CPA vs CMA: Salary, Responsibilities, License Requirements & Other Key Differences Explained

When deciding on CPA vs CMA, individuals should consider the type of career they want to pursue.

CPA-qualified individuals have a broad accounting background, working in auditing, attestation, and tax in a public company.

CMA-qualified individuals work in public or private companies as management accountants.

What Is a CPA and CMA?

There are two ways that individuals in the US can become qualified accountants. One is to become CPA or Certified Public Accountant qualified, and the other is to become CMA or Certified Management Accountant accredited.

Both qualifications are equally challenging yet are slightly different.

The CPA is a professional accounting accreditation awarded to individuals who meet specific educational and experience requirements and pass the CPA Examination in the state where they wish to practice accountancy.

CPAs are licensed to provide various accounting and financial services, including auditing, tax planning, and consulting. They often work in public accounting firms, corporations, or government agencies.

A CMA is a professional certification for individuals in management accounting and financial management. CMAs typically work in financial management, cost analysis, and strategic planning roles within organizations.

To gain the CMA designation, candidates must meet educational and experience requirements and pass the CMA exam. The exam covers topics including financial planning, financial controls, and analysis.

What Is the Difference Between CPA and CMA?

There are a few differences between the CPA and CMA. They both have their unique benefits.

The main difference between the CPA and CMA is around qualification recognition. In addition, the CPA is a US license, compared to the CMA, a globally recognized certification.

Other differences include:

Type of Work

CPAs have a broader scope of work. They can provide auditing, taxation, financial accounting, and consulting services.

They are often involved in public accounting, where they audit financial statements, prepare tax returns, and offer advisory services to clients.

CMAs specialize in management accounting and financial management. They primarily focus on internal financial management, cost analysis, budgeting, and organizational strategic planning.

Educational Requirements

In the United States, individuals must have a bachelor's degree and a specific number of semester hours of college education to become a CPA.

This includes specific coursework in accounting and related subjects. Hours may differ depending on the state.

To become a CMA, you need a bachelor's degree from an accredited accounting, economics, or business institution. The 150-hour requirement is not mandatory in most cases. Candidates require two years of experience in management or financial accounting to become a qualified CMA.

Examination Fees

The cost of sitting and becoming fully qualified in the CPA or CMA exams differs.

As individual US states regulate the CPA exam, the cost to register, along with the cost of each of the four exams, can vary. Generally, individuals can expect to pay around $1,500 for the CPA exam.

As the CMA exam is regulated by one accountancy body, the fee to sit all sections of the exam remains the same, irrespective of where a candidate is based. Candidates can expect to pay $1,000 to sit the CMA exam.

Regulation of Qualification

Another major difference between CPA and CMA is how the qualifications are regulated. Individual state boards of accountancy regulate the eligibility and academic requirements to sit the CPA exam and qualify. This means eligibility and licensing requirements vary by state.

The CMA qualification is internationally recognized. The Institute of Management Accountants (IMA) regulates and awards this qualification.

While state-specific regulations do not bind the CMA, candidates must meet the IMA's requirements to qualify for CMA accreditation.

Time to Complete

Those taking the CPA qualification have up to two years to complete all four exams of the CPA qualification.

As individual US states regulate the qualification, candidates should check the requirements in their registered state. The CMA qualification must be completed within three years.

What Is a CPA?

The CPA exam comprises four sections. Each section assesses individuals in a different area of accounting and business.

The four sections are:

Auditing and Attestation (AUD)

The AUD evaluates candidates' working knowledge of auditing procedures, audit engagements, and preparing, compiling, and reviewing financial statements. There are 72 multiple-choice questions in this section, with eight task-based simulations.

The exam covers all aspects of auditing, such as planning and reviewing audit engagements, analyzing and evaluating internal controls, obtaining and documenting relevant information, and preparing relevant communications.

As with FAR, candidates need to demonstrate knowledge of international accounting standards.

Financial Accounting and Reporting (FAR)

This section is often considered the most challenging of all four areas of the CPA. The FAR section evaluates the candidate's knowledge of financial accounting principles and financial statement preparation.

Also assessed are generally accepted accounting principles (GAAP) for business enterprises, not-for-profit organizations, and governmental entities.

Candidates are tested on their ability to apply accounting standards to work-based and tax-based auditing scenarios.

Test takers are expected to prepare financial statements, including balance sheets and income statements. There are 66 multiple-choice questions and eight task-based simulations that use real-life work situations.

Business Environment and Concepts (BEC)

Many individuals believe the BEC section to be the easiest of all four sections on the CPA exam. This section has 62 multiple-choice questions, four task-based simulations, and three written communication tasks.

The BEC section evaluates candidates' understanding of business and economic concepts. Also assessed is their knowledge of financial management, information technology, operations management, and business structure.

Candidates must demonstrate an understanding of corporate governance, financial risk management, financial management processes, strategic planning, and operations management as relevant to auditing and taxation.

