Comment on the following scenario:
The use of NPV at Rolls-Royce
In its 2006 annual report and accounts, Rolls-Royce plc stated that: The Group continues to subject all investments to rigorous examination of risks and future cash flows to ensure that they create shareholder value. All major investments require Board approval. The Group has a portfolio of projects at different stages of their life cycles. Discounted cash flow analysis of the remaining life of projects is performed on a regular basis.