CMA vs CPA – that is the magic question for many candidates seeking their certification in accounting. You are making an important decision, so it makes sense that you put the time and energy into deciding what is best. If you’re trying to decide between these two certifications, I hope to provide you with enough information to make a proper choice for yourself.
Should I go for CPA or CMA? Can (or should) I get both? Let’s explore.
The first step is to understand what each of these certifications are. Certified Public Accountant is the “black-belt” for public accounting, and in essence, for the accounting profession in general. If you’ve been considering accounting on any level, you’re likely already familiar with the CPA.
The exam itself covers a broad range of knowledge, ranging from the core financial accounting and auditing, as well as taxation, business laws, and ethics, cost accounting and strategic planning, economics, statistics and difference between the US and international accounting systems.
When compared to CPA, the Certified Management Accountant certification highlights the professional’s accounting and financial expertise within the corporate world. That is, the skills required for finance managers, controllers and CFOs. It also touches upon the operational and strategic aspects of running a corporation, a non-profit or a governmental agency.
What’s the difference between public accounting and management accounting? Steve Colton from Accounting Insights summarizes it well:
Financial accounting is concerned with providing information about a company’s operations to parties external to the company. Examples include the IRS, bankers, suppliers, creditors and shareholders. A primary focus is on standardized reporting and achieving compliance with applicable regulations.
Management accounting is concerned with providing financial information about a company’s operations to its internal managers. The focus is on developing relevant and timely information that helps internal managers resolve the problems. It also helps make decisions that arise on a day-to-day basis.”
In terms of the process of getting the CPA vs CMA qualification, here are the factors you should consider.
|Need bachelor degree?|
|150 credit hours needed?|
|Min. accounting courses?|
|# exam days per year||4 testing windows(9 months)||4 testing windows
|Total exam hours||14||8|
|No. of parts/levels||4||2|
|Latest pass rates||48-51%||35% / 50%|
Let’s take a look at the price point of the investment in each of these. As you can see in the chart above, the CPA can cost between $2,000- $3,000 and this is just for the exam-related expenses. You will pay more if you factor in study guides, travel, and other related expenses.
For the CMA, you’re looking at around $1,000- $2,000. As you can see, it can be less for the CMA, or it could be right around the same cost for both of the exams, depending on different factors you can use to help you save more on the exams.
You shouldn’t make your decision about which accounting certification to take on price alone. First, they are very close in cost, and secondly, there are other factors to consider. I am going to review these with you below. Whichever certification you decide to go for, you can get discount codes to help you save a little more.
The following chart shows the overlap of topics between the CMA and CPA exams. The weighting in overlapped areas can be quite different so please use this for general reference only.
|CMA Part 1 Topics||Where It Appears in CPA Exam|
|External Financial Reporting (15%)||FAR / REG (Tax Implications)|
|Planning, Budgeting and Forecasting (30%)||BEC|
|Performance Management (20%)||BEC|
|Cost Management (20%)||BEC|
|Internal Controls (15%)||AUD|
|CMA Part 2 Topics||Where It Appears in CPA Exam|
|Financial Statement Analysis (25%)||FAR / AUD (Analytical Review)|
|Corporate Finance (20%)||BEC|
|Decision Analysis (20%)||BEC|
|Risk Management (10%)||BEC / AUD (possibly Audit Risk)|
|Investment Decisions (15%)||BEC|
|Professional Ethics (10%)||AUD|
Source: SF Magazine, August 2015
Now, if you’re looking to compare the two accounting certifications based on difficulty, which is harder? While this question is always subjective, most people will agree that the CPA is a bit harder. However, CMA can be more useful to accounting professionals. Is it really worth it to go for the harder CPA for reasons other than bragging rights?
How much harder is the CPA than the CMA? Well, again, this is all based on opinions. Overall, how much more difficult the CPA exam feels depends on the types of study materials you are using, your experience, and your education levels.
It also depends on what specific field of work you are planning to go into. People who take the CMA will find a greater focus on management accounting. If this is the field you work in already, this is going to be an easier exam for you. If that is the field you plan to go into, then that might be the better choice between the two exams. We’ll get more into why one could be better than the other below.
When comparing these two certifications, and when considering which is harder, it also helps to look at pass rates.
