Accounting in hybrid forms of capitalist/socialist enterprises. A multiple interpretative approach to the Royal Factory of Silk of San Leucio (1789-1826) Valerio Antonelli*, Emanuela Mattia Cafaro**, Raffaele D’Alessio***, Roberto Rossi+ *, **, ***Department of Management and Information Technology, +Department of Economics and Statistics, University of Salerno – Italy Corresponding author’s email: vantonel@unisa.it 1 Accounting in hybrid forms of capitalist/socialist enterprises. A multiple interpretative approach to the Royal Factory of Silk of San Leucio (1802-1826) Abstract The aim of this paper is to show the role played by Accounting in an industrial company in which elements of utopian socialism and capitalism lived together. The case in point is the Royal Factory of Silk, founded by King Ferdinand IV at S.Leucio, near Caserta, in 1778, and this paper covers the years 1802-1826. This paper emphasises the threefold role played by Accounting. Firstly, the double-entry bookkeeping was adopted to calculate the minimum profit rate owed to the capitalist shareholders. Secondly, Cost Accounting was used to support efficiency control. Thirdly “labour accounting” measured the workers’ performance and shared the surplus value between the enterprise and the workers. This paper makes a significant contribution to Accounting History literature: (a) it adds archival evidence of accounting practices in Italian industrial companies; (b) it supports the close connection between the DEB and capitalism; (c) it shows that the accounting system is set up to reflect the different social organisation of a manufacturing company; (d) it illustrates how the accounting system makes the wealth-generating and wealth-distributing process accountable. Keywords: Utopian Socialism. Capitalism. Silk. Labour. Italy. Nineteenth century. Introduction The international accounting history literature that dealt with industrial companies in capitalist and market-economy contexts is extremely wide and, in its “traditional” or “neo-classical” approach, it supports the close bond existing between the double-entry bookkeeping (DEB) and capitalism, showing the role played by financial accounting in support of decision-making and shareholderoriented annual reporting (Littleton, 1933; Pollard, 1963; Lee, 1975; Johnson and Kaplan, 1987; Edwards, 1989). Studies from the “critical” area have emphasised the importance of cost accounting, standard costs, budgets, performance measurement and other managerial tools in capitalist enterprises after the Industrial Revolution, even if through different theoretical approaches, from the socio-institutional (Hopwood, 1983; 1987; Hopwood and Miller, 1994; Chapman et al., 2009), to the Foucauldian (Burchell et al., 1985; Hoskin and Macve, 1986; Miller and O’Leary, 1987; Stewart, 1992), from 2 the labour process to the Marxist one (Hopper and Armstrong, 1991; Bryer, 1993; 1999; 2005; Tinker, 2005; Toms, 2002; 2005; 2010). Alongside them, there are a wide number of papers dealing with the purposes, traits and contexts of accounting systems in industrial companies, written by scholars who do not identify with the “critical” positions (Edwards and Newell, 1991; Tyson, 1993; Boyns and Edwards, 1996; 2006; Fleischmann et al., 1995; Fleischman and Tyson, 1998). The international accounting history literature that has been focussed, instead, on the industrial companies that do not meet all capitalistic requirements is much more limited, not least because such kind of experiences did not take place in every country across the world not very often in the last three centuries. The first category of “non-capitalist” industrial companies reviewed by the literature includes stateowned enterprises in market economies. The Seville-based Royal Tobacco Factory is one of the most frequently investigated examples (Carmona and Macias, 2001; Carmona et al., 1997; 2002; Macias, 2002). Alongside it, there are the Royal Textile Mill of Guadalajara (Carmona and Gomez, 2002) and the other Spanish and Portuguese experiences of the 19th and 20th centuries (Nunez, 2002; Sanchez-Matamòros et al., 2005; Carvalho et al., 2007). In any case, these were king-owned large-scale factories privatised after a long period of public management, in which Accounting played a key role in keeping labour under control and pursuing efficiency, even without any real profit-oriented drive. Then, accounting history research focussed on state-owned enterprises in the developing countries, in which the state’s hand in economy was heavier than in the Western countries precisely to boost the development of a basic industry. These papers show the different roles played by Accounting in supporting the birth of enterprises and measuring their performance (Foreman and Tyson, 1998; Rahaman and Lawrence, 2001; Hooper and Kearins, 2004). Finally, a large number of accounting history papers were concerned with the accounting practices of state-owned enterprises in advanced industrialised countries, such as UK (McInnes, 2002), 3 France (Touron and Vesey, 2008), US (Preston and Vesey, 2008), and Japan (Sasaki, 2001; Noguchi and Boyns, 2012). The second category of non-capitalist industrial companies includes the so-called “experiments of utopian socialism” scattered all over the world after the 19th century. “Utopias” have been mainly researched by economic history and sociology scholars who have shed light on the two cornerstones of such social and productive models: the factory and the community. On one hand, such line of research concerns the productive (Robertson, 1971; Donnachie and Hewitt, 1993) and organisational areas of the factory (Hatcher, 2013), on the other hand, it is about the community, focussing on its educational (Lambert, 2011), cultural (Kesten, 1996; Davidson, 2010), and social areas (Royle, 1998; Sutton, 2004; Donnachie, 2006; Lallement, 2012). The most interesting cases investigated by accounting history literature are those told by Walsh and Stewart (1993), Funnell (2004) and Davie (2007). Such papers investigate the role played by Accounting, mainly in measuring use value based on worked hours, not exchange value based on market prices, in social experiments reproducing the communal and productive models of 19th-century utopian socialists in real life. Lastly, the third category, that is, industrial companies in socialist or communist contexts, is widely investigated by accounting history literature (Lin, 2003; Tudur & Mutiu, 2007; Djatej & Sarikas, 2009; Barbu et al., 2012; Ji & Lu, 2013; Zelenka & Zelenková, 2013; Xu et al., 2014). Such papers show that the role of Accounting is to support the control of performance and behaviour, and it is not of course aimed at measuring profits. The aim of this paper is to look into the role played by Accounting in a hybrid context, from an institutional, social and economic viewpoint, i.e. the Royal Factory of Silk of San Leucio (hereinafter: RFSSL), not far from Naples, between the late eighteenth century and the early nineteenth century. The factory was set in a communal context that was ruled according to socialistutopian principles of political and social cohabitation (laid down in 1789): all community members were equal, all private property was banned, the community fulfilled everyone’s needs, education 4 was compulsory, lots of the customary social and family restraints and bans of the time were repealed, human and religious values were shared. In its turn, the community of S.Leucio was closely bound to the factory founded and funded by King Ferdinand IV. As a hybrid form of capitalism and utopian