Understand Difference

CPA vs CMA Certification: Which is Right for You?

Introduction to CPA and

CMA Certification

Certified Public Accountants (CPA) and Certified Management Accountants (CMA) are two of the most highly esteemed certifications in the accounting industry. These certifications demonstrate an individual’s knowledge and expertise to potential employers and clients.

In this article, we will delve into what CPA and CMA certifications are, what each job entails, their respective benefits, and the requirements to achieve them.

Meaning and Definition

CPA stands for Certified Public Accountant. It is a license that provides an individual with the legal authority to practice public accounting.

The CPA certification is awarded to those who have passed the Uniform CPA Exam and fulfilled the requirements set forth by their respective state boards of accountancy. On the other hand, CMA stands for Certified Management Accountant.

The CMA certification is awarded by the Institute of Management Accountants (IMA) to those who have passed the CMA Exam, have completed a requisite amount of education and experience, and adhere to the IMA’s code of ethics.

Differences in Job Responsibilities

The job responsibilities of a CPA and a CMA are quite distinct from one another. CPAs are typically involved in public accounting, which includes auditing, taxation, and financial statement preparation.

They are responsible for ensuring that a company’s financial statements are accurate and comply with Generally Accepted Accounting Principles (GAAP). They may also provide advisory and consulting services to clients.

On the other hand, CMAs focus on management accounting and are typically employed by private corporations. They are responsible for managing a company’s financial operations and providing financial analysis for decision-making.

They work with management to develop budgets, forecasts, and financial reports that assist in strategic planning.

CPA Exam Requirements

To become a CPA, you must pass the Uniform CPA Exam, which is administered by the National Association of State Boards of Accountancy (NASBA). The exam consists of four sections: auditing and attestation, business environment and concepts, financial accounting and reporting, and regulation.

Candidates must pass all four sections within 18 months of passing their first section. In addition to passing the exam, CPA candidates must also complete 150 hours of coursework and have relevant experience in public accounting.

Benefits of CPA Certification

The CPA certification can open doors to many opportunities in the accounting industry. CPAs enjoy higher salaries than non-certified accountants, and certification can help them advance their careers more quickly.

In addition, CPAs are well-respected and trusted professionals who can provide valuable advisory and consulting services to clients.

CMA Exam Requirements

To become a CMA, candidates must pass the CMA Exam, which consists of two parts: financial planning, performance, and control, and financial decision-making. Candidates must also possess a bachelor’s degree or an equivalent level of education, complete two years of management accounting or related experience, and adhere to the IMA’s Statement of Ethical Professional Practice.

Benefits of

CMA Certification

The CMA certification can provide many benefits to those in the field of management accounting. CMAs are highly valued professionals who are often promoted to senior management positions and enjoy high salaries.

With a deep understanding of financial analysis and strategic planning, they can provide valuable insights to their companies.

Conclusion

In conclusion, the CPA and CMA certifications are essential credentials for individuals seeking career advancement and professional recognition in the accounting industry. CPAs and CMAs have distinct job responsibilities, and their respective exams and requirements reflect those responsibilities.

Certification can provide many benefits, including higher salaries, faster career advancement, and recognition as trusted professionals.

CMA Certification

The CMA certification is a well-known certification for accounting professionals who are looking to specialize in management accounting. Obtaining this certification requires successfully passing two tests, meeting an education requirement, and fulfilling management accounting work experience.

In this section, we will dive deeper into the requirements of the CMA exam and the many benefits and advantages conferred by earning this certification.

CMA Exam Requirements

To be eligible for the CMA certification, an individual must have a bachelor’s degree in accounting or another related field. Alternatively, they can have an equivalent level of education.

Candidates who don’t have a degree and/or educational qualification that is equivalent must have additional work experience in management accounting to compensate for the educational requirement. This experience should be acquired after graduation and should be under the guidance of someone who holds the CMA certification.

In addition to this requirement, individuals must also have at least two years of continuous work experience in management accounting, primarily related to financial planning, analysis, and control. This experience must be obtained within seven years of completing the CMA exam, or it can be gained before or during an individual’s candidacy for the CMA certification.

The CMA exam is conducted in two parts. The first part focuses on financial planning, analysis, and control.

The second part focuses on financial decision making. Each part consists of 100 multiple-choice questions and two essay questions that test the candidate’s knowledge of various accounting and financial management skills.

The exam is given every year during specific testing windows.

CMA Salary and Benefits

The earning potential of the CMA certification is considered high compared to other accounting certifications. According to the IMA’s 2020 Salary Survey, CMAs in America earn an average of $115,000 per year and around $7,000 more than the average salary of non-CMA certified accountants.

Additionally, the CMA certification can allow individuals to advance their careers more quickly and take on positions of greater responsibility within their organizations. Employers often seek CMAs not only for their financial expertise but also for their broader business acumen, which makes them ideal candidates for executive-level positions.

Importance of Accounting Certification

Accounting certification is becoming increasingly essential in today’s highly competitive job market, and the reasons for this are straightforward. Certifications play a vital role in displaying professional competency, knowledge, and aptitude, indicating a high level of achievement and educational attainment.

In this section, we will delve deeper into the various reasons why obtaining accounting certification is crucial.

Advantages of Accounting Certification

One of the most significant advantages of obtaining accounting certification is the edge it provides over non-certified professionals. An accounting certification demonstrates a higher level of completed education and professional competency, which are crucial components that employers look for when hiring accounting professionals.

Additionally, it serves as tangible proof of an individual’s dedication and proficiency in the field of accounting, helping increase trust and respect from potential employers.

Continuing Education for Accountants

The accounting industry is ever-changing, continuously adapting to new laws, regulations, and technologies. For this reason, it is essential for accounting professionals to remain competent and relevant by acquiring additional knowledge and skills throughout their careers through continuing education.

Many states require accountants to participate in continuing education courses to maintain their licensure. However, even without these requirements, accounting professionals should take advantage of training opportunities and courses to keep up with accounting trends and sharpen their accounting skills, ensuring they remain relevant in the industry.

In conclusion, accounting certification is a vital tool for accounting professionals to advance their careers and enhance their credibility in the industry. The CMA certification is an accounting certification that allows accounting professionals to specialize in management accounting, opening new doors for career advancements.

In addition, continuing education for accountants is essential to remain competent and relevant in this ever-changing industry and help improve one’s accounting knowledge and abilities. In conclusion, CPA and CMA certifications are highly acclaimed credentials that showcase an accounting professional’s knowledge and expertise in their field.

These certifications offer different job responsibilities, requirements, and benefits, but possess similar advantages of higher salaries, career advancement, and employer trust. Accounting certifications provide professionals with the necessary skills, knowledge, and abilities to excel in the ever-changing accounting industry.

It is critical to remain in sync with the new laws, regulations, and technologies through continuing education courses to maintain relevance. Overall, obtaining accounting certifications and engaging in continuing education opportunities serve as strong assets to advance an accounting professional’s career and increase credibility, leading to a brighter future.

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