Dear reader, you are welcome to an enlightening CMA vs CPA vs CFA session.
You’ll learn how the CFA differs from CMA and CPA in focus areas, career opportunities, and salaries.
In this article, we’ll explore the following concepts:
Without much ado, let’s hit the ground running!
Overview of CMA vs CFA vs CPA
CMA, CFA, and CPA are the most-revered credentials in the business environment.
Professionals with these certifications have the edge over others, stand a chance of improved career prospects, and get higher compensation.
Career focus is the essential difference between CMA, CPA, and CFA professionals.
While a CMA specializes in management accounting, a CFA focuses on finance and investment, and a CPA in finance and general accounting.
Although they all operate within the finance industry, they possess different skill sets.
We’ll discuss an overview of these certifications to lay a solid foundation for our discussion.
The Institute of Management Accountants (IMA) confers the Certified Management Accountant (CMA) credential on professionals.
The CMA is a globally-known certification for management accounting experts.
CMAs prepare business reports to aid the decision-making process.
Certified management accountants are into cost controlling, budgeting, strategic decision-making, business analysis, and financial planning.
A CMA makes well-informed business decisions about a firm’s financial situation through analysis of the business and accounting status of the firm.
Management accountants function well in leadership positions because of their decision-making ability.
Thus, they occupy the top echelons in the accounting industry.
On the other hand, the CFA Institute organizes and issues the chartered financial analyst (CFA) certification.
A CFA is an expert who specializes in finance and investment management.
The CFA program is thorough and highly demanding; hence, you must be disciplined to complete the program and meet the experience requirements.
Financial analysts’ financial analysis skills make them perfect for audit firms, risk management companies, insurance companies, asset management firms, commercial banks, and consulting outfits.
The typical job profiles of CFA charterholders include portfolio managers, wealth managers, investment managers, entrepreneurs, research analysts, asset managers, and risk managers.
However, the American Institute of Certified Public Accountants (AICPA) is in charge of the CPA credential.
A CPA is a licensed accountant who has fulfilled the experience requirements, met the state boards’ educational requirements, and passed the CPA exam.
The AICPA works closely with the National Association of State Boards of Accountancy (NASBA) to ensure excellence in issuing this license.
The CPA license symbolizes excellence, credibility, and expertise in the accounting profession.
The license is the cream of the cup for accounting professionals.
If you’ve always dreamed of a fulfilling and rewarding finance career, earning a CPA license is sacrosanct.
Besides consulting, CPAs are also into auditing, tax filing, tax preparations, and financial accounting.
The typical job profiles of CPAs include auditors, forensic accountants, business consultants, financial advisors, forensic accountants, tax professionals, public accountants, and chief financial officers (CFO).
If you’re still confused about the certified management accountant vs CPA debate, here is a simple caveat: CMA focuses on financial management, while CPA encompasses every aspect of accounting.
Hence, you may consider earning the CPA first to bolster your accounting career.
CMA vs CPA vs CFA Salary
Before going further, let’s glimpse CFA vs CMA vs CPA salary.
The size of an organization, years of work experience, geographical location, and personal commitment to service are the main factors affecting individual earnings.
However, here is a round-up of the national average:
CFA/year | CMA/year | CPA/year |
|
National Average: $97,000 Lowest Earners–$68,000 Highest Earners–$300,000 |
National Average: $94,000 Lowest Earners– $57,000 Highest Earners–$240,000 |
National Average: $69,901 Lowest 10%–$50,000 Highest 10%–$117,000 |
Bonuses, profits, and compensations also affect their earnings.
However, don’t allow salary to be the main deciding factor for you.
The impact you aim to make, and your passion should determine the direction you’ll take.
While the CPA earnings may appear small, some CPAs earn more than some CMAs and CFAs.
Thus, let your career choice lead you to fulfillment!
Requirements for CMA vs CFA vs CPA
Anyone aspiring for any of the three accounting certifications must meet some educational and professional qualifications.
Each organizing body has its guidelines that aspirants must follow strictly.
Below are the requirements for each certification:
CMA Requirements
Every candidate must be an active member of the IMA.
You must pay a nonrefundable CMA entrance fee of $250 before you can become a member of the Institute.
Students pay $188 to be part of the IMA.
However, the Institute of Management has announced that the membership fee for professionals will increase to $280 from Mar 01, 2022, while students will pay $210.
A CMA candidate must have earned a bachelor’s degree from a reputable institution or an IMA-endorsed credential.
If you have a bachelor’s degree, ask your school to email your official transcripts to the Institute of Management Accountants.
But if you have a professional certification, the issuing body should send official letters to the IMA on your behalf.
Verify your educational status within 7 years of taking the CMA exam.
Professionally, you should have worked in financial management or management accounting for a minimum of two consecutive years.
Candidates should have full-time experience.
