Reviewed by Sandor Aszely
Gothenburg University, Sweden
Though we have comprehensive and scholarly studies in English and German of the history and development of accounting (Yamey, Penndorf and others), readers of The Accounting Historian might be interested in a study of the development in the Scandinavian countries, especially Sweden and Finland. This development was, to be sure, strongly influenced from Northern Germany and the Netherlands but had also characteristics deserving more than local interest. As to the influences from abroad, we have to bear in mind that Lubeck and the Hansa had a solid grip on the commerce of the Baltic region from the 12th to the 16th centuries and that the influence of the Low Countries became manifest after their independence from Spain and after they had established themselves as a worldwide naval and commercial power with considerable business interests in the Arctic regions and the Baltic Sea.
Grandell discusses in detail two of the simplest means of control and instruments of accounting of the old days, the scoring board and the tally. The scoring board was used as an aid to memory in the counting of physical units (loads, sacks, etc.) or as a control on work-performance. The oldest type was a board with 10×10=100 holes and a peg to put into the holes corresponding to the counted units. A later type had 10 holes in 3 columns for marking one, two and three digits respectively. The simple tally served the same purpose as the scoring board: as a memory-storage of the counts of stores or as a means of control of operations. It was just a stick upon which notches were cut for each operation carried out.
Another type, the divided tally, meant a considerable progress in the technique of accounting. It was split into two parts, one for either party—employer/employee or buyer/seller and so forth. Each time a notch was cut the two parts had to be fitted together. Then each party kept his own half in order to be able to control the correctness of the notches. It was fundamentally the same idea as the “indent”-form for certe parties of the East India Company. These simple means of control remained in use to a certain extent until the beginning of the present century.
Of considerable interest is the development of accountancy in Sweden and Finland after the separation from Denmark, during the reign of Gustavus Vasa (1523-60). He made his Exchequer work out an accounting system for the stewards of the royal castles and estates. His administration was depending on well planned and several methods of control and a budgeting system, which was centuries ahead of its time. It is also quite remarkable that double-entry bookkeeping was introduced into the accounts of the Crown as early as 1623 by a Dutchman, Abraham Cabiljau. Thus Sweden seems to have been the first country to introduce double-entry for keeping Governmental accounts.
A further development of more than local interest is that of industrial accounting in Swedish iron works, saw mills and other manufactories in the 17th century. Iron works in Sweden and Finland engaged skilled Walloon miners and blacksmiths as well as Dutch accountants. These bookkeepers established an accounting system, well adapted to mining and milling operations. At the middle of the 18th century this industrial accountancy in Sweden reached a rather high level, far above contemporary accounting in commercial business enterprises. Column technique—a sort of multidimensional accounting—personal accounts separated from the general ledger, and an accounting system enabling detailed cost estimates, were features that raised the bookkeeping of the iron works to a much higher level than that of the merchants.
Axel Grandell shares the view of Werner Sombart, B. S. Yamey and Y. Ijiri, that an efficient control-system based on double-entry bookkeeping was a prerequisite and cornerstone of capitalistic society. One might add that an efficient accounting system is probably still more important in modern society with the emergence of a mixed economy, a heavily expanding public sector and an enormous bureaucracy for planning and control.
(Vol. 2, No. 1, p. 9, 1975)
