The recent “CMA: Get Informed, Get Inspired” pre-Conference session during IMA’s Accounting & Finance Conference in June covered some important ground for CMA® (Certified Management Accountant) candidates.
The session featured three managers of strategic partnerships at IMA® (Institute of Management Accountants) – Mitra Kleinberg, Randall Kurtz, and Matt Workman – along with panelists Grace Chan, CMA, principal at BP Ventures; and Sarah Reith, CMA, manager, capital markets and investments at IBM. Both Chan and Reith are newly minted CMAs and offered their insights to help candidates in their quest to earn their certification.
The presentation began with a discussion about the evolution of the finance function: one that is moving from backward-looking responsibilities that are siloed and “descriptive” and into more business partnering roles and, ultimately, to the role of a strategic enabler, able to transform finance productivity and use applied technology. “The content of the CMA is well-aligned to help accounting and finance professionals succeed in this environment – to help them support the creation of value, rather than simply measuring it,” noted Kleinberg.
The session also featured a discussion of sample questions that were adapted from actual retired CMA exam questions:
The questions began with Part 1, Section B, on the topic of Planning, Budgeting and Forecasting, as follows:
Strategic planning, as practiced by most modern organizations, includes all of the following except:
- Top-level management
- A long-term focus
- Strategies that will help in achieving long-range goals
- Analysis of the current month’s actual variances from budget
Noting that the correct answer was D, Kurtz discussed how Section B is the largest unit in Part 1, accounting for 30% of Part 1. In this section, candidates will be tested on strategic planning, budgeting, forecasting, profit planning, and top-level planning and analysis.
Explained Kurtz, “For computations in this section, candidates should be able to prepare all of the various budgets found in the master budget, such as the sales budget, production budget, direct labor budget, etc., as well as the capital and financial budgets.”
Also covered was a question from Part 2, Section C, on Decision Analysis, as follows:
In a make-versus-buy decision, the relevant costs include variable manufacturing costs as well as:
- Factory management costs
- General office costs
- Avoidable fixed costs
- Depreciation costs
Before explaining that the correct answer is C, Kurtz noted, “Decision analysis is a very important section on the CMA exam. It includes cost-volume-profit analysis, marginal analysis, and pricing. Short-term decisions included in this section include special orders, make or buy, sell or process further, and adding or dropping segment scenarios. These are all simplified versions of real-world decisions that businesses are making all the time.”
The session concluded with a panel discussion with Chan and Reith. They discussed their experience taking the exam and fielded attendee questions. They both mentioned the importance of developing a study routine and not deviating from it. While the CMA program requires a significant time investment, Chan and Reith stressed how keeping their study commitments and earning their certifications has rewarded them with a better understanding of their businesses and more opportunities within their respective organizations.
For more information about preparing for the CMA exam, please visit CMA certification.