...Accounting history is important because it is the most important professions in economic, business and cultural development. It sum of all the events--that have happened in accounting field. This sum guides our actions in the present in accounting profession. Accountants invented writing, involved development of money and banking, innovated the double entry bookkeeping system that fueled the Italian Renaissance, saved many Industrial Revolution inventors and entrepreneurs survive, participated in the development of the capital markets necessary for western capitalism. In the 20th century, accounting had changed into a profession that brought credibility for complex business practices that sparked the economic, and as a platform to the information revolution that is transforming the global economy . Most of us don’t know the names of accounting innovators; in reality, there are no names were known before the Italian Renaissance. The early history and scholars from many fields showed the importance of accounting to so many aspects of economics and culture in the past. Archaeologists discover the interpretations of the artifacts of the ancient accountants, and it is developed over 5,000 years. Accounting was main factor to the success of Italian merchants, necessary to the birth of the Renaissance and Industrial Revolution firms. Nowadays, a global economy integrated information system is a reality, creating new accounting paradigms. Understanding accounting history is...
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...Accountancy is the production of financial records for organizations and shows readers in money terms the economic resources the company has under its control and represents it in terms of relevance and does this faithfully. Accounting is called “the language of business” because it acts as a vehicle for a business entity to report their financial information to groups of people outside of the company’s day to day activities. Some researchers believe the earliest instance of accounting was from a cave engraving in South Africa that was dated 76,000 years old. However the earliest proven accounting records have been dated back 7,000 years ago and were found in Mesopotamia. The people of the time relied on its primitive practices to record the growth of crops and herds. In Iran during the 4th and 3rd century, socioeconomic situations led to unequal distributions of wealth and so the leaders and priests appointed people to look after the financial matters. Godin Tepe, an archaeological site in western Iran, scripts only containing tables with figures were found. In Tepe Yahya, an archaeological site found in the Kerman Province in Iran, the scripts contained geographical representations as well. In both sites buildings containing large rooms for storage crops had tokens that were used for bookkeeping purposes on clay scripts which represented a cognitive leap for mankind. (Accountancy, n.d.) These early practices of record keeping were used mainly for the record keeper and...
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...Jose Dejesus Dr. Steven Taylor English 11 D22 3/3/2014 2nd Paper Accounting: the need of bringing accounting history into classrooms Would introductory accounting students benefit from the lessons and experiences found in accounting history? That’s how the article “Financial Accounting Courses: An exploratory study” by Satina V. Williams and Bill N. Schwartz starts. According to studies made by Williams and Schwartz, students would better understand the political, economic and cultural issues affecting the development of accounting if they were exposed to the history and evolution of accounting through the years. They also suggested that gathering historical information in the beginning of the course of accounting may stimulate students to learn more about how accounting is actually working (Williams 198). After looking at records and seeing that many students are receive a degree without knowing the history of accounting, they conducted a survey to determine how they can get the history of accounting into the classrooms. After contacting 100 school’s accounting department administrators, they found 79 faculty members to ask for their opinions about incorporating accounting history into undergraduate introductory financial accounting classes. If they can get the majority of firms they might be able to bring accounting history into classrooms. They received 49 responses and 24 of them were in agreement...
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...“The History of Accounting” Accounting is one of the oldest professions and the growth and spread of the profession can be paralleled with the growth and spread of Western Civilizations. Through archaeological discoveries the use of accounting can be dated back almost 7,000 years ago. Many of today’s accounting practices came from the Italian Renaissance. The sophistication of double entry accounting was accompanied by an overwhelming demand for professional accountants to follow the guidelines. The expanding profession of accounting really took off with the coming of the Industrial Revolution in America. The use of accounting practice has been around for ages and the growth of the use and practices can be seen to reflect the growth of trade, cities, and the concepts of wealth and numbers. Ancient Mesopotamian artifacts that date back over 7,000 years ago, give proof that primitive accounting techniques were used to record the growth of crops and herds on clay tablets. The Roman Empire kept records of cash, commodities, and transactions on papyrus rather than clay because it allowed more detail to be kept. “The Great Roll of the Exchequer” which is also called the “Pipe Roll” was kept during the Medieval Times and provided an annual description of rents, fines and taxes due to the King of England. Although these practices are not reflected in modern day accounting, it definitely contributed to the need for detailed records for various transactions. Widely acknowledged to be the...
