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A certified managerial accountant is an accounting professional who has successfully completed the Institute of Management Accountants’ Certified Management Accountant Program and been awarded the highly respected certified management accountant credential. Like its better-known counterpart, the certified public accountant designation, the certified management accountant credential is not easy to earn. To do so, accounting professionals must meet rigorous standards for education and professional experience and pass a comprehensive two-part examination.
What is Managerial Accounting?
Also known as management accounting, managerial accounting is a specialized branch of accounting that blends business management, finance and accounting practices. Professionals in this field monitor a company’s financial health by overseeing its spending, creating financial controls and conducting internal audits. They also help managers develop business strategies and safeguard stockholders’ interests by completing assessments of risk and identifying the possible financial ramifications of business decisions.
How Does an Accounting Professional Become a Certified Managerial Accountant?
The premiere credential in managerial accounting, the certified management accountant designation was established in 1996 by the Institute of Management Accountants. Candidates for the credential must join the Institute of Management Accountants, possess an appropriate bachelor’s degree that was conferred by an accredited college or university, and have at least two years of professional experience in the financial management or accounting fields. They must also apply to enter the institute’s Certified Management Accountant Program. A self-paced program, it typically requires one to three years to complete. Participants may study independently online, join online study groups or take part in instructor-led classes. When they feel that they have a firm grasp of the material, they must prove their competency by successfully completing the Certified Management Accountant Exam. After being awarded the certified management accountant designation, these professionals must remain members of the institute and fulfill the institute’s requirements for continuing education to maintain their status.
What Material Is On the Certified Management Accountant Exam?
Administered by Prometric, the Certified Management Accountant Exam is a computerized exam with two parts. Each part consists of both essay and multiple choice questions and takes four hours to complete. Part One: financial reporting, planning, performance and control is designed to assess a candidate’s understanding of cost management, budgeting, external financial reporting, performance management, internal controls and forecasting. Part Two: financial decision making evaluates proficiency in risk management, investment decisions, corporate finance, financial statement analysis, decision analysis and professional ethics.
Why Do Accounting Professionals Pursue the Certified Management Accountant Designation?
This globally respected designation appeals to employers, offering those who hold it expanded career opportunities and clear financial rewards. According to the institute’s 2014 International Salary Survey, certified management accountants in the United States earned an average of more than $120,000 in total compensation for the year, over $40,000 more than their uncertified peers. In fact, certified management accountants earned salaries that were approximately one-third higher than those of noncertified professionals in the Americas, Asia, Europe and Africa.
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Accounting is a surprisingly diverse field that offers those who enter it a rich assortment of potential career paths and professional credentials. Individuals need to carefully consider their career goals and decide which credentials best suit their planned path. For someone interested in becoming a certified managerial accountant, the certified management accountant designation is a professionally and financially rewarding choice.