Elliott L. Slocum
and Alfred R. Roberts
GEORGIA STATE UNIVERSITY

THE NEW YORK SCHOOL ACCOUNTING — A BEGINNING

Abstract: Current developments in accounting education are the result of the vision and efforts of the early-pioneers in public accounting practice. Clearly these accountants wanted to elevate public accounting to a professional level. Their belief that collegiate accounting training was the foundation on which to build the profession of public accountancy led to the establishment of the New York School of Accounts. The New York School of Accounts was a success though it operated for only one year. It illustrated a commitment to education and undoubtedly influenced the later development of university and college accounting programs.

The teaching of accounting and business subjects in universities and colleges is primarily a twentieth century phenomenon in the United States. We have recently witnessed the establishment of several schools of accountancy and increasing debate concerning professional accounting education. These developments are the culmination of a process begun approximately a century ago with the establishment of the first organization of professional accountants in the United States and its effort to establish a school of accountancy. In this paper, we trace the efforts of the American Association of Public Accountants to establish the New York School of Accounts.

Harry C. Bentley, in listing the stages of development in bookkeeping instruction in the United States, indicates that university instruction began about 1881 .1 This date was undoubtedly chosen because the Wharton School of Finance and Economy was established in 1881 at the University of Pennsylvania. No other successful schools of commerce were established until 1898, and there were only seven such institutions at the close of 1900.2 Several unsuccessful schools of business or commerce predated the Wharton School.

A school of commerce was established in 1851 at the University of Louisiana, now Tulane University, but it was discontinued in 1857. An attempt to establish a college of commerce at the University of Wisconsin failed in 1866.3 The University of Illinois established a school in 1868 which became the School of Commerce in 1870 and operated until 1880.4 In 1869, General Robert E. Lee proposed a school of commerce at Washington College. The project ended with Lee’s death in 1870 and because of financial limitations.

Although business colleges and proprietary schools provided instruction in the art of bookkeeping, Webster stated that “up to 1891 no organization in the United States had planned to provide educational facilities for public accountants.”

The Accounting Profession and Education

Organized professional accounting in the United States effectively began with the American Association of Public Accountants in 1887. The Certificate of Incorporation included among the purposes of the Association: elevation of the profession of public accoun-tants, observance of strict rules of conduct, and establishment of a high standard of professional attainment. A high standard of professional attainment was to be achieved “. . . through general education and knowledge and otherwise;. . . .”7 What was intended by “general education” is not known, but it does indicate concern for the education of public accountants. Events within the next five years would suggest that at least some of the incorporators had envisioned the need for a collegiate – type of training for public accountants.

Webster’s chronology of the first twenty years of the Association identifies 1886-1891 as a period of “promotion and organization” and 1892-1894 as a period of “reorganization and education.”8 The Association had made little progress in membership during 1886-1891. Webster stated that the minutes of the Association in the last days of 1891 indicated that some new policy or project was creating new interest and membership growth. The new policy or project was probably the effort of the Association to establish the New York School of Accounts.9 As the result of the efforts of the Association’s Board of Trustees and the Charter Committee, a two year provisional Charter to the New York School of Accounts was granted on December 14, 1892.10 At the January 17, 1893, meeting, President James Yalden reported:

Since we last met the Board of Regents at Albany have forwarded to us a Charter for the Incorporation of the New

York School of Accounts. . . . The object of the New York School of Accounts is to educate young men for the pro-fession of accountancy and also in the principles of com-mercial life.
. . . and I think the School will be a success. If it is, it will be the foundation of our profession and be the means of putting it on the same basis as the professions of law and medicine in this city; and eventually, no doubt, when the Regents see that we have carried out this scheme to their satisfaction, legislation will ensue that will raise the accountancy business to the position which we should all like to see it occupy.

Yalden’s remarks provide insight into the Association’s intent concerning education for the profession. The School was to provide education for public accountants, be a foundation of the pro-fession, be a means of elevating the image of public accounting to that of the legal and medical profession, and lead to legislation for accounting.
New York School of Accounts The New York School of Accounts had as its stated purpose:

. . . to provide for young men special means of train-ing and of correct and practical instruction in the knowledge and science of modern accountancy and finance, in order that, being well informed upon these important subjects, they may either serve the community skillfully as public accountants, business managers and officers of trust, or, remaining in private life, may prudently, economically and successfully manage their own affairs; in short, to establish means for imparting a liberal and practical education in all matters pertaining to the intricate science of accounts.

