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Can a human be an asset for the business
11-30-2004, 01:51 AM
Post: #1
Can a human be an asset for the business
Hi forum fellows

This forum is really very helpful and i think we (accountancy student) don’t need any tuition caz we can ask everything in this forum.

Can anybody please tell me that a human can be a asset for the business or not. if answer is yes then how the depreciation will be charged becaz nobody know the age of human and if he dye then what kind of accounting treatment will be used for him
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11-30-2004, 03:22 AM
Post: #2
 
hi Problim

The correct spelling is "problem"

What a strange question, no you would not capitalise your workforce for the reasons you have stated!

I think irrespective of the resources available such as forums, you would benefit from tuition!

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11-30-2004, 05:42 AM
Post: #3
 
Good question.......My answer would be YES

I would explain it tomarrow caz now i havent got enough timeto explain it.



Edited by - sajjad_dar2000 on Nov 30 2004 61754 PM
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11-30-2004, 07:04 AM
Post: #4
 
human beings cannot be considered as an asset...

Ace
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11-30-2004, 07:32 AM
Post: #5
 
"an asset is a resource controlled by the enterprise as a result of past events and from which future economic benefits are expected to flow to the enterprise"

an intangible asset is an identifiable non monetary asset without physical substance and should also comply with the definition of an 'asset' (as stated above)

so you cannot count 'human resource' as an asset which means you cannot capitalise or depriciate it. the same is with market share and customer loyalty etc (BPP)
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11-30-2004, 08:40 AM
Post: #6
 
ohh..my friend sajjab darr ...plz tell us yarr...how can a human be a fixed asset inshallah it will help all of us to increase our knowledge

Never seek advice from a Chartered Accountant. They are trained to find problems not solutions.
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11-30-2004, 08:08 PM
Post: #7
 
<font face='Verdana'>
salaam all,

dear friends, human resources r one of the most important asset for a company. the departments of HRM n personnel mgmt. r meant for managing all the affairs related to it. according to a survey report in USA, the managrs of HR get 70% of the entire salary budget of top US companies. [referrence personnel management by Flippo]

the CFO of johnsons&johnsons once said (i dont remember his name right now) that "... n the company with best business people will win ... " [reference same as above]

this highlights the importance of human resources. HR is considered to b intangible assets because it r the abilities n talent of the ppl (n not the ppl themselves) tht make the impact. company hires them for their abilities n exploits these abilities for the benefits of the company.

HR might not b considered in accounting exactly like other assets (eg cash) bcoz HR r non-material in nature. so they r not represented in any "accounts" form. rather, accounting treats them as an expense!!!! by creating payrolls, n salaries expenses, n etc etc etc. but the trend has started to change, specially in big multinationals.

i got to know from somewhere, in last few days, tht ICAP has arranged a seminar abt for highlighting the importance of HR n its utilization for benefits of company, n the director of human resource dept of a big multinational addressed it also.

many of us might know tht a new dimension in accounting is evolving, called Human Resouece Accounting (HRA). i read an article abt it in DAILY DAWN atleast 2-3 yrs back. so i dont remember it exactly, but, the definition of HRA was given as HRA tries to evealuate the human resources, possessed by a company, in terms of $ amount ie monetary equivalence.

many of u might already know tht Unilevers Pakistan has just established a Day-Care centre for infant kids in the premises of the company!!! just to retain their valuable female members from resigning just bcoz of th kids

in short, HR r the most important resource of a company. many big companies have suffered bcoz of lack of good managers or inabilities of their workforce etc etc.

</font id='Verdana'>

FARHAN

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11-30-2004, 09:51 PM
Post: #8
 
<BLOCKQUOTE id=quote><font size=1 face="Verdana, Tahoma, Arial" id=quote>quote<hr height=1 noshade id=quote>
hi Problim

The correct spelling is "problem"

What a strange question, no you would not capitalise your workforce for the reasons you have stated!

I think irrespective of the resources available such as forums, you would benefit from tuition!

--------------------------
See Ya
-)
Visit http://www.accountancystudents.co.uk
<hr height=1 noshade id=quote></BLOCKQUOTE id=quote></font id=quote><font face="Verdana, Tahoma, Arial" size=2 id=quote>

Well! i know the spelling of problem but i wrote problim so dont worry...........as for as strange question is concern, READ THE REPLIES.......i am still waiting for Sajjad Dar's respond

Problem Creater
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11-30-2004, 10:33 PM
Post: #9
 
What are you a spoof?

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11-30-2004, 11:14 PM
Post: #10
 
Hi PRO CREATER

In some cases human can be an asset. Few month ago Manchester United (Football club) and Rooney (football player) singed and agreement for five years. Manchester United paid him in millions and Rooney will play for the club. Now Rooney will appear as an asset in balance sheet of Manchester United or we can say Rooney is Asset for Manchester United.

Definition of Asset
Assets are right or other access to future economic benefit as a result of past transaction.

According to above definition Rooney is an Asset because -
1) Right to future economic benefit...Rooney will play football for Manchester United and club will earn the revenue
2) Because of past transaction...Rooney paid (purchased) some time in past.

Here we assume that Manchester United signed Rooney for five years and paid him five millions. Now Manchester United cant put five million as an expense because five millions have been paid for five years therefore Rooney will appear as an asset. Not just the Rooney but also all top football players are asset for the club.

Depreciation
Because Rooney has been paid for five years (Asset) therefore five million will be expanded on to five years. Depreciation will be charged on the length of agreement not the age of Rooney. I think straight-line method will be used for the depreciation therefore depreciation charge will be 1 million per years (5 million over 5 years).

In the cause of Rooney’s death during the agreement period he will be treated same as other assets (disposal).


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12-01-2004, 11:00 PM
Post: #11
 
Thanks Sajjad for yur reply.............and all other forum member
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12-02-2004, 08:34 AM
Post: #12
 
good yarr sajjad...nice example )


Never seek advice from a Chartered Accountant. They are trained to find problems not solutions.
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12-02-2004, 10:01 PM
Post: #13
 
Not agreed wid sam........

Manchester United paid him (Rooney) five million at once they would not pay him anymore during the five years. They can not put that expense in any single year they have to expand five millions in five years. Football club (Man United) dont pay them (football players) salry they hire them for some period.

If you think FOOTBALL is asset than its wrong FOOTBALL is an expense caz you cant use football for long term.

anyway i am a student of ACCA part I & II and i know that still i havent got enough knowledge of accountancy. whatever i said above have been told by my teacher who is well qualified.


Regards

Sajjad Dar
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12-02-2004, 10:05 PM
Post: #14
 
i even can prove from ur reply that human can b an ASSET but i am so bussy now due to ACCA exams so i would discuss this after 13 december.


Sajjad Dar
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12-02-2004, 10:08 PM
Post: #15
 
Grounds the Soccor Team owns including Clothings, Materials used to play equipment that team uses for clean the ground for practice purpose, shoes,shin guards,socks,buildings for the team that it uses,Transport Van and all other material that team uses to keep in fit.
_____________________________________________________________________


All above things are expense except building and Van


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Sajjad Dar
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