Today is

By: Uchenna Ani-okoye

Managerial and Financial Accounting

As someone who owns and runs a business, you will constantly be managing many decisions. It may be time now for you to relocate your business? Do you need to employ more people? Do you need to increase the budget for your advertising campaigns? Do you feel it’s time to add a new service or product to your business portfolio? These are decisions that can be fairly difficult to make. Fortunately for business owners out there, they can rely on managerial and financial accounting to best assist them.

These two methods of accounting are quite different from one another. If you were to employ an account to handle managerial accounting duties, that accountant will report to you and the many other managers in your business. The objective is for the accountant to thoroughly study the financial health of your business and then create a report that summarises it in a way that the layman can understand. From this report, you can determine whether or not moving your business to a new location will enhance the bottom line of your business or just add to the financial stress of it.

Financial accounting is much different, but it is also equally as important. In this situation you would employ a (CPA) Certified Public Accountant to study the finances of your business. But this time, the accountant would ensure that you are properly balancing your books, filing your taxes and have a realistic and accurate cash-flow projection.

To summarise, a managerial accountant assist you in making those big decisions for your business. A financial accountant on the other hand is there to ensure that your business is running soundly.