socialism, the history of the RFSSL cannot be univocally read. Each one of the most widespread “critical” approaches, i.e. the Foucauldian and the Marxist one, seems to be unable, on its own, to fully understand this case, since it does not meet the requirements or mixes them up with opposite ones, for either historical analysis to be fully effective as an explanatory tool. After all, the “traditional” and “neoclassical” approaches do not seem to be effective either, since the influence of social and institutional factors on accounting and the many effects of accounting on such factors, in the case at hand, defy such theoretical patterns (Napier, 2006: 467). From a socio-institutional perspective, the research agenda is open and includes a study of the interconnections between accounting, institutional and social practices (Hopwood, 1983). Research that depicts accounting as a social and institutional practice typically seeks to explore accounting from a broad perspective, probing the applications of accounting practices in the social and organizational contexts in which they occur (Potter, 2005: 267; Miller & O’Leary, 1994). Studies in this field attribute the application of accounting practices within particular organizational contexts, with implications on the behaviour of individuals and the functioning of organizations and societies (Hopwood, 1992; Miller, 1994). The common denominator of such studies is, therefore, an analysis of the social issues and agents involved the connections with the other aspects of social life, and the consequences of such interactions (Burchell et al., 1980: 23; Miller et., 1991). Accounting is actually considered to be a tool for setting economic norms or standards of efficiency and seeking to define the ways in which economic surplus is to be calculated, adapting to and shaping the context (Miller & Napier, 1993: 645). 5 The case of the RFSSL will be explored from a very broad perspective, covering the social, institutional, organisational and accounting aspects, both together and in their mutual interplays. Next, the capitalist dimension of the factory may be investigated from a Marxist perspective, and labour from a Foucaldian or, again, Marxist perspective. Marx’s pattern of analysis let the accounting historians to emphasize the accounting’s overall measure of a business entity’s performance, the extent to which it carries out its social duty, i.e. the rate of return on capital (Tinker, 1999). Furthermore, in Marx’ analysis the object underlying accounting profit is surplus value (Bryer, 1999). Surplus is produced entirely by workers while capitalists appropriate such surplus because thier aim is to maximize the return on capital employee (Bryer, 2006; Chiapello, 2007). Thus, DEB has a crucial role in measuring, on a company level, the capital, the profit and the rate calculated dividing the latter by the former (Toms, 2010). In addition, accounting could reveal the components and the accumulation of such surplus (Bryer, 2005). Foucault described the history of many institutions (prisons, asylums, clinics) as they emerged after the Enlightenment as forms of social control over population (Foucault, 1967; 1979; 2003). Accounting historians who support Foucault’s pattern of analysis emphasize the importance of remote control and surveillance as means of controlling labour in capitalist and no-capitalist contexts (Miller & O’Leary, 1987; Hopper & Armstrong, 1991; Stewart, 1992; Fleischman and Macve, 2002). The sources of the paper are many. Most of the main primary sources come from the State Archives of Naples, where the regulations, documents, account books (journals, ledgers, labour books), reports and financial statements of the RFSSL were consulted. A document comes from the Royal Palace of Caserta Archive. Other primary sources are documents published in the years covered by this paper. Secondary sources consist of publications about the community of S.Leucio, the RFSSL, and the experiment of utopian socialism. To achieve these goals and illustrate the events we have just mentioned the paper is structured as follows. The next section describes the political, legal and social context in which the community of 6 S.Leucio grew, was shaped and established. The third section gives prominence to the productive and organisational traits of the RFSSL. The fourth, fifth and sixth sections show the different roles played by Accounting and its effects on the organisation and the communal institution, respectively in terms of financial accounting, management accounting and labour accounting. Discussion and comments on the RFSSL case follow. Finally, the conclusions are drawn, with a summary of the results achieved, the limitations of the paper, and any potential developments for future research. The community of San Leucio The establishment of the colony of S.Leucio officially dates back to 1789, when the King Ferdinand IV1 issued the “Regulations” (Ferdinand IV, 1789). The King had thought of creating an ideal community, in which all residents were equal, received proper social assistance and healthcare and adequate education, regardless of their gender. In the development of such community, work would have been the key factor for the improvement, qualification and elevation of the residents’ social status (Battaglini, 1983). At the same time, it would have helped control and rule over the residents along with compulsory education which – still missing in the Kingdom, as well as elsewhere in Europe – would have been open to women too. On the other side, the development of the colony of S.Leucio also responded to the dramatic change that was taking place in the role and in the very meaning of the State, in the eighteenth century. There was a feeling that the State was changing to a sort of police state, all focussed on social control (Lazzarich and Borrelli, 2012; Cirillo, 2012: 31-32). The 1789 Regulations consisted of 27 articles and three sections, the so-called ‘negative duties or bans’), ‘positive duties, or rights and obligations’ and ‘work rules’ (Ferdinand IV, 1789). 1 Ferdinand IV of Bourbon, King of Naples (I of Two Sicilies) 1751-1825. Ascended to the throne in 1759, he was the first son of Charles of Bourbon. Ferdinand’s reign was interrupted by the proclamation of Neapolitan Republic and later French invasion (1799) and, after a first restoration, by Napoleonic invasion (1806-1815). Ferdinand was confirmed as King of Two Sicilies in 1815 by the Congress of Vienna. 