CMA vs CPA & Other Certifications. Which Is Better?

Frank Armenio's Profile

CMA vs CPA

There have been recent discussions about the CPA certification and its relevance to the hiring process.  Many of the discussions involved the debate on whether a CMA vs Certified Public Accountant and not having a CPA should be a must have for finance professionals such as CFO's or Controllers. 

I would like to hear thoughts about senior financial professionals who hold other relevant professional certifications other than the M.B.A. or CPA, such as the CMA or CFM to name a couple.  Both the CMA and CFM are sponsored by the IMA and stand for a standard of technical excellence in the accounting profession.   The issue out there is that they are not as well known as the CPA credential.  So one question would be if one of the must haves in a job description is a C.P.A. or C.M.A. or CFM be a reasonable substiitute?  These credentuials may be more relevant to private industry than the CPA which focuses on public accounting.  They deal with real issues faced by a CFO/Controller such as managing the treasury functions, cost accounting variance analysis (for manufacturers), mergers and acquisitions, financial statement analysis, working capital management in addition to financial accounting and corporate taxation topics.

Your thoughts on this would be appreciated.

Answers

Member's Profile

A career as a CPA can have all of the experience you mention in your inquiry. The public experience is what leads many CPAs to be CFO/Controller. Experienced CPAs who transition from public to industry have Treasury experience, variance analysis and relevant operational experience along with SOX, deferred tax, tax planning, M&A due diligence, and electronic financial reporting skills. The more experience a CPA has the more valuable he/she is to the prospective company. Nothing beats the experience a CPA receives from working in various functions. Many CPAs keep their "pencil" sharp through CPE of all kinds. The educational training (Formal and CPE) results in many CPAs having advanced degrees, MBAs, etc. You should network with your State or City CPA chapter or contact the AICPA. The experience of the CPA is not to be underestimated or taken for granted. My CPA certificate is dated 1971 and I am still working and improving company processes, IT systems, internal controls, budgets, strategic planning, etc. Even today, many businesses need improvement in how efficiently they process electronic data that emanates from the factory floor. I hope this helps.

To comment, and for full access, login or register
Member's Profile

I appreciate the commments regarding the benefits of the CPA but I believe the reader making the comment is mis-understanding the main point. It is very clear the how valuable the CPA can be as a credential and not too many could dispute this. The question is what about the value of other certifications such as the CFM and CMA vs CPA, which also have CPE requirements that keep the CFO/Controller knowledge on the cutting edge? The question is are these reasonable alternatives to the CPA when hiring a CFO/Controller? In addition, many CMA's have advanced degrees such as an MBA as well. Is the CMA or CFM credential being under estimated based on lack of knowledge by hiring managers?

To comment, and for full access, login or register
Member's Profile

Frank, you might also be interested in Proformative's free
"Career Resources Guide:"

http://www.proformative.com/resources/career-resources-guide

Enjoy!

Best... Sarah

To comment, and for full access, login or register
Member's Profile

First of all, I am a CMA with an MBA. I highly value both the CPA Certificate and the CMA as well. The reason that I chose the CMA Certification is that I have no desire to work with taxes or the SEC. My passion is working with management to where I can be of great assistance in helping them to achieve their goals and objectives within the guidlines of the Mission Statement. This would include Cost Accounting and Cost Systems, Job Orders, Inventory Control, Physical Inventory Coordination, Budgeting and Forecasting(especially at the departmental level), Variance Analysis, "Root Cause" investigation and analysis, process improvements and cost improvements and so on. These are basically the issues and processes internal to an organization.
While CPA's can also be involved with these, I see the CPA as mainly dealing with outside interests to the firm. This means financial statements and annual reports that are filed outside of the firm, SEC and other regulatory filings, banking and financing, consolidations, external audits to satisfy regulatory requirements and so on.
Having said all of this, I feel that the CPA certification would be more meaningful for a CFO or Treasurer, while the CMA certification would be more meaningful for a Controller.

To comment, and for full access, login or register
Member's Profile

After 30+ years as both CFO and Controller I find it interesting and frustrating that hiring managers believe that a CPA requirement translates to operational experience. When I was in grad school I made the decision not to obtain a CPA, because I was not going into public accounting (audit or tax), so I saw little value in the designation. Since then I have not found any inability on my part to keep abreast of my ongoing technical education nor my ability to deliver in my job. In fact, when hiring staff level accountants I found that most CPAs coming out of a public accounting background needed more mentoring to transition into an operational environment. This was true in both public and private companies. I will always favor someone with an accounting degree and actual operational experience over a CPA coming out of the public accounting sector.

To comment, and for full access, login or register
Proformative Advisor
Member's Profile

Amen to David's comment -- designations do not prove ability. For that, I look to practical experiences as can be evidenced by results. Credentials such as CPA, CMA, and CFA evidence that someone can pass a test, but little else. Experience demonstrates ability.

