There is no denying that both of these certifications have significant value to employers, but after years of schooling and thousands of dollars spent getting your accounting degree, you want to make sure you make the right decision so you can land your dream job.
Fortunately, there are many paths to success in the accounting industry. The Certified Public Accountant (CPA) and the Certified Management Accountant (CMA) are two certifications that elevate accountants above their peers.
Despite its focus on U.S. accounting principles and tax law, the CPA has long been deemed the gold standard for all accountants, regardless of their field or career goals. Many accountants pursue the CPA to open doors in their career. Though geared toward work in the public sector, CPAs can work for any sized firm, government body, or private company.
The CMA is a global certification that showcases accounting professionals ready to take on leadership roles. CMAs are needed across all industries and organizations but mostly work in the private sector. The CMA blends accounting acumen with business concerns.
Both are widely regarded and come with increased compensation, but they’re not one-size-fits-all. We’ll explain why and help you choose which one is right for your career.
Prospective CMAs must demonstrate they have a firm grasp on both management accounting and financial management concepts, such as business economics, the time value of money, and statistics and probability.
Each part of the CMA exam is 4 hours long and consists of 100 multiple-choice questions and two essay scenarios.
The CPA Exam is twice as long. Exam candidates must pass 4 exam sections whose topics range from Auditing and Attestation (AUD), Financial Accounting and Reporting (FAR), Regulation (REG), and Business Environment and Communication (BEC). Each exam section is 4 hours long and consists of Multiple-Choice Questions and Task-Based Simulations. BEC additionally has Written Communications, which are like essays.
CPAs are expected to exhibit deep technical knowledge of topics like information systems, controls, risk, SOC engagements, and even more under the proposed new CPA Evolution model. The model is scheduled to be implemented no earlier than January 2024. With this new model, CPA candidates will choose a “specialization.” But even after these changes take place, prospective CPAs will still be expected to display technical knowledge and higher order skills beyond their specific area of interest.
Accountants looking to specialize and make business decisions might want to consider the CMA. Those looking to showcase their breadth of knowledge might prefer the CPA.
Both the CMA and CPA exams require candidates to display different levels of knowledge on their tested topics, even when there’s some overlap in content. While they categorize these levels differently, they are comparable. Categories range from simply testing a candidate’s ability to remember a topic to more advanced tasks, such as analyzing a scenario and explaining how to handle it.
The CMA exam recently changed, but 2015-2019 pass rates put CMA Part 1 at about 36% and CMA Part 2 at 50.5%. Quarter 1 of 2020 saw both sections at about a 45% pass rate.
The CPA Exam pass rate is a little higher overall, but not by much. In Quarter 1 of 2020, the CPA FAR section had a reported pass rate of 46%, with AUD not far ahead at 48%. The BEC and REG sections had pass rates of 55% and 62%, respectively.
Neither exam is easy, and both require many hours of study to pass. But, on average, candidates spend less than half the time studying for the CMA compared to the CPA.
Do not decide which certification to pursue based on the time it takes to prepare. Getting a “quick” certification may not be the best move for your career and may end up being an inefficient use of your time and money. Underestimating either exam can also lead to increased study time overall if you end up failing one and have to restudy for it.
All candidates should consider using a review course to save time and money during their exam preparation.
For both certifications, passing the exam is not the only requirement. Each also requires candidates to have a few years of experience and attain a certain level of education.
The requirements for CPA licensure differ slightly among the 55 state boards of accountancy. For most jurisdictions, candidates need to complete 150 credit hours and certain accounting courses. Depending on the state, candidates may be eligible to sit for the exam with as few as 120 credit hours.
Additionally, in order to earn the license, CPA candidates must show they have experience working in the field. This requirement ensures that newly licensed CPAs don’t just have textbook knowledge, but can apply their skills in the real world.
By comparison, the CMA certificate requires only a bachelor’s degree, which doesn’t need to be completed before enrolling in the CMA program or to sit for the CMA exam. You simply need to earn your degree within 7 years of enrolling in the program to be certified.
Similar to CPA, the CMA requires candidates to have up to 2 years of experience before they can earn the certificate. However, the type of experience is different. While CPA jurisdictions typically require some form of public accounting, CMA requires the experience to be in a position that routinely involves management accounting principles.
