Liyan A Rach Chi 2009

Accounting History
Accounting in ancient
Sri Lanka: some evidence
of the accounting
and auditing practices
of Buddhist monasteries
during 815–1017 AD
Gregory A. Liyanarachchi
University of Otago
Abstract
This article identifies evidence of the accounting and auditing practices
that prevailed in ancient Sri Lanka (from 815 to 1017 AD) and discusses
motives for using such practices by a religious institution. The archival
method is used to collect data. The main sources of data collected are
detailed translations of rock inscriptions, which have been carried out by
various personnel. Archival evidence shows that the Buddhist monas-
teries were required to keep accounting records and to annually read
these records aloud publicly. Considering the peculiar nature of the
Buddhist monastery, this study concludes that accounting was relied
upon to maintain the reputation of a monastery and that of its members,
and to maintain goodwill among Buddhist monks, rulers, and people.
The prevalence of accounting and auditing practices in ancient Sri Lanka
adds further support to the theory that the origin of record keeping and
accounting practices dates back to ancient times.
Keywords: Accounting; ancient Ceylon; Anurādhapura kingdom;

Buddhist Vihāra; epigraphic evidence; monastery; Sri Lanka
Copyright © 2009 SAGE Publications 101

(Los Angeles, London, New Delhi, Singapore and Washington DC) and AFAANZ
Vol 14(1&2): 101–120. DOI: 10.1177/1032373208098554
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Accounting History Vol 14, No 1–2 – 2009
Introduction
This article focuses on the practice of record keeping (accounting) and the public
reading of the records (auditing) of Buddhist monasteries in ancient Ceylon
(presently Sri Lanka).1 Specifically, it focuses on the accounting practices of
Buddhist monasteries during 815 to 1017 AD, the last stages of the Anurādhapura
kingdom. These two centuries are selected as the focal period for several reasons.
First, in terms of the agricultural, architectural, religious and social developments of
the history of Sri Lanka, the ninth and tenth centuries are recognized as the golden
era of ancient Sri Lanka. This period bears witness to sophisticated systems of gov-
ernance and organizations and a well-organized society, culminating with the influ-
ence of Indian society, Buddhism, and native Sri Lankan cultural traditions and
practices. Second, according to the chronicled history, although the Anurādhapura
kingdom had ended due to invasions by South Indian rulers by the early eleventh
century, the country remained free from European influence until the sixteenth
century.2 Therefore, this time period permits an examination of the accounting and
auditing practices of Sri Lanka that is free from any significant European influence.
Lastly, the Buddhist monastery (a Temple or Vihāra complex) was one of the most
prominent institutions during the ninth and tenth centuries (Dias, 2001). The pres-
ence of a well-organized religious organization – the Buddhist monastery; its
dependency on kings, officials, and lay people for resources; the royal patronage of
Buddhism; the practice of making grants to a monastery; its significant role in soci-
ety; and its need to be protected by the kings, are important in understanding the
role of accounting in organizations and society in ancient Sri Lanka. In addition,
due to the prominence of Buddhist monasteries in Sri Lanka, a large volume of epi-
graphic and literary evidence about their activities is available, thus permitting a
reliable examination of monasteries’ accounting practices.
Several contributions are intended from the article. First, by providing evi-
dence of accounting and auditing practices in ancient Sri Lanka, the article extends
the literature on accounting history. This is an important contribution given that
there is little documented evidence in the accounting history literature on the
accounting practices of ancient societies in the Indian sub-continent (for example
Choudhury, 1982; Mattessich, 1998; Sihag, 2004 discuss the history of accounting in
India), even though the chronicled histories of countries in the region (for exam-
ple Sri Lanka) date back several centuries and show ample evidence of the pres-
ence of civilized societies with sophisticated political, religious, and economic
institutions. Second, the article explores the important role of accounting in an
institution committed to the preservation and promotion of a religion, that is
Buddhism, and especially its contribution to maintain openness and accountability,
a quality that would be vital to preserve the good name of the Buddhist monastery
and its members. Finally, by tracing the requirements laid down in the slab, pillar,
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Liyanarachchi: Accounting in ancient Sri Lanka
and rock inscriptions for accounting of the resources, income, and expenses of
monasteries, the article supports the theory that ancient societies used accounting
(and accountability) to maintain social and economic order (for example Carmona
& Ezzamel, 2007).
The rest of the article is organized as follows. The research method is described
in the next section. A brief description of the arrival of Buddhism in Sri Lanka and
its influence on society and institutions is presented in section three. In section four,
the Buddhist monastery, its resources and organizational and administrative charac-
teristics, are discussed. Evidence pertaining to the accounting practices used in
monasteries during 815 to 1017 AD is presented and the motives for maintaining
these practices are discussed in section five. Finally, section six concludes the article.
Method
The archival method is used for collecting data. The main data sources are the
English translations of slab, pillar, and rock inscriptions.3 The inscriptions have been
searched, discovered, identified, recorded, and translated by various personnel at
the Department of Archaeological Survey of Sri Lanka. English translations of 189
inscriptions pertaining to the period 815 to 1017 AD were read to identify the
detailed requirements for keeping and reading accounts (see Table 1). In addition,
Table 1: Names of kings and inscriptions during

