GETTING STARTED

Date: 2015-10-07; view: 432.

1. Scan the passage below and say what it is devoted to:

In attempting to explain why double entry bookkeeping developed in fourteenth century Italy instead of ancient Greece or Rome, accounting scholar A.C. Littleton describes seven "key ingredients" which led to its creation:

Private property, Capital, Commerce, Credit, Writing, Money, Arithmetic

Many of these factors did exist in ancient times, but until the middle ages they were not found together in a form and strength necessary to push man to the innovation of double entry. Nevertheless, the problems encountered by the ancients with record keeping, control and verification of financial transactions were not entirely different than our own today. Governments, in particular, had strong incentives to keep careful records of receipts and disbursements - particularly as concerns taxes. And in any society where individuals accumulated wealth, there was a desire by the rich to perform audits on the honesty and skill of slaves and employees entrusted with asset management.

2. Discuss with your groupmates the following questions:

· When did double entry bookkeeping develop?

· Who describes seven "key ingredients" which led to the creation of double entry bookkeeping? What are they?

· Did these factors exist nowadays?

· Who had strong incentives to keep careful records of receipts and disbursements?