CFA vs MBA for Accountants (Expert Guide)
We covered the differences between a CFA and MBA qualification in a recent post when we analyzed what might be a better additional curriculum for engineers.
The need for additional qualifications has ever so increased over the past few years. The reasons are pretty straightforward as additional qualifications open up career doors and avenues into other industries. This opens up flexibility in your overall career planning and gives you options for when you are ready to jump into another industry.
Here we analyze whether a CFA or MBA would be better suited for accountants in general.
Accountancy, while popular, leaves you pretty much only a choice to work for one of the top accounting firms such as the big 4 (Deloitte, Ernst & Young (EY), KPMG, and PricewaterhouseCoopers (PwC)) or at a corporate.
A CFA or MBA degree opens the door to use your accountancy skills and venture into financial jobs or into higher management positions where an MBA degree would come in very useful.
Is CFA worth it for accounting?
The CFA is a globally recognized financial analysis designation that is well-respected by employers in the finance industry. The three-stage exam covers a broad range of topics in financial analysis, including investment analysis and portfolio management.
The CFA program registration fee is $950 for the first exam and $450 for each subsequent exam. The exam administration fee is $650 for the first exam and $325 for each subsequent exam. And once you have earned the right to showcase your designation on your CV and business card it will cost you $350 a year.
To get your CFA certification in the shortest time possible, you will need to follow a rigorous study schedule. Allocate at least 300 hours of study for each level of the CFA exam. If you want to complete the CFA program, it is recommended that you will have to study for at least 10 hours per week.
While CFA covers accounting principles many accountants would have already covered in much detail while obtaining their CPA, the CFA designation will bring broader knowledge around the areas of investment management and finance in general.
With the CFA charter holder title you will be in line to compete for general finance roles should you want to enter those areas. In addition, a CFA will also propel you to climb the career ladder internally as you will be not only an expert in accounting practices but also have a very rounded knowledge of finance matters at hand.
Is CFA easy for accountants?
Having done the CFA exams myself, the accounting parts were actually the more difficult elements. But that also makes sense as I studied finance at university.
Accounting is indeed a prominent element, especially in Level 1 and Level 2 exams where you will have to demonstrate deep knowledge of accounting practices. Having done the exam with a few colleagues it would indeed seem that accounting is where most fail in passing their exams. As such, being an accountant should give you a great advantage in passing the CFA exams.
Is MBA tougher than CFA?
Having done both I would say that they are equally difficult to complete. The key difference for me was that the CFA charter exam was more about knowledge “cramming” rather than studying certain aspects of business and management.
From a purely time perspective the CFA was more challenging for me which was mainly due to the fact that I was working full-time. In addition, the necessary speed to answer the exam questions in two gruelling 3-hour exams was quite different when compared to the MBA exams which had hardly any multiple choice questions.
Looking back at my CFA exam we were only allowed to use the Hewlett Packard HP 12C, which at that time in 2003 only had the reverse polish input system. This alone took a few weeks to get used to. A funny yet almost tragic thing happened to me when sitting for my Level 1 exam. I somehow put decimal places to zero and didn’t know how to reverse it. I almost panicked. 2 divided by 3 gave me a 1. It took me 30 minutes to figure out how to undo it. I passed the exam still. The MBA exam was comparatively less stressful.
What pays more CPA or CFA?
According to Payscale a CFA designation typically pays you more than a CPA. This is probably due to the fact that more CFA charter holders are employed in the financial industry which generally pays higher salaries and bonuses.
CFA-certified professionals can expect a base salary of $98,000 per year whereas CPAs typically have an average base salary of $70,800 per year which is quite a bit lower. The variability over someone’s career, however, can vary significantly. In addition, job security and stress levels are also something to take into consideration when setting yourself up on your career path.
Is CFA harder than CPA?
Both qualifications require quite extensive time commitments. Both the CFA and the CPA will take a good few years to complete. While there is no strict time limit for the CFA (yearly or half-yearly exams) the CPA needs to be completed within 18 months.
The CFA has 3 levels broken down into two 3-hour exams at each level. Meanwhile, the CPA designation will have to be completed in 4 modules (Auditing and Attestation, Regulation, Business Environment & Concepts and Financial Accounting and Reporting). This will be a 16-hour total.
Both exams are quite tough with pass rates ranging around the 50% mark. So study hard if you want to pass!
Does CFA count towards CPA?
To gain the entry requirement to complete a CPA you will need to hold a bachelor’s degree as well as educational qualifications. It is widely accepted that aspiring CPAs need to earn 150 credits — or about 30 credits beyond a typical bachelor’s program.
In order to get here many following this path earn a master’s in accounting. Some schools offer that award both a bachelor’s and a master’s degree in accounting.
A CFA degree will unfortunately not count towards any credits or qualifications for the CPA.
Conclusion
A CFA or MBA degree opens the door to use your accountancy skills and venture into financial jobs or into higher management positions where an MBA degree would come in very useful.
The CFA is a globally recognized financial analysis designation that is well-respected by employers in the finance industry. The three-stage exam covers a broad range of topics in financial analysis, including investment analysis and portfolio management.
Having done both I would say that they are equally difficult to complete. The key difference for me was that the CFA charter exam was more about knowledge “cramming” rather than studying certain aspects of business and management.
CFA-certified professionals can expect a base salary of $98,000 per year whereas CPAs typically have an average base salary of $70,800 per year which is quite a bit lower.
