giving an account of accounting history: a reply to keenan

( )Critical Perspectives on Accounting 1998 9, 685]700Article No. pa980272

GIVING AN ACCOUNT OF ACCOUNTINGHISTORY: A REPLY TO KEENAN

CHRISTOPHER J. NAPIER

School of Management, University of Southampton, Highfield,Southampton, UK

Keenan’s methodological criticisms of ‘‘Genealogies of Calculation’’ areshown to be either innocuous or invalid. His sketch of a nonteleologicalevolutionary explanation of the transition from charge and dischargeaccounting to double-entry in nineteenth century Britain is criticized, andan alternative genealogical sketch is provided.

1998 Academic PressQ

Introduction

(The paper ‘‘Genealogies of Calculation’’ Miller & Napier, 1993; hence-) ( )forth ‘‘M&N’’ has met with several criticisms. Scorgie 1995 has criti-

(cized the paper on the ground that one of its ‘‘case studies’’ theemergence of discounting techniques of capital investment appraisal, a

)case study based on Miller, 1991 reveals an ignorance of the earlyappearance and use of such techniques, or rather a glib rejection ofhistorians who provide evidence of discounting by describing them asshowing a tendency ‘‘ to be too quick to interpret as cases of proto-dis-counting the early examples where imputed interest is treated as a cost

(in the context of long-term investment’’ M&N, p. 640, fn. 5}see also) ( )Scorgie, 1996 . Fleischman & Tyson 1997 have discerned in the paper a

hostility to archival research within accounting history. In his paper inthis issue, Michael Keenan aims to defend what he calls ‘‘ traditional’’accounting history research methodology from three claims that he sug-gests are advanced by M&N. The first of these is that the domain oftraditional accounting history research has been restricted to double-en-try bookkeeping. The second is that explanation should be rejected as aresearch objective for accounting history. The third is that evolutionarymodels of historical explanation are necessarily teleological.

Address for Correspondence: School of Management, University of Southampton, High-( ) ( )field, Southampton, SO17 1BJ, UK. Tel.: +44 0 1703 595318; fax: +44 0 1703 593844;

e-mail: [email protected]

Received 22 January 1997; revised 23 June 1997; accepted 5 September 1997

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1045-2354/98/060685+16 $30.00/0 1998 Academic PressQ

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I shall address Keenan’s arguments with respect to the first twoissues together in the next section of this comment. His remarksconcerning evolutionary explanations in accounting history will then be

( )considered, alongside his ‘‘sketch of an explanation’’ Keenan, p. 661 ofthe general adoption of double-entry bookkeeping in England in thenineteenth century. However, at the outset it is worth summarizing thethrust of Keenan’s claims: if his analysis is correct, then, whateverresearchers may be doing when they write genealogies of calculation,they are not acting as historians. Given that writers such as Miller &

( )1 [ ]O’Leary 1987 assert bluntly that ‘‘The concern of their paper is( )historical’’ Miller & O’Leary, 1987, p. 235 , then either history is wider

than Keenan would admit or an important avenue of research is beingfundamentally misdescribed by its practitioners. If the latter is the case,

( )then the ‘‘new accounting history’’ Miller et al., 1991 is like the Em-peror’s new clothes in Hans Andersen’s story: illusory.

Domains and Explanations

( )Recently, Carnegie & Napier 1996 have suggested that the so-called‘‘new’’ accounting historians have constructed a caricature of the ‘‘ tradi-tional’’ accounting historian:

Who decontextualizes accounting, who celebrates progress and therebysubtly denigrates the past, who explains everything by reference toneo-classical economics, who at worst sets out on a ‘ treasure hunt’merely to establish the oldest, the earliest, the strangest, at best views

( )the past entirely from the perspective of the present p. 8 .

However, they go on to observe, ‘‘in their substantive work, ratherthan in their polemics, the differences between the various ‘schools’ are

( )often more of degree than of kind’’ Carnegie & Napier, 1996, p. 8 . It[ ]would seem that this is also Keenan’s conclusion: ‘‘ T he methodologies

of accounting history and genealogies of calculation are to be distin-guished, not so much by their respective research domains as by thedifferent ways in which topics, even the same topics, may be re-searched: with different objectives and different means for achieving

( )those objectives’’ p. 648 .It is difficult to disagree with Keenan’s remark that the four case

studies of a genealogical approach offered by M&N address topics thathave been, or could be, researched from a traditional viewpoint. Indeed,in producing their interpretations and analyses, the researchers whosework is summarized by M&N often explicitly draw on the documentsand materials brought to light by traditional researchers. However, adistinction might be drawn between traditional and genealogical ap-proaches along the following lines: traditional researchers are seen asconcentrating largely on documenting and explaining practices, whilegenealogists stress rationales: ‘‘The point of history in this sense is to

