Luca Pacioli, Father of Accounting
Fra Luca Pacioli is considered the “father” of accounting. In MCCCCLXXXXIV in his Summa, Pacioli included a 26 page accounting manual, Particularis de Computis et Scripturis, which became the foundation for recording business transactions and the basis of double entry accounting. His book opened with a listing of the three key things needed by anyone who wishes to carry on business carefully:
- A good accountant
- Proper internal control
The usage of the words “debit” and “credit” came from Fra Luca’s Summa. He said “quanto alor debito e anche credito” – “whenever there is a debit entry there is also a credit entry.” The use today refers to offsetting transactions. The original meaning of debito meant “owed to or belonging to” this entity, and credito meant “owed to some other entity by” this entity. And believe it or not, Luca said debitore ala sinistra e credito ala dextra – the debits go on the left and the credits on the right!
Pacioli sprinkled some sayings and quotes throughout his work. Some of these are:
- Without order, there is chaos;
- There is more to the making of a Good Businessperson than to the making of a Doctor of Laws;
- Though the businessperson’s head has a hundred eyes, yet there are still not enough for all their duties;
- Help comes to those who are awake, not to those asleep;
- Fame does not get under the blanket; let tiredness be a stranger to you;
- Little items don’t contribute knowledge to an owner;
- He who does nothing makes no mistakes; he who makes no mistakes learns nothing.