7 The ‘negative duties’ set forth by the regulations punished conducts that could be detrimental to other people and to other people’s assets and listed all the unacceptable behaviours, so as to make trade and transactions as proper as possible (Ferdinand IV, 1789: XVIII-XX). On the other hand, the ‘positive duties’ were rules that were essential for the optimum operation of the colony and also covered employment. A general introduction about the need for equality and mutual respect among the residents was followed by more specific provisions, in the attempt to distinguish residents based on their talents, all revolving around their professional achievements. Therefore, despite censoring luxury (among the residents) and prescribing a consistent dress code and strict personal and home hygiene, the regulations gave pride of place to work as a way to differentiate people from each other (Ferdinand IV, 1789: XXIII-XXV). Most of such legislation was designed to control social relations, thus proving that the experiment was first and foremost a communitarian one rather than a productive one. To achieve such goal, the Regulations laid down the rules for the institution of marriage, both within the colony and with nonresidents, so it was bound to some rules (age, fitness for work). Furthermore, the Regulations provided for free and compulsory education for all residents, both men and women, and guaranteed work at the factory (Ferdinand IV, 1789: XXXV-XXXVII; S.Leucio, 1789) (Table 1). Table 1 – Synopsis of the 1789 Regulations Art. Heading Key points 1 2 3 4 Do not offend anyone (injury, kill, etc.) Do not steal anyone’s belongings, do not deceive anyone Personal reputation is protected by the State, and defaming is forbidden Live in peace and friendship with the other community members 5 6 7 Personal offences Do not steal Do not defame Respect other community members Consistent dress code Respect the King Respect the secretaries 8 Marriage 9 10 11 12 13 14 15 16 17 Married couples Father Child education Rules of inheritance Children Siblings Apprentices Patrons Young people All members must be dressed in the same way, and all luxury goods are forbidden The King is the second most respected figure in the community, after God State and government secretaries must be respected by the community members, as the King’s representatives Marriage rules (20 years of age for men, 16 years of age for women); no parental permission; working in silk manufacturing; rules on marriage to foreigners. Married couples’ rights and duties; mutual respect and care. Parental duties School regulations, subjects (grammar, mathematics, ethics, religion) No wills; spouses and children are the only heirs, in equal parts. Children must respect their parents and follow their directions Siblings must live together in peace, according to their parents’ rules Apprentices must follow their masters’ directions as if they were their fathers Patrons are the best part of society. Community members must respect patrons Young people must respect elderly people and follow their advice, as more experienced than 8 18 19 Elderly people ‘Seniori’ 20 21 Smallpox vaccination Appointment of ‘Seniori’ 22 23 24 25 Poor people and Charity fund Funerals Homeland Jobs 26 Foreign workers 27 Punishments they are Elderly people must give advice and be good examples to young people The ‘Seniori’ were 5 community delegates, appointed by the community members every year to run the colony and administer justice All children living in the colony will be vaccinated against smallpox During Mass on S.Leucio’s Day, the head of every household must cast his vote for the appointment of ‘Seniori’ in front of the parish church A special charity fund, funded by every worker with a small part of their monthly wages, is set up to assist the poor or workers when ill or unable to work, etc. The funeral mass must be simple and the same for every resident All members must love and defend their homeland All members of S.Leucio community must work at the community’s factories (silk, leather, gloves, etc.) Any foreign worker or craftsman who wishes to join the colony must spend one year in the colony, adhere to all its rules and work hard. Criminal law shall apply to transgressions committed by residents; in addition, transgressors will be expelled from the colony. Source: Ferdinando IV, 1789. Capitalist wealth was redistributed to the colony in the form of free and compulsory education, health care, social security and housing. In addition, living in the colony also meant having access to meals when working at the factory and, generally, to the distribution of victuals during the year or on special occasions (Pezone, 1972). Work too was entirely different, since living in the colony meant working in the silk factory, which meant having no competition on the supply side, on the employment market, such as free bargaining and the option to ask for lower wages. In addition, the work carried out by the residents was skilled work, the result of the factory’s investments in education and apprenticeships. Finally, child labour was almost non-existent in S.Leucio, the only form being apprenticeship, but only after attending compulsory education (Ferdinand, 1789: XXXV-XXXVII). The most interesting points in the Regulations were free healthcare for all residents and the establishment of the Charity Fund. Healthcare was regulated according to the other forms already beginning to be included in the Kingdom’s legislation. The Articles actually took inspiration from the most advanced healthcare criteria of the 18th century, which would not touch the rest of Italy until the early 19th century (Ferdinand, 1789: XXI; Garbellotti, 2013). On its hand, the Charity Fund – run by the parish priest, the directors of the RFSSL and the “Seniori”, i.e. the most senior craftsmen living in the colony – was an institute that took care of the 9 workers’ sustenance by creating a fund which all the residents working in the factory had to pay into from their wages. A portion of S.Leucio’s workers’ monthly wages were withheld and paid into such fund. The Charity Fund was also supported by other assets and transactions (Ferdinand IV, 1789: L-LIII). The RFSSL The first phase (1778 – 1802) The RFSSL was opened up to finish off Ferdinand IV’s communitarian project. In 1778, when the colony was still far from being formally established, the population of the village of S.Leucio was 134 (Brancaccio, 2012). When the Regulations were enacted, the colony of S.Leucio had a population of 214, including French craftsmen, skilled staff in charge of animal husbandry and to take care of the cattle farm. The works for the equipment and the conversion of the existing buildings cost the King over 200,000 ducats (ARCE, 1825; Patturelli, 1826). The RFSSL can be regarded as a definitely innovative experiment, in terms of organisation and production. The idea of building a large-scale central factory had no precedents in the European economic scenario of that time. Actually, only the large-scale Royal Mills, since the late XVII century, were as big and complex (Carmona et al., 1998, 2002; Carmona and Macìas, 2001; Carmona and Gomes, 2002; Carvalho et al., 2007). The colony was coordinated by a superintendent, who had the authority to manage the factory as well, assisted by a general manager and five directors, each one in charge of one process: spinning, warping, dyeing, silk weaving and hosiery. In addition, the superintendent was responsible for keeping the books and drawing up the yearly final statements, in consultation with the general manager (ASN, 1839; Ascione, 2006). Between 1790 and 1799, the RFSSL acquired cutting-edge twisting and weaving equipment. In addition, some French craftsmen were hired to improve the production process and promote the transfer of more modern expertise to the local technicians (ASN, 1799; 1800; Converti, 2012). 