AICPA, CIMA stakes claim to a global management accounting certification

One of the big reasons for merging Canada’s accounting professions is the global competition nipping at their (our?) heels. One such challenger, as highlighted in the current CA Magazine, is the Chartered Global Management Accountant certification, a product of the American Institute of Certified Public Accountants (AICPA) and Chartered Institute of Management Accountants (CIMA).

Cue Patrick Bateman: “Look at that subtle off-white coloring; the tasteful thickness of it… Oh my god, it even has a charter.”

I’m not sure why I should be worried about a brand new certification with no history and nascent prestige (to be charitable), but, … uh… hey, free magazine!

Accepting the argument that we need to meet this threat head-on by joining forces with our brethren, this might lead some to believe CMAs would be assuming the front lines in this battle, given their pedigree with management accounting. If we take these upstarts to be our challengers, this will no doubt impact the development of the merged curriculum and other requirements.

CA Magazine’s done some recon:

The hallmark of the CGMA designation is expertise in applying nonfinancial, qualitative information along with financial analysis to understand all aspects of business. According to a study done by the two institutes, this will be in increasing demand by international businesses that want integrated financial and nonfinancial information.

I think what they mean here is expertise is applying non-financial and/or qualitative information. As we all know, there are many important metrics in all businesses which are non-financial, but still quantitative. I think they’re taking that from this page which compares and contrasts financial accounting and the added value of management accounting. Where the former is concerned with the financial, the latter adds non-financial. Where the former focuses on quants, the latter includes qualitative information. (Conclusion: It’s all marketing!)

One thing is for certain, according to the pro-merger forces among us: War is coming.

(Yeah that’s right, I started this with an American Psycho reference and I’m ending it with a Game of Thrones reference. What of it?)


Thoughts on the proposed accounting profession merger

The country’s professional accounting bodies regulating the use of Chartered Accountant, Certified Management Accountant and Certified General Accountant designations are currently deep into merger talks, as you might have heard.

This affects me, of course, but I have a very pliable opinion on the merits of this path. Ultimately I’ve earned the CA designation by passing the UFE in 2006 and meeting the experience requirement in 2008, and nothing will change that whether the letters are CA, CPA (the proposal) or WTF.

The proposal is that the three bodies will merge their operations and we’ll all become CPAs, short for Chartered Professional Accountant, which of course is different from the USA’s Certified Public Accountant, but apparently deliberately identical to both confuse people and prevent incursion by that entity into Canada in the future. For the first 10 years we’ll be allowed to use both the new designation and the old one in tandem. I’d become Neil McIntyre, CPA, CA (woo hoo, free credential!) After 10 years we’d be forced to drop our old letters and use only the CPA.

CAs opposed to the change feel like the traditionally strictest requirements associated with an accounting designation in Canada will be watered down when they are combined with the other two. It’s a valid concern, certainly, but not a deal-breaker in my opinion. It’s not like in 10 years time everyone is going to forget that there are thousands of accredited accountants in the country that qualified under differing regimes. I can foresee a job interview involving a wink, nudge and a question about which regime exactly it was.

I truly do believe that the process to reconcile and merge the qualification process can be done well enough to satisfy all stakeholders. I’d personally like to see some form of the case-based exams from the UFE included, as I think they’re a good challenge and better than other forms of testing (e.g. multiple choice). And I don’t think the combined designation will carry less weight than the CA alone. Anecdotally, when I worked in public accounting, I knew someone who had a ton of trouble with the UFE, but in all other respects was a fantastic accountant and auditor, and would’ve made a great CA. He just couldn’t crack the exam. I don’t know whether it was the pressure or whether he didn’t test well generally or specifically with the case format. Conversely, there are some people who have no trouble with it and then have their designations revoked for incompetence or lack of ethics.

I find it interesting that one of the purported benefits of the merger is to reduce administrative costs. The parties point out that having three competing groups, each with provincial fiefdoms results in 40 different bodies, which can be reduced to 13 with the merger. If any were really concerned about the administrative costs they would’ve eliminated the provincial bodies already. (All three are likely proponents of a national securities regulator!)

I didn’t set out to write a post in favour of the merger, because as I noted earlier my interest in the debate is minimal. But I may have just solidified my support in the process of writing it.