"Direct Salary" Definitional Discrepancy?
I believe that there is a definitional discrepancy for "Direct Salary" between the AHPP e.15 found on page 410 and that of the Ballast/PPI ARE 5.0 Practice Questions e.2, answer 10. on page 2-6.
AHPP defines Direct labor as "Same as direct salary, Represents time charged to projects..." where Ballast defines it as "Direct salary expense is the amount paid to the firm's workforce, excluding the value of benefits such as insurance."
As I understand it, these are two completely different things. Thoughts?
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Direct salary, direct labor, direct salary expenses (DSE), and direct costs….all of these terms are limited to billable hours invoiced to the client. None of them include the cost of time spent in unjamming the copier, planning the firm holiday party, or or onboarding new employees.
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While both definitions relate to the cost of labor within a firm, they approach the concept from slightly different perspectives. The AHPP emphasizes the time spent by employees on projects, while the Ballast/PPI ARE 5.0 definition highlights the actual monetary expense incurred by the firm for salaries, irrespective of project involvement.
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