THE OLD DU PONT COMPANY'S ACCOUNTING SYSTEM LASTING A HUNDRED YEARS: AN OVERLOOKED ACCOUNTING SYSTEM

2012 ◽  
Vol 39 (1) ◽  
pp. 53-88 ◽  
Author(s):  
Daijiro Fujimura
Keyword(s):  
Nineteenth Century ◽  
Financial Accounting ◽  
Cost Data ◽  
Accounting System ◽  
System Cost ◽  
Vital Importance ◽  
Accounting History ◽  
The Cost ◽  
Double Entry ◽  
Made In

ABSTRACT Accounting historians have not yet realized that there existed another complete accounting system before the formation of the modern accounting system of today which Johnson and Kaplan's Relevance Lost characterizes by the “integration” of cost and financial accounts supported by “inventory costing.” In that earlier accounting system, cost and profit calculations were made in a past particular ledger account or accounts, namely trading account(s), where accounting practices opposed to “inventory costing” and “integration” were used. The historical existence of that accounting system is overlooked by accounting historians. The example of the old Du Pont Company (DPC) this paper presents will bring it to light. Cost and profit calculation were made in four trading accounts in the double-entry ledger at the old DPC as it was purchased by the new DPC in 1902. One of its trading accounts dated back to 1804 when the old DPC started production of gunpowder. Early cost and profit calculations in that trading account were examined by the new DPC's staff in the early 1940s. They prepared schedules showing the cost data, sales revenues, and profit measurement recorded in the early trading account. These schedules give evidence that the old DPC recorded the costs incurred and used the cost data to compute profit for financial accounting purposes, but in different ways from today's “inventory costing” and “integration.” This old DPC's accounting system resulted from the application of the double-entry system to industrial accounting and was in use throughout the nineteenth century. By revealing the historical existence of that overlooked accounting system, this paper will show that accounting history may be described as evolution of the traditional accounting system made through double-entry bookkeeping in which the trading account was of vital importance and the transition from that traditional accounting system to the modern integrated accounting system supported by inventory costing.

Accounting, greed, and beliefs in a nineteenth century communal religious society

2021 ◽  
pp. 103237322110323
Author(s):  
Tonya K Flesher ◽  
Dale L Flesher
Keyword(s):  
Nineteenth Century ◽  
Religious Organizations ◽  
Accounting System ◽  
Religious Institutions ◽  
Labor Costs ◽  
Accounting History ◽  
Spiritual Dimension ◽  
Harmony Society

The availability of the accounting and other records of a religious communal society (the Harmony Society) provides for a study that adds to the literature on accounting in religious organizations, a need highlighted in Carmona and Ezzamel’s article in Accounting History that discusses: (1) the unique spiritual dimension of religious institutions and its impact on accounting, and (2) the ‘sacred/profane divide’ (p. 122). The Harmonists’ communal beliefs were derived from Biblical interpretations and were necessitated by the need for shared labor and resources. Harmonists’ accounting records were sophisticated but did not account for labor costs provided by members. The interplay of these beliefs and the greed of the leaders impacted the group’s accounting system and created a spiritual/profane divide. The study explores the interplay between the role of accounting and the community’s beliefs and goals.

separate double-entry system. Separation of cost accounting from financial accounting was believed to be essential. The reasons that were given then for this separation seem still valid today in view of the maintenance of the same practice in the 1982 Accounting Plan. The most important justifications were the following: 1. It facilitated the establishment and further modification of the cost accounting system; 2. In cases where there were modifications in production or in the company structure, the cost accounts could be adapted without modifying the plan for financial ac­ counting, thus preserving the inter-firm comparability of the financial information, as well as its comparability over time; 3. Charges included in product prices could differ from ex­ penditures registered in financial accounting; 4. The use of contra-accounts allowed complete freedom in cost accounting; the transformation of data for the compu­ tation of product prices and the determination of results of operations could thus be done freely without altering the original accounts [CNOF, 1947, pp. 32-34, 99]. The CNOF Plan was very well designed; however, to preserve the recent tradition introduced by the 1942 Plan, only some of its features were retained in the 1947 Plan. The influence of the CNOF Plan and of the 1942 Plan on the 1947 Plan will be consid­ ered after introducing the latter. THE 1947 ACCOUNTING PLAN As the first official plan drafted after the Liberation, the 1947 Plan constituted the real beginning of accounting normalization in France. It was initially designed for industrial and commercial undertakings, but with the intention of adapting the plan to all sectors of the economy. The ultimate goal of the Committee for the Normalization of Accounting was to create a system that would allow the summation of the accounts of all economic units, thereby facilitating the preparation of national accounts. The Committee was headed by its vice-president, Turpin, who was secretary of the Central Committee for Prices. The secretary of the Committee was Pujol, a state economic expert and former secretary of the adaptation committee for the 1942 Plan. Among the sub-committees that were formed to work on specific topics, the three most important ones were the sub-committee on prin­ ciples, definitions and rules, headed by Fourastie and Lauzel; the