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...University of Wollongong Research Online Faculty of Business - Accounting & Finance Working Papers 2006 Faculty of Business The Critique of Accounting Theory M. Gaffikin University of Wollongong, gaffikin@uow.edu.au Publication Details This working paper was originally published as Gaffikin, M, The Critique of Accounting Theory, Accounting & Finance Working Paper 06/25, School of Accounting & Finance, University of Wollongong, 2006. Research Online is the open access institutional repository for the University of Wollongong. For further information contact the UOW Library: research-pubs@uow.edu.au 06/25 University of Wollongong School of Accounting & Finance The Critique of Accounting Theory Working Papers Series Michael Gaffikin School of Accounting & Finance University of Wollongong Wollongong NSW 2522 Australia Tel +61 (2) 4221 3718 Fax +61 (2) 4221 4297 eMail george@uow.edu.au www.uow.edu.au/commerce/accy/ The Critique of Accounting Theory Michael Gaffikin* School of Accounting and Finance, University of Wollongong, NSW 2522 In previous papers (Gaffikin 2005a, 2005b, 2005c, 2006) the discussion has examined accounting as a science, with attempts to employ a scientific methodology; as a purely technical expression of economic theory, heavily dominated by research in finance; and as part of “law”, albeit law (regulation) heavily influenced by dominant economic and political ideology. That discussion revealed that all these perspectives...
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...(Tom) ROWLES B.Ec (Hons), Dip.Ed (Monash) A THESIS SUBMITED FOR THE DEGREE OF DOCTOR OF PHILOSOPHY IN THE SCHOOL OF ACCOUNTING AND LAW OF RMIT UNIVERSITY, MELBOURNE, VICTORIA, AUSTRALIA ii DECLARATION I certify that: Except where due acknowledgement has been made, this thesis is mine alone; and The work has not been submitted previously, in whole or part, to qualify for any other academic award; and The content of the thesis is the result of work that has been carried out since the official commencement date of the approved research programme. THOMAS R. ROWLES iii TABLE OF CONTENTS Chapter Introduction 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9 Introduction Purpose of the Study Sombart’s Hypothesis An Alternative Model; Entrepreneurial Decision-making Context: The Industrial Revolution and ‘Profit’ The Changing Nature of ‘Investment’ The Great Depression of 1873-96 Intellectual Introspection Irving Fisher and the Conception of Capital and Income 17 17 17 23 25 26 30 32 34 34 35 36 38 38 38 39 43 46 49 50 51 54 55 1.10 Research Issues Identified 1.11 Summary Derivation of Research Issues 2.1 2.2 Introduction Evidence from Extant Accounts 2.2.1 Fixed Assets in Mercantile Accounting 2.2.2 The East India Company 2.2.3 Fixed Assets and Early Industrial Accounting 2.2.4 Capital Asset Accounting After 1870 2.2.4.i Renewal Accounting 2.2.4.ii Double-Account System 2.2.4.iii A Rejected Hypothesis 2.3 Steam and Iron: the ‘Railway Age’ iv 2.3.1 ‘Loco...
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...14th Century The history of accounting dates back to ancient civilisations, however the birth of double-entry bookkeeping in the 14th century is seen as being the beginning of the modern accounting period. The Renaissance period in Italy (14th to 16th century) saw many major developments in accounting practice. At this time, Arabic numerals were first used to keep records of business transactions in place of Roman numerals, and record keeping developed on a large scale. Bookkeeping had to develop to keep track of the assets and profits of many distinct trading ventures at different stages of completion. In 1657, the company ruled that stock was to be valued, and four years later the governor of the company stated that “future distributions would consist of the profits earned (dividends) and not “divisions” as in the past”. Many guides for investors and accountants were written during this development period. Examples include Stock Exchange Accounts; with an appendix of forms which details stock exchange bookkeeping, Haight and Freese Co’s Guide to Investors which lists the stock prices for various companies between 1890-1900 18th Century Josiah Wedgwood, the founder of famous pottery manufacturer Wedgwood is considered by many to be a pioneer in cost accountancy. After examining business accounts, Josiah Wedgwood discovered that his head clerk had been embezzling from the company 19th Century The early evolution of accounting was dominated by advances in...
