If you are considering a career in management accounting, then we need to chat.
Because the CMA certification is not the only option available.
That’s right, there is another management accounting certification available: the CGMA. So let’s compare CGMA vs CMA:
Many people weigh the relative benefits of CPA versus CMA when deciding which certification would benefit their career the most. CGMA offers a third option. It’s related to a CMA accounting certification, but distinct from it.
The Chartered Global Management Accountant certification is a direct competitor of the CMA. This designation was created in early 2012 and is the brainchild of both the American Institute of Certified Public Accountants (AICPA) and the Chartered Institute of Management Accountants (CIMA).
What makes the CGMA certification different from the CMA and more importantly, which certification is better for you?
Watch this video or keep reading because I’m going to break CGMA vs CMA down for you.
What is CGMA?
While you may already know what CMA is, let’s discuss the alternative. CGMA stands for “Chartered Global Management Accountant.” Like CMA, it’s a certification that accountants can obtain to take on a new specialty and open up new career paths.
To become a CGMA designation holder you need to complete the CGMA Finance Leadership Program, as well as pass the exam.
In case you are unaware, the CGMA certification was first instituted in 2012 to promote management accounting in global contexts. You’ll need to meet certain CGMA experience requirements in order to qualify for this designation, just as you need to meet the CMA requirements to become a Certified Management Accountant.
How Much Does a CGMA Exam Cost?
The CGMA exam cost is $325, payable at the time that you register and schedule your exam date. You’ll also need to meet the CGMA experience requirements in order to sign up. You can register on the CGMA website.
There are four annual testing windows, each of which lasts five days. When you register, you’re only allowed to sign up for the next available window, and you cannot reschedule once the registration window has closed.
Once you become a CGMA certificate holder you are required to pay annual membership fee of $395. If you earned your designation through the AICPA route, you must also pay $180 annually in AICPA dues, or $130 if you are also a member of your state society.
CGMA vs CMA: A Brief History
Both the CMA and CGMA are relatively new designations in the world of accounting. While the CPA has been around since the late 1800s, the CMA was established in 1972. It’s goal was to provide individuals with more in depth knowledge and understanding of financial planning and analysis.
What is CMA (Certified Management Accountant)? It’s an accounting designation associated with strategy, analysis, and managerial roles and considerations.
CMA certified professionals are greatly valued in large multinational corporations, but can work in private or public sectors of any size. Their expertise can open doors to so many amazing opportunities!
Even newer than the CMA is the CGMA. Established in January 2012, this designation’s main goal was to build upon the global reach of management accounting.
Because the CGMA was birthed from both AICPA and CIMA, you can earn this designation through either entity, but eligibility and prerequisites vary.
Eligibility and Requirements
As I mentioned above, the eligibility and requirements for earning each designation vary. In comparison to becoming a CGMA, it is much easier to be eligible as a CMA.
To become a CMA you must earn a bachelor’s degree, join the IMA and fulfill their 2-year consecutive work employment requirement, as well as pass the CMA exam. Work experience must be in a managerial role, but can be made up from public or private accounting, consulting, research or teaching.
The Handbook states:
Qualifying experience consists of positions requiring judgments regularly made employing the principles of management accounting and financial management. Such employment includes:
- Preparation of financial statements
- Financial planning and analysis
- Monthly, quarterly, and year-end close
- Auditing (external or internal)
- Budget preparation and reporting
- Manage general ledger and balance sheets
- Company investment decision making
- Costing analysis
- Risk evaluation
- Management information systems analysis
- Management accounting and auditing in government, finance, or industry
- Auditing in public accounting
If you are unsure whether your work experience counts, you can submit a request with the IMA and they will make individual judgement calls.
On the other hand, to join the CGMA you must go through the AICPA or CIMA.
The CIMA pathway is much more similar to the CMA. Candidates must fulfill 3 years of management accounting work experience, be a CIMA member and pass 12 individual CIMA exams.
