History of Accounting

Part 9 - Significance of the Summa

In the first century after its publication, the Summa was translated into five languages, and numerous books on double entry bookkeeping appeared in Dutch, German, English and Italian whose descriptions were obviously lifted from “De Computis.” Many consider these works inferior explanations of the system so clearly articulated by Pacioli.

One historian has described the works issued during this period as, “at the best, revisions of Pacioli, at the worst servile transcriptions without even the courtesy of referring to the original author.” Nevertheless, they helped quickly spread the knowledge of the “Italian method” throughout Europe.

Perhaps most surprising is how little bookkeeping methods have changed since Pacioli. Both the sequence of events in the accounting cycle and the special procedures he described in “De Computis” are familiar to modern accountants. In fact, the primary differences between current bookkeeping practices and the “Method of Venice” are additions and refinements brought about by the needs of a larger scale of business operation.

The small proprietorships of 15th century Italy had no need for specialized journals, subsidiary ledgers, controlling accounts, formal audit systems, cost accounting or budgeting. Some omissions, such as the failure to touch on accruals and deferrals, probably occurred because Pacioli felt they were too advanced for a beginner’s treatise. But numerous tiny details of bookkeeping techniues set forth by Pacioli were followed in texts and the profession for at least the next four centuries, as accounting historian Henry Rand Hatfield put it, “persisting like buttons on our coat sleeves, long after their significance had disappeared.”

Article courtesy of John R. Alexander at Net Gain