History of Accounting

This history beginning with a little instrument but most

important.

From 6000 B.C

EARLY HISTORY OF
ACCOUNTING

Accounting appears to have been practiced since the

beginning of recorded history . Business transaction and
land sales were recorded by about 3000 B.C.
There is evidence in many early civilisations:
Babylonian (2000-3000 B.C)
Egyptian (1000-3000 B.C)
Greek
(1-1000 B.C)
-Early Islam (652 A.C)
Roman, Italy (1945)

EARLY HISTORY OF
ACCOUNTING
The name that looms largest in
early accounting history is Luca
Pacioli, who in 1494 first
described the system of doubleentry bookkeeping used by
Venetian merchants in his
Summa de Arithmetica,
Geometria, Proportioni et
Proportionalita. Of course,
businesses and governments had
been recording business
information long before the
Venetians.

 But it was Pacioli who was the first to describe the

system of debits and credits in journals and ledgers that
is still the basis of today's accounting systems.

Assets = Liabilities + Capital

THE AGE OF STAGNATION

The period between (1494 and 1775) is
regarded as the age of stagnation of
accounting. The world changed very little
during this period of about 300 years.
We know that accounting is a function of
economic (and social) development .
There was practically no economic
development . Naturally , there was no
progress in accounting practices and
ideas.

GROWTH OF ACCOUNTING
KNOWLEDGE
Accounting knowledge ( principles ,
practices , systems) has grown much
over the period of about 200 years
from (1775-2000).
(1775-1850):
The proprietary owners were more
interested in knowing their capital
(Assets Liabilities). Assets were
valued at current value.

 (1850-1900):
The basic accounting principles and
assumptions (operating guidelines)
developed during this periods.
1- Growth of corporations between this period the
development of separate entity assumption . There was
greater emphasis on income rather than on balance
sheet .
2- This resulted in development of accounting concepts of
income and the periodicity assumption.
3- A company was regarded as going concern; and assets
were valued at original cost less depreciation.

4- The revenue principles , the cost principles and the

matching principles began to be applied in the
construction of income statement.
5- Inventory and fixed assets began to be valued at
historical cost due to stewardship reporting.

(1900-1950):
1-As for development of this period , stewardship reporting
did not remain all that significant around 1950 . Cost
accounting and management accounting development
during this period .
2- Tax accounting , advising and planning were developed.
3- Auditing techniques , standers and guidelines were
issued by the professional bodies.

 (1950-present)
1- Later half of the current century , saw accounting as a
Full-fledged information system.
2- Many new theoretical concepts were tested and put to
practice . A long descriptive approach ,the normative
approach to development of an accounting theory was
also regarded as useful .
3- Various accounting standards boards and committees
were set up to issue statements of concepts and
standards in many countries.

4- International accounting was developed to harmonize

accounting techniques and practices in member-countries.
5- Non-monitory information also began to be reported in
annual statement.
6- Now greater attention was laid to systems planning and
inter-disciplinary applications. The application of computers
has revolutionized accounting system and techniques
.information system, information technology (IT), Ecommerce, management sciences.
- Accounting is now becoming a multiple model (pattern)
science.

THANKS A LOT FOR YOUR

ATTENTION