«Journal of Finance & Economics Volume 1, Issue 3 (2013), 39-50 ISSN 2291-4951 E-ISSN 2291-496X Published by Science and Education Centre of North ...»
5. Discussion The discussion for this paper was based on the result obtained from test of the null hypothesis (H01) which states that budget target setting is not an effective tool for performance evaluation in the hotel industry in Kaduna State. The responses generated from question 11in the questionnaire was used for analysis and presented in table 2 below.
Table 3 above shows the computed expected frequencies in brackets against the observed frequencies as obtained from the responses gathered on question 11 of the questionnaire.
Source: Researcher’s computation, 2013 The calculated value of x2 = 15.56 while, for 6 degrees of freedom and 5% level of significance the critical value is 12.6. Based on the decision rule, the calculated value of x2 is greater than the critical value and therefore, the null hypothesis (H0.1) which states that budget target setting is not an effective tool for performance evaluation in the hotel industry in Kaduna State is hereby rejected and the alternative hypothesis (HA.1) accepted. This result is consistent with Mohammed (2009) and Fisher et al. (2002) that budget target setting is a mechanism for effective performance measurement in a firm.
The conclusion drawn from the findings of this study are as follows:
1. Budget coordination and control procedures of the hotels in Kaduna state are not very effective.
2. The budget target setting of the hotels in Kaduna State is not well articulated and therefore, lacks very clear focus. The current situation in respect of yardstick for performance appraisal is that it doesn’t exist in some hotels while what obtains in some could not be definitely described.
3. The targets or goals set for individuals and units to achieve through budgeting process could be a veritable management tool for measuring performance and efficiency in the hotel industry in Kaduna State.
Based on the conclusion of the study as presented above, the following measures are recommended:
Firstly, there is an urgent need for them to strengthen the process of budget formulation and implementation. Additional efforts are required from managements of hotels in Kaduna State to 48 © Science and Education Centre of North America Journal of Finance & Economics www.todayscience.org/jfe Vol. 1, Issue 3, 2013 ensure that diligence, due process, commitment and discipline are brought to bear on the entire processes of budgeting and budget control in order to achieve the maximum benefits inherent in successful budgeting and control exercise.
Secondly, budget guidelines and goals should be properly articulated, coordinated and communicated to all individuals and units Thirdly, management of the hotels situated in Kaduna State should adopt the level of budget target achievement as basis for performance and efficiency measurement. This is in line with the conclusion of the study that budget target setting is an effective management tool for performance evaluation on individuals and units. The adoption of this recommendation could lead to increase in subordinates efforts and task performance.
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