Saher is a 21-year-old Indian residing in Dubai. She took Part 1 and 2 back-to-back after passing her CFA level 1 in June.
25% of the hardship is complete if you just understand the CMA syllabus. The perspective of the CMA syllabus is different if you have an accounting and finance background (in terms of both education and career).
I thought it would be helpful if I broke it down for those planning to take the CMA exam.
While CMA stands for Certified “Management” Accountant, the exam is divided into two parts and involves more than just management accounting:
Although CMA Part 1 is considered to be the tougher of the two, it is not as hard as it is portrayed to be. YES INDEED! But still, the portion is much harder to absorb.
If you don’t have the relevant background, this part can be quite a challenge.
The section includes the basics of accounting like financial statements, understanding the elements of financial statements, revenue recognition, etc.
Basic budgeting concepts, types of budgets, hierarchy, timelines, etc. Aim to score at least an 80% on this section.
Types of variances, calculating variances, balanced score card.
Types of costs, costing methodologies, cost efficiencies, overheads, cost allocations, and business improvements.
Introduction to internal controls, types of controls, testing controls, IT controls, etc.
A new section about the use of technology as a CMA.
Part 2, on the other hand, is much easier to understand. If you have a background in accounting or finance (and especially finance), you can easily ace this exam.
If you have no background in accounting/finance, the concepts are still easier to understand, but there is a lot of math involved.
Understanding financial statements, ratio analysis, and profitability analysis.
Dealing with risk management of portfolios, basic corporate finance concepts like time value of money, intrinsic value, raising capital, risk and return relationships, corporate structures, etc.
If you studied finance in college, you’ll find it easier to study and solve the questions.
Cost/profit/volume analysis, pricing, and margin setting methods. Focuses on operational efficiencies.
There is only one chapter, focusing on types of risks and mitigating and preventing risks.
The classic Net Present Value and Internal Rate of Return in investment decision making.
Standards and principles of conduct, inducing ethical behavior in organizations. Apart from memorizing the standards and the principles, this is basic knowledge.
I hope this gives you more clarity and happy studying! 🙂
(Note: All of the above are simply opinions of the topics based on my experience. It may vary from person to person.)
Thanks for the analysis on the CMA syllabus and especially your thoughts on their relative difficulty. I’d like to expand on internal control, a section you find the most complex in Part 1.
Internal control is heavily tested in the US CPA exam. This is a tricky area in that it could be very conceptual and subjective, as in there is no clear, black-and-white answer. You’ll have to pick the “best” answer out of the possible, seemingly correct ones. this makes the questions very difficult.
There are lots of stats available in the CPA exam, and I notice that Indian candidates are noticeably weaker in internal control. I have no idea why, but it could be that Indian companies use a different approach. If you are an Indian candidate, it’s worth spending more time tackling this section.
Hey there, I am working in Dubai as Junior Associate in a management consultancy firm. I am a CFA level 2 candidate, and during the wait, I took and passed Part 1 and 2. I am now accumulating my experience to become a CMA.