Full Investment Analysis Report

(for Asset Projects at Project Approval and

initial Expenditure Authority)

<Project Name>

<Location>

National Project Management System

Analysis Phase
Version: March 2019

Prepared by:

Date:

SIGMA number:

Table of Contents
 IAR Template – Project Approval

Executive Summary.......................................................................................................................................2
1. Problem/Opportunity Definition...........................................................................................................6
2. Background...........................................................................................................................................6
2.1 Project History.....................................................................................................................................6
2.2 Building Condition...............................................................................................................................6
2.3 Tenant Considerations........................................................................................................................7
2.4 Strategic Context.................................................................................................................................7
2.5 Stakeholders........................................................................................................................................7
3. Project Scope........................................................................................................................................7
4. Identification & Analysis of Options......................................................................................................8
4.1 Options Considered.............................................................................................................................8
4.2 Non Feasible Options..........................................................................................................................8
4.3 Feasible Options..................................................................................................................................8
4.4 Financial Analysis of Options...............................................................................................................8
4.5 Risk Assessment................................................................................................................................11
4.6 Conclusions.......................................................................................................................................12
5. Strategic Impact..................................................................................................................................12
6. Recommendation................................................................................................................................12
7. Approval Authority and Funding.........................................................................................................12
7.1 Cost Estimate and Cash Flow Table...................................................................................................13
8. Implementation Plan...........................................................................................................................13
9. Project Team, Approval and Signatures..............................................................................................13
10. Appendices......................................................................................................................................14

[Upon completion of editing, update Table of Contents as follows: Right click on grey area of table, select
‘update field’, choose ‘update entire table’, then press the ‘OK’ button. Page numbers will be automatically
updated.]

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 IAR Template – Project Approval

This template serves as a helpful tool for preparing an IAR. It does not replace the “Guide for the Preparation of
Investment Analysis Reports”. The template has been approved by National Portfolio Management and the 2009
Guide is currently in the process of being updated.
Note: Please attach (or copy) the Summary Cash Flow Table (from Real Property Project Funding and Cost Planning
Workbook). For any NPMS full project that is, or potentially may be, requesting capital funding (Vote 5, B141 or B143),
a betterment test is required to validate the funding. Choices include completion of the RP Project Funding and Cost
Planning Workbook for work in crown-owned buildings, or contacting Finance and Administration Branch (FAB)
directly for a manual betterment test for those projects with other “focuses” (i.e.: lease, engineering asset,
infrastructure, etc.).

Executive Summary
The purpose of the revised Executive Summary is to provide a brief overview of the most essential and relevant
information concerning the project for decision-makers. This summary will replace the Integrated Investment Plan (IIP)
Project Summary and should be written in a narrative sense, as opposed to using bullet points.

Project Description:

Instructions:
 In this section, start with a clear statement of the proposal that is being recommended for approval.
This includes the authorities requested (ex: Project Approval [PA]/Expenditure Authority [EA] or
amended PA/EA) and a brief definition of the project scope (ex: renovate/retrofit a building, undertake
base building modifications, replace a building component, bridge or dam, etc.), amount of space (m 2)
(as required), total project cost (ex: base building estimate and/or fit-up) and timing (ex: in-service
date/end construction date). The name(s) of the client department(s) must be identified, along with
relevant space requirements, if the project driver is a renovation/repairs to a Crown building that
accommodates clients being affected.

 As an example, use the following wording to begin the statement, as follows:

 For project seeking the first Expenditure Authority (EA1);
The project is seeking Project Approval in the amount of [insert amount and indicate amount
before taxes] and Expenditure Authority1 in the amount of [insert amount and indicate
amount before taxes]2, to [indicate purpose]. The in-service date or construction end date is
[insert date]. Expenditure Authority is being sought to proceed with the development of
design specifications and to obtain substantive cost estimates for EA2.
Note:
1
IARs requesting project approval should also identify the amount of expenditure authority, based on
substantive cost estimates.
2
For purposes of IIP inclusion, any fit-up amount should be aligned to line C and line D of the cash
flow table found under the Approval Authorities and Funding section of the Executive Summary.