10 In 1799, the French invasion put an end to Ferdinand IV’s communitarian project, but not to his entrepreneurial one, since the RFSSL was rented out to two Piedmont-born businessmen, Luigi Wallin and Pietro Miranda (ASN, 1825). The second phase (1802 – 1826) In 1802, the new superintendent, Duke of Miranda, proposed to separate the mill’s operations, with the RFSSL directly running the spinning process, and the weaving and the other high-added value processes rented out to a company co-owned by the King, the previous renters and some of the colony’s supervisors. Such change broke with the communitarian ideal of the factory and was a safe adaptation to a capitalistic concept of business (Tescione, 1933b). In 1804, the ownership of the RFSSL changed hands again, with more shareholders joining in, including the Charity Fund (which invested 1,500 ducats), with the stock going up to 9,600 ducats and the King being more involved in the factory, which took care of the spinning process only (ASN, 1804b). In 1806, a new French invasion put an end to the communitarian approach of the colony of S.Leucio. However, while the French gave up the idea of a community, they built a new, larger silk mill then completed a few new buildings that had already been started by Ferdinand IV to house the winders (drying), the weaving and dyeing operations (ARCE, 1825). In 1806, the superintendent entered into a new agreement for the management of both “corporate branches” of the RFSSL, the spinning and weaving operations, with Wallin and Miranda in partnership with the government of Naples and with a capital stock of 42,868 ducats. In January 1809, the partnership was wound up, and the mill was rented out to a French businessman living in Naples, Pierre Maugras. In 1812, because of the low profits produced by the mill and at the insistence of Caroline Bonaparte, wife of King Joachim Murat, the RFSSL was rented for 12 years to a partnership, composed of Wallin, Angelo Maria Duroni, Duchess of Bovino and a few more experienced skilled foremen (ASN, 1816i). 11 At the Restoration in 1815, the company that ran the RFSSL was wound up and, under a deed dated 29th August of the same year, when a new partnership was formed with 13 new shareholders. They leased the silk spinning and weaving operations. The production of scarves and stockings was outsourced to pieceworkers, receiving the raw material from the RFSSL. The new ownership was completed by the end of 1816, when part of the stock capital was acquired by the Charity Fund (5,000 ducats, which were in fact already part of the previous arrangements), and 12,000 ducats by the King. In addition, the company was co-owned by 17 foremen of the factory, with an overall stock capital of 8,500 ducats. Wallin was paid off with a life annuity of 600 ducats as damage for the loss suffered because of his having bought out of the new company and for the work carried out in furtherance of the RFSSL until then (Bianchini, 1839). In October 1825, the new superintendent of the RFSSL proposed to King Francis I2 (successor to his father, Ferdinand IV) to let the mill out to the company set up by Giuseppe De Welz and Giuseppe Baracco. This would have solved the problem of the poor performance of the mill, due to the foremen being involved as shareholders and the conflict resulting from being workers and owners at the same time (San Leucio, 1826; Cicala, 2003). However, the agreement placed one further burden on the lessees that is, repaying, on behalf of the RFSSL, a 30,000 ducats’ debt with the Royal University of Naples (S.Leucio, 1826: XXX, XXXIV; Tescione, 1933). The agreement with De Welz and Baracco was wound up at the King’s request just two years later; since the two shareholders failed to raise the capital they needed, and actually the King was called in to help and pay in as many as 75,000 ducats overall (5,000 as part of the repayment of the debt with the University, and 70,000 ducats for new investments), to enable the mill to survive. Owing to the failure of such attempt to “privatise” the management of the RFSSL, the factory fell back under the close responsibility of the Crown through the superintendent and the direct involvement of the King in the share capital (Tescione, 1961). 2 Francis I of Bourbon, King of the Two Sicilies (1777-1830), ascended to the throne at the death of his father in 1825. 12 A synoptic picture of the different managing bodies of the RFSSL is in table 2. Table 2 – RFSLL’s management and governance Years Governance Rented process / corporate branch Managers 1789 - 1798 1798 1799 1799 - 1802 1802-1804 1804-1806 1806-1809 1812-1815 1815-1820 1820 1820-1826 1826-1828 1828-1839 1839-1843 Direct management Lease Lease Direct management Lease Lease Lease Lease Lease Direct management Direct management + Lease (at the same time) Lease Direct management Direct management All factory Spinning All factory Superintendent Card. Fabrizio Ruffo Paolo Zuliani Luigi Wallin, Pietro Miranda Superintendent Onorato Gaetani King, Wallin, Miranda, foremen King; Wallin; Miranda; foremen; Charity Fund Pierre Maugras Wallin; Duroni; Duchess of Bovino foremen King; Charity Fund; 17 foremen Superintendent Antonio Sancio Superintendent + De Welz; Baracco De Welz; Baracco Superintendent Antonio Sancio Superintendent Giacomo Staiti Weaving and dyeing Weaving and dyeing All factory All factory All factory All factory All factory All factory All factory Financial accounting The RFSSL’s accounting system was quite complicated, and there was a dedicated board to take care of keeping the books. Accounting was shared by three people, according to the Regulations (ASN, 1813). (1) The accountant supervised the journal-keeper and the clerk. He kept the cashbook and submitted all the year’s flows to/from such account to the journal-keeper. He was also responsible for keeping the book of guilds, book of silk delivered to traders, book of certificate and book of agents. (2) The journal-keeper was responsible for keeping the ledgers and journals. (3) The clerk kept a summary book, in which he reconciled all the records from the accountant’s and journal-keeper’s books. The accounting board was part of a broader organisation, at the top of which was the General Superintendent. Hierarchically above the journal-keeper and the bookkeeper, the accountant reported to the General Superintendent in the event of the latter’s default. In turn, the journal-keeper and the bookkeeper reported to the accountant in the event of missing, incomplete or incorrect bookkeeping. 13 The RFSSL’s accounting system was based on DEB and both the journal and ledger are kept together. The journal is the book in which transactions from the ledger are entered daily. A fraction across each entry, on the left-hand side of the page, is cross-referenced to the ledger’s accounts, the numerator being the ledger folio of the debit entry and the denominator the ledger folio of the credit entry. The journals we consulted cover the years 1802-6 (ASN 1802; 1803; 1804; 1805; 1806). Arguably, the journal-keeping method remained the same. Ledgers are extremely detailed. Actually, the accounting system required many accounts, 260 per year on average, which thoroughly cover all the manufacturing processes, as well as all transactions. Each volume contains multiple legal years. The ledgers we consulted cover the years 1806-7 and 1821-6 (ASN, 1806; 1807; 1821b). Finally, in the book kept by the clerk, each account was ranked by type and reduced to thirty, where the total debits and credits had to balance the total amounts on the ledger and the trial balance drawn up by the journalist. The RFSSL’s fixed assets included buildings, looms, equipment and tools, all permanently used as factors of production in the silk factory. Purchases and depreciations of looms or buildings were neither entered in the journal nor in the ledger. Buildings were purchased by the King, and property thereof remained in the King’s hands, so title to them was not transferred to the factory (Ferdinand IV, 1789: XXVI). Neither was the looms owned by the RFSSL, since the King gave one loom to every resident family, for free (Ferdinand IV, 1789: XXVI-XXXI). Therefore, the accounting system recorded just the purchasing of the equipment and tools involved in the spinning and hemming processes. Figure 1 shows the equipment’s turnover, and the amount suggests that the RFSSL was unfailingly looking for any incremental advancement that could be provided by the current technology and tended to replace the tools that were too worn out to support a silk-manufacturing process to the highest quality standards. 