If you are an accounting student, then you probably are already aware of the fact that managerial accounting is a subject which enables students to manipulate numbers for the betterment of business which makes accounting a high-demand career field. However, managerial accounting is also referred to as management accounting which provides the company’s internal financial information to the managers so as to help them make important decisions.
Financial accounting is the part of accounting which provides financial information to the people outside of the organisation. Managerial and financial accounting’s are the parts of the business management however; many a time’s students get confused between the two.
Here are few of the differences between managerial and financial accounting that will help students to differentiate between the both.
- The major difference between managerial and financial accounting is the very fact that the collected information will be provided to external organisation like shareholders, banks creditors etc. whereas in managerial, collected information will be provided to managers and internal staff of the company or organisation.
- The main focus of financial accounting is always on the history of the organisation whereas managerial will talk about present and future of the organisation.
- Financial accounts always have certain format when presented to their audience so that it can be compared to its competitors however for managerial accounts, there is no such specific format.
- Financial accounting helps in making decisions whether it is investment or in credit rating on the other hand management accounting helps to record, plan and control activities inside the company.
- The frequency and the duration of reporting a financial report is well defined, it can be annually, semi-annually and quarterly according to the organisation and it is important to maintain it whereas managerial report is daily, weekly and monthly and there is no necessary requirement to prepare it.
- The main objectives of financial report are :i) to disclose the end results of the business, and ii) to depict the financial condition of the business on a particular date whereas management reports are there to help management by providing information that are used by management to plan and evaluate.
- For financial accounting, a full process of recording, classifying, and summarizing is followed so that analysis and interpretation of the financial information can be correctly conducted but there is no as such system followed in managerial as the cost accounts are not preserved under management accounting and the necessary data from financial statements and cost ledgers are analysed in financial accounting.
These are some of the differences in managerial and financial accounting. If you still have some query regarding accounting assignments or accounting concepts, you can always get online help. Assignment writing services like essaycorp.com have experienced and dedicated writers those who completely understand that accounting is a difficult subject for a student to grasp the concepts and thus, are ever ready to help you out with it.
They have been helping students around the world in various subjects. Their team of accounting writers are well qualified and also capable of tackling account assignments you’ve been dreading for weeks.