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...Del mundo real de aplicaciones Macroeconomía se suele utilizar para determinar la salud de la economía de una nación mediante la comparación del PIB de un país y su producción total o gastos. El PIB es el valor total de todos los bienes y servicios finales producidos legalmente en una economía en un período de tiempo determinado. Así, una región se considera de mejor salud cuando la proporción del PIB a gastos es mayor, lo que significa en términos laicos que una nación está trayendo más de lo que pone. Otra medida utilizada es el PIB per cápita, que es una medida del valor de todos los bienes y servicios, dividido por el número de participantes en una economía. Esto se utiliza para determinar el nivel de vida y el grado de desarrollo económico de un país, donde un mejor nivel de vida y un mayor desarrollo económico vendrá a medida que más personas tienen un mayor valor de producción total. Por ejemplo, los EE.UU. y China tienen un PIB global similar, pero los EE.UU. tiene un mucho mejor el PIB per cápita, debido a sus muchos menos participantes económicos, lo que refleja el alto nivel de vida en los EE.UU. Macroeconomía también se utiliza para desarrollar estrategias de mejora económica a nivel nacional y mundial. Microeconomía se utiliza para determinar el mejor tipo de opciones que una entidad puede hacer para obtener el máximo beneficio, sin importar el tipo de mercado o arena que está involucrado en. Microeconomía también puede ser considerado una herramienta para la...
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...Development in Accounting Theory * General Scientific Period (1800-1955) * Normative Period (1957-1970) * Positive Era (1970s) * Behavioral Research (1980s) Evolution of Double-Entry Book Keeping * Early History of Accounting * 4500-3600 BC -Chaldean Babylonion -Assyrian and Sumerian Egyptian -Chinese( Chao Dynasty) -Greek -Roman * 11th to 13th century -Italian Renaissance * Luca Pacioli’s Contribution * Introduction of double-entry book keeping, Dr and Cr were used for entries to secure double entry. * Three book are used: -memorandum -journal -ledger * Development of double entry * 16th Century: a few changes are made in the book-keeping techniques. * 17th Century: separate inventory accountant for different types of goods. * 18th Century: Three methods of treating fixed assets * 19th Century: depreciating property was accounted for unsold merchandise 4 reasons generally advance to explain the role of double-entry in the economic expansion: * Double-entry contributed to a new attitude toward economic life. * The acquisition was aided and propelled by systematic organisation. * It permits a separation of ownership and promotes the growth of the large joint stock company. * The new rationalism was further and enhance by systematic organization. Capitalism and Accounting * the linked between accounting and capitalism become known as the Sambart thesis or argument that the tranformstion...
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...More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. More Than a Numbers Game More Than a Numbers Game A Brief Histor y of Accounting Thomas A. King John Wiley & Sons, Inc. Copyright © 2006 by Thomas A. King. All rights reserved. Published by John Wiley & Sons, Inc., Hoboken, New Jersey. Published simultaneously in Canada. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per-copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750-8400, fax (978) 646-8600, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748-6011, fax (201) 748-6008, or online at http://www.wiley.com/go/permissions. Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability...
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...The Sarbanes-Oxley Act (SOX) became law in 2002 after the discovery of significant fraudulent activity on the part of officers of several corporations (Enron, WorldCom, Adelphia, etc.). The goal of the law was to stem the tide of continuing fraudulent behavior, tighten governance and make it more costly for individuals if they were involved in frauds. Unfortunately, the goals were not achieved, and the spate of significant frauds continued with frauds involving major banks and corporations (HealthSouth, Lehman Brothers, AIG, Madoff Securities, etc.). These frauds took place which has led to the additional passage of the Dodd- Frank Act in 2010. The passage of SOX and the Dobbs-Frank Act points to the inability of laws and regulations, by themselves, to prevent fraudulent behavior. Do you think “maintaining a culture that emphasizes ethics and compliance” is enough to prevent fraud? Do we need to focus on the dangers of unbridled greed and on inventing fancy investment instruments that few people understand but many people trade since no one wants to be left behind in the often believed unlimited profit potential of the markets? Title II of SOX consists of nine sections that establish standards for external auditor independence. The goal of Title II of SOX is to restrict auditing companies from providing non-audit services (e.g., consulting services) for the same clients in which they audit. In the article “The Case of Phar-Mor Inc.” the author Williams, S. Lansing...