14 Figure 1 - New tools and utensils account New tools and utensils for use of the Royal silk factory Debit Credit 1821 1 May 1821, 107,84 ducats, amount of tools and utensils bought in this month 31 May 1821, 31,10 ducats, amount of tools and utensils bought in this month 30 June 1821, 51 ducats, amount of utensilis bought in this month 31 July 1821, 35,05 ducats, amount of utensilis bought in this month 1822 1823 1821 107,84 731,87 30 April 1822, 2971,09, amount 63,62 of tools and utensilis 31,1 430,63 992,23 1822 2.971,09 4.193,61 1823 6,60 147,94 51 35,05 31 August 1821, 208,54 ducats, amount of utensilis bought in this month 208,54 30 September 1821, 208,54 ducats, amount of utensilis bought in this month 77,31 31 October 1821, 208,54 ducats, amount of utensilis bought in this month 88,76 other items 2.971,09 4.193,61 6.394,92 2.971,09 4.193,61 6.394,92 Source: ASN, 1821b. Figure 2 shows the “Repair charges” for the years 1821, 1822 and 1823. Figure 2 - Repair charges account Repair charges account Debit Credit 1821 31 May 1821, 10,74 ducats, amount of money paid in this month for repair charges 30 June 1821, 27,95 ducats, amount of money paid in this month 31 July 1821, 21,40 ducats, amount of money paid in this month 31 August 1821, 13,90 ducats, amount of money paid in this month 30 September 1821, 18 ducats, amount of money paid in this month 31 October 1821, 27,78 ducats, amount of money paid in this month 1822 1823 10,74 177,9 30 April 1822 from profits and loss account, 191,24 amount of 53,68 the repair charge 27,95 48,64 5,22 251,14 58,90 1821 1822 1823 191,24 251,14 58,90 191,24 251,14 58,90 21,4 13,9 18 17,5 Other items 191,24 Source: ASN (1821b). Maintenance was intended to keep the equipment lent to workers in working order. In the profit and loss account of the year 1821, maintenance charges were added up to the other costs for the 15 purchase of raw materials incurred after 1821-22. The amount of 191 ducats (i.e. maintenance costs for the year 1821) accounted for approximately 7% of total manufacturing costs. When direct management was replaced by the rental of the factory or its departments, repair charges in the costing of silk had the same purpose as depreciation charges; namely, to record the reduced value of fixed assets, due to use and aging, on a regular basis. The problem of recording capital and income was crucial for the RFSSL, which dealt with such problem by adopting a sort of disclosure and calculation methods that were quite advanced for the time. The balance sheets we consulted covered the years 1806-07 (ASN 1806; 1807) and 1821-23 (ASN 1821; 1821b; 1822; 1823). Reports were drawn up once a year. The financial year started on May 1 st and ended on April 30th one year later. Formally, balance-sheets consisted of two-sided accounts. The debit section recorded the RFSSL’s stock on hand, debtors, cash and fixed assets. In turn, stock on hand included a number of entries about raw materials and finished goods held by the warehousemen and raw materials by category. The credit section shows equity and creditors. A review of liabilities shows that just a small part of the profits were distributed to the owners, and most of them were paid into a fund, for the RFSSL’s retained profits (Figure 3). Figure 3 – Balance sheet Assets Liabilities Inventories 57.383,25 Share capital Receivables 65.083,46 Charitable fund 5.400,00 Cash 19.440,90 Cash fund 7.678,00 Tools and utensils 2.971,09 Private cash Creditors Payout Reteined profits Total 144.878,70 Total Source: ASN (1821). 16 92.957,33 2.007,17 30.116,40 221,15 6.498,65 144.878,70 In addition, a Profit and Loss Account was regularly drawn up too. It was also split into side-byside sections. The Debit section shows the costs and, in the balance, the net profit, while the Credit section shows profits from production (per unit). Cost entries concern losses from previous financial years, purchases of raw materials, labour costs and interest payable (Figure 4). Figure 4 - Profits and loss of RFSSL Source: ASN, 1821. The balance sheet and the income statement were directly drawn from the ledger and from the journal, respectively. Actually, the balance sheet was based on the accrual principle: revenues were recorded as income even when the cash was not received and costs when they concerned production and not when they were incurred. In accounting terms, the origin of the balance sheet is also proven by the closing procedure in the journal. For example, in the 1802 journal, the closing procedure took four pages (ASN 1802). To understand what happens to surplus value, we have drawn some summary tables for the years 1821-1823 (Tables 3-4). Table 3 – Surplus value shared between investors 17 Laiabilities Amount Interest rate Interest Received amount Mr Rothschild Gram for money given for interest to Royal F. 25.000 4% 1.000 26.000 Mr Brothers Pannese for amount of money spent in the Royal Factory 12.000 4% 480 12.480 Mr De Paolis to amount of money employed in the Royal Factory 4.820 4% 193 5.013 Mr John D Gius. Grossi for amount of money used in the Royal Factory 2.000 4% 80 2.080 86.071 8% 6.886 92.957 5.000 8% 400 5.400 7.109 8% 569 7.678 Capital of the Royal adiministration of S Leucio Capital administration of the Cash charity employed in the Royal Factory Capital of the Company of the Royal factory for working capital fund of the Royal Factory Payout 221 Reteined profit 6.498 Source: ASN (1821) Table 3 summarises the investors’ names and the interest rates. Above all, the names of the people who lent money to the company are those listed at the top. The interest rate on such loans was 4% for the year 1821. The central section of the table lists instead the amounts paid in as equity. At 8%, the rate of return is higher than the interest rate. The interesting point, here, is that the pay-out is particularly low, and most of the profits were held within the factory. As table 3 shows, profits and loss account includes just the interest due to the investors, instead, the amounts paid in as equity are included in liabilities of the balance sheet. One year later, as shown in table 4, there were just two investors, other than the shareholders, and the interest rate slightly increased to about 5%. Table 4 – Surplus value shared between investors Laiabilities Amount Interest rate Interest Received amount Mr Rothschild Gram for money given for interest to Royal F. 37.070 5% 1.853 39.021 Mr Brothers Pannese for amount of money spent in the Royal Factory 19.183 5% 959 20.193 Capital of the Royal adiministration of S Leucio Capital administration of the Cash charity employed in the Royal Factory Capital of the Company of the Royal factory for working capital fund of the Royal Factory 86.071 8% 6.886 92.957 4.629 8% 371 5.000 7.109 8% 569 7.678 Source: ASN (1823) 18 In the period at hand, the General Superintendent was responsible for supervising all operations on the King’s behalf. The General Superintendent acted as a sort of agent for the King. Actually, the Superintendent by acting on the King’s behalf and directly supervising and authorising all the operations that took place at the RFSSL had more information than the King. It was only in 1820 that the King decided to appoint just one Superintendent, Antonio Sancio, to protect his interests on all his properties in Caserta, especially the RFSSL. So, the