But you can still apply for the CMA certification if you serve in a part-time role for a minimum of 20 hours weekly.
However, part-time roles for two years count as a year.
In other words, you must have 4 years in part-time management accounting or financial management to meet the experience requirements.
Also, lecturers can use full-time finance or accounting teaching at an advanced level as an experience requirement.
Then, register for and take CMA exam parts 1 and 2.
Consent to the statement of ethical professional practice of the Institute.
The code of ethics aims to ensure that every certified member doesn’t do anything unprofessional.
Certified members must complete 30 hours of continuing education (CE), including 2 hours on professional ethics annually to maintain their certification.
CFA Requirements
The CFA designation is the gold standard of finance certifications.
Thus, its requirements are rigorous and demanding.
You must enroll in the program by joining the CFA Institute.
You must submit 2-3 reference letters before the Institute can accept you into the program.
An aspirant must have a bachelor’s degree or be in their final year (with a maximum of eleven months to graduate).
A candidate must also have 4,000 hours of work experience in a full-time position, whether related to investment or not.
Register for CFA Level I exam after meeting the eligibility requirements.
Note that if you don’t pass an exam level, you can’t take the next.
Before becoming a charter holder, you must pass CFA Levels I to III exams.
You must also have 4 years of work experience related to investment.
Remote, part-time, and full-time jobs are done before, during, or after passing the CFA exams to qualify for experience requirements.
You must also complete the ethics exam before certification.
CFA charterholders must also complete 20 hours of continuing education annually to keep their designation active.
CPA Requirements
Each state determines the requirements for the CPA license.
Hence, if you want to earn this certification, check the specific requirements with your state board of accountancy.
When you know the educational and experience requirements of your preferred state of practice beforehand, you’ll know how best to satisfy the requirements.
Becker has dutifully listed the requirements per state on its website.
However, every state demands a bachelor’s degree from an aspirant with a minimum of 150 credit hours.
Some states allow aspirants to take the CPA exam with 120 study hours while expecting them to complete the remaining 30 before applying for a license.
The states also highlight the amount of accounting-related studies you must take to qualify for the CPA exam.
For instance, Illinois requires 30 study hours in accounting-related courses such as taxes, financial accounting, auditing, and managerial.
However, other states such as California and Maine focus more on the accounting coursework.
They have more stringent requirements for business and accounting courses.
Some states also have minimum age requirements for the examination.
Such jurisdictions don’t allow anyone under 18 to take the CPA exam, but you must be 21 to earn a CPA certification in Missouri and New York.
Most states require that you participate in an ethics exam.
Most ask candidates to pass the exam within a year or two after the CPA exam.
The ethics exam is simple, and authorities expect you to have at least a 90% score in it.
Also, candidates must have a minimum of 2 years of public accounting experience before certification.
However, if you feel these requirements are too many, you may go for similar certifications like the certified financial accountant or association of chartered certified accountants (ACCA).
Here’s the summary of CPA CMA CFA requirements:
CMA | CFA | CPA |
|
Ø Register as a member of the IMA. Ø Pay the CMA entrance fees. Ø Fulfill the education requirements. Ø Meet the professional experience requirements. Ø Ace the CMA examination. Ø Complete 30 hours of CE (with 2 hours in ethics) to retain the certificate. Ø Consent to IMA’s policy on professional conduct. |
Ø Register for the CFA program. Ø Pass the CFA exam. Ø Fulfill the work requirements. Ø Apply to be a member of the CFA Institute. Ø Submit 2-3 references from relevant persons. |
Ø Sit and ace the CPA exam. Ø Satisfy the educational requirements of your State Board. Ø Meet the work requirements your State Board of Accountancy stipulates. Ø Take the ethics exam (if required by your state). |
Skills Required for CMA CFA CPA
The skillset a professional possesses distinguishes them from others.
For instance, the main difference between CPA and CFA is their focus area, determined by their skill sets.
A CMA must possess the following skills: leadership skills, communication skills, interpersonal skills, decision-making skills, analytical skills, and management skills.
A CPA thrives based on the following: accounting skills, project management skills, communication skills, analytical & problem-solving skills, high ethical standards, and a broad business perspective.
The skills common to a CFA include research skills, detail-oriented, analytical skills, computing skills, decision-making skills, time management skills, and integrity.
CMA vs CFA vs CPA: Course Curriculum
By glancing through the course curriculums of these programs, you’ll know which is best for you.
The CFA syllabus entails corporate finance, economics, ethics & professional standards, fixed income & derivatives, alternative investments, portfolio management & wealth planning, financial reporting, and quantitative methods.
On the other hand, the CMA program includes the following topics: financial statements, corporate finance, technology & analytics, performance management, investment analysis, budgeting, planning & forecasting, external financial reporting decisions, and professional ethics.
Other topics include cost accounting, decision analysis, internal controls, and risk management.
