History of Accounting - Latest Articles
Step right up to the Great Accounting Ride. No crowds.…
Accounting may be as old as civilization. As wealth was…
Unlike most other modern professions, accounting has a history that…
Step right up to the Great Accounting Ride. No crowds. Sponsored by your favourite Big Six firm and Fortune 500 company. Jump in a car; off we go. We start at the dawn of civilization. Mud and wood huts, the village is planting seeds for grain crops. It’s the late stone age, but real progress is evident. The village potter is bartering with a wandering shepherd, the beginning of commerce.
Climbing slowly, we move on to the small settled village of Jericho some 10,000 years ago for a Dead Sea stroll. The village…
Accounting may be as old as civilization. As wealth was accumulated, inventories of wealth were needed. Writing was invented as a convenient way to track commercial transactions and accumulated assets in an abstract way.
The “inventions” of money, banking, and credit took place and were important components of a rise of the great civilizations of the Ancient World. The Medieval Italian merchants became wealthy and powerful, partially as a result of the development of double entry bookkeeping. The Industrial Revolution, starting in the 18th century in England, led to mass production, big business,…
Unlike most other modern professions, accounting has a history that is usually discussed in terms of one seminal event - the invention and dissemination of the double entry bookkeeping processes. But a view of accounting history that begins with Luca Pacioli’s contributions overlooks a long evolution of accounting systems in ancient and medieval times.
More fundamental is the question, why should we care about the history of accounting at all? Certainly a glimpse back into this period helps illuminate our past generally, and it is the sort of winding, twisted path that makes…
In attempting to explain why double entry bookkeeping developed in 14th century Italy instead of ancient Greece or Rome, accounting scholar A. C. Littleton describes seven “key ingredients” which led to its creation.
- Private property: The power to change ownership, because bookkeeping is concerned with recording the facts about property and property rights.
- Capital: Wealth productively employed, because otherwise commerce would be trivial and credit would not exist.
- Commerce: The interchange of goods on a widespread level, because purely local trading in small volume would not create the sort of press of business…
Five thousand years before the appearance of double entry, the Assyrian, Chaldaean-Babylonian and Sumerian civilizations were flourishing in the Mesopotamian Valley, producing some of the oldest known records of commerce. In this area between the Tigris and Euphrates Rivers, now mostly within the borders of Iraq, periodic floodings made the valley an especially rich area for agriculture.
As farmers prospered, service businesses and small industries developed in the communities in and around the Mesopotamian Valley. The cities of Babylon and Ninevah became the centers for regional commerce, and Babylonian became the language…
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