2V GRADE 11-VELA 1/17/2019

HISTORY OF ACCOUNTING
For some, the first name that might come to mind when referencing early
accounting history is Luca Pacioli. Pacioli described double-entry bookkeeping in his
“Summa de Arithmetica, Geometria, Proportioni et Proportionalita” back in 1494. While
that may sound like a long time ago, accounting may have roots that trace back even
earlier. Accounting has been around for centuries. It’s a critic al part of the business,
record-keeping, and life in general. The first record of accounting occurred thousands of
years ago in Mesopotamia and has evolved into the intricate element of business and
life that it is today. Below is an informative guide that explores a short history of how
accounting has evolved over thousands of years.

Earliest Records of Accounting

The earliest accounting records were found over 7,000 years ago among the ruins
of Ancient Mesopotamia. At the time, people relied on accounting to keep a record of
crop and herd growth. They used accounting techniques that are still used today to
determine if there was a surplus or shortage after crops were harvested each season.

Accounting History during the Roman Empire

Later, during the reign of the Roman Empire, accounting continued to evolve
much further. “The Deeds of the Divine Augustus” is an account of Emperor Augustus’
financial dealings. It listed such quantities as distributions to the people, grants of land,
building of temples, money to military veterans, religious offerings, and money spent on
theatrical shows and gladiator events. This discovery hints at the scope of accounting
information available to the emperor, which he then probably used for planning and
decision-making purposes. Roman historians also recorded public revenues, the amount
of money in the state treasury, taxes, slaves, freedmen, and more.

Luca Pacioli’s Contribution to the Accounting Profession

In 1494, Pacioli wrote Summa de Arithmetica, Geometria, Proportioni et
Proportionalita, which included a twenty-seven-page treatise on bookkeeping titled,
Particularis de Computis et Scripturis (Details of Calculation and Recording) on the
subjects of record keeping and double-entry accounting. Pacioli’s book became the
reference text and teaching tool on the subjects of bookkeeping and accounting for the
next several hundred years. This was the first time that symbols for plus and minus
appeared in a printed book. This book was the first known published work on the topic of
double-entry bookkeeping. Summa Arithmetica was also the first known book printed in
Italy to contain algebra. Accounting basics are also mentioned in the New Testament of
the Bible in the Book of Matthew as well as in other religious texts such as the Qur’an.

Accounting During the Middle Ages

During the Middle Ages, bartering was the primary form of money-changing, but
when Europe changed to a monetary economy is the 13th Century, merchants began
relying on bookkeeping to keep a record of multiple transactions. This is when double-
entry bookkeeping got its start, which is when a debit and credit value is entered for each
transaction by the accountant. Merchants at the time used accounting as an ad-hoc
ordering system. It provided them with constant information about their businesses that
they could use in decision-making to grow their business as they saw fit. This laid the
foundation of how we use and understand accounting today.

Accounting Methods Today

Nowadays, there are accounting standards, auditing regulations, and ethical
standards for accountants to follow. Accountants and their peers handle the monetary
ebb and flow of the economy. Obviously, they are not the only people responsible for
this, but they play a huge role. Each business, company, corporation, government, and
an individual must use at least basic accounting principles during their life, and often
during their daily activities. It’s an important element of business and over thousands of
years has evolved into what we know as in modern accounting today.

REFERENCE

Fremont College (n.d.). History of Accounting. Retrieved from

https://fremont.edu/history-of-accounting/.