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The Certified Management Accountant (CMA) exam has two parts, each focusing on a different set of topics. Together, the two parts serve as an objective measure of your knowledge and competence in the field of management accounting. You must dedicate your studies to getting very familiar with each part, so let’s start by introducing you to CMA Exam Part 1.
|Content Area||Coverage Percentage||Coverage Level|
|A. External Financial Reporting and Decisions||15%||Level C|
|B. Planning, Budgeting, and Forecasting||30%||Level C|
|C. Performance Management||20%||Level C|
|D. Cost Management||20%||Level C|
|E. Internal Controls||15%||Level C|
As you can see in this table, Part 1 of the CMA exam is called Financial Reporting, Planning, Performance, and Control, and it addresses five content areas.
The Institute of Certified Management Accountants (ICMA) creates the CMA exam and shares the body of knowledge each exam part will cover in the content specification outlines (CSOs). The ICMA uses the CSOs to
The CSOs put a coverage percentage next to each exam part topic in order to represent its relative weight. Additionally, the CSOs assign a coverage level to each exam topic. The coverage levels range from an introductory knowledge of the subject matter to a thorough understanding. The ICMA defines the three levels of coverage as:
The coverage levels build on each other, so Level C may contain the requirements of Level A and Level B.
The CSOs don’t tell you the order or the frequency of the topics on the exam.
Part 1 is all about financial reporting, planning, performance, and internal control. If you took the CPA Exam, then Part 1 will feel like an intro to FAR, a bit of AUD in terms of internal control, and a big, more in-depth version of BEC.
In the CMA Handbook, the Institute of Management Accountants (IMA), the worldwide association of accountants and financial professionals in business that offers the CMA certification, summarizes the topics of each CMA Part 1 content area.
In this section, you’ll be required to know the items in these documents and how they relate to each other:
If you have studied any accounting before, this should be a relatively straightforward section, and most of these questions should be computational.
Budgeting is the biggest section of Part 1. You’ll be expected to calculate various items such as the cost of goods sold, cost of goods manufactured, and other items in the budget. You’ll also see some conceptual questions such as the definition of budgeting. The coverage of section B is more in-depth than that of section A. The concepts are not difficult, but questions can get lengthy and complex in some budgeting scenarios.
In this section, candidates are tested on the ways performance is evaluated in a corporation. Most of the evaluation tools should be familiar to those who work in the accounting department of a corporation. There are certain elements, such as standard costs, that are used mostly in manufacturing companies as opposed to service-oriented companies. If you are working in a financial institution or other service companies, you may want to spend more time in understanding the standard cost concept.
The focus of this section includes the various costing methodologies, and you are expected to be able to complete a full set of calculations.
The internal control questions in this section are almost all conceptual. They are not difficult to understand, but they can be ambiguous. Picking the best answer can be pretty hard when a few of the answers seem to be somewhat correct. Don’t’ get frustrated if you breeze through this section but discover that you do poorly on the practice questions. It happened to me back then, but things started to click after I stayed focused and reworked the tough questions that I got wrong.
Each part of the CMA exam features two types of questions and a specific number of each:
You’ll have four hours of total testing time for each exam part, divided like this:
You must answer at least 50% of the MCQs correctly to be eligible to move on to the essay section. If you are eligible, the exam will present the essays to you after you’ve answered all of the MCQs or after 3 hours have passed, whichever comes first. Once you leave the MCQ section of the exam, you can’t go back: you must remain in the essay section.
In the essay section, you must complete 8-10 written response or calculation questions based on two scenarios describing a typical business situation.
On the CMA exam, the MCQs have three parts:
Aside from the typical, straightforward MCQ question, there are a few other types of MCQs that you’ll see on each exam part.
Part 1 of the CMA exam contains two essay scenarios to which you must respond by answering about 3-5 questions. The essays may ask you to write a few paragraphs or perform a calculation.
The essays are graded by subject matter experts, and they will award partial credit. So, when answering a conceptual essay question, you should write as much as you can about the topic so you can maximize your points. Do the same for computational questions by showing your work, as you can receive points for using the correct formula even if you made a mathematical error, for example.
If you must make a chart or table, keep the formatting simple and focus on organizing the information clearly.
The historical pass rate of CMA Exam Part 1 is around 35%.
*The ICMA has adjusted when it releases data. These rates span January through October of their respective years.
CMA exam Part 2 tends to have higher pass rates than Part 1, so Part 1 has a reputation for being more difficult. But with neither part putting up pass rates much higher than 50%, it’s clear that basically, the entire CMA exam is quite challenging.
