Human Resources Accounting and Disclosure in Financial Statement: Literature Review

Abstract

The value of human assets has impact in all critical business decisions and how it is used directly affects the ability of the organizational assets to realize their value. This paper reviews the theory and research in human resources accounting, evolution of human resources accounting the meaning and considered different methods of human resources accounting. The paper also seeks to discuss the recording and disclosure in financial statement, objectives of human resources accounting and the need of human resources accounting in the organizations. The study also reveals obstacle against human resources accounting and condition that must be present before adopting to human resources accounting in the organization. It was recommended among other things that instead of holding unto imperfect convention, accounting is expected to change to meet the perfections introduced by the new ideas – human resource accounting and valuation because most businesses, management decisions are not based on conventional accounting rules or published statutory reports, but on tailor made management accounting information systems. It is here that the accounting for human resources must begin.

Keywords: Human Resources Disclosure and Financial Statement