This paper investigates the complementary relationship between human resource accounting (HRA) and human resource information systems (HRIS) as components of strategic human resource management. Using a qualitative descriptive research design with a sample of 17 HR professionals, the study employs a structured self-administered questionnaire and thematic analysis to examine how HRA and HRIS interact. Findings reveal two key themes: HRIS tools and applications support HRA activities by providing the necessary platform for measuring human capital costs, while HRA ensures that HRIS generates complete and accurate organizational information by incorporating financial and non-financial accounting data. The study addresses a significant gap in the literature regarding the inter-relationship between these two concepts and offers practical insights for better integrating HRA into HRIS tools and applications.
The paper demonstrates effective use of thematic analysis in qualitative research: the researcher collects open-ended questionnaire data, identifies recurring patterns, and organizes findings into named themes (e.g., "HRIS supports HRA" and "HRA facilitates generation of complete HR information"). Each theme is supported by participant frequency data, blending qualitative depth with basic quantitative reporting — a technique that strengthens credibility in descriptive studies.
The paper follows a conventional IMRaD-adjacent structure: an Introduction establishing context and objectives, a Literature Review covering HRA, HRIS, and their relationship separately, a Methodology section detailing design, sampling, and analysis, a Results section presenting demographic profiles and emergent themes, a Discussion that connects findings to existing literature, and a combined Conclusion and Future Research section acknowledging limitations. This logical progression from concept definition through empirical findings to practical implications is well-suited to a graduate-level research paper.
Human resource management (HRM) refers to the tasks and activities that maximize employee performance within an organization. Over the past few years, HRM has become increasingly dynamic as organizational leaders constantly seek to improve quality, productivity, and effectiveness. New models for promoting the value and effectiveness of HRM have been developed and adopted across organizations. The evolution of HRM is fueled by rapid technological advancements and increased globalization (Aljamaan, 2017). Human Resource Information Systems (HRIS) represent one such model that has emerged in HRM. HRM also entails the management of accounting information, which is used extensively in organizational strategic decision-making.
Rapid technological advancements have contributed to the emergence of new models and approaches to human resource management. Human resource professionals are increasingly seeking measures to enhance the effectiveness of their processes and activities. These efforts have contributed to the development of new models including Human Resource Accounting (HRA) and Human Resource Information Systems (HRIS). The development of these models has been influenced by organizational leaders' growing awareness of the kinds of technology that can enhance organizational effectiveness. HRA and HRIS have become critical components of modern HRM initiatives, as both play a vital role in strategic decision-making processes.
HRIS is a term used to refer to integrated systems that collect, store, and analyze information about an organization's human resources (Gupta, 2013). The concept of HRIS was first introduced over five decades ago and has evolved well beyond its initial purpose of converting paper records into computerized databases. Contemporary HRIS tools enable HR professionals to carry out a variety of daily activities. Through these tools, organizations implement sophisticated computerized systems to ensure their records remain accurate and current. HRIS tools are considered critical in today's HRM as they enhance efficiency in HR decision-making.
According to Al-Hattami and Kabra, human resource accounting is one of the sub-systems within the accounting information system used in HRM (Al-Hattami & Kabra, 2018). Human resource accounting provides both financial and non-financial information regarding human resources. It achieves this by gathering data about an organization's human resources from a variety of sources and examining that data according to established accounting rules. The results of this process are then provided to all interested parties in order to promote the realization of desired goals and objectives. Therefore, HRA plays a critical role in understanding the accounting dimension of strategies and activities adopted in HRM.
While HRIS and human resource accounting have both become critical components of HRM, there is limited research on the link between these two concepts. There is also an erroneous assumption that human resource accounting primarily focuses on financial information alone, which negates the important role non-financial information plays in HRA processes and systems. This limited understanding has contributed to a lack of appreciation for the role accounting information plays in human resource information systems and human resource management more broadly.
The purpose of this study is to explore the complementary link between human resource accounting and human resource information systems. The study seeks to demonstrate how these two concepts are inter-related and how they jointly support HRM processes. This study is important to the field of HRM as it provides insights on the relationship between financial and non-financial information in HR practices. By exploring the relationship between HRA and HRIS, the study demonstrates how both types of information are critical in HRM and should be incorporated in a complementary manner. The study also addresses the existing gap in the literature regarding this complementary link, and highlights the need for HR professionals to design accounting information systems as an integrated part of HRIS tools for better decision-making.
