Free Essay

History Development of Accounting

In: Business and Management

Submitted By riri1990
Words 382
Pages 2
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 af assets into abstract values and the quantitative expression of the result of business activities systematic accouting in the form of double-entry bookkeeping.
Accounting Theory
A set of broad principles that provides a general frame of reference by which accounting practices can be evaluated and guides the development of new practices and procedures. (E.S.Hendriksen)

Development of Accounting Principles in the USA * 1900-1933: Managment Contribution Phase
Management had complete control over the selection of financial information disclose in annual report. * 1933-1946: Institutional contribution phase
Increasing influence by several institutions and committees in the development of accounting principles. * 1959-1973: The professional contribution phase
The professional bodies played a significant role in developing principles * Political phase
Continued to the present, the FASB and various pressure group are moving toward politicization of accounting.

What is accouting?
A study of the evolution in accounting thought, practices and institutions in response to change in the environment and societal needs. It also considers the effect that this evolution has worked on the environment.(Committee on Accounting History, 1920)

CHAPTER 1: HISTORY DEVELOPMENT OF ACCOUNTING…...

Similar Documents

Premium Essay

History of Training and Its Development

...HISTORY OF TRAINING AND ITS DEVELOPMENT It has been a way of life that, the trades of adults have been taught to children to prepare them to face the real world. During the course of time people have changed, become more intricate and along with them, the skills applied and the tools used to do the work have also transformed. In a situation to manage these changes in the production, and substance of operation, job training also evolved In olden times, the kind of work that people did was mainly unskilled or did not require expert knowledge. Older and experienced members of the group would usually pass their knowledge on to the young ones through direct instructions. This would usually take place while the job is going on. This was known as on the job training, it’s economical because there is no need for special tool other than what is normally used for the job. Most learning was done through observation. With the beginning of the Industrial Age, the training of the unskilful underwent a drastic change in which professional education and training developed to replace the out-dated system. The early 20th century witnessed the growth of training and development as a vocation, resulting in the establishment of training centres. Important moments in the 1900’s: • 1906: The National Society of Industrial Education is formed • 1911: Frederick Taylor publishes “The Principles of Scientific Management” • 1913: The first cars roll off the Ford Motor Company assembly......

Words: 1238 - Pages: 5

Premium Essay

History of Accounting

...“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......

Words: 538 - Pages: 3

Premium Essay

Brief History of Accounting

...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......

Words: 65244 - Pages: 261

Free Essay

History of Accounting

...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......

Words: 3372 - Pages: 14

Free Essay

Accounting History

...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......

Words: 551 - Pages: 3

Premium Essay

History of Accounting

...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......

Words: 746 - Pages: 3

Premium Essay

Development of Accounting Practices in Austrailia

...The history and Accounting practices in Australia Development of accounting practices in Australia: The Accounting Practices were firstly recommended and issued by the Institute of Chartered Accountants in Australia (ICAA) in 1946 and these accounting practices were called as “Recommendations of Accounting Principles”. These accounting principles were just barely “copied” from those issued earlier by the Institute of Chartered Accountants of England and Wale (ICAEW). However, these accounting practices somehow led to high level of nonconformity because lack of united professional body to work on the issues incurred. Other than ICAA that is incorporated by Royal Charter, another professional accounting body named CPA Australia (was initially known as the Australian Society of Accountants, ASA then changed its name to the Australian Society of Certified Practicing Accountants, ASCPA and changed it name to CPA Australia in 2000) also issued accounting practices that deal with subjects related directly in preparation of financial statements. In 1966, ICAA and CPA were then jointed and work together to form Australian Accounting Research Foundation (AARF) to research and issue proposed accounting standards through its Accounting Standards Board (AcSB) and the Public Sector Accounting Standards Board (PSASB) to the private sector and public sector organizations. The process of how AARF issued accounting standards was pretty much the same as how The International Public Sector...

Words: 1871 - Pages: 8

Free Essay

History of Accounting

...DEVELOPMENT OF CONCEPTS OF CAPITAL AND INCOME IN FINANCIAL REPORTING IN THE NINETEENTH CENTURY Calculation, Context and Consequence THOMAS REGINALD (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......

Words: 130630 - Pages: 523

Free Essay

History & Development of Policing

... Write 2-3 pages outline the history and development of policing in Jamaica. In partial fulfillments of the requirements of the course CJUS115 Criminal Justice Instructor: Dr. Fay Williams By Sydoney Blackwood I.D # 15130115 Section A Date: 1st October, 2014 In 1671 a letter was written, sent and adhered to. This letter established change for Jamaica; a brighter and emancipated future. “We serve, we protect, we reassure with courtesy, integrity and proper respect for the rights of all,” a mission to uphold in this ‘change’. After Jamaica was captured by the English Colonists in 1655, law enforcement was conveyed. Seemingly during this period, the community recognized the need for an agency to maintain law and order. In 1716, night watchmen were appointed to serve various cities in Jamaica, after which in 1832 the first attempt was made in establishing a permanent police force. The Morant Bay Rebellion called for the strengthening of this force after their services were rendered. An improved force was established, the Jamaica Constabulary Force. This force had major responsibilities and so was a choice for individuals, as it was voluntarily that one may join the force. These responsibilities were and currently are based on the Jamaica panel code. Over a period of time in the Jamaican Constabulary Force, advancements such as ranks, uniforms and proper training were put in place. The first development of the Jamaica Constabulary......

