FAQ: What Does a Certified Management Accountant Do?

Certified Management Accountant (CMA) is a professional certification credential in the management accounting and financial management fields. The certification signifies that the person possesses knowledge in the areas of financial planning, analysis, control, decision support, and professional ethics. There are many professional bodies globally that have management accounting professional qualifications. The main bodies that offer the CMA certification are:

Since the Canadian body merged with the CPA Canada in September 2015, there are only 2 global bodies that offer the CMA certification, IMA (USA) and ICMA (Australia). However, the certification pathways for the two bodies – in terms of entry requirements, study syllabi and experience requirements are very different and will be explored next.

The U.S. based Institute of Management Accountants USA is one of the two global bodies that offers the CMA Certification. Only authorized partners of IMA can provide coaching to students for CMA USA.[2] CMA (USA)-certified professionals work inside organizations of all sizes, industries, and types, including manufacturing and services, public and private enterprises, not-for-profit organizations, academic institutions, Government entities (USA), and multinational corporations worldwide. To date, there are more than 40,000 active CMAs with more than 80,000 candidates in the current pipeline.[3] To obtain certification, candidates must pass a rigorous exam, meet an educational requirement, experience requirement, and demonstrate a commitment to continuous learning through continuing professional education (CPE).

Certified Management Accountant: An Overview

What does a certified management accountant do?

Depending on their specific role, CMAs can analyze budgets, assess risks and make strategic decisions based on internal financial data. The duties of a CMA depend on their experience level. For example, an entry-level accountant typically spends more time preparing reports, while a senior-level accountant is responsible for budget tracking and making decisions. The primary duties of a certified management accountant may include:

Preparing reports for the controllers department

CMAs with limited professional experience may prepare reports for a controller or controller department. A controller is a manager of an accounting department that oversees accounting staff and ensures that an organization uses assets appropriately. Entry-level management accountants work under the controller to prepare budgets, financial statements and other financial reports. This information helps the controller make decisions for the companys budget allocation and other financial activities.

Preparing financial statements

Managerial accountants are responsible for preparing financial statements for tax purposes and internal use. Financial statements can show how much revenue the company is bringing in, how much theyre spending and their total assets and debts. An income statement shows how much revenue the business brought in over the previous accounting period.

Alternatively, a balance sheet shows an organizations assets versus its liabilities, and a cash flow statement indicates the amount a company is spending versus its expenses. A CMA can use these statements to help senior-level accountants, shareholders and executives make strategic decisions for business initiatives.

Mentoring and supervising accounting staff

As managerial accountants progress in their career, they can supervise other staff, and may help entry and mid-level accountants prepare budgets, financial statements and calculate manufacturing costs. As a mentor, a managerial accountant conducts formal and informal meetings with staff to identify strengths and opportunities for improvement. Leadership skills help senior-level accountants to get everyone working towards a common goal and meet company deadlines.

Coordinating financial operations

CMAs who are senior-level management accountants may ensure all of an organizations financial activities align with its objectives and initiatives. This role can require professionals to communicate goals, spending and budget requirements to other accountants and departments. The financial expenditures of one department affect the availability of funds for other projects, so its important that accountants across the company are all informed of necessary information. A certified management accountant coordinates these activities and makes judicious decisions for the future.

Planning and maintaining organizational budgets

Accountants can use a budget to identify and set limits regarding the amount of money a company may spend and remain in operation. Setting a budget requires research and tracking of all business activities. Expenses and costs associated with operating and producing a profit also influence the amount a business needs to thrive in its market.

Identifying opportunities for investment

In addition to tracking the financial health of a business, managerial accountants look for opportunities for growth. These may include investing in financial opportunities, community activities or bringing in top-level talent. Managerial accountants also have a unique perspective in understanding where the company can cut costs.

Analyzing internal and external risks

Businesses typically encounter risks from both their internal and external environments. Managerial accountants monitor these environments for any indication that a source could impact an organizations financial stability. After an assessment, they make suggestions to stakeholders and executives on how to avoid or mitigate these risks.

Presenting financial assessments to senior management

Senior-level accountants make presentations to senior management to keep them informed on the status of financial activities. They explain the risks and opportunities a business faces and suggest ways to capitalize on them. This helps executives to make plans for the next period and ensure the business is on track to accomplish its long-term goals.

What is a certified management accountant?

A certified management accountant (CMA) is an experienced professional in a managerial accounting role or corporate finance who has earned advanced certification. The Institute of Management Accountants (IMA) issues the CMA certification. The purpose of the certification is to ensure standard practices across the management accountant profession and to validate competency in the industry.

Common roles held by certified management accountants may include:

How long does it take to become a CMA?

Becoming a CMA may take candidates several years, depends on their degree path, industry experience and performance on the certification exam. The minimum education requirement is a relevant bachelors degree, and candidates may earn these credentials in four years depending on whether theyre full-time students or if they enroll part-time. The IMA also requires two years of relevant work experience, so it may take six years for individuals to earn the academic and professional prerequisites for the certification exam. There are programs to prepare individuals for the exam, which may take several months depending on the course and the student.

How do you become a certified management accountant?

To become a certified management accountant, follow these steps:

What is the difference between a CMA and a CPA?

The primary difference between a certified managerial accountant and a certified public accountant is the tasks these professionals handle. A CMA is responsible for planning a companys financial future. Alternatively, a CPA handles current financial tasks such as taxes, accounts receivable, accounts payable and payroll.

How much do certified management accountants typically earn?

Please note that none of the companies mentioned in this article are affiliated with Indeed.

FAQ

What does certified management accountant do?

Management accountants work for public companies, private businesses, and government agencies. Their duties include recording and crunching numbers, helping to choose and manage company investments, risk management, budgeting, planning, strategizing, and decision making.

What is the difference between CMA and CPA?

A CMA (certified management accountant) focuses on identifying business growth strategies based on their comprehensive financial analyses. This stands in contrast to a CPA (certified public accountant), a more general accounting designation that isn’t as involved in management and strategy decisions.

Is Certified Management Accountant worth it?

Employers value the CMA because it shows you can bring future-forward skills like strategic thinking and data analytics to the table. We see many CPAs opting to earn the CMA designation because they want to take their career to the next level.

What is the salary of CMA?

An Entry Level CMA with less than three years of experience earns an average salary of ₹10.2 Lakhs per year. A mid-career CMA with 4-9 years of experience earns an average salary of ₹22 Lakhs per year, while an experienced CMA with 10-20 years of experience earns an average salary of ₹4.7 Lakhs per year.

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