Finance vs Accounting (2024)

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Written byTim Vipond

Finance vs. Accounting Career Guide

This guide will analyze the key similarities and differences between finance vs. accounting careers. For university graduates, these are two of the most common options, and each offers a rewarding career path for unique reasons. Please explore the guide below to plan your career accordingly!

Finance

Finance is the management of money and investments for individuals, corporations, and governments. Finance professionals work in careers such as investment banking, wealth management, and financial planning and analysis (). Whether these professionals work on behalf of individuals or businesses, they are responsible for ensuring that there is adequate funding (capital) for the needs of the situation and that the funds are allocated as optimally as possible. Their job is to create value by managing capital in a way that earns higher than expected risk-adjusted returns.

Accounting

Accounting is the recording, maintaining, and reporting of a company’s financial records. Accounting professionals work for individuals, in-house at corporations, or on behalf of other businesses at a public accounting firm (such as the Big Four). These professionals are responsible for ensuring that all financial transactions are correctly entered into the general ledger, that account balances are correct, and that financial statements are accurate.

Finance vs. Accounting Summary

Below is a summary of the main differences you should be aware of:

	Accounting	Finance
Clients	Individuals, businesses, governments	Individuals, businesses, governments
Main Employers	Public accounting firms, corporations	Banks, corporations
Financial Statements	Responsible for preparing them	Responsible for analyzing them
View Point	Backward looking	Forward looking
Focus	Accuracy, reliability	Insights, analysis
Business Purpose	Communicating the financial position	Figuring out how to add value
Thought Process	Rules based	Analysis based
Attention to Detail	High	High
Designations	CPA	MBA, FMVA

Employers and Clients

Both accounting and finance professionals have clients that are individuals, corporations (businesses), governments, and non-profits. When it comes to their employers, however, there are significant differences. The most common types of employers for each group are listed below.

Finance

Banks (retail, commercial, and investment)
Insurance companies
Research companies
Operating companies (regular businesses)

Accounting

Role with Financial Statements

There are some major differences in the ways finance vs. accounting professionals work with financial statements – accountants are primarily responsible for creating them, while finance professionals are primarily responsible for analyzing them.

If you enjoy collecting and organizing large amounts of data, such as all of a company’s invoices, receipts, and financial records, then being an accountant could be a good fit for you.

If you prefer analyzing and interpreting information to show how well a company is performing or coming up with ideas about how it could do better, then finance could be right for you.

Types of Finance vs. Accounting

Below is a detailed comparison of the various types of each profession.

Finance

Personal
Corporate
Public
Behavioral
Social

Accounting

Financial
Public
Forensic
Management
Tax
Audit

Backward vs. Forward-Looking

Accountants, by nature, are backward-looking because they take historical financial information to prepare their reports. By the time their reports come out, the figures could be several months old.

Finance professionals, by contrast, are forward-looking because they have the nearly impossible task of trying to predict the future.

If you like studying the past, that could be a good sign you’d enjoy accounting work, while if you enjoy trying to think about the future will hold, you may prefer finance work.

Personality Differences

One of the biggest differences in accounting vs. finance careers is the types of personalities that are drawn to each of them.

Finance

Analytical
Inquisitive
High attention to detail
Thinks about scenarios
Concerned with adding value
Business development skills
Problem-solving

Accounting

Accountable
Detail-oriented
Rules-based thinking
Risk management
Procedure-oriented
Concerned with accuracy

Corporate Functions

Below are the primary corporate job functions and responsibilities for each of the respective professions.

Finance

Funding the business
Raising capital (debt and equity)
Optimizing the firm’sWeighted Average Cost of Capital
Seeking the best risk-adjusted returns
Corporate strategy
Budgeting and forecasting
Mergers and acquisitions

Accounting

Bookkeeping
Tracking of revenues and expenses
Internal reporting
Financial reporting
Auditing
Risk management

Finance vs. Accounting Decision

The finance vs. accounting decision can be a tough one, especially if you haven’t worked in either industry before. At the end of the day, you should carefully consider all of the information provided above – including all the similarities and differences – and decide which option best fits your personality, your interests, and your goals.

In order to help you with the decision, this additional reading will be helpful:

Analysis of Financial Statements
Finance Interview Questions
Accounting Interview Questions
Salary Guides
See all career resources

FAQs

Finance vs Accounting? ›

What is the Difference Between Finance and Accounting? Accounting is a narrower field that focuses on professional processes to manage numbers and accounts, while finance uses the same information to analyze potential growth patterns in order to strategize company finances.

Which is better, finance or accounting? ›

The field of finance offers more career choices but also less predictability. In some cases, careers in finance might offer higher pay. Careers in accounting can offer more predictable and stable work but less pay in many cases.

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Are accounting and finance the same? ›

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.

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Who earns more finance or accounting? ›

The National Association of Colleges and Employers conducted an analysis and determined that the average annual salary for accounting degrees in the United States is generally around $57,511, and the average annual salary for finance degrees is $58,464.

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Is it easier to find a job in finance or accounting? ›

The finance industry is more competitive than accounting, so it's harder to get a job in finance. Higher risk of job loss. If you choose a career path in accounting and your company goes bankrupt or closes down, you can find another job easily because there are many companies that need accountants.

Is a CPA good for finance? ›

A CFO does not need to have a CPA, CFA, or MBA designation. But of the three, having a CPA designation does help dramatically . I've passed the CPA, and I can say that it is the most important designation to have if you're considering being a CFO.