A Brief History of Accounting: From Ancient Civilizations to Modern Times, Study notes of Mathematics

Download A Brief History of Accounting: From Ancient Civilizations to Modern Times and more Study notes Mathematics in PDF only on Docsity! Accounting Reviewer Chapter 1: Introduction To Accounting History of Accounting  Accounting practice dated back to the history of mankind Practice of Accounting: Early Civilization  Record keeping was already common during the CRADLE CIVILIZATION in countries like CHINA, INDIA or Mesopotamia  Trades goods in exchange for something valuable  Early accounting involves writing, counting and money exchanges The Founder of Double - Entry Accounting System and the Father of Accounting  Revolutionized accounting  Invented by Benedetto Cortugli in 1458  Bookkeeping system (involves two accounts in recording transactions: one is a debit and the other is credit)  Luca Pacioli (Father of accounting and bookkeeping) wrote Summa de Arithmetica, Geometry, Proportioni et Proportionalita (1494) The Beginning of Modern Accounting  Professional organizations for accountants were first established in Scotland in 1854.  Edinburgh Society of Accountants  Glasgow Institute of Accountants and Actuaries.  Both were granted a royal charter by Queen Victoria  Chartered Accountants  American Institute of Certified Public Accountants in 1887 The Present Time  20th century branched into different professional expertise in the field of accounting  What is accounting?  Art – part of our knowledge that helps us attain our objectives, design and processes and policies  Recording – of transactions in various ways, according to the accounting standards and as required according to the size of the organization  The art of classifying – which is the grouping of transactions, because an organization has to prepare the financial statements.  The art of summarizing – Businesses transactions, because an organization has to prepare the financial statements  Summarizing in a significant manner – summarizing must be done a way wherein there is sense of importance and must suit the purpose for which it is done. Should be user friendly  In terms of money – money is the measure and basis in recording transactions  Transactions and events which are, in part at least of financial character – Accounting deals with financial