Human Resource Accounting: The Missing Element in the Statement of Financial Position. Empirical Evidence from Ghana

The human resource is the most valuable asset of any business organization. This is because it utilizes other resources to create value for the organization yet it is not incorporated into the statement of financial position of the business. This paper examines what accounts for its exclusion and the way forward. A descriptive research design was deployed for the study. A purposive sampling method was used to select 140 members from the Institute of Chartered Accountants (Ghana) with a response rate of 82.1%.  It was revealed that the inclusion of the human resource in the Statement of Financial Statement cannot be achieved now until broader consultation and participation of key actors in the accounting field. The key challenges include initial and subsequent measurement problem; distortion of shareholders’ networth; there is no standard or law that supports its inclusion and lack of active market for human resource. Developing an appropriate and acceptable model for Human Resource Accounting is very difficult to achieve because of the variables to include in the model. The paper, however, recommends that the International Accounting Standard Board (IASB) should engage key actors and experts in the accounting field to debate on the pros and cons of human resource inclusion in the Statement of Financial Position. Keywords: Human Resource; Statement of Financial Position; Model; Standards; Value; Measurement; Assets

Effect of exchange rate on inflation in the inflation targeting framework: Is the threshold level relevant?

The continuous depreciation of the exchange rate in Ghana has raised concern about its effect on inflation and the economy at large. This paper examines the threshold effect of exchange rate pass-through (ERPT) on inflation using a monthly data from January 2002 to December 2018. The relevance of the exchange rate threshold in the Taylor rule has also been examined. Using the threshold autoregressive (TAR) method, the results of the ERPT model revealed that exchange rate depreciation beyond a monthly threshold of 0.70% has a significant positive pass-through effect on inflation, which gives credence to the relevance of threshold level. The results of the monetary policy rule model also showed that regardless of the threshold level of 0.51%, the exchange rate significantly influences the monetary policy rate positively. Therefore, paying proper attention to the exchange rate in the policy rule despite the threshold (0.51%) will prevent the exchange rate depreciation from exceeding the optimal level (0.70%) and hence no ERPT on inflation. Based on these findings, it is suggested that monetary regulators should view the exchange rate at any level essential to adjust the policy rate