role of financial and management accountant

Question 1

What is the role of a financial accountant?

Answer 1

To keep accurate records of the daily financial transactions of the firm.
To prepare Income Statements and Statement of Financial Positions.
To make use of ratio analysis in order to compare performance from on year to the next with competitors.
To report to the owner of the firm the effect of managerial decisions on the performance of the firm.

Question 2

What is the role of the management accountant

Answer 2

To prepare cash budgets to establish if the business will have enough money in the future to pay bills.
To carry out break even analysis to see how many units need to be sold to cover costs.
To provide management with information to enable decision making e.g. which products should take priority for production if resources are scarce.
Responsible for the collection, processing and classification of costs e.g. direct and indirect/allocation and apportionment.