Friday, September 11, 2009

Luca Pacioli????

Did he play for the Yankees?  Did he establish a winery in California?  Was he elected President of Italy?


 Fray Luca Bartolomes Pacioli, a Franciscan Monk, born in the mid-1400’s in Tuscany in Italy should be the patron saint of accounting and auditing.  All auditors and accountants should know his name.  He is reputed to be the inventor of double entry accounting on a single page, “to give the trader without delay information as to his assets and liabilities.”  He wrote that debit amounts should be listed on the left side of the page and credits listed on the right side. Did Pacioli place debits on the left because the Latin word for “left” is “sinister?”  And the Latin word for “right’ is “dexter,” giving us dexterous in English, the more graceful and beautiful.  Credits are beautiful and a joy to behold on the page.   The fray wrote that if the two totals are equal, the ledger was considered balanced. ‘If not,” says Pacioli,”that would indicate a mistake in your ledger, which mistake you will have to look for diligently with the industry and intelligence God gave you.”  Translated from the Latin by J. B. Geijsbeek, in “Ancient Double Entry Bookeeping,” 1914.  

 I remember Matt Daly, accounting professor at Regis University, telling me his rule “Debits on the left, Credits on the right, or Debits by the window and Credits by the door.” That is unless the desks face the other direction.

Let me know if you would like a copy of Frater Pacioli’s original Latin instructions on all this. Do you think the Jesuits are upset that history gives the Franciscan the credit for this financial and economic innovation?

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