Differentiate between managerial and financial accounting

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Dear Student,

Managerial accounting:
Meaning:
Management Accounting is the branch of accounting used by the persons working within the organization for making decisions about the efficient functioning of the organisation. In management accounting, reports are generated daily, weekly or monthly depending upon the requirements of the company. In management accounting, reports are prepared predicting the future of the company viz., sales forecasting reports which predicts the future sales value of the company for the next financial year (s). Management Accounting deals with making decisions between different choices and alternatives. Example: 1.whether to open new retail branches in far off locations.
2. Whether to recruit new manpower to improve the production. 3. Whether to do expansion or diversification programmes etc.,
Financial accounting;
Meaning:
Financial accounting is the branch of accounting used by the persons outside the organization. In financial accounting, financial statements are prepared for the period as required by Law usually for one year. Financial statements are used by the persons like shareholders to make decision whether to purchase the additional shares in the company or to sell off the existing shares. Likewise, banks and financial institutions use the financial statements prepared under financial accounting to assess the profitability of the organization and the liquidity and solvency of the organization to take the decision regarding
a. whether to ...