Human resources are considered as important assets
and are different from the physical assets.
Physical assets do not have feelings and emotions, whereas human assets are subjected to various types of feelings and emotions. In the same way, unlike physical assets human assets never gets depreciated.
Therefore, the valuations of human resources along with other assets are also required in order to find out the total cost of an organisation. In 1960s, Rensis Likert along with other social researchers made an attempt to define the concept of human resource accounting (HRA).
Physical assets do not have feelings and emotions, whereas human assets are subjected to various types of feelings and emotions. In the same way, unlike physical assets human assets never gets depreciated.
Therefore, the valuations of human resources along with other assets are also required in order to find out the total cost of an organisation. In 1960s, Rensis Likert along with other social researchers made an attempt to define the concept of human resource accounting (HRA).
The American Association
of Accountants (AAA) defines HRA as follows: ‘HRA is a process of
identifying and measuring data about human resources and
communicating this information to interested parties’.
