CFA vs CMA

CFA vs CMA Differences

The primary difference between CFA and CMA is the skills obtained. CFA is conducted by CFA Institute (USA) and focusses on enhancing Investment Management skills, including Investment Analysis, Portfolio Strategy, Asset Allocation, and Corporate Finance. Whereas, CMA is conducted by Institute of Management Accountants enables you to develop a level of expertise in both financial and management accounting and strategic management.

We will look at both the credentials and guide you on which one is better for the features each one of them has to offer.

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We will discuss the following in this article –

• CFA® vs CMA Infographics
• What is Chartered Financial Analyst (CFA®)?
• What is a Certified Management Accountant (CMA)?
• Why pursue CFA®?
• Why pursue CMA?

CFA® vs CMA Infographics

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CFA vs CMA – Comparative Table

Section	CFA	CMA
Organizing Body	The CFA Institute, USA organize the exams.	The exams are conducted by the Institute of Management Accountants (IMA), USA.
Pattern	The course is divided into 3 levels, namely Level I, Level II and Level III.	The course is divided into 2 parts. Part I – Financial Planning, Performance and Analytics Part II – Strategic Financial Management
Duration of Course	A candidate can complete the course in 4 years if he/ she can clear all the exams in the first attempt.	A candidate needs to complete both parts within 36 months. However, the average time taken is 12-18 months.
Syllabus	The core curriculum includes Ethical & Professional Standards Quantitative Methods Economics Financial Reporting & Analysis Corporate Finance Equity Investments Fixed IncomeFixed IncomeFixed Income refers to those investments that pay fixed interests and dividends to the investors until maturity. Government and corporate bonds are examples of fixed income investments.read more DerivativesDerivativesDerivatives in finance are financial instruments that derive their value from the value of the underlying asset. The underlying asset can be bonds, stocks, currency, commodities, etc. The four types of derivatives are - Option contracts, Future derivatives contracts, Swaps, Forward derivative contracts. read more Alternatives Investments Portfolio Management & Wealth Planning	The course covers the following topics. External Financial Reporting Decisions Planning, Budgeting & Forecasting Performance Management Cost Management Internal Controls Technology & Analytics Financial Statement Analysis Corporate Finance Decision Analysis Risk Management Investment Decisions Professional Ethics
Exam fees	Each level’s cost falls in the range of $700 to $1,000, depending on the time of registration, plus a one-time registration fee of $450. Hence, the overall cost lies in the range of $2,550 to $3,450.	The cost for professional members is $1,080, including a $250 entrance fee and $415 per part. The cost is $810, which includes a $188 entrance fee and $311 per part.
Jobs	Some of the common profiles include Portfolio ManagerPortfolio ManagerA Portfolio Manager is an executive responsible for making investment decisions & handle investment portfolios for fulfilling the client’s investment-related objectives. Also, he/she works towards maximizing the benefits & minimizing the potential risks for clients. read more Investment AnalystInvestment AnalystAn investment analyst is an individual or firm that excels in the financial and investment research and have a keen knowledge of financial instruments and models. Such financial professionals include portfolio managers, investment advisors, brokerage firms, mutual fund companies, investment banks, etc.read more Consultant Wealth Manager Strategist	Some of the common profiles include Cost Accountant Consultant Financial Risk Manager
Difficulty	Challenging as only ~10% of the candidates clear all the levels.  During June 2019, the pass rates for Level I, Level II and Level III were 41%, 44% and 56%.	Moderately difficult with a historical pass rate of 50%. During January-February 2020, 45% of the candidates cleared both Part I and Part II.
Exam date	Upcoming exam schedule for 2021 Level I: Feb 16 – Mar 01, May 18-24, Aug 24-30, Nov 16-22 Level II: May 25 – Jun 01, Aug 31 – Sep 04 Level III: May 25 – Jun 01, Nov 23-25	Upcoming exam schedule for 2021 (both Part I and Part II) Jan 01 – Feb 28 May 01 – Jun 30 Sep 01 – Oct 31

What is the Chartered Financial Analyst® (CFA®) charter?

 The CFA® Program focuses on investment management. The top employers of shareholders include the most respected financial corporations globally, e.g., JPMorgan, Citigroup, Bank of America, Credit Suisse, Deutsche Bank, HSBC, UBS, and Wells Fargo, to name a few. Many of these are investment banks, but the CFA® Program focuses on the knowledge and skills most relevant to the global investment management profession from a practitioner’s standpoint.

Investment professionals who hold the CFA®designation (or CFA® charter) meet rigorous educational, work experience, and ethical conduct requirements.

Only those who complete three graduate-level examinations, four years of work experience, and annual membership renewal (including ethics and code of professional conduct attestation) are permitted to use the CFA® designation. Complementary codes and standards (such as the Global Investment Performance Standards and Asset Manager Code) help enhance this professional distinction.

What is a Certified Management Accountant (CMA)?

• The CMA credential will make you a certified management accountant and enable you to develop expertise in financial accounting and strategic management.
• CMA program was introduced in the year 1972 and has its value-add by specializing in cost accountingCost AccountingCost accounting is a defined stream of managerial accounting used for ascertaining the overall cost of production. It measures, records and analyzes both fixed and variable costs for this purpose.read more, financial analysis, and strategic planning.
• CMA is ideal for both accounting and finance majors who wish to work in the corporate world.
• This designation applies to those who are into cost and inventory accounting.

Why should you go for CFA® designation?

Top ten companies hiring CFA® include JP Morgan Chase, PwC, HSBC, Bank of America Merrill Lynch, UBS, Ernst & Young, RBC, Citigroup, Morgan Stanley, and Wells Fargo.

As of 31^st August 2019, CFA® Institute has over 178,000 members in more than 165 countries and territories, and around 95% of members are CFA® charter holders.

• CFA® is required, particularly if you wish to get into equity researchEquity ResearchEquity Research refers to the study of a business, i.e., analyzing a company's financials, performing Ratio Analysis, Financial forecasting in Excel (Financial Modeling), & exploring scenarios to make insightful BUY/HOLD/SELL stock investment recommendations. Moreover, the Equity Research Analysts discuss their findings & details in the Equity Research Reports. read more, investment banking, or portfolio management roles.

The differentiating benefits of earning the CFA® designation include:

• Real-world expertise
• Career recognition
• Ethical grounding
• Global community
• Employer demand

As of 30^th June 2019, IMA has over 75,000 CMA members and around 40,000 active CMAs. Globally, CMAs earn 63% more in total compensation than their non-CMA peers.

For more information, refer to- CFA® Programs.

Why should you go for CMA?

CMA has over 70,000 IMA members and around 20-30K active CMAs.

Globally, CMAs earn 59% more in median salary and 63% more in median total compensation than their non-CMA peers.

The global median salary is $60,000, and the global median total compensation is $66,000

• This credential is designed to help you improve your ability to make strategic business decisions depending upon the company’s financial situation.
• The eligibility criteria are flexible, and hence the entry barrier is low.
• The CMA exam is designed to be completed within a year as it has testing windows spread across 6 months in a year.
• The scope is narrowed down to learn about management accounting, specifically.
• Accounting is considered a necessity, and hence the demand for professional accountants is usually on the higher side.

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• CFP vs CMA

Bottom line

Weighing both these credentials, CFA® has more extensive market penetration and is more famous and comparatively tricky. Consider deciding to look at the remarkable careers each of these credentials has to offer and which you would enjoy more. Whichever certificate you go for will be an excellent investment. You would have to sacrifice the two most important things one is the most crucial and the cost associated with the certification. Think about the pros and cons and choose wisely!

All the best! :-)