Differences Between Managerial Accounting and Financial Accounting
Managerial Accounting
What Does Managerial Accounting Mean?
- The process of identifying, measuring, analyzing, interpreting, and communicating information for the pursuit of an organization's goals.
This is also known as "cost accounting."
- Managerial accounting is used primarily by those within a company or organization. Reports can be generated for any period of time such as daily, weekly or monthly. Reports are considered to be "future looking" and have forecasting value to those within the company.
Financial Accounting
What Does Financial Accounting Mean?
- Reporting of the financial position and performance of a firm through financial statements issued to external users on a periodic basis.
- Financial accounting is used primarily by those outside of a company or organization. Financial reports are usually created for a set period of time, such as a fiscal year or period. Financial reports are historically factual and have predictive value to those who wish to make financial decisions or investments in a company.
Differences between managerial accounting and financial accounting
The key difference between financial and managerial accounting is that financial accounting is aimed at providing information to parties outside the organization, whereas managerial accounting information is aimed at helping managers within the organization make decisions
* Confidentiality and type of information
Management Accounting is the branch of Accounting that deals primarily with confidential financial reports for the exclusive use of top management within an organization. These reports are prepared utilizing scientific and statistical methods to arrive at certain monetary values which are then used for decision making. Such reports may include:
• Sales Forecasting reports
• Budget analysis and comparative analysis
• Feasibility studies
• Merger and consolidation reports
Financial Accounting, on the other hand,
What Does Managerial Accounting Mean?
- The process of identifying, measuring, analyzing, interpreting, and communicating information for the pursuit of an organization's goals.
This is also known as "cost accounting."
- Managerial accounting is used primarily by those within a company or organization. Reports can be generated for any period of time such as daily, weekly or monthly. Reports are considered to be "future looking" and have forecasting value to those within the company.
Financial Accounting
What Does Financial Accounting Mean?
- Reporting of the financial position and performance of a firm through financial statements issued to external users on a periodic basis.
- Financial accounting is used primarily by those outside of a company or organization. Financial reports are usually created for a set period of time, such as a fiscal year or period. Financial reports are historically factual and have predictive value to those who wish to make financial decisions or investments in a company.
Differences between managerial accounting and financial accounting
The key difference between financial and managerial accounting is that financial accounting is aimed at providing information to parties outside the organization, whereas managerial accounting information is aimed at helping managers within the organization make decisions
* Confidentiality and type of information
Management Accounting is the branch of Accounting that deals primarily with confidential financial reports for the exclusive use of top management within an organization. These reports are prepared utilizing scientific and statistical methods to arrive at certain monetary values which are then used for decision making. Such reports may include:
• Sales Forecasting reports
• Budget analysis and comparative analysis
• Feasibility studies
• Merger and consolidation reports
Financial Accounting, on the other hand,