CAT / FIA FFA Syllabus A. The Context And Purpose Of Financial Reporting - Nature, principles and scope of financial reporting - Notes ^{5 / 6}

Financial accounting is mainly a method of reporting the results and financial position of a business. It is not primarily concerned with providing information towards the more efficient running of the business. In fact, financial accounting provides historical (past) information.

Management need to plan for the future. They require detailed information as they are responsible to plan and control the resources of the business.  Management (or cost) accounting analyses data to provide information as a basis for managerial action