differences between financial accounting vs managerial accounting

PRESENTATION OF MANAGERIAL

ACCOUNTING

Difference between Financial Accounting

VS Managerial Accounting

KEEN ORBIT

Group Name-

Presented to –

Roushan Ara

SultanaAssistant Professor

FBA, USTC.

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WHAT IS FINANCIAL ACCOUNTING?

Keeping track of records and creating a

summary of financial transactions is called

bookkeeping - When this information is

produced and displayed in reports for the use

of the public outside the company, this

process is called financial accounting.

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WHAT IS MANAGERIAL ACCOUNTING?

Management accounting or managerial

accounting is the process of identifying,

analyzing, recording and presenting financial

information that is used for internally by the

management for planning, decision making

and control.

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Management Accounting is the process of

Identifying

Measuring

Analyzing

Communicating Information

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MANAGERIAL VERSUS FINANCIAL ACCOUNTING

Accounting System (accumulates financial and

managerial accounting data in the cost accounting

system)

Managerial Accounting

(Information for decision making,

planning, and controlling an organization’s

operation.)

Financial Accounting

(Published financial statements and other financial

reports.)

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Accounting

Financial Accounting

Managerial Accounting

External users of Accounting information

Internal users of Accounting information

Investors Creditor

CustomersTaxing

authorities

Management Employees

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AUDIENCE

Financial

Accounting

Managerial accounting

produces information that is

used within an organization,

by managers and

employees.

Financial accounting

produces information that is

used by external parties,

such as shareholders and

lenders.

Managerial

Accounting

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OBJECTIVES

Financial

Accounting

The main objectives of financial

accounting are to disclose the

end results of the business, and

the financial condition of the

business on a particular date.

The main objective of managerial

accounting is to help

management by providing

information that is used to plan,

set goals and evaluate these

goals.

Managerial Accounting

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Focus

Financial accounting focuses

on history; reports on the

prior quarter or year.

Financial

Accounting

Managerial

AccountingManagerial accounting

focuses on the present and

forecasts for the future.

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Department

Financial

Accounting

Managerial

Accounting

Preparing financial

accounting is the work of

finance department.

Managerial accounting is not

specific task of particular

department. Co-ordination of

all department creates

management accounting

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Financial

Accounting

Format

Format is informal and is on

a per department/company

basis as needed.

Financial accounts are

reported in a specific format,

so that different

organizations can be easily

compared.

Managerial

Accounting

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Financial

Accounting

Managerial

Accounting

Reporting frequency and duration

As needed - daily, weekly,

monthly.

Defined - annually, semi-

annually, quarterly, yearly.

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Financial

Accounting

Managerial

Accounting

Purpose of Information

Help managers plan and

control business operations.

Help investors, creditors,

and other make investment,

credit, and other decision.

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Financial

Accounting

Managerial

Accounting

Nature

It’s classifies records,

presents.

It’s classifies records,

presents.

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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.

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QUESTION OR QUERY

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THANK YOU EVERYBODY

Presented by-

Abdul Motaleb Shobuj

ID- 1126

FBA, USTC

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