Project Information

Project Background
 The purpose of this section is to provide the reader with the necessary background to fully understand
the investment situation.
 Provide brief history of the current project and the rationale for undertaking this project
(problem/opportunity statement). This should clearly define what factors or issues are driving the
initiation of the project and how the project will address these issues . For all projects, indicate
information on current location.

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 IAR Template – Project Approval

 Projects may be launched for a number of reasons such as: to maintain or improve an asset; Issues
related to insufficient effectiveness of a system; improving environmental performance; or to address an
urgent health & safety situation. Make reference to any portfolio planning considerations that may be
driving the requirement for the project. If applicable, comment on the urgency of the project (e.g.
current condition, if represents health and safety issues, components that are old and obsolete and why
the need to replace or repair etc.).

Project scope: [Please ensure project scope is well reflected in Callipers under “Activities covered by PCRA” ]
Instructions:
 Summarize and provide a brief description of the project scope and the key requirements that are
being addressed in this project.

 For asset-based projects involving existing assets:

 Provide information on the location of the asset, ensure to summarize any pertinent
information concerning the asset’s condition and performance, including identifying
other project requirements related to the asset.
 Identify all the requirements (generally technical requirements) related to the building
components or systems that will be replaced, upgraded or repaired.
 Identify if the requirements were identified in the Building Condition Report, Asset
Management Plan or Building Management Plan.

 Identify any dependencies and impacts (previous project approvals, branches, other projects,
contracting, legal, announcements, communications, etc.) that are dependent on the outcomes of
this project or whether this project is dependent on the outcomes of another project. [Ensure
consistency with Callipers (questions 58 and 59)]
 Indicate any special issues that need to be brought to the attention of decision-makers. These issues
may pertain to level of urgency, health & safety, risk management, potential political considerations,
timing, legal issues, , and issues regarding the department’s sustainable development targets,
heritage conservation considerations or areas of public sensitivity with respect to the project.
Options considered and a brief description of option selected with justification:
Instructions:
 Identify and list the options that were considered (non-feasible and feasible options) and analyzed.
Illustrate the results of the financial analysis in the form of a table showing the PVCOA and the risk-
adjusted PVCOA (if calculated) for each feasible option.
 Feasible
 Option 1 (Present Value Cost $XXM – construction cost $XXM)
 Option 2 (Present Value Cost $XXM – construction cost $XXM)
 Non-feasible
 Option 3
 The selected option should include a concise statement that explains the rationale for selecting the
recommended option. The recommendation should be based upon the financial, non-financial and
risk factors that contribute to making this the best value approach.
 As per the TBS-PSPC IIP Protocol, please complete the table (below) and indicate whether Minister
Engagement for the project is required.
Criteria for Minister Engagement: Yes* ☐ No ☐ (check one)
Yes/ Notes
No #

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 IAR Template – Project Approval

1 The project, or others associated to it, is likely to attract negative media coverage.
2 The project is part of a government-wide initiative.
3 The project is related to observations from OAG.
4 The Minister has shown interest or has been briefed on this project or others of a similar
nature in the past (e.g. Minister briefings, TB submissions, speeches, etc.).
5 The project has significant security considerations.
6 The project is high risk or high dollar value.
Note 1:
Note 2:
* Yes indicates that the Minister may require a briefing on the project as per governance.

Approval Authorities and Funding:

Instructions:
 Provide the PCRA rating level with a score of [%] for the project,
 Identify the appropriate delegated authority required for project approval,
 Indicate if there is a requirement for a TB Submission for Contracting Authority (CA) (ex: CA for
design/CA for construction) and/or to access new funding. (e.g.: table below or similar)
Table No.
Item Amount Approval Authority
PA $X,XXX ADM, RPS

CA $X,XXX Treasury Board

PCRA/IIP Level 2 RPIB

 State the class of cost estimate (e.g. indicative or substantive). For projects seeking expenditure
authority, it must be stated that substantive cost estimates have been provided.
Project cash flows:
 Provide cash flow by budget year in current dollars for one-time costs (e.g. fit-up/base building) using
the IIP table provided below. GST/HST are shown separately. Fill in yellow cells only and answer
whether it is funded (Y/N), others are formulas.

