Difference between Financial Accounting and Management Accounting | Management Accounting

Difference between Financial Accounting and Management Accounting
Management Accounting
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Management Notes

Financial Accounting Management Accounting
Financial Accounting helps to provide information to the people who are outside the organization like stockholders, creditors, etc. Management Accounting helps to provide information to the people who are inside the organization like managers leading to proper direction and control of the activities.
Financial Accounting  helps to summarize data for the whole organization and also emphasizes on precision and verifiability of data. Management Accounting  helps to summarize data for the segments of organization and also emphasizes on relevance and flexibility of data.
Financial Accounting mainly analyses the past data or past result and diagnoses the past activities. Management Accounting  is mainly concerned with the future and emphasizes on future plans and policies.
Financial Accounting is governed by GAAP (General Acceptable Accounting Principles) as the reports are made to the outsiders. Management Accounting is not governed by GAAP(General Acceptable Accounting Principles) as the reports are made to the outsiders
Financial Accounting is necessary for the publicly held companies and by lenders. Management Accounting is not necessary for the publicly held companies or by lenders.

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