One of the most fundamental concepts in economic theory is the idea that a market economy must have a method of enforcement in order to maintain market structure. There must be a system that defines the market rules, punishes those who break the rules, and serves to incentivize fair participation. The accounting industry is in many ways a part of the group that enforces the entire economic system, and we are morally obligated to take advantage of that position, but unfortunately, we don't always succeed at fulfilling that obligation as an industry as a whole. Recent events in accounting have prompted me think it's probably a good idea to step back and take a look from the perspective of the industry as a whole. In the midst of things like working through Excel spreadsheets with caffeine-fueled focus while being cramped with a group of people in a conference room rivaling a coat closet, we often forget why we're here, which is to serve help enforce market structure through accountability. The lack of accountability in recent years is a scary thing considering its fundamental significance in human history, the extent of which I learned in graduate school when I wrote a paper on ancient accounting methods for my course on Accounting Theory.
While the wheel is generally considered the greatest invention in the history of mankind, I believe that writing was the greatest invention in the history of mankind, and that the early accounting methods used by ancient civilizations were responsible for its invention. In the 1970’s, archaeologist Denise Schmandt-Besserat began extensive excavations at the birthplace of state formation in the area the Greeks later called Mesopotamia, which literally means “land between the rivers.” The area is between the Tigris and Euphrates Rivers in modern day Iraq[1]. The banks of the rivers have a very clay rich soil, which the people used for many purposes, as it dried into durable bricks, even more so when a kiln was used, so everyday objects were remarkably well preserved. The oldest writing[2] uncovered dates to around 5,000 years ago, but the archaeological record revealed a great many clay objects that were distinct from the pots and other items typically found at archaeological sites . Many of the objects appeared to be some type of token, and some resembled animal shapes, and were varied in size. Another unique discovery at the sites were unusual clay balls that appeared hollow, and when x-rayed, revealed various amounts of the tokens contained inside. After the analysis of thousands of similar objects spanning a period of over five thousand years, Schmandt-Besserat realized what she had found – the earliest methods of accounting found to date. Three decades of excavation unearthed rich archaeological sites at dozens of cities that represent a time span of thousands of years in history.
Starting around 8500 BCE[3], the ancient Mesopotamians felt compelled to find effective ways to keep track of their property, to say “This item belongs to me.” They began shaping clay into tokens of all different sizes, carving designs on the tokens, and then allowed the tokens to dry. These tokens were a type of seal – they were methods of communication of ownership. The invention of agriculture began around the same time, but it took a few thousand years before widespread adoption, and many of the tribes remained nomadic during that transition. They often engaged in bartering transactions with other tribes that involved livestock and other goods, and they felt the need to find a way to ensure the items they received were getting what they paid (exchanged) for. Instead of just making seals out of tokens, the ancient Mesopotamians began using the token as a system to keep track of their goods. The method proved to provide little more assurance than before, as the people delivering the goods would also be responsible for keeping track of the tokens, and a few could easily be dropped along the way if, say, an animal died due to negligence or was stolen. The limited success caused the Mesopotamians to reevaluate their situation, and as a result, developed the earliest system of internal control.
Tokens were shaped to represent each animal, which were placed inside a hollow clay ball and then dried. The ball was sent with the delivery of the goods, and the recipient could then break open the ball to verify all of the animals were accounted for. Eventually, the tokens were shaped into animal-like figures for when the deliveries consisted of different types of livestock, which made accounting easier, but there were still limitations to the system. What if the herd has to change hands along the journey? That would defeat the entire purpose of using the hollow balls if they had to be broken halfway to the destination. So they began pressing the shapes of the tokens onto the exterior of the clay balls, revealing the contents on the interior and allowing the buyer to verify the delivered herd was intact.
States started forming around 3500 BCE and people began to lead more sedentary lives, which led to increased trade at thriving marketplaces and massive temple-corporations. Since they were spending less time roaming the land, they had more time to think and invent, so the Mesopotamians began experimenting with the concept of pressing shapes into clay. These experiments prompted a cognitive evolution – an actual remapping of the brain’s internal structure – that allowed for the development of pictograms drawn on clay tablets by around 3100 BCE, and, eventually, the development into the first abstract written language, where the characters of the alphabet are no longer pictograms. This progression, marked by a major evolution in the structure of Mesopotamian society and state formation, is evidence that writing, which I consider the greatest invention in the history of mankind, was not developed in the quest for self expression or social correspondence, but from the deep seeded need for accountability. The vast majority of the Mesopotamian writing that was excavated consists of some type of recordkeeping or official documentation. Reliable methods of accounting were developed side by side with the formation of the state and the creation of the earliest marketplace economies, and eventually led to the invention of writing. The archaeological record shows strong evidence that accountability is a fundamental piece of the concept of civilization, and has had an undeniable impact on the human condition.
[1] It’s a very good thing Schmandt-Besserat finished with her research in the late 1990’s, because hundreds of billions of dollars of American tax dollars funded the bombing of historic sites and looting of the museums since the US set its imperialistic sights on the oil rich Iraqi soil.
[2] Writing in the earliest phonetic language.
[3] Since dating societies that appeared thousands of years before Roman Calendar as however many years “Before Christ” is rather arbitrary, most historians and anthropologists replace “BC” and “AD” with BCE (Before the Common Era) and CE (During the Common ERA), but the actual year doesn’t change.
No comments:
Post a Comment