A Late Nineteenth Century Contribution to the Theory of Depreciation

Abstract

The unrecognized dispute in the theory of depreciation is whether too much or too little has been written on the subject. In 1957, Davidson began an article, "Depreciation is probably the most discussed and most disputatious topic in all accounting." 1 In the first (1912) edition of his Depreciation and Wasting Assets, P. D. Leake began, "Because it closely concerns Profit and Loss, the subject of Depreciation and Wasting Assets is of universal importance, and yet it has hitherto received little or no systematic attention." 2 One might suppose, then, that during the 45 years between these observations most of the discussion appeared. But this supposition is wrong. In 1890, a remarkable paper by O. G. Ladelle appeared in which the first two sentences were, "Depreciation is a subject on which we have of late heard much. Much has been written, and said, upon the necessity of taking account of it, and also upon the different ways in which this may be done." I To my knowledge, no attention has been paid to this article by Ladelle; I can find no references to it.4 I contend that Ladelle made a great contribution to the theory of depreciation and that much commentary could