Introduction to Public Accounting

1Origin of Accounting in Ancient Age

Fabián Alonso Osorio Morales

Code 2061107

Valley University

Teacher: Gonzalo García García

Zarzal, Cauca Valley

August 2020
ii

Table of Contents

Introduction……………………..………………………….…………………..…………..1

General objective AND specific

objectives…………………………………………………………..2

Applied Work:

Origin of accounting in ancient times………..…….………………………………..3

Historical evolution……….……………………………….………………………………..5

Accounting in Ancient Age…………………………………………………………6

Important Dates About the Origin of Accounting......................................... ....12

Who is the Father of Accounting……….………………………………...…………14

Contributions from Lucas

Pacioli…………………………………………………………………….15

Conclusions……………………..……………….…………………………………...….19

Bibliography…………………….………………………………………………….…20
Introduction: 1

Since the beginning of time, humanity has had and has to maintain order in every aspect and

even more so in economic matters, using very basic means at first, and then using advanced

means and practices to facilitate the exchange and/or management of its operations.

Accounting was born with the need of every natural or legal person whose activity is:

commerce, industry, provision of services, finance, etc. To be able to generate information about

the resources it has; and to be able to understand whether or not I reached the set objectives.

Accounting dates back to very ancient times, when man was forced to keep records and

controls of his properties because his memory was not enough to store the required information.

It has been demonstrated, through various historians, that in times such as the Egyptian or Roman

times, accounting techniques derived from commercial exchange were used.

It is defined as a set of systems adapted to classify the economic events that occur in a

business. In such a way that it becomes the central axis to carry out the various procedures that

will lead to obtaining the maximum economic performance involved in establishing a specific

company.

General objective
2

 The objective of this work is to show what Accounting was like in ancient times and how

it has changed over the years and generations.

 Explain the origin and foundations of accounting throughout history.

Specific objectives

 Know how accounting has been developing around the world, starting with the different

cultures that we know today and know what instruments they used to carry out accounting

records .

 Explain the historical evolution of accounting in prehistory as well as learn how the

principle of duality began at that time.

 Use of well-defined empirically significant terms.

Applied Work:
Accounting in ancient times 3

The first managers of accounting activity are located around the year 8000 BC. in Uruk, a city

in Ancient Mesopotamia, the current territory of Iraq. Uruk was a center of the Sumerian

civilization. These first accounting records consisted of clay tokens, kept in clay receptacles,

which were used in the calculation of assets. For example, a clay token could represent an ox. If

that ox were transferred to another pasture or given to another owner, its token would also be

transferred to another clay receptacle, thus recording the event that occurred and helping the

owner control the assets. Thus, a single accounting event (for example, a loan of an ox) would

involve two clay receptacles: one, representing the owner's stock of oxen, would represent a

token; another, representing the right of the owner of the ox over the person who was taking the

ox by presenting, recipient of the token. This would be a double transaction record or, in other

words, a doubled item release. After the creation of clay tokens for accounting control, the
creation of tables with cuneiform writing took place, for accounting for bread, beer, materials 4

and slave labor, in Uruk and in Ur and ambient in Ancient Sumeria. In this way, the invention of

man's writing is closely linked to that of accounting. The Ancient Egyptian environment

contributed to important advances in the book of accounting science, mainly due to the

government's need to organize the collection of taxes. The ancient Egyptians innovated to make

accounting records using monetary values, in the case of gold and silver. In ancient Greece, the

bureaucracy of the city of Mycenae maintained archives that recorded, on clay plaques,

inventories of slaves, horses, war chariots and parts of those chariots, as well as the creation of

taxes. With the development of Greek democracy, elected rulers began to have to account for

how they used public resources, through accounting statements inscribed in stone. The ancient

Romans were already concerned with a meticulous record of their personal heritage, using wax

tablets engraved with sharp styluses for drafts that were then transcribed for papyrus or

parchment. At the level of government administration, the Romans had the figure of the General

Accountant of the State, who controlled the imperial finances and was one of the most important

official figures in the state machine.

In ancient times, commercial transactions were carried out through the exchange of goods for

those that were lacking, what we know as barter.

Historical evolution.

To go back to the origins of Accounting, it is necessary to remember that the most ancient

civilizations knew rudimentary arithmetic operations, many of these operations creating auxiliary

elements for counting, adding, subtracting, etc. Taking into account time units such as the year,
month and day. An example of the development of these activities is the creation of currency 5

as the only instrument of exchange.

In such a way that it can be asserted that the origins of Accounting are as old as man,

therefore, the History of Accounting deserves the detailed study of each stage.

