Please Explain the concept of "Cost Based Approach" to Human Resource Accounting. (This is a branch of Accounting)

Concepts and definitions for many accounting and human resources, each was based on the aspect represented by the human resources in business organizations have emerged, it has Flamholtz definition "to represent the cost of selection and appointment of human origins, development and management, as well as to measure the economic value of individuals within the project." The Likert was launched in definition of accounting and human resources of his vision to the project as a human organization and its resources include the loyalty of employees, suppliers and customer groups. Others also launched in theirs definition for accounting and human resources of the various parties to look accounting data related to human resources, it has been the definition Brummet That "I consider the use of accounting and human resources indication of the various aspects of the human resources of knowledge, training, and recruitment and redundancy." The Alexander has focused on his own to link accounting and human resources in the core accounting and in particular the corresponding principle in accounting Matching any interview costs revenue definition have accounting and human resource definitions "as an extension of the accounting principles and that to meet the costs of income, and organize data to human resources to be connected to the specialists expressed monetary values. Finally, the American Accounting Association definition (AAA) human resource accounting as "a set of concepts, principles, methods and procedures that govern the process of identifying and then the data related to human resources to measure, with the intent to deliver after that to related parties."

Efficient Human Resources Department concentrates on competitive cost and expenditure for the organization and employees. It is not a part of Accounting rather part of Human Resource Management because it involves to use the optimum human resources for the organization to reach the organizational goals and objectives..

Human resource accounting on the basis of cost

This approach is based on personnel costs borne by the company,

And the costs of hiring and training and development costs and the costs of maintaining the

Human resources, and there are several methods to measure the costs of human resources such as costs

Historical and opportunity costs and replacement costs, where it can adopt any of the

These methods in the evaluation of human resources on the basis of cost.

 

The accounting treatment of human resources vary by primary objectives

The focus of the company to apply for accounting Moar human d and also depends on the size of the company

And the diversity of human resources in the company

  Three methods of accounting treatment of human resources:

1. The first style: The creation of six accounts

- A human assets account

- To calculate the costs of obtaining human resources (recruitment costs)

- C expense of human resource development costs

- Dr. account accumulated depletion of human resources

  - Its human capital account

G - Reserve Human Resources losses account

Since the costs of recruitment and development costs are taken into account assets

Human at the end of the period, and that the value of the depletion of human resources at the end of the period addressed in

Debtor to calculate the depletion of accumulated human resources side, and restrict the value of resource depletion

Human financial period within the operating expense of the period.

2. The second method: the construction of four accounts, are:

- A calculation of the costs of access to human resources

- To account for the costs of the development of human resources

- C account of human assets

- Dr. account for the depletion of accumulated human resources

And accounting treatments are similar to the first method

3. The second method: the creation of two accounts: the investment in human resources account,

And another account for the depletion of investments in human resources, as is the establishment level

Second of all accounts are taken to invest in human resources account, is

Accounts of the various costs of human resources, recruitment and costs as costs

Training, and the costs of maintaining the human resources.

The foundation of human resource accounting is to disclose the cost of human resources

Them in later periods in the balance sheet that can be used instead of what is happening it

The case in traditional accounting, as are disclosed all costs pertaining to resources

Human in the income statement as Aiardih costs.