This study seeks to achieve the following objectives:
1. To provide insights regarding human resource information systems.
2. To provide insights regarding human resource accounting.
3. To analyze the comparative relationship between human resource accounting and human resource information systems.
4. To clarify the significance of financial and accounting information in human resource information systems.
Human resource accounting and human resource information systems have been the subject of numerous studies in the HR field in recent years. Studies have been carried out on these concepts because of the evolving and dynamic nature of HR practices driven by rapid technological advancements. Existing literature has examined these concepts from various perspectives to help enhance HR practices and processes.
Existing literature demonstrates that there is no universal definition of human resource accounting, as numerous definitions exist (Mahmoodi, Babaei & Mohamade, 2013). HRA is defined as the process of identifying and measuring human resource information and providing that information to relevant stakeholders (Islam, Kamruzzaman & Redwanuzzaman, 2013). This definition suggests that HRA is a tool that can be used to report an organization's assets in both management accounting and financial accounting. HRA is also defined as the process of gathering, measuring, and providing information regarding human resources to promote effective organizational management (Mahmoodi, Babaei & Mohamade, 2013).
HRA entails accounting for human capital as part of an organization's assets. When HRA is employed in this way, the process generates numerical data regarding the value and cost of human resources as organizational assets (Al-Hattami & Kabra, 2018). As a result, organizational management adopts a human resource perspective in decisions involving people.
HRA entails accounting for expenditures associated with human resources as assets rather than through conventional accounting methods (Bullen & Eyler, 2010). Traditional accounting differs from HRA in that the former treats human-resource-related expenses as expenditures that reduce profit. Since HRA entails a different approach to accounting for human resource costs, it plays a critical role in enhancing both HRM and financial accounting and reporting. It provides a mechanism through which human resources are given emphasis and importance within today's accounting and HRM framework (Rao, 2014). Biswas contends that HRA plays a critical role in HRM because it provides information that management can use to evaluate decisions with regard to human resources (Biswas, 2013). By providing such information, HRA gives investors the opportunity to accurately assess and understand the full picture of the organization.
HRIS is defined as a systematic procedure for gathering, storing, retrieving, maintaining, and validating data regarding an organization's human resources (Gupta, 2013). HRIS tools have become common in modern HRM practices because they provide a means for ensuring the smooth running of an organization's internal operations. HRIS provides a framework for organizations to achieve incremental gains in efficiency and response time for traditionally complex and labor-intensive HR work. Over the past few decades, HRIS has been viewed as a function of information systems, which have become increasingly important for organizations (Buzkan, 2016). Organizations are increasingly implementing HRIS tools because of the recognized role information systems play in enhancing operations and competitive advantage across all areas, including human resources. Therefore, HRIS is essentially an intersection between information technology and human resources through a human resource software solution (Gupta, 2013). HRIS comprises computer applications, databases, and hardware and software essential for the collection, storage, maintenance, manipulation, and delivery of human resource information and functions (Al-Shawabkeh, 2015).
According to Johnson, Lukaszewski, and Stone, information systems have traditionally had a major impact on the functioning and overall effectiveness of organizations (Johnson, Lukaszewski & Stone, 2016). This impact has in turn facilitated the adoption of information systems into human resource practices through the development of HRIS. HRIS is viewed as electronic human resource management, used to support core functions, decisions, and processes (Johnson & Gueutal, 2011). Qadir and Agrawal (2017) attribute the emergence of HRIS to the re-engineering of conventional HR processes and applications through information technology. This journey has involved transforming HRM from the conventional attendance sheet to the balance sheet in order to achieve strategic human resource management. As technology is increasingly adopted in HRM practices, many HR functions have been re-engineered to result in the establishment of HRIS. Additionally, this transformation has changed the role of human resource professionals and their jobs. HRIS has become critical in today's HRM practices because of the role of HR professionals as strategic partners with top management (Beadles II, Lowery & Johns, 2005).
HRIS has become an important management information system that improves an organization's human resource administration functions (Nagendra & Deshpande, 2014). This significance is attributable to HRIS's role in automating most HR planning functions (Weeks, 2013). Some of the HR planning functions automated by HRIS include identification of potential employees, maintaining complete employee records, and developing programs for employee talent development. As an important management information system, HRIS helps coordinate and control major functions relating to human resources (Bal, Bozkurt & Ertermsir, 2012).
Qadir and Agrawal suggest that the relationship between HRA and HRIS is evident in the development of HRIS tools (Johnson & Gueutal, 2011). The development of HRIS following the adoption of technology in human resources has involved transforming traditional HR functions and practices, including changing the role of HR from conventional attendance management to balance-sheet reporting. This shift has provided an opportunity for accounting in human resources to be integrated into HRIS. However, there is minimal integration of HRA into today's HRIS, as the two concepts are not widely considered inter-related. This poor integration is attributable to the challenges many organizations face in executing HRA (Cherian & Farouq, 2018). While HRA is viewed as a critical tool for measuring performance, challenges in its execution have contributed to poor integration into HRIS applications (Bhosale, 2015).
