The upcoming discussion will update you about the differences between cost accounting and management accounting.

Difference # Cost Accounting:

1. Cost accounting is concerned more with the ascertainment, allocation, distribution and accounting aspects of costs.

2. The Cost Accounting data generally serves as a base to which the tools and techniques of Management Accounting can be applied to make it more purposeful and management oriented.

3. The scope of cost accounting is narrow than Management Accounting. A Cost Accountant can be helpful in collecting costing data for Management Accountant.


4. The primary emphasis of Cost Accounting is to deal with collection, analysis, relevance, interpretation and presentation for various problems of management.

5. In organizational setup, Cost Accountant is placed at a lower level of hierarchy.

6. Cost accounting does not include Financial Accounting and has nothing to do with Tax Accounting.

7. Cost accounting is more concerned with short-term planning.


8. Cost accounting is concerned merely with assisting in management functions and does not provide for evaluation and performance of management.

9. Cost accounting is mostly historical in its approach and it projects the past.

10. Cost Accounting system can be installed without Management Accounting.

11. Cost accounting is concerned with money as a measure of economic performance.


12. Cost accounting is basically concerned with collection, classification and analysis of cost data.

13. Cost Accounting System is generally kept voluntary, but at present it has been obligatory to keep Cost Accounting records in certain selected industries.

Difference # Management Accounting:

1. Management accounting is concerned more with impact and effect aspects of costs.

2. The Management Accounting data is derived, both, from the Cost Accounts and Financial Accounts.


3. The scope of Management Accounting is broader than Cost Accounting. The Management Accountant places the data in a wider perspective than the Cost Accountant. The Management Accountant is supposed to have a clear idea regarding the items and types of costs required to analyse and decide specific business problems and effect of such costs on alternative solutions.

4. The main thrust in Management Accounting is towards determining policy and formulating plans to achieve deserved objectives of management. Management Accounting makes corporate planning and strategy effective and meaningful.

5. Management Accountant is generally placed at a higher level of hierarchy than the Cost Accountant.

6. Management accounting includes both Financial Accounting as well as Cost Accounting. It also embraces Tax Planning and Tax Accounting.


7. Management accounting is concerned equally with short-range and long-range planning and uses highly sophisticated techniques, like sensitivity analysis, probability structures etc. in planning and forecasting process. Evaluation of capital investment projects is the speciality of Management Accountant.

8. Management accounting is concerned both with assisting management in its functions, as well as evaluating the performance of the management as an institution.

9. Management accounting is futuristic in its approach and predictive in nature.

10. Management Accounting System cannot be installed without proper Cost Accounting System.


11. Management accounting looks at all situations including non- monetary economic events from a management view point.

12. Management accounting directs its attention to various divisions, departments of the business and report about profitability, performance of each of them.

13. The business concern is free to install Management Accounting System.