Impact of Proper Financial Strategy on Project Prosperity
Babak Mohamadpour, Ehsan Mohammad-pajooh, Anita Sadat Khezri

The most prominent factor to achieve prosperity in mega-projects is payment method, which allows for an adequate cash reserve to inject into the project in case. Methods of payment are related to progress measurement (PMS) and forecasted cash flow, which are both determined in a preliminary project stage. This case attempts to indicate deficiency of the milestone (0/100) method, which caused negative cash flow in the procurement phase, whereas only this method is reliable for the employer to accept the contractor invoice. In this respect, the preliminary data analysis will be applied for normality and descriptive tests. Thereafter, an independent samples t-test should recognize the accuracy of the contractor’s claim due to negative cash flow as a result of significant differences between physical progress and former milestone methods. Hence, modified milestones are introduced to compensate the contractor’s negative cash flow which considers the employer’s interest as well. Results of this research are based upon data collected from one of the EPC contractors undertaking oil and gas refinery in the south of Iran.

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