To comment, and for full access, login or register
Member's Profile

To Jim's comments. Jim I would have to respectfully disagree with part of what you are saying. I do agree that experience is critical and should override any credential or certification. However, the experience coupled with the certification I believe says a great deal than just passing a test. These tests such as the CPA, CMA/CFM and others are quite rigorous and demand a mastering of accounting/finance concepts that can also be used on the job to help enable the experience building process. The theory and practical concepts in these exams can be used as building blocks and applied to the work place. All things being equal I would hire someone with great experience and the professional certification rather than just the person with the experience alone. Furthermore, it has been proven that a person with a professional certification is worth more in the marketplace than one without one.

To comment, and for full access, login or register
Member's Profile

To David's comment: I found this to be very useful insight. There have been many different layers to this overall discussion with 960 reads on this discussion so far and counting. I do believe we struck a nerve out there! David I completely agree with you and this is the "truth" rather than "perception". Unfortunately many other folks out there hiring for CFO/Controller jobs do not "get it" yet. They are still stuck on the fact that the CPA is a must have on the job hiring criteria. Think about this when you see these ads for CFO/Controller jobs. Lets say you have great operational experience and have gone the extra mile to obtain a professionall certification such as a CMA/CFM to try and stay competitive with the CPA's. Yet, many of the folks that make up this profile cannot even get in the door to state their case for the job because they are disqualified for not having a CPA. This is the harsh reality but it does not make it right. Perceptions can change if pushed hard enough. This discussion is a start with people like yourself giving your input.

To comment, and for full access, login or register
Member's Profile

I am currently thinking of pursuing my CPA. I went back to school and obtained an MS in Accounting. Got the sheepskin, but cannot get a job. Why? No experience. It was a job change for me as I worked over 20 years for a bank. My dilemma is that I have no real experience. So how does one get the experience? I know I could do the work, but cannot find anyone to hire me or even give me a chance to find out what area of accounting I would like to go into. I took a class in Forensic Accounting and thought that would be a great field. But again, HOW DO I GET THE EXPERIENCE NEEDED?

To comment, and for full access, login or register
Member's Profile

Hi John,
Have a question to you as you are an experienced CMA. I was working on the management accounting paper for my accounting exam (ACCA) and found the variance analysis a bit "overwhelming". The problem is when I read the book, it is "somewhat clear and logically"....but when i sat the exam the case study just bamboozles the einstein out of me. As you have practical knowledge of variance applications, could you shed some light on how do you approach a variance case (specifically cost variances in a manufacturing environment).

Basically i think i m good with finance, etc but "variance" always makes me wary ;)

thanks in advance and happy holidays
Amit

To comment, and for full access, login or register
Member's Profile

There are a lot of good and valid comments above. I hold multiple certifications (CPA, CVA, Certified Rate of Return Analyst CRRA) In my opinion the CPA is the "Core" demonstration of capability and the other designations demonstrate further expertise in specific areas.

To comment, and for full access, login or register
Member's Profile

Let me toss a bomb in the discussion :). I would venture that from a CFO's perspective and much of the perspective of senior finance and accounting execs in the U.S., the CPA has great value as a hiring credential and the CMA and CFM has markedly less value. And I mean a lot less value. I am not taking anything away from the professionals who hold those certifications, I am simply saying that the "value", the perceived value or even the "brand" value of having the CPA is simply far, far higher in the U.S.. That is also not to say that those familiar with the CMA/CFM would not value them, but they are simply way behind the CPA in terms of credibility and brand value. Please, noone take this personally, just my take and my experience.

To comment, and for full access, login or register
Member's Profile

No offense taken by the last comment. Mark just hit on the real issue which is "perceived value" vs. real value. This is the core issue that many CMA's and CFM's run into when competing against CPA's for CFO/Controller roles. Trust me on this since I have been there many times. Mark is correct regarding the "perception" of value of the various credentials. I would argue this is mainly the case because of the lack of visibility and knowledge that is out there among decision makers regarding the CMA and CFM credentials. I cannot tell you how many times I have been asked what these credentials are about. Its really a numbers game because there are far more CPA's than holders of these other certifications for obvious reasons due to the public accounting path that many accounting majors follow. However, if the decision makers actually do the research regarding the content of the exams and the rigor involved in the certifcation process it is my view the perception can start to change. The IMA in there marketing and promotion of the credentials can also play an important role here. I truly understand the perception argument and it is real. However, if you peel back the content, and rigor of what it takes to achieve all of these credentials (i.e. CPA, CMA, CFM) you will find that they are all very close. But I agree this is not the "perception" out there.

To comment, and for full access, login or register
Member's Profile

I agree with Mark's assessment. It appears to me that some of these employers believe that unless you have a CPA you don't have a clue what a debit and a credit is. I have worked as a Controller for a public company and filed 10Ks and 10Qs for may years and I have a CMA and a CFM but when it comes to applying for a position I get automatically excluded from the top applicants because I don't have a CPA.

To comment, and for full access, login or register
Member's Profile

Markus this is great input and are a perfect example to continue this discussion. Do you agree that this perception should be changed? You mentioned you are the Controller of a public company and file SEC reporting and have a CMA and CFM. Does it not make you feel frustration when you are excluded from positions because you do not have a CPA but have work every bit as hard to acheive the CMA and CFM credentials and are as capable?

