6 Branches of Accounting and Accounting Standards

Financial Accounting

• Financial Accounting maintains a record of business transactions to - Find - Profit / Loss and Financial Status of the business. 

Cost Accounting 

• Cost Accounting relates to the collection, classification, ascertainment of cost of operations . 

• It relates to various elements of cost (material, labor and over heads). 

Management Accounting 

• Management Accounting means use of accounting data collected from financial accounting and cost accounting for formulation of policy, planning, control and decision making by management. 

• The objective of management accounting is to help the management to take rational policy decisions and to evaluate the impact of its decisions and actions. 

Accounting Standards 

• Accounting Standards are formulated with a view to harmonize different accounting policies and practices in use in one country.

• The objective of Accounting Standards is, therefore, to reduce the accounting alternatives in the preparation of financial statements within the bounds of rationalist.

• The Accounting Standards are issued by the ICAI in India.