Obtaining your Certified Public Accountant (CPA) license and the Chartered Financial Analyst (CFA) credential can greatly help you throughout your career. Both certifications are prestigious and well respected but will fit people’s needs differently based on their future goals. Diving deeper into what each certification entails and the opportunities afforded by each will hopefully help to create a distinction between the two and which one better aligns with your career path.
The CPA exam is overseen by the AICPA. The exam is comprised of four electronically administered tests, (Audit, Business, Financial Accounting and Reporting, and Regulation) which you can take in any order, throughout the year. Candidates must have a four-year bachelor’s degree as well as 150 qualifying credit hours. The test is difficult to pass and requires a well thought out plan and many hours of study, but the benefits are worth it. Once you pass the exam you must work for a certain amount of time, as determined by your state board. Many CPA’s work for accounting firms, focusing on audit, tax and/or consulting. However, the certification provides ample amount of opportunities across many different industries. CPA’s generally prepare the various different financial statements or are the one’s auditing the financial statements.
The CFA is granted by the CFA Institute, which is a non-profit organization. Candidates must pass three exams, which include topics such as corporate finance, investments, economics, and quantitative methods. Requirements to sit are more lenient than the CPA and include either a bachelor’s degree or four years of relevant work experience. The test is more traditional in the sense that it is taken via pen and paper. The format of the test overall is not as flexible as the CPA exams, as you must pass one test to move on to the next. The Level 1 test is administered twice a year and the Level 2 and 3 tests are only administered once a year. Similar to the CPA, the exams are very difficult and require many hours of study. The certification allows for many different career opportunities, such as portfolio managers for banks, mutual funds, or pension plans. CFA’s spend most of their time analyzing investment and managing portfolios. Contrary to what CPA’s do, CFA’s spend a majority of their time analyzing financial reports.
As mentioned earlier, your future goals and career path will dictate which certification you should pursue. If the investment market interests you and you enjoy analyzing portfolios, obtaining your CFA would be a great option. If you are looking to get into accounting and enjoy interacting with people on a day to day basis, then the CPA certification may be the answer. The CPA consists of one more test, but the CFA can take longer to pass based on the limited amount of times the test is offered. Both certifications require similar amounts of study time and preparation. Additionally, both provide stable jobs with great growth potential, it really just depends what interests you and where you see yourself working in the long run.