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: CGMA vs CMA.
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 different from the CMA and more importantly, which is right for you?
Keep reading because I’m going to break CGMA vs CMA down for you.
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.
CMA certified professionals are greatly valued in large multinational corporations, but can work in private or public sectors of any size. Your expertise opens doors to so many amazing opportunities.
Even newer than the CMA is the CGMA. Established in January 2012, this designations 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
• Preparation of financial statements
• Financial planning & analysis
• Monthly, quarterly, and year end close
• Auditing (external or internal)
• Budget preparation & reporting
• Manage general ledger and balance sheets
• Company investment decision making
• Costing analysis
• Risk evaluation
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 don’t 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-style final exam.
CMA Exam vs CGMA Exam
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:
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 does not appear to be firmly established just yet. Not to mention, employers are a little more hesitant. It looks like this certification will need a few more years to establish itself in terms of reputation and execution of knowledge.
CMA Salary vs CGMA
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.
According to the most recent global salary survey from the IMA, CMAs in the US earn an average total salary of $135,076.
There is no official salary data released by either the AICPA or CIMA, but Payscale.com sites that CGMAs in the US earn an average salary of $115,000 annually.
As this cannot be officially verified b 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 earnings based on the CGMAs lack of popularity and relative newness.
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.