For those that choose the AICPA route, you must be a member as well as be an active CPA. This means you must have passed all 4 parts of the CPA exam and earned that certificate prior to getting 3 years of management accounting work experience and then passing the CGMA exam.
If you are ready to start moving your career ahead, then the CMA is the quickest and best option. In order to go the CPA route, you would have to pass 16 exams in total, plus fulfill all the work experience and educational requirements, which would take significantly more time.
I’d be remiss if I didn’t mention a particularly shady aspect in the AICPA’s CGMA past though: when this designation was first launched, the AICPA essentially sold the certification to its current members for a fee.
These individuals weren’t required to fulfill any prerequisites or forced to take an exam. While this is undoubtedly unethical, what’s more troubling is that there are now thousands of practicing CGMAs who may not possess the skill or knowledge required of this designation.
Unsurprisingly, the IMA and its current CMAs were very disappointed. Thankfully, this issue was dealt with and, as of January 2015, all CGMA candidates are required to take the same 3-hour case-study final exam.
CGMA vs CMA: A Full Comparison
In terms of material covered in the required exams, the breadth of management accounting topics covered in the CMA exam far outweigh those of the CGMA exam.
The cost to prepare and take the exam also vary. Here is a quick breakdown of the essentials:
|Format||2 Parts - MCQ and Essay||1 Part - Case Study|
|Duration||4 hours - 3 hours for 100 Multiple Choice Questions and 1 hour for 2 essay questions||3 hours - 3 x 60-minute sections|
|Testing Windows||January, February, May, June, September, October||February, May, August, November|
|Exam Cost||$415 per part plus a one-time entrance fee that ranges from $188-225||$325|
|Review Course Cost||$1,000 - $2,400 depending on provider||$4,395 and provided directly by CGMA|
|Material Covered||Part One - Financial Planning, Performance, and Analytics:|
cost management, internal controls, technology and analytics, external financial reporting decisions, planning, budgeting, and forecasting, performance management
Part Two - Strategic Financial Management:
risk management, investment decisions, professional ethics, financial statement analysis, corporate finance, decision analysis
data analytics, budgeting, regulatory framework, cost accounting, finance technologies
cost management, financial statement analysis, leadership and management
business models, organizational performance
financial objectives, risk oversight, internal controls, strategy formulation and execution, regulatory compliance
|Designation Maintenance||30 hours CPE per year + IMA membership fee ($39 - $245)||Membership fee of $395 + annual dues to AICPA (for CPAs)|
Do Employers Want CMAs or CGMAs?
Over the past few years there has been an increasing need for CMAs in the workplace. As the designation becomes more internationally recognized, more and more employers are supporting it.
On top of being more well-known, employers are looking for the unique skills that CMAs possess in terms of management accounting and financial analysis.
This desire for CMAs isn’t just located to those in the United States either. It is widely recognized globally and especially popular in the Middle East with ever growing numbers of candidates.
With only a handful of years experience, the CGMA designation is slowly establishing itself. In fact, CGMA designates are found in 91 of the Fortune 100. However, this certification will need a few more years to establish itself in terms of reputation and execution of knowledge.
CMA Salary vs CGMA Salary
CMA salaries vs CGMA salaries compare favorably, though CMAs earn slightly more. The median CMA salary in the US is $115,000 per year, according to the IMA. The average CGMA salary in the US is $89,000 per year, per recent statistics from the official CGMA website.
As this cannot be officially verified by either governing body, I highly recommend taking into consideration the average annual salary of non-CMAs as listed in the IMA global salary survey.
This may be a more accurate representation of your potential CGMA salary, based on the CGMAs lack of popularity and relative newness.
When choosing a career it’s fairly safe to say that many people take salary into consideration. When you are financially investing in your future, then you want to make sure it has ROI.
The decision to choose CGMA vs CMA is a highly personal one. It really comes down to what your career goals are.
Should you choose to go the CMA route, I would love to help you pass the CMA exam. Check out how I can help you pass on your very first try with my CMA Exam Academy.