Accounting and Finance are the two major professional fields of the business sector. Accountancy deals with the transactions of an organization firm, while Finance deals with the management process of an organization. Both professions are utilized in the same place at the same time.
Accounting and Finance are the primary tools for recording, analysis, summarization, reporting, and other management processes. Despite many similarities, there are a lot of differences between Accounting and Finance. Let us discuss them.
What is Accounting?
Accounting refers to a process for the analysis, summarization, recording, and conclusions of the cash flow of a business organization. Moreover, the management of accounts is called accounting. The professional of accounting is called an accountant. In addition, it is a fact-based process.
Accounting also refers to conclusions of results from transactions to understand a firm’s growth or decline. An Accountant records the data in the form of books of accounts. It records every type of expense during a fiscal duration. After a specific time, summarize the data and conclude it. Accounting consists of the following steps.
What is Finance?
Finance is the study of money, including its utilization, investment, production, and saving. A finance specialist is called Finance Manager. Moreover, the art of managing cash is called Finance. It refers to the formation of long-run policies for the growth and development of an organization.
It guides people about the guidelines for the long-term benefits of a firm. In addition, it is an observations-based process. If you have money and want to make it profitable, Finance can help you help in this regard. Finance has the following features:
- Investment opportunities
- Money management
- System of money controls
- Future decision making
- Utility of money
Key Differences between Accounting and Finance
- Accounting is the art of accounts management, while Finance is the art of money management.
- Accounting concludes from a specific business year, while Finance makes policies for the future.
- Accounting deals with statutory compliances, while Finance deals with fiscal policies.
- Accounting has the features of Audit, while Finance has the characteristics of capital investment.
- Accounting holds the balance of payments, whereas Finance plays a role in the formation of the budget.
- Accounting looks at the past, while Finance looks at the future.
Comparison Table Between Accounting vs. Finance
|Holds the record of accounts||Has the management of money|
|It looks in the back||Looks at the future|
|The performer is called Accountant||The performer is called Finance Specialist|
|It is facts-based||It is analysis based|
In a nutshell, we can say that Accounting and Finance are pretty different. They have different roles in the professional field. Accounting deals with accounts, while Finance deals with money management.