Kinnear was appointed in June and handed responsibility for attracting talent to the north-east club yet the only major arrival at St James' Park was the loan signing of French striker Loic Remy from Queens Park Rangers.
"Joe has worked hard on numerous targets, particularly an additional offensive player," Pardew said on the club website.
"However some of the options that were available within our financial means were not as good as the players we already had and there is no point bringing in new players unless they can improve us and take us forward."
Former Wimbledon manager Kinnear, 66, arrived at Newcastle in controversial circumstances with many fans and the media questioning whether the Irishman's appointment would undermine Pardew's role at the club.
The official announcement that Kinnear had returned to the club, where he was manager for four months in the 2008-2009 season before suffering heart problems, came a day after a bizarre interview in which he made a series of gaffes, pronouncing the names of players and club officials incorrectly.
In the same interview he boasted about his contacts within the game and how he could "pick the phone up and speak to any manager in the league, any manager in all divisions."
Newcastle narrowly avoided relegation last season and have got off to a slow start in the new campaign, winning only one of their opening three league matches.
Pardew, however, struck an upbeat tone in analysing their transfer business.
"We did the majority of our business in the January window, signing five excellent first team players," he added.
"With the strong squad we have we should all approach the season in a positive, optimistic frame of mind."