Differences between Cost Accounting, Financial Accounting, and Management Accounting¶

S.No.	Basis for Comparison	Cost Accounting	Financial Accounting	Management Accounting
1	Meaning	Focuses on the determination, tracking, and controlling of costs incurred in the business.	Records financial information to reflect the profitability and the correct financial position of the company at a particular date.	Concerned with providing financial and non-financial information to managers for organizational decision-making and control.
2	Objective	Reducing and controlling costs.	Keeping a complete record of financial transactions, measuring profit and financial position.	Aiding management in planning, decision-making, and performance evaluation.
3	Information Recorded	Relates to material, labor, and overhead used in the production process.	Transactions measurable in monetary terms.	Both financial and non-financial information relevant to managerial decision-making.
4	Type of Cost Recorded	Both historical and pre-determined costs.	Historical cost only.	Includes all types of costs, also focuses on qualitative information.
5	Mode of Presentation	No statutory forms, voluntary presentation.	Prepared according to accounting standards and in compliance with various acts.	No statutory format; tailored to meet the informational needs of management.
6	Time Period of Reporting	No fixed time period; reports prepared as and when required.	Financial statements are prepared at the end of the accounting period, usually 1 year.	Reports are generated as needed, often monthly, quarterly, or annually, and sometimes ad-hoc.
7	Users	Primarily internal stakeholders like management.	Both internal and external parties like customers, creditors, government, shareholders, etc.	Primarily management and internal users.
8	Valuation of Stock	At cost.	Cost or Net Realizable Value, whichever is less.	Uses various methods depending on management requirements, may include standard cost, marginal cost, etc.
9	Mandatory	No, except for manufacturing firms where it may be required by regulations.	Yes, for all firms to comply with statutory requirements.	No, it is discretionary and tailored to the specific needs of the organization.
10	Profit Analysis	Generally, profit is analyzed for a particular product, job, batch, or process.	Income, expenditure, and profit are analyzed together for the business as a whole.	Focuses on analyzing financial information for internal decision-making, including profitability of projects or departments.
11	Forecasting	Possible through budgeting techniques.	Not typically involved in forecasting.	Integral part, involves various forecasting and modeling techniques for planning and control.

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