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The Accounting System #13:
Complete Virtualization of Accounting

July 1, 2013
by William P. Meyers

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previous: Electronic Money Takes Over

Paper money and coin are increasingly used only in two situations. They are used for small transactions, especially by people with no access to credit. They are preferred for transactions where the parties want to keep out of the all-seeing eye of the System, so their main use has come to be in criminal transactions, like the purchases of illegal drugs or goods where taxes have been evaded. Even these uses of cash may wither as it becomes easier to carry pre-paid cash cards and since everyone with a smartphone who wants to can accept small electronic payments from those cash cards.

The virtualization of money is almost complete. Money represents real-world possessions and human labor. Managing the value of money (its inflation or deflation) and the integrity of the accounting system are of paramount importance to the modern global economy. If all electronic records were lost it might be very difficult linking creditors to debtors. Re-establishing confidence in a money system would be difficult.

The virtualization of the accounting system is also almost complete. Printed materials are gone or going fast. Accounting records themselves are kept on computers. The software systems that keep the accounts and allow for auditing and data mining are rarely printed out onto paper. Banking software systems and enterprise systems are arguably too complicated for any one person to memorize, or perhaps to truly understand in detail.

The Accounting System has become much more than just a tracker of money. To understand the system, and to prosper within it, it is necessary to comprehend the newer facets of the System, like tracking assets and identities. It is also necessary to understand the systemic biases and assumptions of the System.

Next: to be continued with overview of accounting for assets

Agree? Disagree? You can comment on this post at Natural Liberation Blog at blogger.com

[The Accounting System, Your Fate is in the Cloud, is a work in progress by William P. Meyers, ©2013]

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