Importance of Human Resource Accounting
Importance of Human Resource Accounting:
Human Resource Accounting provides useful information to the management, financial analysts and employees as stated below: a) Human Resource Accounting helps the management in the Employment, locating and utilization of human resources. b) It helps in deciding the transfers, promotion, training and retrenchment of human resources. c) It provides a basis for planning of physical assets via-à-vis human resources. d) It assists in evaluating the expenditure incurred for imparting further education and training in employees in terms of the benefits derived by the firm. e) It helps to identify the causes of high labor turnover at various levels and taking preventive measures to contain it. f) It helps in locating the real cause for low return on investment, like improper or under-utilization of physical assets or human resource or both. g) It helps in understanding and assessing the inner strength of an organization and helps the management to steer the company well through most adverse and unfavorable circumstances. h) It provides valuable information for persons interested in making long-term investment in the firm. i) It helps employees in improving their performance and bargaining power. It makes each of them to understand his contribution towards the betterment of the firm via-à-vis the expenditure incurred by the firm on him. j) A financial analyst is interested in understanding and assessing the inner strength of firm. Such inner strength does not merely depend on the physical assets owned and possessed by the firm. IT also depends upon the type of human resources available to the firm. The vigilant, dynamic and responsible management can steer the company well through most adverse and unfavorable circumstances. In case the human resources, specially the managerial resources at the disposal of the firm are impartially and systematically valued and disclosed in the financial
Human Resource Accounting provides useful information to the management, financial analysts and employees as stated below: a) Human Resource Accounting helps the management in the Employment, locating and utilization of human resources. b) It helps in deciding the transfers, promotion, training and retrenchment of human resources. c) It provides a basis for planning of physical assets via-à-vis human resources. d) It assists in evaluating the expenditure incurred for imparting further education and training in employees in terms of the benefits derived by the firm. e) It helps to identify the causes of high labor turnover at various levels and taking preventive measures to contain it. f) It helps in locating the real cause for low return on investment, like improper or under-utilization of physical assets or human resource or both. g) It helps in understanding and assessing the inner strength of an organization and helps the management to steer the company well through most adverse and unfavorable circumstances. h) It provides valuable information for persons interested in making long-term investment in the firm. i) It helps employees in improving their performance and bargaining power. It makes each of them to understand his contribution towards the betterment of the firm via-à-vis the expenditure incurred by the firm on him. j) A financial analyst is interested in understanding and assessing the inner strength of firm. Such inner strength does not merely depend on the physical assets owned and possessed by the firm. IT also depends upon the type of human resources available to the firm. The vigilant, dynamic and responsible management can steer the company well through most adverse and unfavorable circumstances. In case the human resources, specially the managerial resources at the disposal of the firm are impartially and systematically valued and disclosed in the financial