Effectiveness of Internal Control Systems on the performance of Hospitality Industry Management. A Case of Moriah Hill Resort.

ABSTRACT: This research assessed the effectiveness of Internal Control Systems on the performance ofHospitality Industry Management using a case of Moriah Hill Resort. As independent variables, the researchassessed the effectiveness of five components of Internal Controls namely: Control Environment, RiskAssessment, Control Activity, Information and Communication, and Monitoring. For dependent variable, theresearch assessed: Occupancy, ADR (average daily rate), REVPAC (revenue per available customer), REVPAR(revenue per available room), Customer acquisition cost, and Retention rate. The research used a mix ofQuantitative and Qualitative approaches. The total population involved in this research is composed of 40employees of Moriah Hill Resort. Quantitative data was collected using a questionnaire designed in form of fivelevels Likert scale and was analyzed using IBM Statistics SPSS 23. The coefficient of reliability outlined byCronbach‘s Alpha was .943 or 94% meaning excellent reliability. Qualitative data was collected usingInterview. The research found that Control Environment component is effective (x̄= 3.74; σ= 0.237). RiskAssessment component is effective (x̄= 4.91;σ= 0.338). Control Activities component is effective (x̄= 4.59 σ=0.471). Information and Communication component is effective with (x̄= 4.94 σ= 0.234). Monitoringcomponent is effective (x̄= 4.87;σ=0.409). The key weaknesses of Internal Controls outlined by the research are:Lack of culture of Internal Rotation of duties affecting employees’ behavior (x̄=4.82); Poor application ofinternal barriers limiting access to Offices and Stores (x̄=4.88); Insufficient salary affecting employees’motivation (x̄=4.85); Poor professional trainings and poor trips that could increase skills among employees(x̄=4.90); Weak employees unwilling to work (x̄=4.82); Camera of security that do not cover all departments(x̄=4.92); Employing two different Security Companies at the same Hotel (x̄=4.93); and lack of external auditservices (x̄= 5.00).

KEY WORDS: Hospitality Industry, Hotel, Internal Control Systems, Management.