2014 ◽  
pp. 344-344
Keyword(s):  
Central Committee ◽  
Vice President ◽  
Cost Accounting ◽  
Financial Accounting ◽  
Economic Expert ◽  
System 2 ◽  
Cost Accounting System ◽  
The Cost ◽  
System Separation ◽  
Double Entry

scholarly journals A pioneering era of accounting history: The contributions of nineteenth-century Italian literature and its enduring dissemination around the globe

2017 ◽  
Vol 22 (2) ◽  
pp. 214-243 ◽  
Author(s):  
Stefano Coronella ◽  
Valerio Antonelli ◽  
Alessandro Lombrano
Keyword(s):  
Nineteenth Century ◽  
Italian Literature ◽  
Historical Research ◽  
Late Nineteenth Century ◽  
International Accounting ◽  
Accounting History ◽  
The World ◽  
Double Entry ◽  
Widespread Dissemination ◽  
Great Development

The aim of this article is to show the contributions to the accounting history literature made by Italian scholars working in the second half of the nineteenth century. These scholars comprised the world’s first community of academics, practitioners, office bearers and historians dealing in a systematic way with accounting’s past. They invented the narrative of accounting history and their historical re-enactments on relevant topics have been the basis for further historical research for many years. The last decades of the nineteenth century saw great development in historical studies of accounting, both in and outside of the academies. These studies were mainly of three types: (a) general histories, which examined the evolution of accounting practices from antiquity to the late nineteenth century; (b) investigations of the origins of double-entry and Pacioli; and (c) research on the evolution of accounting practices. Some of the most prominent books and papers published in this period have become widely known abroad. This article contributes to knowledge of early international accounting historians and can be linked to the field of accounting history today. It also demonstrates the widespread dissemination of this early Italian literature around the world, thereby forming the first example of international accounting history.

scholarly journals The earlier synthetic balance sheet of Datini's Company in Avignon (1410): The combined accounting system

2020 ◽  
Vol 17 (1) ◽  
pp. 7
Author(s):  
Mikhail Kuter ◽  
Marina Gurskaya ◽  
Dmitriy Aleinikov
Keyword(s):  
Balance Sheet ◽  
Accounting System ◽  
Archival Material ◽  
Accounting Practice ◽  
Accounting History ◽  
Detailed Explanation ◽  
Double Entry ◽  
Financial Result ◽  
Operating Result

When studying accounting history, the use of archival sources is very important. Unfortunately, when scholars explore the genesis of accounting practice, archival sources are not often used. This paper does so, presenting a detailed explanation of features of the accounting system used by Francesco di Marco Datini’s’ company in Avignon 14091410. This accounting system used stocktaking and double entry in order to determination of the operating result and produce an analytical balance sheet. This study analyzed the Quaderno di Ragionamento (the book for drawing-up final accounts, including the financial result) with the aim of clarifying the features of this process. It also investigated the procedure used in preparing the synthetic balance sheet, a process not known previously elsewhere. This research was based on the archival material comprising of account books of the medieval merchant company of Datini, preserved in the State Archive in Prato.

of the information given to the shareholders, precautions to take for upward appraisal of capital assets, choice of an investment, and dividend policy. In order to raise enough capital for its business, the Company had to inform a growing number of shareholders, which soon became inconsistent with the managers’ freedom to deal with ac­ counting information according to their own needs. The resoultion of this problem led to the distinction between standard­ ized financial accounting for external and management account­ ing for internal use. As it became more and more efficient and advanced, the accounting system led to its own splitting. CONCLUSION Compared to most of the firms, Saint-Gobain had to face very early (in the first half of the 19th century) the problems raised by the setting up of a management accounting system. However, it was not until 1820, 155 years after its creation, that it adopted double entry bookkeeping which included the calculation of costs. This evolution is mainly due to the spreading of the Industrial Revolution in France, which was responsible for the abolition of privileges and the growth of competition in the field of glass pro­ duction. During the period 1820-1880, the cost accounting system had been gradually improved, without any regular outside coercion, according to the needs of the management alone. This leads to two conclusions and two research questions. In 1880, the accounting system facilitated the reckoning of full costs with methods and procedures that are still in use (alloca­ tion of the overhead with the use of activity center accounts, up-to-date transfer pricing methods, analysis of the relationship be­ tween depreciation, dividends and investments, etc ). This full cost method is now over one hundred years old. The development and the mastering of that cost accounting system were absolutely necessary to start the next stage, that is to say the use of those costs to prepare estimates of costs and investments. That stage took place over four decades (1890 to 1930) and led to real budget control towards the end of the Second World War. It should be recognized that the accounting systems of a given period can be very different from one another, which is particu­ larly true in the 19th century, therefore research should look at the variables on which the accounting system of each firm depends. Among the internal ones, the size of the firm, the culture of its