Giving an account of accounting history: a reply to Keenan 687

make intelligible the way we think today by reminding us of its conditions( )2of formation’’ Miller & O’Leary, 1987, p. 237, italics added . Much of

what M&N classify as traditional research in accounting history concernsitself with tracing the emergence of specific practices, and importanttraditional contributors warn against locating accounting history within

( ) [ ]any ‘‘history of ideas’’. Thus Yamey, 1956, p. 3 notes: ‘‘ O ne mustdiscard the idea that the emergence of double-entry represents thetriumph of the Renaissance search for breadth and simplicity over themeticulous medieval concern with detail.... The thesis... may seem tosome to be so unplausible or unrealistic as not to warrant discussion.’’

Now this remark of Yamey’s, while it may be a useful example ofhow traditional accounting history is uneasy with the move from prac-tices to rationales, actually acts as a counter-example to any claim thattraditional accounting history cannot ask questions about ideas: Yameyis perfectly able to raise the issue of whether double-entry was aproduct of a Renaissance zeitgeist, no matter how quickly he scurries

( )away from it. However, it does support the statement of M&N p. 639that ‘‘The traditional approach to accounting history cannot easily ask,let alone answer, such questions’’: an uneasiness with issues relating toideas and rationales will lead a traditional researcher to concentrate onpractices and techniques. The implication of M&N is that, even if atraditional researcher were to address the history of accounting ideas,this would be done in a significantly different way from a genealogist.Not only what counts as an ‘‘accounting idea’’}the issue of the domainof the research}but the motivation} to establish the origins of presentideas in terms of evolution and progress, rather than to ‘‘ fragment anddisturb what we might like to see as the basis of our current ideas and

( )practices’’ Miller & O’Leary, 1987, pp. 237]238 }would be potentiallydifferent. Traditional and genealogical research are unlikely to be ‘‘in-commensurable’’, in the sense that a genealogist would go so far as todeny that practices such as double-entry bookkeeping are currently partof the legitimate domain of accounting history research or that a tradi-tionalist would be unable to see any value or insight in the approach toideas and rationales adopted by the genealogist. If Keenan actuallyrequires such incommensurability to distinguish methodologically betweena traditional and a genealogical approach, then so be it, but M&N makeno such claim.

( )Keenan p. 10 asserts that M&N reject ‘‘historical explanation as anobjective, and arguably the principal objective, of historical research’’. Hepoints out that this rejection is not explicit, but deduces it first from arejection by M&N of specific modes of explanation, and secondly fromthe absence of a positive avowal of explanation as a general objectiveof historical writing. Keenan’s claim could be rebutted on logical groundsas an example of the fallacy of induction: just because he has discov-ered two or three specific instances of what he asserts, he is notthereby able to conclude that his assertion holds generally. Indeed, analternative reading of Keenan’s evidence is that M&N regarded thequestion of whether history is or should be about explanation as being

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comparatively unproblematic and therefore not worthy of comment,merely wishing to warn their readers against particular approaches tohistorical explanation.

( )In an earlier version of M&N Miller & Napier, 1990 , the authorsreferred extensively to the work of the French historian Paul Veyne, somay be presumed to share his main methodological views. Veyne isclear that history involves explanation:

It is often said that history cannot be content to be an account: itexplains, too}or, rather, it should explain. This amounts to admittingthat in fact it does not always explain, and that it may allow itself notto explain without ceasing to be history... To which it can be retortedthat the difficulty for history would, rather, be not to explain, for theslightest historical fact means something; it is a king, an empire, awar.... History never goes beyond this level of very simple explanation;it remains fundamentally an account, and what is called explanation isnothing but the way in which the account is arranged in a comprehensi-

( )ble plot Veyne, 1984, p. 87 .

Veyne goes on to claim that:

The word ‘explanation’ is taken sometimes in a strong sense in which itmeans ‘‘ to assign a fact to its principle or a theory to a more generaltheory’’, as science or philosophy does, sometimes in a weak andfamiliar sense, as when we say, ‘‘Let me explain to you what happened,and you will understand.’’ In the first meaning the historical explanationwould be a difficult scientific conquest, accomplished at this time ononly a few points of the eventworthy field... In the second meaning onewonders what page of history might not be explanatory, so long as it isnot reduced to mere gibberish or to a chronological list, and so long as

( )it has some meaning for the reader Veyne, 1984, p. 88 .

