Most slaves were owned by plantation owners, and there would be as much variety in how (or if) they kept their books as there is in how well people track their personal assets today. The government, keep in mind, couldn’t have cared less–there was no income tax until the Civil War, and even then it applied only to wages. The overwhelming majority of plantations did not have share owners. Many did have creditors, who might care about finances, but lending in that era was based mostly on collateral, not on personal income.
So it was catch-as-catch-can. The principles of double-entry bookkeeping were certainly well understood, and had been for centuries. The notion of slaves appreciating (with growth), depreciating (with age), and vanishing via capital loss (death, disability, or escape) were very well understood, since there was an active secondary market in slaves. How meticulously any slave owner applied these principles in his personal records was a matter of personal preference, literacy, education, and financial acumen.
A few corporations did own slaves, sometimes for a brief period of time after they were seized as collateral. We discussed it in this thread, and I have no reason to doubt Sampiro’s estimate that it was fewer than 1% of slaves at any given time.
For those individuals or businesses that did keep good records in double-entry format, emancipation was a capital loss, just as if one’s slaves had run away, or been struck by an epidemic of disease.
The concept of depreciation did not come about until the early 1900’s. As such the concept of a non-cash loss would have likely been a foreign concept as well. Most businesses kept their books on a cash basis. If they had listed their slaves as assets, they would have reduced their asset holdings without a recognition of a loss on their profit and loss statement, as they didn’t have a cash loss.
The official recognition of depreciation as part of the 1913 tax code was certainly a big impetus in the development of the idea, and a major factor in the standardization of methods. However, it was developed much earlier.
Here’s a fairly straightforward article that mentions depreciation being developed in response to railroad issues of the 1830’s and 1840’s, but it does focus mostly on tax issues.
In any event, I have no doubt that a well-run plantation used double-entry accounting. It is simply a superior method of accounting because it is self-checking. The debits must equal the credits, and if the bank account is right, then you know the income and expenses are also right. To do anything else is to invite error and theft.
In order to buy a slave in double-entry accounting, you must either record the expenditure as either as an asset or an expense. Accounting was not so standardized back in those days, so I’m sure different plantation owners used some different methods. Some may have recorded the slaves as an expense when acquired, rather than listing them as an asset. If so, then no adjustment would be necessary when the slaves were freed. Others would surely have recorded the slaves as an asset (with or without depreciation). If the slave is recorded as an asset, then the only way to get the asset off the books is to record an expense for the casualty loss.
But, I want to point out that the OP’s question presumes a plantation that is a corporation with slaves listed as assets. I’ve been basing my responses on that case… the OP didn’t ask about a tiny family plantation with no books.
My family owned plantations in British colonies in the Caribean and South America (another branch owned plantation in the USA). When slavery was outlawed in the British colonies, they received compensation fromthe British government. Here’s more info: http://compensations.plantations.bb/History.aspx
Although the other branch of my family owned plantation in the USA, I am not aware as to whether or not there was any compensation or insurance paid when they lost ownership rights due to the US Civil War (although I doubt if they did).
I’m not sure if you mean that your ancestors were American or that they were absentee owners of American property. Either way they certainly received no compensation from the US or from any state. The Fourteenth Amendment was emphatic on this point:
Insurance policies on slaves were not uncommon, but I’d be shocked if any of them covered emancipation, as opposed to death or disability. Emancipation would be an “uninsurable risk”. I say that just from working in the insurance industry, not from any specific historical knowledge.