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COST OF HUMAN RESOURCE

ACQUISITITION TRAINING & WELFARE OTHER COST


COST DEVELOPMENT COST
COST
Recruitment Cost Formal Training Medical Safety
Cost Expenses Expenditure

Selection Cost On The Job Canteen Ex-gratia


Training Cost Expenses

Placement Cost Special Training Specific & Multi-trade


General Incentives
Expenses
Campus Interview Development Other Welfare Rewarding
Cost Programs Expenses Suggestions
OBJECTIVES OF HRA

 To furnish cost value information for making


proper & effective management decision.
 Effectively use HR.
 An analysis of human assets.
 Facilitates valuation of HR, recording the
valuation in the books of accounts and disclose
the information.
 Helps the organization in decision making.
LIMITATIONS OF HRA
 No specific procedures.
 Period of existence of HR is uncertain.
 Fear that it may dehumanize or manipulate
employees.
 The form and manner in which it needs to be
included in the financial statements is unknown.
Cont…
 Human beings cannot be owned, retained
and utilized like physical assets.
 Fear of opposition from Trade Unions.
 How to amortize HR?
 Tax Laws
 No universally accepted method
HRA represents a new way of thinking
strategically.