Reviewed by Jeremy Cripps Heidelberg College

This anthology confirms Cicero’s assurance that history provides maturity because history is “the testimony of time, the lyric of truth, the embodiment of memory, the guide for life, and our audit of antiquity.” Professors Parker and Yamey, in an extensive work, provide us with fascinating contributions to accounting scholarship as they help to celebrate the 500th anniversary of Pacioli’s Suma de Arithmetica (1494). Successfully demonstrating the great variety of accounting history literature, the editors have brought together twenty-three stimulating papers by British academics. The material, mostly from the 1980s, combines chronology and theme, and the authors include “traditional,” “new” and “mainstream” accounting historians. The collection, as entertaining as it is relevant to our present time of rapid accounting change, is highly recommended.

The Testimony of Time

From ancient Egypt to modern Japan, the authors proffer evidence of simple ideas in accountancy which have had re-markable consequences. In the process they show us accounting’s arrow of time (the direction of time in which order in-creases). Professors Parker and Yamey arrange these changes in the accounting profession in sequence, before and after Pacioli’s ennobled text. Albeit arbitrary, Accounting History adopts eight classifications: the ancient world; before double entiy; double entry; corporate accounting; local government accounting; cost and management accounting; accounting theory; and accounting in context. The book invites the attention of all accounting historians and wishes we would value each others’ contributions. It is a fine invitation; we should not hesitate to accept.

The Lyric of Truth

In the second century A.D., Aurelius Appianus set up many phrontid.es (separate entities) in the Fayum area of Egypt [p. 15]. Separate accounts were used “to measure the monetary profitability of each of these units of the estate.” In his comprehensive review of these accounts, the managerial accounts of the Appianus estate, Professor Rathbone shows how they “counter the conventional picture” of rudimentary Graeco-Roman accounting [p. 16]. These monthly accounts may not record in full detail every operation and transaction which took place, “but they are a synthesis and distillation” [p. 33] which provided the Appianus family with “rigorous control of its costs of production” [p. 54]. Thus the adequacy of ancient accounting controls demonstrate they were appropriate to the available technology.

As Professor Macve shows, managerial accounts provided ancient businessmen useful subjective intelligence which was particularly appropriate to ancient patterns of economic activity [p. 84].

The Embodiment of Memory

In the twelfth and thirteenth centuries, manorial accounts, from Canterbury, Winchester and Beaulieu [p. 93] are used by Professor Harvey to demonstrate that a set of written rules were generally accepted for the oral presentation and audit of peri-odic accounts. These charge and discharge accounts present “how mankind once coped with conditions that now seem impossibly adverse .. . when paper was still unknown or costly, coins were scarce and bad, and most men were illiterate” [p. 97]. Structured phases of these accounts demonstrate “continuing developments” [page 107] in detail and layout, as our predecessor accountants approached the development of their records with open, flexible minds. Professor Postles, for example, docu-ments the “comparing” of accounts from one manor to others [p. 121] and the employment of “incentives” [p. 148] to assess and improve the level of profit.

Coping with adverse conditions, managerial accountants maintained records on tallies and checker boards. The recording of numbers “by notches carved on suitable objects is of great antiquity and was virtually a universal practice” [p. 200] and Professor Baxter’s history of the Tally and the Checker-Board includes, with detail, much high drama. The events of 1834 are but one example. On the morning of October 16, the Lords of the Treasury ordered most of the tallies (“which my Lords understand to be entirely useless”) to be destroyed. By afternoon, according to The Times, “one of the most terrific conflagrations that has been witnessed for many years” set the Houses of Parliament ablaze. Accounting History, like the tally’s end, provides us with exciting memories.

The Guide for Life

Professor Yamey examines procedures to make closing en-tries which were made in Italy from 1300-1600. He provides us with a comprehensive context within which to place the extraor-dinary genius of Luca Pacioli. I particularly enjoyed this chapter for the way in which Professor Yamey adds interest and signifi-cant questions for our consideration of present day issues. He wonders “whether and how frequently, say, the Medici or Datini had analytical summaries or abstracts compiled” [page 259] and examined them. Our students no doubt wonder about the time spent by users on financial statements today.

Our Audit of Antiquity

To “the Scottish Enlightenment,” [p. 268] where, as in the Renaissance, we find major developments in accounting with a roll call of luminaries, Adam Smith, David Hume, Sir Walter Scott, Robert Burns, and the accountants, Alexander Malcolm, John Mair, William Gordon and Robert Hamilton. Professor Mepham shows how they are a “complementary” part of that “general intellectual ferment” [p. 284] and recognizes these able accounting academics for the profound influence they exerted throughout the English speaking world. Professor Forrester, with equal precision, shows how, when and why for certain eighteenth and nineteenth century incorporated companies [p.

297]. Early canal company accounts provide primary evidence of the keeping of unprecedented details of expenditures to en-able supervision to be exercised over expanding operations. Audit is a freqpent and continuing responsibility. Professor Glynn documents the expansion of audit [p.333] as public interest and private interests inevitably conflict, require regulation, and, with the expansion of the railways, require the interests of the public to be taken into account. Professors Edwards and Newell examine “a largely unexplored area of business history” [p. 407], the application of accounting techniques in business management, particularly during the most innovative periods of the Industrial Revolution. Recent evidence in this field demonstrate “that fully integrated cost and financial accounting systems were in operation at the Charlton Cotton Mills (1810) and Lyman Mill (1854)” [p. 409].

Management accounting, particularly for the purposes of strategic planning, is also found several centuries before at Ashdown Forest (1539) and at the Worshipful Company of Bakers (1620) [p. 415]. New findings of ancient records are coming to light as forgotten archives are being recorded for library computer projects, providing primary evidence for new research.
Into the nineteenth century, and Professor Marriner recalls Winston Churchill’s description of operations at the Ministry of Munitions. “An extraordinary improvisation beyond precedent without parallel in any country in the world took place in our industrial system” [p.450]. This seems to me an appropriate audit report on Accounting History: Some British Contributions. Yet I still want to mention Robert Loder, Jacobean management accountant, important social challenges to accounting, the evolution of financial reporting in Japan, and more.

Here is a history of many of the frequent small develop-ments of accounting techniques, by authors too often unknown, which provide our profession benchmarks of progress, feathers on our arrow of time. The case for historical perspective is never better made than in this book.

REFERENCE

Cicero, “Pro A. Licinio Archia” 16, 15, in Orationes, Vol. 2, London: A. J. Valpy, 1830.