Michael McMaster <Michael@kbddean.demon.co.uk> responds to HR:
>"TJ" says, "... companies have not tried to put the value of their
> people on the balance sheet for depreciation purposes which, IMHO,
> proves that people cannot be viewed or even named resources."
>No. That just proves there isn't an accounting convention to handle the
>issue.
>
>Good thing too. While people may be considered a resource - accounting
>treatment or not - it does not follow that a "resource" needs to be
>depreciated. There are other (living) examples of resources that
>appreciate. (I'll leave it to the interested to discover some.)
As I recall the history of the evolution of HR, it replaced "Personnel"
which had become tainted as a bureaucratic paper-pushing function. HR
incorporated such additional functions as training at least from an
accountablility (complicity?) perspective at budget time as they were
charged with nurturing the human resource which was viewed as renewable
much like the natural resources of our forests.
We need to beware of accounting practices as being representative of
value. Inventory is considered an asset, yet "smart" companies can produce
the same revenues and more profits with less inventory. This reduces the
asset value of the company quickly while the profits follow more slowly.
(This represents a stock market play to a "smart" player.)
As another example, a retail store is valued by their inventory and the
value of the retail outlet itself. The rest of the value is lumped into
"goodwill" which accounts for the value of the staff, the customer
satifaction, the rate of repeat business and anything else that might be
ascribed to filling the gap between traditional accounting principles and
the reality of what the business is worth...Keith
--Keith Cowan <72212.51@CompuServe.COM>
Learning-org -- An Internet Dialog on Learning Organizations For info: <rkarash@karash.com> -or- <http://world.std.com/~lo/>