To help settle this debate lets hear from folks who have both credentials (i.e. CPA and CMA or CFM). The folks who have CPA's will bring their bias to the debate and the folks who have the CMA and CFM have their bias. To be bring more objectivity to the debate lets hear from folks who have both credentials to compare and contrast. I know your out there!

To comment, and for full access, login or register
Member's Profile

Everywhere in the world - the subject seems to be a favourite debate. In India, it is CA vs. ICWA the equivalent of CPA & CMA qualifications. Even though the syllabi and experience requirements are equal, because of Government patronage and employers' preferences make CA/CPA more attractive. Being pioneering qualifications, they have advantage of being early entrants to the field. Moreover, CPA/CA guys would have already occupied top positions in Finance and naturally they prefer to appoint the guys of their own ilk. In addition, the employers are more influenced by External reporting requirements because of the hype surrounding the same AND they think that CPA/CA would be of better bet.

CMA/ICWA are great qualifications to acquire because they lay emphasis on three pillars - Performance, Strategy and Management. They are more useful and fit to organizations internally. CPA/CA are on the other hand are more fit for external reporting requirements.

CMAs all over the world need to create a brand equity and shall work in that direction.

To comment, and for full access, login or register
Member's Profile

I have come in late on this discussion, but I believe it is extremely important for hiring managers to know the similarities and the distinctions. I have both the CPA and the CMA. I acquired my CMA in Canada in 1995. In Canada, obtaining a CMA is just not an academic exercise of passing an exam. Yes you do have to pass an exam called an "Entrance Exam". Following that you enter the "Professional Program" for 2 years and at the end of it write another comprehensive exams. Part of the requirement for being in the the program is to be working full-time in industry where the concepts learned could be applied at the workplace. The learning process combines formal and non-formal means. Once a month, there is required reading and submission of course work and every 3 months you meet with your course mates over the weekend in a hotel to go over the required readings with an instructor. You will also be required to participate in team work and do individual or group presentations. The program I went through concentrated on advanced management concepts, such as leadership, business-government relationship, change management, operations and project management, etc and specialized cost accounting areas such as ABC/ABM, special purpose costing for electricity, oil & gas, etc. In effect it is an MBA program. This is a rigorous program and I wish finance professionals aspiring to senior management will go through this. In fact this is why the CMA designation in Canada has courted engineers and other non-accounting professionals to obtain that credential.

I obtained my CPA certification in 2001 upon moving to the States in the late '90's, because I quickly found out that the public perception of the CPA far outweighed the CMA. Whereas the distinction is known in Canada, and therefore most Controllers and many CFO's are CMA's, over here in the U.S. it is not the case. Part of the reason is that the CMA society has not done a good job with the brand. Secondly instead of the CMA certification competing with the CPA, it rather competes with the MBA.

I humbly disagree with those who say that certification does not matter. It does, not because I have one or two, but because in my experience working with those who don't have, there is a marked difference. One of the things I have found to my dismay here in the U.S is that many accounting graduates take the minimum accounting courses necessary to graduate. The reason lies in the over concentration on GPA scores, which non-accounting courses help boost. I have worked with a number of these graduates and they lack the understanding of certain accounting concepts as they face them. No wonder, the CPA pass rate was in the low 20 percentage rate and precipitated the change to a post-graduate level candidate. In fact many CMA's in Canada have the CPA designation as well. Not only that, but the CMA society in Canada is professionally affiliated with the AICPA here in the States. As I write, the CA (equivalent of the CPA) in Canada are in merger talks with the CMA's in Canada. The distinction has blurred to the point that each is encroaching in the other's area of expertise. CMA's can now audit and be in public practice.

Yes experience matters but it can only take you so far as the same things you've mastered is presented to you. The certification comes in handy when you are no longer in the comfort zone created through experience. In as much as the public perception rates the CPA over the CMA, it would do those with a CMA certification to go for the CPA as well. After all each designation has its strength. I have worked with a Controller with a CPA with public practice experience who did not quite get the complexities in variance analysis and costing. I have dealt with a few CPA's in industry who should have stayed in public practice. There is certainly a difference between looking over the work of an accountant to pronounce whether the figures presented were fairly stated and actually knowing how to produce those numbers. I have also worked with CMA's who did not quite understand the mindset of the auditor coming to audit the books and therefore contributed in no small way to lengthen the audit.

In all honesty, I treasure my CMA more than I do my CPA, because of how much I have relied on that training. I remember how in the 90'S a large company I worked for hinted that they were going to implement value management(EVM), none of my CPA colleagues knew about it. To this day if you talk about ABC/ABM, most CPA's in industry know it exists but they don't know what each stands for.

Like I have always explained to my non-accountant friends, the CMA has an analytical (mathematical) mind suitable for industry's growth, while the CPA has the mind of a lawyer, dealing with precedence and rule-based concepts, suitable in explaining things to the government and investors.

To comment, and for full access, login or register
Member's Profile

I agree, Mark. Companies have placed a much higher brand value on the CPA in the marketplace -today- than the CMA and CFM. And particularly when combined with an MBA.

To comment, and for full access, login or register