Financial management and accounting can sometimes be hard to tell apart. Both deal with financial statements, information, and costs. Understanding the difference is key to selecting the right software for your business. Thankfully, with Acumatica’s financial management software, you can unite these two functions within one powerful solution.
First, let’s look at the differences between financial management and accounting.
Financial Management
Financial management focuses on the overall financial health of a business. Financial management employees produce statements such as balance sheets, income statements, and cash flow statements. In addition to helping internal managers or executives make financial decisions, they are also responsible for informing external stakeholders (stockholders, investors, board of directors, creditors, and financial institutions) about the business’s performance over a specific period. With this information, these external stakeholders can evaluate the company’s performances and cash flow to determine whether to invest in the business, for example.
Financial management also deals with budgets, planning, and forecasting. It oversees the company’s use of resources and ensures funding is coming and going through the proper channels. It’s big-picture and future-focused.
Accounting
Accounting is where the rubber meets the road. The accounting department facilitates day-to-day activities such as tracking financial information, auditing, implementing certain policies and procedures, and more. Accounting employees measure a company’s financial status and keep the company in compliance with relevant laws and regulations. Accounting focuses internally, keeping apprised of teams’ expenses, taxes, bills, etc. In addition, the accounting department prepares regular reports over set time frames, focusing on past activities. Accounting supplies financial management with the data needed to predict and report financial data.
Accounting also has very specific standards for its reports, including the Generally Accepted Accounting Principle (GAAP). Your accounting department may interact with entities such as the SEC and the IRS in order to maintain compliance with various laws and regulations.
Financial Management and Accounting Software
Now that you’ve considered the differences between financial management and accounting, you may be convinced that a separate software solution is needed for each department. While some businesses may have different solutions for financial management and accounting, with Acumatica, you can unite the data from each department—to the benefit of both.
With Acumatica’s financial management software, your company will benefit from:
- Granular insights: Team members can easily review general ledgers and access detailed information. No longer limited to trial balances, they can dive into specific accounts and understand the nuances.
- Unified data: Acumatica provides real-time financial data pulled from a shared, centralized database, thus eliminating data silos and duplicate information.
- Standardized financials: The integration of Power BI enables data selection and transformation across multiple currencies, providing a consolidated dashboard.
- Powerful visual reports: See your financial information at a glance and easily export reports to external or internal stakeholders.
- Easy integrations: Acumatica offers Open APIs to allow for seamless integrations with other software solutions.
- Endless customizations: You can pick and choose exactly what modules to add to your Acumatica financial management system—for accounting or financial management processes. Modules include general ledger, AR, AP, cash management, tax management, deferred revenue accounting, fixed assets management, bank feeds, payroll management, and more.
Looking for a Solution? We’re Here to Help!
If you want to improve your financial management and accounting processes at the same time—while allowing them to work off of the same data, avoiding data silos—look no farther than Acumatica’s financial management software. To learn more or to get help implementing, integrating, and customizing this software, contact our team of experts at ASI or schedule your free consultation with us today.