Question

Discuss the difference between corporate accounting and finance in the field of sports management. Provide one example of corporate accounting and finance from the sports industry and indicate why understanding sport economics is important for someone working in sports finance.

Answer 1

The difference between finance and accounting is that accounting focuses on the day-to-day flow of money in and out of a company or institution, whereas finance is a broader term for the management of assets and liabilities and the planning of future growth.Accounting is more about accurate reporting of what has already happened and compliance with laws and standards. Finance is about looking forward and growing a pot of money or mitigating losses. If you like thinking in terms of a longer time horizon you may be happier in finance than in accounting.The difference between finance and accounting may just be a matter of idle curiosity for some of us, but if you’re choosing a college major or a career, it’s an important distinction. Particularly if you’re planning to take on student loans, you probably want to be sure that you’re choosing the right path.

Let’s take a look at an example on the lower end of the scale. According to the BLS, the median pay for Bookkeeping, Accounting, and Auditing Clerks in 2014 was $36,430 per year, $17.51 per hour. The number of jobs is projected to decline by 8% between 2014 and 2024. As you can see, the field of accounting has both high-salary, high-growth jobs and lower-salary, negative-growth jobs.

Salaries in finance tend to be high, but there are exceptions. One example is fundraisers. The median pay for fundraisers is $52,430 per year, $25.21 per hour. However, the job outlook is for 9% growth between 2014 and 2024, still above average. The BLS puts fundraisers in the “Business and Financial” category, but many fundraisers don’t have a finance degree. (That may be one of the reasons for the lower pay).