b_slap99
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because they cost money, assets are valued holdings. |
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NC
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Companies do not own employees; the employees are free to leave if someone else offers them better jobs. Also, many companies are required to pay for employees' (and retirees') healthcare; pensions to retired employees are not uncommon, either.
When a company falls on hard times, assets can be sold; employees, in contrast, have to be given severance pay. |
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O'Baby
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Because the employers have to pay their employees (Payroll Expense). |
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jadeearthchild
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An employee is considered an expense because the money in wages that are paid out are an expense the company must pay. Therefore regardless of the benefit to the company it is still considered an expense to pay an employees wages. Thus qualifying as a liability on the books as opposed to an asset. |
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blkrose65
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because you have to pay them! and you have to pay FOR them! Health care costs, travel expenses, severance pay....the cost of training new hires and retraing current employess.... |
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cookiesmom
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all the answers are true and good but think of it this way....everyone is expendable and noone is irreplacable |
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Susan O
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because you don't own them, therefore they are not YOUR assets, and because you have to pay them, therefore they are your liabilities just like accounts payable |
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cvq3842
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I guess it's because you have to pay employees but don't own them. Maybe somehow it would show up in goodwill - the value of a business over and above the value of the assets - if you had an unusually valuable workforce or program. I dunno. |
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kja63
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Unfortunately, we're expenses. As a rule, employees are usually more than 1/2 the total expenses of a company. That makes us a liability on the balance sheet. |
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smcmsam
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Employees cost resources and must be paid with a salary, insurance, and retirement benefits. We use furniture, lighting, supplies, etc. that could all be allocated somewhere else. |
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Darby
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Because money is paid out to cover wages, benefits, etc., as opposed to being received by the business. |
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cyclist
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Because the financial statements are using the Accounting term "assets" not the generic. In accounting terms, assets are owned and depreciated or expensed. |
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ThePeskyWabbit
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Employees are paid salaries - and the salaries are an expense to the company. They are paid out of the gross income. Employees are just like equipment, except copy machines don't have to have dental, medical, and 401Ks. |
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guj1982
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Although employees don't show up on the balance sheet (because, I think, you can't put a dollar value on people), when someone purchases the business, a good workforce definitely increases the price of the business. Business valuation (the selling price of a business) is usually based on annual sales, net income, or something of that sort. The better the workforce, the better the profitability, the higher the selling price. |
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Trapshooter
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because a employee is not owned by the company, and their pay is a expense. |
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knieveltech
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That's because employees can't be classified as corporate "property", thus they are relegated to the category of unrecoverable spend, an extremely shortsighted stance on the part of business that's one of the prime driving forces behind the erosion of worker's rights and benefits programs. </soapbox> |
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