2014 ◽  
pp. 267-267
Keyword(s):  
19Th Century ◽  
Industrial Revolution ◽  
Transfer Pricing ◽  
Cost Accounting ◽  
Accounting System ◽  
Accounting Systems ◽  
Cost Accounting System ◽  
The Cost ◽  
Double Entry ◽  
The 19Th Century

The Effect of Different Groupings of Building Elements on Cost Significant Elements and their Cost Contributions to the Total Building Cost of a Block of Medium Cost Apartments in Malaysia

2013 ◽  
Vol 405-408 ◽  
pp. 3335-3339
Author(s):  
Cheng Sim Lim ◽  
Tien Choon Toh ◽  
Wah Peng Lee ◽  
See Seng Ng ◽  
Chin Khian Yong ◽  
...  
Keyword(s):  
Pilot Study ◽  
Cost Analysis ◽  
Cost Data ◽  
Total Cost ◽  
Building Cost ◽  
Medium Cost ◽  
The Cost ◽  
Made In ◽  
Building Elements

Utilising cost data from a block of medium cost apartments in Sungai Buloh, Malaysia, this pilot study aims to evaluate the cost significant elements (CSE) and their cost contributions (in percentages) to the total building cost (TBC) determined based on the grouping of building elements according to the original bills of quantities (BQ) format and the grouping of building elements according to The Institution of Surveyors, Malaysia (ISM)’s elemental cost analysis (ECA) format. Two separate tabulations following the same steps are made in order to achieve the objective of the study. Each tabulation has information on the total cost of each element, and produces information on ‘Actual Total Bill Value’, ‘Mean Bill Value’, ‘Total Bill Value of CSE’, ‘Number of Total Elements (TE)’, ‘Number of CSE in Total’, ‘CSE/TE (per cent)’, and lastly ‘Total Bill Value of CSE/Actual Total Bill Value’. For both tabulations, it is found that “45.45% to 50.00%” of the total number of building elements has contributed to “78.11% to 83.77%” of the TBC and that the two different groupings of building elements being studied have yielded quite similar results. Nonetheless, further analysis can be done with more data from other similar buildings in the region to obtain statistically reliable results.

FREDERICK WINSLOW TAYLOR'S CONTRIBUTIONS TO COST ACCOUNTING

1980 ◽  
Vol 7 (2) ◽  
pp. 1-22
Author(s):  
Rosita S. Chen ◽  
Sheng-Der Pan
Keyword(s):  
Comparative Analysis ◽  
Cost Accounting ◽  
Accounting System ◽  
Managerial Accounting ◽  
Manufacturing Company ◽  
Cost Accounting System ◽  
The Cost ◽  
Made In ◽  
The Way

This article is to introduce the cost accounting system that Frederick Winslow Taylor installed at the Tabor Manufacturing Company sometime in the 1890s. A comparative analysis between this system and Captain Henry Metcalfe's Cost of Manufactures is also made in order to investigate their sources and influences. It is concluded that Taylor was a pioneer in many aspects of cost accounting, but his most important contribution was the development of the managerial approach that paved the way for modern managerial accounting.

