Benefits and return of investment of doing Annual Appraisal and increments?

I would like to know benefits and return of investment of doing Annual Appraisal and increments once a year and not as per individual completes his/her 1 year with company. I have seen many companies do salary increments as per anniversary of an individual with company. Please provide your inputs, suggestions.
Thanks

Many companies (as you mentioned above) that undertakes salary increments according to appointment date of the employees are most of the time SMEs. As in large organizations, salary increments are taken up on a fixed period - April, January etc.
The obvious reason that I can see to take up individual increments is -
1. It suits the employer /owner as it doesn't stress his budget /funds flow.
2. Employees tend to compare their increments with others. In such case, he can't compare. So it doesn't affect his work nor his responsibilities which is beneficial to the organization.