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BUDGETARY CONTROL AND SERVICE CHARGE MANAGEMENT PERFORMANCE IN REAL ESTATE SECTOR: AN EMPIRICAL STUDY OF THE MOTIVATIONAL ASPECT

Asian Economic and Financial Review 04/2013; 3(6):749 - 761.

ABSTRACT Most Real Estate Property Management Companies (PMC) in most cases struggles with service charge funds (SCF) to provide amenities for tenants living in their serviced apartments after budget has been carefully prepared and approved and payments made by occupants. This paper investigated the effect of motivational aspect of budgetary control on the service charge management performance in PMCs in Nigeria. The sample frame consists of 4 major PMC with 380 staff stratified into two groups - group 1 (Luxurious) and group 2 (commercial). The sample size is made up of 95 staff representing 25% of the frame selected at random. Data was collected through structured questionnaire and analyzed. Z-test was used for hypotheses confirmation. Findings proved that budgetary control has significant influence on workers motivation which leads to savings in the service charge expenditure but not effectively employed in the subsector hence the inefficiency in Service charge expenditure (SCE) management. The study recommended that budgetary control should be intensified to motivate employees to embark on service cost minimization to gain savings or at least achieve a state of breakeven. This will promote tenancy relationship in the managed estates and the achievement of PMC financial objective.

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Jun 3, 2014