The United States Central Intelligence Agency has come under scrutiny by taxpayers in recent years for excessive spending under a 'Black Budget:,' secret money used to fund operations at home and abroad. This secret stash of cash is allowed for national security reasons due to passage of the 1949 CIA Act and a subsequent Supreme Court Ruling in 1974 . Critics of the CIA's Black Budget argue that it weakens financial accountability and masks the true size of the organization. They could have a point.

What does the CIA's Black Budget have to do with your company's human resources function? More than meets eye.

HR is the corporate king of Black Budgeting. While the Senior Vice President of HR may do an annual budget and see the monthly cost reports, he or she probably doesn't have visibility into half of the true HR costs for the organization. The unfortunate reality is that many HR executives don't know the real costs shareholders are paying to support an HR function. Actual HR costs can be double the official HR budget. These hidden costs, which can amount to $50 - $100 million in a large company, are often hidden from view by the clouds of corporate budgeting, cross-charging and back-door processing.


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