In the prospectus, several reasons were presented to support the establishment of the School: (1) the profession had grown to the point where it should be organized as is law, medicine, engineering, and architecture, (2) there was a lack of competent and reliable personnel available for public accounting practice, and (3) no in-stitution exiCted to provide the high level of business education to obtaIn practical information and education in the science of accounts.13

66 The Accounting Historians Journal, Fall, 1980
The Officers and Board of Trustees of the School were:
Dean John L. N. Hunt, LL.D.
Treasurer Richard M. Chapman
Secretary Thomas Bagot
Board of Trustees James Yalden, President of Board
John L. N. Hunt, LL.D. Louis M. Bergtheil
Richard F. Stevens George H. Church
Rufus G. Beardslee Henry R. M. Cook
Thomas Bagot Richard M. Chapman
F. B. Thurber Lucius M. Stanton
John B. Woodward14

John L. N. Hunt was the only educator on the Board of Trustees. Rufus G. Beardslee was a lawyer, Lucius M. Stanton and F. B. Thurber were merchants, and John B. Woodward was a banker.15 The others were practicing accountants. Several of the Trustees had been or were to serve as President of the Association: James Yalden, 1887-1888, 1891 -1892; Henry R. M. Cook, 1892-1893; and Richard F. Stevens, 1893-1896. James Yalden was one of the in-corporators of the Association. Richard M. Chapman served as Treasurer of the Association, 1891-1895. Thomas Bagot served as Secretary of the Association, 1892-1 893. Several were to serve on the faculty of the School.

The actual teaching faculty of the School is uncertain. The As-sociation Trustees on December 21, 1892, suggested to the School Trustees the following personnel:

Dean John L. N. Hunt, LL.D.
Professor of Public Accounts &c James Yalden
Professor of Judicial Accounts Louis M. Bergtheil
Professor of Transportation Accounts Richard F. Stevens
Professor of Insurance Accounts Wm. M. Brooks
Professor of Banking Accounts George H. Church
Professor of Mercantile Accounts Frank Broaker
Professor of Double Entry Louis Yalden
Professor of Double Entry Richard M. Chapman
Professor of Building Loans John W. Whitehead

Louis Yalden died two weeks before the School opened, and ap-parently W. Sanders Davies took his place. Henry R. M. Cook is also mentioned as Professor of Theory of Accounts. Except for Dr. Hunt, it is unlikely that any had experience in teaching. Stevens had graduated AB at Columbia College, and Broaker had attended the College of the City of New York but had not graduated. Brooks, Davies, and Yalden may have had some general education as part of their apprenticeship in Great Britain.

In order to enter the School, an applicant was required to be a graduate of a college or university registered by the Regents of the University of the State of New York having satisfactory stan-dards or have passed a “Regent’s examination.” Students stating their intention to enter public accounting were required to be a minimum age of nineteen. The age level for students not seeking a career in public accounting was left to the discretion of the Executive Committee.

All faculty, except for Dr. Hunt, were to be practicing public accountants. Law, Auditing, and some unspecified courses were to be taught by the lecture method. Instruction in all other courses was to be given by dictation, assisted by blackboard illustrations and by such textbooks deemed advisable by each professor and approved by the faculty. Theoretical illustrations were not to be used. Examples of actual business transactions provided by the instructor’s practice were to be exhibited, explained, and analyzed.18 Webster indicated that the program provided for 1,000 class hours over 40 weeks per school year with the complete program requiring two school years.19 The school year began on the first Tuesday of October and ended on the second Friday of June. The prospectus states that regular attendance of not less than eight months was considered equivalent to a year’s study.20 The course of study was divided into eight sections: Bookkeeping

Section 1 — The Science of Double Entry
Section 2—The Keeping of Books of Mercantile Accounts
Section 3—Corporate Accounts
Section 4—Judicial Accounts
Section 5—Public Accounts Auditing —
Section 6—The Examination of Accounts
Section 7—The Analyzing of Accounts and Compilation of
Statistics Law —
Section 8—The Principles of Law21

A written, comprehensive final examination was to be administered under the authority of the Regents. A diploma would be issued upon successful completion of the program by the University of the State of New York in its name and under its statutory power. Situ-dents not entitled to a diploma could obtain a certificate from the Dean on which was stated the length of study and attendance. The certificate would also attest to satisfactory standing in class and the student’s moral character.22
The School began operations in October, 1893. On July 11, 1894, the faculty passed a resolution recommending discontinuance of the School of Accounts and that the Trustees consider the return of the Charter to the Board of Regents.

A year has passed since the inception of the School of Accounts, and what has been accomplished? A class of seven pupils have gone through the year’s course—that is all. Not a business man has come forward to aid us in any way, the whole burden has fallen on the shoulders of a few of our members, now disheartened and disillusioned. The Board of Regents of the University have stood silent and aloof, not a word has been said about commissioning or licensing our members, and communications addressed to them on the subject of legalizing the profession by legislative enactment have remained unanswered. The members, under this state of affairs naturally have ceased to take interest in the school, the professors have resigned or been slack in their attendance, the scholars supine and the further continuance of the school in its present state seems idle.

