Premium Essay

Finance vs Accounting

In: Business and Management

Submitted By towski
Words 817
Pages 4
Financing Versus Accounting People frequently confuse the two terms of accounting and financing. The reason is that finance and accounting both deal with the financial aspect of an organization or business. The difference is how the managers in these departments deal with the finances. Accounting mainly handles examining and preparing financial records and making sure that they are accurate (Kajanová, 2011). They also have to ensure that the organization is running efficiently and that the taxes are properly paid and on time. Where as finances handles mainly strategies and plans for long term financial goals on an organization. Financial mangers base their decisions on the financial information that was gathered by the accounting department (Kajanová, 2011). That way they can make the best decision for their organization. Accounting and Finance mangers have to work together to operate an efficient and effective organization. The purpose of this paper is to compare and contrast the differences between accounting and financing. Even though both accounting and finance both handle the financial parts of different health organizations, they both handle their finances in very different ways. In accounting, the main areas of concern are keeping financial records, producing production reports, analyses and different statements, reporting all of the information to heads of departments, and occasionally watching investors and the markets (Financial Managers, 2012). In addition, accountants can tend to really focus on would be the quality, reasonability, and the timing of the information that they are giving. On the other side, the role of the financial department is not to give information regarding finances, but instead to make the financial related decisions (Financial Manager, 2012). They also oversee investment choices, and develop different ways to help the...

Similar Documents

Free Essay


...Sadf asdfsa asdf asdf asdf asdf asdf asdf asdf sdf asd fdf df e fe ef ef efa sdasd fad fe a sdasd fa fasd e fasd fwe fad fe fasd fae fae fawe fas dfa fsd asd asdf afe ad sfa sdf asdf asd fasd fsd se few as asd fe da fdas df sd sfda asdf d fas df e fe ads d fd sd sd f das fdd ds fads fs fd sa dfs a sd sdf df asd fsd fsa fds as sds dfs dfaa fd sas ffds asd d sf d df dfd asd adsf asd fafds s f dd sad ss dsdf sd fsd fasdf as dfasd fsd fasfd asd sdf sdf as dfsd fsadf sdaf sdfa asddfs dsf sdfa dfd asd ds fds asdf sdfa dfs dfs dsf afds fdsa dsf dfs dfsa dfs dfsa Sadf asdfsa asdf asdf asdf asdf asdf asdf asdf sdf asd fdf df e fe ef ef efa sdasd fad fe a sdasd fa fasd e fasd fwe fad fe fasd fae fae fawe fas dfa fsd asd asdf afe ad sfa sdf asdf asd fasd fsd se few as asd fe da fdas df sd sfda asdf d fas df e fe ads d fd sd sd f das fdd ds fads fs fd sa dfs a sd sdf df asd fsd fsa fds as sds dfs dfaa fd sas ffds asd d sf d df dfd asd adsf asd fafds s f dd sad ss dsdf sd fsd fasdf as dfasd fsd fasfd asd sdf sdf as dfsd fsadf sdaf sdfa asddfs dsf sdfa dfd asd ds fds asdf sdfa dfs dfs dsf afds fdsa dsf dfs dfsa dfs dfsa df sdfsa dfs dfa ssdf dfs afd dfs dfs fda sdf sdf df dfsa dfas df sdfsa dfs dfa ssdf dfs afd dfs dfs fda sdf sdf df dfsa...

Words: 314 - Pages: 2

Free Essay


...economics, accounting and finance Understand why financial information is important List the main users of accounting information and understand their information needs Distinguish between management accounting and financial accounting List the main types of business ownership and outline their characteristics Summarize the advantages and disadvantages of each type of business ownership p 2 Panagiotis Dontis Charitos WBS, 2013-14 IN TODAY’S LECTURE... Topics Differences between economics, accounting and finance Importance of financial information Users of accounting information and their information needs Differences between management accounting and financial accounting i Main types of business ownership Characteristics Advantages vs. disadvantages 3 Panagiotis Dontis Charitos WBS, 2013-14 ECONOMICS - FINANCE – ACCOUNTING Economics is a social science Study the production, consumption and distribution of services or goods Explain how economies work and how do different economies interact Finance is a subset/tool of economics that studies the financial markets Personal finance, corporate finance, state finance Accounting is an essential part of finance and economics Precise recording, reporting and assessment of financial deals and transactions of a business Preparation of statements or declarations concerning assets, liabilities, and outcomes of operations of a business 4 Panagiotis Dontis Charitos WBS, 2013-14 ECONOMICS - FINANCE –......

