AAC or Advanced Audio Coding is an audio file format with losses. It was designed in 1997. as an MP3 successor with improved encoding quality. Its main advantage and difference from MP3 is a great efficiency of encoding at both constant and variable bitrates.
M4R or iPhone Ringtone is the format of ringtones for mobile devices from Apple. This is the same format as M4A but with it has several limitations. The duration of the audio stream should not exceed 40 seconds. In case the duration is longer, iTunes does not install the ringtone on the mobile device.