Luca Pacioli's Double-Entry Principle as a Basis for Internal Control and Reliability of Mandatory Sustainability Reporting under ESRS

Tetyana Butenko and Viktoriia Butenko
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Tetyana Butenko: Odesa Polytechnic National University, Ukraine
Viktoriia Butenko: Odesa I. I. Mechnikov National University, Ukraine

Oblik i finansi, 2026, issue 2, 24-32

Abstract: In the context of European integration, from 2026, large companies and some medium-sized enterprises in Ukraine will be required to prepare and publish ESG reports in accordance with the European Sustainability Reporting Standards (ESRS). This process requires integrating non-financial information on environmental, social, and management aspects of the enterprise's activities into the traditional accounting system, creating new challenges for ensuring reliability, transparency, and internal control. The article aims to substantiate the thesis that the classical principles of Luca Pacioli – debita = credita, balance control, and an ethical approach to records – remain a powerful tool for solving these problems. The research methodology includes analysis and synthesis, establishing cause-and-effect relationships, modeling, and the tabular method. The author, discussing the historical origins of the double-entry principle, justifies its relevance in the context of the digitalization of accounting, particularly for non-financial reporting. The article discloses the stages of implementing mandatory ESG reporting in Ukraine and the mechanism for ensuring internal control over its data. In addition, it provides practical examples of accounting for typical ESG transactions to demonstrate how the double-entry principle applies to non-financial transactions. The results of the study indicate that, in modern conditions, the double-entry principle is an "antivirus" built into the accounting system, helping prevent greenwashing – the embellishment or distortion of information about sustainable development. Thus, the 532-year-old double-entry system not only withstands the challenges of the digital age (ERP systems, AI, blockchain) but also ensures high-quality integration of financial and non-financial information. Digital technologies (blockchain, AI, XBRL) do not abolish the principle of double-entry, but only strengthen it, making control more automated and reliable. Enterprises that form their accounting policy on the principles of Luca Pacioli will gain a competitive advantage, increase stakeholder trust, and minimize reputational risks during an ESG reporting audit.

Keywords: Luca Pacioli; double-entry principle; ESG reporting; ESRS; sustainable development; internal control; greenwashing; accounting in Ukraine (search for similar items in EconPapers)
JEL-codes: M41 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:iaf:journl:y:2026:i:2:p:24-32

DOI: 10.33146/2518-1181-2026-2(112)-24-32

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