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Accounting
History
Accounting
history, very early:
- Accounting has been around since man started to
trade, thousands of
years B.C. Accurate records were even a necessity then for
those
that were involved in trading.
Double
entry accounting invented:
- The double
entry type accounting that is used today was believed to have
been invented in Italy during the late 1400's.
Recent
history:
- In relatively recent history, the profession
has been guided by generally
accepted accounting principles (GAAP). These
principles are intended to be the standards for the profession, which
all Accountants must comply with.
- The two organizations that are
responsible for creating new principles (GAAP), are:
- The Financial Accounting Standards Board
(FASB)
- The Securities and Exchange Commission (SEC)
Scandals
create new regulations:
- Throughout history, scandals have created new
rules and regulations.
- Recently, the scandals of companies such as
Enron, Tyco and Worldcom, have been the cause of new regulations.
- These scandals cost many investors their life
savings, and
many employees their jobs. This was due to improper and
fabricated accounting.
- The Sarbanes-Oxly (SOX) is the resulting
regulation.
- This regulation has been very burdensome and
costly for many corporations, but is an attempt to force accurate
reporting.
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