aren't managerial reports mainly for internal use where financial reports are used for external? Could someone explain

Yes, you are correct. Managerial reports are primarily used for internal purposes within an organization, while financial reports are typically used for external stakeholders. Let me explain further.

Managerial reports, also known as management reports or internal reports, are prepared by managers and leaders within an organization to provide valuable insights and information for decision-making and performance evaluation. These reports focus on the operational aspects of the business, such as sales, production, inventory, and cost analysis. They may include budget reports, performance reports, variance analysis, and forecasts. Managerial reports help managers monitor the progress of their department or team and make informed decisions to improve efficiency, productivity, and profitability.

On the other hand, financial reports are primarily prepared for external parties like investors, creditors, and regulatory authorities. These reports provide a comprehensive overview of a company's financial position, performance, and cash flows. Financial reports follow standardized accounting principles such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS). They include financial statements like the balance sheet, income statement, and cash flow statement, along with footnotes and disclosures. Financial reports help external stakeholders assess the financial health and stability of a company and make investment or lending decisions.

While there may be some overlap in the information included in managerial and financial reports, the key distinction lies in their intended audience. Managerial reports are primarily used by internal management, whereas financial reports cater to external stakeholders who have an interest in the financial performance and stability of the company.

To summarize, managerial reports focus on internal decision-making and operational performance, while financial reports provide a company's financial information to external stakeholders for evaluation and decision-making purposes.