 Identify the source of funding (e.g. Vote 1, Operating B123, Vote 5 - Capital B141 and/or Fit-up B143)
and OGD direct (client) costs. (Note: Non-FFE – OGD reimbursed via Revolving Fund line (table
below) refers specifically to fit-up construction costs related to SPS, non-compliant or other fit-up
requirements).

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 IAR Template – Project Approval

Project Construction costs (for IIP inclusion)

IIP Investment Period (in thousands of dollars)
Funded Previous
Categories Total Cost
Y/N Years 2017/18 2018/19 2019/20 2020/21 2021/22 Total 5-Years

PSPC Vote 1 - Operating (B123)

- - - - - - - -

PSPC Vote 5 - Capital (B141)

- - - - - - - -

PSPC Vote 5 - Fit up (B143)

- - - - - - - -

Total Vote 1 and 5 (before taxes) (a)

- - - - - - - -

Non FF&E - OGD reimbursed via Revolving Fund (b)

- - - - - - - -
Total Project Construction Cost (before taxes) (c) = (a) +
(b) - - - - - - - -

Taxes (GST, HST, PST)

- - - - - - - -
Total Project Construction Cost (incl. taxes) (d) = (c) +
taxes - - - - - - - -

FF&E (OGD reimbursed via Revolving Fund or directs costs,

before taxes) = e
- - - - - - - - -

Total Project Construction Cost (Project Construction

Cost before taxes + FF&E) (f) = (c) + (e)
- - - - - - - -

Project Risks
Instructions:
 Using the table (below), provide a brief description/risk statement, indicate the risk assessment/risk
level, and summarize the mitigation measures to effectively manage those risks.
 This information should be in line with the risk management plan. Use same terminology as in Risk
Management Plan for Risk Statements, Assessment and Response.

 Identify the key risks associated with the implementation plan for the recommended option. These
risks are typically the highest risks identified in the Risk Management Plan.
 Indicate the risk allowance being requested for project implementation. This would be the sum of
residual risk indicated in the Risk Management Plan.
Risk Allowance Requested: $ XXX
Highest Risk Statements Risk Risk Response
Assessment

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 IAR Template – Project Approval

1. Problem/Opportunity Definition
1. Key Issues (factors driving the initiation of the project)
- Maintain or improve asset
- Issues related to insufficient effectiveness of a system
- Improving environmental performances
- Client Requirements
- Possible Opportunity

- Emergency situation
2. Previous approvals, decisions or agreements:
- Regional Investment Management Board decision (RIMB)
- Real Property Investment Board (RPIB)
- Treasury Board approvals (TB)
- Cabinet or Ministerial decision

- Interdepartmental agreement

Note: This section should not include any indication of the proposed solution. Its purpose is to concentrate
on what drives the project.

2. Background
2.1 Project History
1. Short history

- Relationship to other projects or programs (if applicable)

2. Compliance with NPMS

- Substantially completed Identification close out document (to be included as an appendix)

2.2 Building Condition

1. Brief description of the building
- Age, area, location, main characteristics, classification of the building, building owner
- Environmental performance assessment (BOMA BESt, LEED, etc)
- Heritage considerations

- Strategic value of asset

2. Future plans for use of asset

3. Overall condition information from Building Condition Report, Properties Facilities Management, Building
Management Plan, Asset Management Plan etc. (if applicable)
- Building systems (Architectural, Structural, Fire Alarm System, Interior Condition, Mechanical
Systems, Electrical Systems, Indoor Air Quality, etc.)
- Limitations
- Recent renovations
- Facility Condition Index (FCI) (if applicable)
- Upcoming requirements
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 IAR Template – Project Approval

- Operational, financial, environmental and functional performance

- Project related problems and impacts
- Accessibility
- Impact of current problem on tenants (if applicable)

2.3 Tenant Considerations

- List the Occupants
- Type and amount of space occupied in form of a table (if appropriate)

