Both systems using book of accounting. For example cash book, journal and ledger. Both systems use double entry of bookkeeping Both systems preparing balance sheet in the end of financial year in order to determination financial position of an organization. Both systems records transactions in the books in chronological manner and in systematical way
Financial accounting and management accounting are almost similar but difference lies in the usage of the accounting information. Financial accounting addresses to all of its stake holders such as shareholders, general public, investors, lenders, creditors, financial institutions etc. Management accounting mainly is used for the financial managers for internal purposes and involves accounting techniques for monitoring their internal processes. For example a company using Activity Based Costing (ABC) method does not need to display the whole process in its annual reports, it is more of useful for the internal managers of the company. The techniques and accounting procedures are the same in financial and management accounting. In fact, some of the educational institutions teach financial and management accounting as one subject.
Management accounting has got to do with making decisions based on financial reports i.e. Balance sheets etc. Financial accounting is the actual compilation of the financial statements. Accountants do this. Very boring...hope this helps?
I feel that the top answer is completely wrong! Financial and management accounting are very different as far as the method of each is concerned. Financial management focuses on the figures for a certain period of time focusing primarily on the past and summarising finances from sources such as creditors (where you gain money) and debtors (where you owe money). Management finance is different due to the fact they take the financial summary once finished off the financial team and review and plan ahead, it involves very little of the past, the past only contributes as a help to plan for the future.
