Differentiate Managment Accounting with Cost and Fiancial Accounting

The ICMA, London, defines management accounting as “the application of professional

knowledge and skill in the preparation and presentation of accounting information in such a way as to assist management in the formulation of various policies and in the planning and control of the operation of the undertaking”.

The American Accounting Association, committee on management accounting, defines nmanagement accounting as “the application of appropriate techniques and concepts in processing the historical and projected economic data of an entity to assist management in establishing a plan for reasonable economic objectives and in the making of rational decisions with a view towards achieving these objectives”.

Important: Though some number of differences can be identified between cost accounting and management accounting, the line of difference is very thin. Because, cost accounting, at present, comprises of some of the advanced techniques and systems of costing such as budgetary control, marginal costing, standard costing, etc. and therefore, it tends to conform to management accounting. Consequently, not much difference can be found between the two. The main differences between cost accounting and management accounting are discussed in this video: 

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