a company is undertaking. In simple terms, it indicates that such reports project how much money is needed to start the project, from where that amount can be obtained, how to use that money effectively.
The study of the financial feasibility of a project would be able to clearly express the findings and detect what could be the problems associated beforehand. It will be able to determine if the project is good enough to be started in the first place or not? It works effectively for any industry be it the construction industry, the healthcare industry, the electronics industry, the education industry, the hospitality industry, the pharmaceutical industry etc. Whether it is a start-up or an established company, it is preferable to have such a report before the commencement of the project.
It is important to have a report before starting the project. These reports have an important role in the project that the company is going to undertake. It accesses the financial aspects of the project at the beginning and during the course of the project.
A financial feasibility report can be used under the following conditions -