This week’s episode is especially exciting because you will be hearing from a very distinguished guest in the CMA community.
Nathan: Hi fellow accountants. This is the free CMA exam mastery course. Thank you so much for joining me today. And because you are here today with me, I have a present for you. Go to cmaexamacademy.com/guide to download your free copy of my book, "The Ultimate Guide to the CMA Exam" and use coupon code "(listen to the episode to get your coupon code)" at checkout to claim a 100% discount.
There's no catch but it's only available to the first 100 listeners who take action today. I am so excited about today's episode because I have a very special and distinguished guest joining us. Since 2008, he's been the president and CEO of the Institute of Management Accountants or IMA for short, and since assuming that role, the IMA has become one of the fastest growing accounting associations in the world. This is very exciting. And my guest was honored by Accounting Today by being included in the publication's annual top 100 most influential people list for the last four years. And he was also named by Trust Across America as one of the top 100 thought leaders in trustworthy business behavior for five years straight, and was honored with the organization's lifetime achievement award.
Jeff Thomson, welcome to the show. How are you?
Jeff: Hey, Nathan, thank you very much for having me. It's a pleasure to be here and always a pleasure to talk to the group about the CMA program and its benefits on careers and organizations. Thank you so much.
Nathan: Fantastic. So, prior to this interview, I asked my audience to send me questions that they would like me to ask you. So these questions are coming straight from CMA candidates who are interested in becoming a CMA. So, you ready to dive in?
Jeff: I sure am. I'm looking forward to it.
Nathan: Fantastic, so let's start with the first question. Could you tell us what the CMA designation is and could you also give us a brief history of this designation?
Jeff: Sure, Nathan, I'd be glad to. And by the way, I earned my CMA in 2010. I'd often thought about earning the CMA back when I was a CFO at AT&T in one of our strategic business units, but when I became CEO of the organization in 2008 and was talking about the CMA program around the world, I said, "You know what? I need to become a CMA." I actually started out in the four-part program, so I took part of that. And then, of course, we announced the two-part program, so I have experience in both.
And so I know about it firsthand and became a proud CMA in August of 2010.So the CMA credential has been around for over four decades approaching its 45th year. We believe it is the leading management accounting credential in the world. It's US based but it's a global passport. There are CMAs in over a hundred countries and it really spans the work and competencies that today's CFO team covers or aspires to cover. It's not just accounting, it's finance and accounting, it's financial planning and analysis.
It's a combination of values, stewardship, safeguarding of assets, corporate accounting with corporate finance, financial planning and analysis, risk management. Without going into all of the topics, maybe that will be a later question, but it really does cover what CFOs and their teams need to be doing not only to protect the business but to also help grow the business. And that's what our two-part exam covers as I said, going on 45 years. The first US-based global management accounting certification and the leading one in the world right now. And we're growing at about 25 to 30% per year and we also are very proud of the consistency, integrity, and reputation of the CMA program.
Nathan: Incredible. Incredible what you guys are doing over at the IMA, it shows how much you guys are working on this because the popularity is growing every single year. And that's a good segue to the next question which is what is the reach of the CMA designation around the world? And where do you see it going in the next 10 to 15 years?
Jeff: Well, as I mentioned, the CMA program is the only management accounting designation that's prominent in the world's two largest economies, and that's the US and China. There are CMAs in well over a hundred countries, and, quite frankly, as we speak, we're exploring new offices in Southeast Asia, in South America. And, quite frankly, as organizations face challenges of competition and consolidation, and complexity to sustain their growth, they're finding that talented workforce and talented, well-rounded CFO teams are absolutely critical for success. And the CMA is squarely in that discussion in terms of the enabling competencies that are balanced and diverse. Not just the accounting but also the financing and the planning, and the strategizing. And that's what the CMA program covers.
So we expect to hit 50,000 certified since inception and we expect to keep growing number at a pretty rapid pace. It's all about awareness.
Nathan: And creating knowledge that if you're a CEO or board of directors or a CFO and you need to enhance the talent of your team to grow the business, then we believe the CMA program fits right into that discussion.
Jeff: That's a great point. And because the CMA designation is global, in what languages can one take the exam?
