The history of accounting dates past the 15th century (Jones, 2014). People would hire accountants to monitor their assets, in exchange for a small fee. At first glance, a person would not expect something as mundane as accounting and tax management to be mentioned in the Bible, but as always, God surprises us with His knowledge of our modern way of life. The Bible sets out clear guidelines for accounting ethics and how accountants are to conduct themselves, which are where the secular view of accounting gets its routes. The Bible mentions the fields of internal control, financial accounting, and management accounting (Jones, 2014). Financial accounting often serves to purpose of ensuring that one’s assets do not fall victim to fraud by either the outsiders or by its agents (Jones, 2014). Financial accounting also serves the purpose of monitoring management pre-performance. The Bible casts a negative light on this form of accounting with the discussion of the Temple building. The Bible states that no accounts were kept of the money paid to any of the men or of the money that was paid to the workmen of the Temple because they were honest in their dealings. The verse 2 Kings 22:7 takes a similar tone when it states, “But they need not account for the money entrusted to them, because they are honest in their dealings.” (2 Kings 22:7, New International Version). It is quite easy for us to infer from these two verses that the Biblical view of financial accounting is that it is unnecessary as long as all parties are honest in their financial affairs. We can also infer that the Bible views financial accounting as needed at times when it is necessary to counteract fraud. Luke 16:2 suggests that the Bible talks about monitoring agents or financial accountants. The verse talks of a man who hears rumours that his accountant is wasting money. The Bible states in this verse, “What is this I heard about you? Draw me up an account of your stewardship.” (Luke 16:2, New International Version). In Biblical times, financial accounting was used as a device to monitor performance of assets, and the Bible suggests in this verse that the owner of the account should have requested reports of the agent’s accounting process. These reports would have allowed the owner of the account to detect early on that his accountant was being dishonest (Jones, 2014). The Bible also states that financial accounting is a useful way of keeping peace between debtors and creditors, as financial accounting creates a way for all parties to agree upon the amount to be paid (Jones, 2014). Ecclesiasticus 4:1-2 is an example of this view when it says, “These are things you should not be ashamed of—keeping strict accounts with a traveling companion.” (Ecclesiasticus 4:1-2, New International Version).
The Bible discusses in detail the modern accounting field of internal control, as cash was used in large amounts and it was paramount that there be some control over the goings on (Jones, 2014). The Bible suggests dual custody of liquid assets, limited access to one’s assets, and separation of duties between the accountant and the owner of the assets. It is from these ideas that we derive our modern ideas and ethics for internal control (Jones, 2014). The rationale for modern and Biblical internal control comes from the view that if an employee (or in this case an accountant) is able to steal from one’s assets, then they likely will. We get this rationale from the verse Micah 7:5-6, “Put no trust in a neighbor, have no confidence in a friend.” (Micah 7:5-6, New International Version). This statement also suggests that auditors and accountants should have a degree of skepticism in their dealings (Jones, 2014). This brings our discussion to how the Bible uses as an example the Israelites of this time practicing the dual custody of assets as a method of internal control (Jones, 2014). 2 Chronicles 24:11-12 paints us a clear picture of this practice when it states, “whenever the chest was brought in by the Levites to the king’s officials and they saw that there was a large amount of money, the royal secretary and the officer of the chief priest would come and empty the chest and carry it back to its place. They did this regularly and collected a great amount of money. 12 The king and Jehoiada gave it to those who carried out the work required for the temple of the Lord. They hired masons and carpenters to restore the Lord’s temple, and also workers in iron and bronze to repair the temple.” (2 Chronicles 24:11-12, New International Version). 2 Corinthians 8:16-17 tells us that those who act as the agents of funds should exhibit high levels of integrity, “But thanks be to God who puts the same earnestness on your behalf in the heart of Titus. For he not only accepted our appeal, but being himself very earnest, he has gone to you of his own accord.” (2 Corinthians 8:16-17, New International Version). St. Paul speaks further of these men’s virtue and integrity in 2 Corinthians 8:20, “We hope that in this way there will be no accusations made about our administering such a large fund; for we are trying to do right not only in the sight of God but also in the sight of men.” (2 Corinthians 8:20, New International Version). These three passages reflect the modern view that dual custody of assets is necessary to reduce the risk of fraud, and the modern principle of internal control that honest employees are necessary for any system (Jones, 2014). One of internal control’s most integral principles is the need to physically protect assets by locking them up as to prevent anybody from attempting to steal them. Even this most basic principle is highlighted in the Bible by the verse Ecclesiasticus 42:6-7 where it states, “Where there are many hands, lock things up.” (Ecclesiastics 42:6-7, New International Version). This verse also reflects the view that people will be likely to steal if given the opportunity (Jones, 2014), that was discussed at the beginning of this section.
Our last sections brings us to the discussion of the Biblical view of managerial accounting. The Bible often speaks about the important of creating realistic budgets and of the importance of full participation in the budgeting process. In addition to this, the Bible also offers us advice on how to correctly evaluate a product (Jones, 2014). Luke 14:28-29 discusses the important business planning topic of creating a budget, “Which of you here intending to build a tower would not first sit down and work out the cost to see if you had enough to complete it?” (Luke 14:28-29, New International Version). This passage not only speaks to the budgeting process, but also to the aspect of cash flow forecasting (Jones, 2014). It is through passages like this that we can truly appreciate how much God knows about our way of life, and that in actuality, our modern way of life is not as unlikely life in biblical times as we might imagine. The Bible discusses the importance of all parties participating fully in the budgeting process in Proverbs 15:22, “Without deliberation plans came to nothing, where counselors are many, plans succeed.” (Proverbs 15:22, New International Version). When we imagine these “counsellors” as sub-unit managers, this verse is consistent with the principle of participatory budgeting (Jones, 2014).
The Bible provides important examples for how we are to live our lives, even in these modern times. God has even set out clear guidelines for how we are to conduct ourselves in our financial lives. The Lord knew that this would be a difficult area for us to manage, and so He has used the Bible as a way for us to manage our finances. In the field of accounting we can take many ques from the Bible as to how we are to manage our affairs and our clients’ assets. If we follow closely the rules set out for us in the Bible, then we are sure to find success in the realms of finance and accounting.
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