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ACCOUNTANTS
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ACCOUNTANTS . The See also:term " accountant " is one to which, of See also:late years, its See also:original meaning has been more generally attributed—that of an See also:expert in the See also:science of See also:book-keeping. It is sometimes adopted by book-keepers, but this is an erroneous application of the term ; it properly describes those competent to See also:design and See also:control the systems of accounts required for the See also:record of the multifarious and rapid transactions of See also:trade and See also:finance. It assumes the See also:possession of a wide knowledge of the principles upon which accountancy is based, which may be shortly described as constituting a science by means of which all See also:mercantile and See also:financial transactions, whether in See also:money or in money's See also:worth, including operations completed and engagements undertaken to be fulfilled at once or in a future, however remote, may be recorded; and this science comprises a know-ledge of the methods of preparing See also:statistics, whether See also:relating to finance or to any transactions or circumstances which can be stated by numeration, and of ascertaining or estimating on correct bases the cost of any operation whether in money, in commodities, in See also:time, in See also:life or in any wasting See also:property. Generally, accountancy may be described as being the science by means of which all operations, as far as they are capable of being shown in figures, are accurately recorded and their results ascertained and stated.
The origin of the profession of accountancy in See also:Great See also:Britain is difficult to trace; auditors of accounts were naturally of very See also:History, See also:early existence, being mentioned as See also:officers of See also:im-
portance in the statutes of See also:Westminster in the reign of See also:Edward I. The See also:art of accountancy on a scientific principle must certainly have been understood in See also:Italy before 1495, when See also:Friar Luca dal Borgo published at See also:Venice his See also:treatise on book-keeping; but the first known See also:English book .on the sciencewas published in See also:London by See also: Huic Omnia Feruntur accepta et in tota Ratione mortalium sola Utramque Paginam facit."
An early Dutch writer appears to have suggested that double-entry book-keeping was even in existence among the Greeks, pointing to scientific accountancy having been invented in remote times.
There were several See also:editions of Richard Dafforne's book printed—the second edition having been published in 1636, the third in 1656, and another was issued in 1684. The book is a very See also:complete treatise on scientific accountancy, it was beautifully prepared and contains elaborate explanations; the numerous editions tend to prove that the science was highly appreciated in the 17th See also:century. From this time there has been a continuous See also:supply of literature on the subject, many of the authors styling themselves accountants and teachers of the art, and thus proving that the professional accountant was then known and employed. Very early in the 18th century the services of an accountant practising in the See also:city of London were made use of in the course of an investigation into the trans-actions of a director of the See also:South See also:Sea See also:Company, who had been dealing in the company's stock. During this investigation the accountant appears to have examined the books of at least two firms of merchants. His See also:report is described Observations made upon examining the books of Sawbridge and Company, by See also: The Companies Act of 1862 Ied to a large See also:extension of the business of accountants, both as auditors and liquidators of companies; and the acts relating to See also:bankruptcy passed between the years 1831 and 1883 added to the See also:work devolving on professional accountants. The Companies Act 1879, which affected banking companies, made provision for the audit of their accounts, and it has been found desirable, in most cases, to appoint professional accountants to this See also:duty. The experience and professional knowledge of trained accountants have, in fact, been utilized by their See also:appointment as auditors in the See also:majority of See also:joint-stock companies, whether manufacturing, banking, trading or created for any other purpose. Until the Companies Act 'goo was passed there was no See also:general See also:obligation upon limited companies to have auditors; this act not only requires that auditors shall be appointed in all cases, but provides for their remuneration, and to a limited extent defines their rights and duties. The legislature evidently did not find it easy to formulate at all clearly the duties of auditors, and it seems reasonable to suppose that any general See also:definition will prove an impossibility, as the work which auditors undertake must vary very widely, and depends largely upon the See also:scope of the operations the accounts of which are to be examined. The duties of practising accountants See also:cover a very wide See also:area: they act as trustees, liquidators, receivers and managers of Duties. businesses, the owners of which are in See also:default or their affairs in See also:liquidation, both under the direction of the courts and by appointment of creditors and others; they are largely engaged as arbitrators, umpires and referees in See also:differences relating to matters of See also:account or finance; they prepare the accounts of executors and trustees, and the necessary statements of affairs in cases of bankruptcy, both of firms and companies; they prepare accounts for prosecutions in cases of fraud and misconduct; and they are constantly called upon to unravel and properly state the accounts of complicated trans-actions. Their services are commonly required to certify the profits of businesses intended to be sold, either privately or to companies by means of a published See also:prospectus; and, in cases of compulsory purchases of businesses by railway companies and public bodies, the statements of the profits of the businesses to be acquired are generally made by them. In a very large number of financial operations they are called upon to give ad-See also:vice and prepare accounts, and in few business matters requiring arithmetical calculations or involving the investigation of figures, and particularly where a considerable acquaintanceship with the principles of See also:law is needed, are their services not utilized. One of the most important duties undertaken by accountants is the audit of accounts, and this duty has, of late years, been widely extended. Originally, auditors were appointed to ex-amine and vouch statements of receipts and payments; but the provisions made in acts of parliament in relation to audit, and the requirements of most articles of association of limited See also:corn-Auditors. panics, put much graver responsibilities on auditors, who are now generally required to certify to the accuracy of See also:balance sheets and of See also:revenue and other accounts, the performance of which duties involves far more knowledgeof accounts than was once required. The efficiency, in most cases, of audits conducted by skilled accountants has led the public to attach exceptional value to their audit certificates, and to demand extensive knowledge and ability in the conduct of the audit of the accounts of public companies. One other requirement which is generally regarded as indispensable, is that the work of audit should be very expeditiously performed; for it is easy to understand that, were the presentation of the accounts of a company and the See also:distribution of dividends materially delayed in consequence of the audit, much inconvenience would result, while the value of the See also:criticism of the accounts of business operations would be much deteriorated if it could not be made very shortly after the accounts were closed. 
