Abstract
The conventional accounting practice has been faulted for failing to adequate and relevant information required for investment decision making because annual reports lack monetary information on human resources.
In order tofill the gaps created by this inadequacy and keep pace with economic reality, a number of organisations in both developing and developed such as India, Jordan, Sweden, , United States and Great Britain have voluntarily,
Embraced monetary Human Resource Accounting (HRA) practice,which involves monetary valuation of human resources however, companies in Nigeria are yet to key into this practice.
The study therefore, set out to model a valuation tool for HRApractice in Nigeria. The specific were to ascertain the extent of HRA practice in Nigeria;
Examine the differences in HRA practices between Nigeria and India,a countryknown for human resource valuation; and develop a reporting format for HRA practice in Nigeria.
Introduction
1.1 Background of Study
For any corporate entity to operate successfully, resources in the form of people, materials, machines and money are a necessity. These resources are broadly classified into two categories- the human resources and the physical resources.
People represent the workforce and are referred to as the human resources while „physical resources‟ is used to describe resources in the form of material, machines and money.
It is required that both financial and non-financial informationwith respect to corporate organisations be communicated to the relevant stakeholders via accounting which is the language of business.
Meyer (2007) describes accounting as a tool used for measuring the monetary value of any organisation that is based on tangible and intangible resources within the concept of generating and communicating the wealth of companies.
The function of Accounting as stated by Greuning (2011) is to “identify; measure and communicate economic information to permit informed judgement and decision by users of theinformation” (p. 8).
References
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