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 is a critical 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
RECORD 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 is an important element of business and over thousands of years have evolved into what we know as in modern accounting today with the aid of accounting packages such as Quick Book, Sage Pastel Evolution, Tally , Reflex Accounting, ACE Pack , Caseware Audit Bundle among others.to keep financial records of a business entity.
The author of this book ANATOMY PRINCIPLES OF ACCOUNTING VOLUME 1,
also train individual or group of people or corporate members of an establishment on the use of the above mentioned accounting packages in line with IFRS to record financial transactions of a business be it small, medium or big business.
For the training of a choosing accounting package(s) of your choice, you can reach the author/ facilitator Patriot Odunaro Babatunde Jimoh through whatsapp number +2348038454008.
HISTORY OF ACCOUNTING IN NIGERIA
The idea of establishing a professional accounting body appeared after Nigeria got its independence. It was provided by few accountants who coordinated the foundation of “The Association of Accountants in Nigeria”. The major goals of this organization were creation of a central organization for accountants in Nigeria, maintenance of a strict standard of professional ethics and realization of training, examination and local qualification of students in accounting. In 1965 Chief Akintola Williams had a significant influence on establishing the first professional accounting organization in Nigeria - The Institute of Chartered Accountants (ICAN).
The organization was established by Act of Parliament No. 15 of 1965 to: determine the standards of knowledge and skills that are necessary for those who want to master a profession of accountant; and from time to time to increase these standards depending on circumstances; provide according to the provision of the Act the establishment and maintenance of the registers of fellows, associates who have the right to practice in this profession; and from time to time to publish the list of these persons; perform through the Council of the Institute the other functions entrusted to it by the Act.
The Institute of Chartered Accountants was the major accounting body in West Africa.
In 1982, ICAN made a very important step for the formation of the Association of Accounting Bodies in West Africa (ABWA). Except the professional practice, this organization’s members are included in 3 tiers of public and private service. ICAN accounting in Nigeria When ICAN was established, it had about 250 members.
However, later the number of certified chartered accountants grew to 38,000. This institute was the first and only organization in Nigeria that regulated the accounting profession until first of January, 1979.
The other body that had to perform the similar duties was founded later. It was called the Association of National Accountants of Nigeria (ANAN).
This was the only Nigerian chartered organization in accounting area for which the teaching and examining of its students were permitted by law.
In addition, ANAN was the only organization that had a power and right to advance accounting as a science. As it was said earlier, it was founded on first of January 1979, and registered on 28 of September, 1983 and on 25 of August, 1993 the organization was decisively chartered by Decree 76 of 1993. ANAN is a truly national body of accounting that have programs of training and education reflecting the national Nigerian environment. The Association of National Accountants of Nigeria was established to make it a Premium Brand of Choice in Professional Accounting Practice in Nigeria and to influence education and practice in accounting at a high level. The Association makes everything possible to advance accounting as a science in the country due to highly qualified professionals.
The other organization formed in 1982, was closely associated with ICAN. It was called Financial Reporting Council of Nigeria. Originally, its name was Nigerian Accounting Standards Board. The major functions of the organization were the developing, publishing and updating Statements of Accounting Standards for financial statements of various companies. The report of the International Monetary Fund in 2010 claimed that NASB did not have enough funding for its statutory role. The organization needed to hire new employees, retrain already existing employees and increase the salaries.
Thus, the new organization to set accounting and auditing standards was established in June, 2010. It’ considered as independent body from ANAN and ICAN.
The full history of accounting in Nigeria is saturated and rich. The education in this area implies the action of giving systematic studying to enlighten the professionals. It offers the directions that are necessary for the future accountants to get the profession in Nigeria. This is very important for updating and increasing of skills and knowledge. The major components to become a successful accountant in Nigeria are training, learning, consistency, acquisition of skills and just hard work. This education needs to develop from a continuing relationship between accounting profession on one side, and academic on the other side. It shouldn’t be considered as a goal itself, particularly in training professionals. It’s necessary to promote accountability in private and public sector of the economy in Nigeria.
Our country is well-developed, that is why, there is an urgent need to get highly developed accounting professionals for its subsequent growth.
For more lecture note, click this link:
https://britstutors.blogspot.com/2022/08/lecture-note-on-acc-111-principles-of.html
