Establishing Accounting Principles as Invariants of Financial Systems

Establishing Accounting Principles as Invariants of Financial Systems
Naftaly H. Minsky
Department of Computer Science, Rutgers University

Abstract: An enterprise that uses evolving software is susceptible to destructiveand even disastrous effects caused either by inadvertent errors, or by malicious attacks by the programmers employed to maintain this software.
It is my thesis that these perils of evolving software can often be tamed by ensuring that suitable overarching principles are maintained as invariants of the evolution of a given software system. In particular, it would be invaluable to ensure that a nancial system satis es the accounting principle of double-entry bookkeeping, throughout its evolutionary lifetime.

We define a concept of evolution-invariant, discuss its usefulness, and show how the above mentioned accounting principles can be established as such invariants.
Keywords: perils of software evolution, evolution-invariants, law governed interaction, accounting principles.

PDF article