Phases

Managerial and financial accounting may differ in some key components but they deliver similar information to internal and external users of an organization. Financial accounting is governed by a set of rules established by the Financial Accounting Standards Board (FASB), which determines the information accessed by and reported to the public in the United States. Managerial accounting provides information to managers and other internal users of an organization to make more informed decisions. The main objective of management accounting is to provide important information to assist internal users in planning, controlling, and evaluating different phases of a budgetary development process. For example, the cost of equipment, parts, labor, and individual costs of products and services. Whereas, financial accounting provides information to external users such as stockholders, creditors, and other stakeholders to make informed decisions. This information can be used to evaluate and make decisions for an organization or to compare information between two or more competitors. The information provided by financial accounting reports matters that have already happened while managerial accounting is future-oriented, detailed, and relies on a specific timeline (Franklin et al., 2019).