815–1017 AD
Name of king No. of inscriptions
Dappula II (815–831) 1
Sena I (831–853) 4
Sena II (853–887) 28
Udaya II (887–898) 18
Kassapa IV (909–914) 39
Kassapa V (914–923) 25
Dappula IV (924–935) 34
Udaya III (935–938) 3
Sena III (938–946) 6
Udaya IV (946–954) 18
Mahinda IV (956–972) 12
Sena V (972–981) 0
Mahinda V (982–1029) 1
Total ⫽ 189
Sources: Ranawella (2001, p.xvi; 2004, p.v), Perera (2003).
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various sources that provided material and discussions about the institutions of
ancient Sri Lanka were read to collect data about the account keeping and auditing
practices that prevailed during the selected time period. Several other historical
records that provided independent corroborating evidence about the accuracy of
details and translations of inscriptions were also searched.
The time period between 815 and 1017 AD falls neatly between the post-
Buddhist and pre-European influence. This period adequately captures the
Buddhist influence in particular and Indian influence in general over more than
1000 years of Sri Lankan society, in a time without any significant European influ-
ence. According to Perera (2005, p.xxix), this period could be identified as the “last
phase of the Anurādhapura kingdom”. The end of the tenth century marks the fall
of the Anurādhapura kingdom due to the invasion of the kingdom by Colas led by
Rāja Rāja I (Seniviratna, 1994; Perera, 2005).
Buddhist Sri Lanka

It is difficult to discuss the historical issues of Sri Lanka without acknowledging
the influence of Buddhist teaching because it has had such a far-reaching effect on
the people, institutions, government, and society of Sri Lanka. Therefore, a brief
description of the arrival of Buddhism in Sri Lanka and its influence in society is
presented next.
Arrival of Buddhism
The arrival of Buddhism in Sri Lanka dates back to the third century BC.
According to the chronicled history, the teachings of the Buddha were brought to
Sri Lanka from India by a group of Buddhist monks led by Thera Mahinda of India
during the reign of King Devānampiya Tissa (250–210 BC) (Seneviratna, 1994;
Dias, 2001; Geiger, 2003; Mendis, 2005). As stated in Seneviratna (1994):
… the elders of the Sańgha at the Third Great Council held at Pāliputra under
the distinguished patronage of King Aśoka … [decided] to send missionaries
to preach Buddhism in the outlying provinces of the Maurya Empire and even
to lands well beyond the boundaries. The mission to Sri Lanka was headed by
the Thera Mahinda, the son of Aśoka himself. On their arrival, King
Devānampiya Tissa welcomed the missionaries and accepted with honour the
gift of the Dhamma which they brought. (Seneviratna, 1994, p.55)
With the King’s willingness to accept the teachings, soon the Buddhist doctrines
and traditions found a new home in Sri Lanka. According to Dias (2001):
The conversion of the king to Buddhism marks the establishment of the reli-
gion in the island. It is highlighted in the chronicles … as the most important
event in history [of Sri Lanka]. (Dias, 2001, p.8)
104
Since then, the social traditions, architecture, monastic life, language, and people’s
thinking gained inspiration from the Buddha’s teachings. Monastic life became an
important feature of the main cities of Sri Lanka and these readily received praise
from the ruling monarchs. It is said that thousands of followers of the Buddha
found lodgings and basic facilities to lead a contemplative life in many of
the monastic centres established in various parts of the country (Rahula, 1956). In
the 1st century BC, one of the most significant historical events with respect to the
preservation of the teachings of the Buddha – the expression of the teachings in
Pali – took place in Sri Lanka. As stated in Rahula (1978):
The teachings of the Buddha were committed to writing for the first time at a
Council in the first century B.C. – held in Ceylon four centuries after his death.
Up to that time, the whole of the Tipitaka had been handed down from gen-
eration to generation in [an] unbroken oral tradition. (Rahula, 1978, p.91)
Although the significance of this event and its contribution to Buddhism is obvi-
ous, this event could also be taken as evidence of the nature of the civilized soci-
ety that prevailed in Sri Lanka at the time. For example, arguably for an endeavor
of this significance to be undertaken, the presence of a well-organized, well-
resourced, learned, and highly motivated body of Buddhist monks is necessary.
Similarly, such endeavors are unlikely to happen without the rulers and people of
the country approving of and supporting monks in their engagement in religious
pursuits.
In short, since the arrival of Buddhism, not only has Sri Lanka become one
of the main centres for learning and promoting the teachings of the Buddha, but
also the commitment of its people to Buddhist teachings has continued unshaken
to the present time. This is so despite Sri Lanka experiencing numerous challenges
against Buddhism and the Buddhist way of life. Some of these early challenges
came from India, mostly from the rulers of the southern part of India (for exam-
ple invasion by Colas in 993 AD). And, more significant threats to Buddhism came
later with the arrival of Europeans in Sri Lanka in 1505.
Buddhist Monasteries
The Buddhist monastery is the key organization of interest to this article. The
Buddhist monastery has direct links to the teaching and the order of monks the
Buddha set up to preserve and to continue teaching. In addition, as an organiza-
tion of a body incorporate, the order of monks or Sangha, is thought to represent
the first instance in the Indian history where the concept of an incorporate body
has been formally recognized (Jayatilleke, 2000).4 That is, while Sangha could
receive and own property such as land, buildings, and forest groves and parks, its
individual members could not.
105
The earliest form of this organization was the order of the monks itself with-
out any specific location or establishment, and this is referred to as the ‘[Sangha]
of the four quarters present and not present’ (Karunaratne, 1984, p.45). The first
form established in Sri Lanka appears to be the buildings Devānampiya Tissa
developed in Maha Megha Vana, the Royal Park, as residences for Thera Mahinda –
who brought the teachings of the Buddha to Sri Lanka – and the monks and nuns
who came with him (Dias, 2001). Later this complex received the name
Mahavihāra and is the oldest monastery of Sri Lanka. Many monks also resided in
caves in forests, provided to them by the kings, officials, or lay people.
The kings donated land to the monks or Sangha and built living quarters,
swimming pools, temples, and provided parks and forest-land for their use. Lay
people provided food to those who had abandoned their homes and families in
search of Nibbana (Sanskrit Nirvāna) and in return benefited from the teachings
offered by these monks and nuns. As time went on, the Buddhist monastery
became an organization to which a group of monks belonged to pursue the works
of a specific Buddhist sect, and monasteries representing different sects developed
throughout Sri Lanka.
As an organization, the monastery has gone through significant changes due
to the emergence of different Buddhist sects (naka or nikaya), endowments that
led to significant wealth accumulation, and changes in the lifestyle of monks. The
monastery became a complex organization in that a cluster of Vihāras or temples
emerged under the supervision of one main monastery or ätt-veher. For example,
Abhayagiri Vihāra founded during 89 to 77 BC by King Vattagamini Abhaya is one
such monastery. The two other monasteries that enjoyed the status of the main
monastery or ätt-veher, were Mahavihara (the first of the three earliest monas-
teries) and Jetevana Vihāra. All of these monasteries seemed to represent different
Buddhist sects or nikayas (Kulatunga & Amarasekera, 1993).
Each monastery became the owner of property or money. Although such
property was for the benefit of the members or monks who belonged to that
monastery, monks themselves could not own property. Notwithstanding this
vinaya (disciplinary or monastic) rule of Buddhism, there were occasions when an
individual monk received gifts. For example, Abhayagiri Vihāra was donated by
the King Vattagamini Abhaya to an elder monk “named Tissa as a gesture of grati-
tude” (Dias, 2001, p.80). In addition, changes in the monasteries also included
increases in their wealth as well as lifestyle changes from simple to lavish living
(Gunawardana, 1979; Dias, 2001). The monasteries’ vast amount of wealth
required management and the monks became involved in administrative roles.
As owners of property, the monks became interested in the revenue and
expenditure of their monastery (Rahula, 1956) and exerted a significant influence
over the lay people who worked or looked after their property. The kings were
interested in maintaining social order, protecting organizations and people, and
106
securing their power. The influence of the monks over people as overlords and as
spiritual leaders was, therefore, important for the kings. According to Rahula
(1956):
The influence of the Sangha over the masses was so great that rulers were
careful to win the hearts of the bhikkhus [Buddhist monks] for the sake of
peaceful and successful government. (Rahula, 1956, p.70)
The complex nature of the relationship among the kings, monks, and people,
according to Dias (2001) created several important outcomes:
Firstly, the monks became a crucial factor to check the royal power from
becoming tyrannous. Secondly, the interdependence of the monks and the king
was helpful to balance of power on both sides. Thirdly, it sometimes led to div-
isions among the monks. (Dias, 2001, p.77)
As a result of the involvement of monasteries in all spheres of society – spiritual,

