Finance And Managerial Accounting Business & Marketing Essay (Essay Sample)

Financial and Managerial Accounting.
Student’s Name
Institution Affiliation
Financial and Managerial Accounting.
The business environment is ever-changing with new ideas being incorporated into businesses to make them more revenue efficient and independent. Accounting is one of the core departments of any business that has remained constant and relevant even in the age of virtual business platforms. The field of accounting is a dual discipline involving financial and managerial levels of accounting. While the two disciplines are interrelated, some key differences set the two levels of accounting apart. In the case of financial accounting, it is defined as an area of accounting that involves complying financial reports, i.e. income statements and sending the balance sheets to external parties such as lenders, stockholders, internal revenue auditors, or tax professionals CITATION The18 \l 1033 (AccountingTools, 2018). The purpose of financial accounting is to convey facts to the parties above rather than give forecasts or past estimates. On the other hand, managerial accounting is defined as an internal audit of a company's finances. The information produced by such an audit, is used by management to make an informed decision of the future of a company.
The two fields of accounting share some similarities. Both fields of accounting provide factual information to the user. Although the users of financial accounting differ from those that use managerial accounting, the purpose of accounting is to provide information on the finances of a company. Financial accounting reports contain information directed to existing and potential investors so that they can best evaluate the position of the company while selling or buying equity CITATION War18 \l 1033 (Warren & Jones, 2018). Also, managerial accounting reports contain financial information directed to management and other decision-makers so that they can better run the company give the current financial resources available.