( )Veyne 1984, p. 88 concludes that there is no historical explanation inthe first, ‘‘scientific’’, sense: ‘‘explaining, for a historian, means ‘ to showthe unfolding of the plot, to make it understood’.’’

Now, it must be admitted that Veyne did not make it into the finalversion of M&N, but the distinction he draws between explanation as‘‘assigning to a more general theory’’ and as ‘‘making what happenedunderstandable’’ is clearly an important one. It is one widely known in

( )the philosophical literature see for example Von Wright, 1971 . Unfortu-nately, the use of the word ‘‘explain’’ has, in much of the accounting

(literature, become associated with the former meaning Watts & Zimmer-man, 1986, p. 2} it is no accident that these authors rely heavily fortheir view of explanation on the works of Hempel, who attempted to

)argue that explanation was of one type whether scientific or historical .If the word ‘‘explain’’ is often taken to be an ellipsis for ‘‘explainaccording to scientific laws and principles’’, then it is not surprising thatM&N avoid using the word, except, as Keenan observes, when criticiz-ing modes of explanation that attempt to do precisely that.

Such a line of argument deals with Keenan’s claim about M&N, but it[ ]could be viewed as conceding Keenan’s claim about history: ‘‘ T he


explanatory objective of historical research is... a defining characteristic( )of a historian’s proper performance’’ p. 650 . In other words, if a

researcher is not setting out to explain then the researcher is not actingas a historian. In reaching this view, Keenan relies heavily on a sugges-tion of Graham, that ‘‘ to give an historical explanation of some event or

( )state of affairs is to give its history’’ Graham, 1983, p. 43 . However,Keenan arguably takes Graham’s claim out of context. Graham is writingagainst a background of extensive debate, mainly among philosophers of

( )history rather than practising historians, as to what constitutes a goodhistorical explanation, and whether historical explanation is distinct fromscientific explanation3. Graham’s aim is to show that the philosophicaldebate over historical explanation has been needlessly complicated, andto put forward a ‘‘common-sense’’ criterion for an explanation’s being‘‘historical’’. He does not address the question of what in general termsconstitutes an explanation, only what makes an explanation ‘‘historical’’( )Graham, 1983, p. 52 . As Graham goes on to claim:

If I am right we have found reason to call a certain sort of explanationhistorical, but the historian is perfectly at liberty to reach for whatever

(form of explanation will suit his purposes Graham, 1983, p. 66, emphasis)added .

But is the historian obliged to reach for some form of explanation inorder to perform properly? This is the implication of Keenan’s argument.It is, though, one that sits uncomfortably with a broad conception of

(historical practice. Any research that does not intend to explain in)whatever sense would not be ‘‘proper’’ historical research. Thus at-

tempts to locate, document and transcribe archives would qualify as(historical research only if they sought to explain unless we argue

circularly that such work carried out in a ‘‘ true’’ historical spirit isinevitably explanatory whether or not those undertaking it have such an

)intention . If archival researchers in accounting history are, as Fleis-( )chman & Tyson 1997 claim, an endangered species, the threat comes

as much from Keenan as from M&N.[ ]How does Keenan reach his conclusions? His central assertion is: ‘‘ I f

it is true that to give an historical explanation of some phenomenon isto give its history, then there must be some necessary feature of therelationship between explanation and the conduct of historical research

( )which makes it true’’ Keenan, this issue, p. 650 . Note first of all thatKeenan has slipped from ‘‘giving a history’’ to ‘‘conducting historicalresearch’’. These are not the same, but as Keenan has not given adistinctive meaning to the latter expression, it is reasonable to assumethat the use of the different words merely constitutes an ‘‘elegantvariation’’ on ‘‘giving a history’’. But if that is the case, then Keenan’s

( )statement is simply wrong. Graham 1983, p. 52 warns that ‘‘no onecan ignore completely the integrated character of expressions like ‘his-torical explanation’ and determine to pay attention to one half of themonly.’’ This is just what Keenan does. The ‘‘necessary feature’’ of the

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relationship between giving a historical explanation of an event orphenomenon and giving that event or phenomenon’s history lies in the

(fact that a historical explanation ‘‘must contain... past events’’ Graham,)1983, p. 52 . ‘‘Giving a history’’ identifies a particular type of explanation

as ‘‘historical’’, it does not in itself constitute a particular type ofstatement as an ‘‘explanation’’.