Words: 979 - Pages: 4

Premium Essay


...Service Description 1. Corporate Finance & Financial Management: Historical performance; Time value of money: compounding, discounting, present values and future values, annuities and perpetuities, etc.; Interest rates and bond valuation; Dividends and stock valuation and dividend policy; Capital budgeting: NPV, IRR, payback period, profitability index, etc.; Risk, return and security market line: beta estimation, CAPM; Cost of capital, financial leverage, capital structure, etc; Cash and liquidity, credit and inventory management; International corporate finance; Risk management and financial engineering; Options and option valuation; Mergers and acquisitions 2. Accounting for Financial Statements: Preparation of income statement, balance sheet and statement of cash flows: Accounting for specialized items: Property, Plant & Equipment, bad debts; provisions; financial instruments; leases; employee benefits; income taxes; revenues,; foreign currency transactions etc.;Accounting for mergers and consolidations; IFRS vs GAAP; Financial statement analysis 3. Cost and Management Accounting: Cost concepts; Job-order costing vs process costing;ABC Costing; Marginal costing vs absorption costing: CVP analysis; Relevant costs: special order, make or buy decisions; ROA, residual income and economic value added; Standard costing and variance analysis; EOQ and linear programming 4. Quantitative Methods and Business Mathematics: Algebra and logarithm; Series and...

Words: 764 - Pages: 4

Premium Essay

Management Accounting

...------------------------------------------------- Management accounting From Wikipedia, the free encyclopedia | This article contains wording that promotes the subject in a subjective manner without imparting real information.Please remove or replace such wording and instead of making proclamations about a subject's importance, use facts and attribution to demonstrate that importance. (February 2012) | Accounting | | * Historical cost accounting * Constant purchasing power accounting * Management accounting * Tax accounting | Major types of accounting[show] | Auditing[show] | People and organizations[show] | Development[show] |  Business portal | * v * t * e | In Management accounting or managerial accounting, managers use the provisions of accounting information in order to better inform themselves before they decide matters within their organizations, which aids their management and performance of control functions. Contents   [hide]  * 1 Definition * 2 Scope, practice, and application * 3 Differences between financial accountancy and management accounting * 4 Traditional vs. innovative practices * 5 Role within a corporation * 6 Specific methodologies * 6.1 Activity-based costing (ABC) * 6.2 Grenzplankostenrechnung (GPK) * 6.3 Lean accounting (accounting for lean enterprise) * 6.4 Resource consumption accounting (RCA) * 6.5 Throughput accounting * 6.6 Transfer......

Words: 3095 - Pages: 13

Premium Essay

Cost Accounting

...1. What is Cost Accounting and how it is related to Management and Financial Accounting? Cost accounting is a process of collecting, analyzing, summarizing and evaluating various alternative courses of action. Its goal is to advise the management on the most appropriate course of action based on the cost efficiency and capability. Cost accounting provides the detailed cost information that management needs to control current operations and plan for the future. COST VS. FINANCIAL ACCOUNTINGFinancial accounting aims at finding out results of accounting year in the form of Profit and Loss Account and Balance Sheet while Cost accounting aims at computing cost of production/service in a scientific manner and facilitate cost control and cost reduction. Financial accounting reports the results and position of business to government, creditors, investors, and external parties while Cost Accounting is an internal reporting system for an organization’s own management for decision making.In financial accounting, cost classification based on type of transactions, e.g. salaries, repairs, insurance, stores etc. In Cost accounting, classification is basically on the basis of functions, activities, products, process and on internal planning and control and information needs of the organization while Financial accounting aims at presenting ‘true and fair’ view of transactions, profit and loss for a period and Statement of financial position (Balance Sheet) on a given date. It aims at......

