Genesis of divisional management and accounting systems in the House of Mitsui, 1710-1730

              The Accounting Historians Journal Vol. 11, No. 1 Spring 1984
Sadao Taketera
UNIVERSITY OF KYOTO
and
Noboru Nishikawa SAGA UNIVERSITY
GENESIS OF DIVISIONAL MANAGEMENT AND ACCOUNTING SYSTEMS IN THE HOUSE OF MITSUI, 1710-1730
Abstract: Early in the 18th century the House of Mitsui created a divisionalized administrative structure with a general office known as Omotokata in order to control many operating shops. This paper examines the divisional administrative structure and accounting systems that the House of Mitsui developed between 1710 and 1730.
Introduction
Mitsui is known as one of the largest business enterprises in Japan. "Mitsui family opened its first shop five years before the Pilgrims landed in New England, and established a bank—still op-erating in the same location—in 1683, a decade before the Bank of England was founded."1 After the Meiji Restoration (1868), the House of Mitsui was a leader of Japan's industrialization, and by the early 20th century it developed into a huge economic empire known as the Mitsui Zaibatsu.
This paper will focus on the House of Mitsui in the early 18th cen-tury, when it established the foundation for its subsequent develop-ment. Newly-rising merchants, including the House of Mitsui, grew rapidly in the surge of commodity markets during the late 17th cen-tury. Faced with a national economic recession after the mid-1710s, they rearranged their administrative structures. The objective of this paper is to examine the divisional administrative structure and accounting systems that the House of Mitsui developed between 1710 and 1730.
The research for this paper is based on the many business docu-ments that have survived and are preserved in the House of Mitsui Archives Collection at the Mitsui Research Institute for Social and Economic History (Mitsui Bunko), Tokyo. Existing financial records