social, political, and economic – their presence was strongly felt in society (Rahula,
1956; Gunawardana, 1979). Due to their experience in learning the doctrines of
Buddhism, the Buddhist monks became an important group among the literate in
society and they diverted their intellectual interests into other areas such as lan-
guage and grammar, thus extending their influence in education beyond the spir-
itual domain (Rahula, 1956). Accordingly, by the ninth and tenth centuries, monks’
activities ceased to be confined to the pursuits of religious ideals; their multifari-
ous role in society saw the development of a complex monastic life.
Immunities and regulations

The ancient inscriptions show that the monasteries received land from the kings,
officials, as well as from private individuals (Rahula, 1956; Gunawardana, 1979;
Dias, 2001; Perera, 2005). The earliest recorded grant to a monastery dates back to
the first century BC (Rahula, 1956). Donations were not confined to land and
money but, more importantly, included immunities as well (Dias, 2001; Perera,
2005). Another type of grant was concerned with regulations. Donations of land
also came with clear rules about the use and administration of property. For exam-
ple, in describing the way rules were laid down for the administration and man-
agement of donated property, Perera (2005) states:
In most of the regulation grants the only formula used was the king laid down
those rules … In private donations, however, the donor laid down the rules
along with the donation probably as a condition of the grant. (Perera, 2005,
p.204)
According to Perera (2003, p.141), the regulation grants included “particular rules
and disciplines intended for a particular situation and often intended to correct
some prevalent abuse”. He further states that while some regulation grants
addressed issues such as “the discipline of monks, the discipline and remuneration
107
of temple servants, management of temple land and distribution of its income”, a