Looking at past statistics, we can see that the ICMA used to release CMA passing percentages for each exam part about every 9 months. But the exact time period for the latest CMA pass percentages (40% for Part 1 and 50% for Part 2) is unclear. You can still get a pretty good idea of the average pass rates from this data, however.
|Exam Part||2013||2014||2015||2015-2016*||2016-2017||2017-2018 (?)|
*In 2016, the ICMA adjusted when it releases the CMA exam pass rate data.
Policies have changed, and now the AICPA’s pass rates web page only features the current year’s pass rates. Still, the average is around 50% for the CPA, even when we look at past years’ stats. For this year so far, we can see they are even a bit higher than that.
|Section||First Quarter||Second Quarter||Third Quarter||Fourth Quarter||Cumulative|
When looking at these pass rates, there are a few things to keep in mind, however. Alone, they are not an indication of which exam is harder. The pass rates for the CPA could be higher because of the lengthy process of getting to the CPA exam. The CMA exam pass rates could be a bit lower because people go into it thinking it’s “easier” and do not properly prepare for it.
Next, let’s look at some reasons why the CPA might be better.
The CPA qualification dated back to the early 20th century and is without a doubt the most established qualification among the accountant industry. Because of this and other reasons, the CPA title is more recognized in the US and in other parts of the world.
The AICPA and NASBA have been pushing for a uniform CPA prerequisite in all states — the so-called “3E” requirements ask for 150 credit hours with a concentration in accounting, together with 1-2 years of experience verified by an active CPA licensee. The entry barrier is so high that becoming a CPA is a prestige that few people can get, which in turn makes the qualification very valuable.
CPA is widely recognized and you get the perks no matter where you work in the finance and accounting field, be it public or non-public accounting. On the other hand, CMA is only useful for those to work and stay in the corporate world.
Finally, let’s look at some reasons why the CMA might be better for you.
In reality, most accountants (whether starting as a public accountant or not) will end up in the corporate sector. This means that the management accountant skill is more practical in medium to long term for professionals in the accounting industry. In fact, many candidates who went through both CPA and CMA find the materials covered in CMA more interesting and useful in their daily business life while CPA materials are too theoretical.
Both exams cost a fortune, but the CMA certification is considerably less. Also, with only 2 parts (vs 4 parts in CPA) it takes less time to study and pass.
If you want to get a fast track, CMA allows you to take the exam before you graduate, although you will have to complete your bachelor degree with 2 years of experience to ultimately get the certification.
The CPA license is granted by each of the states instead of by a national body. This legacy issue has created a lot of confusion and challenges in the qualifying and application process.
CMA is administrated by one organization, the Institute of Management Accountants. IMA is well-run with fast email responses and provides clear instructions on how to prepare, study and pass the CMA exam.
After you get the CMA certification and if you choose to stay active, IMA provides everything from the free webinar (for CPE and self-learning) to a forum for members to exchange ideas and build networks. CPA, in comparison, has Society of CPAs in each state but the support is less impressive.
Here’s another idea for you: What if you get both?
Why not get both? Indeed, there are many people who get both. Sometimes they get them back-to-back, or they might wait years in between. There are different reasons why someone might get both credentials. Let’s take a look at some of them.
Here are the reasons:
While the two exams test for different skills, their core curriculum is accounting. You can expect, roughly speaking, 30-40% overlap of the two. If you have taken the CPA exam, the CMA exam Part 1 can be considered a harder and more comprehensive version of BEC (Part 2 is somewhat similar to Level 1 of CFA).
Both CPA and CMA require certain hours of continuing professional education. Many CPE courses are good for both. This is a great reason to consider going for them both.
I think most people would agree that the CPA is more prestigious but CMA is more practical. If that’s the case, if you have a dual qualification, you have the best of two worlds. This could help you get better jobs, or get a raise in your current job.
Since going for two designations will cost more than going for just one, you’ll want to ensure that you save costs wherever possible. That’s why you can find considerable CPA review discounts and CMA review discounts on my sites.
This video highlights the merits and limitations of CMA and CPA qualifications.
Check out these links below to see what some of my bloggers have to say about the CMA when comparing the CPA vs CMA.
|Gavin: how he convinced
his parents that CMA is more suitable
|Casey: why CMA is
better even for CFOs
If you have comments on CMA vs CPA, I’d love to hear your thoughts in the comment box below.
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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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