of recruitment and at the time of retirement. Out of these, a few employees may leave the organization before attaining the superannuation. This method is the only method of Human Resource Accounting that is based on sound accounting principles and policies. Limitations The valuation method is based on the false assumption that the dollar is stable. Since the assets cannot be sold there is no independent check of valuation. This method measures only the costs to the organization, but ignores completely any measure of the value of the employee to the organization. It is too tedious to gather the related information regarding human values. it may be possible that the employee is already fully trained and there is no need to incur any development, training, or recruitment costs. It will create difficulty for a company to find out CTC according to acquisition model. Does not account for software which can reduce the overall cost of human resources by having integrated software completing the tasks of staff. Replacement cost approach This approach measures the cost of replacing an employee. According to Likert (1985) replacement cost includes recruitment, selection, compensation, and training cost (including the income foregone during the training period). The data derived from this method could be useful in deciding whether to dismiss or replace the staff. Limitations Substitution of replacement cost method for historical cost method does little more than update the valuation, at the expense of importing considerably more subjectivity into the measure. This method may also lead to an upwardly biased estimate because an inefficient firm may incur a greater cost to replace an employee (Cascio 3–4). Present value of future earnings Lev and Schwartz (1971) proposed an economic valuation of employees based on the present value of future earnings, adjusted for the probability of employees’ death/separation/retirement. This method helps in determining what an employee's future contribution is worth today. Limitations The measure is an objective one because it uses widely based statistics such as census income return and mortality tables. The measure assigns more weight to averages than to the value of any specific group or individual (Cascio 4–5). Value to the organization Hekimian and Jones (1967) proposed that when an organization had several divisions seeking the same employee, the employee should be allocated to the highest bidder and the bid price incorporated into that division's investment base. For example, a value of a professional athlete's