Accounting in Pre History

Cro-Magnon man appears 45,000 years ago, as nomadic societies . Prehistoric man retired to

paint in the solitude of caves, such as Altamira, to record the number of his animals taken in

hunting. Since in those early times in the history of humanity, man did not have the resource that

constitutes writing and it was necessary to keep some type of notes or record of commercial

transactions, our merchants and business people of yesterday They were forced to carve samples

on rocks or trees , or signs on the mud walls of their houses. According to the reports available,

these writings were in pictorial form, captured on clay tablets and their manufacture is attributed

to the Sumerians, who were predecessors of the Babylonians. According to archaeological data,

the techniques used by the Sumarios to carry out these records consisted of taking wet clay

tablets and using the sharp end of a juneo or reed to make the corresponding marks.

Accounting in ancient times

Recent research such as that of Denise Schmandt-Besserat and, above all, that of Hans Nissen,

Peter Damerow and Robert Englund (1990), archaeologists and historians of ancient

Mesopotamia, allow us to affirm that the first known written documents, consisting of Thousands

of clay tablets with inscriptions in proto-cuneiform characters, made more than 5,000 years ago,

contain only numbers and accounts, without texts or words.

This fact makes the aforementioned researchers conclude that writing must have emerged, 6

around the year 3,300 BC, to satisfy the need that the ancient inhabitants of Mesopotamia felt to

record and leave records of their accounts. It was not, therefore, the desire to bequeath to later

times the memory of war exploits, stories of heroes or gods, or to capture legal norms that

motivated the birth of writing, as was believed until now, but simply the need to collect and

preserve the accounts originated as a consequence of productive and administrative processes.

This is where the formulation of an initial accounting paradigm begins, in which practice is the

basis. After establishing the "account" the need to exercise accounting control is created, since it

was necessary to verify the veracity of the information, from this moment we can speak of

accounting science as an object of study.

The first civilizations that arose on earth had to find a way to record certain facts with arithmetic

projection, which occurred too frequently and were too complex to be preserved by memory .

Kings and priests needed to calculate the distribution of taxes and record their collection by one

means or another. Lastly, merchants have always been the sector of society most committed to

any new data recording procedure . And there have been merchants and money changers from the

beginning in all civilizations.

Schools of practice
This covers the period from 470 to 1458, from this moment on we move from trade to 7

profession, we talk about the use of linked books and rules.

This creates a new meaning, as accounting practices are improved, historical development leads

to the introduction of double entry.

Several schools were born that investigate and contribute to accounting development, which

sought to improve practice and provide useful information, but they left aside the formulation of

an accounting theory that would give foundation to their advances.

The most outstanding accounting

Mesopotamia

The country located between the Tigris and the Euphrates was already in the fourth millennium

BC. From J.C. seat of a prosperous civilization. The merchants of the great Mesopotamian cities

constituted an influential and enlightened caste from very early times.[5]

The famous code of Hammurabi, promulgated approximately 1700 BC. From JC, it contained

criminal laws , civil and COMMERCE regulations. It regulated contracts such as loans, sales ,

leases , commissions, deposits and other figures of civil and commercial law , and among its

provisions there were some directly related to the way in which merchants kept their records.
8

Thousands of ceramic tablets have been preserved that allow us to form an image of the way the

Sumerians kept accounts. Thanks to these witnesses, immune to the passage of time, we know

that in very ancient times there were commercial companies , in which capital contributions and

the distribution of profits were carefully stipulated in writing.

The very organization of the State , as well as the proper functioning of the temples, required the

registration of their economic activities in detailed accounts. The temples became true banking

institutions , which made loans.

The rise of Babylon at the beginning of the second millennium BC. From JC, that is, from the

time of the Code of Hammurabi, it brought with it progress in accounting records. A generalized

way of making inscriptions then appears, establishing an order in their elements; account title,

name of interested party, amounts, general total.

The Mesopotamian peoples already used the abacus to facilitate the performance of arithmetic

operations, which were extremely laborious at all times, until the relatively recent universal

introduction of the current Arabic numerals.

The custom of inserting the ceramic plate into a rod, following a chronological order, created true

accounting books.
Egypt 9

If accounting was important among the Mesopotamian peoples, its use was even more necessary

in a society as rigidly centralized as that of Pharaonic Egypt . The material instrument usually

used by the Egyptians to write was papyrus. The accounting type annotations, due to their

repetitive nature , came to form a type of hieratic writing that has been very difficult for scholars

to decipher. In any case, and despite the decisive role that accounting played in ancient Egypt, it

cannot be said that the pharaonic civilization has contributed to the history of accounting with

innovations or procedures that had not already been used by the powerful Chaldean merchants.

The material instrument usually used by the Egyptians to write was papyrus. The accounting type

annotations, due to their repetitive nature, came to form a type of hieratic writing that has proven

very difficult for scholars to decipher.