Client Type of space m2u m2r Occupancy

instrument (OI) Expiry
Date
X Storage 473.9 494.3 August 31, 2016
Y Office 2,744.0 2,982.6 December 31, 2017
SPS 774.3 807.5
Z Office 6,900.0 7,495.1 September 30, 2018
10,892.2 11,779.5
- Information on client changes, movement, issues, etc. (if applicable)

2.4 Strategic Context

1. Describe how the problems/opportunities relate to current strategies and plans, such as:
- National Investment Strategy (NIS)
- Regional Investment Strategy (RIS)
- Community Based Investment Strategy (CBIS)
- Portfolio Strategy
- Strategic Action Plan
- Asset Management Plan
- Building Management Plan
- Client Strategy (Explain the client’s long-term and short-term accommodation strategy, if applicable)

2. Meet with the Portfolio Management Sector, Owner Investor Analyst, Asset Manager, Accommodation
Manager and any other relevant stakeholders to ensure that all necessary background information is
included; any additional directives from upper management, priorities, budget cuts, strategic and
operating review, etc.

2.5 Stakeholders
(Relevant groups who may be implicated in the problem/opportunity)
1. List all the relevant stakeholders who have an involvement in the problem/opportunity

2. Briefly describe their stake

3. Project Scope
1. Requirements
- Must identify all the requirements (generally technical requirements related to building components
or systems that will be replaced, upgraded or added)

- Identify if the requirements were identified in the BCR, AMP or BMP

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 IAR Template – Project Approval

2. Highlight any special issues/requirements relative, but not restricted to the following:
- Technical requirements
- Level of urgency
- Health and safety
- Environmental requirements
- Sustainable Development Strategy requirements
- Requirement based on a current strategy
- Policy requirements
- Timing requirements
- Security requirements
- Accessibility requirements
- Requirement to address the condition of the Asset
- Heritage building
- Client requirements

- Other requirements

4. Identification & Analysis of Options

The information in the following section should only summarize the key findings of the Feasibility Report and
should be updated, if applicable.

4.1 Options Considered

- Identify and describe all reasonable options for satisfying the project requirements

4.2 Non Feasible Options

- Clearly explain why the eliminated options are not considered for further analysis

4.3 Feasible Options

- Clearly explain why the retained options are being considered for further analysis

4.4 Financial Analysis of Options

Note:
- This section summarize the non-financial analysis of the Feasibility Report, except that a cost estimate
and schedule of work for each option analyzed must now be included.
- Status Quo option must always be fully analyzed. For asset projects, Status quo is the option of
maintaining the asset as-is, with minor repairs when necessary. The estimated project cost for this option
is the average maintenance cost per year.

1. Description of options:
Option 1: Status Quo
- Scope: Clearly explain the details of this option (what they consist of) and its limitation
Option 2
- Scope: Clearly explain the details of this option (what they consist of) and its limitation
- This option includes/excludes:
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 IAR Template – Project Approval

- Additional scope of work (compared to Option X):

Option 3
- Scope: Clearly explain the details of this option (what they consist of) and its limitation
- This option includes/excludes:
- Additional scope of work (compared to Option X):

