Many years ago, a well-known American company publicly advertised with the slogan "Our most important asset is our employees". More recently, other companies have realized that quality employees working in an excellent work environment that respects those employees produce quality products at a reasonable cost. Although this may be the foundation for American companies to become more internationally competitive, there is no recognition of an employee asset on the balance sheet. Why is there not an asset on the balance sheet that recognizes the contribution of employees to the future profit-making ability of a firm?

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The Answer of Many years ago, a well-known American company publicly advertised with the slogan "Our most important asset is our employees". More recently, other companies have realized that quality employees working in an excellent work environment that respects those employees produce quality products at a reasonable cost. Although this may be the foundation for American companies to become more internationally competitive, there is no recognition of an employee asset on the balance sheet. Why is there not an asset on the balance sheet that recognizes the contribution of employees to the future profit-making ability of a firm?

Many Years Ago, a Well-Known American Company Publicly Advertised with the Slogan