Background: Prior to industrial revolution the status of labor was very low.

Human relationship between the employer and employee was characterized by slavery. But the perception about labor was visibly changing and labor was considered on psychological grounds in the backdrop of industrial revolution though any significant rectification in conceptual arena wasnt noticed until some welfare mechanism for the workforce was recognized and successfully implemented in different companies like Cadburys at Bourneville, Ford Motor Company in the late 19th century. Taylor in his theory on scientific management had given more emphasis on human relations for efficient operation of factories. In the middle of last century technological development, rise of competition, consumerism, social changes and political developments fundamentally changed the relationship between people and work. Labor was treated as a resource with emotional attribute unlike other resources in the enterprise and serving this human resource became a pre-condition for industrial effectiveness. A separate department was established for that purpose, policies regarding human resource were formulated and Human Resource Management emerged as a subject of study. After 2nd World War European multinationals like Shell and Philips developed new approaches to personnel development in line with civil service training and more sophisticated policies on HRM were developed. 20th century witnessed growth of Human resource management and development practices from different angle giving rise to a clear opposition of thought among academicians who professed two ideas on HR practices as soft or hard. A soft HR practices focused on leadership, cohesion and loyalty that play important roles in organizational success. Reporting on HR practices in annual reports was limited only to posting of employee related expenses in profit and loss account and disclosing information on some key executive as per section 217(2A) of Companies Act1956. No managerial decision could be made from such information. Thus a rigorous quantitative measurement of HR practices was felt necessary and for this reason the proponents of hard HR practices professed the idea of Human Resource Accounting(HRA) in 1960s. After the concept has been incepted in USA and Canada some organization, viz., Milwaukee Braves Inc(1963), R.G.Barry Corporation(1968), Touche Ross & Co., Montreal(1971), Texas Instrument(1971), Lester Witte & Co.(1975), U.S.Navy(1984) and Touche Ross & Co.(1988) have experimented on it and HRA began to spread its tentacles. Replacing historical cost principle of recording employee related expenditure, HRA advocated adoption of replacement cost method and present value method for valuing human assets. Replacement cost entails the estimation of present cost of replacing the existing personnel under existing organizational conditions. Present value technique discounts the estimated future net earnings of the company contributed by its personnel in present value terms with a proper discounting factor. As this method considers time value of money, it is mostly suggested by the academician and practiced by the companies. But different authors take different point of view in measuring future estimated earning and discount rate. This gives rise to number of models, three of which are worth mentioning viz., (a) Capitalization of salary method suggested by B.Lev & A.Schwartz, (b) Stochastic reward valuation model suggested by Flamholtz & James Lundy. (c) Jaggi & Laus model. The output generated from HRA system of different organization has been found useful to take variety of managerial decisions, eg. , recruitment planning, turnover analysis, capital budgeting etc. In the later part of the last century, both the title and traditional role of the personnel function was progressively superseded by the emergence In larger organizations sophisticated human resources departments are opened up for managing strategic human resource related problems. Despite these worldwide developments HR practices are still in a infancy stage in India. Researches and investigations are done on this issue since independence but a lot more thing is yet to be done. Though recording and reporting quantifiable HR information is not a natural practice for Indian companies, some of the organizations in public (eg. SAIL, BHEL, MMTC) private (eg. TATA Motors) sectors are practicing HRA and taking important steps in quantifying and interpreting HR policies in a scientific fashion.