Leonardo da Vinci’s friend Luca Pacioli is considered to be the father of accounting, but could the old Franciscan friar have left behind some tantalizing clues in his 1494 book that would predict the future of accounting as we now know it more than five centuries later?

Pacioli’s “Summa de Arithmetica, Geometria, Proportioni et Proportionalita” (“Everything about Arithmetic, Geometry and Proportion”) contains 36 chapters on bookkeeping, entitled “De Computis et Scripturis” (“Of Reckonings and Writings”) covering subjects as diverse as debits and credits, trial balances, assets, liabilities, income and expense accounts.

But could those 36 chapters eerily foreshadow IAS 36, the International Accounting Standard on the impairment of assets, which outlines the procedures that an entity should apply to ensure that its assets are carried at no more than their recoverable amount? We will never know, but the impairment of assets such as bank loans is a subject roiling the accounting world today, splitting the International Accounting Standards Board from the U.S. Financial Accounting Standards Board. Could Pacioli have foreseen this conflict in Renaissance Italy only two years after Columbus’s discovery of America?

Pacioli first met Da Vinci while he was teaching in 1497 at the court of the Duke of Milan. Pacioli taught Da Vinci about the laws of perspective and proportion, and Da Vinci illustrated Pacioli’s manuscript “De Divina Proportione” (“Of Divine Proportions”), which helped Da Vinci fashion some of his masterpieces, including “The Last Supper,” where he depicted a table with 13 guests. Could this have corresponded to the 15 members of the IASB, minus two (Da Vinci and Pacioli)? Perhaps future historians and symbologists will be able to tell us the answers.

A painting that we have of Pacioli attributed to Jacopo de Barbari shows him standing at a table filled with geometrical tools and models, including a rhombicubotahedron half-filled with water. Da Vinci illustrated the rhombicubotahedron as one of the pictures in “De Divina Proportione,” one of the earliest books printed after Gutenberg fashioned his printing press with movable type.

The geometrical shape has been described as an Archimedean solid with eight triangular and 18 square faces. Could this correspond with FASB Accounting Standards Update 2010-18, “Effect of a Loan Modification When the Loan Is Part of a Pool That Is Accounted for as a Single Asset,” where on page 8, we find the reference, “As a result of the amendments in this Update, modifications of loans that are accounted for within a pool under Subtopic 310-30 do not result in the removal of those loans from the pool even if the modification of those loans would otherwise be considered a troubled debt restructuring.”

When Louis XII of France invaded Milan in 1499, forcing Pacioli and Da Vinci to flee from the duke’s court, Pacioli’s outstanding debts too must have needed to be restructured.

Pacioli was called to Rome by Pope Leo III in 1514 to become a teacher and is thought to have died three years later in a monastery in Sansepolcro. While there, perhaps he also originated some of the accounting standards we know today. His friend Leonardo died two years later after completing the Mona Lisa and many other famous works.

Scholars have wondered for centuries what the mysterious subject of the painting, also known as La Gioconda, was smiling about. Could it have been about the accounting techniques imparted by Leonardo’s friend Pacioli? Perhaps one day we will learn the answers, but only after the convergence of accounting standards is complete.


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