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How to Meet the CMA Exam Requirements؟

As the administrator of the Certified Management Accountant (CMA) certification, the Institute of Management Accountants (IMA) holds high standards for CMA candidates. And to enforce these standards, the IMA has established the Certified Management Accountant requirements (or CMA requirements), some of which also serve as the CMA exam requirements.

Compared to those of other professional accounting certifications (such as the CPA), the CMA requirements are fairly straightforward and simple. However, they do require time and effort to complete. Furthermore, you must finish some of the CMA qualifications before others. Therefore, you should learn about the CMA certification requirements and the CMA exam requirements before you start the process of pursuing the CMA.

To earn the CMA certification, you must fulfill these 7 CMA requirements in this order:

Hold active membership with the IMA
Pay the CMA entrance fee
Fulfill the education qualification
Pass both parts of the CMA exam
Fulfill the experience qualification
Comply with the IMA Statement of Ethical Professional Practice
Complete the annual CPE requirements
As you can see, some of these requirements are more involved than others. For example, paying the CMA entrance fee, and complying with the statement are pretty quick and easy steps.

However, meeting the education requirement, completing the experience requirement, and passing the CMA exam demand much more concentration and commitment. Therefore, many CMA candidates focus the most on the 3 requirements that start with an e: education, exam, and experience.

Addressing the CMA Requirements in Order
To properly satisfy each CMA requirement, you must address them in the right order.

1. Become an IMA member and pay the CMA fees
The very first step to earning the CMA is becoming an IMA member, which involves filling out a short application and paying a fee. The type of IMA membership you’ll hold and the price you’ll pay for it depends on your current professional status. Your IMA membership type and fee options are as follows:

Professional: $245
Academic: $135
Student: $39
The next step in the CMA certification process is paying the CMA entrance fee. You must pay this fee in order to enter the CMA program and take the CMA exam. And the price of this fee depends on your IMA membership type. Professional IMA members must pay $250, while Academic and Student members have to pay $188.

Once you enter the CMA program, you have 3 years from the date of entry to pass the CMA exam. If you don’t pass both CMA exam parts within 3 years, you will lose credit for any parts you passed, and you’ll have to pay the CMA entrance fee again.

The CMA Handbook provided by the IMA states that, along with access to the CMA exam, the CMA entrance fee also includes:

Access to the CMA Support Package beginning on the date of entry into the CMA program
Performance feedback reports
Review of educational and experience credentials
Final score report upon completion of the exams
Personalized, numbered certificate upon completion of all requirements
Employer notification of achievement if desired
Maintenance of a listing of all CMAs in good standing on the IMA website for employer verification of status
2. Meet the CMA exam requirements
The CMA exam requirements include:

Completing the education qualification
Passing the CMA exam
You can take the CMA exam before you complete the education requirement, as the IMA accepts student members and offers them discounts on CMA exam fees. However, you must submit verification of your education to the ICMA within 7 years of passing the CMA exam.

CMA Education Requirement
CMA candidates can satisfy the education requirement in 1 of 2 ways:

Earn a bachelor’s degree from an accredited college or university
You’ll find a partial list of accredited U.S. and international institutions here: http://univ.cc/world.php.
If you received your degree from a non-accredited institution, an independent agency must evaluate your education. You’ll find a list of such agencies at aice-eval.org or http://www.naces.org/members.htm.
If you can’t find your college or university on the accredited listing, you can contact the IMA at ima@imanet.org.
The IMA clarifies that verification of a bachelor’s degree means all transcripts should be mailed directly from your college or university to the address below.
If you cannot submit your transcripts, the Institute of Certified Management Accountants (ICMA) asks that you mail them a notarized copy.
Have a professional certification
The IMA has a list of approved professional certifications.
The IMA elucidates that verification of a professional certification means the approved certifying organization should mail a letter confirming that you are a qualified member directly to the address below.
All of your education verification must be submitted in English, and you must include your IMA member number. The address to which transcripts an

 

the topics of each CMA Part 1 content area.

A. External Financial Reporting Decisions

1. Financial statements
   • a. Balance sheet
   • b. Income statement
   • c. Statement of changes in equity
   • d. Statement of cash flows
   • e. Integrated reporting
2. Recognition, measurement, valuation, and disclosure
   • a. Asset valuation
   • b. Valuation of liabilities
   • c. Equity transactions
   • d. Revenue recognition
   • e. Income measurement
   • f. Major differences between U.S. GAAP and IFRS

In this section, you’ll be required to know the items in these documents and how they relate to each other:

• A balance sheet
• An income statement
• A statement of changes in equity
• A statement of cash flows

If you have studied any accounting before, this should be a relatively straightforward section, and most of these questions should be computational.

