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Accounting has evolved as human beings have evolved and as the concepts of the accounting subject are directly coined from its most fundamental principle of conservatism, it is not difficult to see why the style of accounting at every point in time has a direct link with this. As man is rolling out from a primitive age to a modern interdependence age, living has advanced from being subsistent as a hunter-gatherer to an understanding driven globalised world concept of ‘effectiveness embracing greatness’ and all additionally evolution, self accounting with the abacus is rolling out through stewardship accounting to financial accounting and today managerial accounting; which has a concentrate on decision making.

The Financial Accounting Standards Board (FASB) of the united states which generally standardised and strengthened the globally adopted Generally Accepted Accounting Principles (GAAP) took significant strides in the year 2012 to come alongside the International Accounting Standards Board (IASB) in a manner referred to as ‘International Convergence’. Such a convergence is likely to gradually harmonise the GAAPs and the IFRS until they become one and exactly the same in a bid to stream line corporate/company reports into a uniform process globally.

1.1 Statement of the Problem

There is no absolute certainty as to what the near future holds for the Accounting Profession. It thus seems however, that the future age which definitely would be one of scientific advancement, would move man from greatness to something worthier for the time. Spiritualism, Environmentalism and Developmentalism could be key factors in the foreseeable future age. This paper is to find out if Accounting itself will be more of a reality providing accurate answers to financial problems where man’s ability to value natural capital fairly would give rise to a significant asset on the total amount sheet in contrast to the industrial age when even man himself was regarded as labour and not being considered as important because the machines he operated.

2. LITERATURE REVIEW

This paper was approached from a content analysis view point – both conceptual and relational. A content analysis is “a research technique for the objective, systematic, and quantitative description of manifest content of communications” – (Berelson, 52). The conceptual analysis was only to examine the presence of the issue, i.e. whether you will find a stronger presence of positive or negative words used with respect to the precise argument while the relational analysis built on the conceptual analysis by examining the relationships among concepts. Much like various inquiry, initial choices with regard to what is being studied determined the chance of this particular paper.

2.1 Evolution of Accounting Theory

In accordance with investopedia.com, Accounting Theory in the light of its evolution can be defined as the overview of both historical foundations of accounting practice as well as the way in which accounting practices are verified and put into the analysis and application of financial principles. Accounting as a discipline is believed to have existed because the 15th Century. From that time to now businesses and economies have continued to evolve greatly. Accounting theory must adapt to new ways of doing business, new technological standards and gaps that are discovered in reporting mechanisms hence, this can be a continuously evolving subject. As professional accounting organisations help companies interpret and use accounting standards, so do the Accounting Standards Board help continually create better practical applications of accounting theory. 會計審計 Accounting is the foundation of efficient and effective business management and intelligent managerial decision making, without which businesses and trade world-wide would operate blindly and fatally. Hence, it is necessary to link how it has evolved to its future role.

2.2 The Origin of Accounting

Luca Pacioli wrote a Maths book in 1494 (ehow) that consisted of a chapter on the mathematics of business. As this book is thought to be first official book on accounting, Luca Pacioli has severally been thought to be ‘the father of accounting’. In his Maths book, Pacioli explained that the successful merchant needed 3 things: sufficient cash or credit; an accounting system that may tell him how he could be doing; and an excellent book keeper to operate it. Pacioli’s theory still holds today, it included both journals and ledgers and it is believed to have popularised the usage of the double entry accounting that had been in place because the late 1300s.

2.2.1 The First Change in Accounting



During the depression of 1772, the Accounting profession went beyond book keeping to cost accounting. The theory and the idea were transformed right into a method determining whether a business is operating efficiently or utilizing an excess of labour and resources. The new theory of cost accounting allowed a trained book-keeper or an accountant to utilize the book kept to extract financial reports to show the efficiency represented by such data. This new idea led to the survival of businesses through the depression; business that would otherwise have failed without an intelligent management decision making informed by a cost accounting breakthrough.

2.2.2 The American Revolution/ British Courts Influence

The end of the American Revolution saw the initial United States (US) governmental accounting system being created in 1789 and it was established to account for and manage the treasury of the US. The double entry practice and theory were adopted. The British courts ruled they needed professional accountants to create financial information with regards to court cases. Chartered accounting bodies/ concepts were introduced in Britain (and in the US in particular, the Certified Public Accountant – CPA). In 1887, the first standardised exam emerged with Frank Broaker becoming US’s first CPA.

2.3 Modern Cost Accounting

This was first established by General Motors (GM) Company in 1923 and it developed methods that helped cut its costs and streamlined operations which remained relevant for over 50 years. The brand new accounting techniques developed included return on investment, return on equity and GM’s flexible/adjustable budget concept.

2.4 Accounting Concepts and Conventions

This was established in US between 1936 and 1938 by the Committee on Accounting Procedure (CAP) thereby standardising Accounting practices for several companies through the entire US. In 1953, the Generally Accepted Accounting Principles (GAAP) was updated to new standards, CAP became Accounting Principles Board (APB) in 1959 and later in 1973, APB (having experienced poor management) was replaced by Financial Accounting Standards Board (FASB) with greater powers and opinion for its professional stance.

2.5 International Financial Reporting Standards

FASB issued almost 200 pronouncements between 1973 and 2009 thereby establishing the foundation of Accounting Standards in use presently and is now making current moves to harmonise all accounting principles of GAAP with the International Financial Reporting Standards (IFRS) of the International Accounting Standards Board (IASB). It is widely believed that development of accounting profession in any nation and around the world is a mixed effort of both accounting theoreticians and practicing accountants. Thus, the framework of accounting is a harmony of efforts whereby professional accounting bodies are usually in the lead of a way to regulation and standardisation of issues associated with accounting.

2.6 The Nigerian Scenario

In Nigeria, the case is not different from what was already discussed. Almost all of the country’s accounting standards (concepts and conventions) were inherited from the British colonial masters. And as the world has indeed turn into a large global village with globalised accounting bodies supervising and making sure that all member countries are abreast with current Generally Accepted Accounting Principles, Nigeria has also tagged along making several public sector and private sector reforms the newest and famous which include the approval by the Federal Government in July 2010 to adopt International Public Sector Accounting Standards (IPSAS) for the general public sector and the International Financial Reporting Standards (IFRS) for the private sector as a conscious effort to make sure a uniform chart of reporting system through the entire country by both public sector and private sector.