few were not confined to religious issues but contained “rules for the administra-
tion of land, for economic control of the trade of a town, and the dispensation of
justice” (Perera, 2003, p.141).
Provision of immunities and land (and other resources such as water rights)
and detailing regulations were the main purpose of grants. Thus grants provide evi-
dence of a widespread practice of using some form of recording to communicate
rules laid down by the king or his officials. In some cases, the grant itself had been
made to lay people but with conditions that some benefits would be passed on by
them to a specific temple or Vihāra. Although land grants appear to be straight-
forward in that these include details of land donated by the king or others to a spe-
cific party, often a monastery, Perera (2003, p.82) states that many land grants may
not have been recorded, “at least on stone”. The reason for his statement is the
absence of any inscription in which the sole subject is land grants (Perera, 2003).
Details about land grants however are found in inscriptions that address grants of
immunities. Describing grants of immunities, Perera (2003) writes:
… the sole purpose behind them is to record the grant of various concessions
and privileges which have come to be called “immunities”. (Perera, 2003, p.96)
With the expansion of land donated to monasteries, there emerged a vast geo-
graphical area for which monasteries had been granted immunities. This strength-
ened the power of monasteries, but more importantly, it constrained the power of
the kings. For example, many areas of the kingdom were enjoying immunities that
prevented the arrests of criminals who found refuge in these areas (Rahula, 1956).
The details found in the ninth and tenth century inscriptions suggest that there
were numerous problems including misappropriation of wealth in the Buddhist
monasteries at the time and that the kings had intervened to solve these problems.
The significant increase in the number of inscriptions in the ninth and tenth cen-
turies, many of which contained detailed regulations (even including the detailed
requirements of the daily activities of monks), bears witness to a decline in disci-
pline among monks, misappropriation of monastic wealth, and the inability of the
monasteries themselves to address these issues (Dias, 2001). According to Dias
(2001), during the reign of powerful kings, measures were introduced to arrest
these problems. In this respect, it could be inferred that keeping of proper records
and the annual public reading of these were an important part of such measures.
Commenting on the requirement to keep and hear accounts, Perera (2005) writes:
All the longer regulation grants which lay down rules for vihāras contain a few
regulations on the keeping of accounts, and submitting of the same either to a
committee appointed for the purpose or to the general assembly of monks.
(Perera, 2005, p.274)
108
Specifically, it could be seen that record keeping had been relied on to arrest the mis-
appropriation of monastic property, and to improve openness and accountability.
Administration
During the early period of monastic administration, “The administration of a
monastery was entirely in the hands of the Sangha. Each monastery had a
Nevasika Mahathera (Resident Chief Monk) who was responsible for its discipline
and order” (Rahula, 1956, p.135). The administration however became a complex
affair as monasteries grew in size and wealth, thus expanding their activities into
managing land, reservoirs, irrigation water rights, and wealth. Disciplinary rules
however prohibited monks’ direct involvement in such activities thus making it
necessary to use laypeople to overcome these restrictions. The solution was to use
a layperson called kappiyakaraka, so that monks did not need to take part in the
daily administration of monastic affairs. Instead the layperson or kappiyakaraka
managed any property that belonged to the monastery (Gunawardana, 1979).
Specific mention has also been made about another type of lay workers employed
in monasteries, that is ārāmikas, “a comprehensive term which covered a wide var-
iety of workmen and employees attached to the monastery” (Gunawardana, 1979,
p.98). There are instances where the terms arāmikas and kappiyakāraka are used
as synonyms. Gunawardana is of the view that this is because in the early part of
simple monastic life a kappiyakāraka may have performed both domestic duties as
well as this official’s key duty – “to procure the necessities of the sańgha through
purchase or barter and to make these articles ‘allowable’ (kappiya) by formally
offering them to the sa ńgha” (Gunawardana, 1979, p.99). It is likely that with the
passage of time and the increasing complexity of monastic affairs many lay people
may have been needed to share the various duties of kappiyakāraka. They also
seem to have assumed different designations in accordance with their duties. For
example, Mihintale Inscription (956–971 AD) shows a number of official designa-
tions yet it does not specifically refer to a kappiyakāraka as such. Irrespective of
the varying names used for their designations, however, a common complaint
against lay officials of the monastery was that they were misappropriating the pro-
duce of monastic property (Gunawardana, 1979).
With respect to the type of administration of the monasteries, Dias (2001)
points out that during the ninth and tenth centuries, a committee system of admin-
istration prevailed.5 This is to be expected for several reasons. First, the monas-
teries had a substantial amount of resources at that time and, as described earlier,
the disciplinary rules restricted monks’ direct involvement in administering these
resources. Second, the most common resource, productive land, needed to be man-
aged for the monasteries’ benefit. Third, the monasteries grew in size and expanded
109
their activities into various regions, making it necessary to delegate various tasks to
others.
There are references to an assembly of monks, and according to Perera (2005)
this refers to a selected group of monks, not the entire community of monks. It
appears that it is the assembly of monks who exercised the final authority over the
monastery’s disciplinary and administrative matters. Specifically, Perera states that
the “consent of a general assembly of monks” had been required for the ordination
of monks, and “ … assembly of monks is most often mentioned in connection with
the audit of accounts … ” (Perera, 2005, p.217).
Many official designations are mentioned in the inscriptions indicating that a
complex administrative system operated in the monasteries. Based on the details
given in the Mihintale Tablets, Gunawardana (1979) refers to a committee of man-
agement known as kamtän (or kam-tän) and this committee seems to include eight
officials. The designations of the eight committee members mentioned in the
Mihintale Tablets are the chief monk of the monastery, the chief administrator, the
administrator of rules, the revenue officer or the collector of income, the pask
kämiya or the accountant,6 the scribe or clerk of the monastery, the registrar of cas-
kets, and the purser or keeper of caskets (Gunawardana, 1979, pp.101–4;
Ranawella, 2004, p.280). With the exception of the chief monk, the other designa-
tions are likely to have been held by lay people (Gunawardana, 1979).
As the affairs of the monastery became complex, many lay officials were
charged with administrative duties that created issues of misappropriation of monas-
tic wealth by these lay officials. As a consequence, a need emerged to monitor the
activities of these monastic officials. Both monks and the king had appointed lay-
people to different monastery offices, making it probable that some of the monitor-
ing practices of state institutions – familiar to officials appointed by the king – were
also introduced (Gunawardana, 1979). There is another reason for the king’s inter-
vention in monastic affairs. “The king of Ceylon was regarded as the secular head of
Buddhism who protected the Sāsana” (Rahula, 1956, p.66). Thus as the guardian and
protector of the state religion, the king had always shown an interest in monastic
affairs. From time to time there had arisen a need for the king to purify the Sāsana
(or Buddhist religion). Rahula (1956) states that:
kings engaged in the purification of the Sāsana, whenever they found it to be

disorganized or corrupt … [or] whenever there arose within the sańgha dis-
putes that could not be easily settled by the monks themselves. (Rahula, 1956,
p.67)
This important role of the king, although he is a member of the laity, must have pos-
itioned him and legitimized his direct intervention in monastic affairs whenever the
circumstances warranted such an intervention. Undoubtedly, the difficult balance a
king had to maintain between winning the support of the Sangha, and protecting the
110
Buddhist religion or Sāsana and its sanctity, must have presented an interesting chal-
lenge, which limited intervention to only very powerful kings.
All these factors may be offered as explanations for the existence of a sophis-
ticated administrative system in Sri Lanka’s main monasteries during the ninth
and tenth centuries and for the complex relations among the Buddhist clerical
community, the king and his officials, and the lay officials of the monasteries. Of
special interest to this article is the use of accounting and auditing practices as part
of this monastic administration system, which will be discussed next.
Results and discussion

