Overview
In the accounting environment, the following distinction of functional purpose is common:
- Financial accounting Accrual based, double entry, based on GAAP or equivalent rules. Purpose: Presenting a financial picture to externals
- Budget accounting Accrual or cash based, double or single entry. If used for external representation, rules differ from commercial GAAP rules
- Controlling Accrual based, double entry. Used to manage an enterprise. SAP assumes there are only academic approaches, no legal framework.
- Consolidation (not a topic here)