Growth of accounting Knowledge. Accounting knowledge ( principles , practices , systems) has grown much over the period of about 200 years from (1775-2000). (1775-1850):
1- Business firms , proprietary owners, were more interested in knowing their capital (Assets – Liabilities),emphasis on balance sheet during this period.
2- Assets were valued at current value.
The basic accounting principles and assumptions (operating guidelines) developed during this periods.
1- Growth of corporations between this period led the development of separate entity assumption . There was greater emphasis on income rather than on balance sheet .
2- This resulted in development of accounting concepts of income and the periodicity assumption.
3- A company was regarded as going concern; and fixed assets were valued at original cost less depreciation.
4- separate entity led to emphasis on auditing Financial statement by Charted accountants.
5- The revenue principles , the cost principles and the matching principles began to be applied in the construction of income statement.
6- Inventory and fixed assets began to be valued at historical cost due to stewardship reporting.
1-As for development of this period , stewardship reporting did not remain all that significant around 1950 . Cost accounting and management accounting development during this period .
2- Grater emphasis on financial statement for decision-making
3- Tax accounting , advising and planning were developed.
4- Auditing techniques , standers and guidelines were issued by the professional bodies.
5- Governmental accounting was improved upon to make it more useful in planning, budgeting and controlling.