The discipline of management is, among other things, the skill of translating accounting information into behaviour. Where the knowledge and skills of employees are the principal asset of an organisation, current key performance indicators rarely provide appropriate or relevant information and indeed may be misleading to management. Since managing the knowledge and skills of employees is the current organisational challenge (Handy, 1996) it is time that serious consideration is given to the development of measures that meet this challenge.
This paper proposes a human resource accounting model that utilises the balanced scorecard concept and seeks to strengthen its innovation and learning perspective. The aim is to provide information that allows management to monitor the performance of its human resources and also enables others to assess managementís ability to nurture and to augment the talent and accumulated knowledge of their organisationís human resources. This model could be considered the beginning of Puxty's (1993) long road in search of a planning, control and performance measurement system that accounts for the human element of an organisation's intellectual assets.
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