Since management involves many
decisions based upon cost information, costs and cost concepts are important
topics for management accountants. How does cost accounting fit into the
picture? Cost accounting is a subset of both financial and management accounting.
Accurate product costs must be determined according to GAAP for external
reporting purposes and according to decision relevancy for internal purposes.
So cost accountants must be familiar with GAAP and also the report formats
desired by management.
Management Accounting occupies a much more important role in our economic society today than it did in the past. The Institute of Management Accountants (IMA)promotes the interests of this group of accountants. The primary difference in Financial and Management Accounting is the focus on external versus internal users of information. Management Accounting caters to internal users and Financial Accounting to external users.