How is Management accounting different from Financial accounting?

 

How is Management accounting different from Financial accounting?

Financial accounting and management accounting have some inherent differences. They are

Basis for ComparisonManagement accountingFinancial accounting
PurposeIt is used for internal purposeIt is used for external reporting primarily, although the management also reviews it
RegulationIt is not regulated by any lawIt has to be presented as per standards
UsersIts users are the management of an organizationIts users are shareholders, investors and regulators
ObjectiveIt aids in internal decision makingIt aids in investment decision by outsiders and monitoring by regulators
MandatoryPreparation and presentation of financial statements is not mandatoryPreparation and presentation is mandatory.  
AuditIt is not subject to auditFinancial statements must be audited
FrequencyThere is no defined frequency for preparation and presentation of the statementsFinancial statements must be prepared for the financial year and presented
ContentsManagement accounts include both monetary and non-monetary informationFinancial accounts include only monetary information

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