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> I thought the benefit of double-entry was that it make fraud and inconsistencies easier to catch, not detection of profit per se One of the key principles of
by Alex3917 4y ago
> I thought the benefit of double-entry was that it make fraud and inconsistencies easier to catch, not detection of profit per se
One of the key principles of double entry accounting is denominating profit and loss in a fungible currency, rather than just recording the number of goats you own or whatever. Double entry is actually the codification of several different best practices, it’s more than just having two sides of the ledger. But even with just the fraud part, you are very limited on the number of employees you can have if you don’t have any way to know if they’re stealing from you. That’s why even though e.g. Ancient Rome had thousands of fast food restaurants, they didn’t have franchises like McDonalds.
- amscanne 4y agoPoppycock. Ancient Rome and Ancient Greece both had plenty of sophisticated bookkeeping and accounting methods — I don’t think you can even point to a single moment in time when double entry was “invented” (just standardized or popularized). There are many reasons that they didn’t have McDonalds-like franchises, and none of them have to do with accounting. Those kinds of franchises didn’t exist in the modern world until the 20th century; they are product of many elements of modern culture (and modern approaches to business). What the heck would a franchise even do for someone in Ancient Rome? It’s not like there are massive chicken suppliers or industrial-scale bakeries that produce standardized food products to sell. Every restaurant needs to source local suppliers directly anyways. Fast food chains make no sense without industrialization, among many other things (bookkeeping being the least of them).
- thom 4y agoYou could (somewhat weakly) argue that Roman publicani were a form of franchise.