The CPA curriculum focuses on individual federal taxation, corporate governance, economic concepts & analysis, financial statement accounts, entity federal taxation, professional ethics & general principles.
The course organizers carefully select these topics to reflect the different career paths participants want to take after completing them.
CMA vs CFA vs CPA: Examination Fees and Other Costs
None of these programs goes for free.
You pay a one-time enrollment fee of $450 while registering for CFA Level I.
CFA Levels I is $700 for early registration and $1,000 for standard registration.
Also, Levels II and III are $700 for early birds and $1,000 as standard registration for each level.
The total exam fees are between $2,450 and $2,950, based on when you register.
Conversely, the application fee for the CPA program is $130 and $300 as a one-time registration fee.
The examination fee is $833, while the professional ethics exam is $169.
Licensing fee is $175, and you pay $1,000 annually for continuing professional education credits.
$2,700 is the total licensing and exam fees for the CPA.
You may also buy the CPA review course for $2,000.
There are different packages for students and professionals in the CMA.
While professionals pay $250 as the entrance fee for CMA, students pay $188.
The registration fee for CMA Exam Part 1 is $415 for professionals and $311 for students.
Professionals pay $415 for Part 2, while students pay $311.
Thus, the total cost for professionals is $1,080, while students pay $810.
Program Duration of CMA vs CFA vs CPA
The Institute of Management Accountants expects candidates to complete the CMA program in 36 months, but many of them complete it in a year.
On the other hand, the CPA licensing program takes one and a half years to complete.
Candidates are to study for and take all four exams within this period.
However, the most daunting one is the CFA, as it takes 4 years to complete.
But most candidates spend 5-7 years to pass the CFA exams.
CPA CMA CFA Exam Structures
Knowing the exam structure gives you a mental picture of what to expect during the exam.
The three designations have different exam parts.
The CMA is divided into two parts:
Part I—Wealth planning, performance & analytics
Part II—Strategic financial management
Each part contains 100 multiple choice questions, which last for 3 hours each.
There are also two 30-minute essays containing 10-12 calculations or written questions.
The questions are set in ideal business contexts.
A candidate must have 75% accuracy to earn the CMA.
On the other hand, the CPA exam has four sections: business environment & concepts, auditing, regulation, financial reporting & accounting.
Each section contains an average of 77 multiple-choice questions and lasts for 4 hours.
Also, you must score 75% in all the exams to stand to earn the license.
If you’re still swinging from CMA or CFA due to pass level, they have the same rate; 75% is the pass mark for the two certifications.
However, the CFA exam is segmented into three sections.
The three exam sections summarize the course contents.
CFA Level I comprises 100 multiple-choice questions and lasts for 4 hours, 24 minutes.
Level II also contains vignette multiple-choice questions, while Level III is a mixture of essays and progressively complicated multiple-choice questions.
Levels II and III also last for 4 hours, and 24 minutes.
CMA vs CFA vs CPA: Exam Difficulty Levels
Many professionals have intentionally avoided CFA accounting due to its difficulty level.
The three certification exams are a bit complicated and taxing.
However, if you are diligent with studying the appropriate review courses, you’ll ace the exams once.
According to the CFA Institute, the 10-year pass rates for CFA Levels I-III exams are 42%, 45%, and 54%, respectively.
CMA has approximately 36.25% for Part 1 and 50.5% for Part 2.
The pass rate of the CPA is between 45%-55%.
If you’re planning to take any of these exams, these figures should spur you to study well!
You can’t be careless about any of them and pass.
After enrolling in a program, get the appropriate study materials and review courses to familiarize yourself with the course content.
Don’t just purchase a review course without reading the feedback about it.
You need a minimum of 300 hours to prepare for each CFA exam level.
In other words, you need 900 hours of commitment to studies to pass the CFA exams.
On the other hand, the American Institute of Certified Public Accountants recommends 80-100 hours of study for each level of the CPA exam.
Hence, you need 320-400 hours to prepare for the CPA adequately.
For the CMA, dedicate 150-170 hours to each of the two parts.
You should religiously follow these timelines and adopt a learning style that best works for you.
CFA vs CPA vs CMA Exam Dates
When preparing to enroll in a certification program, one of the first things to know is the exam date.
Knowing the date beforehand enhances your mental and psychological preparations.
The CPA is a continuous testing exercise; the exam takes place four times yearly.
The testing windows for 2020 are January to March, April to June, July to September, and October to December.
It’s an all-year-round, and you should schedule your exam within three months of enrolling in the program.
There are three testing windows for the CMA exam—January to February, May to June, and September to October.
Take note of the CFA exam dates because you’ll pay a fine if you try to reschedule your date.
CFA Level I exam dates for 2022 are Feb 15-21, May 17-23, Aug 23 to 29, and Nov 15-21.
