Advertisement

The Determination of Profit in Medieval Times

  • Alan Sangster
  • Mikhail KuterEmail author
  • Marina Gurskaya
  • Angelina Andreenkova
Conference paper
Part of the Advances in Intelligent Systems and Computing book series (AISC, volume 724)

Abstract

This paper presents the results of research into the early practices adopted to identify financial performance. Focusing on the Pisan account books of Francesco Datini from 1383–1386, it reveals the special features of the calculation of profit or loss on each transaction. This, in its turn, is consolidated into the calculation of the overall profit or loss. This consolidation step was performed by transferring these profits and losses into a mercanzie account, literally, a merchandise account. All other income and expenditure that did not form part of a venture or a consignment was also transferred to this account. When balanced, it revealed the net profit for the period, just as today we find that in the statement of profit and loss, or income statement. The sophistication of the approach demonstrates the high level of the accounting culture in this medieval business, and suggests that this early precursor of the modern profit and loss account may have emerged earlier than the concept of a Trial Balance, rather than simultaneously as has previously been thought.

Keywords

Financial performance Determination of profit “Profits and losses” account Trial Balance The Datini company 

References

  1. Bensa, E.: Francesco di Marco Datini: discorso detto nell’Aula maggiore del Comune di Prato il dì 21 agosto 1910. ARTI GRAFICHE CAIMO & C, Genova (1923)Google Scholar
  2. Bensa, E.: Le forme primitive della polizza di carico: ricerche storiche con documenti inediti. Caimo, Genova (1925)Google Scholar
  3. Bensa, E.: Francesco di Marco da Prato. Notizie, e documenti sulla mercatura italiana del secolo XIV, Treves, Milano (1928)Google Scholar
  4. Besta, F.: La Ragioneria, vol. 3, 2nd edn. Rirea, Rome (1909). Facsimile Reprint, 2007Google Scholar
  5. Carradori, A.: Francesco di Marco Datini, mercante pratese del sec, vol. XIV, Prato (1896)Google Scholar
  6. Ceccherelli, A.: I libri di mercatura della Banca Medici e l’applicazione della partita doppia a Firenze nel secolo decimoquarto. Bemporad, Firenze (1913)Google Scholar
  7. Ceccherelli, A.: Le funzioni contabili e giuridiche del bilancio delle società medievali. Riv. Ital. Ragioneria 14(8), 371–378 (1914a)Google Scholar
  8. Ceccherelli, A.: Le funzioni contabili e giuridiche del bilancio delle società medievali (Continuazione e fine). Riv. Ital. Ragioneria 14(10), 436–444 (1914b)Google Scholar
  9. Ceccherelli, A.: l linguaggio dei bilanci: formazione e interpretazione dei bilanci commerciali. Le Monnier, Firenze (1939)Google Scholar
  10. Corsani, G.: I fondaci e i banchi di un mercante pratese del Trecento: Contributo alla storia della ragioneria e del commercio: da lettere e documenti inediti. La Tipografica, Prato (1922)Google Scholar
  11. de Roover, R.: The development of accounting prior to Luca Pacioli according to the account-books of Medieval merchants. In: Littleton, A.C., Yamey, B.S. (eds.) Studies in the History of Accounting. Sweet & Maxwell, London (1956)Google Scholar
  12. Del Lungo, I.: Francesco di Marco Datini mercante e benefattore. Giaclietti, Prato (1897)Google Scholar
  13. Guasti, G.: Ser Lapo Mezzei, lettere di un notario a un mercanto del secolo XIV, Florence (1880)Google Scholar
  14. Kuter, M., Gurskaya, M., Andreenkova, A., Bagdasaryan, R.: The early practices of financial statements formation in Medieval Italy. Account. Hist. J. 44(2), 17–25 (2017)CrossRefGoogle Scholar
  15. Kuter, M., Gurskaya, M., Bagdasarian, R., Andreenkova, A.: Depreciation accounting in Francesco Datini’s companies. In: 5th International Conference on Accounting, Auditing, and Taxation (ICAAT 2016) (2016).  https://doi.org/10.2991/icaat-16.2016.26
  16. Livi, G.: Dall’Archivio di Francesco Datini mercante pratese. F. Lumachi, Firenze (1910)Google Scholar
  17. Melis, F.: L’archivio di un mercante e banchiere trecentesco: Francesco di Marco Datini da Prato. Moneta e Credito, VII (1954)Google Scholar
  18. Martinelli, A.: The Origination and evolution of double entry bookkeeping to 1440. ProQuest Dissertations & Theses Global pg. n/a (1974)Google Scholar
  19. Nicastro, S.: L’Archivio di Francesco di Francesco di Marco Datini in Prato (1914). Rocca S. Casciano, L. CappelliGoogle Scholar
  20. Nigro, G.: Francesco di Marco Datini: The man the merchant. Firenze University Press, Firenze (2010)Google Scholar
  21. Origo, I.: The Merchant of Prato, Francesco di Marco Datini. London, J. Cape (1957)Google Scholar
  22. Zerbi, T.: Le Origini della partita dopia: Gestioni aziendali e situazioni di mercato nei secoli XIV e XV. Marzorati, Milan (1952)Google Scholar

Copyright information

© Springer International Publishing AG 2018

Authors and Affiliations

  1. 1.University of SussexBrightonUK
  2. 2.Kuban State UniversityKrasnodarRussia

Personalised recommendations