Merchants’ accounts, performance assessment and decision making in mercantilist Britain

Edwards, John; Dean, Graeme; Clarke, Frank

doi:10.1016/j.aos.2008.09.001

Cited by 47 publications

(38 citation statements)

References 27 publications

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“…From the time of its invention, its biggest boon was that it enabled businessmen to quickly establish their financial position, both in terms of their net worth and in terms of profitability (Pacioli 1494;Edwards, Dean, and Clarke 2009). But, it was and is always open to misuse, such as when Xerox over a five-year period treated future income from equipment rentals as current income and so overstated earnings by $1.5 billion; or when WorldCom improperly capitalised $3.8 billion of operating expenses (Patsuris 2002); or when, as the Hyderabad (India) Public Prosecutor alleged, B.R.…”

Section: Double Entry Bookkeepingmentioning

confidence: 99%

Using accounting history and Luca Pacioli to put relevance back into the teaching of double entry

Sangster

2010

Accounting, Business & Financial History

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Double entry bookkeeping is generally considered to be a topic that students struggle to learn. In part, this is seen as being due to their lacking awareness of both business processes and of the business environment in which accounting operates, which makes double entry appear an abstract concept and one they find hard to justify the effort of learning. It is also seen by many faculties as failing to encourage critical thinking; and as a purely mechanical process that is unnecessary in a university degree in accounting - that it belongs in the professional office where it can be taught in context in the work environment. This paper argues that there is an alternative justifiable view that, far from being unnecessary and failing to encourage critical thinking, knowledge and understanding of double entry is a key element required of anyone who seeks to fully engage in critical thinking concerning the validity of accounting information. It argues that double entry should be retained in the undergraduate accounting curriculum - that its absence from the curriculum encourages blind acceptance of accounting information as 'truth' and makes it more difficult to encourage accounting students to think critically about accounting information at later stages of their studies. This paper suggests that by adopting an accounting history-based approach, students can be presented with a context that may overcome their traditional failure to grasp the topic well at an early stage in their accounting studies. To support this claim, the paper suggests themes that could be covered when introducing the topic, suggests sources of teaching material, and offers access to historical background material concerning the 'father of accounting', Luca Pacioli, in order to assist faculties that wish to try it for themselves in the classroom.Pacioli, double entry bookkeeping, accounting history,

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Section: Double Entry Bookkeepingmentioning

confidence: 99%

Using accounting history and Luca Pacioli to put relevance back into the teaching of double entry

Sangster

2010

Accounting, Business & Financial History

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“…These improvements resulted, for example, in the standardisation of the use of "inner columns" to record, and balance, goods quantities within the ledger, rather than imbedding these numbers in the text (as described by Pacioli 30 (1759) reproduced in Figure 1 above. Though not providing direct evidence of accounting in practice, the content of the texts does imply (as argued more generally by Edwards et al, 2009) that these methods were used in practice. The use of EPIR in both texts and practice is further supported by Lee 31 (1975) in his discussion of accounting practice in the preindustrial revolution period (until c.1760).…”

Section: A Review Of the Development And Adoption Of Different Goods mentioning

confidence: 99%

“…In this way the approach is akin to that of Edwards, Dean and Clarke (2009): the creation and support of arguments that are a feasible…”

Section: Introductionmentioning

confidence: 99%

The perseverance of Pacioli’s goods inventory accounting system

Stoner

2011

Accounting History

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This paper details sources of the “undoubtedly strange” (Yamey, 1994a, p.119) system of goods inventory records described in Pacioli’s 1494 bookkeeping treatise and traces the longevity and widespread use of this early perpetual inventory recording (EPIR) system in English language texts. By doing so and contrasting this system with the bookkeeping treatment of modern texts, it is shown that the EPIR system persisted as the dominant form of goods inventory accounting for between 400 and 500 years and that the reasons for its demise are worthy of further consideration and research.

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“…2004) claimed Marxist restatement of DEB's Sombartian significance (cf. Macve, 1999); or the arguments subsequently advanced by Edwards et al (2009) for DEB's significance based on the 'prospectuses' of authors of accounting treatises. See also Chapman et al, 2009.…”

mentioning

confidence: 99%

“…While Miller & Napier (1993) long ago deplored its excessive elevation to being the keystone of accounting, fascination with the phenomenon of DEB, and with Pacioli's first printed exposition of it in 1494, continually re-emerges (e.g. McCarthy et al, 2008;Sangster et al, 2008;Edwards et al, 2009;cf. Yamey, 2010b).…”

mentioning

confidence: 99%

Contesting the Indigenous Development of 'Chinese Double-Entry Bookkeeping' and its Significance in China's Economic Institutions and Business Organization Before c.1850

Hoskin

Macve

2012

SSRN Journal

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Abstract*The recent rapid growth of China's economy has reopened historical debate about the extent to which it prospered during the Míng and Qīng dynasties through developing a significant market orientation on the base of its underlying agricultural bureaucratic feudalism. As a contribution to this debate, we question here the extent to which there is justification for claims concerning the development of a concomitant and indigenous Chinese form of double-entry bookkeeping (CDEB)-seen as having developed among bankers, merchants and proto-industrialists-and for its significance within such a market economy. Given that discussion on post-medieval European accounting history indicates that there is not necessarily a direct and positive connection between the development of Italian double-entry bookkeeping (DEB) and associated practices of entity accounting, and the development from the sixteenth century of Western capitalism, we argue that caution should be exercised in drawing any analogous connection in the Chinese context. But equally we wish to raise a more foundational issue concerning the similarities and differences between the knowledge worlds within which DEB and CDEB emerged, as a means to better reading the specific historical practices and discourses of each. We therefore review the invention and dissemination of western DEB as a technology emerging within a textually and semiotically changing knowledge world in the Latin West from the twelfth century AD, and consider how the evidence for the development and use of CDEB may then be reviewed in the context of the Chinese knowledge world. As part of such a reading, we focus on tracing possible intercultural linkages between the Western and Chinese developments across the fifteenth to nineteenth centuries. In this way we seek to problematise conventional 1 Visiting Professor, Essex Business School, University of Essex, Wivenhoe Park, Colchester CO4 3SQ, UK hoskin357@gmail.com 2 Emeritus Professor, Department of Accounting, London School of Economics, London WC2A 2AE, UK R.Macve@lse.ac.uk 2 formulations of the respective significance of both DEB and CDEB, while acknowledging that, at the current moment of such transcultural historical study, the mechanisms of translation and diffusion of practices and discourses generally remain obscure and inconclusive until the era of the transformation of China's modern economy in recent decades. There remains a clear need for further research utilising primary archival sources to test the arguments developed in the existing research literatures, and here.

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Merchants’ accounts, performance assessment and decision making in mercantilist Britain

Cited by 47 publications

References 27 publications

Using accounting history and Luca Pacioli to put relevance back into the teaching of double entry

Using accounting history and Luca Pacioli to put relevance back into the teaching of double entry

The perseverance of Pacioli’s goods inventory accounting system

Contesting the Indigenous Development of 'Chinese Double-Entry Bookkeeping' and its Significance in China's Economic Institutions and Business Organization Before c.1850

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