What’s the difference between financial accountant and management accounting?

Your financial accountant is there to keep the Inland Revenue and any external stakeholders happy. By recording financial information at the end of the year. A financial accountant focuses on tax.
A management accountant is there to help you throughout the year. By providing you with useful information that will enable you to make good decisions and optimise your company’s performance.

Reply 1

dhrubo18

One is internal and another is external.

Reply 2

ajj2000

Original post by dhrubo18

One is internal and another is external.

not really true - most large companies have jobs called 'financial accountant' and others 'management accountant'.

Reply 3

dhrubo18

Original post by ajj2000

not really true - most large companies have jobs called 'financial accountant' and others 'management accountant'.

Those depends on the volume of wprk they do a actually.

Reply 4

mathperson

Original post by ajj2000

not really true - most large companies have jobs called 'financial accountant' and others 'management accountant'.

Yes, he/she was absolutely correct.

Original post by morganreach

A financial accountant is primarily concerned with EXTERNAL reporting. E.g. preparing a set of financial statements (accounts) for submission to government authorities (e.g. Companies House).
These kinds of financial statements typically cover a specific time period of a company - the company's financial year.

A management accountant on the other hand is concerned with INTERNAL reporting and produces documents called "management accounts", which tell the business managers about the performance of the business, typically on a monthly basis.

If you want to train to become a financial accountant, start with the AAT.
If you want to train to become a management accountant, start with CIMA.

(edited 2 years ago)

Reply 5

ajj2000

Original post by dhrubo18

Those depends on the volume of wprk they do a actually.

Well - job titles are far more arbitary than that - the description by @mathperson is very good - I'd add that for larger companies financial accountants prepare reports for investors. These may be shareholders or banks/ financial institutions.

Reply 6

dhrubo18

Financial Accounting usually includes the preparation of financial statements, calculation of tax etc. And the Management Accounting is there for the preparation of cost accounting which are beneficial to the internal users' decision making.