Evidence of accounting and auditing practices
The specific rules that required accounts to be kept and the periodic reading and
hearing of these accounts are evident from inscriptions. Perera (2005) has identi-
fied the following inscriptions that contain details about the keeping and reading
of accounts of the Abhayagiri Vihāra:
Anuradhapura slab inscription of Kassapa V (913–922)

Jetavanārāma inscription of Mahinda IV (956–971)
Mihintale Tablets of Mahinda IV (956–971)
An examination of inscriptions translated by Ranawella (2001 and 2004) shows

another inscription that includes details of the account keeping activities of
Mahāvihāra (the oldest of the three main monasteries found in the ancient
Anuradhapura kingdom), namely, Dambegoda Pillar Inscription (956–972). This
inscription is important as it helps to demonstrate that the requirement to keep
accounting records and publicly read these at an annual gathering of monks was
not applied selectively to only one monastery. The details of accounting require-
ments contained in these inscriptions are described next.
Anurādhapura slab inscription of Kassapa V (913–922)

This inscription shows details of record keeping and the reading of such records
aloud annually, relating to the Abhayagiri Vihāra (Ranawella, 2001). Various parts
of the monastery are described and the income and expenditure of these parts
were required to be examined and recorded. One relevant paragraph of the
inscription reads as follows:
The image-house, the st ūpa, the Mahābodhi-ghara, the Ratna-pāsāda, and the
Refectory, all the aforementioned places, which are attached to the
Abhayagiri-vihāra, shall be inspected by the chief monks of the two fratern-
ities and of the six āvāsas at the end of the year and thereafter prepare a record
(of income and expenditure). This record shall be read out in the midst of the
congregation of monks. (Ranawella, 2001, p.335)
111
Explaining further the accounting requirements contained in the Anurādhapura

slab inscription of Kassapa V, Perera (2005) writes:
The income and expenditure shall be enquired (and recorded) by eight

persons … selected by agreement between … the monks and they shall at the
end of each year draw up a statement of accounts which shall be read before
the great assembly of monks. (Perera, 2005, p.275)
It is interesting to note the number of people entrusted with this examination of

income and expenditure and the fact that their selection was agreeable to the con-
gregation of monks. It is probable that the eight officials were those included in the
committee of administration or kamtän.
Mihintale Tablets (or Mihintale slab inscriptions) of Mahinda IV (956–971)

The Mihintale Tablets contain rules that distinguish the daily control of finances
from “ … the recording of accounts and submitting of the financial statement”
(Perera, 2005, p.275). As stated in Perera (2005), some of these rules are as follows:
1. a. [The chief monk and officials] shall see to the business of the office and
shall attend to both income and expenditure.
b. … security shall be taken from suitable kudīn [tenants] and shall be de-
posited with the kam-tän [the committee]
c. When kämiyan [workmen] are to be dismissed whatever has to be entered
in the accounts shall be taken before dismissal
d. Caskets furnished with locks shall be deposited in the relic house in the
presence of the officials of the relic house with the seal of the officials of the
kam-tän duly stamped upon them
2. a. Except what has been given out as divel7 to those receiving maintenance,
from lands and villages belonging to this vihāra, the manner in which these
lands are distributed as maintenance shall be entered in registers with the con-
currence of the kam-tän
b. Whatever is spent daily … shall be entered in registers and a statement of
accounts made … Entries such as are found false shall be expunged from the
register
c. Every month the statement of accounts placed in the caskets shall be made
into one statement and with the twelve statements of accounts one balance
shall be made at the end of the year
d. This shall be read out and concluded in the midst of the monks. (Perera,
2005, p.276–7)
Ranawella (2004, p.280–2) provides a complete translation of the above inscription

and relates it to the affairs of Sägiriya and Abhayagiriya monasteries. An examin-
ation of this translation shows that the details pertaining to keeping and reading
accounts provided in Perera (2005) are accurate. Further it shows that the inscrip-
tion contains detailed rules of administration and penalties for non-compliance
112
with the rules. Some rules prohibited monks from enjoying the benefits reaped
from fields belonging to the monastery:“The monks residing in this monastery shall
by no means enjoy (the benefits of) the fields, orchards, etc. … ” (Ranawella, 2004,
p.280). Others prohibited lay officials from benefiting from their official positions:
“They shall not accept presents from tenants, nor shall the officials take domesti-
cated oxen from them and have their own fields cultivated” (Ranawella, 2004,
p.282). On the issue of penalties for infringements by officials it was stated that:
“The houses of the officials who infringe these regulations shall be confiscated and
they shall be dismissed from the service” (Ranawella, 2004, p.282).
This inscription also shows clearly that there was an interest in maintaining
uniformity in the regulations and accounting and auditing practices. For example,
it was stated in the inscription that:
… the code of regulations (observed) at Abhayagiri-vehera, after consulting

fitting persons and (both parties) agreeing that it is worth instituting the same
at this (Sagiriya) monastery in respect of the great community of monks, the
officials, and the servants living in this monastery, their (respective) duties,
receipts and disbursements (of revenue), thus making them attentively uni-
form. (Ranawella, 2004, p.280)
Jetavanārāma inscription of Mahinda IV (956–971)

The accounting requirements contained in the Jetavanārāma Slab Inscription No.2
read as follows:
Annually the monks of the six āvāsas [monastic cells] shall be convened, when
the royal officials and the monastic officials shall read out in the presence of
the community of monks the records kept at the aforementioned places, indi-
cating how the income has been derived and the expenses were incurred, how
the wages had been paid to the servants, and how the tithe tenures had been
assigned. Should any dispute arise with regard to these matters, the high dig-
nities of the Court of Justice shall sit in session and settle that dispute.
(Ranawella, 2004, p.257)
Dambegoda Pillar Inscription (956–972)