Nathan: Well, currently, the exam is, of course, English, and the only other exam we've translated is in China. So it's in simple Chinese. And based on local needs and our own criteria that absolutely will not sacrifice quality, one thing about our exam is we truly believe that it is the most secure, most consistent, and most reputable management accounting credential out there in addition to language quality, and we can assure that the IMA and the ICMA, which is headed up by a colleague of mine, Dennis Whitney, don't know when they take and pass the CMA that they've earned a credential of the highest integrity every single person who is a CMA has passed the test, no grandfathering.
There's been a five-part test, the four-part test, the two-part test but that's the only changes over 45 years. And so, we're very, very proud of our consistency, our high standards, and, quite frankly, for employers that need some more talented workforce and for individuals, our salary surveys indicate that those who earned a CMA make about 60% more on average than those who didn't earn a CMA.
Nathan: That's incredible. That's amazing. What a benefit. And that's a perfect segue to the next question which was what are the benefits of obtaining the CMA designation? You had mentioned a few points but could you expand a little more on that?
Jeff: Sure, kind of a byline or top line we like to use, Nathan, is that the CMA helps to enrich careers, organizations, and the public interest. And by that, we mean in terms of organizations, every organization aspires to grow for profit, not for profit, any size, any structure, anywhere. But to grow with confidence and integrity, we believe requires other things such as the CMA program.
When we asked CFOs around the world and even CEOs, the skills that they're most lacking, it is the CMA types of skills. People that can convert information into insight, they are into decisions, who are thinkers, who ask questions, who are inquisitive, and with the foundation of finance and accounting that the CMA program gives you, we believe that organizational sustainability of growth initiatives is more achievable.
In terms of careers, we believe that because these are skills in very, very high demand, the CMA program is all about differentiation. So an individual with a CMA is differentiated, and as we talked about earlier, on average, our independent salary surveys shows that CMAs earn 60% more.
For the individual, it also gives them more career flexibility and career options. As I said, it spans corporate account and corp fin, MNA work, strategy type work, risk management, and the list goes on and on. And then of course, in terms of the public interest and societal benefits, we are very, very proud that the CMA program itself and inside the content that's tested always stands for the highest standard of professional ethics. We think the way we run the program, the way Dennis runs the program and his team with an independent board, and type, internal controls, and data security, and the fact that not a single individual has been grandfathered into the program, everybody has to take a test, have an experience in education requirement.
So we think the fact that the content covers professional ethics. In fact, once you become a CMA, Nathan, you have 30 hours of continuing education to maintain your CMA. At least two must be in ethics. So we think that from an organization, career, and societal perspective that there are multiple related benefits, and very, very significant.
Nathan: Absolutely. Now, why would an accounting professional choose the CMA designation over other designations?
Jeff: Well, because, and we don't say this with any arrogance or ego, we are very proud of our CMA program... You don't have to be the largest to be the best.
Nathan: I agree.
Jeff: We are not the largest but we are the leading management accounting credential in the world based on growth, based on size, based on reputation, and based on integrity. I've already mentioned that every single individual, except for one, not a funny story but one of those CMA jeopardy questions, but every single person who took the CMA became a CMA past exams, rigorous,focused, relevant exams. And by the way, that one person was not Dennis Whitney who heads ICMA or Jeff Thomson. I had a study like everybody else on planes, trains, and automobiles.
The only person who did not have to take the exam was the founder of the exam 40-plus years ago, Dr. Bullock. I thank the powers to be...Puerto Ricans perhaps said, "You know what, Dr. Bullock, you conceived this exam. Maybe you don't have to take it. We'll give you an honorary CMA."
Nathan: Yeah, fair enough.
Jeff: And, quite frankly, we are disturbed. We are to be candid and respectful of partners in our profession. We are very disturbed by the grandfathering that we see. Write a check become a blank, blank management accountant. We think it's inappropriate. We think it does the public interest a disservice, and we're not going to grow for the sake of growth. We're going to grow with confidence and integrity.
Nathan: Excellent. Thank you very much for that. What are the job opportunities for newly-minted CMAs in the United States?
Jeff: So, in the United States, the reality is that the way you cut your teeth and gain experience could be in many ways. First of all, the CMA program is a great screener for employers. I personally have hired, between AT&T and IMA, and other places, I have personally hired not even dozens but hundreds of entry-level finance team professionals. And after a while, whether you're doing a deal in paper and pencil way of looking resumes or now through Career Builder and create a Monster, and LinkedIn, I don't care what forum and media you're using to evaluate and screen talent, it is hard to differentiate because the expectations are so high for entry-level professionals to hit the ground running with good leadership and influencing skill and a well-balanced set of skill.
