Financial reporting on human resources in the bank sector : a dissertation of limited scope

Abstract

The problem of not currently reporting on human resources in the financial statements of business concerns was defined in chapter 1. This was followed by a discussion which centered around the importance and motivation of researching the problem. The framework and methodology to do the research were set out systematically and explained. Chapter 2 dealt with the theoretical context of human resources accounting. Concepts such as human resources accounting, financial reporting and accounting theory were discussed. Human resources accounting as a source of information and the role it plays in decision making were briefly discussed. In the last part of the chapter a theoretical framework of human resources accounting with specific reference to the traditional approach of accounting and the modem approach of accounting was researched. In chapter 3 the objectives and need for human resources accounting were discussed. The current status compared to the historical development and historical status was investigated to determine any new developments and progress on human resources accounting. The arguments for and against human resource accounting were also explained.

Chapter 4 showed that all the banks report on human resources in their financial statements. The importance of human resources to the banks is evident in the themes of human resources on which the banks have reported. These annual reports also proved that there is as yet no specific accounting principles to which businesses have to adhere to concerning this accounting subject. The extent and location of human resource disclosures also differed, due to the fact that there is no specific guideline on disclosing human resources in financial statements. In chapter 5 the conclusion and recommendations re the reporting on human resource accounting were given. The conclusion was reached that in order to develop as a science and enhance its status, accountancy must be encouraged to adopt the modem approach of human resources accounting. Arising from the above conclusion it is recommended that an exposure draft (ED) on human resources accounting be developed. This ED can be utilized to organise reporting on human resources in financial statements.