Evolution of accounting thought
A brief history of accounting
The risk of this type of investing made it an activity for the wealthy—a rich man's sport with the taint of gambling. In fact, during this period very little change took place in this world and the same is true in case of economic development. With the importance of record keeping being recognized, the Mesopotamians developed Cuneiform, the first recognized form of writing.. Introduction of going concern concept With the expansion of trade and commerce the going concern concept in place of short-term concept was introduced in many countries of the world and in the light of this concept revenue and capital nature of accounts was identified. This committee has formulated forty-one accounting standards so far and its efforts are in progress. The gradual evolution of accounting through these four stages is discussed below in brief; Stone Age When people did not know how to build a house, they used to live in caves, mountains, and jungles and earned their livelihood by collecting fruits and hunting animals. The American Institute of Certified Public Accountants published an accounting principle in and the American Accounting Association AAA published a statement of another accounting principle of same nature in
The concepts and principles of accounting were influenced to a great extent by these conditions. This book is divided into five chapters.
The financial statements of an organization are to be prepared in accordance with the accounting principles so that this exhibit a true and fair picture of the organization. Mechanized Accounting and Auditing Mechanized Accounting system has been introduced as a result of technological advancement.
The creation of professional accountants came at an opportune time.
This research work was considered the birthplace of accounting development. Nature and natural things like animals, bird, trees, fruits leaves etc. The businesses in question were small enough that the owners were personally involved and aware of the health of their companies.
InI was introduced to the world of business math which is just a simplified basic accounting. These-professional institutes helped in the development of accounting thoughts and practices, e.
4 major events in the history of accounting
Before the industrial revolution depreciation and costing, concepts were not considered very much important. Though it was just a school year of taking the class it left a lasting imprint in my life. In the middle age economic development helped the development of Accounting to a great extent. There were no financials to check if you wanted to invest in a corporation or business that you knew nothing about. Immense advancement was made in industry and commerce and these influenced the economic and social life tremendously. To get goods and people to their destinations, you need distribution networks , shipping schedules, fare collection, competitive rates, and some way to evaluate whether all of this is being done in the most efficient way possible. In fact, during this period very little change took place in this world and the same is true in case of economic development. According to Glautior and under down, in the age of feudalism, a supervisory accounting system was in practice. Subsequently, this book was translated and published in Scottish, German, French, Russian and English. These systems of accounting are important for both taxpayers and receivers. These-professional institutes helped in the development of accounting thoughts and practices, e. Charles Darwin formulated this theory that has stood the test of time. As a result, the concept of periodic accounting was introduced. This was considered to be a further step towards the development of the accounting process.
The First Financials Eager to attract more capital to expand their operations, corporations began to publish their financials in the form of a balance sheet, income statementand cash flow statement.
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