A Study On The Investment Risk Management Of The A Mixed Use Project

Local government financing platform is the product of the influence based on China’s historical financial system.The number and scale of platforms have increased rapidly,and the scale of hidden debts which belong to local governments are huge after about 30 years of development.In order to guard against local financial risks,the government has successively issued documents such as the Budget Law and National Development and Reform Commission(2014)No.43,which stipulates that local governments can only issue government bonds for financing and separate the financing behavior of local financing platforms from local governments.At the same time,the Ministry of Finance issued a series of regulations,such as Financial Treasury(2015)No.83 and Finance Forecast(2015)No.32,which defined the issuing mechanism of local government special bonds.In order to implement the proactive fiscal policy,the scale of local government special bonds is increasing,which has become an important source of funds for local government financing platform project investment.N City Investment Company belongs to the local government financing platform company managed by S City State-owned Assets Supervision and Administration Commission,and is the main construction unit of public welfare projects in S City.The construction projects undertaken in the past are basically "agent construction".A fixed proportion of agent construction fees are charged according to the actual investment cost,the project focuses on compliance management,and the experience and ability in project investment risk management are very lacking.Therefore,this study selects the government special bond A mixed use project with the largest investment,the most project functions and the most complex operational requirements of N City Investment Company as a typical case to study the investment risk management of government special bond project.First of all,this study introduces the investment situation of A mixed use project from several aspects,such as the structures of the company and its investment business,the budgets and construction details of A mixed use project,and the repayment ability of it as well.Secondly,the investment status has been listed.The repayment ability of the project is calculated based on the investment budget of the project,and the sensitivity analysis method is adopted to analyze the impact of the project on the repayment ability of the project in the case of declining operating income and rising operating costs.Then consulting company is invited to recognize and evaluate the risks of the project.After evaluating the risks from the perspective of financial analysis,we should deal with the investment risk of it according to the current institutional process of N City Investment Company when the risks are acceptable.Thirdly,the optimization scheme of investment risk management is put forward.The WBS-RBS method and expert interviews are employed in the risk identification step.Expert interviews are conducted on the basis of identification,and a risk evaluation index system of 12 key risk factors in 4 categories is constructed.Besides,the analytic hierarchy process is adopted to calculate the weight of the key risk factors.The fuzzy comprehensive evaluation method is adopted to determine that the A mixed use project as a whole unit has medium risk at last.The key risk points with medium risk are investment attracting risk,project positioning risk,project investment estimation risk,design risk,bidding risk,visa change risk,contract risk and market risk.Finally,the study puts forward some suggestions to improve the project risk response according to the results of the risk assessment.This study holds that in the project decision-making stage,the A mixed use project using government special bonds should introduce operating companies to participate in project decision-making,reserve room for adjustment,make a good project investment budget,and reasonably determine the scale of bonds;In the project preparation stage,we should clearly define the design objectives,carry out quota design,optimize bidding documents,and prompt the quality of bidding.In the project implementation stage,the whole process follow-up audit of the project and the demonstration of internal and external experts should be carried out;In the project operation stage,extensive research,comparison and selection of multiple schemes,and reasonable investment schemes should be set up.The detail of the contract should be optimized and the reward and punishment mechanism should be refined also.Quit rules needs to be specified.Epidemic prevention and control need to be done carefully.And increasing the plan of business outdoor will make the income more delightful.