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    Chapter 1.2 Functions and History of Accounting

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    Zyryx Agregado
    Accounting has three main functions: (1) to fulfill the stewardship function of management by tracking financial activities, (2) to help interested users make informed decisions, and (3) to support daily business operations. The history of accounting began around 3600 BC in ancient Mesopotamia, China, and India where clay tablets were used to record commercial transactions. In the 14th century, double-entry bookkeeping was introduced in Italy and Luca Pacioli published the first book detailing this method. Modern accounting principles and standards continued to develop throughout the industrial revolution and into the 19th and 20th centuries.

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    Chapter 1.2 Functions and History of Accounting

    Uploaded by

    Zyryx Agregado
    46 views15 pages
    Accounting has three main functions: (1) to fulfill the stewardship function of management by tracking financial activities, (2) to help interested users make informed decisions, and (3) to support daily business operations. The history of accounting began around 3600 BC in ancient Mesopotamia, China, and India where clay tablets were used to record commercial transactions. In the 14th century, double-entry bookkeeping was introduced in Italy and Luca Pacioli published the first book detailing this method. Modern accounting principles and standards continued to develop throughout the industrial revolution and into the 19th and 20th centuries.

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    Accounting has three main functions: (1) to fulfill the stewardship function of management by tracking financial activities, (2) to help interested users make informed decisions, and (3) to support daily business operations. The history of accounting began around 3600 BC in ancient Mesopotamia, China, and India where clay tablets were used to record commercial transactions. In the 14th century, double-entry bookkeeping was introduced in Italy and Luca Pacioli published the first book detailing this method. Modern accounting principles and standards continued to develop throughout the industrial revolution and into the 19th and 20th centuries.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    46 views15 pages

    Chapter 1.2 Functions and History of Accounting

    Uploaded by

    Zyryx Agregado
    Accounting has three main functions: (1) to fulfill the stewardship function of management by tracking financial activities, (2) to help interested users make informed decisions, and (3) to support daily business operations. The history of accounting began around 3600 BC in ancient Mesopotamia, China, and India where clay tablets were used to record commercial transactions. In the 14th century, double-entry bookkeeping was introduced in Italy and Luca Pacioli published the first book detailing this method. Modern accounting principles and standards continued to develop throughout the industrial revolution and into the 19th and 20th centuries.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 15

    Functions and

    History of
    Accounting
    Objectives:

    ❖Explain the functions of


    accounting in business;
    ❖ Narrate the history or
    origin of accounting.
    FUNCTIONS OF ACCOUNTING

    1.To fulfill the


    stewardship function
    of the management
    (owners).
    2. To help interested
    users come up with
    informed decisions.
    3. To support daily
    operations of the
    business.
    1. The Cradle of Civilization
    Around 3600 B.C., record-keeping
    was already common from
    Mesopotamia, China and India to
    Central and South America. The oldest
    evidence of this practice was the “clay
    tablet” of Mesopotamia which dealt
    with commercial transactions at the
    time such as listing of accounts
    receivable and accounts payable.
    2. 14th Century - Double-Entry
    Bookkeeping
    The most important event in
    accounting history is generally
    considered to be the dissemination of
    double entry bookkeeping by Luca
    Pacioli (‘The Father of Accounting’) in
    14th century Italy.
    The Italians of the 14th to 16th
    centuries are widely acknowledged
    as the fathers of modern
    accounting and were the first to
    commonly use Arabic numerals,
    rather than Roman, for tracking
    business accounts.
    Luca Pacioli wrote Summa de
    Arithmetica, the first book
    published that contained a detailed
    chapter on double-entry
    bookkeeping.
    3. French Revolution (1700s)

    The thorough study of


    accounting and
    development of accounting
    theory began during this
    period.
    4. The Industrial Revolution (1760-
    1830)
    Mass production and the
    great importance of fixed
    assets were given attention
    during this period.
    5. 19th Century – The Beginnings of
    Modern Accounting in Europe and
    America
    The modern, formal accounting
    profession emerged in Scotland in
    1854 when Queen Victoria granted a
    Royal Charter to the Institute of
    Accountants in Glasgow, creating the
    profession of the Chartered
    Accountant (CA).
    6. The Present - The Development of
    Modern Accounting Standards and
    Commerce
    The accounting profession in the
    20th century developed around state
    requirements for financial statement
    audits. Beyond the industry's self-
    regulation, the government also sets
    accounting standards, through laws and
    agencies such as the Securities and
    Exchange Commission (SEC).

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