Governance

Ode to the Bookkeeper

January 26, 2015
Beeld: © Nationale Beeldbank

Do you know any people who are proud of their job as bookkeeper? I do not, unfortunately. But maybe this blog will change that.

The job title of bookkeeper has fallen into disuse over the years and has been replaced by titles such as accountant, financial staff member, and controller. This development is symptomatic of a certain disdain for bookkeeping.

The image of the bookkeeper is even more negative outside the financial professions. Boring, too much attention to detail, not a very exciting profession at all. No, you are better off as an entrepreneur: at least that job creates riches! Yet, all this very much undervalues the noble art of counting and calculating.

Jacob Soli, a professor of accounting in the United States, wrote a wonderful book about the history of bookkeeping. In 'The Reckoning' (2014), he convincingly establishes a link between the prosperity of cities, regions, and countries in the past and – you are guessing it already – how serious they were about their bookkeeping. It was successful merchants, such as the Italian Fransesco Datini, who, over seven hundred years ago, kept the books daily and disciplined like full-fledged bookkeepers.

"Double-entry bookkeeping is essential for princes and leaders" 

Before the monk Luca Pacioli describted double-entry bookkeeping in 1494, the impact of revenues and expenditure on assets were documented in large books in the form of income and expenses. Neglecting the books had severe consequences and resulted in e.g. the decline of the once prosperous House of de Medici in Florence. In the past, bookkeepers played a leading role in the finances of countries by bringing order to their budgets. In 1604, Simon Stevin, the Flemish-Dutch hydraulic engineer and physicist, wrote in his book Vorstelijke Boekhouding (Royal Bookkeeping): "Double-entry bookkeeping is not just of use to public organizations, it is essential for princes and leaders."

This importance was acknowledged in the past. From the Renaissance to the nineteenth century, paintings were made of bookkeepers. Philosophers discussed the complex and useful role of efficient and critical bookkeepers. However, the importance of and interest in proper bookkeeping seems to have vanished. The expert recording, processing and verifying of the figures in order to ultimately draw up accounts, seems to have been relegated to a secondary role.

For example: almost all countries hide the actual amount of pension obligations, infrastructure, tax revenues, and guarantee obligations. They do not operate accoriding to the rules of double-entry bookkeeping. Ministers of Finance resolve financial problems by shifting revenues and expenses to and from the past. And often it seems  irrelevant whether that decision creates or destroys value.

Professor Soli's book is an ode to the bookkeeper and shows the need for rehabilitation of the noble profession of bookkeeping. This rehabilitation serves to prevent that future generations will be presented with the bill, because we did not properly draw up the accounts.

Prof. Dr Arco van de Ven RA is a Professor of Public Information Management at the TIAS School for Business and Society at Tilburg University. This blog is based on a previously published column in the Controllersmagazine.

 

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