In a newspaper article entitled ‘NAB slashes to brace for digital threat’ (by Clancy Yeates, The Age, 3 November 2017, p. 20), it was reported that:

National Australia Bank chief executive Andrew Thorburn is unleashing a $1 billion cost-cutting drive he says is needed to prepare the bank for a world of tougher competition and economic conditions. Mr Thorburn said up to 6000 jobs would be lost over the next three years as part of a plan to slash expenses while investing in new technology, including by using automation to replace work done by people.

REQUIRED

The slashing of so many jobs will likely cause various social impacts. Referring to the definitions of the elements of financial accounting, why are such social costs not considered to represent ‘expenses’?