balance sheet was an essential tool to reduce such information asymmetry and for the Superintendent to report to the King and to any other investor, and document the impact of the new management on the accounts. Management accounting The cost accounting records we found in the archives are incomplete and often incoherent as too old and ruined. However, in 1802, the rudiments of a cost accounting system made an appearance; a conscientious effort by the RFSLL to accumulate costs throughout the production process. All the stages in the manufacturing process that resulted in the production of homemade goods took place within the community-factory system. Such stages ranged from the raising of the silkworms to the production of the finished products, via spinning, dyeing and weaving. The RFSSL’s manufacturing model was strengthened and legitimised by internal regulations (ASN, 1802b; 1816c; 1816d; 1816f). Accounts were opened in the name of spinners, warpers, dyers, weavers, stocking-makers, to track such manufacturing processes and measure their costs. Such accounts were opened for supervisory purposes and helped understand the performance and cost drivers of each manufacturing step (Figure 5). Figure 5 – Cost sheet 19 Source: ASN (1816e). Industrial costs were calculated by adding up the costs of raw materials, direct labour and tool depreciation. Then, the cost entries recorded in the accounting system were worked through and exposed in special reports (Figure 6). Figure 6 – Production cost report Source: ASN (1816h). In table 8, the “a” column stated the maker’s name and surname. The second column listed the names of the products manufactured by each craftsman. Column “c” reconciled the production reports with the manufactured goods to calculate the processing costs. Column “d” evaluated the consumption of raw materials of a given production batch and showed the price of silk. Columns “e” and “f” showed the price of the manufactured goods and the total cost associated with the manufactured goods, respectively. Column “g” listed any amount to be deducted from the price of the manufactured goods, as applicable to each craftsman for faulty goods. Column “h” showed any deducted cost. The amounts listed in the last column, i.e. ‘net payments’ were calculated by subtracting cost-and fault-related deductions from the total cost of the manufactured goods and were the amounts that had to be paid to the makers. It is remarkable the care and attention that went into the quality of such goods. Column “h” actually evaluated the “faults” that were charged, on a pro rata basis, to each worker and to the production manager, so as to push the whole factory to take the greatest care of each processing step. 20 All production reports were commented and reviewed by the Superintendent and by the General Manager to rate the performance of each loom and each craftsman. As we did not find any ledger or account books or non-account books in which costs were written across the prices, cost accounting was not used so much for pricing decisions but rather to assess the product’s profitability. This sounds reasonably in keeping with the utopian model of the RFSSL and with its nature as a hybrid experiment. The RFSSL incurred overheads. As shown in table 5, such overheads included the cost of controversies with defaulting debtors, maintenance of fixed assets, other costs, taxes, the silk mill’s housing and finally the costs incurred to enable young people to learn the trade. Table 5 – Overhead costs Source: ASN (1821b). Overheads were not allocated to products. This had two effects. Firstly, if costs were not used to support pricing decision, the underestimation of full costs was irrelevant, because overheads accounted for about 10% of the total costs. Secondly, overheads were only measured and controlled only at a factory level, so the Superintendent had to be directly and solely responsible for them. Labour accounting The relations between the workers, the community, the Charity Fund and the RFSSL were the most distinctive feature of the hybrid nature of the S.Leucio social experiment. They are summed up in figure 7. 21 Figure 7 – Financial flows inside S.Leucio Wages (a) Professional training (b) Food (c) Community of San Leucio Labour RFSL (d) Benefits Charitable fund (e) Capital (f) Pay-out (g) Wages (a). Men and women who worked in the silk factory enjoyed equal rights and their salaries were set “according to merit”. The only difference was based on individual skills up to the highest salary for the best artists of the Kingdom of Naples and all over Europe (Ferdinand IV, XXIIIXXIV) (Figure 8). 22 Figure 8 – List of workers classified by skill Source: ASN (1819). The first column in figure 8 shows the artists’ name and surname. They were divided in 4 cohorts by skills. The column 2 showed the amount due to each artist for the hand worked silk. It was necessary to deduct from this amount missing orders to obtain the whole amount manufacturing (column 4). Column number 5 showed the amount due for the charitable fund. The last one summarized the whole obligation. Professional training (b). Schooling was compulsory, starting at six years of age: then children went to learn a trade according to their personal talents and wishes (Ferdinand IV, 1789: XXXVXXXVI; S.Leucio, 1789; ASN, 1816g). The mill took care of all the costs for the training of these young residents until they could actively work (ASN, 1816b). Officially established in 1797, the articles of apprenticeship stated that, after a three months’ probation period, these young people would officially qualify as apprentices and could therefore work for three years under a master (Ascione et al., 2012: 397). These young apprentices were also responsible for the upkeep of the 23 mill’s machines. The cost incurred by the RFSSL for the apprenticeship is shown in the records associated with such charges (ASN 1821b). Young people could freely marry without having to ask for their parents’ permission but they preferably had to marry another resident. If a man wanted to marry a woman who was not a resident of the colony, the woman had to be trained in using a loom, and the cost of the training was borne by the RFSSL (Ferdinand IV, 1789: XXVIII-XXX). Food (c). Under the general regulations, basic victuals had to be bought by the RFSSL in the years in which the mill’s wages were too low for the colony to live respectably. In the purchase book for grain, fodder, beans, in 1821, 5,225 ducats were spent for the RFSSL, while 971 and 364 ducats were spent in 1822 and 1823, respectively (ASN, 1821b). Labour (d). A workday consisted of eleven hours a day. At the RFSSL, there were three classes of workers: 1. Workers directly reporting to the RFSSL i.e. spinners and warpers. 2. Salaried workers, most of them directors and administrative staff. 