The Charter lapsed and the New York School of Accounts ceased to exist. The Association apparently turned its attention to other matters of growth and legislation and made no more direct efforts to establish schools to train professional accountants. The discontinuance of the New York School of Accounts did not end the vision of many of the profession’s leaders nor the need for professional education and elevation of the profession’s image.
The School’s Influence on Accounting Education

The Association leaders appeared to have been impatient. Stevens’ comments indicate that the Association had expected rapid legislative action to legalize the accounting profession. Ac-counting legislation might have helped to establish much earlier the need for the high school diploma as a minimum educational standard. This might have reinforced the need for the School of Accounts and have encouraged college training for entrance into the profession.

That so much was accomplished is noteworthy when one realizes that the Association membership totaled 48 Fellows and 17 As-sociates on January 1, 1894. No precedent existed in the United States to provide guidance in curriculum development or teaching methodology nor were adequate textbooks and teaching materials available. Problems were compounded because the faculty’s primary purpose was to earn a living practicing accounting rather than teaching accounting.

John Carey states that the Association’s pioneering efforts probably contributed to the establishment of several proprietary schools of accounting and the growing interest in accounting education which led to the introduction of accounting courses in the universities.25 By 1900, accounting education in universities and colleges was growing. Thirteen universities and colleges offered accounting courses for credit, and six others provided noncredit bookkeeping courses.

The foundation of collegiate accounting education had been established by 1900, and its growth and development thereafter would be phenomenal. The vision of the early public, accountants who established the American Association of Public Accountants and the New York School of Accounts contributed greatly to the concept of collegiate accounting education as the basis for preparing for entrance into public accounting in the United States.

FOOTNOTES

1Norman E. Webster, The American Association of Public Accountants: Its First Twenty Years, 1886-1906 (New York: Arno Press, 1978), p. 163.
2Jeremiah Lockwood, “Early University Education in Accountancy,” The Accounting Review, Vol. XIII, No. 2 (June, 1938), p. 132.
Webster, p. 163.
4Lockwood, p. 132.
Webster, p. 163.
Webster, p. 165.
7The American Association of Public Accountants Year-Book, 1912-1913 (New York: The Ronald Press Company, 1913), p. 10.
Webster, p. 21.
Webster, pp. 32-34.
10Webster, p. 190.
70 The Accounting Historians Journal, Fall, 1980
11Webster, pp. 36-37.
12Prospectus of the New York School of Accounts (New York: The American Association of Public Accountants, 1892), p. 5.
13Prospectus, pp. 5-6.
14Prospectus, p. 4.
15Webster, p. 194.
16Webster, pp. 195-196.
17Prospectus, pp. 7-8.
18Prospectus, p. 9.
19Webster, p. 184.
20Prospectus, p. 9.
21 Prospectus, pp. 10-12.
22Prospectus, pp. 13-14.
23Webster, p. 197.
24″A History of the American Institute of Accountants,” The American Institute of Accountants (1887-1937): Fiftieth Anniversary Celebration, 1937 (New York City: American Institute of Accountants, 1938), pp. 5-6.
25John L. Carey, The Rise of the Accounting Profession: From Technician to Professional 1896-1936 (New York: American Institute of Certified Public Accountants, 1969), p. 42.
26C. E. Allen, “The Growth of Accounting Instruction Since 1900,” The Accounting Review, Vol. II, No. 2 (June, 1927), p. 150.
BIBLIOGRAPHY
“A History of the American Institute of Accountants,” The American Institute of Accountants (1887-1937): Fiftieth Anniversary Celebration, 1937. New York City: American Institute of Accountants, 1938.
Allen, C. E. “The Growth of Accounting Instruction Since 1900.” The Accounting Review, Vol. II, No. 2 (June, 1927), pp. 150-166.
Carey, John L. The Rise of the Accounting Profession: From Technician to Professional 1896-1936. New York: American Institute of Certified Public Accountants, 1969.
Lockwood, Jeremiah. “Early University Education in Accountancy.” The Accounting Review, Vol. XIII, No. 2 (June, 1938), pp. 131-144.
Prospectus of the New York School of Accounts. New York: The American Association of Public Accountants, 1892.
The American Association of Public Accountants Year-Book, 1912-1913. New York: The Ronald Press Company, 1913.
Webster, Norman E. The American Asssociation of Public Accountants: Its First Twenty Years, 1886-1906. New York: Arno Press, 1978.