rani [Recovered]

PRESENTATIONON : 

PRESENTATIONON HUMAN RESOURCE ACCOUNTING

Meaning of HRA : 

Meaning of HRA HRA mean measuring & recording the cost & value of human resource of an organisation. it is not only a system of accounting for the cost & value of the people to an organisation .

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Human Resources accounting, also known as Human Asset Accounting, involved identifying, measuring, capturing, tracking and analyzing the potential of the human resources of a company. It was a method by which a cost was assigned to every employee when recruited, and the value that the employee would generate in the future. .

What is human resource accounting? : 

4 What is human resource accounting? To record, report and analysis human resource related figures through accounting system The result can be use for decision making purpose

Definitions : 

Definitions Definitions of Human resource accounting on the Web: Human Resource Accounting is a sophisticated way to measure the effectiveness of personnel management activities and the use of people in an organization.en.wikipedia.org/wiki/Human_resource_accounting A specialized HR audit that continually attempts to quantify the value of organizational human resources.www.crfonline.org/orc/glossary/h.html Accounting for the human resources of an enterprise (subject to adjustments) in the final statement of accounts.www.business-standard.com/india/news/key-accounting-definitions/287880/

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HRA is an approach to value the amount spent on human assets from recruitment to present position. - By Stephen explains

HRA is one of the latest concept adopted by Indian companies in recent times. The concept of human resource accounting can be basically examined from two dimensions: : 

HRA is one of the latest concept adopted by Indian companies in recent times. The concept of human resource accounting can be basically examined from two dimensions: 1.The investment in human resource. 2.The value of human resource.

1.The investment in human resource. : 

1.The investment in human resource. The expenditure incurred for creating, increasing & updating the human resource quality is known as investment in human resource .such investment yields fruitful result like higher productivity & higher income to the organisation.

Investment pattern : 

Investment pattern The human resource investment usually consists of the following items:- 1)      Expenditure on advertisement for recruitment 2)      Cost of selection 3)      Training cost 4)      On the job training cost 5)      Subsistence allowance 6)      Contribution to provident Fund 7)      Educational tour expenses 8)      Medical expenses 9)      Ex-gratia payments 10) Employee’s Welfare Fund All these items influence directly or indirectly the human resources and the productivity of the organization.

2.The value of human resource : 

2.The value of human resource The yield that the investment in human resource generates will be considered as the basis of human resource value.

What is the value of human? : 

11 What is the value of human? Human is priceless.

OBJECTIVES : 

OBJECTIVES 1.Helpful in making management decision. HRA furnishes cost value information for making mgt decision about recruitment, allocation & development of human resoures. 2.Helps to mgt to monitor efficiency. HRA helps mgt to monitor & assess efficiency of human resource more effectively.

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3.HRA provides determination of assets control. HRA provides determination is : Conservation Appreciation of Assets control. 4.Effective management of human resources HRA helps in effective & efficient management of human resources.

5.Greater accountability for human resources : 

5.Greater accountability for human resources HRA makes any organization greater accountable towards human resources. As mgt & owners start considering their human resource as valuable assets for the org rather then considering liabilities for them.

6.Better human resource planing : 

6.Better human resource planing HRA is helpful in better planning of human resources. Various models developed for accounting of human resources also help in planning of human resources.HRA also helps mgt in exercising better control.

IMPORTANCE OF HRA : 

IMPORTANCE OF HRA 1.Human resource are as important as physical resources for a business. A change in the investment in human resource will affect the earning capacity as well as the growth of the business. 2.acquiring,training & placing human resource for productive use involves a costs & it is necessary to capitalise such costs.

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3. Expansion in physical resources (building, machinery) it necessarily leads to increase in the investment of HR. Therefore information in forms of human resource accounting is essential. 4.HRA may be helpful in identifying causes for high labour turnover low return on investment & under utilisation of potential capacity of an enterprise.

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5.HRA promotes better mgt employee relationship by making realistic assessment of the contribution of employee & workers in the organisation. 6.The shareholders & creditors can take decision to make long term investment confidently on the basis of additional information in the form of HRA.

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6.It helps in decision making in he following matters Employment , locating and utilization of human. Transfers, promotions, training and retrenchment of human resources

Need for hra : 

Need for hra HR Accounting is very much needed to provide effective & efficient management within the organization.1.* If there is any change in the structure of manpower, it is HRA which provides information on it to the management. 2* It gives a platform to the management by providing factors for better decision-making for future investment.3* The return on Investment on human capital is best evaluated through HRA. 4* HRA communicates to the organization & public about the worth of human resources & also its proper allocation within the organization.5* HR helps the management in developing principles by classifying the financial consequences of the various practices.

LIMITATIONS : 

LIMITATIONS Although human resource accounting is quite useful to the mgt & others but it is objected by many on the following grounds. Ownership rights cannot be exercised on human being. Therefore, it is wrong to consider them assets like other physical assets. Tax law do not recognise the human resource as assets.

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5.Human resource are qualitative in nature. So many abstract factors are considered in the valuation of human resources. Thus human resources can not be precisely measures in monetary terms. 6.labour union may demand higher wages on the basis of HRA data.

Hra in india : 

Hra in india Though Human Resources Accounting was introduced way back in the 1980s, it started gaining popularity in India after it was adopted and popularized by NLC.  Even though the situation prevails, yet, a growing trend towards the measurement and reporting of human resources particularly in public sector is noticeable during the past few years.  BHEL, Cement Corporation of India, ONGC, Engineers India Ltd., National Thermal Corporation, Minerals and Metals Trading Corporation, Madras Refineries, Oil India Ltd., Associated Cement Companies, SPIC, Metallurgical and Engineering consultants India Limited, Cochin Refineries Ltd. Etc. are some of the organizations, which have started disclosing some valuable information regarding human resources in their financial statements. It is needless to mention here that, the importance of human resources in business organization as productive resources was by and large ignored by the accountants until two decades ago.

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THANK YOU Submitted By Ranjeet Kaur