What major contributions to accounting and its terminology have been

made historically by the following countries: Italy, the United Kingdom, the United States, and Japan?

hroughout history, many countries have developed their own mode of accounting. Certain countries, more than others, have made significant contributions to the development of accounting and its terminology. In the 1400s, it was common practice for merchants in Venice (Italy) to record their transactions using a dual system whereby each transaction is recorded using two accounts that offset each other. It was later documented and later spread to the whole world by the observation and writing of Franciscan monk and Mathematician Luca Pacioli. Established as double-entry bookkeeping in his famous work Summa, his explanation of the accounting cycle (ranging from bookkeeping and profit calculation) was spread throughout Europe and later the whole world. It also became the foundation of modern accounting. Realizing the importance of regulatory bodies to standardize accounting practices, professional bodies including the Institute of Chartered Accountants in England and Wales (ICAEW) and the Association of Chartered Certified Accountants (ACCA) were established in the United Kingdom. These bodies also act as a framework guideline for accountants to refer to in performing their daily responsibility of preparing the financial statements. This avoids the accountants using solely their personal judgement and thus making the information and financial statements prepared incomparable to that of other accountants preparation. The United States has dominated the worlds economy for the longest time, notably after the World War II. During the period of 1950s to the 1970s, American companies thrived on producing a large number of goods and selling it to the market quickly in order to achieve profits. However, in the 1980s the Japanese began to take the markets by selling low number of goods which were of high quality. With the added pressure to reduce costs in order to increase profits, American companies began to employ Activity Based Costing; a concept that allocated costs based on the level of activity performed. This method of costing has brought on many benefits in the field of management accounting, for budgeting and thus has led to its wide spread of use to companies all around the world. Meanwhile in Japan, the 1970s saw the rise of a management philosophy known as Just In Time (JIT). Perfected by the Taiichi Ohno (Referred to as the father of JIT), in Toyota manufacturing plants as a means to meet consumer demands with minimum delay. JIT benefits the organization by minimizing waste in order to maximize profits. It also emphasizes on improving product quality and the efficiency of production. Common use of JIT is in managing stock so that they arrive just in time to be used by the respective department in order to minimize holding costs. JIT is aimed at organizational simplicity, eliminating redundancy and prevention of wastage.

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