Of course, to deny that history is necessarily explanation is not toclaim that history cannot be explanation, and indeed genealogists, evenif they do not explicitly use the word, often seek to provide explana-

( )tions of events and phenomena. Miller and O’Leary 1987 provide agood example of this. In the abstract to the paper, the authors statethat they are offering a ‘‘different interpretation’’ of the construction oftheories of standard costing and budgeting from that commonly found( )Miller & O’Leary, 1987, p. 235 , and to ‘‘interpret’’, according to a

(dictionary definition, is ‘‘ to explain the meaning of’’ Chambers English) (Dictionary, 1990, p. 746 . But if at least some genealogies of account-

)ing calculation are attempts to explain, perhaps they are not histories?Here, it is important to note the ambiguous nature of ‘‘history’’. As oneof the pioneers of the modern study of the philosophy of history, Walsh( )1967, p. 16 , observes, ‘‘ the word ‘history’ is itself ambiguous. It covers( ) ( )1 the totality of past human actions, and 2 the narrative or accountwe construct of them now.’’ This leads to potential problems of demar-cation in deciding whether say the application of economic or sociologi-cal theories to understand and explain events of the past might qualifyas ‘‘historical research’’ if this does not ‘‘give the history’’ of thoseevents in a way that Graham or Keenan would recognize. If, however,( ) ( )a the subject matter of research is ‘‘past human actions’’, and b theresearcher seeks to explain these actions, then either this would beenough to constitute the research as ‘‘historical’’, or more probably(because giving an explanation is, on Keenan’s account, a necessary but

)not a sufficient condition for giving a history there must be someadditional condition or set of conditions to be met that Keenan has notenunciated. Whatever view one takes on this point, Keenan’s argumentthat explanation is constitutive of historical research, so either ge-nealogists don’t understand history or they don’t practise history, isinvalid.

Evolution, Charge and Discharge and Double-Entry

Keenan suggests that M&N, in criticizing evolutionary models of expla-nation within accounting history, fail to distinguish between ‘‘ teleologi-cal’’ models of evolution and ‘‘natural selection’’ models. In a naturalselection model, accounting practices change as a response to externalchanges in the environment, under which certain practices are or be-come ‘‘ fitter’’ than others. In such a model, rational agency may play apart, in that individuals and groups may endeavour to develop andselect practices designed to achieve certain ends. However, stochastic


models of evolution are equally possible: here the use of practices isessentially random rather than a matter of rational choice, but thoseindividuals and organizations adopting the ‘‘ fitter’’ practices tend tosurvive where those adopting less ‘‘ fit’’ practices decline and eventuallydisappear.4 In a teleological model, evolution works towards some goalor end, and it is easy to characterize change as ‘‘progress’’5.

Keenan concedes that M&N’s ‘‘linkage... in their criticism of evolution-ary models of historical explanation between teleological processes and

( )necessary outcomes is unobjectionable’’ p. 652 . M&N were concernedto question approaches to historical research in accounting that took asgiven the proposition that accounting has changed in an inevitabledirection, so that the ‘‘ triumph of double-entry’’ may be regarded as thenecessary outcome of some historical process. Keenan grants this, butnonetheless wishes to preserve some role for nonteleological evolution-ary explanations. The broader concern that M&N had about this family

(of historical explanations even if M&N were wrong to characterize all)such explanations as teleological was that they tended to focus the

attention of the researcher on the ‘‘origins of the present’’ rather than( )on the ‘‘outcomes of the past’’ M&N, p. 632 . And it is certainly the

case that calls for evolutionary explanations have often taken somecurrent accounting phenomenon as the explanandum6. Keenan woulddoubtless point out that this is a matter of researchers’ practice ratherthan of research methodology, and is thus not a criticism of the evolu-tionary method as such, but the evolutionary method tends to constrainresearchers more fundamentally than in terms of the subject matter ofresearch. If practices emerge stochastically, the role for human agencyin accounting history becomes problematic. Yes, specific methods may

(be invented by or introduced by individuals and thus a search for)origins is encouraged , but their rationales and motivations become

secondary to a documentation of the practices themselves. Moreover,the explanation for adoption and survival of practices is found in their‘‘ fitness for purpose’’. But not only may such purposes be constitutedreflexively by the practices themselves, but the purposes are likely to behuman intentions explicable only in terms of motivations and rationales

( )that themselves emerge against a background or through a surface ofan ensemble of ideas, practices, techniques and beliefs that happen tobe located at a specific point in time and space.

