In this article we compare and contrast the pros and cons of doing a CPA versus a CFA.
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CPA vs CFA, which one is better for me?
When considering a career in corporate finance or the capital markets you will often hear people asking, “Should I get a CPA or CFA?” and “Which is better?”. In this article, we will outline the similarities and differences of the CPA vs CFA designations and try to steer you in the right direction about which is the right fit for you. One is not better than the other – it just comes down to your personal career objectives.
What is the Certified Public Accountant (CPA) designation?
Certified Public Accountant (CPA) is the designation of legally qualified accountants in many countries around the world. In the US, the designation is administered by the Uniform Certified Public Accountant Examination and requires additional education and work experience in order to obtain the designation.
In countries outside the U.S., the accounting designations of anequivalent standard include Chartered Accountant (CA), Chartered Certified Accountant (ACCA), Chartered Professional Accountant (CPA), Certified Public Accountant (CPA), Certified PracticingAccountant (CPA), and Certified Management Accountant (CMA).
What are the most common CPA career paths?
The most common career paths for CPA include:
- Public Accounting (audit, tax, advisory, valuation)
- Corporate Accounting (accounting, reporting, finance, treasury)
- Government / Academics / Non-Profit
CPAs have many career paths available to them. Within the first category, public accounting, there are many different types and sizes of firms, with a variety of different client types. Within a given firm, there may also be many options, such as audit, tax and advisory services, or consulting. On the business and industry side, there are also a wide range of companies and options within them, such as financial accounting and reporting, financial planning and analysis, management accounting, treasury or cash management, and corporate development.
Given that at CFI we are focused on corporate finance, we focus on more of the top career paths for CPAs within corporate accounting. Below is an example career path for CPA on the corporate side:
- Staff Accounting (1-3 years)
- Senior Accounting (3-6 years)
- Accounting Manager (6+ years)
- Assistant Controller(8+ years)
- Controller(10+ years)
- Chief Financial Officer (CFO)(12+ years)
What is the Chartered Financial Analyst® (CFA®) designation?
The Chartered Financial Analyst® designation is offered internationally by the CFA Institute and focuses on financial analysis, with a heavy component of portfolio management. In order to obtain the designation, a candidate must pass all three levels and meet career experience requirements. As of June 2016, there were approximately132,000 charterholdersglobally.
What are the most common career paths for charterholders?
According to the CFA Society, the top employers of CFA charterholders are UBS, JP Morgan, Citigroup, Morgan Stanley, BlackRock, HSBC, Credit Suisse, BoAML, Barclays, and Deutsche Bank. The most common career paths for charterholders include:
- Investment management
- Equity research
- Corporate finance
- Risk management
- Investment banking
- Sales and trading
The program focuses on investment management, so it’s no surprise to see that as the top career path on the list above. From there it branches out into a wide range of corporate finance roles, mostly on the banking side. The top employers are mostly banks, and the charterholders fit into a wide range of roles within them. Click here for a breakdown of typical compensation for a charterholder.
CPA vs CFA – Which designation is right for me?
It’s entirely subjective. Both offer excellent career paths, so it’s important to know which one is a better fit for you. The CPA is great if you want to rise up the finance department at a corporate business and ultimately become the CFO, or if you want to rise up the ranks at a public accounting firm. The CFA credential, by contrast, is great if you want to work at a bank and, in particular, in investment management or equity research. Both offer good opportunities for people looking to break into corporate finance.
Compare more designations
Below is a summary table for helpful reference to easily compare several career paths for financial analysts.
| CFA | CPA | FMVA | CAIA | CFP | FRM |
|---|
| Number of Levels | 3 | 1 | 1 | 2 | 2 | 2 |
| Costs | $2,550 to $3,450 | $1,000 to $3,000 | $497 | $3,000 | $2,000 | $1,500 |
| Exam Pass Rate | 30-50% | 40-50% | 70% | 70% | 67% | 40-50% |
| Content Focus | Portfolio Management, Investments | Financial Reporting, Audit | Financial Modeling, Valuation | Real Assets, Alternative Investments | Financial Planning | Financial Risk Management |
| Career Application | All Encompassing | Accounting and Finance | All Encompassing | Asset Management | Retail and Wealth Management | Risk Management |
| Study Time (hrs) | 300-350 per exam | Varies | 120-200 total | 200 per exam | Varies | 200-300 per exam |
| Completion Time | 3-5 years | 2.5 - 5 years | <1 year | 1-2 years | 4 years | <1 year |
| Work Experience | 4 years | 1 year | None | 1 year | 3 years | 2 years |
Additional resources
Thanks for reading CFI’s guide on the CPA vs CFA credential. To keep learning and advancing your career, check out these additional resources:
FAQs
CFA vs CPA Exam difficulty
Both are challenging and require gaining skills and knowledge in complex topics. However, the CPA Exam generally requires less studying - around 80 to 120 hours per section compared to 300 hours per section of the CFA Exam, and the CPA Exam also has a higher pass rate.
