The Value Of The Rugby Players

1179 Words5 Pages
In this case, it states the difference regarding accounting treatments of the value of the rugby players in the financial statements. One treatment is to take human resource accounting method to treat the rugby stars as assets in the statement of financial position. The other one is to treat them as expenses. Both methods have their own merits and drawbacks. This report aims to analysis the above two different treatments and assess whether the accounting treatment will change after analysis the AASB 138. It also will illustrate the impact of the users on making their investment decisions of each measurement concerning the sport players. Introduction In the professional sports, there are many sport players which cost the company too much.…show more content…
In other words, the HRA capitalises the labor. There are two reasons are supported by choosing the human resource accounting. First and foremost, people are a valuable resource to a company so as they perform services that can be qualified. The firm does not need to own a person to be considered a resource. In addition, the value of a person as a resource depends on how he or she is employed; therefore, management style will also affect the human resource value. (Carme et al. 2011) Despite the above two reasons, as Unruh and Mathews (1992) pointed out, a vast of studies have established that all users of financial statements would gain some benefits from the HRA. Firstly, it provides methods of measuring costs and effectiveness of human resource policies. Furthermore, investors could get information regarding an enterprise’s human assets via HRA. Moreover, it offers information facilitation corporate social accountability. Lastly, it presents information about the cost and the value of personnel to a firm. (Geoff 1996) Meanwhile, HRA can assist managers in making decisions on the recruitment, layoff or job cut of the employees. It provides three functions: ‘it provides numerical information about the cost and value of people as organizational resources. It serves as an analytical framework to
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