Management Accounting vs. Financial Accounting
Management Accounting vs Financial Accounting
Management accounting is primarily concerned with the preparation and presentation of information to management to help them plan, control and makes decisions about the operations of the business. For example, how many students clear an examination at an educational Institution could be an example of a report prepared under management accounting by that Institution. Likewise, how many papers are attempted in a city for a qualification is another example of management accounting or management information for the Institution.
On the other hand, financial accounting is concerned with the preparation and presentation of accounting information on the performance and financial position of the business. This would be more formal and structured report prepared under a specific format for external users. For example, if Apple Inc. is required to publish its balance sheet and profit and loss account, this information is purely related to financial accounting.
The management accounting may not be structured and may be too frequently published for the want of the management / Board. However, financial accounting, for the use of external stakeholders like shareholders or investors, is essentially in a structured format. Also, a financial information is published for limited number of times due to costs involved.