tailieunhanh - An analysis of application of key financial ratios for human resources valuation in organizations

This paper tries to suggest a comprehensive, easy to use and relatively limitation free valuation ratio model termed Intellectual Capital Value (ICV), which is modification of existing ratio based models available. | An analysis of application of key financial ratios for human resources valuation in organizations International Journal of Management IJM Volume 10 Issue 4 July-August 2019 pp. 24 35 Article ID IJM_10_04_004 Available online at http ijm JType IJM amp VType 10 amp IType 4 Journal Impact Factor 2019 Calculated by GISI ISSN Print 0976-6502 and ISSN Online 0976-6510 IAEME Publication AN ANALYSIS OF APPLICATION OF KEY FINANCIAL RATIOS FOR HUMAN RESOURCES VALUATION IN ORGANIZATIONS Dr. Govind Patra Professor in Finance Lovely Professional University Jalandhar Punjab India ABSTRACT Knowledge workers are now most crucial resources for modern business organizations which keep all other assets men money machine and materials operative. However with growing emergence of knowledge economy the traditional valuation methods has been put into question due to the non-inclusion of Human capital as a major part of firm s total value in balance sheet. The value of Human Resources in an organization should be measured for sustainable growth of the organization since it plays the role of motivational tool efficiency measure yardstick and cost clarification. Human Resource Accounting HRA measures and reports the value of employees in B S which helps management take strategic decisions related to human resources in order to enhance efficiency and productivity. Unlike other category of assets valuation of Human Assets seems to be complex. One shortcoming is availability of good valuation model since all the models developed till now suffer from limitations in one form or other. This paper tries to suggest a comprehensive easy to use and relatively limitation free valuation ratio model termed Intellectual Capital Value ICV which is modification of existing ratio based models available. For this all the financial ratios useful for human resources valuation are analyzed first and then the new model termed Intellectual Capital Valuation ICV .