Pacioli Starts Bookkeeping with an Inventory

Luca Pacioli started the bookkeeping process by describing how to take an inventory of things. This is because financial reporting begins with the Balance Sheet. Although earnings gets all the attention in financial analysis, earnings and the Income Statement that documents it, is defined as a change between two Balance Sheets.

This week’s video discussed chapter 2 of Pacioli’s book about how to take an inventory. This is Episode 116 of Conversations with Kip, the best financial system vlog there is.

An English version of his book can be located here.  The full book can be accessed here. The accounting section begins on printed page 197 through page 210.

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