Human Asset Accounting and Its Impact on the Performance and Financial Position of Firms: A Study of Selected Companies
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Human beings are the most critical assets in organizations as established in the available literatures. They drive other resources in the organization to achieve organizational goals. Currently, this most important asset is not being accounted for or disclosed in organizations’ statement of financial position like other physical assets and intangible assets. Hence, this study investigated the likely effect of human asset inclusion in the financial reports of firms in Nigeria. The specific objectives of the study were to study the nature and characteristics of human resource investment/expenditure in quoted Nigerian companies, to determine the relevance of human asset accounting model in relation to the quality of financial reporting of quoted companies in Nigeria, to investigate the relationship between Human Asset Accounting and Corporate performance (Profitability), and to investigate the relationship between Human Asset Accounting measurement and corporate financial position. The study adopted the survey research design. The instrument of data collection was questionnaire designed on a four step Likert Scale. The hypotheses were tested using simple regression model. The result of the analyses confirmed that there is a significant relationship between Human Asset Accounting and Corporate Profitability and there is positive significant relationship between Human Asset Accounting measurement and corporate financial position. It concluded that capitalizing human assets would positively impact on performance and financial position of organizations and recommended its disclosure as intangible asset in the balance sheet.
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