In 1989 a UK government White Paper introduced medical audit as a comprehensive and statutory system of assessment and improvement in quality of care in hospitals. A considerable body of research has described the evolution of medical audit in terms of a struggle between doctors and National Health Service managers over control of quality assurance. In this paper we examine the emergence of medical audit from 1910 to the early 1950s, with a particular focus on the pioneering work of the American surgeons Codman, MacEachern and Ponton. It is contended that medical professionals initially created medical audit in order to articulate a suitable methodology for assessing individual and organisational performance. Rather than a means of protecting the medical profession from public scrutiny, medical auditing was conceived and operationalised as a managerial tool for fostering the active engagement of senior hospital managers and discharging public accountability. These early debates reveal how accounting was implicated in the development of a system for monitoring and improving the work of medical professionals, advancing the quality of hospital care, and was advocated in ways, which included rather than excluded managers.