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Managerial Accounting
This essay will discuss the differences between managerial accounting and financial
accounting in an organization. It will also cover the responsibilities of managerial
accounting in dealing with the security and financial integrity within an organization. And
in the conclusion, I will submit my opinion regarding the expanding role of managerial
accountants in organizations.
Managerial Accountants vs. Financial Accountants
Financial Accountants
Financial accountants develop financial reports based primarily upon historic data that can
be accessed by internal and external users. Such reports are balance sheets, the income
statement, statement of owner equity and statement of cash flow. The external users that
will want to view these reports are as follows: possible investors, banks and credit unions
that may loan money, and the U.S Government for audit purposes. The financial
accountant has to follow the Generally Accepted Accounting Principles (GAAP), which is
the standard framework of guidelines of financial accounting used in the United States.
Managerial Accountants
Managerial accountants help the decision makers of the organization make decisions based
off of reports that are future orientated. Although their reports are derived from historical
data, they use statistical methods to forecast future values. Confidential managerial reports
are produced for the top management of companies for decision making purposes, and are
only for the organization internal use.
"Management accounting is intended to satisfy the various needs of a large group of
decision-makers inside the business, and does not follow GAAP,"“ like the financial
accountant. "However, multinational companies prefer to employ Managerial Accountants
