Skip to main content

Business Finance Healthcare Finance: An Introduction to Accounting and Financial Management

The difference between financial management and accounting Introduction: Financial management can be defined as the management of liabilities and asset of the company so as to plan the activities of the business to expand and grow in the future. Accounting can be defined as the art of recording financial transaction and reporting the financial transaction for use by business and different stakeholders. Accounting projects the picture about the financial position of an organization. Financial management on the other hand manages the assets and plan future course of action. The end user of the reports generated by accounting is creditors, analyst, regulators, shareholders and management, whereas in case of financial management they are shareholders and management of the company. The main objective of accounting is to provide financial information, whereas financial management strives towards effective use of assets, earn good returns, generate cash and create wealth. The key elements of accounting are financial accounting and management accounting, whereas it includes financial planning, financial decision making and financial control in case of financial management. The primary difference is financial management involves the management of investment and finances of different entities, organizations and individuals, whereas accounting comprises of recording the transaction, maintaining the financial records and reporting the same to different stakeholders of the business.

The difference between financial management and accounting Introduction: Financial management can be defined as the management of liabilities and asset of the company so as to plan the activities of the business to expand and grow in the future. Accounting can be defined as the art of recording financial transaction and reporting the financial transaction for use by business and different stakeholders. Accounting projects the picture about the financial position of an organization. Financial management on the other hand manages the assets and plan future course of action. The end user of the reports generated by accounting is creditors, analyst, regulators, shareholders and management, whereas in case of financial management they are shareholders and management of the company. The main objective of accounting is to provide financial information, whereas financial management strives towards effective use of assets, earn good returns, generate cash and create wealth. The key elements of accounting are financial accounting and management accounting, whereas it includes financial planning, financial decision making and financial control in case of financial management. The primary difference is financial management involves the management of investment and finances of different entities, organizations and individuals, whereas accounting comprises of recording the transaction, maintaining the financial records and reporting the same to different stakeholders of the business.

Solution Summary: The author explains the difference between financial management and accounting. Accounting projects the financial position of an organization, while accounting manages assets and plans future course of action.

Healthcare Finance: An Introduction to Accounting and Financial Management

Healthcare Finance: An Introduction to Accounting and Financial Management

6th Edition

ISBN: 9781567937411

Author: Louis C. Gapenski, Kristin L. Reiter

Publisher: Health Administration Press

See similar textbooks

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

Blurred answer

Chapter 1, Problem 2.1STQ

Chapter 1, Problem 3.1STQ

Students have asked these similar questions

Is there a distinction between management and financial accounting?

How is financial accounting different frommanagement accounting?

What is financial accounting environment?

Chapter 1 Solutions

Healthcare Finance: An Introduction to Accounting and Financial Management

Ch. 1.1 - Prob. 1.1STQ Ch. 1.1 - Prob. 1.2STQ Ch. 1.1 - Prob. 1.3STQ Ch. 1.1 - Prob. 1.4STQ Ch. 1 - Prob. 1.1STQ Ch. 1 - Prob. 1.2STQ Ch. 1 - Prob. 1.3STQ Ch. 1 - Prob. 1.4STQ Ch. 1 - Prob. 2.1STQ Ch. 1 - Prob. 2.2STQ

Knowledge Booster

Background pattern image

Similar questions

Recommended textbooks for you

Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning

Text book image

Managerial Accounting

Accounting

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:South-Western College Pub

Text book image

Principles of Accounting Volume 2

Accounting

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax College

Text book image

Principles of Accounting Volume 1

Accounting

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax College

Text book image

Intermediate Accounting: Reporting And Analysis

Accounting

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:Cengage Learning

Text book image

Auditing: A Risk Based-Approach (MindTap Course L...

Accounting

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Cengage Learning

Text book image

Cornerstones of Financial Accounting

Accounting

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Cengage Learning

SEE MORE TEXTBOOKS