Unlike the above inscriptions which show the accounting practices of Abhayagiri
Vihara, this inscription shows the accounting requirements to be adhered to by
Mahāvihāra at Anurādhapura. Ranawella (2004), who provides a full translation of
the Dambegoda Pillar Inscription, helps identify the accounting requirements it
contains.
Records of income and expenditure of the (above mentioned places) should

be maintained, detailing how the incomes due to those places had been col-
lected, and the details of the expenses, such as the wages paid to the servants
(attached to those places), the balance (of income) left after expenditure
should be retained as non-transferable goods … (Ranawella, 2004, p.267)
113
As the earlier discussion shows, notions such as systematic record keeping, internal
control (for example requiring more than one person to perform an accounting
activity), periodic closing of accounts, audits, and accountability and their
relevance to organizational administration, seem to have been well-established in
ancient Sri Lanka. Accordingly, the details contained in the inscriptions, some dis-
cussed in detail earlier, could provide evidence for the existence of sophisticated
accounting and auditing practices that were demanded by an equally sophisticated
organization and the rules and regulations that prevailed in Sri Lanka during 815 to
1017 AD.
The specific sources of the origin of accounting and auditing practices of Sri
Lanka are not clear. However, given the significant Indian influence on religious
and social affairs of Sri Lanka, the fiscal administration including accounting and
auditing too could be safely traced back to an Indian origin. For example,
Kautilya’s Arthaśāstra (circa 300 BC), which is the earliest treatise on accounting,
dates to the Maurya period of India (circa 321 BC to 184 BC) (Mattessich, 1998;
Sihag, 2004). The Great Chronicle of Ceylon (sixth century AD) refers to Cānakka
(or Kautilya) in its description of the ending of the Nanda Dynasty of India by
Chandragupta Maurya (with the help of his political adviser Kautilya) who began
the Maurya period of India (Geiger, 2003, p.27). This shows clearly that Kautilya
(and his work) was known in Sri Lanka. Therefore, it could be inferred that the
accounting ideas expounded by Kautilya’s Arthaśāstra were known among the
merchants and those in the state administration in Sri Lanka, thus permitting their
application in the fiscal administration of the monasteries.8
There are some interesting parallels between the accounting and auditing
practices recommended in the Arthaśāstra and those found in the Buddhist
monasteries.9 For example, the notions of revenue, expenditure, and net income
were apparent in the record-keeping practices of Buddhist monasteries. The spe-
cial status accorded to the net income had been identified in the Dambegoda Pillar
Inscription, which stated that net income “be retained as non-transferable goods”
(Ranawella, 2004, p.267). More importantly, these notions appear to be based on
receipts and payments basis, which is similar to the basis found in the Arthaśāstra
(Choudhury, 1982). Furthermore, the Arthaśāstra emphasizes the importance of
categorizing expenditure into different types (Choudhury, 1982; Mattessich, 1998),
thus permitting kings and/or his officials to identify and manage each type of
expenditure. The Mihintale Inscription shows a similar practice of classifying the
expenditure into different types (for example maintenance of the refectory;
amounts spent on employees; renovation work; Ranawella, 2004, p.282).
Summarizing details monthly into a single statement and again into an annual
statement by combining the twelve monthly statements is another feature common
to both the monastic practice and the Arthaśāstra. Similarly, the need to conduct an
114
audit is clearly evident in both practices. There appear to be some differences

