• Ramya Jain Assistant Professor, Department of Commerce, Ramanujan College, Delhi University


Human Resource, Accounting, Valuation, Human Asset, Earnings


Human Resource Accounting is the process of assigning, budgeting, and reporting the cost of human resources incurred in an organization. Conventionally, according to general accounting principles, only monetary and physical assets are accounted in the books of account and there has been a failure to value human resources of an organization. However there is a change in this concept, now any expense on human resources should be treated as a capital expenditure because such expenses yield benefits for a long time period and should be shown as an asset in the Balance Sheet. The paper aims to review the literature available on human resource accounting. The paper tries to evaluate the historical background that led to the emergence of the concept of HRA. It investigates the various models both monetary and non-monetary that have been developed for the valuation of human resources.


I. Brummet, R.L., Flamholtz, E.G. and Pyle, W.C. (1968). Human Resource Measurement -- A Challenge for Accountants. The Accounting Review, Vol. 43, No. 2 (Apr., 1968), 217-224.

II. Chakraborty, S. K. (1976). Human Asset Accounting: The Indian Context in Topics in Accounting and Finance. Oxford University Press.

III. Flamholtz, E.G. (1999). Human Resource Accounting: Advances, Concepts, Methods and Applications, Boston, MA: Kluwer Academic Publishers.

IV. Flamholtz, E. G. and Likert, E. (1973). Human Resource Accounting: Measuring positional replacement costs. Human Resource Management 12(Spring), 8-16.

V. Flamholtz, E. G. (1971). A Model for Human Resource Valuation: A Stochastic Process with Services Rewards. Accounting Review, 46(2), 253-267.

VI. Hekimian, J. S. and Jones, C. H. (1967). Put People on Your Balance Sheet. Harvard Business Review, January-February 45, 105-113.

VII. Hermanson, R. H. (1964). Accounting for Human Assets. Occasional Paper No. 14, Graduate School of Business Administration, Michigan State University, 1-69.

VIII. Jaggi, B. and Lau, H.S. (1974). Toward a Model for Human Resource Valuation. The Accounting Review, Vol. 49, No. 2 (Apr., 1974), 321-329.

IX. Lev, B. and Schwartz, A. (1971). On the use of the Economic Concept of Human Capital in Financial Statements. Accounting Review, 46(1), 103-112.

X. Likert, R. and Bowers, D.G. (1968). Organizational Theory and Human Resource Accounting. American Psychologist.

XI. Morse, W.J. (1973). A Note on the Relationship between Human Assets and Human Capital. The Accounting Review, Vol. 48, No. 3 (Jul., 1973), 589-593.

XII. Mir, Dr. A. A. and Singh, M. (2011). Human Resource Accounting (HRA) – A conceptual framework and International Developments. International Journal of Research in Computer Application and Management, VOL. 1, ISSUE 4 (JUNE), 108-114.

XIII. Ogan, P. (1976). A Human Resource Value Model for Professional Service Organizations. The Accounting Review, Vol. 51, No. 2 (Apr., 1976), 306-320.

XIV. Pyle, W. C. (1970). Human Resource Accounting. Financial Analysts Journal, September-October, 1970, 69-78.

XV. Rao, Dr. A.L. (2014). Human Resource Accounting: a frame work for better Financial Accounting and Reporting. IOSR Journal of Business and Management, Volume 16, Issue 4, 86-90.

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How to Cite

Ramya Jain. (2017). HUMAN RESOURCE ACCOUNTING METHODS: A LITERATURE REVIEW. International Education and Research Journal (IERJ), 3(6). Retrieved from