| Title |
Stochastic Project Financing Analysis System(SPFA) for Construction |
| Authors |
Hwang Jae-Hoon ; Lim Tae-Kyung ; Lee Dong-Eun |
| Keywords |
Scheduling ; Cash-flow ; Probability and Statistic ; Simulation |
| Abstract |
This paper presents an automated tool called Stochastic Project Financing Analysis(SPFA) system which integrates both cash-flow analysis and simulation-based scheduling methods. SPFA automatically integrates CPM schedule data exported from P3 into it, computes the best fit Probability Distribution Functions (PDFs) of historical activity duration data, defines activity durations using the PDFs identified, simulates the schedule network, and computes deterministic and stochastic project cash-flows, plots the corresponding cash-flow diagrams and estimates the best fit PDFs of maximum overdraft and net profit of a project. It improves the reliability of project cash-flow analysis by effectively dealing with the randomness and/or uncertainties of the activity durations and costs rather than existing deterministic systems do. It increases the usability of the schedule data obtained from commercial CPM softwares, facilitates user to incorporate the contract terms involved with payment options, and effectively handles the variability of the maximum overdrafts and net profits by finding the best fit PDF of them. It is implemented as an easy-to-use computerized tool programmed in MATLAB. SPFA can make significant contribution to the field of quantitative analysis relative to project financing, because (1) it analyzes the effect of different distributions of activity durations and cost on the distribution of the maximum overdrafts and net profits, (2) the reliability obtained by the system is higher than deterministic cash-flow analysis system, (3) it simplifies the tedious and burdensome process involved in finding the PDFs of the many activity durations and cost, and (4) it is a welcome replacement for the deterministic assumptions used by existing project financing researchers and generates more accurate results. SPFA allows project manager to estimate the extent of cash-flow unbalance in a specific period by using both deterministic and stochastic analysis modes. Case studies verifies the usability and validity of the system in practice. |