Level II comes up on February 22-26, Aug 30 – Sept 03, and Nov 22-26.
However, Level III comes up twice annually—May 24-26 and Aug 30 to Sept 06.
Career Outlook for CMA vs CFA vs CPA
The time and resources you commit to earning any of these three designations are worth it, and rest assured of your return on investment.
For instance, management accountants witness a 63% increment in their earnings when they become certified.
We’ll discuss the job outlook of each of the three designations to know how bright your chances are.
Career Outlook for CFA
Charterholders work in organizations such as nonprofits, government offices, brokerages, colleges, and hedge funds.
CFA roles are highly lucrative and rewarding.
The Bureau of Labor Statistics (BLS) has projected a 6% job growth for CFAs from 2020 to 2030.
It means there would be 41,000 job openings for financial analysts annually, and certified persons will take the most significant chunk of them.
There are many opportunities for CFAs in commercial banking, investment banking, asset management, insurance, and private wealth management.
Chartered financial analysts are also valued in fintech.
You can be a data scientist, portfolio manager, internal auditor, consultant, researcher, CFO, financial planner, and credit analyst.
The CFA is the gold standard of certifications in finance; hence, the opportunity to be a hardworking certified fellow is
Job Outlook for CPA
Similarly, the BLS has projected a 7% job growth for accountants and auditors from 2020 to 2030.
There would be over 135,000 job openings for accountants yearly, and the senior-level positions are left for CPAs.
If you still doubt whether to go for CPA or CFA, the job outlook for the two designations will give you a clearer view of the path to take.
There are more opportunities for a CPA than CFA, but the latter provides more lucrative opportunities.
If you want to hold senior-level public accounting positions, you must be experienced.
Some organizations require at least three years of experience to hold a top-level position in their firm.
Also, the 2002 Sarbanes-Oxley Act has opened more job opportunities for certified public accountants.
If you want to enjoy the opportunities in CPA and CFA, you may consider the CPA CFA combo; earn the two designations to set yourself apart.
CMA Job Outlook
CMA has the same job growth rate as the CPA and ACCA—a 7% growth rate annually.
Many employers prefer the CMA credential because its holders are skilled in strategic management.
Almost every business needs a management accountant to maximize profit and ensure business success.
With your cost accounting, data analytics, and strategic thinking skills, you’re a cynosure of all eyes in the industry.
Benefits of the Accounting Certifications
With the projected job growth rates for the three certifications, we need not repeat much on their benefits.
If you’re disciplined enough to be certified, you’ll live above job scarcity and be an essential stakeholder in the industry.
Most clients and employers are skeptical about working with uncertified persons because they’re unsure of your ability to deliver an excellent job.
Any of these three certifications takes doubt off your head.
Below are a few benefits why you should pursue each of these designations:
Why You Should Get the CPA
Earning a CPA certification makes you more trustworthy and moves you into the group of accounting professionals needed for their expertise and dedication to work.
The CPA bolsters your job prospects and allows you to perform exclusive roles.
For instance, you must be a CPA before filing a report with the Securities and Exchange Commission (SEC).
The license depicts your professionalism in auditing, public accounting, forensic accounting, and financial advisory roles.
However, a CPA who wants to audit should earn the certified internal auditor (CIA) certification.
The CIA credential is the hallmark for professionals in internal auditing.
The CPA designation also signals your interest in management and leadership positions.
Many employers sponsor their employees for the CPA program because they know its importance to their organizational growth.
Why You Should Earn the CFA
The CFA appellation distinguishes your resume from other applicants.
Recruiters know how daunting and demanding it is to earn the CFA certification.
Thus, they believe you have the analytical skills, dedication, ethical reasoning, and ability to do a wide array of tasks.
If you want to occupy high positions in the industry, earning this certification is indispensable.
However, you’ll even further stand out if you earn the financial risk manager (FRM) designation.
The FRM shows you know everything about risk in various contexts.
If you also want to become an accountant CFA, you may give the CPA CFA combination a thought.
Why You Earn the CMA
CMA holders are precious to private entities due to their versatility in accounting and finance.
The CMA program sharpens your understanding of strategic planning and management.
CMAs also report 63% higher compensation than their uncertified colleagues.
As advised while discussing CPA, CMAs may also earn the CIA certification to have headway in internal auditing.
Conclusion
This piece discussed the importance, similarities, and differences between the CMA, CPA, and CFA.
A university degree is the minimum educational qualification for the three programs, but the CMA also allows equivalent certifications.
We explained the CMA degree meaning to shed more light on this exemption.
The three accounting certifications have their impact and area of specialization.
You may consider earning multiple certifications as you advance in your career.
It’s one of the secrets of getting to the top quickly.
But before you put in for any certification program, ensure it aligns with your career path.
If it doesn’t add to your career advancement, then you don’t need it!
