Though finance and accounting appear like the same domain, they have a lot of differences in their nature and scope of work. Pursuing a career in the financial field is a great choice, but you have to be aware of the different degrees available in that field. Accounting and finance have a lot of similarities as well, but they are not the same. In this blog, we will look at finance vs accounting and its similarities and differences. 

Finance vs Accounting: The definition

Finance focuses on managing one’s assets and liabilities while accounting deals with the day-to-day cash flow of a company or individual.

Finance is the process of managing all the investments and money-related activities of an individual, company, or government. Professionals in this field focus on investment banking, financial planning and analysis, and wealth management. 

Accounting is the process of recording, tracking, and reporting the company’s records of financial transactions. Accountants are responsible for checking whether all the transactions are carried out correctly and recorded in the ledger properly. 

Main focus

Finance predominantly looks forward to improving the financial status of the company and mitigating the losses that occurred. Whereas, accounting primarily focuses on reporting the past performance of the company and checking whether they are in compliance with the laws and standards. 

If you need a strategy that can improve the company’s status and plan future investments at a high level, finance is the best choice for you. On the other hand, if you want to look over your financial transactions that occurred in the past and to take a comprehensive look over your company’s books, accounting is there for you.

Finance vs Accounting: Comparing the tasks 

Finance is a more generalized and vast field and has its primary tasks that are different from accounting. Let us look at the primary tasks to carry out by the financial and accounting professionals. 

Finance- Primary tasks

• Finance professionals should invest time in researching the amount that the company is going to spend on raw materials, hiring employees, production of a product, and more. 

• They should look for sources of funding for the organization and also for negotiating loans.

• These professionals should work on how to get the maximum return of investment for the company and they focus more on building the company’s competency.

• They help in decision-making in finance-related activities of the business. They help to decide whether the company should reinvest into a business, whether to share the profit to their shareholders, etc.

• Communication is an essential skill for finance professionals. They have to clearly communicate the suggestions for making decisions to the top management to get their approval. 

Accounting- Primary tasks

• Accounting professionals help in managing the resource contribution from various business areas. This will help in gaining the clarity to decide about the resource allocations.

• Accountants have a proper record of transactions and payments made to the creditors.

• Accountants take care of the contracts. They check whether the contracts are fulfilled or not.

• Their job is to maintain the business’s transparency. They have to be transparent about the financial position of a company to the public and the government.

Career options

If you are choosing a career in accounts or financing, you should have a clear understanding of the career choices in both fields. 

If you choose your career in the field of accounting, you will be more likely to report the financial transactions and their related information to the chief financial officer. In the field of accounting, the company can provide jobs like tax manager, controller, fund accountant, bookkeeper, auditor, and more.

If you choose finance as your career, you will work in corporate or consulting finance. You will have job options such as financial analyst, financial examiner, personal financial advisor, investment banker, and more.

Skills required for finance and accounting 

Like every other job available nowadays, finance and accounting professionals have to acquire some skills to effectively shine in their field. 

Finance professionals should have skills such as blog, communication, interpersonal skills, problem-solving, financial reporting, business acumen, and analytical expertise.

Accountants should have relevant skills such as Excel, SQL, MS Visual basic, ERP, business intelligence. They also should possess soft skills such as communication, customer service, and leadership.

Key differences: Finance vs Accounting

Features	Finance	Accounting
Types	Personal financeCorporate financePublic finance	Financial Managerial Cost accounting, etc.
Careers	Corporate finance, investment banking, corporate finance, project finance, technical analysis, etc.	Public accounting, forensic accounting, bookkeeping, treasurer, accounts receivable clerk, etc.
Education	Bachelor in accountancy, finance, mathematics, economics, and more.	Bachelor or masters in accountancy, CMA, CA, CPA, and more.
Financial statements	They prepare financial statements.	They analyze the financial statements
Skills to focus	Reliability, accuracy	Analysis, insights
Types of employers	Banks, research companies, insurance companies, and operating companies	Public accounting firms, operating companies, and tax filing firms
Main focus	Is on adding value	Is on keeping accuracy
Thinking	Rules-based thinking	Analysis-based thinking
Networking	They work within the industry and have the strongest alumni network.	They don’t have many networking opportunities.

Pros and cons: Finance vs Accounting

	Pros	Cons
Finance	Greater number of opportunities in this field. Technical skills are much needed tan personality traits. No need to travel often.	Compensation is based on your performance. If you want to get a higher income, you have to work more. Work pressure is said to exist. Work-life balance depends on the work.
Accounting	In this field, there are many different careers. It provides a great work-life balance. You have a variety of options to choose such as auditor, tax consultant, management accounting, etc.	It is a narrow domain. You cannot do specialization more in a field.

Conclusion 

Though finance and accounting sound similar, they do have their own similarities and differences based on their work nature, work-life balance, compensation, skills, types, and more. This blog would help in understanding finance vs accounting, their differences, similarities, scope of work, primary tasks of the professionals, and also the pros and cons of the two fields.