The connection between accounting and finance (economics)

Finance is a tool, accounting is a language, and economics is a goal. The financial behavior of an enterprise is the core content of financial management, and financial management must be based on correct financial accounting (i.e. accounting) in order to achieve the purpose of correct management.

First, from a personal point of view, the simple understanding of accounting is to record, calculate, analyze, predict, evaluate, manage and fund-related activities of the company in the operating process, and provide decision-making basis for management. Finance is the financing of funds. The research is divided into two situations, one is how to finance when there is a shortage of funds, and the other is how to transfer risks when there is a fund surplus so that the value of funds can be maintained and increased. Accounting serves company management, while finance serves enterprises. Accounting and finance are integrated and complementary to each other.

Second, in many fields, finance and accounting are closely linked. For example, accounting knowledge will be tested in the finance exam, and financial knowledge will also be involved in the accounting exam. In actual work, especially in high-level corporate positions, accounting and finance will be integrated. It is almost impossible for modern financial personnel not to understand financial knowledge, and it is impossible for financial practitioners to become financial analysts without understanding accounting, but the focus of the two is different.

Three, let’s talk about the difference between finance and economics. Accounting belongs to another category. In a broader sense, finance belongs to the field of economics research. Finance is the study of economic activities in the financial currency circulation market (such as futures, stocks, bonds, insurance, banks, venture capital, etc.). The major of economics research covers a wide range of subjects, focusing on the analysis of macroeconomic activities and generally not targeting specific practical economic subject areas. From the perspective of employment prospects, finance is suitable for major investment banks and securities companies, while economics is more suitable for academic research in various social science research institutes.

4. Finance: Finance is an applied discipline under economics. When the economy had not developed to a certain level, there were no finance majors (such as financial engineering) because there was no finance at that time. Demand markets for products and financial services. Economics controls things from a macro perspective, while finance is more micro-practical, focusing on the financing and operation of monetary funds. Finance aims to cultivate professionals with theoretical knowledge and business skills in finance who can engage in related work in banking, securities, investment banking, insurance or other economic management departments.

5. Economics: Economics discusses the basic concepts and principles of economics, as well as the general laws of economic operation and development, and provides basic theories for various economic disciplines. Theoretical economics is usually called general economic theory, which is divided into two branches: macroeconomics and microeconomics. Applied economics mainly refers to the application of the basic principles of theoretical economics to study the regularity of economic activities and economic relationships in various departments and professional fields of the national economy, or to analyze the economic benefits and social benefits of non-economic activity fields. discipline. There is not a big difference between economics and finance majors in the job market. When many companies recruit, they will indicate that economics-related majors can apply. Therefore, if you major in economics, you don’t have to worry about not being able to get in in the future. Banks, etc., where you can study basic finance, economics can also be studied.