(b) Up 2 marks for each developed point about any errors, assumptions or omissions identified in the CDMS investment appraisal:

– Inherent unreliability of cash flow forecasting
 – Optimistic assumption of early year benefits
 – Assumption of constantly accruing benefits
 – Assumption that maintenance and support would be paid for in one year
 – Assumptions around constancy of the CDMS operating costs
 – Including finance costs when discounting by WACC
 – Impact of capital allowances on cash flows

(Up to a maximum of 10 marks in total)