Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients." - Richard Branson.

Introduction: In the complex realm of Business Finance, a thought-provoking debate emerges: Should humans be considered tangible assets? When delving into the topic, various dimensions unfold, showcasing the importance of humans in driving a company's value and the ethics surrounding their categorization. This blog post dives deep into the concept of "Human Assets in Business Finance" to shed light on this ongoing discourse.

Understanding 'Human Assets': Human assets aren't your typical assets listed in a company's ledger. They aren't like machinery, buildings, or patents. Human assets embody the knowledge, skills, creativity, and the intrinsic value every employee brings to a company. This concept goes beyond monetary worth, accounting for the unique perspectives, problem-solving abilities, and interpersonal skills that drive innovation, teamwork, and success.

The Value Proposition: Every employee, regardless of their designation or department, contributes in some manner to the company's bottom line. Be it through innovation, customer interactions, or even morale-boosting, the human element plays an undeniable role in a company's success. This invaluable contribution made by humans puts forth a compelling argument for treating them as tangible assets.

Ethical Implications: However, the notion of "placing a value" on human assets sparks ethical concerns. By viewing employees merely as 'assets', are businesses reducing their worth to mere numbers on a balance sheet? Marsal (2020) rightly argued that humans aren't just tangible resources - their value goes beyond physical presence. They contribute in ways that cannot be quantified, such as through innovation and creativity.

The Accounting Perspective: While the ethical debate rages on, it's worth noting the practical implications of this concept from an accounting perspective. If humans were to be considered assets, how would one go about valuing them? Would this value be based on their salary, their potential future earnings, or perhaps the value of their intellectual contributions?

Conclusion: "Human Assets in Business Finance" is more than just a concept—it's a debate about the value of humanity in the corporate world. While humans undoubtedly drive businesses forward, treating them as tangible assets remains a controversial and ethically charged topic. As the discourse continues, one thing remains certain: humans, in all their complexity, are the true backbone of any successful business endeavor.

Remember, the way businesses treat their employees directly correlates with their growth and success. After all, in the wise words of Richard Branson, "Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients."

Delve into Business Finance MOD003319 Essay Question to unravel this and other financial conundrums.

 

 

Essay Sample:

 

 

Task 1

The concept of placing a value on the human assets of a business and including it on the statement of financial position is debatable. Although humans facilitate the success and productivity of a business, treating them as assets raise ethical, conceptual, and practical issues. According to Marsal (2020), humans are not tangible resources such as equipment or property. They possess unique skills, knowledge, and capabilities that contribute to the value and growth of a business. The value that humans bring to a business goes beyond their physical presence. Their unique perspectives, problem-solving abilities, creativity, and interpersonal skills enable them to contribute to the innovation, teamwork, and success of a company (Todericiu et al., 2014). As such, human resources play a critical role in driving productivity, efficiency, and competitiveness in organisations.

In addition, Takahashi (2022) indicates that treating humans as assets… Read More