GOLDEN ERA IN THE DEVELOPMENT OF ACCOUNTING THEORY

Abstract

The socio-economic environment in which the enterprise operates is constantly being transformed; accordingly, accounting must be functionally improved. Accounting theory is the basis of accounting science. It provides an opportunity to improve methodical support and accounting methods and expand business entities' capabilities to independently form internal carriers of accounting, economic, financial, social and other information. The article is devoted to disclosing the most famous accounting theories of the 15th-19th centuries (the golden era of accounting theories), which Professor Oleksandr Galagan classified. The study results show that over five centuries (XV-XX), accounting grew from a craft and art to a science due to the formation and development of own theories. The formation and development of the science of accounting in the theoretical aspect in this period significantly outstripped other components of economic science. In addition to developing the eight elements of the method, scientists paid great attention to the accounting mission in society, expanding its tasks and functions. It was found that the scope and depth of the development of accounting science during this period can be demonstrated by selecting the nine most vivid theories after the works of Luca Pacioli and Benedetto Cotrugli. All these accounting theories can be divided into two main groups: 1) metaphysical accounting theories; 2) positive accounting theories. It was found that all the founders of accounting theories positioned accounting as an essential component of economic science, the so-called “mind” in managing the firm and the state. The research results show that Professor Oleksandr Galagan classified accounting theories regarding teachings that explain this type of activity from certain laws accepted by humanity. In his opinion, the highest among these accounting theories were the laws of nature. It has been proven that accounting theory should be the basis for the development of accounting science. The provisions of the accounting theories identified in the study will substantiate the further development of accounting science on the laws of causality characteristic of other sciences to form an accounting theory relevant today.