Big news in the CMA world — The CMA exam is changing as of January 1, 2020.
That’s right, the ICMA has been working hard to update and improve the CMA exam and will be rolling out the changes at the end of 2019.
Curious about how that affects you if you’re currently studying to take the CMA exam? Read on for all the details.
Why is the CMA Exam Changing?
When the CMA exam was first designed, it’s goal was to test candidates on the information and tools they would need in the current role of management accounting. As the role of CMAs evolved over the years, so too has the exam.
One of the most notable changes in CMA roles has been a reliance on software and technology, specifically in regards to tasks involving number-crunching. The importance of Certified Management Accountants now is more focused on their ability to analyze and report on these numbers.
Simply put, strategic analysis and advising has become more central to the roles of current CMA’s so the new CMA exam will reflect these changes.
What Will Change In 2020
There are going to be several changes to both Part 1 and Part 2 of the CMA exam. Here is a breakdown of the CMA exam changes by part.
CMA Exam Part 1 Changes
Going into 2020, Part 1 will have a new section; Domain F: Technology and Analytics. This section will now make up 15% of the exam coverage and tackle 52 Learning Outcome Statements (LOS).
In order to make room for this new addition, other domains were reduced in size to accommodate this. Domain B: Planning, Budgeting and Forecasting went from 30% to 20%, and Domain D: Cost Management went from 20%t o 15% of the total exam coverage.
Given these changes, it can be concluded that the ICMA is placing greater importance on a CMAs analytical skills and tasks like critical decision making and data reporting will define the CMA more prominently.
Another notable change is that the section on Internal Auditing will be removed. While it is important for CMAs to understand Internal Controls, the ICMA clearly believes that they should be more involved in the management of controls rather than auditing.
Part 1 of the CMA exam will now be known as Financial Planning, Performance and Analytics and be broken down into the following 6 competencies:
- Cost Management – 15%
- Internal Controls – 15%
- Technology and Analytics – 15%
- External Financial Reporting Decisions – 15%
- Planning, Budgeting, and Forecasting – 20%
- Performance Management – 20%
CMA Exam Part 2 Changes
Similar to Part 1, Part 2 will now have new content, while some topics will be deleted.
Domain F: Professional Ethics will increase in coverage because of the addition of new content. This domain will now test candidates on new LOSs including groupthink, diversity of thought, ethical leadership and traits of ethical leaders, as well as facilitating payments.
These new inclusions will add 5% more coverage to Domain F increasing it from 10% to 15%.
Though Domain C: Decision Analysis will not have any new LOSs, it will increase in coverage by 5% giving it 25% coverage overall.
To make room for the new LOSs and of course, to focus on the more pertinent skills of CMAs, some content was deleted.
Domain A: Financial Statement Analysis will no longer test on off-balance sheet financing and has been reduced to 20% coverage.
Domain B: Corporate Finance cut out several sections; bankruptcy, tax implications of transfer pricing and the distinction between liquidation and reorganization.
There were no changes to Domain D or E in terms of content, however domain D now makes up 10% coverage rather than 15%.
As stated earlier, the biggest changes were to Domain F as it added several new LOSs and removed sections on “methods to monitor ethical compliance” and “requirements of SOX Section 406 – Code of Ethics for Senior Financial Officers.”
Part 2 of the CMA Exam will now be referred to as Strategic Financial Management and cover the following 6 competencies:
- Risk Management – 10%
- Investment Decisions – 10%
- Professional Ethics – 15%
- Financial Statement Analysis – 20%
- Corporate Finance – 20%
- Decision Analysis – 25%
What is Not Changing in 2020?
With all the new Learning Outcome Statements, it may seem a bit overwhelming, but there is good news.
Key components of the CMA exam will NOT be changing at all. For example, the cma exam format, fees, eligibility and registration will all remain the same. The passing score will also remain the same, so essentially the structure of the exam will not be impacted, just the content.
Take the Exam Before the Changes
If you have already been preparing to take the CMA exam I highly recommend you try to pass it before the changes come into effect on January 1, 2020. Here is a list of the CMA exam dates.
The content changes are quite significant and will require you to re-adjust your studying. If you’ve already put in the hours to prepare for sections that will be deleted you will have wasted your time. It is better to test yourself on the knowledge you have already acquired than to try and learn even more new topics.
Most importantly, these changes may cause you to put extra stress on yourself and that can affect your confidence going into the exam.
The good news is you have plenty of time to double down and study in time to earn your CMA certification by the end of 2019’s cma exam testing windows.
CMA Exam Academy’s comprehensive study plan can help you prepare in time to make the final testing window which is September 1 through October 31. In fact, it is designed to help you pass the CMA exam in as little as 6 months. Learn more here.
Avoiding learning new material is obviously one perk of taking the CMA exam before 2020. If you don’t feel like you have enough time to pass both parts one and two before this year is up then I have even more good news for you.
If you have passed one part of the exam you will receive credit for this part of the exam for up to three years. This means you will have 3 years time to complete the second part and then you only need to worry about learning the new material for one Part of the exam, rather than both parts. Simply put, you are not required to take both new versions of the exam if you have already passed one part from the old version.
Perhaps the biggest benefit of buckling down and passing the CMA exam in 2019 is that you will enjoy the perks of having your CMA certification that much sooner!
Certified Management Accountants are in high demand and enjoying higher salaries than their non-certified counterparts. Now is THE time to add this designation to your resume.
It is critical that CMAs have the right skills and knowledge base to do their jobs and these CMA exam changes reflect that goal. As Jeff Thomson, the CEO of the IMA, put it:
“At IMA, we are excited to lead the industry in identifying and publishing critical competencies for the finance and accounting profession […] This work was fully vetted and validated by industry professionals to ensure accuracy and relevancy.”
While the idea of the exam changing may stress you out, just remember that the goal is to best prepare you for your role as CMA in today’s world. The more prepared you are, the greater you will thrive in your new position.
I am excited to see what these CMA exam changes bring. If you are looking for guidance or coaching then I highly recommend checking out my flagship review course, CMA Exam Academy.
With a comprehensive study plan, one-on-one coaching and unparalleled mentorship, I can help you pass the cma exam on your first try.
If you have any questions or concerns, be sure to hit me up in the comment section below.