between the Arthaśāstra and the Buddhist monastic practice of accounting as well.
One important absence in the monastic accounting practice is the requirement to
forecast revenue as suggested in the Arthaśāstra (Rangarajan, 1992, p.275).
Another difference is the absence of classification of revenue into three major
types in the monastic record-keeping practice (Rangarajan, 1992, p.275; Kautilya
prescribed three types of income, namely, current, transferred and miscellaneous
income). This latter difference however needs to be looked at with caution, as the
epigraphic evidence available relates mainly to the requirement as opposed to the
detailed instructions for record keeping. The fact that inscriptions refer freely to
accounting and auditing requirements, however, suggest that detailed record keep-
ing practices were well known at the time. Also, the accounting and auditing prac-
tices prescribed in the Arthaśāstra were for the state and, these would have
evolved to suit the requirements of specific institutions such as the Buddhist
monastery, thus leading to differences between the two practices.
A specific date for closing the accounts, or a financial year end, has been
identified in one inscription “ … as the eighth day of the waning moon of the
month of Vap [October]” (Perera, 2005, p.279). As stated in Perera (2005, p.280) “…
day of this lunar month is the day of the Hindu festival, Dipāvali, on which date it
is the custom among the merchants in India to close their yearly accounts”. This
date for closing accounts, however, is different from the date suggested in the
Arthaśāstra (that is the full moon day of July, Choudhury, 1982, p.108). Irrespective
of this difference in dates, the practice of closing accounts annually is clearly evi-
dent. Accordingly, the accounting practices that prevailed in the Buddhist monas-
teries could have been a reflection of the similar practices that prevailed among
merchants of India and of Sri Lanka during this period. Although epigraphic data
is available relating to the affairs of the monasteries, similar detailed evidence con-
cerning the affairs of merchants is not available (at least in the form of inscrip-
tions). There are several plausible explanations for the unavailability of such
details. One is that the affairs of merchants may not have been of such social sig-
nificance to warrant the committing them to inscriptions. Another vital reason for
the unavailability of details pertaining to commercial activities is the prevalence of
a practice to destroy documents after the agreements were fulfilled (Rahula, 1956,
p.242). The fact that many grants were made by the kings and the stone or rock
inscriptions used to document these could also explain the availability of data
relating to the Buddhist monasteries. Making a comparison of accounting and
auditing practices of monasteries and of merchants in the ninth and tenth centuries
therefore is difficult.
As identified in the introduction, this article aims not only to provide evidence
of accounting and auditing practices but also to delineate a religious institution’s
115
motives that underpin the use of such practices. Some of these motives have
already been presented or hinted at in the earlier sections of this article. In sum,
the need for accounting and auditing practices of monasteries stems from the dele-
gation of monastic duties to various lay people to reconcile the administrative
demands brought about by increased wealth and the disciplinary rules that
restricted monks’ direct involvement in administration; the geographical spread of
monastic affairs making it difficult to directly observe the activities of small tem-
ples by the main monastery; questions about the religious commitment and
decreasing discipline of some members of the Buddhist clerical community; and
the possible misappropriation of monastic property by various lay officials.
There are several additional reasons that warrant further discussion. First,
a substantial part of the country’s wealth was used to finance the monasteries and
to construct religious edifices (De Silva, 2005). This made it vital that the king and
the royal officials take a keen interest in the financial affairs of the Buddhist
monasteries. As mentioned earlier, the king himself sometimes appointed the lay
officials to the administrative committee of the monastery. This could bear witness
to the king’s interest in protecting the wealth of the monasteries, a significant part
of which was from the state treasury. As a consequence, the state officials could
have introduced measures familiar to them in fiscal administration to prevent the
misappropriation of monastic wealth.
Second, the king as the official guardian of the Buddhist religion (Sāsana)
(Rahula, 1956), had reasons to maintain the good name of the Buddhist monastery
and its community.10 Therefore, maintaining greater accountability and openness
could be considered as important to avoid unfair accusations against the Sangha,
to deter any monk or lay-official who would be inclined to compromise their
duties, and to settle any disputes relating to the administration of the monasteries
promptly. It is important to note that the inscriptions also include various rules
relating to the daily activities of monks themselves. A passage in the Mihintale
Inscription reads:
That the monks residing in this monastery shall rise at the time of early dawn
and shall meditate on the four protective formulae … If [monks] commit acts,
such as buying and selling etc. … they shall not be permitted to live [in the
monastery]. (Ranawella, 2004, p.280)
This too suggests that the kings were keen to protect the good name of the
monastery by keeping it free from those who were not genuine in their religious
pursuits. Improving openness and accountability of the financial affairs of monas-
teries, along with the need to keep and audit accounting records to facilitate these
aims, could therefore be understood as important measures taken by the kings (in
consultation with the leaders of Buddhist clerical community) in their attempts to
secure the good name of the Buddhist religion.
116
Conclusion
This article has described the ancient accounting and auditing practices that pre-
vailed in Sri Lanka during 815 to 1017 AD and discussed the Buddhist monastery,
its prominence, resources and administration. Using evidence from inscriptions, it
shows that detailed accounting practices prevailed in Sri Lanka during this time.
The presence of a prominent organization – the Buddhist monastery – the practice
of making grants to the monasteries, the decline in discipline and the emergence
of misappropriation of wealth in monasteries during this period, and the king’s
duty to protect one of the most prominent institutions of Sri Lankan society, could
be taken as the key driving forces behind the development of accounting and
auditing practices in ancient Sri Lanka.
In conclusion, it appears that the utility and practice of accounting and audit-
ing was well known in ancient Sri Lanka. A major source of influence of this
knowledge appears to be Indian, especially, the Arthaśāstra written by the Indian
sage Kautilya (fourth century BC). Taking into account the peculiar nature of the
Buddhist monastery in ancient Sri Lanka, this study concludes that accounting and
auditing were relied upon to maintain the reputation of the monastery, its mem-
bers, and more importantly, to maintain goodwill among Buddhist monks, rulers
and people. Accordingly, this study affirms the conclusion of a recent study on
accounting and accountability in ancient Mesopotamian and Egyptian societies,
which states that: “ … accounting from its genesis has been a powerful mediating
institution among individuals, organizations and society” (Carmona & Ezzamel,
2007, p.200). The prevalence of accounting and auditing practices in ancient Sri
Lanka also adds further support to the theory that the origin of record keeping and
accounting practices is ancient.
Notes
1. The terms accounting and auditing are used in this article for simplicity and con-
venience. While ancient practices bear some resemblance to what we mean by
these terms, they only included the keeping of simple records of some form or the
other in an understandable and reasonably complete form, and the periodic public
reading of these records.
2. The beginning of a formal European influence on Sri Lanka and its society dates
back to the arrival of the people of Portugal in 1505 (De Silva, 1995).The Portuguese
managed to occupy some parts in the northern and western regions of Sri Lanka. In
1602, the Dutch people arrived in Sri Lanka on the eastern coast and, after a battle
for occupied territories, they managed to gain control over the areas occupied by the
Portuguese. The Dutch occupation in Sri Lanka ended in 1802, when the British
gained the control of all provinces except that of the Kandyan Kingdom.
117
3. The earliest inscription of Sri Lanka dates to the late third to early second century BC
(circa 207–197 BC) (Karunaratne, 1984). The script used is the Brāhmī script of India.
Paranavitana (1970) provides a comprehensive study of inscriptions of the early
Brāhmī script in Ceylon. These inscriptions were similar to the rock edicts of the
Maurya period inscribed during the reign of Asoka of India in the third century BC.
4. According to the chronicles, the time of the Buddha falls in 563–483 BC.
Chandragupta found his Mauryan Empire with the help of his political advisor
Vishnugupta Chanakya Kautilya. Although the exact date of birth or death of
Kautilya is unknown, it is clear that he lived around the time of King
Chandragupta’s rule (321–297 BC). Therefore it is clear that the corporate form of
organization the Buddha thought of for the Sangha was not influenced by
Kautilya’s ideas about organizations.
5. During the ninth and tenth centuries, a committee system of management in the
administration of monasteries is also known to have been used in the administra-
tion of South Indian Hindu temples (Gunawardana, 1979). Given the closer rela-
tions between Sri Lanka and India at the time, one would expect such similarities,
although according to Gunawardana (1979, p.105) a direct comparison between the
two committee systems is difficult to make due to a lack of details in the inscrip-
tions available in South India, especially those that relate to the various types of
officials or designations.
6. Gunawardana (1979) describes the designation of the committee member pask
kämiya as the accountant of the monastery. However, in another inscription, the
term ganaka had been used to identify the accountant of the city of Anurādhapu-
ra (that is Thūpārāma slab inscription, Ranawella, 2005, p.88–90).
7. The term divel means property granted to officials who were employed by the state
or monasteries (De Silva, 2005, p.xii).
8. In the Indian Ocean, Sri Lanka had been an important stopover for seafaring mer-
chants and travellers and trade was an important part of Sri Lankan economy dur-
ing ancient times (Ray, 2003, pp.201–6). Therefore one cannot entirely rule out the
possibility of an indirect influence of Greek or Arabian practices used by mer-
chants on Sri Lankan accounting and auditing practices.
9. Reading accounting records aloud publicly is a practice that prevailed in manorial
audits in medieval England. This may invite a comparison between ancient
accounting and auditing practices of Sri Lanka and those practices prevailed in
manorial accounting. Making such a comparison is, however, beyond the scope of
this article and it presents an important opportunity for future research.
10. There is little doubt that this issue was of vital concern to the leaders of Buddhist
clerical community as well. Inscriptions show clearly that the kings had often acted
in consultation with the leaders (monks) of the monasteries when issuing regula-
tions pertaining to the fiscal administration of monasteries. The Mihintale inscrip-
tion states that: “ … after consulting fitting parties and (both parties) agreeing that
118
it is worth instituting the same [regulations]” (Ranawella, 2004, p.280). It is fair to

