Cost Accounting and Management Accounting

Cost Accounting:

1. Deal with: Cost accounting deals with ascertainment, allocation, appointment and accounting aspect of costs.
2. Base: Cost accounting provides a base for management accounting.
3. Role: Cost accounting is helpful in collecting costing data for the management.
4. Status: The status of cost accountant comes after the management accountant.
5. Outlook: Cost accountant has a narrow approach. He has to refer to economic and statistical data for analysing cost effects.
6. Tools & Techniques: Cost accounting has standard costing, variable costing, break even analysis etc. as the basic tools and techniques.
7. Scope: Cost accounting does not include financial accounting, tax planning and tax accounting.
8. Period of planning: Cost accounting is concerned with short term planning.
9. Assistance: Cost accounting merely assists the management in its functions.
10. Approach: Cost accounting is historical in its approach.
11. Installation: It can be installed without management accounting.

Management Accounting:

1. Deal with: Management accounting deals with effect and impact of cost on the business.
2. Base: Management accounting is derived from both cost accounting and financial accounting.
3. Role: Management accounting has a greater degree of relevance and objectivity as the management accountant has a clear idea of the types of cost and items requiring analysis problems of business.
4. Status: Management accountant is senior in position to cost accountant.
5. Outlook: Management accountant reports the effect of cost on the business along with cost analysis.
6. Tools & Techniques: Along-with tools and techniques of cost accounting, the management accountant has funds and cash flow statement, ratio analysis etc. as his accounting tools and techniques.
7. Scope: Management accounting includes financial accounting, cost accounting, tax planning and tax accounting.
8. Period of planning: Management accounting Is concerned with short range and long range planning and uses techniques like sensitivity analysis, probability structure etc. its special field is evaluation of capital investment project.
9. Assistance: Management accounting assists and evaluates the management performance.
10. Approach: Management accounting is futuristic in its approach.
11. Installation: Management accounting needs financial and cost accounting as its base for its installation.