Development Of Human Resource Accounting (HRA) In India

Abstract

Human Resource Accounting is a process of classifying, budgeting, and conveying the investment and cost of human resources incurred in the organization including wages & salaries and training expenses that are presently not included in or disregarded in the calculation or accounting practices. The main concept behind Human Resources Accounting is to estimate and project the worth of the human capital and the value generated by them. Just like physical assets like plant and machinery, land, building are estimated and recorded in the books of account, on similar lines, the human resources should also be calculated and recorded and disclosed in the financial statements. This paper elaborately discusses about the objectives, statutory provisions governing human resource accounts, significance, advantages, limitations methods and process of HRA to examine these issues and challenges and lastly, to give suggestions based on the findings of the study.