So if you have the CMA program, that is a mark of differentiation. And I'll tell you why Nathan. One reason that may not be so obvious is the vast majority of undergraduate accounting students have been subject to curricula that are great curricula but they're very, very heavily skewed towards financial accounting, audit, attestation, tax compliance, regulatory reporting. And for those who start out in the audit track, perhaps with the big four down market, within three to five years, they find their way to a job and industry.
And yet, they've been trained in financial accounting, not management accounting. So from an entry-level or young professional perspective, if you have that CMA, it's a screener. It's a differentiator. It's a way to say, "You know what? This individual is more likely to get up that learning curve and be a great, great influencer in this corporation."
Nathan: Okay. Would you say that the CMA designation benefits in a bigger way to younger professionals versus all the professionals who have been in the industry for a while?
Jeff: Well, since I'm an older professional, I'd prefer to refer to myself as a seasoned professional. Thank you.
Nathan: Very good. Good choice of word.
Jeff: I think the CMA program, in all seriousness, applies anywhere along what I like to call the student to CFO career arch. For a student, and by the way, you can pass the CMA exam while a student. You still need that next step to your experience requirement, and, of course, you need to graduate from an accredited institution or equivalent, but there's no 150-hour rule. You can study for, take, and pass the two-part CMA exam while still a student. And in many ways, while it's still fresh, you're in study mode. Hopefully not in party mode too much, but you're in study mode.
Great time to pass the CMA exam, get that two years of experience and of course, graduate, and you're a CMA. Hit the ground running. Certainly, as a young professional, in fact, we see the greatest salary premium for young professionals. So that's 60% salary premium for CMAs relative to non-CMAs. That's an average. It's actually higher in many cases for young professionals.
And then look, I was a seasoned professional, and I became a CMA. And I could tell you that when I meet with CFOs around the world, and CEOs, and boards because I have a CMA, I'm that much more able to describe the value of the profession and the value of the CMA program. So I think it runs the gamut from student to CFO and even to CEO. We have a fair number of our CMAs who are current or past CEOs and members of major boards.
Nathan: All right, very good. Now this is the last question I have for you, Jeff, and this is the one that I've been asked the most, actually. So how often does the content of the CMA exam change? I know that the last change or the major change was in 2015. So how often do you expect it to change, and when will the next change come about?
Jeff: So, from a process perspective, not to sound like a process geek, but this is where...there is no finer owner, and guide, and coach, and overseer of a credential in the world than ICMA. I really mean that. ICMA is an independent affiliate of IMA. And I really do think that when we talk about internal controls and what I'm going to talk about next, I really think our members and our CMAs would be incredibly proud of the underlying process. To some, it could be like watching paint dry, but to others who like to understand process and that there is really credibility and deep reputational value to the program because of all this work that's been done behind the scenes for over 40 years.
In terms of the process, there's no precise bright line that says, "Every five years, or every three and a half or every 10 years, to some extent, you want it to be market-driven." When you look at the body of knowledge of association management and both Dennis and I, Dennis Whitney, head of ICMA, and I, have another credential called the CAE which is Certified Association Executive. And so when you look in thousands of associations that have a credential, the rule of thumb is usually around five years, five, six years or so that a major change...what you normally do is you do what's called a job analysis.
A job analysis is where you serve professionals in the field and essentially ask them what they do or what they expect to be doing in the short term. So it's not a long-term, futurist type of thing. It's a here and now. I closed the books. I filed statutory reports. I do risk management. I do internal control. I do budgets. I do data mine. Whatever it is, I do. And that data analysis, that job analysis might reveal very little change when compared to the existing body of knowledge.
And so, you don't want to be doing that every 10 years probably because things do move at a certain pace and new responsibilities, new tasks, you probably don't want to do it every year for candidates and because the body of knowledge just doesn't change that often. So five years is a rough rule of thumb.
Nathan: That's good actually. That's very helpful.
