Branches of Accounting

1. Financial Accounting
2. Cost Accounting
3. Management Accounting

1. Financial Accounting:

It is a process of recording, classifying, summering, analyzing, interpreting and communicating financial transactions and events. The purpose of this branch of accounting is to keep systematic records  to ascertain financial performance (profit and loss account) and financial position (balance sheet) and communicate the accounting information to the interested parties.

2. Cost Accounting:

It is process of accounting and controlling the cost of a product. Service, function or an operation. The purpose of this branch of accounting is to:

• Ascertain the cost of various products and services.
• Controlling the costs
• Communicate cost related information for decision making

3. Management Accounting:

It is the application of accounting techniques for providing information to assist the management in the formulation of policies and in planning and controlling the activities of the business enterprise.