The balance-sheet approach to compensation refers to designing pay systems that equalize the purchasing power of employees at comparable position levels living overseas and in the home country.

Question

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The statement accurately describes the balance-sheet approach to compensation, which aims to ensure that employees living and working overseas are compensated at a level that allows them to maintain a similar standard of living to what they would experience in their home country. This approach typically involves taking into account differences in the cost of living, taxes, and other factors that can affect an employee's financial situation when working abroad.

The Balance-Sheet Approach to Compensation Refers to Designing Pay Systems