Henry Rand Hatfield: Humanist, Scholar and Accounting Educator.

ZEFF, STEPHEN A., Henry Rand Hatfield: Humanist, Scholar and Accounting Educator (Stamford, CT: JAI Press Inc. 2000, pp. 515, $78.50).

The focus of this meticulously crafted book is on the life and work of Henry Rand Hatfield, but Stephen Zeff's biography also is concerned with developments

in accounting thought and business education in the first four decades of the twentieth century, a time when Hatfield and others like Paton played an important role. The first four chapters chronicle Hatfield's life and work. Chapter 5, which includes a section by Basil S. Yamey, assesses Hatfield's contributions to the field of accounting and its history. Chapter 6 deals with the "personal Hatfield." This is followed by reprints of a selection of Hatfield's unpublished and published papers (with comments and notes by Zeff), remarks on the unpublished papers by Maurice Moonitz, further remarks on Hatfield by Moonitz, a list of Hatfield's publications, and a lengthy index. The book is the first volume in the series, Studies in the Development of Accounting Thought, edited by Gary John Previts and Robert J. Bricker.

The book opens with a Preview by Maurice Moonitz who was Hatfield's student at Berkeley, a Preface, and an outline of Hatfield's career. Hatfield was born in 1866. His father, Rev. Robert Miller Hatfield, who was imbued with the Puritan-Methodist tradition, had a deep influence on Henry, who completed a course of study in the classics at the age of 16 and continued his classical studies at Northwestern University. But after two years at Northwestern, Hatfield left to join a private banking firm and bond house in Chicago, S. A. Kean & Co. (Kean was his brother-in-law), where Hatfield was introduced to the world of finance and accounting as a bookkeeper, clerk, and later as the manager of the firm's New York office. The firm became insolvent in 1890. Allegations of fraud were made against Kean, and this was followed by a trial where Hatfield was a witness. The case was settled when "friends" arranged to pay creditors 35 cents on the dollar.

Soon after this, Hatfield returned to Northwestern where he switched his major from the classics to German, probably because of the influence on him of his brother, James, who received a Ph.D. in German and then taught German at Northwestern. He also took nine credits in political economy and, upon graduation, started work on a Ph.D. in political economy at the University of Chicago. He completed the degree in 1897, with the thesis, "Municipal Bonding in the United States," which was reported to be 1,923 pages. No copies survived. Then, after a year at Washington University in St. Louis where he taught a variety of courses including psychology, Hatfield returned to the University of Chicago and was apparently the first faculty member connected with the College of Commerce and Politics. In 1901, he taught a course with some, but not exclusive, accounting content and in the next year taught a

course in the "principles" of accounting. Hatfield was on the faculty of the University of Chicago until 1904, when he accepted an appointment as associate professor of accounting at the University of California, where, except for short periods, he continued to teach until his death in 1945. Hatfield's education, business, and teaching experience is an uncommon background for the first full-time academic appointment in accounting in the United States!

Zeff conjectures that even though Hatfield never took a formal course in accounting, his experience with Kean & Co. and his dissertation research qualified him for the task of developing a course in accounting. Hatfield himself states that his specialization in accounting was an "accident" (p. 34). However, it's tempting to argue that because of the surely traumatic events that followed the insolvency of Kean & Co., Hatfield, after completing the Ph.D., chose accounting as a field of study because he recognized the important economic role that accounting played. It is also true that demand for accounting was growing and that the subject was intellectually appealing to Hatfield.

Modern Accounting was published in 1909. Zeff notes that at this time, an American literature on accounting "hardly existed" (pp. 65-66) and that the situation in Europe was not much better. While it is true that the U.S. accounting literature was sparse in 1909 (only 2 U.S. texts published before 1909 were mentioned by Zeff), the literature in the U.K. was much more extensive. Indeed, Modern Accounting contains many cites to the U.K. sources. Actually, it can be argued that "modern" British accounting literature predates the literature on this side of the Atlantic by 25 years and Hatfield's emphasis on case law dealing with accounting issues had been characteristic of British writers for 20-30 years prior to the publication of Modern Accounting.

In 1922, Hatfield presented a paper, "De Computis et Scripturis," to the Berkeley Club. It was revised and "An Historical Defense of Bookkeeping" was presented in 1923 to the eighth annual meeting of the American Association of University Professors (the predecessor organization of the American Accounting Association) and was a "sensation." It became one of the most celebrated, scholarly papers in accounting (with cites to classic literature, history, and mathematics). The purpose was to persuade his audience of the respectability of accounting with the following (one of many) famous lines: "The contempt for accounting is not limited to university circles, but is well-nigh universal. It is evidenced by ignorance of the subject, by condescension toward its devotees, by their exclusion from polite literature."

