Financial AccountingCost AccountingManagement Accounting
MeaningPreparation of financial statements of an organization to provide the financial information to the interested parties. Keeps track of various costs incurred in production activitiesProvides relevant information to the managers to make policies, plans and strategies for running the business effectively. 

Information type

Monetary transactionsMaterial, labour and overhead
ObjectiveTo determine the cost of production and control the costTo assist the management by supplying necessary accounting information
ScopeNot broad, deals primarily with costBroad
PurposePrepare profit & loss account and balance sheet for reporting to owners or shareholders or outside agenciesTo provide detailed cost information to management – internal users
NatureOnly historical dataPast as well as present facts and predetermined figuresRelating to the future. 
Statutory requirementsShould be prepared according to the legal requirements of Companies Act and Income Tax Act. Voluntary except in certain industries. Not compulsory
FormatSpecifiedNot specified
Accounting principleGAAPNo such principle
Reveals profit and loss of the business as a whole – does not show figures of cost and profit for individual products or departments.Shows detailed cost and profit data for each product line or department etc. 
PeriodicityPeriodical process – usually annually.Continuous process – may be daily, weekly, monthly etc. As per the needs
UserInternal and externalInternalOnly internal
Control aspectNo control function – only recording and reportingInvolves controlling aspects. 
Concerned with only historical recordsConcerned with historical as well as current data
Types of transactionsOnly external transactionsExternal as well as internal
Types of statements preparedP&L account, balance sheet etcIdle time report, variance report etc.
Performance measurementMeasures the overall performance of organizationPerformance of various departments and divisions
Publishing and auditingRequired to be published and auditedNeither published nor audited
Financial Accounting – Cost Accounting – Management Accounting


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