The Study of the Double Account System at the Gas Light and Coke Company

Abstract

The double account system is a unique method of financial reporting created in the UK in the 19th century. Previous studies have claimed that double account system was created by canal companies and established with railway companies. That system was eventually institutionalised as the Regulation of Railways Act of 1868. However, the deployment of the double account system prior to the enactment of the Regulation of Railways Act in 1868 was not limited to canal companies and railway companies, it was also adopted by gas companies in London. The purpose of this paper is to examine the various developments of the double account system by considering the Gas Light and Coke Company (GLCC) founded in London in 1810 and examining its accounting practices. The double account system of GLCC was established in 1855. In that year, GLCC prepared the Profit and Loss an1d the Balance Sheet. This balance sheet is not an ordinary general balance sheet, but it is positioned as a general balance sheet including a capital account at the top of the debit. And GLCC adopted the usual double account system in December 31, 1868. It can be considered that GLCC used the format of the Regulation of Railways Act of 1868. On the other hand, GLCC created the statement about coal and residual products reflecting the nature of manufacturing industry. In previous studies, the development of the double account system was drawn in a single-line manner from canal companies to railway companies, but this study can actually demonstrate a double-track development including gas companies. In the 19th century, the double account system of gas companies and railway companies in London, while having a mutual impact also transferred accounting technology to each other.