Which type of accounting does not adhere to GAAP?

Managerial accounting is primarily focused on providing information to internal users, such as management, to aid in decision-making, planning, and controlling operations. Unlike financial accounting, which adheres to Generally Accepted Accounting Principles (GAAP) to ensure consistency and comparability of financial statements for external users, managerial accounting does not have to follow these established standards. This flexibility allows managers to tailor reports to meet their specific needs, employ different formats, and focus on relevant data that might not be captured in financial statements guided by GAAP. Thus, the nature of managerial accounting is more about internal decision-making rather than external reporting, making it distinct from financial and tax accounting practices, which do align with GAAP.