What motivated Hatfield to write this? Zeff suggests that it was the condescension that Hatfield himself was suffering (p. 121). Accounting was rejected as an academic field of study by non accountants and accountants. Furthermore, Hatfield had a classical education, studied German, and was a political scientist. His perspective was international. He had no formal training in accounting and was not a C.P.A. He attended very few the annual meetings of the American Accounting Association and its predecessor organization. He wanted to inspire students to think "rather than teach them anything" (p. 207). In short, Hatfield was "different." He also was a tough critic and intellectually honest. Small wonder that Hatfield felt condescension, perhaps even some hostility, from others.

In 1938, Hatfield coauthored (with Thomas H. Sanders and Underhill Moore) A Statement of Accounting Principles, which was published by the American Institute of Accountants (now the AICPA). Zeff comments that a younger Hatfield might have "withdrawn as a coauthor of a volume with which he was so fundamentally in disagreement" (p. 178). Hatfield also had reservations about an American Accounting Association Committee report (1936), "A Tentative Statement of Accounting Principles Affecting Corporate Reports," of which he had this to say: "My first criticism is that the report begins with a criminal assault on the English language" (p. 384).

Hatfield had major interests in bookkeeping history, depreciation, and price level accounting and wrote many book reviews (54 reviews were written from 1895 to 1943). His last major academic effort was the Harvard lecture, "Surplus and Dividends" given in 1942, three years before his death. While all of Hatfield's published books and articles were on topics in accounting, many of his shorter pieces, book reviews, and unpublished papers were on a broad range of subjects.

In assessing Hatfield's contributions, Zeff points out that, despite his teaching commitment to accounting, he seemed to be ambivalent about whether accounting was an academic field and, apparently, tried to keep the size of the full-time faculty at Berkeley down. While "An Historical Defense" argued eloquently for more respect of the field, Hatfield may not have thought that accounting is a proper subject for a Ph.D. (He had one doctoral student.) Yamey also comments on another contradiction. While Hatfield was the "foremost historian of accounting of his generation," "what he could have achieved greatly exceeded what he managed to achieve...." (p. 244). Could Hatfield have explained theses paradoxes? Perhaps. He certainly questioned whether it is "better to write about things than to do them" and whether the overemphasis upon the possession of a doctor's degree as a requisite to teaching is a mistake" (p. 375).

Hatfield was fiercely independent. In "A Professor Looks at Germany" (1933), a talk given at the Berkeley Club that recounts his experiences during a visit to Germany in the first half of 1933, Hatfield was keenly aware that his views about Nazi Germany would be sharply criticized by some members of the audience. (To put this time period in historical perspective, Hitler became Chancellor on January 30, 1933. While terrible things were happening, few were forecasting the horrors that would occur. For a gripping account of the Nazi years by an academic, see the two-volume work by Victor Klemperer, I Will Bear Witness 1933-1941/1942-1945 (New York, NY: Random House 1998/1999).) Knowing this and surely being sympathetic to this reaction, but being unwilling to compromise, Hatfield concluded the paper with this extraordinary Apologia (p. 368): "... whatever I may have said, I am not a Nazi, I disbelieve in their doctrines and loathe and abhor their practices, and I have never yet, nor do I intend ever in the future, to torture any Jew."

In his 1937 retirement address to the Berkeley Club (pp. 368-383), Hatfield devotes most of the talk to a review of his academic life and provides, as Zeff says, "revealing insights into Hatfield as a person." What is somewhat surprising is that in this talk, Hatfield makes only a single (and quite sardonic) comment about his work in accounting.

   The most refreshing comment that has come to me in regard to my work is as
   follows: A young accountant was given a copy of my first book which, while
   not so planned, came to him on Christmas day. Opening the package, he
   commented, as he read the title: "Hatfield's Modern Accounting. Well, if
   that isn't a hell of a Christmas present."

This is a wonderful book. It was a delight to read. The book gives a valuable account of an interesting period in the development of accounting thought and the early history of business education, but, more importantly, Zeff's biography is a fascinating study of a highly intelligent, complex individual.

RICHARD P. BRIEF
Professor
New York University