Research and Application on the Urban Public Transport Route Accounting System

2012 ◽  
Vol 178-181 ◽  
pp. 1709-1714
Author(s):  
Zhi Ke Han ◽  
Quan Pan ◽  
Bo Wen Yang
Keyword(s):  
Real Time ◽  
Financial Accounting ◽  
Accounting System ◽  
Commercial Vehicles ◽  
Time Data ◽  
Financial Condition ◽  
Accounting Principles ◽  
Accounting Unit ◽  
Urban Public Transport ◽  
Double Entry

Bus route accounting system with basic accounting methods and financial accounting principles of double-entry bookkeeping, the use of passenger daily, real-time billing, supplies, human resources systems to provide real-time data to a single line of commercial vehicles and accounting unit of revenue, costs , costs of collection, and ultimately accurate reflection of Busroutes, the fleet of the company's production operations financial condition.

scholarly journals The Double-entry Bookkeeping Committee of 1914 and the Brazilian Public Accounting System

2014 ◽  
Vol 25 (spe) ◽  
pp. 321-333
Author(s):  
Tiago Villac Adde ◽  
Sérgio de Iudícibus ◽  
Álvaro Augusto Ricardino Filho ◽  
Eliseu Martins
Keyword(s):  
Financial Accounting ◽  
Accounting System ◽  
Public Accounting ◽  
Colonial Era ◽  
Creditor Bank ◽  
History Of ◽  
The Creation ◽  
The Republic ◽  
The Government ◽  
Double Entry

The history of Brazilian accounting has not been explored at length. Through a historical survey, this article presents the history of the Double-entry Bookkeeping Committee of 1914. After the Proclamation of the Republic was announced in 1889, the government started to expand its administrative bodies, necessitating the introduction of a bureaucracy able to perform new functions. In the same period, Brazil experienced a strong economic development with the development of its coffee industry. In 1905, under the leadership of Carlos de Carvalho, São Paulo State Treasury bookkeeping tasks were introduced under a double-entry bookkeeping system and through accrual and financial accounting. Double-entry bookkeeping practices in the federal public accounting system, although enshrined in law since 1808, were only fully realized after the creation of the Double-entry Bookkeeping Committee in 1914. In that same year, due to the negotiation of a second funding loan, English creditor bank auditors requested a balance of the National Treasury from the Minister of Finance Rivadávia Corrêa. Because the balance had not been prepared in eight years, the Double-entry Bookkeeping Committee was established in June of 1914, and this body completed a technical audit of Revenues and Expenditures. The committee also conducted the state administration's first Asset and Liability audit since the colonial era. The Double-entry Bookkeeping Committee of 1914 spearheaded changes to the Brazilian public accounting system, including the creation of the Public Accounting Code in 1922 and the approval of Central Accounting Office of the Republic regulation in 1924, strengthening and ascribing perpetuity to practices adopted after 1914.

scholarly journals APPLICATION OF TAX PRIORITIES IN MANAGEMENT ACCOUNTING

2021 ◽  
Author(s):  
Nataliia Havrilenko ◽  
◽  
Olena Hryshchenko ◽  
Natalia Kozitskaya ◽  
◽  
...  
Keyword(s):  
Management Accounting ◽  
Financial Accounting ◽  
Tax Burden ◽  
Accounting System ◽  
Tax Expenditures ◽  
Accounting Data ◽  
Tax Cost ◽  
Tax Payments ◽  
Double Entry ◽  
Tax Costs

In the process of studying the methodological approaches used in assessing the tax burden, it was concluded that it is advisable to use a comprehensive assessment of tax costs in their relationship with tax-dependent places of expenditure, cost centers and responsibilities that cause tax liabilities, and this allows us to expand the cognitive value of the analysis of the profitability of different species. The lack of direct interdependence of the tax burden of enterprises as economic entities with the objects of management accounting in the accounting system leads to the inability to analyze the level and optimize the amount of tax expenditures. In this regard, the identification and justification of the principles of selection in the management accounting of objects of responsibility for tax costs that arise, allows to increase the informativeness of management accounting for these costs and establish the relationship between specific taxes and centers of responsibility for tax base formation. The article highlights the peculiarities of the formation of information on tax expenditures, which make it possible to model the accounting mechanism for the tax burden in the management accounting system. Selected accounting and analytical indicators that directly or indirectly affect the amount of tax payments and are interrelated with the functional responsibility of managers at different levels. The peculiarities of the distribution of tax expenses between the objects of management accounting are revealed, in which each of the objects of management is the object of accounting and assumes part of the tax cost. A typical mechanism for obtaining accounting data for managing tax expenditures from financial accounting data using accounting methods is considered. The study of management accounting methods in relation to the tax burden of the enterprise has influenced the search for new forms of evaluation of the results of accounting for tax expenditures in order to apply them in the analysis of tax costs. The existence of interrelation between accounting entries, which reflect the accrual of taxes in financial accounting, with the analytical features of management tax accounting. As a result of the use of accounts and double entry, the information resource obtained on the basis of primary documents is sent to an independent system of administrative accounts.

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