2. Advantage and Disadvantage and Cost/Schedule Estimate Table. For example:

Options Advantages Disadvantages Cost & Schedule
Option 1: - Disruption: No added - Codes and Standards: Does not - Cost Estimate:
Status Quo disruptions to elevator service address non-compliance with $XXXX (average cost
by removing elevators from current barrier free design, B44 of maintenance
service for upgrading. Elevator Safety Code, and safety repair, and/or any
bulletin from Technical opportunities cost if
Standards and Safety Authority applicable)
- NPV if applicable
- Future maintenance: Increased
capital and maintenance costs - Schedule (start and
due to the replacement of completion)
obsolete components of the
existing control and drive
systems.
- Tenant satisfaction: Continued
tenant dissatisfaction regarding
elevator service and reliability
including numerous shutdowns
and entrapments.
Option 2: - Health and Safety: The elevator - Disruption: Disruption to - Cost Estimate:
Upgrade to system will have a significant elevator service, as one elevator $XXXX (Total project
Comply With overall improvement to the level at a time will be down for cost estimate,
Current B44 of safety. approximately four to five weeks current dollars,
- Codes & Standards: Full for upgrading. Class D, including
Elevator
compliance with current barrier - Tenant Satisfaction: No GST/HST of $XXX)
Safety Code free design, B44 Elevator Safety improvements in elevator - NPV if applicable
Only Code, and safety bulletin from service or reliability. - Schedule (start and
Technical Standards and Safety - Future modernization: completion)
Authority. Approximately 15-20% of this
work (and costs) would become
redundant when a major
modernization is carried out in
the near future.
- Energy Efficiency: No energy-
related savings as the original
drive and control equipment
would be retained.
Option 3: - Health and Safety: The elevator - Recapitalization Project: Staging - Cost Estimate:
Complete system will have a significant and timing of other projects $XXXX (Total project
Elevator overall improvement to the level within the complex may incur cost estimate,
Modernizatio of safety. revisiting, upgrading or changing current dollars,
- Codes and Standards: Full some base building which form Class D, including
n
compliance with current barrier part of this project. GST/HST of $XXX)
free design, B44 Elevator Safety - Disruption: Longest shutdown - NPV if applicable
Code, and safety bulletin from time for each elevator. One - Schedule (start and
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 IAR Template – Project Approval

Technical Standards and Safety elevator at a time will be out of completion)

Authority. service for approximately 12
- Long-Term Solution: Completely weeks.
refurbished custom cab interiors
that should not require
refurbishing for another 10-15
years.
- Tenant Satisfaction: Significant
improvement in elevator service
and waiting times with the
installation of microprocessor
based computerized controls
and dispatching as well as
increased system reliability.
- Energy Efficiency: Elevator
energy savings of approximately
40% with the installation of solid
state motor drives and
permanent magnet alternating
current gearless drive machines.

- Some examples of advantage/disadvantage that can be used:

- Project requirement satisfaction
- Strategic compatibility (Long Term Vision and Plan, NIS, RIS, AMP, CBIS etc.)
- Impact on diversity or balance of the inventory
- Timing requirements respected
- Support goals and objectives of PSPC Sustainable Development Strategy
- Client requirements satisfaction
- Suitability of accommodation
- Health and Safety
- Seismic/Code
- Conservation of Heritage Value
- Continuity of Operations
- Flexibility
- Disruptions to tenants
- Accessibility
- Federal presence
- Good Neighbour Policy

- Environmental factors
- Aboriginal considerations
- Cost

3. For projects that require National approval, also use an “Evaluation Matrix for Qualitative Analysis”
- Each factor should be explained
Non-Financial Weight Option 1 Option 2 Option 3
Factor
Score Score Score
Factor 1 30 30 27 30
Factor 2 25 22 25 25
Factor 3 20 17 10 16
Factor 4 15 15 5 12

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 IAR Template – Project Approval

Factor 5 10 8 6 6
Total Score 100 92 73 89
Note: not applicable if there is only one feasible option.

4. Description of results of analysis and conclusion reached for each factor (must justify ratings)

4.5 Risk Assessment

1. Evaluation of relative level of risk for each option as applicable (Evaluation Matrix for Risks)

Option 1 Option 2 Option 3

Risk Factors
L I Score L I Score L I Score
Client requirements not being met M M 4
Changing client requirements L L 1
Timing delays L H 3
Cost increase L H 3
Negotiation risk L L 1
Market conditions L L 1
Funding M M 4
Lack of human resources L L 1
TOTAL SCORE 18
Note 1: Table not applicable if there is only one feasible option.
Note 2: For project requiring National approval, a 5x5 matrix (Very High-High-Moderate-Low-Very Low) is
necessary.
Legend:
High (H) 3 3 6 9
Impact (I)

Moderate (M) 2 2 4 6
Low (L) 1 1 2 3
1 2 3
Low Moderate High
(L) (M) (H)
Likelihood (L)

