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Dr. Anil Mehta

a process of identifying and measuring data
about human resources and communication
this information to concerning parties
American Accounting Association
accounting for people as an organizational
resource. It involves measuring the cost
incurred by organizations to recruit, select
train and develop human assets. I t also
involves measuring the economic value of
people in the organization

Provide cost value information.
Effectively monitor the use of human
Find whether human assets are appreciating or
depreciating over a period of time
Assist in development of effective management

It is not easy to value human assists in an
HRA is full of measurement problems.
Employees and humans may not like the idea.
There is no empirical evidence to support the
idea that HRA is an effective tool to measure
the economic value of people in the

Approaches to HRA
Monitory measures
Historical cost method.
Replacement cost method.
Opportunity cost method.
Economic value method.
Asset multiplier method.
Discounted present value of future earning method.

Non monitory measures

Expected realizable value method.
Discounted net present value of future earnings.

Controlling cost of manpower

Management by objectives(MBO)
Ratio Analysis
Cost of Recruitment Recruitment Cycle
Time, Cost of Turnover, Cost of training
Personnel Productivity
Personnel Reports, Budgets and Audits