Words: 587 - Pages: 3

Premium Essay

Human Resource Management

...Accounting is considered as the major helping hand to form a successive management which needs to report and analyse the business transactions. Accounting is a pathway of measuring success through the designing projects as measuring the outcomes of the projects in line with the target goal of the organisations (Elliot, Barry & Elliot, Jamie, 2004). Organisations maintain their financial reports with the help of accounting theories and policies. The international financial reporting standards also help to keep the accounting practice effectively, efficiently, and correctly. The efficient management will be built if the organisation follows the international reporting standards accurately. As a mandatory course unit of myself I need to prove my understanding about the financial systems and auditing through this report. I will gradually demonstrate my understanding on the purpose, use, importance of accounting records, accounting systems, computerised accounting system, manual accounting systems, business risk, audit risk, internal and external control systems, importance of auditing, and planning audit assignment as well as preparing audit report in the body part of my report. Task One Purpose and Use of Different Accounting Records Accounting records represents the management of all source of information in different records books. These records are ledger, journals, bank statements, adjusting journals, statement verification, invoice, brochure, and etc. The purpose and...

Words: 2394 - Pages: 10

Premium Essay

Adsd Jasd Ad

...Journal of Financial Reporting and Accounting Insurance vs Takaful: identical sides of a coin? Hairul Suhaimi Nahar Downloaded by ZHONGNAN UNIVERSITY OF ECONOMICS AND LAW At 10:31 08 December 2015 (PT) Article information: To cite this document: Hairul Suhaimi Nahar , (2015),"Insurance vs Takaful: identical sides of a coin?", Journal of Financial Reporting and Accounting, Vol. 13 Iss 2 pp. 247 - 266 Permanent link to this document: Downloaded on: 08 December 2015, At: 10:31 (PT) References: this document contains references to 66 other documents. To copy this document: The fulltext of this document has been downloaded 248 times since 2015* Users who downloaded this article also downloaded: Mohamed Sherif, Nor Azlina Shaairi, (2013),"Determinants of demand on family Takaful in Malaysia", Journal of Islamic Accounting and Business Research, Vol. 4 Iss 1 pp. 26-50 http:// Khalid Al-Amri, (2015),"Takaful insurance efficiency in the GCC countries", Humanomics, Vol. 31 Iss 3 pp. 344-353 Nor Aziah Abu Kasim, (2012),"Disclosure of Shariah compliance by Malaysian takaful companies", Journal of Islamic Accounting and Business Research, Vol. 3 Iss 1 pp. 20-38 http:// Access to this document was granted through an Emerald subscription provided by emeraldsrm:509129......

Words: 11566 - Pages: 47

Premium Essay

Business Adminstration

...differences as well. Business Management Degrees Undergraduate and graduate degrees in business management train students to take a leadership role. The core curriculum of most programs will include a grounding in the humanities, as well as specialized coursework in areas such as conflict resolution, critical thinking, personnel development and managing performance. Management degrees focus on the manager's role in setting out an organization's goals and aligning human capital and other resources with strategic organizational goals. Business Administration Degrees Degrees in business administration prepare students to take a major role in the operations of an enterprise. Coursework in the business administration program usually includes accounting, business...

