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Meet the Italian Mathematician Behind Modern-Day Accounting

January 3, 2017 / by Harlan Gleeson posted in Santa Monica, Los Angeles

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Harlan-Gleeson-for-web.jpgItalia. The land that brought us Mediterranean seascapes, the language of love, Michelangelo's "David" and, of course, the origins of keeping good books.

While solid accounting practices date back to ancient Egypt and Mesopotamia, our true Founding Father was, in fact, a Renaissance man: a mathematician named Luca Pacioli. A trusted employee of several successful merchants of Venice, Luca decided he needed a totally new way of accounting that would demonstrate a merchant's performance and the reasons behind his success (or lack thereof).

At the time, the Renaissance elite was developing an appreciation for the practice of algebra and its emphasis on balance. Whatever happens on one side of an equation must be accounted for on the other side.

According to NPR's All Things Considered, Pacioli, who was known to break bread with Leonardo da Vinci, saw in this mathematical thinking a way to appease and impress his high-flying clients. And thus double-entry bookkeeping was born.

While some might call accounting dry, others say the same of a fine chianti (as a compliment). The next time you make an entry in the balance sheet equation, Assets = Liabilities + Owners Equity, remember that the contemporaries of da Vinci recognized the art of accounting as a truly beautiful thing.

(If I've piqued your interest, you can check out our blog for more on balance sheets and P&Ls, trial balance basics and double entry accounting.)

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