Difference Between Management Accountant and Chartered Accountant
A Management Accountant and a Chartered Accountant are both of the same profession but the difference lies in their scope of work. The chartered accountant has become very common, and most people know about their type of work. They realize that a Chartered Accountant is a person authorized to work in the fields of business and finance. On the other hand, most people are not aware of the kind of job done by the Management Accountant. Usually, people cannot tell the difference between the two and some have never heard of a management accountant. This article intends to explain these two concepts clearly and differentiate between their roles and duties.
The management accountant is an employee in a company or corporation who is experienced and knowledgeable about finance and accounts. He uses this knowledge to conduct his duties as an accounts manager. He is in charge of the accounts for the company and he required to prepare the financial statements of the Company for the exclusive use of the senior administration of the company. He uses his expertise to arrive at better decisions for the administration and finance for the organization. In addition to the role of a finance advisor and accountant, he is also responsible for the risk management, performance management and management of different strategies.
In modern times, a management accountant has become essential in large companies. A management accountant is experienced in finance, management and accounts and is therefore the perfect person required to drive a company forward. A management accountant performs many administrative roles including some important ones as follows.
• He advises the Board of Directors regarding the financial implications of any project.
• He clarifies the financial consequences of any business decision.
• He performs internal audits.
• He analyses the financial decisions taken by their business competitors.
A chartered accountant is a person who is mostly from outside the company, who is required to check the financial records of the company. They are experienced in finance and taxation. In addition to the job of preparing the financial statements of a company, they must also provide financial advice to their clients regarding increasing of profits and reduction of taxes. A chartered accountant can work for different organizations, like private companies, public sector firms and for non-profit organizations. He is a professional whose main job is to provide financial guidance to his clients.
The difference between Management Accountant and Chartered Accountant:
Both the professionals have a similar job profile. However, within the organization, the scope of work and the responsibility of the management accountant are much more than that of the chartered accountant. There are many differences between a management accountant and a chartered accountant. These are listed below
• A management accountant is a financial expert like the chartered accountant, but he uses his knowledge and experience for the senior administration of the company. On the other hand, a chartered accountant takes care of the financial statements and accounts of a company for taxation purposes and for analysis by the shareholders.
• A management accountant is an employee of the organization and he works within the system. A chartered accountant is always from the outside and looks after the accounts of many companies.
• It is the job of a management accountant to oversee the financial records of the company. He is in a position to warn the top management about the financial implications of any business decision or any project. A chartered accountant is not involved in internal decision making in the company.
• The job profile of a chartered accountant is limited to preparing accounts in such a way to maximize profits and reduce taxes of the company while a management accountant is fully involved in all business decisions taken by his company.