Is higher education the best path for business and finance professionals to grow their careers, explore new industries and increase earnings? It depends – not all higher learning is the same.
The Certified Management Accountant Credential (CMA) and Master of Business Administration (MBA) are two common and effective ways to progress.
The CMA is a standardized credential that is globally recognized. On the other hand, MBAs vary between institutions and tracks, often focusing on specific industries.
Which is the best path for you? Below, we’ve broken down CMA vs. MBA based on career areas, career outlook, salary, and the pros and cons of each.
What is a CMA?
As mentioned above, CMA stands for Certified Management Accountant and is a credential achieved through a credentialing process. To become a CMA, candidates must complete the following:
- Hold a bachelor’s degree from an accredited post-secondary education institution or hold a related professional certification
- Be enrolled in the Insitute of Management Accountants (IMA)
- Pass the two parts of the CMA Exam
- Abdide by the IMA’s statement of Ethical Professional Practice
- Have two continuous years of work experience in financial management or management accounting
The CMA is an accounting certification and focuses more on the numbers side of businesses. CMAs can occupy staff accountant, cost accountant, financial analyst, finance manager, controller, or financial C-Suite roles.
The CMA Exam has two parts: Part 1, Financial Reporting, Planning, Performance and Control, and Part 2, Financial Decision Making.
The first part focuses mostly on planning, budgeting, and forecasting, but also emphasizes external financial reporting, performance and cost management, and internal controls. This accounting side of the certification focuses on the details management accountants will encounter throughout their careers.
The second part focuses on corporate finance and financial statement analysis in addition to decision analysis, risk management, investment decisions, and professional ethics. This is the management side of the credential. Part two involves big-picture strategy to facilitate growth and stability of organizations.
Recognition of the CMA certification is growing as employers seek out individuals who can think critically and analyze business operations in order to solve the top problems facing organizations today. As a globally recognized certification, management accountants can provide value at international organizations or overseas.
Credential holders have a vast array of opportunities, including working as staff accountants, in strategic management, or in operations.
Pros and Cons Compared to MBA
When considering the CMA vs MBA, you have to compare the time commitment. Unlike the time-intensive MBA, the CMA designation can be completed at your own pace. You can take the two exams in any order, and you can schedule them at any time. The certification is especially attractive to those who have been working in the field but don’t want to go back to school, since they may already have the experience requirement.
The CMA is also attractive because it’s standardized. While the MBA varies in ability and attractiveness depending on institution and focus area, the CMA provides the same exam and requirements for all candidates. Employers will have no need to investigate the details.
On the other hand, the CMA is more limiting than an MBA. While the career opportunities are expansive, it doesn’t necessarily segway into any business role. MBA’s may also enjoy a more detailed experience, taking a track that fits their specific career goals, such as public policy, energy, environment, or sustainability.
What is an MBA?
As we mentioned above, MBA stands for Masters of Business Administration. To become an MBA, candidates must complete a Master’s Program in Business Administration, after which they are awarded a degree. MBA programs vary by institution, with full-time two-year programs, part-time three-year programs, undergraduate plus master’s programs, and professional or executive MBA programs.
MBAs can work in a variety of business capacities. Some MBAs work in financial planning and analysis for individuals, while others work in the strategy department of large organizations. Some start their own businesses, and some become CEOs of Fortune 500 companies.
With such a wide variety of career opportunities, many MBA programs have developed “tracks,” which are a specific set of required classes geared toward a more specialized degree. These tracks are often aimed at some of the world’s top issues, such as sustainability, entrepreneurship, healthcare management, or finance.
The importance of a postgraduate degree is growing in business; companies want to see that candidates are serious about solving business-related problems and have a growth mindset. Additionally, the demand for technical and soft skills is also growing – two areas of focused development for MBA candidates.
Since the MBA is so versatile, degree-holders have a wide range of options in careers. However, it’s important to consider that being on an industry-specific MBA track will narrow your options (but also make you a more desirable candidate within the relevant field).
The average salary for an MBA is dependent on the capacity of the job. An accountant with an MBA might earn an average of $68,000 over the course of her career, while a financial manager with an MBA may make $120,000 or more over the course of her career. Graduates who have applied themselves to a specific track may have a higher earning potential because they possess unique skills related to solving track related problems.
Pros and Cons Compared to CMA
The salary potential is lower for the CMA vs MBA. MBA graduates also have a broader choice of career options, both while they are in school and on the job search.
However, where you receive your MBA plays a major role in where you’ll get a job. Many top companies only hire from the top business schools, and the brand name of your institution will likely play a role in how employers view your resume.
Getting your MBA also consumes two very important resources: time and money. Most schools require a two-year, full-time commitment, while part-time working MBAs can take three years or more. Tuition can range from $2,000 a semester for online programs to $25,000 or more a semester for top schools. Those looking to grow in their business roles have to consider the time and cost implications of achieving an MBA degree.
CMA vs MBA – How Do You Choose?
As you move forward in your career, it’s important to adopt a growth mindset and constantly be on the lookout for ways to improve. Both the CMA credential and an MBA degree can get you there, but one may help you jump on your desired career path more efficiently than the other.
The best way to evaluate the CMA vs MBA and which one is right for you is to assess your career goals and your personal resources and decide which credential will help you achieve your goals with the resources you have. The CMA credential can help you excel in finance and accounting roles within a variety of organizations, while the MBA is more suited to specific industry tracks, such as sustainability or healthcare.
By considering your career goals and what you need to do to achieve them, you’ll have a better understanding of which path is the right one for you.
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Liz Kolar, CPA, CGMA, has been teaching CPA Review for more than 25 years in the United States, has personally taught more than 2,500 live sessions, and has helped thousands of candidates pass the CPA Exam. She founded Pinnacle CPA Review and co-founded Surgent Kolar CPA Review.