Finance and accounting may seem like similar disciplines at first glance, but there is a world of difference between the two. Finance deals with managing money and investments to maximize returns, while accounting focuses on recording financial information and preparing reports.

Both finance and accounting are important for businesses, although they serve different purposes. While finance helps determine how funds should be allocated to achieve maximum profitability, accounting provides an accurate record of current assets, liabilities, income, expenses and other financial transactions. Knowing the differences between finance vs. accounting can help you make informed decisions when it comes to managing your business finances or deciding your career path.

What Is Finance?

Finance is the process of managing money and investments in order to generate an optimal return on investment. It involves analyzing financial data, forecasting future trends, and making decisions about investments, acquisitions, capital budgets and other finance-related activities. Finance encompasses both short-term and long-term objectives, as well as the overall financial strategy of a business.

What Is Accounting?

Accounting focuses on the recording and summarizing of financial transactions that have already occurred. It involves tracking income, expenses, assets, liabilities, equity and other financial data in order to provide an accurate picture of a company’s current financial situation. Accountants use this information to prepare reports such as balance sheets, income statements and cash flow statements. Accounting is an essential part of finance because it provides the data needed to make sound financial decisions.

What Can You Do With a Finance Degree?

With a finance degree, you can pursue finance-related career paths such as financial analyst, investment banker, financial advisor and wealth manager.

Financial analysts assess the performance of investments and recommend strategies to maximize return on investment. Investment bankers advise companies or organizations on capital raising and mergers and acquisitions. Financial advisors manage investments for their clients to help them reach their financial goals. Wealth managers provide comprehensive financial advice that may include tax planning, estate planning, retirement planning, investment management and budgeting.

In addition to these finance-focused jobs, finance degrees also prepare you to work in other industries such as banking, insurance and real estate. Positions like loan officer or underwriter in the banking industry involve analyzing borrower applications and determining creditworthiness before approving loans. Insurance agents help individuals select the best insurance coverages for their needs while real estate agents help buyers find properties that meet their requirements.

Finance majors can also pursue higher education such as a master’s degree in finance or an MBA with a finance concentration. These programs allow students to specialize in areas such as corporate finance, investments, risk management and portfolio theory. With advanced training in finance, graduates are prepared for executive positions including chief financial officer (CFO) roles within corporations or consulting firms as well as positions at government agencies or nonprofit organizations.

What Can You Do with an Accounting Degree?

With an accounting degree, graduates can pursue a wide range of finance and accounting-related career paths. Accountants are needed in all types of organizations to track financial information and prepare reports. They may work in public, private, or government organizations, as well as in the finance departments of companies. Certified Public Accountants (CPAs) perform more specialized tasks such as providing advice on taxation and auditing financial statements. Cost accountants keep track of costs associated with different projects or processes in order to maximize efficiency and profitability. Tax accountants specialize in preparing tax returns and helping individuals and businesses comply with applicable laws and regulations.

Management accountants provide important financial information to decision-makers within a company by analyzing internal data such as budgets, product costs, expenses and inventory levels. Forensic accountants use their investigative skills to detect fraud or other irregularities in financial statements. Financial analysts use financial data to provide guidance for investments and other finance-related decisions within an organization. Additionally, finance professionals may also work in finance departments of companies where they are responsible for budgeting and forecasting.

No matter what type of finance or accounting-related career path one chooses to pursue, having a degree in accounting can open many doors for individuals who have the necessary skillset required for the position. With a strong understanding of finance principles as well as knowledge of advanced accounting principles, individuals can be successful working in both public and private sectors as well as higher education institutions. Furthermore, having an accounting degree will help individuals better understand how their business works on a day-to-day basis while being able to make informed decisions which can lead to greater success both financially and professionally.

Finance vs. Accounting: Which is Right for You?

When it comes down to choosing between finance and accounting, individuals should take into consideration what type of job they would prefer along with their skillset as well as personal interests and goals. Finance jobs typically involve more analysis while accounting jobs tend to focus more on accuracy with data entry involved in many positions. Both finance and accounting offer great career paths that can lead to success professionally and financially. However, it ultimately depends on an individual’s preferences when deciding which one is right for them.

Accounting & Finance Career Opportunities

If you’re looking for career opportunities in the finance or accounting fields, contact Burchard & Associates. We help accounting and finance professionals find career opportunities in the St. Louis area and beyond. Check out our available jobs or contact us today to learn how we can help you with your job search.