Accounting for people: a short history

The necessity of accounting for people was first recognised in the 1920s when Paton, one of the first generation of accounting theorists, questioned the credibility of a balance sheet from which “a well-organized and loyal personnel” was absent. However, it was only with the emergence of social accounting forty years later that the challenge of accounting for people was fully engaged. As a result it became one of the hottest research topics in accounting in the mid 1970s. In the absence of any significant breakthrough, the topic fell from favour by the end of that decade, becoming only a minority interest for almost two decades. Following the emergence of the complementary intellectual capital and knowledge management fields in the mid 1990s, a growing number of accounting researchers have concluded that prospects for accounting for people have been greatly enhanced.