Question Tag: Public Sector Finance

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PSAF – May 2021 – L2 – Q4b – Public Sector Reforms

Feasibility analysis of primary health centre PPP project based on guiding principles and associated risks.

Question

The Ministry of Health of Federal Republic of Wazobia is currently
considering public-private partnership as a means of improving health
facilities in some rural areas in the country. The Ministry intends to use
Public-Private Partnership (PPP) to construct and manage modern primary
health centres in rural areas to increase access to quality health facilities.
The project would be fully financed by the private sector, but will be built
on land secured from the state governments. The private sector requires
government guarantee to borrow externally to execute the project.
Currently, health services are free, however, the new project, when executed through Public-Private Partnership would be on “user-pay” basis.
The government and the private contractors determine the average fees
payable per user and it will be subject to an upward review from time to
time. In order to stimulate private sector interest in the project, the Ministry
intends to protect the private sector against risks associated with the
project. Meanwhile, the Ministry would insist that local materials and skills
are employed in the construction and management of the primary health
centre projects. The project is also environmentally friendly as there will be
little or no destruction of the forest vegetation. The project when completed,
will be of great benefit to the country as a whole.

Required:
Based on guiding principles of Public-Private Partnership identify and
explain THREE principles and TWO associated risks of the feasibility of the
proposed primary health centre projects by the Ministry of Health.

Answer

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Tags: Health Facilities, PPP, Project Feasibility, Public Sector Finance, Risk Assessment
Level: Level 2

Topic: Public Sector Reforms
Series: MAY 2021

PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance

NPV-based investment recommendation for Omidan Local Government among three projects and a risk-free security alternative.

Question

Omidan Local Government Council has N20,000,000 to invest, if there is an assurance that the investment will earn at least 12% p.a. In view of this, the following projects are being considered:

Project A will earn N21,800,000 at the end of year one with a residual value of N1,500,000;
Project B will earn N24,000,000 at the end of year two with a residual value of N500,000; and
Project C will earn N14,000,000 at the end of year one and another N10,000,000 at the end of year two with no residual value.

If none of the projects is undertaken, Omidan Local Government Council will invest the N20,000,000 in a risk-free security that will earn interest of 12% p.a.

Required:

Assess and advise Omidan Local Government Council on which of the projects to be undertaken using Net Present Value (NPV) method.

Answer

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Tags: Capital Budgeting, Investment Decision, NPV Analysis, Public Sector Finance, Risk-Free Investment
Level: Level 2

Topic: Government Revenue
Series: MAY 2021

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

Question

a. Oyigbo Local Government is set to improve its internally generated revenue by venturing into the construction of an animal feedmill, which will cost N15 million. The mill, when constructed, is projected to generate a net cash inflow of N3.8 million annually and the useful life is 6 years. The cost of borrowing from a commercial bank for this purpose is 12%.

Required:
Advise the Chairman of Oyigbo Local Government whether or not to undertake the project using the Profitability Index (PI) technique of investment appraisal.

The cumulative discount factor formula to use is:

where $r =$ discount rate, $n =$ number of years. (10 Marks)

b. Identify THREE advantages and TWO disadvantages of the profitability index as a technique for project appraisal. (5 Marks)

Answer

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Tags: Investment Appraisal, Profitability Index, Public Sector Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2024

PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles

Characteristics, structures, and steps for budgeting with National Chart of Accounts.

Question

National Chart of Accounts (NCOA) shows the complete list of budget and accounting items for General Purpose Financial Reporting (GPFS) and budgeting.

a. State FOUR characteristics of the National Chart of Accounts. (4 Marks)

b. Discuss the SIX structures of the National Chart of Accounts for budgeting. (12 Marks)

c. Identify and briefly explain FOUR steps for budgeting with the National Chart of Accounts. (4 Marks)

Answer

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Tags: Budgeting, National Chart of Accounts, Public Sector Finance
Level: Level 2

Topic: Government Accounting Concepts and Principles
Series: MAY 2024

PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)

Discusses three benefits and two adverse consequences of Public-Private Partnerships (PPP).

Question

A Public Private Partnership (PPP) is a cooperative arrangement between two or more public and private sectors, typically of a long-term nature.

Required:

Identify and explain THREE benefits of Public Private Partnerships (PPP).
Discuss TWO adverse consequences of Public Private Partnerships (PPP).

Answer

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Tags: PPP Benefits, PPP Challenges, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public-Private Partnerships (PPP)
Series: NOV 2019

PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector

Explain the steps for conducting Cost Benefit Analysis and Cost Effectiveness Analysis in public sector investment appraisal.

Question

Investment appraisal is a technique aimed at finding out the least possible costs of an investment and the maximum economic benefits, which may accrue from the commitment of resources into it. Cost Benefit Analysis and Cost Effectiveness Analysis are among the techniques used for investment appraisal in the public sector.

