You may be wondering: what could be more interesting than accounting? After all, accountants are always the LIFO the party.
Well, we’ve got something that might pique your interest (especially if you’re a history buff): the history of the accounting profession!
If you enjoy history and accounting (or at least kind of like those things), this one is just for you.
1200- The First Requirement for Businesses to Keep Accounting Records
The first whispers of the accounting profession were heard more than 800 years ago.
At this time, merchants in the Italian republics began keeping records of their transactions. This was mainly to keep track of the day-to-day transactions, along with the credit accounts with other businesses.
We shudder to imagine bookkeeping without GAAP, but everyone has to start somewhere!
1861– The first income tax law in the U.S. was passed during the Civil War.
Abraham Lincoln didn’t just love the theatre – he also loved taxes! In 1861, Lincoln signed The Revenue Act of 1861.
This legislation taxed imports, provided for a direct land tax, and imposed a tax of 3 percent on individual incomes over $800 (which, in current dollars, is about $18,000 in today’s dollars).
Forget the Lincoln Monument – this was a monumental moment in taxation!
1879- The first known official meeting of North American accountants was held in Montréal in June 1879.
Bonjour, formalized accounting societies!
The purpose of this meeting was to establish a society to promote the profession. Some of the founding members of this group had a connection with the Institute of Chartered Accountants of Edinburgh.
1902- By this time, there were three large associations that now existed in Canada.
The oldest was established in 1902 as the Dominion Association of Chartered Accountants.
1914– The first women are admitted to the profession of accounting.
In 1914, the first World War broke out. As thousands of men left the civilian workforce to join the frontlines, thousands of Canadian women stepped into their old jobs! This was a monumental shift toward gender equity in the field, as it irrefutably established womens’ competency in the area.
Ellen L. Fairclough was one of the first women in Canada to earn a professional accounting designation, and later to form an accounting firm, in the 1930s.
1917- The role of tax accountants was created in 1917.
World War One had an impact on the accounting industry aside from it’s assistance toward gender parity:
Before the war was over, the Canadian government, led by prime minister Robert Borden, enacted the Income War Tax Act which required businesses to keep accounting records as well as to file tax returns.
Here’s a Canadian perspective on income tax in Canada.
1917- The University of Saskatchewan became the first university or college in Canada to offer accounting classes in 1917.
Additionally, the University of Saskatchewan was also the first to offer a major in accounting.
We can only assume that this is where the first Canadian accountants held the first accounting parties!
1929- The Great Depression took place and a stock market crash ensued.
The American Congress then reacted to the aftermath of this event and enacted the Securities Act of 1933 and 1934.
This resulted in the creation of the Securities and Exchange Commission, an institution within modern investing, which required companies to record accurate books, transactions, and specified maintenance of internal accounting control.
It also required companies to file financial statements with GAAP (Generally Accepted Accounting Principles).
All of these big changes within the accounting world meant that accountants were increasingly in demand by businesses across Canada!
1970- In 1970, a bachelor’s degree became mandatory to obtain accounting licenses in Canada.
2001- Enron and the collapse of US Andersen.
The history of accounting hasn’t always been rosy: there’s been a fair share of scandal. Perhaps most notoriously of these was the Enron Scandal of 2001, which made worldwide headlines.
This case of accounting fraud led to the bankruptcy of the Enron Corporation and dissolution of the Arthur Anderson LLP.
Enron Corporation was an American energy company that was based in Houston, Texas.
2014- In October, 2014, the CPA designation was created to unite the three accounting credentials in Canada.
Name a more iconic trio!