Marler and Boudreau contend that there is limited evidence on the link between HRA and HRIS (Marler & Boudreau, 2017). HRA is viewed as an important component of modern HRM practices because of the evolving role of HR professionals and their jobs (Kariyawasam, 2016). The adoption of technology into HR practices has provided a framework for the development of HRA tools, which are increasingly used. Existing literature provides evidence of the role HRA plays in improving the efficiency of HR practices and enhancing organizational performance through a different approach to accounting for human resource costs. However, there remains limited evidence in academic research on the precise relationship between human resource accounting and human resource information systems.
The identification of a suitable research methodology is an important step in enhancing the reliability and credibility of a study's findings. Qualitative, quantitative, and mixed-methods research are the three methodologies appropriate for different studies based on various factors. One key factor is the nature of the issue under investigation. Qualitative approaches are suitable for studies that are exploratory, descriptive, and explanatory, whereas quantitative approaches are suitable for studies involving cause-and-effect relationships or hypothesis testing (Creswell, 2014). Given the exploratory nature of the present study, a qualitative research design was employed.
This study employed a qualitative descriptive research design, an approach that focuses on identifying the nature of specific issues or events under study (Lambert & Lambert, 2012). Qualitative descriptive studies involve naturalistic data through which researchers attempt to describe phenomena, objects, or particular situations. In essence, descriptive studies focus on providing an accurate description of a research issue or problem. This design is well suited to the present study, as the researcher seeks to explore how human resource accounting complements human resource information systems and to address the gap in existing literature. Through this approach, the researcher seeks to describe the phenomenon rather than impose personal judgments or interpretations.
To collect data on the relationship between HRA and HRIS, 20 human resource leaders and professionals working in different organizations were invited to participate. These participants were identified from the researcher's professional networks of human resource practitioners. Sample size calculations were carried out using an F test for repeated measures to determine whether the sample size was reasonable. The calculations targeted 80% power and an alpha error of 5%, regarded as the most suitable level for calculating the probability of a Type I error (Das, Mitra & Mandal, 2016). The sample power was .96 with an alpha error of .05, indicating that the research met the minimum recommendation for a powerful sample. Since the sample power was 96% and the alpha error 5%, the sample size is considered reasonable for this research.
The study sample was identified using convenience sampling, a technique in which a study sample is identified from members who are conveniently available to the researcher (Etikan, Musa & Alkassim, 2015). Participants were selected based on their geographical proximity, availability, and accessibility. The researcher ensured that all participants were HR professionals and leaders with relevant knowledge of the study variables. Data was collected using a structured self-administered questionnaire incorporating open-ended questions divided into two categories: demographic information and questions regarding the study variables.
Demographic data in the questionnaire included age, gender, education, and work experience. Data relating to the study variables addressed human resource accounting, human resource information systems, and the relationship between HRA and HRIS. The questionnaire was distributed among 20 HR leaders and professionals from various organizations. Prior to distribution, the purpose of the study and the questions were explained to participants. A total of 17 questionnaires were completed and returned within the one-month data collection period.
For data analysis, the researcher utilized thematic analysis, a qualitative data analysis technique that involves examining data for emerging themes and patterns used to answer the research questions. This technique is used to identify, analyze, organize, describe, and report themes and patterns within a dataset (Nowell et al., 2017).
Ethical issues in this study included privacy and confidentiality of participant data and the appropriate use of data. The researcher addressed these considerations by ensuring voluntary participation and limiting the use of participant data strictly to the research purpose. In addition, study participants were not required to provide any personal identification information.
The present study examines the complementary relationship between human resource accounting and human resource information systems. The results confirm the significant relationship between these two components and their mutually positive influence on each other. As demonstrated in the study, HRIS supports HRA activities by providing the necessary tools and applications for measuring human capital. On the other hand, HRA facilitates the generation of accurate information regarding an organization's human resources by ensuring HRIS incorporates accounting information. This suggests that HRIS and HRA should go hand in hand, as they complement each other in strategic human resource management. Insights obtained from the study findings can be used to promote better integration of HRA into HRIS tools and applications.
While this research provides significant insights regarding the complementary relationship between HRA and HRIS, it has several limitations. First, a small sample size was utilized, which may limit the generalizability of findings. Second, the researcher recruited participants only from his professional network, and did not consider other HR professionals who could have provided additional perspectives. The study was also conducted within a one-month period due to time and financial constraints. Therefore, larger-scale studies on this issue should be carried out to promote better integration of findings into HR practices and solutions. Future studies should also examine how to better integrate HRA into HRIS tools and applications.
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