The claim that evolutionary explanations in accounting history tend tounderexplain, that is, leave key questions unanswered, may be examinedby reference to Keenan’s own ‘‘evolution’’ of double-entry bookkeepingin England in the nineteenth century. Keenan’s argument goes some-thing like this: when double-entry appeared in Italy in the late MiddleAges, there was an alternative accounting method prevalent in England,

( )charge and discharge accounting CDA . The purposes for which CDAwas used were mainly the giving of accounts of how resources hadbeen received and used by agents acting on behalf of principals. CDAappeared initially in the context of the steward or bailiff of a manorial

( )estate accounting to his lord and master Noke, 1981 , but was also

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prevalent in the context of government administration at both national( )and local level Jones, 1985 . Although double-entry was known about in

England from at least the early fifteenth century, it was not widelyadopted until the nineteenth century. The reasons for its adoption were( )a it was better fitted to recording large volumes of transactions than

( )CDA, b the older system lost relevance with the move from personalagency relationships to more diffuse director]shareholder relationshipsassociated with the rise of the joint-stock company as the dominant

( )commercial form, and c double-entry was more ‘‘mysterious’’ than CDAand thus enabled the nascent accountancy profession to establish itself.

This is an interesting story, but it needs to be approached with somecare. First, it is arguable that CDA and DEB are different in nature: CDA

( )is a mode of financial reporting, but double-entry is at least principallya mode of recording transactions. Indeed, the systems, far from being

( ) 7alternatives, may be and in practice often were complements . This( )was recognized by economic historians such as Pollard 1965 , who

observed:

The master and steward system was based on the notion of stewardshipof the servant towards the proprietor or, later, the firm. As it haddeveloped in the Tudor period, after which it did not change essentiallyuntil the end of the eighteenth century, it was based on double-entrybookkeeping, but of a particular kind: on the debit side was the ‘charge’,or all the receipts of the agent on behalf of his master...; and on the

( )credit side the ‘discharge’, or all the payments made pp. 209]210 .

Now, it is arguable that Pollard took certain features of a double-entryledger, in particular the bilateral form of the account and the use of theterms ‘‘debit’’ and ‘‘credit’’, as equivalent to a full-blown double-entrysystem, and that the CDA records he studied were not substantivelydouble-entry in the sense of every transaction’s being recorded twice,once as a debit and once as a credit. However, several of those who

(have examined archives of CDA records from aristocratic estates for)example, Mee, 1975 and Raybould, 1973 have taken Pollard at his word

and identified CDA records as double-entry. More recent researcherswith some accounting experience have noted that an appearance ofdouble-entry in aristocratic estate accounts may simply be an artefact ofthe way in which the researcher views the archival material. For exam-

( )ple, Napier 1991 , in his discussion of the Glamorgan estate accounts of( )the marquesses of Bute 1814]1880 , presents financial statements that

(could easily have emerged from a double-entry system and indeedwhere at least one agent prepared rough double-entry style accounts to

)generate key totals but that were clearly statements of amounts forwhich the agent was accountable and of how the agent had dischargedhis responsibility.

( )An observation that Napier 1991 makes is that, on a large aristo-cratic estate, there could be a high volume of transactions, so thatsystems needed to be developed to deal with this. Double-entry in itselfhad no comparative advantage in handling large numbers of transac-


tions. Indeed, even in environments in which double-entry was adopted,the archetypal journal and ledger structure discussed in treatises as farback as Pacioli could not cope with the number of transactions withoutrecourse to subsidiary records. Granted, these could be regarded asintegrating into a systematic whole8, but it is unlikely that, for example,a nineteenth century freight clerk at a Great Western Railway goodsdepot, recording hundreds of bills of lading every day in a FreightOutward Book, would have experienced any significant change in termsof the efficiency of his operations, or sensed any variation in hispractices, whether such a book were integrated into a system ofdouble-entry or not.

The suggestion that those ‘‘on the ground’’ might have recordedtransactions in essentially the same way whether or not the record thatthey kept was part of a DEB or a CDA-based system might be argued

[ ]to miss the point of Keenan’s argument. This is that ‘‘ t he componentjournals, ledgers and balance sheet of a DEB system provided integratedsub-systems for recording, processing and reporting information whichwere better adapted to this changed circumstance of the accounting

[ ] (environment i.e. the increase in the volume of transactions ’’ Keenan,)p. 26, emphasis added . From this point of view, the use of DEB

recording technology to underpin a CDA reporting environment is evi-dence of the superiority of DEB at least for recording purposes. How-ever, the evidence relating to the use of DEB in typically CDA contextssuch as aristocratic estates is still slender, and it would be rash to drawdefinitive conclusions one way or the other at present.