3. Pieceworkers for all processing steps, except spinners and warpers. Workers and salaried workers were monitored by special production reports, which measured the number and quality of the pieces they manufactured. Average wages were higher than those of the other companies of the Kingdom of Naples (Tescione, 1933: 182). Pieceworkers were monitored based on performance, measured ex post (ASN, 1816). If they met the quality standards, then they were entered in a special ranking, which was used when the factory was leased out. The lessee had to hire the people who were at the top of the rank. The pieceworkers’ wages were instead negotiated at market prices when the mill was leased out (Tescione, 1933: 184). Benefit (e). The Charity Fund lent interest-free money to the Community members in need and paid the workers’ pensions. It was supported by such members themselves, who paid a small amount of 24 their wages into such fund. The amount withheld from their wages was 1 tari a month if the worker earned over 2 carlini a day or 15 grane if they earned less than such threshold3. The Charity Fund was run by the parish priest of the colony and by the Directors of the arts. They had to fight against evaders, who were first held up to everybody’s scorn, and, if they committed the same offence again, deprived of any support whatsoever. Ferdinand IV wanted some urban and rural assets to be added to the fund too, so these rents supported healthcare, lighting and more reasonable pensions. Capital (f). Every time the mill’s ownership changed, the Charity Fund acquired some capital shares (usually 5,000 ducats). Pay-out (g). Like any other shareholder, the Charity Fund received a yearly dividend, set at least at 8%. Figure 9 shows the 1821 records for the Charity Fund. Figure 9 – Charity Fund account Administration of the Charitable fund of the Royal colony of S. Leucio for Capital used in the Royal factory Debit Credit 1821 31 October 1821, 200 ducats, amount paid as interest in the capital of the Royal factory 30 November 1821, 200 ducats, amount paid as interest in the capital of the Royal factory 30 April 1822, to the balance sheet, 5000 amount of Capital employed in the Royal factory 1822 200 731,54 200 341,50 5.000 300 5.000 5.400 1823 1 May 1821, 5000, amount of Capital employed in the Royal factory of silk of San Leucio, to the interest of 8 per cent, to pay 300 every year at the and of October 31 October, from profits and loss account, 400 amount of the interest of 8 per cent of 5000 ducats employed in the Royal 168,87 factory 1821 1822 1823 5.000 5.000 5.000 400 731,54 481,47 12,60 5.000 6.373,01 5.481,47 3 300 341,47 5.400 6.373,01 5.481,47 At that time, the ducat was the currency used and it had some submultiples: the value of 1 tari was 1/5 of ducats instead the value of 1 grane was 1/100 of ducats. 25 Administration of the Charitable fund to supply sick's charges Debit Credit 1821 31 December 1821, 931,34, amount of money for the anticipation made by the charitable fund 731,54 1822 731,54 1823 30 April 1822, from the balance sheet, 741,54 amount of the anticipation made by charitable 731,54 fund 1821 1822 1823 731,54 731,54 731,54 Source: ASN (1821b). The records show the credited and charged amounts of shares bought, dividends and expenses incurred by the Charity Fund. In addition, the RFSSL’s accounting system recorded the costs of donations made by the parish priest to the poor. Discussion and comments The accounting system shows better than any regulation or any utopian or socialist idealistic statement the actual nature of capital and work, the role played by both, the relations between them within the factory and the community, and consequently the hybrid nature (capitalist/socialist or simply capitalist and non-capitalist) of the experiment of S.Leucio. The distinctively capitalistic traits revealed by the accounting system are basically three. Firstly, the capital played a key role, without which investments in fixed assets (buildings, looms, trenches, water engines, tools) and working capital (stocks of yarns, raw silk, fabrics, stockings) would have never happened. Such capital was mainly provided by the State, part of it is selfsupported, with a share of net profits retained, part given to the workers either directly or through the Charity Fund. In addition, the capital was not invested for free but provided a return. Alongside them, there were investors who asked for an interest rate, such as the Rothschild family. In 1804 (for 1550 ducats), then in 1816 (for as many as 5000 ducats), the community itself became one of the factory’s owners itself through the Charity Fund. Secondly, employment was always hierarchical and was mainly paid a fixed salary. In particular, non-resident workers received a salary and their performance was directly supervised and 26 monitored. Generally, workers from the community were also paid a higher fixed salary, depending on their experience and skills, while supervision was more complex. The factory’s workers and craftsmen were independent, each one responsible for one loom, and involved in a complex relationship of exchange with the institution. So, the surplus value was shared between the capital and the labour. There were also apprentices and wage-earners, on condition they did not belong to the community. RFSSL had a threefold form of control on labour. First, there was a form of ex ante social control based on their being community members, the training received, and the threat of symbolic or real punishments for breaching any community or factory rules. Second, the performance of workers and apprentices who were not members of the community was closely monitored in terms of surveillance, aiming to control over factory work. Third, there was a form of ex post control, comparing results and objectives in terms of quality standards and production volumes. From this perspective, this was a form of ‘remote control’ à la Foucault (Foucault, 1979; Miller & O’Leary, 1987; Hopwood, 1990; Hopper & Armstrong, 1991; Fleischman and Macve, 2002). Thirdly, the rationalisation of decisions about the use of resources was undeniable, considering the lavish use of cost-measurement tools, efficiency measurement, and the search for new sales markets. The non-capitalist traits of the social experiment of S.Leucio, as revealed by its accounting system, are basically five. Firstly, there was a rate of return on capital but it was fixed. Actually, anything in excess of the 8% yearly rate of return was withheld and invested into the development of the factory or in the assets of the community. The shareholder (first the King, then the Charity Fund as well) did not get hold of the entire surplus value, as actually proven by Accounting (Bryer, 2000; 2005; 2006); part of the profits was directly or residually allocated to the workers’ community that revolved around the factory. In addition, such excess was a substantial one, over several years, equal to about twice or even three times the amount distributed to the shareholders. 27 Secondly, the workers-residents owned one loom each, so somehow they were capitalists too, as the owners of (some) processing equipment. Actually, such looms were not owned by the RFSSL, so they were not included in its nominal accounts. Thirdly, the surplus value generated by the workers, as defined in Marx’s analysis, was not entirely appropriated by the capitalists but, conversely, was partly given back to the workers themselves through a number of benefits, as unfailingly shown by the accounts. The overall amount of the surplus value paid back to the workers actually consisted in food, training, healthcare, subsidies for the poor, goods and services provided for free, as well as any undistributed excess from the aforesaid profits. Furthermore, workers were paid a fixed salary and a variable salary depending on the factory’s profits. Fourthly, the general living and working standards of the community’s workers were comparatively better than those experienced in other capitalist contexts in those years, such as the Industrial Revolution in UK: wages, working hours, cleanliness, green areas, low levels of child labour. Fifthly, there was no such thing as a veritable capitalistic spirit or even an ambition to maximise profits, since the ethical and social foundations of the community and most owners’ adherence to such foundations weakened that spirit and that tension and, as revealed by the accounts, this was proven by facts. Historiography offers several opinions about the community-factory system of S.Leucio, and such opinions follow three main lines. The first line is actually the one that regards the experience of S.Leucio as socialist and compares it especially to Fourier’s Phalanstery. The opinion was first voiced by Alexandre Dumas, the famous French writer (1862: 319). In the early 20th century, such view was supported by political historians (Stefani 1907; Gori, 1909), then it reappeared many years later (Pezone, 1972), but has never been put forward ever again in more recent years. The second, somewhat central, line of thought places the experience of S.Leucio in the context of utopian models but with no traces of socialism. The first who labelled the experience of S.Leucio as 28 utopian was Acton, the British historian (1956: 379). Many contemporary Italian scholars embrace such view (Corrado, 2006; D’Alessandro, 2006; Verdile, 2009; Ascione et al., 2012). In particular, Bagnato (1998: 53-66) compares the experiment of S.Leucio to those carried out in Paraguay in those years and studied by Funnell (2004) as part of accounting history. The third, and narrowest, line of thought confines the experiment of S.Leucio to the dimension of enlightened despotism, emphasising the traits that seamlessly link it to monarchic power and the paternalistic traits that are typical of the King’s actions (Battaglini, 1983; 1983b; Lazzarich & Borrelli, 2012). As well as exposing the operating systems of the factory-community system, the accounting system played a key role in legitimising an organisation that had a mix of innovative institutional rules. On one hand, the accounting system actually played the role that is specific to any capitalistic context: it measured the capital and the profits, and made the net profit and pay-out transparent to the shareholders (especially non-resident owners). On the other hand, the accounting system played a specific role in making the “non-capitalistic portion” of the institution work. Actually, the accounting system was focussed on measuring the transfer of resources from the factory to the community and, even if focussed on the RFSSL, on measuring some of the activities that were carried out in the interest of the community. Therefore, the stakeholders, the managers, the resident-workers, the parish priest could control such transfers. The transparency and tracking of such financial and material flows, as made possible by the accounting system, provided sound grounds for the moral and social legitimisation of the community-factory system, which supported each other and can therefore be regarded as two sides of the same coin. Such hybrid nature has been arguably proven, provided the two institutions are taken together, in their interconnections. Conclusions 29 This paper deals with one of the first and most important experiments of utopian socialism undertaken in Italy between the late 18th century and the first few decades of the 19th century, which is the community of S.Leucio and its silk factory. The accounting system played a key role in making the complex economic and social body work: (a) it measured total revenues and costs and calculated profits, a fixed part of which was allocated to the capitalists (the King and any other private investor) while the rest was allocated to the workers’ community; (b) it calculated production costs by adding up the cost of each processing step, which helped efficiency control; (c) it monitored the wealth distributed to the community and made it accountable to the general manager and thus indirectly to the King. This paper provides some contributions to accounting history literature. Firstly, it adds archival evidence to that of modern and contemporary Italian industrial companies that has already been reviewed by Italians scholars, including the Venetian Arsenal in the 16th century (Zambon and Zan, 2007; Zan, 2004; 2005), and, as to the last two centuries, the Magona d’Italia, Manifattura Ginori, Ansaldo, Brioni (Antonelli et al., 2002; Antonelli et al., 2006; 2008; Sargiacomo, 2008). Secondly, from a Marxist perspective, it supports the close bond existing between the DEB and capitalism: actually, the capitalistic dimension of the RFSSL requires an accurate measurement of profits and rates of return, as claimed by Bryer (2000; 2005), Chiapello (2007), Robertson and Funnell (2012), and Toms (2010). Thirdly, from a socio-institutional perspective, it shows that the accounting system should be shaped to reflect the different social organisation of a manufacturing company and that such accounting system is essential to create non-capitalist production relations (Hopwood 1983; Miller 1994). Finally, because all workers were fairly well educated and could read and understand the account books and reports, the accounting system gave accountability to the wealth-producing and – distributing processes that were grafted into control over the community, which was in turn made 30 accountable by specific reports. Thus, from a socio-institutional perspective, Accounting strengthens the social mechanisms of deliberate ownership on which the communal agreement is based and increases the feeling of justice and identification with the factory, playing a not negligible role in enforcing the factory and the social structure where it was embedded (Burchell et al., 1980; Hopwood, 1983; Foreman and Tyson, 1998; Funnell, 2001; 2004). The limits of this paper are mainly due to archival evidence. Actually, there are no account books at all for the years 1778 to 1802. In addition, also due to a lack of archival evidence, the balance sheets of the first period of business of the RFSSL could not be reviewed, so the yearly distribution of profits could not be analysed. Finally, since the documentation was not exhaustive, we could not fully understand whether the communal accounting system measured the wealth received from the factory and the way it was distributed among the community members according to their needs. Our research paves the way to lots of developments. Firstly, it would be extremely interesting to compare the case of S.Leucio with that of other manufacturing enterprises that, in other countries, have experienced similar social experiments, even if just slightly later in time, such as New Lanark Mill, Orbiston, New Harmony, Earlton, all inspired by Owen and Fourier’s utopian socialism, or, in agrarian context, the experiments of Mir in pre-revolutionary Russia and kibbutz in Israel after WWI. Secondly, our understanding of the accounting practices of Italian industrial companies in non-capitalist contexts could be enriched by research into state-owned enterprises, the cooperatives system based on Catholic or Communist beliefs, and the communes or the Focolare Movement’s enterprises, after the Seventies. Lastly, it would be extremely interesting to find out whether some social, political and religious factors, such as Italy being home to the Papacy or to the largest communist party in the West (after the Second World War), may have helped set up industrial companies that actually worked outside the capitalist scenario, and what role Accounting may have played in such organisations. References Primary sources 31 Ferdinando IV (1789) Origine della popolazione di San Leucio, Suoi progressi fino al giorno d’oggi, colle leggi corrispondenti al buon governo di essa. Napoli: Stamperia Reale. 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