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The basic idea of the debit and credit in a journal has been around since the 13th century. No one knows exactly how it started, but the oldest set of books referencing debits and credits were for the period 1299-1300 as posted by an Italian merchant named Manucci. The system was first described in writing by a Franciscan monk name Luca Pacioli. |
Pacioli lived from 1447 to 1517 and wrote a book, Summa de Arthmetica, Geometra, Proportioni et Proportionalita. The book was published in 1494 and contained a section called “Particularis de Computis et Scripturis” which translated is “Details of Accounting and Recording.”
The first accounting textbook describes the practices of merchants in Venice and how they used books in which they recorded debits on the left and credits on the right, totaled accounts at the end of a defined period, calculated profit and loss, and posted the amount to a capital account. For his contribution of this written description, Pacioli has been called the “Father of Accounting”.
It is amazing that in the more than 500 years that have passed since Pacioli’s writing the fundamentals of accounting have not changed. We still post to journals with debits on the left and credits on the right, we total accounts at the end of defined periods, calculate a profit or loss, and post the results to a capital account. These principles apply in government and all other forms of accounting.
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