A passing score for either exam part is 360. The CMA exam scores are scaled scores that range from 0 to 500. The ICMA transforms your raw score (the number of questions you got right) to a scaled score so that the scores can be reported with uniformity and consistency, no matter which test form you take.
You won’t receive your CMA Part 1 exam results of pass or fail immediately because the essays questions are graded offline, and this is a long and laborious process. All of the CMA exams taken within a testing window are graded at the same time so that the grading is consistent, accurate, and fair, and the ICMA performs sample grading first to ensure that every solution has been accounted for. Throughout the grading process, reviewers check the grades, and after the grading is complete, the reviewers conduct an additional review of exams that are on the border of passing.
To calculate your final score, the ICMA adds the score of the MCQ section to the score of the essay section. Your score for the entire part will be a scaled score reflecting the total weighted score of pass/fail. Your total score determines your pass/fail status: you don’t have to pass both sections.
Exam results are released about 6 weeks from the end of the month in which you tested, and your results will be emailed to you and posted to your online profile. If you failed an exam part, you will receive a Performance Report in an email from Prometric about 14 days after your results are posted to your candidate profile. In your Performance report, you’ll see whether your performance was satisfactory, marginal, or unsatisfactory for each of the key topic areas in the MCQ section. You’ll also see your overall performance on the essays.
Both Part 1 and Part 2 of the CMA exam are offered at Prometric testing centers around the world during these three testing windows:
Different voices in the CMA exam industry have suggested different amounts of study time for Part 1.
|Part 1||150-170||120||90||150||80 minimum / 170 maximum|
My maximum recommendation also includes answering all of the practice quizzes in the test bank and reviewing the answer explanations for your incorrect answers.
The amount of time you need to study for the CMA exam depends on how familiar you are with the material when you start your review. However, no matter how much you know when you start, you must plan to put in the necessary amount of review time to reach the cognitive levels at which the exam tests.
If you already feel comfortable with some of the Part 1 topics, you might be able to base your study schedule off the minimum amount of time I recommend. If most of the CMA exam material seems foreign to you, you may want to assume that you will need the maximum amount of study time I suggest. Here’s how many weeks and hours per week you would need to study to reach these study time marks:
|Total Hours||Number of Weeks||Hours Per Week||Hours Per Day|
|Minimum||80||8||10||~ 1 ½|
Take these steps to make your CMA Part 1 study plan:
You can gain access to free CMA Part 1 practice questions in a number of places.
You can also access my FREE CMA mini-course to start your CMA exam preparations.
For those of you who are deciding between different qualifications or want to leverage the knowledge you gained from a professional exam you just took, here is the good news.
There is quite a bit of content overlap among the CMA exam and the following accounting and finance exams:
The biggest section in CFA Level 1, the Financial Reporting and Analysis (FRA), is essentially the same as Section A of the CMA Part 1 exam. While the knowledge base is the same, the focus is slightly different: CFA approaches the material from a more analytical perspective, while CMA comes at it from more of a reporting perspective.
Section A of the CMA Part 1 exam is the lite version of FAR in CPA Exam. In other words, if you passed FAR, you shouldn’t have any issues with this part of the exam.
A big part of Section E on Internal Control overlaps with the AUD section of the CPA Exam. Section E primarily covers the role of internal control within the company, while AUD concentrates more on the external auditor’s perspective.
Some elements of Section B, C, and D are covered in the BEC section of the CPA Exam. In this case, the CMA exam is more in-depth, but you will encounter similar questions on strategic planning and cost accounting in BEC.
The Internal Control section shares the same fundamental concepts of the internal audit exam. The CIA exam goes a lot deeper in its own niche, but these two exams share a lot of content and even the style of questions (more conceptual and not very clear cut).
There aren’t many things to memorize for CMA Exam Part 1, but you do need to have a clear grasp of the concepts and be able to distinguish the subtle differences between them.
As you answer CMA practice questions, you’ll see that some of them are very lengthy, but don’t get frustrated: just take the time to complete the calculations. If you are running out of time, mark the long questions and work on the short ones first. I suggest you read the questions slowly and get familiar with how the questions are presented. Once you’re used to the format and the type of calculations you must perform, your rate of accuracy with the questions will go up dramatically.
If you work on the practice questions, understand the underlying concepts, and rework the questions you got wrong, your chance of success will be very high. Best of luck on your exam!
I created this video that goes through the syllabus and exam content in more detail.
I am the author of How to Pass The CPA Exam (published by Wiley) and the publisher of this and several accounting professional exam prep sites.
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