Words: 3147 - Pages: 13

Free Essay

Unethical Behavior Article Analysis

...Wal-Mart Vs. Amazon University of Phoenix ACC 291 Principles of Accounting II Wal-Mart vs. Amazon. Who do you think might win? Well, these are two of the nation’s largest retailers. Wal-Mart mainly sells in-store while all of Amazon’s sales happen online. So why could this competition between two of the largest retailers cause unethical practices and behavior in accounting? Wal-Mart is “considering using its own shoppers as delivery people, providing some kind of incentive to drop off online orders on their way home from the store.” (Heller, 2013) However, this has way too many unknown variables and implications such as taxes and accounting techniques. For example, how would you account for a loss of merchandise for a customer who instead of delivering the product on the way home decided to keep it for him or herself? What adjusting entries would have to be made and where? Wal-Mart could be tempted adopt unethical accounting practices to keep up with Amazon’s booming sales. Most of Amazon’s sales already come with free shipping. Wal-Mart offers free delivery to one of their locations where the customers pick up their merchandise, but not free shipping. Greed and opportunity might lead to either Wal-Mart or Amazon to get involved in unethical accounting practices. This is especially true if an accounting lie could give an edge over the competition. Ignorance in accounting cannot be used by either Wal-Mart or Amazon because these are two large corporations and they......

Words: 593 - Pages: 3

Premium Essay

The Function of Financial Markets

...TOPIC  7  –  FINANCIAL  MARKETS   Eco 304L   Fall  2014   Topic  6  –  Financial  Markets   The  Financial  System  -­‐  How  Businesses  Finance   Themselves   Saving  and  Investment  (National  Income   Accounting  Redux)   Ricardian  Equivalence  and  Temporary  vs.   Permanent  Taxt  Cuts   The  Market  For  Loanable  Funds  –  Modeling   Financial  Markets     1   Topic  6  –  Financial  Markets   The  Financial  System  -­‐  How  Businesses  Finance   Themselves     The  Financial  System   The  Pinancial  system  is  made  up  of  !inancial   institutions  that  bring  borrowers  and  lenders   together   ¤  Financial  markets:    institutions  through  which   borrowers  and  lenders  come  together  directly   ¤  bond  markets   n  stock  markets   n  ¤  Financial  intermediaries:    organizations  that   interact  with  borrowers  and  lenders  separately  and   bring  them  together  indirectly   banks   n  mutual  fund   n    2   Financing  a  company   ¨  How  can  a  company  raise  funds?   Self-­‐!inance   ¤  Borrow ......

Words: 1610 - Pages: 7

Premium Essay

Generally Accepted Accounting Principles

...Accepted Accounting Principles SA HCS/571 January 11th, 2014 R.G. Generally Accepted Accounting Principles Every organization consists of an accounting department that manages the finances. The key element to maintaining any hospital, ambulatory care center, or private medical office is to have a structured financial statement and a team of accountants to audit the establishment. The generally accepted accounting principles that are reviewed include entity concept, going-concern concept, matching principle and cash vs. accrual accounting, the cost principle, objective evidence, materiality, consistency, and full disclosure. The “certified professional accountants are required to indicate whether an audited set of financial statements is in compliance with generally accepted accounting principles” ( (Finkler, Kovner, & Jones, p.104, 2007). The entity concept focuses on the object of study whether it may be a hospital, urgent care center, nursing school, or a private medical office. The intention of the concept is for identification purposes. It is related to health care, for example, a hospital may be affiliated with a long term care facility, a nursing school, and medical office. The hospital is considered as one entire entity. A long term care facility, nursing school, and medical office are considered subentities. The financial statements are prepared separately for each of the identified subentities. The second factor of the generally accepted accounting......

Words: 1117 - Pages: 5

Premium Essay

Pestle Analysis

...Factors to Consider When Choosing a Method of Financing a Business By Derek Dowell, eHow Contributor Banks may want to lend you money if you present a well-prepared business plan. Whether you're starting a new business from scratch or operating a successful business already, securing financing first requires you to think about the best method to go about it. There are many factors to take into account, though some may vary according to an entrepreneur's personal situation. Poor management is the most frequent cause of small-business failure, according to the Small Business Notes website, but it is closely followed by insufficient financing. Other People Are Reading * The Disadvantages of External Equity * Financing Methods for Capital Purchases 1. Funding Availability * The first thing to do when choosing a method of financing your business is to determine what your range of options are. Small Business Notes lists the most common sources of finding money to start a business: personal savings (72 percent), banks (45 percent), friends/relatives (28 percent), individual investors (10 percent), government-guaranteed loans (7 percent) and venture capital firms (1 percent). Most people will not be able to rely on a single source, since banks expect the business owner to put some of his own money at risk in the venture. Spend some time thinking about what sources you can access. Personal Savings * Choosing to risk personal savings on a business......

