Ten hard questions to ask or be asked
| 1 | Are percentage changes calculated from the correct base, and are their inverses stated correctly? |
| 2 | Is the interest rate simple or compound? |
| 3 | How often is interest paid, or added to the principal amount? |
| 4 | Is like being compared with like (e.g. are interest rates effective)? |
| 5 | If the time periods are different, has proper account been taken of the time value of money for the unmatched period? |
| 6 | Are residual amounts/values properly accounted for? |
| 7 | Is the most appropriate interest, discount or hurdle rate being used as a yardstick? |
| 8 | Has inflation been correctly factored in to the calculations? |
| 9 | When calculating net present value, what happens if you change the discount rate? |
| 10 | Is the business taking/rejecting ... |
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