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An Assessment of Risk Factors Involved in Modeling Cash Flow Forecast

Biomedical Sciences Research Institute Computer Science Research Institute Environmental Sciences Research Institute Nanotechnology & Advanced Materials Research Institute

Odeyinka, Henry and Lowe, John (2000) An Assessment of Risk Factors Involved in Modeling Cash Flow Forecast. In: Association of Researchers in Construction Management (ARCOM) Annual Conference, Glasgow Caledonian University, UK. Association of Researchers in Construction Management. Vol 1 (1) 9 pp. [Conference contribution]

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URL: http://www.arcom.ac.uk/

Abstract

Many models have been developed to assist contractors and clients in their cash flow forecasting. The majority of these have been based on standard cash flow S-curves, developed using the traditional manual approach, mathematical and statistical models.Many of these models failed to consider and analyse the factors responsible for the considerable variations in the modelled cash flow profiles. This study as a first step in a knowledge-based expert system (KBES) modelling of construction cash flow to incorporate risk and uncertainties, identified and assessed the risk factors responsible for the variation in construction cash flow profiles. The study was conducted through a questionnaire survey administered on contracting organisations. Analyses were carried out using mean response and univariate analysis of variance (ANOVA). Results showed that the major risk factors involved in cash flow forecasting relate to changes in the design or specifications, contract conditions pertaining to cash in flow, interim valuations and certificates and construction programming issues such as inclement weather. Results also indicated that cash flow forecasting modelling that incorporates risk would need to consider categorisation along the groupings of firm size, procurement methods and construction duration.

Item Type:Conference contribution (Paper)
Keywords:Cash flow, construction projects, contractors, modelling, risk factors
Faculties and Schools:Faculty of Art, Design and the Built Environment
Faculty of Art, Design and the Built Environment > School of the Built Environment
Research Institutes and Groups:Built Environment Research Institute
Built Environment Research Institute > Centre for Sustainable Technologies (CST)
ID Code:13815
Deposited By:Dr Henry Odeyinka
Deposited On:20 May 2010 13:38
Last Modified:20 May 2010 13:38

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