The role of accounting in evaluating the key performance indicators used by a Maltese casino

Abstract

PURPOSE: This study identified and evaluated the current use of KPIs in a Maltese casino, whilst taking into consideration the role of accounting in measuring these KPIs. Besides, the benefits and drawbacks arising from the use of KPIs in the case casino, were also analysed and assessed. DESIGN: A qualitative methodology was implemented for this study. A case study approach was taken where several interviews were conducted in pursuance of the objectives of the study. In total, 13 interviews were carried out: 9 with departmental managers, 1 with the Financial Controller, and the rest with high ranking officials. FINDINGS: It emerged that KPIs encompass a mixture of both financial and nonfinancial measures. Moreover, KPIs varied from one department to another, which are linked at top management level. Nevertheless, the identified KPIs were in line with those expected to be used in the gambling sector. Introduction of new KPIs proved to be difficult, since table games have remained unchanged since their development. Numerous benefits of KPIs emerged such as enhanced decisionmaking. In fact, these outweighed the drawbacks which result from KPIs. Apart from the preparation of the monthly management accounts, annual budgets and the annual set of financial statements, the Finance department are further responsible to prepare monthly tax liabilities reports which are to be submitted with the MGA on a monthly basis. CONCLUSIONS: Performance measurement systems, more specifically, the use of KPIs were deemed crucial for the success of the case casino. Thus, the process involved in assessing and evaluating KPIs should be given great importance. In this regard, the case casino might consider creating a new position within the organisation specifically dealing with KPIs. VALUE: Given the impressive growth reported by the gambling industry coupled up with lack of research, both locally and internationally, this study demonstrated the current KPIs along with their benefits and drawbacks. Moreover, this study provided several recommendations.