Accountants who made their mark on history
Eleanor O'Neill takes a look at some of the accountants who made history and helped shape the world we know today.
Pre-15th Century: The Firsts
The first accountants in history are thought to have come from ancient Mesopotamia.
They worked for the temples, keeping track of taxes paid in sheep and agricultural produce for the religious authorities of the day. This was a standard practice in several ancient cultures as it meant the upkeep of places of worship was paid for by the labours of the congregation, rather than the spiritual leaders.
In the process, many historians believe they invented the practice of writing in order to keep receipts. Prior to this development in record keeping, token systems were often used to document the exchange of goods and services.
15th Century: Luca Pacioli
What we recognise today as double entry bookkeeping originated in late-Medieval Italy.
It was first recorded by a Franciscan friar and mathematician named Luca Pacioli in 1494. He advocated the use of ledgers and is known for saying a person should not go to sleep at night until their debits and credits are equal.
His book, Summa de arithmetica, geometria. Proportioni et proportionalita, described keeping accounts for assets, liabilities, capital, income, and expenses, much like the systems we use today in balance sheets and income statements.
As such, Luca is known as the 'Father of Accounting'.
17th Century: Robert Colinson and Thomas Stevens
Subsequent publications of accounting volumes continued through the 1500s and 1600s. One notable work was penned in 1683 by Robert Colinson.
Idea Rationaria was the first such book to be published in Scotland and is among the papers included in the ICAS Antiquarian Collection, currently housed at the National Library of Scotland.
In the following century, the most highly regarded English-written publications on bookkeeping were published in Scotland or had Scottish authors, marking the period known as the 'Scottish Enlightenment' where the arts and sciences enjoyed a meteoric rise.
It is also believed that the first company accountant rose from this era.
Thomas Stevens was Accountant General of the East India Trading Company, in many ways the first modern, shares based, limited liability company. Unfortunately, not much is known abut Thomas as records are sparse before 1657.
18th Century: Josiah Wedgwood
Though better known for his pottery and ceramics business, Josiah Wedgwood is also considered the first cost accountant.
During a slump in business in 1772, Josiah began to make a concentrated effort to establish the profit or loss realised each time a particular product was sold from his factory. He recognised the sense in recording not just the cost of materials and labour but calculations for coal, storage and transport.
Incidentally, his studious habits led to the discovery that his head clerk had been embezzling funds.
19th Century: William Welch Deloitte and the first ICAS Presidents
In 1831, accountants received their first public recognition with the passing of a Bankruptcy Act that named them alongside merchants and bankers as sufficiently qualified to conduct audits.
The first of the Big Four accountancy firms was founded in 1845 by William Welch Deloitte at the tender age of 25. Though it has gone through many mergers and restructures, the firm still bears his name today.
James Brown was the first President of the Society of Accountants in Edinburgh (SAE), which was formed in 1853. He was noted in A History of Accounting and Accountants (AHAA) to be "a big, buirdly man, and conducted a very large business with great energy and success. He was frank and pleasant in manner, and upright and honourable in all his dealings."
James McClelland was his counterpart at the Institute of Accountants and Actuaries in Glasgow (IAAG) and for many years was considered facile princeps, the head of his profession. He is also well known for his part in establishing the Glasgow Sunday Educational Association and the Glasgow Secular School Society.
John Smith was named the first President of the Society of Accountants in Aberdeen (SAA), established by James Meston and William Milne in 1866. Records show "his character commanded universal respect, and his business qualifications secured for him the implicit confidence of his many clients, to whose interests he devoted the closest attention" (AHAA).
These three institutes would eventually combine to form ICAS as we know it today.
20th Century: Isobel Guthrie, Frank J. Wilson, Itzahk Stern, Robert Gordon Smith and Primrose Scott
The first woman to be admitted to one of the accountants' societies was Isobel Guthrie CA, who tested into the IAAG in 1923. She was an apprentice at Bannatyne & Guthrie, her father's firm, and originally applied to the IAAG in 1915. It wasn't until after the passing of the Sex Discrimination (Removal) Bill that she was successful.
Forensic accountancy finds its first publicised example in Frank J. Wilson, the accountant embroiled in the case of Al Capone's conviction in 1931 Chicago.
With efforts to shut down the infamous gangster's illegal alcohol business proving unsuccessful, the US Treasury Department's Special Intelligence Unit appointed Frank to investigate Capone's taxes. His subsequent discovery of massive income tax avoidance led to a sentence of 11 years in prison, during which Capone died.
Historians have remarked on the role of accountants in World War II, particularly as auditors of the Nazi concentration camps.
However, the most famous accountant of the war is perhaps Itzahk Stern, bookkeeper and friend to Oskar Schindler. He is credited with typing the list of names known as 'Schindler's list', a number of Jews who survived the Holocaust because of their employment under Schindler.
Itzhak forged documents to classify otherwise 'nonessential' Jewish workers as experienced machinists and factory operators in order to protect them from execution. Around 1100 Jews were saved in this way by the end of the war.
Robert Gordon Simpson CA was named as the first president of ICAS in 1951. The first female President, Primrose Scott CA, was appointed in 1994.
21st Century: Professor Sir David Tweedie and Olivia Kirtley
The establishment of the International Accounting Standards Board (IASB) in 2001 was the first serious move in enforcing a level of quality in the accountancy profession worldwide.
Professor Sir David Tweedie CA, as Chairman of IASB from its inception until 2011, led the revitalisation of international accounting standards and can easily be considered the foremost advocate for the global adoption of transparency, accountability and efficiency in accounting.
He was inducted into the Accounting Hall of Fame at Ohio State University in 2013.
Sir David was also President of ICAS (2012-13) and chaired the Trustees of the ICAS Foundation. Under his leadership, academically talented young people from disadvantaged communities were able to take their first steps into a professional career in accountancy or finance. This is a legacy that continues today.
Olivia Kirtley CPA was named by the National Association of Corporate Directors (NACD) as one of the top governance professionals in the US and is a highly respected advocate for global corporate transparency.
She served on the International Federation of Accountants (IFAC) Task Force on Rebuilding Public Confidence in Financial Reporting, following the Enron and WorldCom scandals in 2002/3.
Olivia was made President of IFAC in 2014 and continues to promote good professional practice around the world.
She is also known for leading the update and computerisation of the Uniform CPA Examination in the early 2000s.
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