Matthew Ardeljan
Oct 24, 2015 · 3 min read

Accounting originates in ancient Mesopotamian times. Ancient cultures were carving numbers into stone & wet clay, some cultures discovered and started using papyrus. It seems people really like keeping records. Fast forward 4000 years and in 1494 a mathematician named Luca Pacioli authors a maths textbook that introduces double-entry accounting. He describes using journals, ledgers and includes a warning:

…a person should not go to sleep at night until the debits equal the credits.

Luca is referred to as the “Father of Accounting” and has a well known individual as a pupil and friend. Leonardo DaVinci.

What a boss.

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Luca Pacioli, probably smarter than you.

In his textbook Luca outlines the use of Assets, Liabilities, Capital, Income and Expenses. He also demonstrates the use of year-end closing entries and proposes using a Trial Balance to make sure it all balances. If you don’t know much about accounting the above paragraph is what every accounting system today relies on for it’s inner workings.

Luca gave this to us in 1494.

500+ years later and layers of abstraction hide double entry. Most accounting software users don’t enter a journal but rather a “sale for a t-shirt” and the system then reduces stock, increases cost of goods, increases income etc. The system does the double entry behind the scenes and this is a good thing.

Progress largely has been due to computers and software. Modern accounting software stops you doing things that would put your ledger out of balance and you can pull out whatever device you have in your pocket and enter a sale from your yacht, if that’s how you roll.

However we were promised a future with flying cars. Flying cars! We’re not there but we almost have self driving cars. A self driving car plots the route itself, works out how fast it should go and checks for pedestrian on its own. It drives itself. You could have your latte in one hand, your phone in the other while sitting cross legged.

Accounting software however is still hugely dependent on humans.

These essays will start with an exploration of how accounting software is changing and will continue to change. We will also look more broadly at the changes in business in general. There are technologies that will provide the affordance for change, we will look at possibilities enabled by the change, including what will sound like science fiction but is increasingly becoming possible. We’ll also look at how this impacts the certain processions, including the accounting profession — often a controversial topic.

Before we break off into sections here are a few quotes to set the scene. The first from an article written by Alistair Croll on O’Reilly:

That accounting will change is obvious.

The next two quotes are from Aaron Levie, CEO of Box:

…software used to be about making existing work more efficient. Now, the opportunity for software is to transform the work itself. Source

Adding software to a broken process doesn’t make you digital. The biggest challenge is reimagining the process, not writing the software. Source

Let’s explore.

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