Accounting and Finance

Accounting and Finance

While accounting and finance may go together, there are key differences: accounting focuses the flow of money and out of a company or family, while finance is a more broad term that describes how one manages asset and liabilities. Whether you are considering different college majors or thinking about who to hire to help you manage your own finances, it is important to understand exactly what the two fields are and what specialists in each do. To find someone to help with your own money, consider using SmartAsset’s free financial advisor matching service.

Accounting vs. Finance

The difference between finance and accounting is that accounting focuses on the day-to-day flow of money in and out of a company or institution, whereas finance is a broader term for the management of assets and liabilities and the planning of future growth.

If you want to exercise high-level control over a company’s strategy, finance could be for you. If you want to take a detailed look at a company’s books you’re probably more interested in accounting. It’s often said that accounting looks back to a company’s past financial transactions, whereas finance looks forward to plan future acquisition of assets.

Accounting is more about accurate reporting of what has already happened and compliance with laws and standards. Finance is about looking forward and growing a pot of money or mitigating losses. If you like thinking in terms of a longer time horizon you may be happier in finance than in accounting.

If you want to study accounting you can expect to take classes in accounting practices and accounting ethics, business law, tax law and accounting theory.

Tips for Accounting and Finances

  • If neither finance nor accounting is up your alley, you might consider finding a financial advisor to help you with all your money issues. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool connects you with financial advisors in your area in five minutes. If you’re ready to be matched with local advisors, get started now.
  • One basic aspect of finance you can do yourself is making a budget. Use SmartAsset’s budget calculator to get a start on yours!