Words: 1297 - Pages: 6

Premium Essay

Accrual and Cash Accounting

...Accrual and Cash Accounting ACC 290 The biggest difference between accrual and cash basis accounting is the timing in which the revenues or expenses are recognized. Cash basis accounting is used mostly by small businesses or personal finances. The cash basis method accounts for revenue only when money is received or expenses only when money is paid out. For example, when you balance your checkbook, you only enter your paycheck when it is deposited into the bank, and when you write a check to pay a bill, you subtract that sum from your account. The accrual accounting method accounts for revenue when it is earned and for expenses, goods and services when they are performed. Revenue is recognized even if no cash has been received or, in the case of an expense, that has been incurred, no cash has been paid out, and it is the most common method used by businesses today. Let’s say you sell $10,000 worth of goods, under the cash basis method the amount id not entered in to the books until the money has been collected or a check is received. With the accrual accounting method, the $10,000 is recorded as revenue as soon as the sale is made. This is the same for expenses. If you get an electric bill for $1,500, using the cach basis method, it is not entered in to the books until the bill is paid. Under the accrual accounting method, it is entered as an expense as soon as it is received. (Morah, C. 2009) Accountants use the Generally Accepted Accounting Principles (GAAP) to......

Words: 426 - Pages: 2

Premium Essay

Accounting Priniciples and Financial Statement Analysis

...Statements: Foundational Accounting Principles and Terminology Shane R. Wagner TUI University Module 1 Case Study 29 August 2010 Abstract This paper will discuss the common fundamental accounting principles and analyze the financial statements of three major businesses. A basic understanding of the General Accepted Accounting Principles and the standards established within these practices, allow for investors to obtain an accurate snapshot of the financial health of a business. The different methods of documenting both current and future transactions, can have an impact on the information portrayed by the financial statements of an organization. In addition, the basic format of the financial statements can disclose additional considerations of the business, as will be discussed in the analysis of three major businesses within this paper. Information for the analysis portion was retrieved from the financial statements included in the assignment. Keywords: Accrual Basis Accounting; Cost Basis Accounting; Current Assets and Liabilities; Double Entry Accounting; Financial Accounting Standards Board (FASB); General Accepted Accounting Principles (GAAP); Historic Cost; Non-current Items; Security Exchange Commission (SEC); Financial Statements: Foundational Accounting Principles and Terminology Introduction The basic of understanding of an organizations financial statement requires one to be familiar with fundamental accounting......

Words: 1771 - Pages: 8

Premium Essay

Prof EDUCATION Master of Science, MBA in Finance and Financial Markers San Pablo CEU University, Madrid, Spain, 2004 - 2005. Bachelor of Science, Business Administration in International Business and Finance Sergio Arboleda University, Bogotá, Colombia, 1999 - 2004. International Year School, Advance English Anglo World Education, Cambridge, England, 1997 – 1998 PROFILE • Senior Accounting Analyst (Bilingual Professional –Spanish/English). • SAP end user expert. • Possess outstanding record of achievement in back office, operational profitability, business process development, reports, expense control, SAP implementation, policy and procedure development, forecasts, balance sheets, income statements , annual budgets, continuous quality improvement and personnel management, with advanced skills in all aspects of finance and operations involving: |Cross functional teams |Treasury management |Team leadership | |Import/Export |Operating/strategic planning |Market Analysis | |Organizational development |Analysis and Reconciliations |International markets | |Financial management |Analytical Reports |Accounting ......

Words: 865 - Pages: 4