According to the documentation on external source control, you should add all of the *.asset files to the source control repository. Since all of the asset files are binary, it becomes very problematic when commiting changes (Even with the projects source control option enabled). Especially when we have upwards to 10 developers simultaneously working on a project.
Doing several tests, it seems that it is possible to leave the MonoManager.asset out of the repositiory, as long as you import any newly added scripts. To simplify things, you could force a reimport of every script after syncing to the head of the repository.
Does this seem reasonable, or will something else in Unity explode? My greatest fear is that months of work could be destroyed by this breaking something within the prefabs and scenes that I do not know about.
The .asset files really should be converted to something that can be merged once the external source control option is enabled. It would alleviate a lot of the headaches we have ran into with source control.