The rise of cost accounting: evidence from Italy

Abstract

Accounting historians link the origins of cost accounting to the rise of manufacturing firms and, in a more detailed way, to efficiency control, pricing and decision-making problems faced in those organizations. To date, the international debate has mainly focused on practices in the USA, Great Britain and France, with little evidence available of developments in other countries, such as Italy. In this paper, the authors analyse the development of cost accounting in an Italian firm, 'La Magona d'Italia'. This iron, steel and tinplate firm, situated in Piombino, is observed over the period 1865-1940, i.e. during the central phase of the industrial revolution in Italy. We find that several factors influenced the implementation of a cost accounting system at Magona, including efficiency control, strategic decision making, and stock valuation. We also find a strong British influence on Magona's strategy, organization and information system, particularly in respect of finance, managers, technology and accounting practices. There is little evidence that Italian accounting traditions and practice played much of a role.Origins Of Cost Accounting, Italy, La Magona D'ITALIA, Tinplate Manufacture, British, Influences,

Análisis histórico-contable de la sociedad Trenor y Compañía (1838-1926)

“…Los objetivos de la inform ación de costes en e sta em p re sa e ra n principalm ente la asignación de los costes por actividad p a ra d ete rm in a r su resu ltad o , así com o la valoración y el control del inventario. E stos objetivos son sem ejan tes a los obtenidos por Boyns y E dw ards (1996) en el contexto británico, la coordinación y control de los diferentes d e p artam en to s o secciones de la com pañía, y la to m a de decisiones estratégica; así como los de Antonelli et al (2002) en el contexto italiano, p a ra quienes el control de la eficiencia productiva, la to m a de decisión estratég ica y la valoración de stocks fueron los objetivos de la inform ación de costes que ellos d etectaron.…”

The History of Management Accounting in France, Italy, Portugal, and Spain

“…This bifurcated research pattern explains the contention of Antonelli et al (2005) that "outside of the activities of the state-run Venice Arsenale in the seventeenth century … few published works have examined costing activities in Italian industrial enterprises since the seventeenth century" (see also Bergamin Barbato et al, 1996). Consequently, Italian investigations into the history of management accounting have been relatively sparse until quite recently (e.g., Antonelli et al, 2002Antonelli et al, , 2005Cinquini and Marelli, 2002).…”

“…Such investigations have focused on the role of cost management in the increasingly competitive environments featured by that country from the second half of the nineteenth century. Antonelli et al (2002) examined the records of La Magona d'Italia, a firm that operated in the iron, steel, and tinplate industries. La Magona implemented a cost accounting system that aimed to calculate production costs for purposes of inventory valuation, price setting, and, in situations of market competition, support for efficiency improvements.…”

Multiple Origins of Accounting? An Early Italian Example of the Development of Accounting for Managerial Purposes

“…However, as noted by Brambilla and Conti (2005, p. 2), the relationship between accounting and the development of industrial businesses in 19th-and early 20th-century Italy is still largely unknown. Indeed, only two works have previously examined such issues: Antonelli et al (2002) have examined accounting issues in relation to the iron and steel manufacturer, La Magona d'Italia, at the end of the 19th/ beginning of the 20th century, while Antonelli et al (2005) have considered developments at the engineering conglomerate Ansaldo in the first half of the 20th century.…”