Keenan’s second line of argument tries to avoid this potential problemby pointing to the ‘‘proliferation of joint stock companies with limited

( )liability in the second half of the nineteenth century’’ Keenan, p. 660 .Keenan argues that, in the joint stock companies, anonymous investorrelationships tended to take over from the more personal agency rela-tionships within which CDA flourished. These relationships gave rise toreporting needs that CDA was ‘‘ill adapted’’ to meet, while ‘‘DEB sys-

( )tems had no such difficulties of adaptation’’ Keenan, p. 660 . Keenan[ ]goes on to mention ‘‘ their i.e. DEB systems’ form of report’’, without

explaining what this was. Although he mentions the balance sheet, it isthe profit and loss account that is an integral part of a DEB system:while the balance sheet is based on the balances appearing in theledger, it is not an integral part in the same way as the profit and lossaccount. Whether by ‘‘ form of report’’ Keenan means the balance sheetalone, the balance sheet/profit and loss account combination, or some-thing totally different, it must be stressed that Keenan asserts rather

[ ]than demonstrates that this ‘‘ form of report’’ ‘‘accommodat ed the dis-persed and stratified rights of different classes of claimholders overbusiness assets’’ better than the CDA form of report.

( )Keenan might find some support in the arguments of Bryer 1993a ,who links the adoption of double-entry with the socialization of capital,arising initially in medieval Italy and spreading across Europe. Socializa-tion of capital is a central theme of the discussion offered by Bryer

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( )1993b of the emergence of ‘‘modern financial reporting’’ in Britaintowards the end of the nineteenth century. However, in this paper, Bryeris concerned to identify ‘‘modern financial reporting’’ not with therecording technology of double-entry but rather with cost-based accrualaccounting, that is, with the ‘‘ form of report’’. Here, the advantage ofdouble-entry over CDA might be that a profit and loss account is oftenan integral part of a double-entry system9, while a balance sheet maybe prepared directly from information recorded in a double-entry ledger.Thus the central statements of cost-based accrual accounting may beargued to emerge from a double-entry system in a more natural anddirect way than CDA statements emerge from a single-entry system. Butdouble-entry is neither necessary nor sufficient for cost-based accrualaccounting, as most of the allocations and valuations that are reflectedin such accounts need to be determined outside the bookkeeping sys-tem, even though they may ultimately be recorded in that system.

( )Moreover, as Bryer 1993b, pp. 654]665 discusses with reference todepreciation, nineteenth century professional accountants addressed theformalization of cost-based accrual accounting independently of the book-keeping system. A good example of this is given by Lawrence Dicksee,who prepared separate textbooks on Bookkeeping for Accountant Students( ) ( )1893 and Advanced Accounting 1903 , the former dealing mainly withrecord-keeping and the latter with the accounting statements. DEB wasby the middle to late nineteenth century a well-known technique, widelytaught in commercial schools, and an army of clerks could, by the endof the nineteenth century, draw up simple ledgers ‘‘ to trial balance’’ on

( )double-entry principles Kirkham & Loft, 1993 . Yet Keenan identifies DEBwith attempts of the emerging accountancy profession to ‘‘create a

( )mystique about their professional services’’ Keenan, p. 661 . As Keenanputs it, this line of argument seems to undermine his story regardingthe functional advantages of DEB. If DEB really were ‘‘esoteric’’ and

[ ]‘‘arcane’’, while ‘‘ the operation of CDA could be made intelligible to( )the illiterate’’ Keenan, p. 661 , then surely CDA would have had a

comparative advantage over DEB in the teaching of the army of latenineteenth century clerks. This is not to deny the possibility of profes-sional mystification, but it is suggested that it lay more in the measure-ment of asset values and the proper basis of depreciation and otheraccrual adjustments than in double-entry.

As Keenan is providing only a ‘‘sketch of an explanation’’, he cannotbe seriously criticised for not addressing every conceivable issue relatingto the emergence of DEB as a dominant bookkeeping system by thelate nineteenth century. The features he identifies are of significance,though not necessarily for the reasons that Keenan ascribes to them. Inany event, Keenan identifies a genuine research question: why didaccruals-based systems, centred on a profit and loss account or revenueand expenditure account, and often accompanied by a balance sheet,tend to supplant the reports of charges and discharges arising in localauthorities, estates and some businesses? In responding to this question,


a genealogist might proceed at a number of levels. One central issuerelating to the ‘‘genealogical approach’’ is whether its main focus is, orshould be, discourses or practices, even given their interdependency.

