Financial accounting is the process of recording, summarising, and reporting a company's

financial details to external users such as investors and creditors. GAAP (generally accepted

accounting principles) is the official organization that governs the rules and sets the regulations.

Whereas Managerial accounting is the procedure of utilizing financial information to help

managers understand and make business decisions. There are no official organizations that

govern the details of managerial accounting. Regarding receiving the reports, internal users are

related to managerial and external users for financial accounting.

Characteristic Financial Accounting Managerial Accounting

Purpose Sharing the details with external users Sharing the details with internal users
Investors, creditors, and other external Managers and other internal
Audience stakeholders stakeholders