Let’s get fiscal

Nury Vittachi
There’s a lot to learn from Asian accounting – past and present – says Nury Vittachi

Old writer is a newcomer to us

Nury Vittachi

Hong Kong’s humorist on the true origins of accounting, and the uncanny similarities between bookkeeping and magic

Start saving. Sellers of a rare medieval accounting book want to sell it to one of us here in Hong Kong for HK$11.7 million. And it doesn’t even have pictures.

Auction house Christie’s is bringing the book, Summa de Arithmetica, to show around in Hong Kong in May – a month before a global auction in New York.

Apparently the auctioneers believe that Hong Kongers, out of all the people in the world, are folk of taste and refinement who love a good book.

Clearly Christie’s advisors have never been here.

Hongkongers don’t buy printed publications unless they include racing tips or images of models – and I seriously doubt Summa de Arithmetica has reasonable coverage of either of these two must-have elements.

A third thing we like is celebrities.

Author Luca Pacioli is not exactly J.K. Rowling, but is “recognized as the father of accounting and bookkeeping,” Wikipedia says.

Hmm. If Wikipedia says he is, it pretty much proves he isn’t.

This columnist had to study Pacioli’s book some years ago, and the author clearly says that he didn’t invent the financial techniques in the book, but collected them from the East.

The time has surely come for Asia to point out to Wikipedia and everyone else that we invented accounting, not westerners.

Business people in China and India have been doing handwritten accounting documents for millennia, and some places still use the abacus, arguably the first portable calculator.

One 2,000-year-old double-entry bookkeeping system, Bahi-Khata, is still used in India today, and the key documents probably still have the original curry stains on them.

Besides, Asian accounting is not just older, but arguably more creative than the dry Western equivalent, anyway.

Ours has added mystical elements, for a start. Example: every Diwali, Hindu businesses from Hong Kong to India to Bali to Singapore perform a rite called the Prayers to the Account Books, in which blessings are aimed at the business ledgers. These days, people install Quickbooks or some other piece of financial software onto their computers and then do meditational prayers, similar to a Puja ceremony around their laptops. (I am not making this up.)

Secondly, elite people in Asia often require accountants to make sure the final numbers are not just accurate, but are lucky too: surely a big plus to all concerned.

You can see that happening in Hong Kong, but it’s hard to picture it taking place at some big company in the United Kingdom.

Accountant: “Profit after tax this year is £94 billion, chairman.”

Bank chairman: “Oh no! I’ll need you to lose £6 billion pronto to make it a lucky £88 billion.”

Accountant: “Sir?”

In 1977, a researcher famously compared “uses made of accounting by modern societies with the use of witchcraft in less advanced ones.”

The study by Trevor Gambling found the two areas of expertise to have much overlap. Both magic and accounting involve the collection of data, the processing of multiple elements into a coherent whole, the employment of specialized jargon, the interpretation of results, etc.

In particular, accountants and witchdoctors spend much of their time finding ways to “accommodate awkward facts in a way which does not undermine the fundamental beliefs of the culture,” he wrote. Witchdoctors announce their final results by dressing up in feathers and splashing chicken blood around, while we announce ours by dressing up in Prada and shaking bottles of champagne. Same thing really.

So I would conclude that Pacioli’s text is important in European terms, but in the multi-millennia history of accounting in Asia, it’s just a recent bit of mass-market fluff. 

Maybe we should keep our HK$11.7 million for wiser purchases, such as a Feng shui-channelling waving arm cat to increase good fortune for our offices. One has to be scientific about these things, you know.

Nury Vittachi is a bestselling author, columnist, lecturer and TV host. He wrote three storybooks for the Institute, May Moon and the Secrets of the CPAs, May Moon Rescues the World Economy and May Moon’s Book of Choices

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