( )Armstrong 1994 has suggested that genealogical research in accountingreflects two ‘‘generations’’: the first generation emphasizing discoursesand viewing them through a Foucauldian ‘‘power-knowledge’’ lens( )Foucault, 1980 , while the second generation draws more from Foucault’s

( )studies of governmentality Burchell et al., 1991 , and embodies a ‘‘soci-(ology of translation’’ drawn from social studies of science Callon, 1986;

)Latour, 1987 . If Armstrong’s characterization of the genealogical( )method s is valid, then M&N might be criticized for failing to point out

how what is meant by ‘‘genealogy’’ in the four case studies theyprovided is a fluid notion. That there can be no unique genealogy ofthe transition to double-entry, however, does not prevent the sketchingout of areas in which a genealogical approach might differ from that ofKeenan.

The genealogist would focus not just on documenting the transitionfrom one system to another but would attempt to locate such a transi-tion within an ensemble of ideas, rationales, technologies and practices.For example, we know that there was, in the 1820s and 1830s, consider-

(able interest in Britain in ‘‘rational government’’ Gallhofer & Haslam,)1994a,b , including the more efficient conduct of local government. If it

was believed that double-entry was a particularly ‘‘rational’’ system ofrecord-keeping, then, given a setting in which government sought anddefined itself in terms of its rationality, the adoption of double-entrymight have been a proactive wish of legislators and both national andlocal administrators to instil attitudes to economy and efficiency in theminds of those responsible for local government, rather than a reactionto an increase in transaction volumes and a concomitant propensity to

( )the perpetration of frauds Coombs & Edwards, 1994 . A desire on thepart of the British Government to impose ‘‘efficient management’’ onOxford and Cambridge colleges appears to underlie the adoption ofdouble-entry systems of accounting by these entities in the late nine-

( )teenth century, after centuries of CDA Jones, 1991, 1994a,b . A ge-nealogist would attempt to tease out the discourses surrounding ac-counting within what it would be anachronistic to call the ‘‘publicsector’’, and might possibly identify that the very notions of economyand efficiency that were used to underpin the advocacy of double-entrywere conditions of possibility for enabling local government and similarbodies to think of themselves as falling within a public sector ratherthan as simply extensions of the landed gentry.

Similarly, the slow adoption of double-entry on aristocratic estates,where CDA based on structured single-entry recording systems still ap-pears to have been used on significant English estates as late as the

( )first two decades of the twentieth century Parker, 1975, p. 6 , and thepreparation of the ‘‘Account Charge and Discharge’’ was part of the

( )training of Scottish chartered accountants in the 1920s Baxter, 1980 ,may be partially explained by the late transition from aristocratic-rentier

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estate management to capitalistic farming. However, a genealogist wouldwish to probe behind this transition, which provides a functional expla-nation for a change in accounting method, to examine the extent towhich double-entry, and other accounting methods, were specifically ad-vanced in the agricultural context to achieve similar ends to those

( )proposed by Miller and O’Leary 1987 for standard costing in themanufacturing context. On some estates, double-entry was seen as im-posing structure on a hitherto haphazard and unco-ordinated set ofaccounting records. For example, on the estates of the earls of Dudley,which owned coal mines and ironworks as well as agricultural land,accounting changes took place as early as 1835, including ‘‘double-entryforms, capital accounting, and the breakdown of accounts to providespecific information such as net profit on individual concerns, adminis-trative expenses, debts outstanding, or receipts from investments’’( )Raybould, 1973, p. 231 . Yet, on similar contemporary estates, such as

( )those of the earls Fitzwilliam Mee, 1975 , full double-entry was notadopted, even though the estate accounts were prepared in bilateral,debit and credit, form. Again, it would be worth exploring whether adiscourse of efficiency was ‘‘ translated’’ into one of double-entry. Muchmore archival and analytic research needs to be done to form a roundedview of nineteenth century British aristocratic accounting, but it is likely

(that a genealogical approach will give a richer understanding and,)indeed, explanation than a simplistic evolutionary approach.