In these circumstances, in the cases of large concerns with wide ramifications and numerous transactions, it is necessary that auditors should have the help of trained assistants, and thus the See also:personal examination of details by the auditor himself is, to a large extent, rendered unnecessary and the cost of audit materially reduced. This delegation of duty by auditors is generally well understood, and is in accordance with the requirements of those concerned; but there has been a tendency of late years to enlarge the responsibilities of auditors to an extent which, if persisted in, might render it dangerous for men of reputation and means to accept the duties.
While the number of practising accountants has of late years been steadily increasing and their services are correspondingly appreciated, the See also:necessity for controlling those exercising the profession and for improving its status has Izorgtlonan-
a
naturally become apparent. The first important steps
in this direction were taken by the accountants in Scotland—the Society of Accountants in See also:Edinburgh being incorporated by royal See also:charter in 1854; similar See also:societies in See also:Glasgow and See also:Aberdeen being also incorporated by charter in 1855 and 1867. The See also:Institute of Accountants was formed in London in 1870, but did not receive a royal charter until the lrth May '88o, when all the then existing accountants' societies and institutes in See also:England were incorporated as the Institute of Chartered Accountants in England and See also:Wales, and means were, provided by which all the then practising accountants in these countries could claim membership thereof. In the See also:year 1885 the Society of Accountants and Auditors was incorporated, but has obtained no charter; this See also:body, while numbering among its members a considerable number of practising accountants in the See also:United See also:Kingdom, also includes treasurers and accountants to cities and boroughs in England, as well as clerks to chartered and other accountants. A large proportion of its members also consists of accountants practising abroad. In 1888 an Institute of Chartered Accountants was formed in See also:Ireland, and a great many institutes and societies have been formed in the See also:British colonies and in the United States, some of which have See also:local charters. It is curious to See also:note, however, that, outside the United Kingdom, it was only in the British colonies that associations of practising accountants existed, until, in 1895, an Institute of Accountants (Nederlands Institutt See also:van Accountants) was founded in See also:Utrecht for Dutch accountants; when, although the principles of accountancy have been well understood and practised in See also: In the United States the organization of professional account-ants is of . quite See also:recent growth. The first society formed in America was " The New See also:York State Society of Certified Public Accountants," and shortly afterwards (in 1896) the New York state legislature passed an act authorizing the State university
to confer the degree of certified public accountant (C.P.A.) on the members of the society, while requiring all subsequent entrants to pass an examination. This degree,. however, can be obtained, like other university degrees, without being a member of the society. Other states, notably See also:Pennsylvania, See also:Maryland, See also:California, See also:Illinois, See also:Washington and New See also:Jersey, have followed the example of New York. In 1903 the various state societies formed themselves into a federation. There is also an See also:independent society of practising accountants, the See also:American Association of Public Accountants, with See also:objects similar to those of the federation, but steps have been taken to bring about an amalgamation between the two in order to form one central society to look after their See also:common interests, without, however, interfering with the individual organization of the various state societies.
See R. See also: See also:Lisle, Accounting in Theory and Practice (1899); F. W. Pixley, Auditors and their Liabilities (1901). The professional See also:periodicals, The Accountant (vol. i., 1877) ; Accountant's See also:Journal (vol. i., 1883–1884) ; The Accountants' See also:Magazine (vol. i., 1897) ; Incorporated Accountants' Journal (vol. i., 1889–1890) ; Accountics (U.S.A., vol. i., 1897) may also be consulted, and also the Year-books of the Society of Accountants and Auditors, and of the Institute of Chartered Accountants. (J. G. Additional information and CommentsThere are no comments yet for this article.
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