For quick reference, check the chart below:
|150* credit hours of education. A Master’s degree isn’t required but is a common way to meet the hour requirement.||Bachelor’s degree|
|Education needs to be completed before sitting in most jurisdictions.||Education requirement can be completed up to 7 years after entering the CMA Certification Program.|
|1-2 years of experience in government, non-profit, or other public accounting.|
(Varies by jurisdiction)
|2 years of experience in a position routinely making judgments using the principles of management accounting and financial management.|
*NOTE: Some jurisdictions allow a person to sit for as few as 120 semester hours. 150 hours are still required to earn a CPA license.
Accountants who are looking for a certification but don’t want additional schooling might consider a CMA if they have the appropriate experience. But if you do not have experience in a position IMA requires of CMA candidates and you do not plan to work in such a position anytime soon, you may prefer to earn your CPA.
Once either certification is earned, a newly licensed CPA or CMA must maintain their expertise. Each certification requires candidates to complete Continuing Professional Education (CPE) hours to show they still have the knowledge of newly-licensed candidates.
The CMA exam requires 30 hours of CPE every year, with at least 2 of those hours in ethics. For the CPA, it’s best to check with your state board of accountancy, as requirements can vary between jurisdictions. For example, California and Florida both require 80 hours over a 2-year period (or 40 hours each year), but both have different requirements for those 80 hours. Meanwhile, Texas requires 120 hours over a 3 year period (still 40 hours each year). New York has two different options, requiring either 24 or 40 hours each year. The good news is that many continuing education courses provide CPE credit for both certificates; therefore, taking a single course may provide CPE credit for both.
Gleim has many online courses available for both certifications, so you can complete these hours whenever is most convenient for you!
Neither exam is cheap; both often cost thousands of dollars to study for and take. Budgeting is important when deciding which certification to pursue. Fortunately, there are a few cost-saving options that can help you.
The CMA costs between $888-$1,350 before purchasing a review system. A complete review system can add up to another $1,600. CMA candidates can save money on exam fees by taking the exam as a student, and these savings can extend to their study materials.
CPA Exam costs vary among the state boards, but on average, taking the exam will cost candidates $1,300. Study materials are often an additional $2,000.
|Registration||$75 / section||$15|
|Examination Fees (per part)||$208||$415|
*NOTE: Each State Board of Accountancy charges different fees and may have a different process. For the exact amount, check with your state board.
The CPA Exam has a higher initial cost, but active CMAs must belong to Institute of Management Accountants (IMA). The cost of an annual membership will eventually exceed the CPA’s cost over the course of a long career. However, IMA membership comes with many benefits, including free CPE, which can counteract the cost of membership.
Candidates looking to save money in the short run may value the CMA over the CPA, but those looking to avoid annual membership fees should choose the CPA. Unfortunately, both exams are fairly expensive, and having to retake any exams will only increase the cost.
Both exams are a high-priced investment, but the dividends are more than worth it. Specifically looking at salaries, both certifications increase your earning potential significantly.
IMA puts out a yearly salary survey that shows total increased compensation (salary with benefits) compared to non-certified peers.
|50 and older||22%||25%||37%|
Holders of either certification (or both) state they have increased job security and more opportunities than they would have had without their certification. Firms, companies, and industries across the globe recognize the value of these certifications and actively seek out prospective employees who have earned them or are in the process of earning them.
If you still can’t decide between the two certifications, the great news is you don’t have to! These certifications are not exclusive and many accountants looking to push themselves get both certifications behind their name.
Accountants who earn both the CPA and CMA certificates are counted on for their expertise in both accounting and business. Management accountants with a CPA can apply their breadth of knowledge on accounting to various decisions, adding great value to their organization. Likewise, public accountants with a CMA are able to better understand their clients and increase the value of their advice.
In fact, many students start off by earning their CMA because it’s faster to get, and they can earn it while meeting the additional education requirements of the CPA. The CMA exam is also much cheaper to get while in school, saving students money. Remember, you don’t need to meet your education or experience requirement for CMA until 7 years after enrolling in the program.