Words: 1000 - Pages: 4

Premium Essay

History & Development

...Islamic Banking and Finance: History Development Slide #1 Some Issues History Of IBF Development of IBF -Overview- 2. Islamic Banking and Finance: History and Development History and Development of IBF in Bahrain Full Fledged IB vs. IB windows • Word ‘bank’ comes from the word ‘banco’ - A table or a bench on which Italian money-changers used to display their monies and records and conduct their transactions History of Islamic Banking and Finance • Arabic financial and economic system preIslam – Trading based arrangements were common • Bay’ al-musawamah (bargaining) • Bay’ al-muzayadah (auctioning) • Bay’ al-amanah (trust sale) – Al-murabahah (resale with profit) – Al-tawliyyah (resale at cost) – Al-wadiah (resale at loss or below cost) History of IBAF- (2) – Barter trade was common – Al-sarf (money exchange) • Lack of standardization – for e.g., 10 grams of gold in coin form = 15 grams of gold in bracelet form – Institutionalization of riba – Widespread gharar and maysir – Monopoly, fraud and economic injustice was common History of IBAF- (3) • With the advent of Islam, – Eradication of riba institutions and practices – Eradication of gharar transactions – Institutionalization of fair and equitable markets • No monopoly, fraud • Standardization of money and commodity exchanges – Hadith on the six commodities – Islamization of many business organizations and institutions • Mudarabah, musyarakah, salam, muzara’ah (sharecropping or......

Words: 4259 - Pages: 18

Premium Essay

Accounting for Software Development Costs

...Accounting for Software Development Costs Applying SOP 98–1 Paul Flanagan Principal Consultant 1552 Lakeport Court, Virginia Beach, VA 23464 Tel: 757-373-1454 / Fax: 810-885-5312 / pflanagan@christophertechnology.com www.christophertechnology.com Disclaimer The author of this report is neither a Certified Public Accountant nor an Attorney. This report should not be construed as providing either financial accounting advice or legal advice. This report represents the views of a senior information technology executive who has significant experience in the application of these accounting guidelines in the real world of business operations. Because applying these concepts depends upon the exact circumstances of your enterprise, this report shows only guidelines which have operated successfully elsewhere, but may not be precisely applicable to your situation. For all accounting or legal advice, please consult a licensed practitioner familiar with your unique situation. Accounting for Software Development Costs Table of Contents Table of Contents Introduction................................................................................................................................... 1 Payoff.......................................................................................................................................... 1 General Applicability..............................................................................................................

Words: 14451 - Pages: 58

Premium Essay

Accounting History

...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......

Words: 9978 - Pages: 40

Free Essay

History of Accounting

...of Job Vacancy in your Companies I would like to propose my candidacy for your position of audit executive which was advertised in 2015. I am enthusiastically applying for this post because I firmly believe that a combination of my natural ability, technical expertise and some work experience make me an ideal candidate for this role. I am currently pursuing Degree in Accountancy (Honors) at Uitm Shah Alam. I will be graduate in the early of September as this will be my last semester. During my times in the University, I gain a lot of experiences and knowledges related to the field I studied. During my internship period, I was given a task to deal with a lot of client to complete my job. Besides that, I have a very strong basic on accounting knowledge as it was my main stream on this 4 years of study. Besides academic, I am also actives in co-curricular activity. I have being joining many sports tournament which helps me a lot in improving my confidence and lead to a healthy life. Other than sports, I am also like to travel to many interesting places. This show how I am willing to travel if I was given a job that need me to travel to other places. Details of my achievements and accomplishments can be found in my attached resume. I am available for interview at any time. Thank you for the time you have taken to consider my application, and I eagerly look forward to hearing from you. Yours sincerely Muhammad Shahzwan Bin Shahrul...

Words: 293 - Pages: 2

Premium Essay

Development of Accounting

............................. 2 1.1 Luca Pacioli: Father Of Modern Accounting ...................................................................................... 2 1.2 19th Century – The Beginnings of Modern Accounting in Europe and America ............................... 3 1.3 20th Century – The Development of Modern Accounting Standards................................................. 4 1.4 21st Century – Accounting Regulation in Modern Commerce ........................................................... 4 2. DEVELOPMENT OF ACCOUNTING .................................................................................. 4 3. EVOLUTION OF ACCOUNTING ......................................................................................... 5 4. THE CONSEQUENCE OF DOUBLE ENTRY ..................................................................... 6 5. RECENT GROWTHS AND DEVELOPMENTS IN ACCOUNTING ............................... 7 6. LOOKING TO THE FUTURE ............................................................................................... 8 REFERENCES .............................................................................................................................. 9 1. INTRODUCTION The main objective of this study is to critically review the Origin, Growth and Development of accounting theories and their impacts on financial reporting. Other objectives are to explore accounting theory in resolving areas of diversities among users of financial...

Words: 4587 - Pages: 19

Free Essay

Accounting History

...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......

Words: 274 - Pages: 2