B. Planning, Budgeting, and Forecasting

1. Strategic planning
   • a. Analysis of external and internal factors affecting strategy
   • b. Long-term mission and goals
   • c. Alignment of tactics with long-term strategic goals
   • d. Strategic planning models and analytical techniques
   • e. Characteristics of a successful strategic planning process
2. Budgeting concepts
   • a. Operations and performance goals
   • b. Characteristics of a successful budget process
   • c. Resource allocation
   • d. Other budgeting concepts
3. Forecasting techniques
   • a. Regression analysis
   • b. Learning curve analysis
   • c. Expected value
4. Budgeting methodologies
   • a. Annual business plans (master budgets)
   • b. Project budgeting
   • c. Activity-based budgeting
   • d. Zero-based budgeting
   • e. Continuous (rolling) budgets
   • f. Flexible budgeting
5. Annual profit plan and supporting schedules
   • a. Operational budgets
   • b. Financial budgets
   • c. Capital budgets
6. Top-level planning and analysis
   • a. Pro forma income
   • b. Financial statement projections
   • c. Cash flow projections

Budgeting is the biggest section of Part 1. You’ll be expected to calculate various items such as the cost of goods sold, cost of goods manufactured, and other items in the budget. You’ll also see some conceptual questions such as the definition of budgeting. The coverage of section B is more in-depth than that of section A. The concepts are not difficult, but questions can get lengthy and complex in some budgeting scenarios.

C. Performance Management

1. Cost and variance measures
   • a. Comparison of actual to planned results
   • b. Use of flexible budgets to analyze performance
   • c. Management by exception
   • d. Use of standard cost systems
   • e. Analysis of variation from standard cost expectations
2. Responsibility centers and reporting segments
   • a. Types of responsibility centers
   • b. Transfer pricing
   • c. Reporting of organizational segments
3. Performance measures
   • a. Product profitability analysis
   • b. Business unit profitability analysis
   • c. Customer profitability analysis
   • d. Return on investment
   • e. Residual income
   • f. Investment base issues
   • g. Key performance indicators (KPIs)
   • h. Balanced scorecard

In this section, candidates are tested on the ways performance is evaluated in a corporation. Most of the evaluation tools should be familiar to those who work in the accounting department of a corporation. There are certain elements, such as standard costs, that are used mostly in manufacturing companies as opposed to service-oriented companies. If you are working in a financial institution or other service companies, you may want to spend more time understanding the standard cost concept.

D. Cost Management

1. Measurement concepts
   • a. Cost behavior and cost objects
   • b. Actual and normal costs
   • c. Standard costs
   • d. Absorption (full) costing
   • e. Variable (direct) costing
   • f. Joint and by-product costing
2. Costing systems
   • a. Job order costing
   • b. Process costing
   • c. Activity-based costing
   • d. Life-cycle costing
3. Overhead costs
   • a. Fixed and variable overhead expenses
   • b. Plant-wide vs. departmental overhead
   • c. Determination of allocation base
   • d. Allocation of service department costs
4. Supply chain management
   • a. Lean resource management techniques
   • b. Enterprise resource planning (ERP)
   • c. Theory of Constraints
   • d. Capacity management and analysis
5. Business process improvement
   • a. Value chain analysis
   • b. Value-added concepts
   • c. Process analysis, redesign, and standardization
   • d. Activity-based management
   • e. Continuous improvement concepts
   • f. Best practice analysis
   • g. Cost of quality analysis
   • h. Efficient accounting processes

The focus of this section includes the various costing methodologies, and you are expected to be able to complete a full set of calculations.

E. Internal Controls

1. Governance, risk, and compliance
   • a. Internal control structure and management philosophy
   • b. Internal control policies for safeguarding and assurance
   • c. Internal control risk
   • d. Corporate governance
   • e. External audit requirements
2. System controls and security measures
   • a. General accounting system controls
   • b. Application and transaction controls
   • c. Network controls
   • d. Backup controls
   • e. Business continuity planning

The internal control questions in this section are almost all conceptual. They are not difficult to understand, but they can be ambiguous. Picking the best answer can be pretty hard when a few of the answers seem to be somewhat correct. Don’t’ get frustrated if you breeze through this section but discover that you do poorly on the practice questions. It happened to me back then, but things started to click after I stayed focused and reworked the tough questions that I got wrong.

F. Technology and Analytics

1. Information systems
   • a. Accounting information systems
   • b. Enterprise resource planning systems
   • c. Enterprise performance management systems
2. Data governance
   • a. Data policies and procedures
   • b. Life cycle of data
   • c. Controls against security breaches
3. Technology-enabled finance transformation
   • a. System development life cycle
   • b. Process automation
   • c. Innovative applications
4. Data analytics
   • a. Business intelligence
   • b. Data mining
   • c. Analytic tools
   • d. Data visualization

This section of Part 1 is new, so we have yet to develop a strategy for it. However, as with the other areas of the CMA exam, you may be able to use life experience as the foundation for your knowledge. Yet, you should still study the concepts in your CMA review course to ensure that your knowledge is deep. You don’t want to underestimate any part of the CMA exam.

 

The Institute of Management Accountants, abbreviated as the IMA, is a volunteer member association that is focused on meeting the needs of management accounting professionals. The IMA was founded in 1919 and states that its mission is to “provide a forum for research, practice development, education, knowledge sharing, and the advocacy of the highest ethical and best business practices in management accounting and finance.” So, what does all that mean?

In short, the IMA sets the ethical and professional standards for CMAs and maintains an investigative and discipline system to enforce these ethics requirements. If you want to become a CMA, you need to follow their initial requirements for entry. You will also need to maintain their standards and educational requirements to keep your CMA over time.