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The human resource valuation system cannot be considered to be a complete system of accounting unless it is followed by an equally competent system of auditing. Application or use of human resource accounting, therefore, must also be followed by a separate HR audit to ascertain whether or not the performance of the managers has been true and fair in the overall interests of the organization they serve. The application and usefulness of human resource valuation depends on the future efforts and experiments to be made by practising managers, accountants and academicians. It also needs support from the professional bodies and government. In the absence of human resource valuation, the management may not realize the negative effects of certain programmes aimed at improving profits in the short run. Such programmes may result in decreased value of human assets due to a fall in productivity levels, high labour turnover and low morale. Audit of human resources could help in finding out the efficiency of every segment. Human resource audit could enable the appraisal of the performance of various managers. The basic function and management of human resources is also greatly facilitated. Hence human resource valuation and audit activity could be helpful in improving the efficiency of human resources in the changing business scenario.

Human resource accounting is concerned with the identification and measurement of data relating to the organisation's human resources and the communication of such relevant information to interested parties. Our objectives in this article are firstly to familiarise both financial and non‐financial managers with the techniques of accounting for human resources, and secondly to summarise the advantages and disadvantages of this additional financial reporting activity. The wide range of human resource valuations yielded by different accounting procedures is demonstrated in a research application of human resource valuation to the staff of Liverpool F.C. Ltd.

‘Human resource accounting’ (HRA) is a term of relatively recent origin: research on HRA only began during the 1960s. Initially, the objective was to improve corporate financial reporting by accounting for ‘human assets’ and, in turn, to increase the representational validity of income and asset numbers. A related purpose was to prevent prevailing accounting conventions from motivating suboptimal treatment of people — specifically, to reduce the likelihood that liquidation of human resources would not be revealed in financial reports because of the failure to account for investments in people as assets.

The application of human resource accounting requires the measurement of the firm's investment in recruitment, selection, training and development. Our objectives in this article are firstly to familiarise readers with the methods proposed in the literature by which this measurement may be achieved, and secondly, to consider the implications of this recent development in financial reporting for the personnel function. The significant effect on annual accounts is demonstrated in a research application of human resource valuation in the Football League.

The purpose of this paper is to propose an improved economic value model for human resource valuation. For this purpose, the probability of promoting people to a higher position and the satisfaction coefficient of employees and customers have been computed by competency and Kano models.

In order to calculate the probability of promoting people to a higher position, competency model and questionnaire have been used. The satisfaction coefficient of employees and customers has been calculated as a factor influencing the survival of an individual in the organization by using the Kano model. For this purpose, two questionnaires have been designed; one was completed by the employees and the other by the customers. The proposed model has been examined in a consulting company in Iran.

The human resource value of the company under study has been estimated over 29bn rials (Iranian currency). The obtained results indicate that the proposed approach as an integrative monetary and nonmonetary measure can remove the limitations of the economic value model.

The proposed model helps organizations in managing their human capitals more effectively.

In this study, the Kano and competency models have been integrated with one of the common models of human resource valuation, i.e. the economic value model. The proposed integrated model seems more effective compared to the basic model of economic value model. Application of the proposed model within the context of Iran for the first time would constitute as potential for contribution to the knowledge of human resource management in the developing countries.

A recent paper by Flamholtz and Wollman described the conceptualisation, development, and implementa‐tion of the stochastic rewards model for human resource valuation (SRVM) in a human capital intensive firm. An essential prerequisite before such models can actually be implemented in organisations (and used in personnel management in the ways described by Flamholtz and Wollman) is to assess the empirical validity of the numbers generated as measurements of human resource value. The purpose of the study reported in this paper, therefore, is to investigate the “convergent and discriminant validity” of the SRVM in the context of a human capital intensive firm. Our intent is to contribute to the development of human resource accounting by going beyond the theoretical justification of the previously proposed SRVM and present some empirical evidence on the validity of the numbers generated by the model.

This paper considers whether the prospective services provided by a football player on behalf of the club holding his registration can be recognised as an accounting asset. The first section of the paper considers the appropriateness of treating these prospective services as intangible assets within the terms of the UK Accounting Standards Board criteria for definition and recognition of assets. In the second section, four valuation methodologies are evaluated using case study data made available by a major Scottish club. Each of the methods evaluated is either currently used in accounting practice by some clubs, or is used in some form in the existing market place for players. The historical cost model involves capitalising players acquired by the club via the transfer market on the balance sheet at their cost of registration. The earnings multiplier model applies a multiplier to a player's earnings to produce a current valuation of that player. The third model involves capitalising players at directors' valuation, while the independent multiple player evaluation model involves obtaining valuations for players from various informed sources, knowledgeable on those particular players. The paper concludes that there are convincing arguments for the conceptualisation of the services provided by football players as accounting assets, and recommends an system of valuation in which players are valued at their realisable value by independent experts.

My objectives in this chapter are firstly to familiarise readers with the proposed methods by which human resources can be valued and secondly to summarise the benefits and objections to this concept of accounting. Finally, the significant effect of human resource accounting on annual accounts is demonstrated with regard to Liverpool Football Club.

Economic theory posits that production factors that are both difficult to imitate and capable of creating organizational efficiencies can generate economic rents and sustain long-term competitive advantage. Using survey data for 106 firms, we measure four dimensions of strategic human capital and find that the market values strategic human capital that has the capability to create efficiencies in the organization and is also difficult for competitors to imitate. We discuss implications for the reporting of human capital in intellectual capital reports and offer suggestions for future research.

There is growing recognition that the core economic resources of the current era are human and intellectual capital, rather than physical assets such as inventories, plant, and equipment. Given the increasing importance of human capital and intellectual property as determinants of economic success at both the macroeconomic and enterprise levels, it is clear that the nature of investments made by firms need to shift to reflect the new economic realities. Specifically, if human capital is a key determinant of organizational success, then investments in training and development of people also become critical. In turn, there is a need to develop concepts and tools for monitoring and evaluating management development programs in terms of their impact, results, and value or return on investment. The specific objective of this article is to draw upon the concepts and measurement approaches of the field that has come to be known as “human resource accounting” and show how they, specifically the stochastic rewards valuation model, can be used as tools for the measurement of the value of investments in training programs designed to increase the value of human capital.