Cost accounting is the process of tracking, recording and analyzing costs associated with a company’s product or project. Cost accounting information primarily used for internal managers, rather than external auditors. Costs are measured in terms of Direct Costs, Indirect Costs and Overhead/Absorbed Costs. Managers use cost accounting to support decision making to reduce a company's costs and improve its profitability.
Management accounting is concerned with the provisions and use of accounting and other information to managers within organizations, to provide them with the basis in making informed business decisions that would allow them to be better equipped in their management and control functions. Unlike financial accountancy information (which, for public companies, is public information), management accounting information is used within an organization (typically for decision-making) and is usually confidential and its access available only to a select few.
Cost Accounting actually operates within Management Accounting. Management Accounting evolved from cost Accounting as businesses became more complex and diversified, Thus, more comprehensive data was needed in order to help management make decisions, rather than the typical Product Costing reports. Management Accountants are also involved in other accounting related functions such as Long Term Planning, Budgeting and Forecasting. Again, cost accounting data is used to as part of the process, however, other analyses are also part of the Management Accountant’s role.