The Impact of Human Resource Cost on the Profitability of Firms: Empirical Evidence of Selected Listed Companies on Ghana Stock Exchange

Author(s)

Vincent Nana Yaw Osei-Owusu , LI Kaodui ,

Download Full PDF Pages: 188-197 | Views: 533 | Downloads: 154 | DOI: 10.5281/zenodo.4990817

Volume 9 - October 2020 (10)

Abstract

the study’s objective was to assess the impact of human resource cost thus staff cost on profitability of firms. The scope of the study was listed companies on Ghana Stock Exchange and it selected 42 listed companies as its sample for a period five years from 2014 to 2018. The study employed non-probability sampling technique thus convenient sampling to select the companies used due to availability of data. As the study used exploratory method, it used panel data methodologies to arrive at its conclusion. These methodologies used are unit root, cointegration test, correlation matrix, censored tobit regression method and robust least square regression method. In summary, the study found out that human resource cost thus staff cost negatively relate to profitability of companies in Ghana statistically. As the argument as to whether human resources of organizations should be considered as assets in order to value their productivity rather than being part of organizations expenditures which one way or the other affects their profitability

Keywords

Human resource cost, Profitability, Ghana Stock Exchange, Censored tobit regression, Robust least square

References

                    i.            American Accounting Association (1973). Report of the committee on accounting for human resources. The Accounting Review, 48(3), 6-11.

      ii.            American Accounting Association (1974). Statement of basic accounting theory. The Accounting Review Supplement, 40(9), 85-93.

    iii.            Barney, J.B. (1991). Firm resources and sustained competitive advantage. Journal of Management, 3(17), 99-120.

     iv.            Bayes, Paul Eugene. (1984): An Empirical Investigation of the Effects of Human Resource Accounting Information on Decision-Making: Results of Mail Survey, Thesis, University of Kentucky, U.S.A.

       v.            Bassey, B.E & Tapang, A.T (2012). Expensed human resources cost and its influence on corporate productivity: A study of selected companies in Nigeria. Global Journal of Management and Business Research, 12(5), 3-8.

     vi.            Becker, G. S. (1964). Human capital. New York: McGraw Hill.

   vii.            Enofe, A.O., Mgbame, C. Sunday O.S., & Ovie, O. (2013). Human resources accounting disclosures in Nigeria quoted firms. Research Journal of Finance and Accounting, 4(13), 7-12

 viii.            Frederickson, N. (1986). Toward a broader conception of human intelligence. American Psychology, 41(3), 445-452.

     ix.            Gebauer, N. (2003). Information systems on human capital in service sector organizations. Germany: New Library World.

       x.            Gul, Ferdinand A. (1984), “An Empirical Study of the Usefulness of Human Resources Turnover Cost in Australian Accounting Firm”, Accounting, Organization and Society, Vol. 9, pp. 233-239.

     xi.            Harward, M. & Upto, K. (1961). Introduction to Business Finance. NewYork:Mc Graw Hill.

   xii.            Katz, D. & Kahn, R. L. (1978). The social psychology of organizations. New York: Wiley.

 xiii.            Kirfi, M. M & Adbullahi, A. (2012). Human capital accounting: Assessing possibilities for domestication of practice in Nigeria. Research Journal of Finance and Accounting, 3(10), 57-63.

 xiv.            Malik, R.K. (1993), “Human Resource Accounting and Decision-Making”, Anmol Publishers, New Delhi.

   xv.            Newman, B. H. (1999), Accounting recognition of human capital assets. New York: Pace University Press.

 xvi.            Obara, L. C. (2013). Conventional human asset accounting treatment and corporate profitability evaluation. European Journal of Accounting Auditing and Finance Research,1 (3), 66-82,

xvii.            Porter, M. E. (1985). Competitive advantage: Creating and sustaining superior performance. New York: Free Press.

xviii.            Sackmann, S.A., Flamholtz, E. & Bullen, M.L., (1989). Human resource accounting: a state-of-the-art review. Journal of Accounting Literature, 8(3), 235-264.

 xix.            Schuler, R. S. & Macmillan, I. C. (1984). Gaining competitive advantage through human resource management practices, Human Resource Management, 23 (3), 241-256.

   xx.            Sen, D.K., Jain, S.C., Jat, S.L and Saha, R.K. (2008), “Human Resource Accounting Information: It‟s Impact on Internal Decision-Making”, The Journal of Accounting and Finance, Vol. XXII, No. 1, Oct-March, pp. 23-56.

 xxi.            Syed, A.M (2009). Human resource accounting disclosure of Bangladeshi companies and its association with corporate characteristics. BRAC University Journal. (1)1, 35-43.

xxii.            Tomassini, Lawrence A. (1977), “Assessing the Impact of Human Resource Accounting: An Experimental Study of Managerial Decision Preferences”, The Accounting Review, Vol. 52, No. 4, October, pp. 904-914.

Cite this Article: