History of Accounting

Accounting may be thought of the practice of keeping track of something or, more formally, of keeping and counting records. It is primarily used for keeping track of wealth.

Accounting, in ancient Mesopotamia and Egypt starting around 3500 BC,

and consisted mainly of keeping records of transactions. In Egypt they were written on Papyrus (a form of paper made from reeds) and in Mesopatamia they were inscribed on clay tablets that were either dried in the sun or baked. Other literate contemporary civilizations, such as China and India, also had means of accounting. Later on,

Persia, Greece and Rome, who eventually had empires, greatly extended the use of accounting. This was necessary to keep track of the varied kinds of wealth that they derived from their huge empires.

A famous example of accounting in the middle ages is the Doomsday Book which was written in 1083 AD by order of William the Conqueror. When William the conquered England, he decided that he needed an accurate record for tax purposes of all the property in England. A continuous written account of taxes paid to the King of England was kept from 1030 AD to 1830 AD. It was called the Pipe Roll or the Great Roll of the Exchequer. The amount each tax collector gave was inscribed as lines of various thickness on a Talley stick or “Pipe”.

Double entry book keeping is considered to have been originated by an Italian monk named Father Luca Bartolomes Pacioli in 1494. This was the period of the Rennassiance, when the Italian states such as Venice and Genoa were engaged in extensive and varied trade. The instructions were published in a book named “Summa de Arithmetica, Geometria, Proportioni et Proportionalita”.

The birthplace of modern accounting methods is considered to be Scotland. The Institute of Accountants in Glasgow was officially recognized by Queen Victoria in 1854.

It was there that the title “Chartered Accountant” or CA originated. ┬áThe need for accountants arose from the extensive trade that England was involved with due to its world wide empire and the industrial revolution. It was a natural progression that accountants from the British Isles should come to America. Thus the British title CA, is the antecedent to the American title CPA or Certified Public Accountant.