Required:
Explain the five steps to be followed in conducting Cost Benefit Analysis and Cost Effectiveness Analysis. (10 Marks)

Answer

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Tags: Cost Effectiveness Analysis, Cost-benefit analysis, Investment Appraisal, Public Sector Finance
Level: Level 2

Topic: Performance Measurement in the Public Sector
Series: NOV 2020

PSAF – May 2018 – L2 – Q5c – Public Procurement

Identify two financial risks in Public-Private Partnership (PPP) arrangements.

Question

Public-Private Partnership (PPP) has become a major vehicle through which the government is leveraging private resources and technology in the provision of public services. However, PPP could become a vehicle for plunging public resources and taking public services out of reach of ordinary citizens. This concern has led to the creation of National PPP policy that provides a framework for effective PPP arrangements.

Required:
Identify TWO financial risks in PPP arrangements.

Answer

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Tags: Financial Risks, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public Procurement
Series: MAY 2018

PSAF – May 2018 – L2 – Q5a – Public Procurement

Explain five guiding principles for Public-Private Partnerships (PPP) in the health sector.

Question

The Minister of Health and his Chief Director attended an international conference on health administration and discovered that most countries around the world are leveraging the private sector in the provision of health infrastructure and the management of operations of existing facilities to secure value for public money.

Upon their return, they decided to explore avenues for Public-Private Partnerships (PPPs) in the areas of construction of health facilities on build-operate and transfer options and management of regional and teaching hospitals on maintain and operate basis or rehabilitate and operate basis. The Minister is passionate about the move and wants to implement it as quickly as possible. However, the Chief Finance Director has drawn his attention to the National Public Private Partnership Policy of the country and advises that they consider it seriously. The Minister has ordered the Chief Finance Director to furnish him with the guiding principles of the PPP arrangements to ensure compliance.

The Chief Finance Director has asked you to critically examine the national PPP policy document and furnish him with key guiding principles on feasible PPP arrangements he can enter into.

Required:
Explain FIVE guiding principles that the Ministry should observe in the proposed PPP projects in the health sector.

Answer

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Tags: Guiding Principles, PPP, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public Procurement
Series: MAY 2018

PSAF – May 2021 – L2 – Q4b – Public Sector Reforms

Feasibility analysis of primary health centre PPP project based on guiding principles and associated risks.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Health Facilities, PPP, Project Feasibility, Public Sector Finance, Risk Assessment
Level: Level 2

Topic: Public Sector Reforms
Series: MAY 2021

PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance

NPV-based investment recommendation for Omidan Local Government among three projects and a risk-free security alternative.

Question

Omidan Local Government Council has N20,000,000 to invest, if there is an assurance that the investment will earn at least 12% p.a. In view of this, the following projects are being considered:

Project A will earn N21,800,000 at the end of year one with a residual value of N1,500,000;
Project B will earn N24,000,000 at the end of year two with a residual value of N500,000; and
Project C will earn N14,000,000 at the end of year one and another N10,000,000 at the end of year two with no residual value.

If none of the projects is undertaken, Omidan Local Government Council will invest the N20,000,000 in a risk-free security that will earn interest of 12% p.a.

Required:

Assess and advise Omidan Local Government Council on which of the projects to be undertaken using Net Present Value (NPV) method.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Capital Budgeting, Investment Decision, NPV Analysis, Public Sector Finance, Risk-Free Investment
Level: Level 2

Topic: Government Revenue
Series: MAY 2021

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

Question

Required:
Advise the Chairman of Oyigbo Local Government whether or not to undertake the project using the Profitability Index (PI) technique of investment appraisal.

The cumulative discount factor formula to use is:

where $r =$ discount rate, $n =$ number of years. (10 Marks)

b. Identify THREE advantages and TWO disadvantages of the profitability index as a technique for project appraisal. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Investment Appraisal, Profitability Index, Public Sector Finance
Level: Level 2

Topic: Government Expenditure
Series: MAY 2024

PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles

Characteristics, structures, and steps for budgeting with National Chart of Accounts.

Question

National Chart of Accounts (NCOA) shows the complete list of budget and accounting items for General Purpose Financial Reporting (GPFS) and budgeting.

a. State FOUR characteristics of the National Chart of Accounts. (4 Marks)

b. Discuss the SIX structures of the National Chart of Accounts for budgeting. (12 Marks)

c. Identify and briefly explain FOUR steps for budgeting with the National Chart of Accounts. (4 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Budgeting, National Chart of Accounts, Public Sector Finance
Level: Level 2

Topic: Government Accounting Concepts and Principles
Series: MAY 2024

PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)

Discusses three benefits and two adverse consequences of Public-Private Partnerships (PPP).

