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International Accounting Day - A serendipitous journey through our accounting history

By Dr Martin Farrar, Associate Technical Director, Research and Development –Management Accounting, Association of International Certified Professional Accountants

International Accounting Day sounds like a cynical marketing ploy cooked up by greeting card manufacturers, but its roots extend into the history of the profession. This special day celebrated annually on 10 November was initiated to remember the father of accounting, Fra Luca Bartolomeo de.

Pacioli, an Italian mathematician and friend of Leonardo da Vinci, is known for writing Summa de arithmetica, geometria, proportioni et proportionalita. First published in November 1494, the book’s title translates to ‘summary of arithmetic, geometry, proportions and proportionality’. Not exactly a snappy title by today’s standards, but don’t judge this book by its cover— it contains the first published description of the double-entry bookkeeping system.

Small wonder Pacioli inspired the annual celebration of professional accountants and all things accounting. Yet the history of our profession doesn’t start and stop in the 15th century, and International Accounting Day is the perfect opportunity to explore our intriguing past.

Accounting in the ancient world: Was ‘Kushim’ the first accountant?

Finding out who came first at anything is a tall order, but accountants make matters a little easier: They write everything down. According to historian Yuval Noah Harari, we must go back 5,000 years to discover the first recorded name of an accountant. A clay tablet dating to 3400-3000 BC, from the city of Uruk, bears the earliest message relating to our distant ancestors. The Sumerian script on the tablet includes reference to 29,086 measures, barley, 37 months, and the name ‘Kushim’. Could this be the first spreadsheet?

The inscription Kushim’ is thought to be either a generic title of office or the name of an individual, possibly an accountant. Harari concludes on ‘Kushim’ by noting, ‘It is telling that the first recorded name in history belongs to an accountant, rather than a prophet, a poet or great conqueror’. What better anecdote to celebrate on International Accounting Day or share at dinner parties when asked about your profession?

And as fascinating as the origins of accounting are, our more recent history is just as rich.

One hundred years of advocacy: CIMA from 1919 to 2019

This year’s Institute centenary gave me the opportunity to scour the archives and build a picture of how cost and management accounting has changed over the last one hundred years. It also prompted me to talk to individuals who could share their personal histories of working with the Institute.

In one such conversation with past President Ian Christison, he talked about the path to ‘Chartered Management Accountant’ status. The Institute was granted a Royal Charter in 1975, and in June 1986 we changed our name to the Chartered Institute of Management Accountants.

You might assume, as I did, that from this point on that members could refer to themselves as ‘Chartered Management Accountants’. As Ian pointed out to me, however, this was not the case.

The Institute fights for their designation

Around the time the Institute was granted its Royal Charter, other members of the Consultative Committee of Accountancy Bodies (CCAB) objected to the Privy Council over the use of ‘Chartered Management Accountant’. They argued that this description would confuse members of the public.

This led to numerous petitions to the Privy Council for a change,which resulted in many disappointed Institute Presidents. In his presidential address of June 1994, Douglas McRae commented,

‘I would, like all my most recent predecessors, very much have liked to have been able to say at the end of my term in office that this was the year in which, at last, members of our Institute were able to describe themselves as ‘Chartered Management Accountants’. Alas I, too, must join the ranks of the disappointed.’

In January 1996, the Privy Council finally granted qualified CIMA members the right to use the individual description ‘Chartered Management Accountant’. Allan McNab, CIMA President at the time,welcomed the decision:

‘We are all delighted that the Privy Council has granted us this privilege after listening to strong representations from leaders of the business world over a period of time. We pride ourselves on being active professional managers. We see this honour as recognition of the important role being played by our members in developing professional management accountancy in the business world, and our contribution to the fast-changing science of management.’

Thetwenty-one-year campaign to secure the chartered designation for our members may now be largely forgotten, but it remains an important milestone. To this day, the standing of the qualification ‘Chartered’ makes a powerful impact with our clients, peers and potential employers.

International Accounting Day has presented a great opening to look at the wider history of accounting and our particular journey of the last hundred years, and you don’t have to stop here. To learn more about the Institute’s development, from how we engage the world in the science of costing and management accounting to how our membership has evolved with the changing times and generations, download a copy of ‘Leading the Transformation: 100 Years and Beyond’.