2. Examples of other risk factors relevant to each option

- Risk that the project may not fully rectify an identified problem
- Risk of user needs not being met
- Risk of changing requirements
- Risk of not meeting timing requirements
- Risk of cost overruns
- Risk of future performance being impaired
- Risk of environmental degradation
- Risk of exceeding approved funding
- Risk of Base building System Failure
- Risk related to Indoor Air Quality (IAQ)
- Risk related to Fire Code Requirements
- Risk related to a request for Non-Compliance
- Risk of Political Pressure
- Risk of client commitment to the project

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 IAR Template – Project Approval

- Risk of changing priorities in the Federal Government or Department

- Other related risks

3. Explanation of the evaluation matrix per risk:

- Description of results
4. Conclusion of risk assessment :
- Which option carries lowest level of risk? How does each option rank in terms of risk?
- Do any of the options carry an unacceptable high level of risk?
- Briefly summarize key findings from the evaluation matrix

4.6 Conclusions
- Combination of results of all analysis (determine which option provides the overall best value to the
federal government)
- Considering results, what conclusions can be reached?
- State why preferred option is better than the other options available
- Convey through the conclusion that the recommended option represents “best value” to the Crown,
particularly when it may not be the “least cost” option
- Convey the risks of not proceeding with the recommended option to further articulate the need to
implement the recommended option

5. Strategic Impact
1. Identify strategic value of proceeding with the project
2. Demonstrate project is carried out in a manner consistent with departmental policies and strategies.
3. Use checklist of strategic and policy compliance table below. Apply it specifically to each individual
project:
Compliance Justification
Policy/Strategy
Yes No (always required)
Asset/Building Management Plan
Sustainable Development Strategy
Good Neighbour Policy (if applicable)
Community-Based Investment Strategy
Regional Portfolio Strategy

6. Recommendation
Maximum length of 2 paragraphs
1. Clear and detailed statement of the proposal being recommended for approval.
- Project definition
- Cost (GST/HST, Class of estimate, Expenditure authority, Risk allowance)
- Timing
2. Comments on urgency of project
3. Issues to be brought to the attention of RPIB or RIMB (decision makers)

7. Approval Authority and Funding

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 IAR Template – Project Approval

1. PCRA Score
- Date when included on IIP list
2. Identify Delegated Approval Authority (DG, ADM, Deputy Minister, TB)
3. Source of funding (including client funding, if applicable)
4. Expenditure authority of $ XX for project planning and design
5. CPBN no: XXXX

7.1 Cost Estimate and Cash Flow Table

  2017/2018 2018/2019 2019/2020 2020/2021 Total
Project Cost $ $ $ $ $
Risk allowance $ $ $ $ $
Sub-Total $ $ $ $ $
Escalation $ $ $ $ $
GST/HST $ $ $ $ $
Total $ $ $ $ $
See detailed cost breakdown in Appendix

8. Implementation Plan
1. Explain the implementation tasks and activities, including engineering surveys, planning studies and
other documents that are required to move the project forward
2. Include project schedule
- Key milestones for project
- Timing to take project to Expenditure Authority for project implementation
- Anticipated completion date

- Provide detailed project schedule attached in appendix

3. Risk Management Plan (attach as appendix)

- Identify key risks including summary of risk mitigation measures only for the recommended option

9. Project Team, Approval and Signatures

Position (examples) Organization Name
Project Director
Senior Project Leader
Senior Project Manager
Project Manager
Prof. and Tech. Resources
Senior Financial Advisor
Property Manager
Other (specify)

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 IAR Template – Project Approval

Action Date Signature

Prepared by

Reviewed by

Recommended by

Approved by

10. Appendices
Below are examples of items that could be included as an appendix to the IAR:
1. Identification close out document
2. Risk Management Plan
3. Detailed project costs/Cash Flow Tables
4. Summaries of building condition and building performance
5. Canadian Environmental Assessment Act, Environment Assessment Report
6. Project Sustainable Development Strategy with targets
7. Project Implementation schedule
8. Communication Strategy
9. PCRA Summary Sheet

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