Financial Statements & The Basics
Tracking where money comes from and goes, this foundational statement shows revenue, expenses, and profit or loss
What is the Income Statement
Measuring the gross operating margin generated for every dollar spent on human capital costs.
What is Human Capital Return on Investment or HCROI?
Also known as the Revenue Factor, this metric measures how much revenue is attributable to each full-time employee unit.
What is Productivity (or Revenue Per Employee)?
In dealmaking, this term specifically describes a transaction where a large company owns a smaller one, as opposed to a merger which creates a "hybrid 2.0 entity".
What is an Acquisition?
This student is a Cornell graduate who co-founded “Happy Feet 4 Kidz” and is interested in law, labor relations, and public advocacy.
Who is Olivia Odukale?
This accounting method matches sales with associated costs and is complex and precise, unlike the simpler cash method.
What is Accrual Accounting?
This metric shows the average financial profit that an average, single full-time employee brings to an organization.
What is Human Capital Value Add (HCVA)?
A fundamental measure of the costs attributable to each employee, an increase in this factor may be due to labor or other business expenditures.
What is the Expense Factor (or Expense Per Employee)?
Despite strategic drivers for value, this staggering percentage of all M&A deals fail, resulting in significant losses for the acquirer.
What is 70%?
This student has experience in Learning & Development, DEI, and executive recruiting and wants to build scalable people systems.
Who is Catharina Wulandari?
These are the "Big Three" financial statements that are critical for Human Capital Management leaders to master.
What are the Income Statement, Balance Sheet, and Cash Flow Statement?
When calculating metrics like HCVA and HEVA, you must divide the total by this abbreviation, which represents the workforce unit and includes contracted employees.
What is FTE (Full-Time Equivalents)?
Combining the Revenue Factor and Expense Factor helps you understand this ultimate per-employee financial metric.
What is the Income Factor (or Income Per Employee)?
"Pay Practices," "Labor Rights," and "Health & Safety" fall under this specific pillar of ESG.
What is the "S" (Social) Pillar?
This student has more than six years of recruiting experience and specializes in matching people to both tech and non-tech roles.
Who is Fadel Qadrian?
To bridge the gap from net income to operating cash flow, you must adjust for non-cash expenses, such as stock-based compensation and this specific expense.
What is Depreciation?
Calculated as [NOPAT – (Invested Capital x WACC)] / FTE, this metric reflects the isolated impact of human capital on financial performance and market value.
What is Human Economic Value Add (HEVA)?
A decline in the productivity metric signals that either revenue has declined, or that leaders need to review this workforce dynamic.
What is the composition or number of employees?
This 2020 rule mandates that public US companies describe material human capital resources, including employee counts and attraction/retention objectives.
What is the US SEC (Securities and Exchange Commission) Human Capital Rule?
This student is a second-generation Chinese-American from the West Coast who believes that a data-forward HR system can create competitive advantage.
Who is Annie Wang?
Modern business value is largely driven by human capital rather than physical assets, with 90% of S&P 500 Market Value now consisting of these.
What are Intangible Assets?
This human capital ratio provides information about the market value premium per FTE and is typically of interest to investors.
What is Human Capital Market Value (HCMV)?
The "Expense Factor" aligns with financial efficiency ratios like Working Capital Turnover, Receivables Turnover, Payables Turnover, Asset Turnover, and this specific inventory-related ratio.
What is Inventory Turnover?
In due diligence, taking a "Macro View" results in comprehensive scorecards and baseline links by analyzing these indicators over the last two years.
What are KPIs (Key Performance Indicators)?
This beloved course TA co-teaches Finance for Human Capital Management and holds both SHRM-SCP and Certified Diversity Executive credentials.
Who is Dennis Alvarado?