claim that “fitting parties” included those monks involved in the administration of
the monastery (for example the Resident Chief Monk) on the one hand and the
king and his officials on the other.
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Civilizations: Mesopotamia and Ancient Egypt”, Accounting, Auditing and
Accountability Journal, Vol.20, No.2, pp.177–209.
Choudhury, N. (1982), “Aspects of Accounting and Internal Control: India 4th Century
BC”, Accounting and Business Research, Vol.12, No.46, pp.105–10.
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Geiger, W. (2003), Mahavamsa: The Great Chronicle of Ceylon, Dehiwala, Sri Lanka:
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Concepts in Kautilya’s Arthaśastra”, Accounting, Business and Financial History,
Vol.8, No.2, pp.191–209.
Mendis, G.C. (2005), The Early History of Ceylon, New Delhi:Asian Educational Services.
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I (from 831 to 1016 AD): Political Institutions, Kandy: International Centre for
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Rahula, W. (1978), What the Buddha Taught, London: Gordon Fraser.

Ranawella, S. (2001), Inscriptions of Ceylon, Volume V, Part I (from 815 to 923 AD),
Colombo: Department of Archaeology.
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Colombo: Department of Archaeology.
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of Archaeology.
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and Introduced), New Delhi: Penguin.
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Acknowledgements: Thanks are expressed to two anonymous reviewers and the

guest editor, Nola Buhr, for their helpful comments and suggestions for improving
this article. Helpful comments received from two anonymous reviewers on an ear-
lier version of the article submitted to the fifth Accounting History International
Conference, 9–11 August 2007, Banff, Canada, and the comments received from
conference participants are also gratefully acknowledged. The author is also grate-
ful for financial support from the Staff Research Grant Scheme of the Department
of Accountancy and Business Law, University of Otago.
Address for correspondence: Gregory A. Liyanarachchi, Department of

Accountancy and Business Law, University of Otago, PO Box 56, Dunedin,
New Zealand. E-mail: gliyanarachchi@business.otago.ac.nz
120

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Accounting History

Keywords: Accounting; ancient Ceylon; Anurādhapura kingdom;

Copyright © 2009 SAGE Publications 101

Table 1: Names of kings and inscriptions during

Name of king No. of inscriptions

Sources: Ranawella (2001, p.xvi; 2004, p.v), Perera (2003).

Buddhist Sri Lanka

As a result of the involvement of monasteries in all spheres of society – spiritual,

Immunities and regulations

of temple servants, management of temple land and distribution of its income”, a

kings engaged in the purification of the Sāsana, whenever they found it to be

Results and discussion

Anuradhapura slab inscription of Kassapa V (913–922)

An examination of inscriptions translated by Ranawella (2001 and 2004) shows

Anurādhapura slab inscription of Kassapa V (913–922)

Explaining further the accounting requirements contained in the Anurādhapura

The income and expenditure shall be enquired (and recorded) by eight

It is interesting to note the number of people entrusted with this examination of

Mihintale Tablets (or Mihintale slab inscriptions) of Mahinda IV (956–971)

Ranawella (2004, p.280–2) provides a complete translation of the above inscription

… the code of regulations (observed) at Abhayagiri-vehera, after consulting

Jetavanārāma inscription of Mahinda IV (956–971)

Dambegoda Pillar Inscription (956–972)

Records of income and expenditure of the (above mentioned places) should

audit is clearly evident in both practices. There appear to be some differences

it is worth instituting the same [regulations]” (Ranawella, 2004, p.280). It is fair to

Rahula, W. (1978), What the Buddha Taught, London: Gordon Fraser.

Acknowledgements: Thanks are expressed to two anonymous reviewers and the

Address for correspondence: Gregory A. Liyanarachchi, Department of

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