12 Advancements That Have Revolutionized The Art of Accounting

Advancements in accounting

Civilization has come a long way since the days of counting fingers. The art of “keeping track” of things with value, today known as “accounting”, has evolved with the advancement of technology throughout the ages. As technological innovations have emerged, the methods and functions of accounting have changed as well.

From the historical origin of money to the development of online web apps, here are twelve technological advances that have drastically impacted the practice of accounting.

1. Money.

Perhaps this seems more like a concept than a technology, but the truth is without something to physically represent monetary value, there wouldn’t be anything to account for. From clay tokens and tablets to gold, copper, and silver coins to paper money, the technological innovation of physical money is basically the whole point of accounting.

2. Abacus.

This innovative beads-on-wire device was the very first calculator. The abacus was invented in Asia, and used there as well as throughout Europe and the Arabic world in the Middle Ages. Today it is still used in the Middle East, Japan and China and is now called the suan-pan.

3. Slide Rule.

In the 17th century, the concept of the logarithim (a mathematical calculation) enabled the invention of the slide rule. Over the next three hundred years several versions of the slide rule existed, but it wasn’t until World War Two that a small hand-held version was created so that pilot could do quick calculations. The slide rule became an accounting stable until the 1970’s.

4. Electricity.

In 1780, Ben Franklin used a key and a kite to discover the one thing that has changed the world more than almost any other — electricity. Electricity fueled the adding machines, calculators, and computers that came to dominate the field of accounting.

5. Cathode Ray Tube.

Invented in 1928, this humble-looking glass tube became the light behind the television and the earliest computers. The cathode ray tube allowed for the invention of computers—and there is no doubt of the impact computers had on the field of accounting.

6. Adding Machines.

Technically, the very first adding machine was designed by no other than Da Vinci. But it wasn’t until the late 19th century that William Burroughs invented a functioning adding machine. These large, clunky metal devices were very popular in the 1950’s (although they’d slimmed down to a more manageable size by then), and were still used in accounting firms and cash rooms until the 1970’s. You’ll still find them in cash rooms of large retail organizations today.

7. Comptometer.

This adding machine was the first machine that functioned entirely by pressing the keys—making it the precursor to the handheld calculator. While it was invented in the late 19th century and was used then by the U.S. Treasury, it wasn’t until the 1940’s that it became popular, and it became an office staple in the 1950’s.

8. Handheld Calculator.

While the early calculators were as large as today’s computers, innovations in the technology of batteries and then solar cells, along with microtechnology, made the handheld calculator possible. In the 1970’s, the pocket calculator was an absolute must for every accountant, and along with pocket protectors may have led the way to today’s geek chic.

9. Computer.

While the first computers weren’t actually invented for accounting, they might as well have been. They were created to solve complex mathematical equations, and the earliest computers were massive, (weighing 80 tons or more—couldn’t hold that in your lap, could you?). Today, computers process accounting information faster than accountants can type it in, making their work fast, more efficient, and more accurate than ever before.

10. Data Storage.

No accountant today would envy the clerks of old, scratching numbers into clay tablets. Most working in the field today don’t even miss the days of large book ledgers with column after column of handwritten numbers. Thanks to the innovations of the floppy disk, then the computer disk, and now things like flash drives, carrying large amounts of accounting data from one computer to another is easy as could be.

11. Microchip.

This tiny little device was able to replace entire rooms of vacuum tubes—making computers shrink from that 80-ton megalith discussed earlier to the small laptop that can now be carried in a briefcase or backpack.

12. Software.

As soon as computers became standard in offices, software programs were created to replace ledgers. Spreadsheets became the accounting industry standard, eliminating the majority of human error and allowing accountants to concentrate their energies in other areas, such as creating innovative cost-saving business practices instead of adding up columns of numbers over and over again. Today, thanks to programs like Quicken and others, individuals can manage their own finances just as efficiently as any accountant!

As you can see, technology has changed the face of accounting beyond recognition from its early days. Each new innovation has elevated, focused, and improved the efficacy of accounting making it what it is today—a standard business practice, and a powerhouse of financial management. It might seem like an odd pairing, but numbers and technology make for a very happy marriage.