The scribes specialized in keeping accounts of the temples, the State and the great lords, came to

constitute a numerous and socially well-regarded technical body.

In any case, and despite the decisive role that accounting played in ancient Egypt, it cannot be

said that the pharaonic civilization has contributed to the history of accounting with innovations

or procedures that had not already been used by the powerful cauldron merchants.
Greece 10

The Hellenic temples, as had happened many centuries before with those of Mesopotamia and

Egypt, were the first places in classical Greece in which it was necessary to develop an

accounting technique. Each important temple, in fact, had a treasury fed with the obols of the

faithful or the states, donations that had to be scrupulously recorded. The treasures of the temples

were not usually immobilized and were frequently used in loan operations to the state or to

individuals. It can thus be stated that the first Greek banks were some temples. Perhaps the place

where archaeologists have found the most abundant and detailed accounting documentation is the

sanctuary of Delphi, where hundreds of marble plaques have been recovered detailing the

offerings of the faithful, as well as accounts for the reconstruction of the temple in the 4th century

before by J.C.

Rome

In the 1st century BC, Roman culture looked down on a person who was incapable of accounting

control of their assets.

The great businessmen came to perfect their accounting books in such a way that some historians

have believed they see in them, only some incomplete fragments preserved, a first development

of the principle of double entry.

There is no evidence that proves its use prior to the Italian commercial expansion of the late

Middle Ages .

For Double Entry to exist, it is not enough to have the accounts arranged in two facing columns,

or other formal details; It is necessary that the principle that informs the Double Part be applied

inflexibly, without exceptions.

However, it is where specified and incontrovertible testimonies are found about the 11

accounting practice, from the first centuries of its foundation, every head of family recorded his

income and expenses daily in a book called "Adversary", which was a kind of draft, since who

transcribed them monthly, with great care, in another book, the "Codex o Tubulae"; in which, on

one side were the income (acceptum), and on the other the expenses (expensum).

Important Dates About the Origin of Accounting

1494. First edition of the first known book on Book Weaving, written by Fray Lucas Pacioli.

1519. Don Alfonso Avila, accountant of the Vera Cruz City Council, is elected, being the first

official Accountant that existed in Mexico.

1522. On October 15, Charles V issues an appointment in favor of Don Rodrigo de Albornoz

as Royal Accountant of New Spain, who is in charge of the custody and collection of the Crown's

treasury.

1581. First professional group of accountants, founded in Venice, Italy.

1844. Act of the English Parliament, establishing that, to grant the incorporation of a

campaign.

1845. The Commercial Court of Mexico City establishes the Mercantile School
1847. The Mercantile school closes its doors due to lack of funds, at the time of the 12

American invasion.

1854. The School of Commerce is founded in Mexico City, by decree of Santa Ana.

1856. A society of Accountants is organized in Scotland, England.

1868. On July 15, when Don Benito Juárez was president, the Higher School of Commerce

and Administration was inaugurated.

1869. The teaching of foreign languages is reestablished in the School of Commerce and

continued in I failed the Spanish one.

1870. Don Bernardo del Raso is appointed director of the School of Commerce.

1871. The careers of "Accountant Clerk" and "Registered Broker" are created in said school.

1880. Queen Victoria grants grant to found the Institute of Accountants of England and Wales.

1886. Chemistry, statistics, and history of commerce classes are founded at the School of

Commerce.
13

Who is the Father of Accounting

14

Luca Pacioli

Pacioli oscillates between two antithetical conceptions of mathematics: one of a pragmatic

nature and another of a speculative and even mystical nature; In relation to the second, he does

not hesitate to adhere to the mystical-magical suggestions of humanist Platonism originating in

the Academy of Marsilio Ficino.

Contributions from Lucas Pacioli

The double entry proposed by Lucas Pacioli is a great contribution to Accounting, as his 15

work says and specifies the double entry: “there is no debtor without a creditor, nor a creditor

without a debtor”, he achieved his purpose since he was especially fascinated by mathematics. In

commercial and accounting terms, he designed a system that provides the merchant

(businessman) with timely information regarding his assets and obligations.

Your cultural influences

His work must be understood in accordance with the context of the Italian Renaissance period.

He is not a mathematician in the modern epistemological sense (like his contemporary Girolamo

Cardano or, later, Johannes Kepler). Pacioli, recalling Pythagoras, declares that "mathematical

science must be understood as the sum of arithmetic, geometry, astrology (then still confused

with astronomy), music, perspective, architecture and cosmography" (the latter in Pacioli's time,

still undifferentiated from cosmology, topography and geography).

