Personnel costs These are the costs incurred by an organization for its employees. They consist of wages and salaries, social benefits, and other personnel costs. Personnel costs can always be attributed to a specific employee and a specific period.
Components
Personnel costs also include insurance contributions to pension, health, nursing care, unemployment and accident insurance funds. Most often, employers and employees share these contributions. Only the portion paid by the employer is included in personnel costs. The accident insurance is borne by the employer alone; the relevant professional association sets the contribution rate. Voluntary social benefits are only included in personnel costs if they directly benefit the employee, such as voluntary pension plans. Indirectly incurred benefits, such as a canteen, are recorded in the cost accounting as other types of costs. Other personnel costs usually arise from personnel changes, for example through severance payments or the recruitment of employees.
The employer’s costs for an employee consist of the gross wage, the employer contributions to social security, the contributions for maternity benefits and wage continuation (U1 and U2), the insolvency fund contribution and the contributions to the occupational health insurance association. The personnel costs also include the calculated entrepreneurial salary. It is a special case in partnerships and sole proprietorships, because only there can owners work for their company without payment.
In cost accounting
A company pays production wages to employees who work directly in production. These are individual costs and can be directly attributed to a product. However, auxiliary wages for auxiliary work in production are general costs that are deducted from the cost accounting. Wages and salaries cannot always be clearly allocated to fixed or variable costs. The salaries of administrative staff are considered fixed costs, whereas bonus or performance-based bonuses are based on performance. Temporary workers cost more than in-house employees, but their costs are variable.
Some parts of personnel costs are charged irregularly, for example special payments. Therefore, cost accounting estimates these amounts at the beginning of the billing period and distributes them proportionally (monthly or time-based). A numerical example: Ten employees receive 3,000 euros per month, including social security contributions. In addition, they receive 50 percent each as vacation pay in June and as Christmas pay in December. The annual total is 390,000 euros. Therefore, cost accounting incurs 32,500 euros every month.
In service companies, personnel costs can account for 80 percent of the total costs and more. Common metrics include personnel costs per unit, personnel costs as a proportion of revenue, and personnel costs per employee.
In financial accounting
Payroll accounting records personnel costs. It is a subsidiary accounting function within financial accounting. In the expense account, payroll accounting records all gross wages, including employee contributions to social security and before deducting payroll taxes. Employer contributions to social security are recorded in a separate account.
In the profit and loss account according to the full cost method (§ 275 HGB), the corresponding item is personnel costs. It is divided into wages and salaries as well as social security contributions and expenses for retirement and support. The cost of sales method, on the other hand, divides the costs according to functional areas and does not include a separate item for personnel costs.
Link to the post
According to the article, an internal accounting department incurs personnel costs and additional infrastructure costs. According to the article, payroll processing, vacation replacement, sick leave, and the recruitment of qualified accountants tie up time and planning capacities. According to the article, service contracts can be scaled or adapted as needed, whereas labor-law-bound personnel cannot be.
Demarcation
The cost accounting section talks about personnel costs, the profit and loss account uses the total cost method to calculate personnel costs. Related entries: Payroll accounting, payroll entries / SAP Business One, payroll tax declaration, fixed costs, variable costs (SAP Business One), external accounting, internal accounting.
Sprint and Swirl: How an AI agent divides work and learns from trials
LATS: Considering several paths simultaneously with AI — and the availability check in SAP B1
ReAct and RLEF: How Artificial Intelligence Learns from Real Mistakes — and What Automated Bank Reconciliation in SAP Business One Has to Do with It
SAP B1 10.0 FP2608: Service Layer AI as a transactional layer
Process Reward Models: Why a correct result does not yet prove a correct method