Is CPA more valuable than CFA? ›
The CPA is great if you want to rise up the finance department at a corporate business and ultimately become the CFO, or if you want to rise up the ranks at a public accounting firm. The CFA credential, by contrast, is great if you want to work at a bank and, in particular, in investment management or equity research.
Should you answer every question on the CPA exam? ›
You don't lose points for answering incorrectly. You only get no points. Therefore, you should ensure you always answer every question within a testlet before moving on. If you leave questions blank, you'll be certain to remain on the “medium” track, which will hurt your score.
How hard is the CPA exam compared to other exams? ›
The CPA Exam. You've heard the horror stories: It's derailed the careers of promising professionals. It's definitely harder than the BAR exam and maybe even some medical board exams. And it's nearly impossible to pass once you're a working professional.
What pays more CPA or CFA? ›
CFA vs CPA Salary: Everything You Need to Know. The average salary for a CFA charterholder ranges anywhere from $51,000 to over $274,000, while CPAs may earn an annual salary ranging from $50,000 to upwards of $240,000.
Is the CPA the hardest exam in the world? ›
Certified Public Accountant (CPA)
The CPA Exam is widely regarded as one of the toughest professional exams, and it covers a wide range of topics, including auditing and attestation, financial accounting and reporting, regulation, and business environment and concepts.
What is the salary of CFA in USA? ›
CFA Salary in USA depends on the work experience and job roles. The average salary of a Chartered Financial Analyst is USD 108,855 per year (INR 90.63 Lakhs Approx). This is just base pay and does not include other benefits of total compensation.
Is the CFA harder than the bar? ›
With a pass rate of less than 11% for all three levels, the CFA passage rate is lower than most state bar exams. Virtually everyone who has taken all three exam levels will tell you it is one of the most time intensive and difficult exams they have ever sat for.
What kind of CPA makes the most money? ›
Average annual salary for highest-earning accounting jobs
| Job Title | Average Annual Salary |
|---|
| Chief Compliance Officer (CCO) | $181,750 |
| Treasurer | $199,750 |
| Vice President of Finance | $192,750 |
| Corporate Controller | $188,250 |
2 more rowsThe CPA Exam is scored on a scale from 0 to 99, and you must score a minimum of 75 to pass each section. However, the score is not based on a percentage of correct answers. Your score calculation is based not only on whether you answered questions correctly, but also on the relative difficulty of each question.
The overall pass rate of the CPA Exam hovers around 50%, but how many people manage to pass all four sections—including three core and one discipline—on the first try? About 20%. Around 1 in 2 people will pass a specific section of the exam, and about 1 in 5 people will pass each section on their first try.
How many times can I fail the CPA? ›
There is no limit as to the number of times you may repeat a failed section. You may take any unpassed section of the CPA Exam year-round.
Is CFA harder than CPA? ›
As clearly seen in the passing rates CFA is more difficult in comparison to CPA. On an average about 50% of the registered candidates clear CPA exam whereas about 7% of the candidates clear all the 3 levels of CFA. In terms of course also, the course of CFA is much more lengthy and detailed in comparison to CPA.
Which is harder, MBA or CPA? ›
An MBA can be harder depending on the program, but usually entails completing coursework in areas such as marketing, management, and financial analysis. Moreover, it takes approximately 1,000 hours to become a CPA, while an MBA usually takes two years to complete.
What's the hardest licensing exam? ›
1. The United States Medical Licensing Examination (USMLE) The United States Medical Licensing Examination (USMLE) takes the top spot as the most challenging exam in the US, with an average preparation time ranging from 200 to 400 hours for each of its three steps.
What professional exam is the hardest? ›
- The United States Medical Licensing Examination (USMLE) ...
- The Uniform Bar Examination (UBE) ...
- The Uniform Certified Public Accountant (CPA) Exam. ...
- The Chartered Financial Analyst (CFA) Exam. ...
- Graduate Record Examination (GRE) ...
- National Council Licensure Examination (NCLEX)
If the comparison is made among CPA vs CMA vs CFA for the time duration taken to clear the exam, the CFA Program takes the longest to complete and can, therefore, be considered the hardest.
Is CFP harder than CPA? ›
Comparatively, CFP is easier than CPA. The historical pass rate has been above 60%, which indicates that the tests are of a difficulty level that is considered to be moderate. Within the testing period from October 31 to November 7, a grand total of 3,386 individuals sat for the CFP® Certification Exam.
How difficult is the CFA really? ›
The Bottom Line
Overall, the CFA exams are very difficult, but candidates can increase their chances of passing by studying for over 300 hours, utilizing alternative prep materials, answering as many practice questions as possible, and creating a structured study plan.