Jeff: Yeah and the change that was made in the last year or so was to put more financial reporting back into part one because our members were telling us that they actually used the CMA in some cases in place of the CPA. And not having that financial accounting in going from the four-part to the two-part back in 2009, 2010 was we put that, we tested and studied, and in addition to some other tweaks. So the change in 2015, of course, is relatively minor compared to 2009, 2010 where we moved from four to two-part.
I don't know if Dennis has anything else planned. I don't believe he does. Again, ICMA is independent of IMA although we can follow that up to IMA. Nothing as far as I know is imminent, but that's why we keep it as an independent affiliate to study and concentrate on nothing but the quality and reputation of the CMA program. And we will grow that CMA program, but again, we will do it the right way to ensure that the reputation and the brand remains of highest exemplary status.
Nathan: And then I'm glad you made that point because when the new designation came out and people were paying in to get that designation, I was getting a lot of emails from CMAs asking me, "So Nathan, will the CMA value dilute because of it?" So thank you for sharing that. I think that will put many people at ease knowing that the qua...
Jeff: Right. When you said dilute the value, what were you referring to?
Nathan: The perceived value the CMA designation would be diluted because there's another management accounting designation that came out that people could just pay for as opposed to passing an exam.
Jeff: Yeah, I understand. I thought that's what you said. Yeah, and, you know, we'll leave it to others to what do they think is in the best interest of the organizations and the profession. And IMA, ICMA will continue its steady growth path. Again, not a single individual has been grandfathered and we like to look at the big picture of talent and we just think it's doing the profession a disservice when a fair proportion of your supposedly certified and credential members never had to study for or pass an exam. We actually think that's bad for any brand. Fortunately, the IMA brand was shielded because of its integrity, and steadfastness, and consistency over the course of four and a half decades.
Nathan: Fantastic. Jeff, I appreciate you so much for stopping by today and sharing your expertise and your knowledge with all of us. I know that you've answered a lot of questions that many of my listeners have. So thank you for that.
Jeff: Great, Nathan. It's a pleasure to be here and any IMA member can contact me at any time as a CMA or as their CEO and be glad to chat and talk careers and opportunities and what the CMA could do to...as I said, enrich careers, organizations, and the public interest. So thank you for having me and look forward to engaging further.
Nathan: Definitely. Thank you so much. Where can the listener find more information about you and about the CMA designation?
Jeff: Sure. So, of course, we're all over Facebook and LinkedIn and all over social media and Twitter. Our website, of course, is www.imanet.org. My email is firstname.lastname@example.org. Thomson with no P because I don't know where it would go. And like I said, we're all over social media and digital marketing. So we're pretty easy to find.
Nathan: Fantastic, thank you so much. And I'll make sure to add those links to the show notes for people so they can easily find links, and emails, and what not. All right. So that was the show for today. If you're on the fence about getting your CMA designation, I hope this episode answered a lot of your questions. And if you have any follow-up questions, feel free to reach out to me via email ,or you can email Jeff as well.
He provided his email address, but if you would like to reach out to me, my email's email@example.com and if you have a minute, please leave a review in iTunes. It helps the show immensely. Thank you for joining, Jeff, and myself today as we dived into what the CMA designation is and how we can help you further your career and knowledge. And before I sign off, don't forget to dream big and realize your full potential by becoming a Certified Management Accountant. Until next time.
This man has made Accounting Today’s Top 100 Most Influential four years in a row, Trust Across America’s Top 100 Thought Leaders for five years running, and most recently earned the Institute of Management Accounting’s Lifetime Achievement Award.
So who is he? Jeff Thomson — CEO of the IMA.
I was very excited to pick his brain on all things CMA, so be sure to listen in to this one. You’re going to learn a lot.
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Here’s What You’ll Learn in this Week’s Episode:
- A brief history of the CMA and where they see it going in the next 10-15 years
- The benefits of earning your designation and why it trumps others
- How the USA designation stacks up against its global counterparts
- A realistic outlook on job opportunities available to newly minted CMAs
- Insight into the CMA exam content and how often it changes, and what to expect for future examinations
- How to contact Jeff to chat careers and opportunities
- CMACoach.com — The best online resource for CMA candidates
- The Ultimate Guide to the CMA Exam — Be one of the first 100 listeners to get a FREE download with discount code
- CMAExamAcademy.com — My Instructor-led, online CMA review course
- IMAnet.org — Learn more about the IMA
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