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Differences between managerial accounting and financial accounting

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Differences between managerial accounting and
financial accounting
This article discusses the differences between managerial accounting and financial
accounting.
o
[edit]Introduction
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 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.
[edit]Differences
[edit]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, concentrates on the production of financial reports,
including the basic reporting requirements of profitability, liquidity, solvency and stability. Reports
of these nature can be accessed by internal and external users such as the shareholders, the
banks and the creditors.
[edit]Regulation and standardization

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Differences between managerial accounting and financial accounting This article discusses the differences between managerial accounting and financial accounting. [edit]Introduction 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 is used primarily by those outside of a company or organization. Financial reports are usually created for a set period of ...
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