The accountant’s job description over the centuries has focused on a series of number-crunching tasks and responsibilities. A spotlight on these reveals how the accounting profession has developed in economic history, and how accountants were part of a commercial revolution in the way they documented, interpreted and analysed financial data.

Fascinating insights can be learnt about those who have recorded and monitored financial transactions from the time of ancient civilisations to modern practice in the 21st century. Despite the accountant’s stereotypical stuffy and mundane personality, research into their ancestral roots gives an intriguing description into a profession steeped in numerical and statistical analysis.

Egypt, Babylonia & Ancient Rome

The earliest evidence of rudimentary bookkeeping and auditing can be traced as far back as ancient Mesopotamia, where Egyptian and Babylonian farmers had to keep a check on the numerical value of their crops and livestock. The aim was to find out the extent of profit and wealth in an unsophisticated and crude system of accounting.

Clay tokens were used to record information in processes that bore scant similarities to modern day practice, but which nevertheless contributed to the financial control of early farming production.

Calculations and accounting procedures in these far-off years were then used by farmers who wished to manage their finances better so as to secure greater control of their work and enterprise. Around 4000BC economic management by these ancient civilisations was made possible by an education that consisted largely of reading, writing, maths and bookkeeping. Archaeological digs in these parts of the world have revealed that in so much of the financial management of commodities such as corn and cattle, scribes would meticulously calculate the extent of the produce and stock.

Between 14BC and 63AD, the accounting mantle was taken up by the Roman Empire. The contribution made by Emperor Augustus acts as a fine example of the ways in which the Romans dealt with accounting and business. The discovery of records concerning day-to-day spending gives a highly relevant understanding of the financial transactions processed by the emperor’s accounting clerks. Their calculations related to such transactions as the buying and selling of land and the construction of buildings.

Accountants’ defining moment occurred in the 15th century when Luca Pacioli, an Italian monk, put pen to paper and wrote about accounting techniques and procedures used by accountants of his era; he referred to principles still in vogue today.

Another major inroad was perfected by Claude Irson, a mathematician who in the 1670s contributed, like Luca, to the development of accountancy in modern Britain and in Holland. In England, for instance, the English government were keen to use accounting staff for military purposes, something proposed by the Dutch and also considered by the French, German and Russian political leaders.

The Industrial Revolution and the modern era
Management accounting took on a modern form during the Industrial Revolution. Business owners increasingly recognised the importance of employing accountants to take stock of their finances. Management accountants did their best to calculate the costs of goods, manufacturing products and produce, using various methods to calculate whether production was viable or not.

Other techniques the accountant took on board were the working out of labour costs and the extent to which, for example, machinery lost its value through wear and tear, a process known in accounting terminology as depreciation. There was a need to respond to the growing demands of industry and increasingly accounting became necessary to keep a track of detailed records and to present the financial wealth of business.

Economists today see the 18th century as a period when basic bookkeeping transformed national and international accounting, which went on to affect the trade and commerce both at home and overseas. Whether it was a question of working out profits or losses, budgeting or costing expenses, the accountant’s duty was to respond to the monetary requirements of mass production and large companies.

The USA quickly turned towards accounting as a vital component to its railroad industry.

Britain was instrumental to future progress and in the 19th century, with the expansion of limited companies, the widespread demand for accountants provided a vocation to those with the technical knowhow and aptitude for figure work.

In the 19th century, progress came with a disadvantage so as well as promoting and aiding the growth of corporate Britain, a lack of integrity in company behaviour challenged the squeaky-clean image of business and financial enterprise. Fraud and corruption took hold, leading to scandal in the 1840s, and there was a call for greater regulation, especially in the area of audit. In this way, and where there was a need to eradicate or reduce foul play, the work of accountants grew. Legislation was introduced in the form of a series of Companies and Bankruptcy Acts paving the way for further work for accounting professionals.

The work of accountants increased well into the 20th century and in addition to some more of the traditional duties, consultancy and advisory services became other functions within the scope of the profession’s responsibilities.

Since World War Two, modern technology and the widespread use of accounting software have further revolutionised the part played by accountants in the work they do. Computer software such as Sage and Excel has transformed the workings and calculations of accounting to a new and sophisticated level. The modern accountants no longer have to constantly rack their brains, but instead can rely on data processing and computerised methods to carry out the more mechanical parts of their professional duties.

A Victorian accountant, with a quill pen behind his ear, studying a thick ledger with intense concentration. From The Cottager and Artisan’ for 1885