Managerial accounting focuses on supplying financial information to the company’s managers. Normal financial accounting is much more comprehensive and deals with internal as well as external reporting. Some examples of external reporting could include stockholders, governmental agencies (taxes), investors and lenders. Managerial accounting is considered internal reporting and is used in the decision making process for increased profitability and asset utilization.
Managerial Accounting and Managers Financial Information
The type of financial information that’s supplied to managers normally depends on the individual functions of each manager. These particular functions can vary widely depending on the business model. In some cases the financial information that’s supplied to each individual manager is limited to their specific area of responsibility. Below are some examples of some management areas and the financial information that’s needed for decision-making.
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