The purpose of this qualitative, explorative descriptive study was to describe how registered nurses at a specific tertiary hospital perceive the annual performance appraisal. A sample of 20 registered surgical nurses working in the ten Surgical Care Divisions was purposively selected to meet the inclusion criteria. Data was collected through two focus group interviews with 10 participants each. The transcribed interviews were manually analysed according to Collaizzi‟s (1978) method. Findings were described according to six main themes, of which the last theme described the nurses‟ suggestions for improving the annual performance appraisal. The 15 sub-themes addressed, among other things, the process of conducting annual performance appraisals, scoring the performances, incentives, loyalty to the hospital, communication, and competency certification of registered nurses. Recommendations were made for developing guidelines to ensure a standardised process of annual performance appraisal and to involve all stakeholders in the review of the competency assessment certification process. / Health Studies / M.A. (Nursing Science)