This section also evaluates candidates' communication skills, including writing and research abilities.

Regulation (REG)

The REG section focuses on the ethics and professional responsibilities of an auditor or tax adviser.

Candidates' knowledge of federal taxation, business law, and professional and legal responsibilities is also assessed. This section also covers topics such as individual taxation, property transactions, and business structures.

There are 76 multiple-choice questions and eight task-based simulations.

Candidates must pass all four sections of the CPA Exam to become a licensed CPA.

Each section can be taken separately, and candidates can choose the order in which they take the sections. Candidates need to complete all four sections within a designated timeframe. This is usually six to 12 months, depending on the state.

The CPA Exam is known to be challenging. Those taking the exams must spend time preparing for the topics assessed in each section.

What Is the CMA Exam?

The CMA exam is focused on management accounting and financial management.

The exam itself is divided into two parts covering 12 distinct sections:

Financial Planning, Performance, and Analytics

This section assesses:

• External financial reporting decisions
• Internal budget controls
• Cost management
• Performance management
• Planning
• Budgeting
• Forecasting

There is also a section that evaluates technology and analysis in relation to accounting and financial management.

In addition, this section has 100 multiple-choice questions. Candidates must also complete two essays lasting around 30 minutes.

Strategic Financial Management

The strategic financial management section covers six topics. These include:

• Corporate finance
• Decision analysis
• Analysis of financial statements
• Risk management
• Investment decisions

Candidates are also evaluated on their working knowledge and practical understanding of professional ethics working in management accounting or financial management.

This section also comprises two 30-minute essay questions and 100 multiple-choice questions.

The CMA is a computer-based exam that candidates can sit during specific testing windows throughout the year: January to February, May to June, and September to October.

Each part of the exam is four hours long.

The multiple-choice sections of the CPA exam make up 75% of the overall exam score.

Candidates must score at least 320 points out of the maximum 500 to pass the exam. In addition, candidates must pass both exam sections within three years.

Salary Expectations

There isn’t a significant difference between CPA and CMA salaries. On average, a CPA-qualified person is paid around $68,724, whereas CMA’s are paid around $75,000.

Salaries increase based on experience and can vary slightly depending on the organization.

For example, those working in a business sector experiencing growth, such as technology, software, or network communications, may find their salaries higher than other organizations.

CPAs are also hired by both larger and smaller professional services firms, meaning that starting salaries in the larger firms may be higher.

Those qualified as CMAs can work internationally and within the state or country they have qualified in.

It is worth noting that CPA-qualified individuals earn around 15% more than non-CPA accountants.

Those with a CMA make 63% more than those without a CMA. This salary difference shows the benefit of attaining either the CPA or the CMA qualification from both a salary and long-term career perspective.

CMA vs CPA Difficulty

The difficulty of the certified management accountant vs certified public accountant exam varies depending on their strengths, work background, level of preparation, individual strengths, backgrounds, and study habits.

Some of the different factors that contribute to the difficulty of both the CPA and CMA include:

CPA

• The CPA exam covers several topics. These include auditing and attestation, business environment and concepts, financial accounting and reporting, and regulation. The volume of content assessed in the CPA makes the CPA exam challenging.

• The CPA exam requires an in-depth understanding of accounting principles, auditing procedures, and tax regulations. Candidates need to demonstrate a high level of technical knowledge, using their working knowledge of these principles and applying them when answering the exam questions.

• The CPA exam is also known for its time pressure. Individuals must manage their time effectively during the exam to complete all sections within the allocated time.

CMA

• The CMA exam assesses management accounting and financial management. Topics covered include planning, analysis, control, decision support, and professional ethics. Even though the CMA exam doesn’t cover as many topics as the CPA exam, candidates must have strong reasoning and analytical skills, applying management accounting concepts to real-world scenarios.

• The CMA exam consists of two parts so that individuals can focus their preparation and concentration on two areas. Some candidates may find this structure more manageable than the four-part CPA exam.

When considering CMA vs CPA, significant dedication, preparation, and a strong understanding of accounting principles are needed.

Frequently Asked Questions

Final Thoughts

For those looking to pursue a career in the accounting and finance sector, understanding the difference between CPA and CPA is essential in making the right qualification choice.

CPAs have broad expertise working in areas such as auditing and tax regulations. In this type of role, individuals must have comprehensive accounting knowledge.

CMAs specialize in management accounting, focusing on strategic financial planning, analysis, and decision support.

Both the CPA and CMA exams are challenging and require significant preparation before sitting. Individuals must ensure they meet the eligibility requirements for both and be aware of the structure of the qualifications and duration they have to complete all sections.

When considering a certified management accountant vs CPA qualification, aligning career aspirations is essential. Given the minimal difference in salaries paid for CPA vs CMA individuals, consideration should be given to the area of accounting an individual is most interested in, the type of organization they want to work in, and the field they want to specialize in.