Conclusion

Rather than being rivals, traditional and genealogical approaches to ac-counting history complement each other. However, genealogical ap-

( )proaches, by explicitly aiming to understand accounting in the historicalcontexts in which it operates, provide a broader basis for determiningthe ways in which accounting ideas and practices emerge and influence( )often in subtle and indirect ways the operations and activities of wide

(elements of society. Critics of genealogical approaches such as Arm-)strong, 1994, p. 50, referring to Napier, 1989 are prepared to concede

that researchers adopting such a perspective ‘‘have usefully opened updebate on extra-accounting influences’’. Moreover, despite the claims of

( )Fleischman & Tyson 1997 , genealogical researchers in accounting have( )in general reflected the observations of Foucault 1984, p. 76 that

[ ]‘‘ g enealogy is gray, meticulous and patiently documentary’’, that it‘‘requires patience and a knowledge of details and it depends on a vastaccumulation of source material’’. At present, the documentary evidencerelating to the transition to double-entry in nineteenth century Britain isriddled with lacunae, so both evolutionary and genealogical histories of

(this event if indeed there was such an event of the rather simple form)sketched out by Keenan cannot but be tentative.

Keenan has drawn attention to some areas of equivocation in M&N(on the scope of accounting history and on whether evolutionary ac-


) (counts are necessarily teleological , but his main claim that M&N rejectexplanation and therefore that the methods they advocate do not lead

)to the practice of history does not hold up. Demarcation disputes as towhether genealogical approaches are history tout court or rather should

( )be designated as ‘‘historical sociology’’ Dean, 1994 are unlikely to befruitful10. Over the years, the academic study of history has provedflexible enough to absorb new notions of what constitutes evidence, ofwhat an appropriate subject matter might be, of how history might be

( )communicated. We might paraphrase M&N 1993, p. 631 by saying:‘‘There is no ‘essence’ to accounting history, and no invariant object towhich the name ‘accounting history’ can be attached.’’ However, thereare often shared criteria of what at any particular point in time consti-tutes ‘‘good’’ accounting history. Whether or not we agree with( ) [ ]Armstrong, 1994, p. 49 , that ‘‘ the genealogical method may demandthe same kinds of evidence as traditional biographical approaches to thehistory of innovation’’, genealogists of accounting see themselves ashistorians and are prepared to be judged as historians. If some seethemselves as more than historians, this does not negate the historicalvalue of their approach, nor the epistemological status of their work.

Notes

( ) (1. In a paper regarded as a ‘‘classic’’ Brown, 1996, p. 726 and as ‘‘seminal’’ Roslender,)1996, p. 547 .

2. The attention to rationales is only an emphasis and not an invitation to eschew a( )study of practices. As Miller & Rose 1995, p. 592 have recently observed, the goal is

‘‘an understanding... of the links between rationalities and technologies... and of theembeddedness of thought in the most prosaic aspects of social and economic life.’’

(3. This debate is summarized in a number of places for example, Atkinson, 1978, pp.)95]139 .

( )4. In the economics literature, this line of argument is associated with Alchian 1950 ,( )and is discussed at length by Nelson and Winter 1982 .

5. A recent interesting treatment of the notion of progress from the viewpoint of the( )philosophy of history is provided by Graham 1997 .

6. See for example the American Accounting Association’s Committee on Accounting( )History 1970 , which proposed nine possible research topics for accounting historians,

no fewer than eight of which contain the word ’’evolution‘‘.7. This can be explained within Keenan’s framework by asserting that DEB was used for

recording transactions precisely because CDA was defective for this purpose, whileCDA was still ‘‘ fit’’ for the purpose of reporting on the use of resources by a stewardor agent. It should be noted that Keenan’s references to specific occurrences of CDArelate almost entirely to the medieval period, while CDA persisted until well into thepresent century.

( )8. Jones 1985, p. 208 suggests that the double-entry approach implied a structure tyingtogether the various subsidiary books in a way that CDA was not capable ofachieving.

( )9. Yamey 1964, p. 134 notes that ‘‘ the characteristic components of the double-entry[ ]system are the profit and loss account and the capital account.’’ See also Parker

( )1996, p. 239 for a discussion of the problems of defining what actually constitutes adouble-entry system.

( ) [ ]10. As Callinicos 1995, p. 98 observes: ‘‘ I t is hard to draw a clear line of demarcationbetween a broad interpretive essay written by a historian and one produced by ahistorical sociologist: whatever their origins, whether only one has been sanctified bythe chrism of direct contact with the sources, both are subject to the same processof critical appraisal.’’

C. J. Napier698

Acknowledgements

I am particularly grateful to Michael Keenan for pointing out variouserrors in logic and interpretation in an earlier draft, and to DavidCooper for his comments. My thanks to Peter Miller for his commentsand suggestions on a preliminary version of this paper. The viewsexpressed in the paper are, however, my own, as are all remainingerrors.

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giving an account of accounting history: a reply to keenan

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