HENRY WHITCOMB SWEENEY
By A. N. Mosich University of Southern California

Henry Whitcomb Sweeney made significant contributions to both the academic and professional segments of accounting. Although his most famous work is in price-level accounting, his writings also embraced accounting theory, taxation, cost accounting, government contract accounting and auditing. His achievements as an accountant, professor, author, lawyer, and public servant have been an inspiration to many. Sweeney’s distinguished career included service as Pentagon aide in 1951-53 and Deputy Assistant Secretary of Defense in 1964-65.

Sweeney was born in Springfield, Massachusetts on September 12, 1898, and died on September 1, 1967. He attended Amherst College and received B.A. (1919), B.S. (1920), M.S. (1921), M.A. (1924), Ph.D. (1936) and LL.M. (1960) degrees from Columbia University. He also earned the LL.B. degree from Georgetown University in 1940.

In 1924, at the age of 26, he chose accounting valuation for his doctoral dissertation topic under the guidance of Professor Roy B. Kester. The requirements for his dissertation would cause many current doctoral students to wince—the dissertation had to be an original contribution to knowledge, be published, and prove prac-tical in application.

In 1925 he accepted a position on the audit staff of Price Water-house & Co. in New York City where he worked until 1935. Prior to this time he was learning and teaching. He became a CPA and while teaching at the University of Wisconsin had written Bookkeeping and Introductory Accounting, published by McGraw-Hill Book Company in 1924.

In May 1927, he submitted the first draft of Stabilized Accounting, about 400 typewritten pages, in a nation-wide Economics Contest and won the $500 prize. A condition of the award was that it had to be ready for publication within two years. Sweeney let the prize lapse so he could continue to improve his work. Early in 1933 he passed an oral defense of his third voluminous draft of Stabilized Accounting but was unable to find a publisher.

In 1934 he married Mae Edith Fichter, and then in the spring of 1935 he withdrew from business for two and one-half months to revise and shorten Stabilized Accounting for publication. The plan he developed was to publish lengthy explanations as journal articles and refer to them by footnote so that the exposition of the book would thereby be complete. In 1936, one thousand copies of the book were printed by Harper.

In 1935 Sweeney commenced government service—as a supervisory bank examiner and then as Chief Accountant for the Navy Contract Appeals Board. In 1943 he accepted a Washington partnership in a New York City law firm, but quickly learned that 22 years of accounting experience was not readily transferred to the practice of law. He therefore opened a CPA office and in 1944 resigned from the law firm to specialize in government contracts and income taxation in order to utilize his knowledge of both law and accounting.

From 1936 to 1944, Sweeney was a professor of accounting at Georgetown, and he was also a professor of law at Georgetown Law School from 1941-58. He taught accounting as adjunct professor in the Graduate School of Business at Columbia from 1956 to his death in 1967.

Stabilized Accounting was a new and complete treatment of ac-counting for gains and losses from changes in purchasing power. Today accountants and businessmen are fully aware of the deficiencies in accounting for dollars representing various price levels. But at the time Sweeney wrote it was necessary to painfully explain how historical cost accounting failed to provide for maintenance of pur-chasing power through maintenance of capital. Sweeney believed that a monthly cost-of-living index was the ideal deflator, because men hold money for its ultimate purchasing power of general goods and services.

Accounting Research Study No. 6: Reporting the Financial Effects of Price-Level Changes, published by the AICPA in 1963, essentially adopts the scheme worked out by Sweeney. In Sweeney’s review of ARS No. 6 in the October 1964 issue of The Accounting Review he stated: “To review the Study’s main concepts, therefore, places this reviewer in the anomalous position of practically reviewing his own work.” Unfortunately Sweeney did not live to witness adoption in 1969 of APB Statement No. 3: Financial Statements Restated for General Price-Level Changes, which included guidelines for preparing financial statements adjusted for changes in the general price levels.

At the meeting of the American Accounting Association in 1937, Sweeney was told that he was fifty years ahead of his time. The time has come for us to catch up with Henry Whitcomb Sweeney.

(Vol. 1, No. 1, p. 4, 1974)