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Managerial And Financial Accounting Report

Submitted by Maddie18 on June 7, 2007

Category: Miscellaneous
Words: 865 | Pages: 4
Views: 600
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Managerial and Financial Accounting Repor
Managerial Accounting and Finance Foundations
FIN 540
February 27, 2006

Financial Accounting vs. Managerial Accounting
The key difference between financial and managerial accounting is that financial accounting is aimed at providing information to parties outside the organization. In contrast, managerial accounting information is aimed at helping managers within the organization make decisions. According to Kieso and Weygant, financial accounting is the process that culminates in the preparation of financial reports relative to an enterprise as a whole for use by parties both internal and external to the enterprise. In contrast, managerial accounting is the process of identification of financial information used by management to plan, evaluate, and control within an organization and to assure appropriate use of, and accountability for, its resources (p. 3). Below summarizes the difference between managerial and financial accounting:

Financial Accounting has been characterized as the branch of accounting that focuses on the general purpose reports of financial position and results of operations known as financial statements. These statements provide a continual history quantified in money terms of economic resources and obligations of business enterprise and of economic activities that change these resources and obligations. The following are the objectives of Financial Accounting/Reporting, to provide:
1. Information that is useful in investment and credit decisions.
2. Information that is useful in assessing cash flow prospects.
3. Information that about the enterprise resources; claims to those resources and changes in them.
Managerial accounting assists managers in carrying out their responsibilities, which include planning, directing and motivating, and controlling. Since managerial accounting is geared to the needs of the...

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