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...A SHORT HISTORY OF ACCOUNTING AND BUSINESS By Gary Giroux September 1999 Preface Overview: Accounting toward the 21st century: Where are we now? How did we get here? 1. From the Ancient World to Pacioli The First Cities Trade Tokens: The First Accounting The Sumerians Complex Tokens and Clay Tablets Cuneiform Writing and Beyond Money, Banking and Credit The Dark Ages and the Rise of the Italian Merchants Luca Pacioli: The Father of Accounting 2. Britain and the Industrial Revolution Prior to 1750 Ironbridge Textiles The Steam Engine Wedgwood and the Importance of Cost Accounting Early Cost Accounting Transportation Development of the Accounting Profession 3. American Big Business and Cost Accounting Early Developments in Manufacturing and Accounting Rockefeller Morgan and Carnegie Cost Accounting in the Era of Big Business Alternative Systems in Asia and Europe Relevance Lost: The Critique of Johnson and Kaplan The American Response 4. Financial Accounting and the Structure of Accounting Regulation The Great Crash and Government Response The New Role of the Accounting Profession The Financial Accounting Standards Board Earnings Management and Economic Consequences Accounting Principles and the Conceptual Framework 5. Auditing Auditing in the U. S. The Big...
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...The creation of the… Committee on Accounting Procedures a) Role: formative era b) history: c) structure: In response to the SEC’s Accounting Series Release No. 4, the American Institute of Accountants (AIA) reorganized its Committee on Accounting Procedure (CAP) in 1939 and increased it from 8 to 22 members, all accounting practitioners except for three academicians. To emphasize its importance and the AIA’s intent to demonstrate leadership, Clem W. Collins, AIA president, was designated CAP chairman. George O. May, who had led the prior committee as well as the AIA Special Committee on Cooperation with Stock Exchanges, served as CAP vice-chairman. d) strengths; First, accounting practices, especially in terms of uniformity, improved significantly. Second, the private sector was firmly established as the source for accounting policy making in the United States. Accounting Research Bulletins (ARB) The CAP would issue 51 ARBs during its existence, several of which survive in today’s FASB’s Codification, and four Accounting Terminology Bulletins. e) weaknesses: The CAP decided early on that formulating a statement of broad principles would take too long and instead approached issues on a case-by-case basis. Without a framework and often without adequate research, the CAP relied on the members’ collective experience for agreement on member-suggested solutions. In 1949, the CAP reconsidered developing a framework but instead codified and updated...
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...Double Entry “[Accounting] now has the potential to make or break the planet” (White p. 8). That is the tone the Jane Gleeson-White used to set the mood of the book. You had warned me that she would be “preachy” in the end of the book, but I didn’t know how preachy. I will cover that in the end of this paper. White explores the origins of double entry in a rather interesting way. She makes you feel that accounting is the most important subject that man has ever created and we owe everything we enjoy to all accountants. She does an excellent job explaining the history and pioneering work of Luca Pacioli. In total the book was very interesting and left me feeling like I had chosen a major that will change the world. White starts the book off with explaining the history of accounting and how we owe any human achievement to accounting. “It now appears that writing, one of the greatest human accomplishments, was invented by accountants” (White p. 11). The early Athenian civilization is known for the world’s first democracy. White states that accounting “and freedom of financial information were considered essential for running the world’s first democracy” (White p. 15). Within the first 20 pages she has basically made the argument that accounting is the reason we have the constitution and democracy. I do agree that there is some basis for her argument, but she does give an extensive history and progression of the accounting system. She shows how Italy became the birthplace for...
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...Reporting Timeline The creation of: 1. Committee on Accounting Procedures Role - With the recent increase in members, the SEC delegated the responsibility of issuing pronouncements on accounting principles to the Committee. The SEC worked with the Committee on Accounting Procedures to develop standards for accounting and financial reporting and issued 51 Accounting Research Bulletins (ARBs) over its lifetime. In 1949, they updated 42 of their original ARBs and codified them. a. History - In 1933, the Special Committee on Development of Accounting Principles was formed by the AICPA. Quite simply, this committee did not get much done and was replaced by the Committee on Account Procedures in 1936. For the first two years, this committee also made very little progress. In 1938, the Securities and Exchange Commission issued Accounting Series Release No. 4 which asserted that any financial statements prepared in accordance with principles that had no substantial authoritative support would be considered inaccurate. This prompted the CAP to expand from 7 members to 21 members and increased its activity. b. Structure – The Committee on Accounting Procedures was committee formed by the American Institute of Accountants after the SEC delegated to it the responsibility of issuing pronouncements on accounting principles without government council. Initially, the CAP wanted to create guidance for solving accounting problems, but did not believe they had enough time. Instead...
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