IMPROVEMENT OF METHODOLOGICAL TOOLS FOR ASSESSING THE DISCOUNT RATE OF INNOVATIVE PROJECTS

Lin Song

The article shows the role and importance of discounting to ensure the correct assessment of innovative projects. A critical analysis of the main methods for determining the discount rate has been carried out, such as the weighted average capital price method, the risk-free rate aggregation method and the premium for the industry risk of the project, the method of expert evaluation in its pure form. The author proposes a formula for estimating the modified discount rate of cash flows of an innovative project, which develops a methodology for determining the discount rate based on calculating the weighted average price of project capital (WACC). In contrast to the traditional method of the weighted average price of capital, the factors influencing the final value of the discount rate include the possible share of project capital attracted in virtual markets, the average cost of this kind of capital, coefficients of variation in profitability and the indicator of financial independence of an innovative project, considered in comparison with the industry average values of the same coefficients.

Keywords:innovations, innovative project, discounting, discount rate, weighted average price of capital, risk-free rate, project risk