You love numbers, want to pursue a career in business and know you want to study accounting … but, hold on, isn’t finance a better choice?
The good news is that both are great choices but if you put them in the ring, finance vs. accounting, which one would come out tops?
Truth is, there are no winners here. Finance and accounting are two different fields of study and very different careers. It’s important to understand the differences so you can choose a path that matches your skills, interests and career goals.
Clearly, both offer a wide variety of career possibilities, but the most important factor to consider is your own personality.
What’s the difference between the two?
The quick answer is that accounting is focused on concrete numbers in areas such as budgets, audits and taxes, while finance is wider in scope, covering specializations in business, economics and banking.
Accounting and finance are, however, two sides of the same coin. Accounting is a narrower field focusing on managing numbers and accounts, while finance uses the same information to analyze potential growth and strategize company finances.
Put simply, accounting analyzes the past, and finance analyzes the future. Accounting is reactive and manages current revenue flow, while finance tends to be predictive and looks to what can happen in the future.
The accounting vs finance question, therefore, really comes down to what you think you are best suited for. Do you want to manage numbers, or do you think you would be better at influencing them? Another important question is, which area of study do you think is best for you?
The curriculum is different
Although there is certainly an overlap in coursework for finance and accounting degrees, the curriculum for a finance degree tends to focus more on mathematics and financial markets, and portfolio and investment management. Courses unique to finance degrees include: Banking, Microeconomics, Macroeconomics, E-business, International Finance, Risk Management, and Venture Capital.
The curriculum for an accounting degree focuses more on quantitative analysis, auditing, taxation and accounting. You will probably end up taking less electives than finance majors since there are more required classes for accounting majors. Courses unique to accounting degrees include: Accounting, Personal Taxes, Business Taxation, Auditing, and Fraud Auditing.
What can you do with an accounting degree?
An accounting degree will teach you skills such as balancing ledgers, understanding financial statements, and managing accounts payable & receivables. You have the flexibility of working with individuals or companies. You will focus on the day-to-day cash flow and keeping financial accounts, including budgets, audits, and/or taxes.
What can you do with a finance degree?
A finance degree prepares you to manage financial statements, financial forecasts, and make economic plans, models, and analysis. This degree is more general, and therefore can be applied to several financial fields.
A finance degree will teach you how to use money to make more money and gives you the tools to make realistic forecasts when managing investments.
Which degree is right for you?
How do you see yourself? Do you see yourself in a career that involves a lot of bookkeeping, keeping detailed records, and helping businesses stay financially organized? Or do you see yourself analyzing the industry, making forecasts, and finding ways to make a profit?
The answer to this question will help you determine which of these two degrees is right for you.
Finance vs Accounting: Top Jobs
Finance involves the management of money that can encompass anything from corporate finance to personal financial planning. Common jobs in the finance world include:
- Financial Analyst
- Financial Advisor
- Financial Broker
- Hedge Fund Manager
- Investment banker
Common places of employment for finance jobs include:
- Banks and Credit Unions
- Mortgage Institutions
- Finance Companies
- Regulatory Agencies
Those who work in accounting track and report the financial transactions of a business and often manage the general ledger, cash flow and tax obligations. Common jobs in the accounting world include:
- Management Analyst
- Tax Examiner
Common places of employment for accounting jobs include:
- CPA Firms
- Public Accounting Firms
- Corporate Businesses
- Tax Agency
Why Choose One Degree Over the Other?
You don’t have to. Some universities offer integrated programs or joint accounting-finance degree programs; but the answer to this question largely lies within your future career choice.
Consider what you want to do as a profession and base your degree on that. You may choose to follow the double-major path and a joint finance/accounting degree may be your golden ticket. This gives you the widest range of knowledge and a resume that swings doors open for endless opportunities.