In the whole of a company’s processes, financial management is responsible for establishing the policies to be implemented in order to achieve the general objectives set by the shareholders.
Financial management: The shaping of the concept within the general administration of a towing service company
The management activity of a company can be divided into the management of processes and operations and the management financial.
Financial management can also be seen as a branch of the general management of a company like Towing Service San Jose. The mission is to ensure that the towing company will benefit from the financial resources necessary for the activity and the achievement of the proposed goals. Also, this branch of management is responsible for distributing these resources from a strategic point of view in the areas of activity of a company and ensures the fulfillment of performance and efficiency objectives.
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The differences between financial and management accounting
A problem that can cause confusion among many entrepreneurs and even more experienced businessmen is the joining of the notions of financial accounting and management accounting, both of which are basic areas of financial management.
Accounting, in general, is the activity on which the entire financial management is supported due to the information it provides and on the basis of which decisions can be made at a high level. Accounting is, if you will, a system of correct and first important information in the activity of any company. However, this information is divided into two major flows: financial and management.
Financial accounting information is processed by financial accounting where they are converted and aggregated into financial statements and reports. It should be noted that this information primarily serves the external players of the company or company with which it has business relations based on legal obligations.
Management accounting information, on the other hand, is used in daily work to record current operations and transactions in which the company takes part. Management accounting, unlike financial accounting, works with a series of reports addressed mainly to internal use, necessary for company management to build an accurate picture at any time, based on which decisions regarding the future of the company are made.
The relationship between the two accounting activities is from part to whole. Thus, management accounting is the one that provides the raw basic information that is processed by financial accounting in order to prepare the mentioned reports.
