The formation and use of a profit reserve at the end of the fourteenth century

Mikhail Kuter, Alan Sangster, Marina Gurskaya*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

8 Citations (Scopus)


This article analyses the earliest known use of reserve accounting in the late fourteenth century. It reveals the dual purpose of this reserve, the entries made, including those made when the reserve was utilized and when the remainder was written-back to be distributed to the owners in the following accounting period. The research method is archival, using logical–analytical modelling of a merchant’s accounting records from 1392 to 1400. It finds that a reserve was initially an estimate of costs that had been incurred the amount of which was unclear, and that it was then extended to act as a suspense account to balance the ledger when errors in the double entries could not be identified. In doing so, this study also reveals changes made in how the entries were made to the reserve as bookkeepers sought more efficient ways to make them.

Original languageEnglish
Pages (from-to)69-88
Number of pages20
JournalAccounting History
Issue number1
Early online date10 Sept 2019
Publication statusPublished - 1 Feb 2020

Bibliographical note

The authors would like to acknowledge the contribution of Ripsime Bagdasaryan in the development of this paper. The authors would also like to thank Professor Giuseppe Galassi without whose help and guidance we would never have been able to begin our work in the Datini archives.

The author(s) received no financial support for the research, authorship and/or publication of this article


  • Datini
  • double-entry bookkeeping
  • medieval accounting
  • merchandising account
  • reserve accounting


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