History of Accounting

Early Civilizations

Accounting history began around 3000BC and it is evidenced by the record-keeping wealth thru "clay tablets" of Mesopotamia...read more 

In the CMO3 S2007, History of Accounting has the following outline for discussion:

1.6.1  Florentine Approach vs Venetian Approach to Reporting

The Florentine Approach is the introduction of double-entry bookkeeping system.

It was in the 14th century when Amanito Manucci, a partner of merchant partnership, created a recording system where there's at least one account debited and one account credited and where the total of debits equals the total of credits. Notice that this system of recording is the system of double-entry bookkeeping...read more

1.6.2  Savary and the Napoleonic Commercial Code

Savary Commercial Code

Jacques Savary (1622 - 1690)

Savary belongs to a French family dedicated to trade and publication of works related to commercial matters.

He has broad involvement and experience in and out of royal service...read more

1.6.3  The industrial revolution and the share-issuing company

The industrial revolution (late 18th and early 19th century) was the eras when there are major changes happened in the economy which has a profound effect on socio-economic and cultural conditions in Britain and throughout the world especially in the areas of agriculture, manufacturing, and transportation...read more

1.6.4  The arrival of income taxation and the conflict with financial accounting

It was in AD 10 when the fist known income tax was instituted by Emperor Wang Mang (45 BC-AD of Xin Dynasty of China, where the income tax rate is 10% flat rate of profits.

While the first graduated income tax system from 8.33% to 10% was implemented in 1798 in Britain by William Pit (the Younger) in his budget to pay for weapons and equipment in preparation for the Napoleonic wars...read more

1.6.5  Schmalenbach and the chart of accounts

Since the World War II, chart of accounts have played a vital role in the development of accounting in Poland.

A writer and professor at Cologne, named Eugen Schmalenbach (1873-1955), believed that chart of accounts are not mere carriers of balances but it contains significant information which can be prepared regularly and speedily to respond rapidly to the external and internal circumstances infleuncing the economic issues of an enterprise...read more

1.6.6  The rise of the group of companies and the need for consolidated accounts

Since the end of World War II, rapid growth of domestic and multinational corporations in various countries was observed.

Noticeably, with the global inclinations of business, organizations not just build new facilities and infrastructures but also most previously separate entities combine or group themselves together. Hence, there were several business combinations here and there...read more

1.6.7  Internalization of markets and reporting

Markets now are coming from all over the over the world because of globalization.

Exchange of transactions and business dealings are now done anywhere and everywhere ignoring global barriers and constraints.

Especially now that almost everything can be transacted online via world wide web or internet...read more


Note, click each topic to read its full discussion.