Explaining the origin and foundations of accounting is to search through history for research methods within the accounting technique, since it is shown that contrary to other sciences, accounting was born as a social need to measure economic reality and not as an approach to systematic study of knowledge.
History does not require an exact date for the emergence of accounting, it simply gives an approximation and evidence that it has its origins in the appearance of commerce. In business and social organization, where as commercial transactions increased the inability of human memory to record them, a methodology emerged to capture these activities.
Accounting evolution:
A. Ancient age
This dates back to the year… 416 where there was more accounting to do than a practice, since it only referred to the need for information that merchants of the time needed. The invention of writing and numbers generate, albeit in a very simple and rudimentary way, the fundamental elements of what is now known as an "account", where there was a title, quantities and totals.
This is the basis for the formulation of an initial accounting paradigm, in which practice is the basis. After establishing the "account" as the main accounting manager, the need to exercise accounting control was created, since it was necessary to verify the veracity of the information. From this moment on, you can speak of accounting science as a structured study object.
B. Schools of Practice
This includes the period from 470 to 1458, from this moment it is passed from profession to profession, there is talk of the use of linked books, norms, this creates a new meaning, since accounting practices are improved, historical development leads to the double entry. It should also be borne in mind that several schools are born that research and contribute to accounting development, which sought to improve practice and provide useful information, but left aside the formulation of an accounting theory that would inform their progress.
Defining:
Accounting must allow knowing at any time where the company is and where it is going, giving clear and precise reports on its economic situation, thus it is a powerful means of management and the main administrative instrument of financial planning and control.
C. Principles of theorizing:
Since 1458, with the invention of the printing press, a shift has been made in accounting practice, since concepts and procedures of some authors begin to spread, which in a certain way initiate a process of theorizing.
D. XIX century and first years of the XX century:
At the end of the XIX century and beginning of the XX where the first associations of accountants who seek to guide accounting under general standards and rules are announced. The emergence of accounting researchers in search of a theory, does not have unanimous results, but on the contrary, different and varied points are presented regarding what accounting practice should be, among the most important are:
Personification theory:
It consists of seeing in the account a fictitious person who receives and delivers. It was created because not all people could be responsible for the existing values in an organization. This theory dealt only with the account and explaining it, but it left the economic environment aside.
Its main contributions were that it served as the basis for constructing the companies' chart of accounts, the improvement of the double-entry operating method arises, and there was talk of a comprehensive accounting system.
Legal theory:
This theory attaches great importance to the company as a subject of law and its study is based on the legal implications that may arise from the accounting practice and profession.
This theory gave rise to international standardization and contributed to understanding and legislating the legal obligations that the organization has with its owners, with the state and society.
Economic theory:
The representatives of this theory consider that the accounting practice should be subject to the economic moment and the changes that take place in it. This theory advanced in the concept of value due to the Marxist theory, a concept that became one of the measurement systems of the economic reality of the company.
Pure accounting theory:
Its purpose was experimental research, taking into account the fundamental data from which the balance sheet accounts started, and not the opposite, and it discovers the system that allows reporting information on the assets of people in organizations.
Administrative theory
This theory integrates human values with the financial values of the company, considers accounting as the main administrative and financial instrument.
It also recognizes the predictive nature of accounting and the importance to the development of an organization.
The effort of theorizing and changes in accounting thinking have brought to practice a development and knowledge that have unified accounting.
Information:
The importance that the informative task of accounting has reached has made it become more important every day in the organization and that it improves its techniques and objectives in terms of issuing them.
Schools of accounting thought
A. School of realized liquid profit
This tries to find an accounting system in order to value the economic resources of the company, using some of the methods presented below:
- Replacement cost. Sale price. Current value.
Some authors such as Patón and Littleton defend the historical cost as a good valuation method, while others give greater importance to the adjustment of the financial statements, in order to reflect the reality regarding inflation.
B. School of information for decision-making
Take accounting not as a discipline, but as an accounting practice, as a source of information for a number of studies that the user depending on their situation needs, as long as all this information retains some mandatory characteristics such as:
- Relevance Verifiability Quantifiability Comparability Comprehensibility Validity Neutrality Accuracy
This information should be useful for prediction and subsequent analysis, in order to allow the user to reach a good decision.
C. School of ethics:
This stream is based on basic concepts related to the people who issue the information, mainly referring to the adequate presentation of the financial statements. It emphasizes issues such as morality in the exercise of the profession, truth and clarity, thus wanting to demonstrate the impartiality that must exist in the information provided.
D. Sociological school:
He attaches great importance to the social relations derived from accounting information, he also speaks of social accounting at the macro level; in other words, the impact of companies on the economic and social environment at the national and international level.
E. Inductive and deductive school:
It is basically focused on the elaboration of accounting theories through two processes:
Deductive process:
- Formulation of objectives (Financial statements) Statement of accounting principles (Of the social environment) Definition of methodology Definition of a frame of reference for the proposal of ideas Use of defined terms Statement of general principles for the application of what to do operational
Inductive process:
- Common features of each accounting system Coding of rules
Accounting conceptualization
After having clear the main concepts in the evolutionary system and in the schools of accounting thought, it is intended to arrive at a conceptualization of accounting, taking into account that this concept is very ambiguous thanks to the variety of ideas that one has about this concept., which has gone from being a simple practice to being a science.
In order to know the progress of the current accounting concept, different definitions that have been produced in this field through centuries have been presented. These are:
Accounting:
- Kenboecks-Rekeninge (1543): Very noble art and science of keeping books and keeping accounts Charles Penguiaio: Accounting is a symbolic mathematical expression that tops the legal construction Pierre Gamier: Accounting is the algebra of law Fabio Besta: Accounting is a science of economic control. Economic theory (19th and 20th centuries): Accounting as a method of economic observation evolves simultaneously with the medium where it is practiced that justifies its raison d'etre "The organization" It is a manual profession that registers in the accounts the transactions carried out by the merchants and tries to preserve a historical occurrence of the economic events that have occurred in the organizations.It is a dynamic activity that must progress in the same way that the operations of companies grow and become more complicated and the information needs that man requires. Accounting is a method of economic information whose essential objective is to measure the financial status of a company. organization.
Towards a new accounting doctrine
The lack of accounting methodologies can be attributed to the same accounting evolution, that is, first the technique was developed and until now a concern has been created to theorize, this very slow process of changing from a practical activity to a theoretical activity indicates that it is necessary deepen the search for an "accounting methodology".
A consistent and applicable accounting methodology would lessen the contrast between the theoretical level and practical consistency, as well as assist in the construction of generally accepted accounting principles.
Over time, various methodological instruments have been established that have generated partial theories in accounting. These theories have reached the point of distinguishing accounting as a positive science.
The aforementioned is called "New accounting", Mattessich lists certain characteristics of this:
- Formulation and use of well-defined terms and empirically significant concepts. Adaptation of general scientific instruments and methods of mathematical, philosophical and economic behavioral sciences to accounting theory. Orientation towards accounting of specific objectives and management models for specific objectives. Integration of specific accounting areas of a coherent and expanded society. Systematic verification procedures through which alternative models and hypotheses for the same objective can be verified in terms of their relevance, security, accuracy, efficiency and timeliness.
The lack of accounting methodology prevents giving an exact formulation of what this really is as a science, this does not imply that its future is not promising.
Bibliography:
- Burbano, Jorge E. «Accounting: historical analysis of its object and method. Series of administrative and financial specifications. Ballesteros, Enrique. "Theory and structure of the new accounting". Chap. 1Cañibano, Leandro. "Current theory of accounting". Caps 1 and 2
