Try answering this question: Which of the following are essential for survival?
Water or Air?
If this question left you confused, because both water and air are essential for life, that’s exactly how this question is. Both Finance and Accounting go hand in hand and are essential for businesses. As a result, both offer great career opportunities that are on par with each other.
That being said, the careers in finance and accounting, within themselves are very different. Hence, one should make a well-planned and thought-out career choice based on their interests, likes, job market, and so on.
Finance:
Finance is the field that involves the management of money within an organization. Knowledge of accounts, coupled with business acumen and knowledge of reporting are the must-have skills for a person in finance. In terms of soft skills, interpersonal skills, communication ability, and problem-solving skills are necessary for a career in finance.
While numeracy skills are important in finance, they are more crucial for accountants.
In short, careers in finance involve a considerable amount of forecasting and planning for the future.
Careers in finance may include jobs such as:
- Investment banker
- Financial broker
- Financial manager or planner
- Financial advisor
- Financial analyst
Accountancy:
Accounting involves the identifying, recording, and communicating of an organization’s economic results. It is a very vital function for any business. Accounting measures business activities process the information into reports and communicate the results to decision-makers.
While many people consider accounting a subsect of finance, there is a considerable difference between the two. The work of an accountant includes creating journal entries, bank reconciliations, invoicing, and similar processes that relate to the daily operation of a business. They may also create quarterly and annual financial reports, analyze profitability, manage debt, audit internal transactions and report earnings.
In short, careers in accounting involve taking note of past transactions, and recording them for the sake of compliance, and so on. To be a successful accountant, one has to have a combination of accounting expertise, general business knowledge, and soft skills to be successful.
Careers in accounting include jobs such as:
Careers in accounting include:
- Auditor
- Bookkeeper
- Cost accounting manager
- Accounts receivable clerk
- Accounts payable clerk
- Controller
- Treasurer
- Technical accounting manager
- Tax accountant
- Chief finance officer
Accounting Vs. Finance
Although some skills required by professionals in accounting and finance are similar, there are some differences too. Accounting includes more components of quantitative analysis, internal auditing, income taxation, and accounting practices and methods. Accounting is more hands-on and process-oriented than finance.
On the other hand, finance involves mathematics-intensive and focused on financial markets, portfolio and investment management theory, financial management, investments, and security analysis and valuation. On the whole, finance tends to be more analytical and evaluative, and less numeracy-oriented than accounting.
What Should You Choose?
This boils down to what the students want to pursue. The bottom line is that both finance and accounting are lucrative and offer good opportunities. It ultimately lies in the hands of the student and market trends.