Luca Pacioli – the Father of Bookkeeping. Unless he’s not.

Luca Pacioli was an Italian mathematician, teacher & Franciscan Friar back in the 15th & 16th Centuries. He was also pals with none other than Leonardo DaVinci, with whom he taught mathematics to. He & DaVinci collaborated on a treatise on geometry, for which the artist contributed the illustrations. But is he the true father of bookkeeping & accounting? There is some doubt, but we’ll get to that later.


Medieval & Renaissance Italy fared prominently in the history of the development of bookkeeping, but the practice dates back much further – over 7000 years, in fact, going all the way back to ancient Mesopotamia. The need for bookkeeping, & its development, corresponds with the rise of trade, taxation, & economic growth.  Lists have been found that detail expenditures, goods received and traded from all these cultures & illustrate that, even way back then, people were thinking about numbers.  Between the 4th & 3rd Millennia, rulers & priests had people overseeing financial matters, & the invention of an early form of bookkeeping emerged. During this time records were kept using clay tokens.

The tokens represented a quantity of a good rather than actual numbers.  For instance, 3 tokens represented three units of whatever good was being counted.  Eventually the tokens became more complex. Different shapes represented different goods, & markings indicated the increasing numbers of goods available for trade.  Eventually, these markings were made on clay tablets rather than tokens.  This was a significant step toward the development of writing, as information was being sent from one person to another, and the use of abstract numbers came into play.  Phoenicians brought their own invention to the party – a phonetic alphabet that was most likely used for bookkeeping purposes.

These early bookkeepers were vital to the ancient economy, but technology has now rendered them useless.

But before I bombard you with more history, let’s talk about what bookkeeping is at its core.  Bookkeeping is the recording of monetary transactions of a given business.  It provides information from which accounts are prepared.  It is the foundation of accounting, but it’s also a distinct process all on its own.  Without good & accurate bookkeeping, there can be no accurate accounting, no balanced ledger, no enterprise.

Which brings us back to how bookkeeping evolved.  In the 13th Century, Medieval & Renaissance Europe was moving steadily toward a monetary economy and away from the barter system. To meet the needs of merchants engaging in multiple transactions with multiple entities, the demand for a more exact and complex method of bookkeeping increased. The Double Entry Bookkeeping (DEB) System (drum-roll, please) becomes the dominant method.  Here’s where Italy factors in again, although historical accounts get a little hazy.  It is believed by some that Double Entry was invented in the Jewish Community in the Medieval Middle East, which was then taught to Italian merchants by the Jewish bankers they did business with – but this is conjecture.  What is certain is that in 1494, in Venice, our hero Luca Pacioli publishes the first known treatise on bookkeeping, titled, “Details of Calculation & Recording”. In truth, a dude named Benedetto Cortruger had written a treatise on DEB in 1458, but it wasn’t published until 1573. Which is why Pacioli is referred to as “The Father of Accounting”. Being a righteous guy, he did give credit to Cortruger.

Whoever gets the billing, what is certain is that this was the beginning of modern bookkeeping.  Double Entry Bookkeeping essentially means that there are two entries in two different places for each transaction – the debit side on the left & the credit side on the right. This led to the invention of the ledger, or as it is sometimes called, the Greenbook. If the two sides of the ledger don’t agree, there’s been an error. BTW – in Latin, “debit” means “he owes”.  “Credit” means “he trusts”.

As time wore on, the mundane laborers who made these entries became too comfortable, & the work suffered.

In 1983, computers got into the act, when Scott Cook & Tom Prouxl founded Intuit. This was just two years after IBM had introduced the first PC.  Cook & Prouxl introduced Quicken & later QuickBooks, which would eventually revolutionize the world of bookkeeping.  Initially, however, professional accountants were resistant to the software, citing poor security controls, such as the lack of an audit trail, & non-conformity to traditional accounting systems.  Intuit recognized the need to refine the software, & in 2000 offered a version that included a full audit trail & a double-entry system. You can now get QuickBooks in a whole variety of flavors, specific to the industries using it, such as manufacturers, wholesalers, not-for-profits & yes, even accountants.

Sadly, the products have evolved, but not necessarily the people using them. This was the beginning of the end of modern bookkeeping, with CPA’s paying low wages to unqualified laborers to handle the routine entry work.  As tech continued to evolve, the problems multiplied, & in a few decades the industry has found itself in a tailspin. Apps are tools, not substitutes for human knowledge & skill.  As I’ve said before, every computer is only as good as the human using it. Unfortunately for bookkeepers, like it or not, the apps have replaced their labor. The burden of making sure entries are correct now falls to the accountants, who, along with their other duties, must police the work of the machines & the people running them.

            Nevertheless, accounting is the language of business, & I am fluent!



Thanks for reading,

Justin McAuliffe, CPA

Bellmore, New York

Updated By
CMA Sandeep Kumar – Founder – CMA CLUB INDIA
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