S.No.Basis of DifferenceManagementAccountingFinancialAccounting
Designed for providing accountinginformation for internal use by themanagement.Designed to supplyinformation in theform of P&LAccount and BalanceSheet to the externalusers likeshareholders,creditors, banks,investors andgovernment.2.
Directs its attention tothe various divisions,departments andreports about the profitability etc. of each of them.Portrays the positionof business as awhole with the helpof financialstatements likeincome statement &Balance Sheet.3.
Focus on timeframe
Concerned with planning, strongfuture orientation.Concerned withreporting what hashappened in the past.4.
Flexibility withrespect toaccountingstandards
Enjoys the flexibilityin preparation basedon the specificrequirement andutility of themanagement.Prepared on the basisof GAAPs (GeneralAccepted AccountingPrinciples) since itcaters to the needs of outsiders.5.
Speed is often moreimportant than precision. Use goodestimates andapproximations.Events andtransactions arerecorded in precisevalues as theyactually occur.6.
Places considerableweight on non-monetary data alsolike time lost due to break-down, weather conditions, expectedentry of a competitor etc.Only monetarytransactions arerecorded.7.
Integration withother disciplines
Draws heavily fromother disciplines tohelp the managers inthe decision-making process.Basically a self-contained subject.