Reviewed by Rasoul H. Tondkar Virginia Commonwealth University
Jones’s English System of Book-Keeping has probably had more influence than any other single document on the development of double-entry accounting into an integrated system. Rather than making a direct contribution, it has led many critics of this treatise to look at the logic of double-entry accounting and articulate various accounts into a coherent system. (p. 13)
Originally published in 1796 in Bristol, England, it was reprinted in 1978 in New York by Arno Press from the 1796 edition. The current edition begins with an introduction by Professor Basil S. Yamey. In this section, the sequence of events leading to publication in England is discussed. Apparently, its initial publication aroused criticism in England and in other European countries. The introduction provides the reader with an excellent background and facilitates a better understanding of the book.
Following Professor Yamey’s comments is Jones’ address “the commercial and trading world.” In this section, Jones looks at the business environment and accounting systems of his time. He explains how a successful business enterprise can be transformed into a bankrupt one by a deficient accounting system. Furthermore, he examines some of the bankruptcies of that time and places blame on the single and double-entry systems being used. Finally, he claims that his system of bookkeeping will eliminate the potential of related frauds and business failures.
In the second section of his book, Jones compares the old system to his new one. According to Jones, single entry accounting is simple and easily understood. Further, he views double-entry accounting as complex and obscure and as placing a great reliance on the trial balance to detect any error or fraud. He then argues that if the original entries are not properly recorded and posted, the trial balance becomes meaningless. He rejects existing systems on the grounds that they are susceptible to numerous errors and frauds, a deficiency which is eliminated by his system. He also suggests that his system can be adapted to the double-entry accounting system. Through this adaptation, one can maintain separate accounts for each item and still get the benefit of the accuracy that his system offers. This compromise suggests that Jones has forgotten that he has violently attacked double-entry accounting earlier.
Jones details the mechanics of his system in the third section. The transactions are first entered in one column of the journal in a manner much like that of single entry bookkeeping. The entries from this column are later extended to two additional columns in the same journal; one is a debit column to the left of the original column and the other is a credit column to the right of the original column. The totals of the original middle column must equal the totals of the debit and credit columns. Jones places much emphasis on this procedure to detect error and fraud. These entries are then posted in alphabetically arranged ledger accounts.
Jones suggests that it is useful to periodically reconcile the totals of debits and credits in the ledger against the totals of debits and credits in the journal; these totals must agree at all times. This type of reconciliation was later developed by the double-entry accounting system. He goes on to suggest that statements can be prepared directly from the journal. Some critics believe that the above suggestions constitute Jones’s indirect contribution to the development of double-entry accounting. Finally, Jones proposes a plan by which his system can be taught and he provides an illustration of his system.
A valuable source to those interested in accounting history and in the development of double-entry accounting into a coherent sys-tem, this book is also appropriate for use as assigned reading in any undergraduate course where an exposure to the development of double-entry accounting is desired.
