Differences Between Financial Accounting and Administrative Accounting.

Although financial accounting and administrative accounting originate from the same information system, designed to facilitate the decision-making of its different users, they have differences and similarities that need to be known in order to differentiate them precisely.

ADMINISTRATIVE ACCOUNTING

FINANCIAL ACCOUNTING

Generates information of internal use in the organization, for the decision making The information you need helps in decision-making to take action focused on the future. It is not regulated by accounting principles. There is a mandatory information system is an optional system. It cannot accurately determine the utility generated, provides approximations or estimates. It resorts to disciplines such as statistics, economics, operations research, finance and others in order to provide solutions to problems of the Organization

Generates information to provide people related externally to the organization (Banks, shareholders, etc.) Generates information about the past or historical events of the organization. The information it generates must be regulated by principles, rules and accounting rules. It is a compulsory system in accordance with commercial law It accurately and accurately provides the utility generated. Financial accounting is supported by the accounting information of each area of ​​the Organization.