The work Summa de Arithmetica, Geometria, Proportioni e Proportionalita by Luca Paccioli

was very successful, from its description in his work it is clear that the Venetian merchants used

the first draft. They used it to make entries in the journal, first converting the operations recorded

in the draft to the monetary unit chosen by the merchant to keep his records.
In his work Lucas Pacioli advises us to use four books: Inventory and Balance Sheets, 16

Draft or Receipt, Journal and Ledger. Which are still used today. His greatest contribution was

double entry, where he defines the mathematical principle rules of said method.

1. There is no debtor without a creditor.

2. The amount owed to one or more accounts must be equal to what is paid.

3. Everyone who receives owes to the person who gives or delivers.

4. Every value that enters is a debtor and every value that leaves is a creditor

5. Every loss is a debt and every gain is a credit.

6. The balance represents the value of the account and is obtained from the difference between

the debit and the credit, and may result in a debit or credit balance.

In the year 6000 BC there were necessary elements to consider the existence of accounting

activities, on the one hand writing, on the other numbers and of course indispensable economic

elements, such as the concept of property and the general acceptance of a unit of measurement. of

value.

The most remote antecedent of this activity is a clay tablet that is currently preserved in the
Harvard Semitic Museum, considered the oldest accounting testimony, originating from 17

Mesopotamia, where years before a civilization had developed, bringing economic activity to

bear. great importance.

Between the years 5400 to 3200 BC, the first vestiges of banking organization originated, located

in the Red Temple of Babylon where deposits and offerings were received and presented with

interest.

By the year 5000 BC, in Greece, there were laws that imposed the obligation on merchants to

keep certain books, in order to record the operations carried out.

Around the year 3623 BC, in Egypt, the pharaohs had scribes who, by superior orders, recorded

the income and expenses of the sovereign duly ordered.

Around the year 2100 BC, Hammurabi, who reigned in Babylon, carried out the famous

codification that bears his name and in it the accounting practice is mentioned.

By the year 594 BC, Solomon's legislation legally established that the council appointed by lot

among its members, ten lawyers, to build the “Court of Accounts”, intended to entrust officials

with various administrative services that had to be held accountable. annually.

Between the years 356 to 323 BC, the peak period of Alexander the Great's empire, the goods

market grew to such an extent that it covered the Baltic Peninsula, Egypt and a large part of Asia

Minor (India), causing adequate control to be exercised. about operations through notes.

In Rome, people dedicated to accounting activity left written testimony in the “Tesserae

consulare”, oblong tablets of ivory or other animal bone with inscriptions that show the name of a

slave or freedman, his master or patron and the date, as well as the “Spectavit” annotation, that is.

"Reviewed by". As reliable testimony, from the year 85 BC, some tablets were found that one of
them verbatim said: "Reviewed by Coecero, slave of Fafinius, on October 5, in the 18

consulate of Lucius Cinna and Gnaeus Papyrus", with certainty it is He knows that during the

Republic, as well as the Empire, accounting was kept by commoners.

In summary, the Romans kept an accounting that consisted of two books, the “Adversaria” and

the “Codex”.

The Adversaria was made up of two obverse sheets uniting in the center, intended to make

records referring to the Ark (Box), divided into two parts, the left side called the Accept or

Acceptium intended to record the income and on the right side called the Expense. o Expensum

intended to record expenses.

The Codex was also made up of two obverse sheets joined in the center, intended to record the

name of the person, the cause of the operation and its amount. It was divided into two parts, the

left side called “Accepti” intended to record the entry or charge to the account and the right side

“Respondi” intended for the creditor.

19

Conclusion

The history of accounting is a fundamental part of economic history and, even more so, of history

in general.

His field of research is not limited, in any way, to the study of the evolution of accounting

techniques, but rather penetrates into the very core of the organization and management

approaches of institutions , the significance, use and scope of the instruments. commercial, the

functioning of markets, etc.

Therefore, a deep and complete understanding of economic and social phenomena is hardly

possible if they are not studied from a perspective that includes the historical-accounting

approach. Only the difficulty of the technical knowledge required for the practice of accounting

history has until now prevented it from becoming generalized and its usefulness and importance

from being recognized.

Since the first civilizations had the need to transmit economic information for later times, until

today when there are specialized schools that teach this science, it was possible to determine that

there were 4 marked stages in the history of accounting, such as:

The Ancient Age; where man, thanks to his ingenuity, initially provided primitive recording

methods; What is the clay tablet like? Since then the evolution of the accounting system has not

stopped developing.
Bibliography: 20

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www.academia.edu

www.schoolpedia.com

https://sites.google.com/site/evoluciondelacontabilidadtxnch/evolucion-historico-de-la-

contabilidad/edad-antigua

https://www.monografias.com/trabajos97/origen-y-evolucion-contabilidad-mundo/origen-y-

evolucion-contabilidad-mundo3.shtml#conclusioa