G31 - Capital Budgeting; Fixed Investment and Inventory Studies; CapacityReturn

The article analyses expected impacts of The Anti-Tax Avoidance Directive (ATAD) implementation, respectively planned amendment to the Czech Income Tax Act, which implements among others also administrative limitations on tax deductibility of interest expenses, and tax shields used in company valuation. The article presents time distortion in calculation of tax deductibility of interest expenses and the amount of interest-bearing capital after the regulation on a practical example. Then it defines general formulas for the calculation of tax shields resulting from the regulation including the model for the second phase of valuation. The article states the main topics in business valuation which will be affected by the regulation.

To identify errors, fraud and creative accounting can be used several groups of instruments, ranging from methods based on legislation, ethics, to mathematical models. In this paper, we bring a draft of the quick detection model Q-DMFCA (Quick Detection Model Flow Cost Accounting). It is based on environmental accounting, using its records and consists of balances: material as a basic; in another financial balance and legal. The model was applied in two enterprises, there were evaluated the strengths and weaknesses of the proposed model. The further processing should be focused on the impact on sales margin, comparison to other models and audit options in this case and in Farm Accounting Date work as well.

Payback period is not suitability criterion for evaluation great part of investment projects and also for creation guaranteed redemption price of energy. It ignores time factor and also cash flows after the cut-off date. For projects with greater internal rates of return and with longer economic lives it can be proved that evaluation by payback period and by internal rate of return is significantly approximate. Interest payments from long debt capital should not be included in project cash flow. It can be used precisely valuation by adjusted net present value or by adjusted weighted average cost of capital.

Objective of the article is the analysis of gross fixed capital formation in CR, investment rate and efficiency of investment during 2005-200. Different modification of investment rate is used. Efficiency of investment is observed by ICOR. Investment rate, efficiency of investment and saving rate are compared.

Depreciation expresses impairment of an asset and decreases its net book value stated in the balance sheet. It allows attributing purchase cost of an asset across its useful life and it is considered to be a financial resource. In the capital budgeting theory and practice in the Czech Republic it is necessary to distinguish accounting, managerial, and tax depreciation and take into account specifics resulting from Czech accounting and tax legislation. Expected investment cash flows are influenced not only by depreciation of new purchased assets, but also by depreciation of present assets, even thought the asset purchased cost has been "sunk". Cash inflows resulting from the depreciation tax shield can be considered as the main impact of depreciation on investment cash flows. Capital decision should include selection of an appropriate method of tangible assets tax depreciation, which ensures maximization of present value of depreciation tax shields.

Typical requirements for investment units export financing are high capital, specialized financing and export banks that are associated with insurance agencies. Investment units export financing is often accompanied with various long term investment risks and payment risks. Foreign exchange exposure and risk are relatively low in comparison with the other risks. Common alternatives of export investment units export financing are supplier and customer long term credits, project financing, export financial leasing, and pre-export financing. The majority of countries have national systems of export promotion by means of special export banks and securing societies. State export promotion of investment units must not disturb the international competitive environment. Economic recession in the Czech Republic requires improvement of entire export financial system. This system should be expanded outside European Union, and also offered to project developers. More funding should be allocated in order to sufficiently cover pre-exporting financing, financing of foreign market prospects, and export of services.

The paper deals with budgeting of building firms. Firstly, factors determining character and structure of building budget are described. Secondly, basic types of building budgets are distinguished and their drawbacks are identified. Finally, the attention is devoted to invoicing of building activities.

Firm's financial resources must be characterized in other way than resources included to liability of balance sheet. Financial resources are created by total receipts, increase of equity and debt capital, subsidies and leasing. Internal resources of firm include not only its profit, but total receipts, inclusive deprecation. Internal resources are the dominating investment's resources in majority of non-financial firms in foreign countries, also in Czech Republic. Depreciation plays the crucial share in internal resources of investment. Cost of depreciation, as the resource of long-term financing, is determined by average firm's cost of capital. In world practice of project's financing in last years is often used Public Private Partnership system. This system is expected to create the stronger pressure on timely project's implementation and on cost savings. Necessary condition of its application is the high quality contract between state and private firms, improvement of planning and reporting of public debt and also consistent control on project's implementation.