Effects of remuneration on financial performance: The case of Ghana water company limited in the ho municipality

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This study investigates the effect of staff remuneration on financial performance using the Ho Municipal Directorate of the Ghana Water Company Limited (GWCL) as the case study. The research uses the staff perception of the capacity of the Municipal Directorate to generate revenue more than its expenditures as a proxy for financial performance. The study has specifically sought to examine the components of staff remuneration and identify some relevant factors that influence remuneration and financial performance of the company. It finally, estimates the effects of staff remuneration on its financial performance using the probit model. The study has found that one of the most important factors that affect remuneration of the employees are the failure to meet revenue generating targets, increased cost expenditure and lack of funds. Further, the results have shown that the longer the years an individual staff works with the company the greater it costs the company and so it has a negative effect on the financial performance. Moreover, the company’s assets and capacity to increase revenue collection has a positive effect on its financial performance. This means that if the company increases its assets and capacity of revenue collection, this could increase its financial performance. In the same way, challenges with revenue generation could lead to a significant negative effect on its financial performance. Nonetheless, when revenue targets are met, the financial performance of the company increases significantly. Finally, the study recommends that the management should focus on resolving the issues of giving more training to the staff on revenue generation as well as educating the public on prompt payment of bills. The company is also urged to motivate its staff and provide them with all required logistics for revenue collection in order to enhance the value of revenue generated, which can lead to improving staff remuneration and financial performance of the company.
A thesis submitted to the institute of distance learning, Kwame Nkrumah university of science and technology in partial fulfillment of the requirements for the degree of Master of science in accounting and finance