TINOTENDA BARWE

UNIVERSITY OF JOHANNESBURG
It is the period between 1815 and 1870 where the industrial revolution spread from Britain to other
countries in Western Europe ( Allen, 2011: 40). Due to ascent of the rich, the need for accountants was
no longer negligible, people were now becoming rich and there was a need to account for transactions
which took place on a daily base due to existence of trade. The development of the accounting profession
can be said to took place in four stages which falls from 8000 BC to the 19th century.
The first period was the '' Early accounting and accountants ", which took place between 8000 BC and
AD 1000 (Lee, 1990:79). During this era, people used physical symbols to represent trading items. It is the
period where people used symbols to represent certain items, for instance clay tokens. However, the
development of writing systems rendered the abandonment of physical symbol representation to less
tiring way of representing data of using pictograms, ideograms and phono grams a no brainer.
Due to the development of symbols to represent transactions, there was a need for people to be able to
decode the abstractions hence the need to be literate was a prerequisite. The need to be literate excluded
many people as the because there was certain knowledge required to interpret, hence the accounting
system had reached a closure. The method of 'accounting' used was record keeping for control and
settlement purposes as transactions were also conducted on credit.
As the development of economic commercial activities continued during the Neolithic period, there was
a further complexity and elaboration in the world of accounting. The recording of transaction were done
by accountants for accountants, these comprised of owners and/or the managers who were assigned by
the owner to run the commercial activities. The recording of transaction was in order to memorize the
commercial activities for tax, settlement, status purposes and any commercial activities which rendered
the need for the recording of the transactions (Lee, 1990: 80).
The complication of transactions forced owners to assign managers of transactions. Delegation of tasks
led to the need of a third part verification, this was done through comparing what was recorded and was
believed ought to be there. The main aim of the 'audit' was to check accuracy and responsibility of
possessions. Whenever a discrepancy exist after the audit, the accountant was penalized. Furthermore,
during this era the idea of accounting was transported to various locations at different times.

The accounting profession continued to exist due to existence of the scribe. The scribe had to be formally
educated in the temple or other schools, his main function was to translate commercial economic
activities to abstract representation. The selection of the scribe was based on the basis of intelligence.
The scribe was an informal profession as there was restrictions on joining the profession and the office of
the scribe was highly valued (Lee, 1990:82).
The preceding period was the 'renaissance accounting and beyond' which occurred between 1000 CE and
1800 CE ( Lee, 1990:84). During this era, the world of accounting can be said to be unchanged and
unchanged. It changed in the sense that education improved and the widespread of information
continued to persist as people continued to travel from place to place. It remain unchanged since
accounting practices which took place in the previous era continued to be used, the use of abstract
representation continued since it required less literacy.
During this era, the main aims of accounting were recording of exchange price transactions and related
possessions. Auditing continued to take place at specific scenarios in order to verify actual representation
and anticipated expectations. Furthermore, during the early stages of this period, accounting was more
evidenced based of economic actions rather than for decision making, and the accountant was the object
of the accounting as he was the controller of record keeping.
More so, the was an introduction of double-entry bookkeeping. This system enabled firm to assess the
performance of the organization as it included capital and profit calculation. In 1494, the first book of
double-entry accounting was published, and was authored by Luca Pacioli (Stolowy and Lebas, 2006: 34).
Numerous tiny details of bookkeeping techniques advocated by Luca were followed in texts and
profession for at least the next following next centuries. Accounting practices in Public accounting is
credited to Luca.
The introduction of the double-entry bookkeeping provide for a closure in the world of accounting, it
created a rule dominated means of viewing and efficiency for economic and commercial activities,
however teacher and books countered the closure system by providing the potential size of an elite and
by introducing competition in the market for accounting services. The closure was assisted by complex,
prescriptive technology and double-entry required expertise required specific individuals to have certain
knowledge.
The following stage was the ''Industrialization and accounting'', which occurred between 1800s and 19th
century (Lee, 1990:88). This is an era were the was development of mechanization, urbanization, profit

etc. The purpose of accounting changed in this era, it changed from a memory aid to a management and
control tool, to be specific from recording costs to management of costs. This was stimulated by the
introduction of factory-based-systems of production. There was a need to produce data for pricing
decisions and competitive bidding.
The use of cost data for management caused a shift from attention of the past recording information to
the future budgets, predetermined costs rates and standards. At first accountants were not involved, but
gradually they become convinced of the usefulness of this and they became involved. The ideas of relevant
costs, capital budgeting and performance indicators developed by Economists, Engineers were absorbed
into accounting. It was through this process that led to the development of management accounting, and
the stability of within the accounting system developed.
The last period was the '' professionalization and financial reporting''. During this era, there was a
development of financial accounting from management account(Lee, 1990:91). during the previous
period the main focus was on the preparation of a balance sheet and the need for a profit and loss
statement developed. More so, industrialization led to formation of partnership businesses which
stimulated the separation of ownership and management and hence the need for expert management
for efficient running of the organization.
Poor and inconsistent allocation methods and rules were criticized and debated and eventually
standardized. Rules of accounting were institutionalized and legitimized by formal written standards. The
use of CA and CPA designations were used and qualifications was dependent on the combination of
training and examinations. Auditing moved away from bookkeeping audits to a wider and scientific
auditing. And the accounting profession and practice came into full practice.
As discussed above, the accounting profession took a very long period to develop and we give thanks to
the accounting father Luca Pacioli for his first bookkeeping text book, as it played a pivotal role in the
standardization of the accounting profession and the importance of accountants.
BIBLIOGRAPHY
Allen, R.C (2011). Global Economic History. A very short introduction. New York : Oxford University Press
Lee, T.A (1990). A systematic view of the history of the world of accounting. Accounting, Business and
Financial History, 1(1): 74-107.

Stolowly, L and Lebas, M.J (2006). Financial Accounting and Reporting. A global perspective. London : Pat
Bond