If we are only using the Financial Summary or detail Cost Plans, how is this field used? Can someone point me to the proper documentation? Thanks.
Can you please clarify if you are referring to the Annual Total Cost of Capital% field that appears on the Financial Management Defaults page under the Administration>Finance>Setup menu? If yes, then you can find some information about this field in the Set Capital Cost and Reinvestment Rate for the System topic under "Create Financial Summaries" at the following docops sites:
Create Financial Summaries - CA PPM - 14.3 - CA Technologies Documentation
Create Financial Summaries - CA PPM SaaS - 14.3 - CA Technologies Documentation
Let us know if this information does not answer your questions adequately. I am also following up on this with SMEs and will get back to you with any further details that I can find out.
After following up with an SME, I found out that the Total Cost of Capital % field at the system level is used for financial metrics such as NPV. It is not used for cost plans. Please refer to our documentation on financial metrics here: Create Financial Summaries - CA PPM SaaS - 14.3 - CA Technologies Documentation
Check out the topic "Determine the Financial Metrics for Planning".
I hope this helps.
Displays the Modified Internal Rate of Return or the rate used to measure the attractiveness of this investment. Use MIRR as part of a capital budgeting process to rank various alternative investment choices. While IRR assumes the cash flows from an investment are reinvested at the IRR, the MIRR assumes that all cash flows are reinvested at the cost of capital.
Besides MIRR, the Total Cost of Capital value is also used in the NPV metric to compute the cash flow. This is mentioned in the NPV metric definition in the docs.