CAPITAL BUDGETING PRACTICES IN FOREIGN COUNTRIES: CASE OF TURKISH CONSTRUCTION FIRMS

The purpose of the study is to analyze the capital budgeting practices of turkish construction firms which are operating in foreign countries. a survey form has been prepared with caring of the studies in literature. it is applied to 120 firms which are registered to turkish contractors association. in the study, 39 completed survey forms are used. findings from the study; the most popular project evaluation technique is internal rate of return. planning programming is the most popular technique in mathematical models. calculating the cost of capital, firms commonly use cost of debt. it is determined that most of the firms do not make any adjustment in the cost of capital for foreign investments. considering the risk, adjustment in cash flows is the most popular technique. measuring earnings from foreign investments, firms commonly use expected accounting profits after foreign taxes, regardless of currency. furthermore, measuring cash flows, firms commonly use count all expected cash flows to turkey after domestic and foreign taxes, regardless of currency.