Bookkeeping the human factor

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Bookkeeping the human factor

#1  Postby Steve » Apr 08, 2012 5:37 pm

Just floating a balloon...

It just occurred to me that business bookkeeping logs the humans involved in a business as "Expenses" such as wages, salaries, training costs, etc. When it records a piece of equipment it records it as an "Asset" that has a life. That seems odd to me.

Could people be booked as Assets whose value can change based on their "life" within the business. We will still have the expenses of maintaining them through paying them - a truck won't perform if you don't put gas in the tank. But unlike a truck people can last for decades, and unlike a truck their performance can get better - their value can increase.

At present a business does not pay for a new hire the same way it pays for a new truck. But it should - a good person requires a shitload of money to grow and develop. They require constant attention as babies, provided by parents who usually get some small financial recognition in reduced taxes, then educating which in my view is best paid by a government. The amount of investment is adjusted in large part by the motivations of the individual and if they cheat the system and engage the legal system as criminals they then incur costs to that asset value - they become a little less valuable to society, even a "liability".

Does it seem silly that people could be "valued" by society, so that they could be entered on the books and a business is then charged with maintaining and developing that "value" on behalf of society? If someone is unhappy should a business have a role in mitigating that unhappiness?

Just some random thoughts about how we treat "people" and "account" for them through their lives. Things are going to change in the very near future and it will either be bad or worse if we don't adjust our thinking. I am looking to find ways things could be "better".

I would love to see this comment by John Lennon make better business sense.

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Re: Bookkeeping the human factor

#2  Postby zoon » Apr 08, 2012 8:07 pm

Digging up what I remember of accounting here - if a business is sold as a going concern, then good employees and employee relationships can count in the "goodwill", or extra money paid for the continuing business above what the equipment, buildings and so on would be likely to fetch if the business ceased. So employees can be intangible assets, but not tangible assets like machinery or buildings. I suspect in the days of slavery, slaves would have counted as tangible assets because they could be sold. (This is financial accounting, which represents the business' worth to the outside world, and has strict rules, including what counts as an asset. People who aren't slaves can legally cease to be employees whenever they choose, I think contracts can have financial implications but can't in the end stop people walking, so it would not be prudent to count people as ordinary assets.)
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Re: Bookkeeping the human factor

#3  Postby Steve » Apr 08, 2012 8:17 pm

I am just wondering if we couldn't embed a new way of thinking into our basic tools of assessment. I agree about the goodwill factor - that just says we know it is real. The hard part is quantifying it.

What I see emerging in the world is vast, and I do mean VAST, amounts of personal data that is being stored on individuals. Computers and the internet etc are changing everything. Privacy is being attacked massively. Or at least our concepts of it. It seems there might be some good aspects to it, if we could figure how to do it.
As your desire is, so is your will.
As your will is, so is your deed.
As your deed is, so is your destiny
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Re: Bookkeeping the human factor

#4  Postby zoon » Apr 08, 2012 9:44 pm

Perhaps human wellbeing is one of the commons, like clean air or countryside, which don't put in much appearance on balance sheets because they can't be owned by businesses, so they're in some danger of being pushed aside when a lot of things are changing? New ways of thinking may well be in order. I have to admit, though, that I'd be extremely nervous about losing the assumption that people are valued on a different set of principles from business assets, though I see that you have in mind to move people from being seen as liabilities (negative) to assets (positive).
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