Human resource accounting: From theory to practice

Abstract

The primary capital of a community is deemed to be expert and adept manpower, particularly in the current era. Nowadays, the upsurge of intense competition generated in markets and organizations has rendered manpower to be the vital and effective factor leading to the attainment of competitive advantage, the success of the organizations, and their superiority to their competitors. In order to make plans, make their decisions more effective, and augment the efficiency of their decisions, managers and investors are required to obtain information about the true value of human resources in their organizations. Regarding the paramount importance of the evaluation and measurement of manpower, considerable research, in the field of Human Resource Accounting, has been conducted so as to develop concepts and methods of human resource accounting. This study seeks to delve into the significant impact of human resources on the advancement of the organization, to present theatrical concepts of human resource accounting, and to investigate the obstacles hindering the implementation of human resource accounting. The results substantiate that the impediments pertaining to the process of collecting human capital data for the report, the weak points and failings of the current accounting systems, and the absence of a comprehensive model for appraising human resources are the major influential factors obstructing the implementation of human resource accounting.