NPV computation is major criteria for project appraisal as it reflects that, the amount of cash flow generated from the project will be more than the cash invested and thus project managers give lot of impetus to it. Thus in order to generate positive cash flows project manager needs to analyze in department the project, the sectors or the industry where project is proposed, expertise in the respective field , competitors, demand analysis, governing industry law and key environmental issues. After proper understanding and study of the above issues fund manager analyze the financials of the company in terms of project cash flows, ratio analysis, Profit and loss account, balance sheet, net present value and Internal rate of return (IRR) and then take a final call on the same.