Financial Accountants vs Managerial Accountants: Which Credential Should You Pursue?
What are the main differences between financial accountants and managerial accountants?
1. Financial accountants focus on compiling, analyzing, and reporting financial transactions for public consumption, while managerial accountants focus on skills related to management accounting.
2. Financial accountants aim to disclose a company's earnings and losses to safeguard the interests of stakeholders, while managerial accountants focus on budgeting, performance management, and risk management.
Main Differences:
Financial accountants are responsible for preparing financial statements for public consumption, whereas managerial accountants focus more on internal management skills.
Financial accountants mainly deal with creating income statements, balance sheets, and cash flow statements, while managerial accountants focus on budgeting, performance management, and risk management.
When considering which credential to pursue between CPA and CMA, it's essential to understand the differences between financial accountants and managerial accountants. Financial accountants focus on providing an accurate representation of a company's financial performance to external stakeholders, such as investors and regulators.
On the other hand, managerial accountants play a vital role in helping companies make informed business decisions by providing financial analysis, budgeting, and performance evaluation. Therefore, if your career goals involve working closely with management to drive strategic decisions, pursuing the CMA credential may be more suitable for you.
Ultimately, the choice between the CPA and CMA credentials depends on your career aspirations and the specific skills you want to develop. Understanding the differences between financial accounting and managerial accounting will help you make an informed decision about which path to pursue in your accounting career.