History of Double Entry Bookkeeping

Background of pacioli

• Born in 1445 in Borgo San Sepolcro, Tuscany

• Student under the guidance of Piero della Francesca

• Given the opportunity to gain accessed to the library of Duke Federigo of Urbino (Stakhov, 2009, p.47)

• Travelled to Venice where he took a job on tutoring in the year 1464 (Rabinowitz, 2009, p.12)

• Published Europe’s first ever mathematical Encyclopedia (Ovunda, 2015, p.132)

Background of Cotrugli

• born in 1416 in Ragusan of the Republic of Ragusan, modernly, Dubruvnik of Croatian (World Heritage Encyclopedia, n.d.)

Summa de Arithmetica, Geometria, Proportioni et Proportionalita

• moved to reside in the Kingdom of Naples (Northern Italy) where he started developing his ideas further (Accounts Man, n.d.)

What is D.E.B ?

The Spreading of the Application of Double Entry Bookkeeping

• Printed books play an important role in the diffusion process of the DEB

• first person to put D.E.B practice on paper on his manuscript named Della Mercatura et del Mercante Perfetto (Chatfield and Vangermeersch, 1996)

Luca Pacioli ( Father of accounitng)

• Invention of the movable technique of printing by a German goldsmith named Johannes Gutenberg (Flower, 2004, p.227)

• Allowed Pacioli to easily reproduce his book in a larger quantity - easy access of book throughout Europe

• The original Italian version of the Summa was further developed through various language translations of the book (Ott, 2012, p. 95)

A systematic method of recording business transactions

(Rahamon, 2014, p.2)

• Many writers also published their book while outlining the theory introduced by Pacioli (Taylor cited in Edwards, 2013, p. 67)

Everything about Arithmetic, Geometry, Proportions and Proportionality

• Contributed to modern science and also to bookkeeping (White, 2012, p.113)

• Section entitled De Contutis e Scripturis, a treatise which discussed about DEB (Montebelli, 2015, p.135)

• 'if the debits is not equivalent to the credits, a person should not go to sleep' (Investopedia, n.d.)

Benedetto Cotrugli

• Widely believed to be the forerunner of modern bookkeeping practice (Macve cited in Sangster, Stoner and McCarthy, 2008, p.112)

(benedikt kotruljevic)

• First paper published edition on the methods of performing bookkeeping (Ovunda, 2015, p. 133)

However, the use of this system was still limited throughout the many business firms.

Della Mercatura et del Mercante Perfetto

It was only until the 19th century where the practice of this system was widely adopted in the business world and consequently started dominating the accounting education and practice

• Every transaction is recorded twice

(Ott, 2012, p. 95)

• The slogan ‘for every debit there is a corresponding credit'

(Edward, 2013, p.56)

Facts about

della mercatura et del mercante perfecto

• 'debita'-owed to the proprietor

• A manuscript that documents a set of rules for keeping business records that are still use till this day. (Willcox, 2013)

• Unfortunately, was not published until the year 1573 (Rutledge, 2015)

• 'credo'-owed by the proprietor (Sia Integral Plus, n.d.)

• First publication - a Croatian scholar named Franciscus Patricius in Venice

• In 1613 - a French version was published under the name 'Parfait Negociant' in Lyon (Zubrinic, n.d.)

According to Author Cayley (cited in Ellerman, 1985, p.227), a 19th century Mathematician, the DEB system was in fact like Euclid’s theory of ratio an absolutely perfect one.

The basic elements of the DEB system has remained unchanged since the first publication of Pacioli’s book. (Rabinowitz, 2009, p.13)

The Emergence of D.E.B.

• In 1211 - through a Florentine banker’s ledger fragments of his account book (Sangster, n.d.)

• In 1340 - a Messari’s, the Italian term for treasurer’s, account book from the city of Genoa (Iticale, n.d.)

Conclusion

Questions & Answers Session

History of Double Entry Bookkeeping

a.k.a D.E.B.