Question

A Public Private Partnership (PPP) is a cooperative arrangement between two or more public and private sectors, typically of a long-term nature.

Required:

Identify and explain THREE benefits of Public Private Partnerships (PPP).
Discuss TWO adverse consequences of Public Private Partnerships (PPP).

Answer

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Tags: PPP Benefits, PPP Challenges, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public-Private Partnerships (PPP)
Series: NOV 2019

PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector

Explain the steps for conducting Cost Benefit Analysis and Cost Effectiveness Analysis in public sector investment appraisal.

Question

Required:
Explain the five steps to be followed in conducting Cost Benefit Analysis and Cost Effectiveness Analysis. (10 Marks)

Answer

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Tags: Cost Effectiveness Analysis, Cost-benefit analysis, Investment Appraisal, Public Sector Finance
Level: Level 2

Topic: Performance Measurement in the Public Sector
Series: NOV 2020

PSAF – May 2018 – L2 – Q5c – Public Procurement

Identify two financial risks in Public-Private Partnership (PPP) arrangements.

Question

Required:
Identify TWO financial risks in PPP arrangements.

Answer

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Tags: Financial Risks, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public Procurement
Series: MAY 2018

PSAF – May 2018 – L2 – Q5a – Public Procurement

Explain five guiding principles for Public-Private Partnerships (PPP) in the health sector.

Question

The Chief Finance Director has asked you to critically examine the national PPP policy document and furnish him with key guiding principles on feasible PPP arrangements he can enter into.

Required:
Explain FIVE guiding principles that the Ministry should observe in the proposed PPP projects in the health sector.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Guiding Principles, PPP, Public Sector Finance, Public-Private Partnerships
Level: Level 2

Topic: Public Procurement
Series: MAY 2018

Question Tag: Public Sector Finance

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PSAF – May 2021 – L2 – Q4b – Public Sector Reforms

Feasibility analysis of primary health centre PPP project based on guiding principles and associated risks.

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PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance

NPV-based investment recommendation for Omidan Local Government among three projects and a risk-free security alternative.

You're reporting an error for "PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance"

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

You're reporting an error for "PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure"

PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles

Characteristics, structures, and steps for budgeting with National Chart of Accounts.

You're reporting an error for "PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles"

PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)

Discusses three benefits and two adverse consequences of Public-Private Partnerships (PPP).

You're reporting an error for "PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)"

PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector

Explain the steps for conducting Cost Benefit Analysis and Cost Effectiveness Analysis in public sector investment appraisal.

You're reporting an error for "PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector"

PSAF – May 2018 – L2 – Q5c – Public Procurement

Identify two financial risks in Public-Private Partnership (PPP) arrangements.

You're reporting an error for "PSAF – May 2018 – L2 – Q5c – Public Procurement"

PSAF – May 2018 – L2 – Q5a – Public Procurement

Explain five guiding principles for Public-Private Partnerships (PPP) in the health sector.

You're reporting an error for "PSAF – May 2018 – L2 – Q5a – Public Procurement"

PSAF – May 2021 – L2 – Q4b – Public Sector Reforms

Feasibility analysis of primary health centre PPP project based on guiding principles and associated risks.

You're reporting an error for "PSAF – May 2021 – L2 – Q4b – Public Sector Reforms"

PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance

NPV-based investment recommendation for Omidan Local Government among three projects and a risk-free security alternative.

You're reporting an error for "PSAF – May 2021 – L2 – Q3b – Fiscal Policy and Public Finance"

PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure

Evaluation of investment projects using Profitability Index.

You're reporting an error for "PSAF – May 2024 – L2 – SB – Q6 – Government Expenditure"

PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles

Characteristics, structures, and steps for budgeting with National Chart of Accounts.

You're reporting an error for "PSAF – May 2024 – L2 – SB – Q4 – Government Accounting Concepts and Principles"

PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)

Discusses three benefits and two adverse consequences of Public-Private Partnerships (PPP).

You're reporting an error for "PSA&F – Nov 2019 – L2 – Q5b – Public-Private Partnerships (PPP)"

PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector

Explain the steps for conducting Cost Benefit Analysis and Cost Effectiveness Analysis in public sector investment appraisal.

You're reporting an error for "PSAF – Nov 2020 – L2 – Q5b – Performance Measurement in the Public Sector"

PSAF – May 2018 – L2 – Q5c – Public Procurement

Identify two financial risks in Public-Private Partnership (PPP) arrangements.

You're reporting an error for "PSAF – May 2018 – L2 – Q5c – Public Procurement"

PSAF – May 2018 – L2 – Q5a – Public Procurement

Explain five guiding principles for Public-Private Partnerships (PPP) in the health sector.

You're reporting an error for "PSAF – May 2018 – L2 – Q5a – Public Procurement"

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