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الخميس، 14 يناير، 2016

CMA vs CPA - What's in a name?

There are several accounting designations, but two of the most common are the CMA and CPA. 

As a CMA myself, I am frequently asked why I chose this path over becoming a CPA. While my decision was a personal one, it was made because I understood the differences between the two designations. 

Not surprisingly, there tends to be quite a bit of confusion so I figured the best thing to do would be to break down the key components, so you can make an informed decision on which is best for you.

CMA vs CPA Salary

Choosing to further your financial career by committing to the CMA or CPA is not to be taken lightly, and one of the key factors you will want to consider is salary. 

Below is a brief chart broken down by designation and the average salary made by individuals within a specific age range. 

CMA vs CPA Salary Chart

[source: Crush the CPA Exam]

As you can see, from ages 30-49, the average CMA makes significantly more than their CPA counterparts. Though several things can influence your salary, there’s no denying that it is profitable to choose CMA in your earlier years. 

CMA vs CPA Requirements

To help differentiate the two designations I have provided a chart below to show the differing requirements:




At one point the CMA exam was a four-part exam just like the CPA. That was until the IMA (Institute of Management Accountants) decided to condense them into only two parts. In large part to this decision, the exams became a lot harder as it now had to cover much more content in each exam. 




Though a deterrent to many, one of the reasons I chose to become a CMA was the fact that it went from a 4-part to a 2-part exam. Another reason was prior to obtaining my CMA credential, I was working as a Corporate Controller. This position allowed me to fulfill the financial management experience requirement for the CMAs. If I chose the CPA, I would have needed to find another job where I could work under a CPA for a year or two, and that wasn’t an option I was interested in.



Finally, learning about taxes and performing audits did not appeal to me. I do, however, have many colleagues who enjoy working in both of those fields. The trick is deciphering which certification is best suited for you by understanding which areas in accounting or finance you can see yourself working in. More importantly, you want to choose a path that allows you to work in an area you truly enjoy.



CMA vs CPA Exam Content



Simply put, the CMA focuses on business analysis and strategy, and corporate financial management. The CPA focuses on taxes, compliance, financial reporting and audit.



Both exams are designed to test candidates knowledge of each designations core strengths and this could be considered the main difference between CMA and CPA.



As far as testing goes, here is what is covered in each Part for both the CMA and CPA exam.




As I was already working in management accounting, it was fitting for me to obtain the CMA versus the CPA. Along with the above core differences and the fact that I prefer to work in private accounting, the CMA made more sense for me personally.

Feeling like a management accounting career is best for you? Then keep your eyes peeled for my next email because there is more than one management accounting certification and things can get a little confusing.

Looking for More?

I love sharing my weekly emails with you on exam strategies, coaching support and all CMA-related topics for free. 

If you enjoy these articles and are looking for even more great resources, here are some links to other posts, projects, and tools that will help you accelerate your path to your CMA designation.


As always, thanks for reading,
 
Nathan Liao
-- Nathan Liao, CMA
 
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