Are accounting and finance the same thing?

by Farooq
(Pakistan)

Question from Ask the Expert!


I would like to ask you -Are accounting and finance same thing?

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Yes and No.

Without consulting a dictionary, just off the top of my head...

The term Accounting refers to the posting, summarizing, and reporting of financial information for a business.

The term Finance in a corporate setting refers to the department in that entity that handles all decisions and activities that deal with the firm's money.

Most times when we use the term Finance we're usually dealing more with investments, stocks and bonds, interest, distributions, etc.

Accounting deals with the firm's revenue and expenses, profit, assets, etc.

But in a corporation, you will have a VP of Finance, then a Controller, then your Accounting department, in that order. So Accounting is part of the Finance Department in a large corporation.

Does that make sense?


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