Analysis of Finance Designations...Which ones have value?

I had a few minutes before the crop report and after reading how ddrobinett chewed up and spat out the CIMA designation I wanted to know what peoples opinions are on all the other designations out there. Which ones in your opinion have value and which ones don’t? I am quite sure people can come up with few that I am not even familiar with…I will start with my own

CAIA Charterholder…I work a lot in commodities so in that respect it has provided me with the knowledge in this area but has not raised any eyebrows at my employer that I have it. I get some respect from colleagues for having it but from what I have seen so far I doubt it will get me a raise or a promotion

CFA Candidate…just took level one in December and seems well respected by everyone I talk to. It seems to be the pinnacle of Finance designations. Only one person on my entire floor (maybe 200) is a charterholder. Multiple failures exist and a number of people I have spoken to don’t care to continue persuing it. My bosses don’t put a lot pressure for employees to pursue designations, they just feel you can learn everything you need to know internally.

I have heard of FRM, CIMA, CMT, CTP,…clearly know only a few people with these but don’t know if they really hold any real world value.

It has been posted before–I think there are four “premier” designations: CFA, CPA, JD, and MBA (as long as it is from a good school–maybe top 50). These four are difficult enough that they mean something, but also broad enough that you can go in a lot of different directions. (Full disclosure–I have the CPA, MBA, and working on CFA Level 3. Would like to get JD, but refuse to go to Law School.)

I think the CFP is good for those who want to work in retail, or who want to provide comprehensive financial planning. I definitely think that it ranks far behind the “Big 4”, but still has value to it.

I echo ddrobinett’s opinion on CIMA.

I took the CRPC once. I started studying on Thursday afterrnoon, and took the test on Saturday morning. I passed. I got it because it was “highly recommended” for a job I wanted. (Thank God I didn’t get it. Don’t want it anymore.) I let the designation lapse because I didn’t feel like paying $150 and doing CE for a largely worthless designation.

The essense of finance (to me at least) is “investment/portfolio management” and the CFA exams are the most thourough in covering and testing the subject. I would not personally consider someone without it qualified to manage institutional money (or mine), and if a portfolio manager does not have the designation my question would be “why not?”. I value the designation because it sets a minimum level of knowledge every money manager should have and the difficulty of the exam provides some type of barrier to entry. If someone wants to argue that a MBA program is “better” at providing the academic training/background or someone has the experience and track record to prove competancy to manage money, than passing the CFA exams should be an easy token on top of that.

By the way—since I am an accountant, let me give you my take on the various accounting designations out there. (If you are not an accountant nor have any desire to be one, just disregard this post.)

  • CPA – While there may be some discussion about which is better, CFA or MBA, there is no such argument in the accountant ranks. CPA reigns supreme.
  • CMA (Certified Management Accountant) – If you want to work in industry instead of public practice, this is a good alternative. However, CPA will always be Beyonce, and CMA will always be Kelly Rowland.
  • EA (Enrolled Agent) – If you want to be in a tax practice, this is just as good as the CPA. However, you are limited to tax—no auditing or corporate accounting.
  • CIMA (Chartered Institute of Management Accountants) – not to be confused with the Certified Investment Management Analyst. This is a UK/European designation similar to the CMA. Since I live in the US, I don’t know much about it, but it seems to be held in high regard.
  • CIA (Certified Internal Auditor) – This is a good complement to the CPA if you want to be in Internal Audit. Otherwise it’s pretty useless.
  • CFE (Certified Fraud Examiner) – Focused exclusively on detection and prevention of corporate fraud. Like the CIA, it’s a good complement to the CPA, and useful if you’re already doing that job. If you’re not, it’s useless.

Most of these below are used by CPA’s to hype up their resumes, especially to clients. If clients only knew how little work some of these actually took, they would be less impressed.

  • CVA (Certified Valuation Analyst) – This is an “add-on” for CPA’s who also do business valuations. It seems to be “pay us 3,000 dollars and take a one-week course and we’ll give you a designation.” Personally, I am doubtful that it has much value. However, you have to do CE anyway. Might as well get a designation for it! (There’s also the Accredited Valuation Analyst for the non-CPA.)
  • CMAP (Certified Mergers & Acquisitions Professional) – A designation exclusively for the middle-market M&A transactions. Its value is similar to the CVA. It’s even issued by the same people. (There’s also a Certified Mergers & Acquisitions Advisor–a carbon copy.)
  • CGMA/ABV/PFS/CFFE – Whenever another certification begins to gain recognition, the American Institute of Certified Public Accountants comes up with their own designation that is the exact same as the other, more recognized one. These are the AICPA versions of CMA, CVA, CFP, and CFE. (Of course, to use the initials will cost you money. You just don’t have to take the test again.)

I’ve often thought this was funny:

I’m a CPA, and toward the end of becoming a CFA. I’m debating on (in a few years) taking the CFP, because I might do retail financial planning for my tax clients. If I were to complete the CPA, CFA and CFP, I could conceivably finish all the rest of this in a month:

  1. I could probably go into the CIMA blind and pass it. Of course, I would still have to pay 8,000 for the designation.
  2. I could probably take the CRPC and AAMS blind and pass them. (These don’t cost much money.)
  3. I could take the one-week course for the CVA (at the low cost of 3,000 plus airfare and hotel). After I passed the test, I would be a CVA and an ABV.
  4. I could take the one-week course for the CMAP (at the low cost of 3,000 plus airfare and hotel). After I passed the test, I would be a CM&AA, too.


Wow! What a resume!!! Clients who don’t know better would pay me millions!!!

EDIT: I forgot the CBA-Certified Business Appraiser. If I pass the CFA exam, I can pay 600 bucks to get the CBA. No studying and no exams necessary.

Wow! Even though I have no desire to pursue any accounting designations Greeman72 that was good information. Thanks for that. In my opinion wIth the proliferation of online MBAs, this designation seems to be getting watered down. It impacts those pursuing MBAs outside the top 20 schools a lot more. If I decided to go get an MBA from say Baruch is a HR professional really going to differentiate that MBA from the University of Phoenix? At the end of the day pursuing the designations that I have has given me the ability to think differently about a number of issues but in the end, are these designations really going to help you make more money unless they are deemed absolutely necessary by your employer?

Also someone just sent me a promotional email and their designations were MCSE, MCP and CCA…can anyone elaborate on these?

Even though I know many will disagree with me, I think being in the top 50 is good. Florida, Penn State, and Texas A&M are really good MBA programs, but they’re not in the top 20. An MBA from Texas A&M is different from an MBA from Texas A&M-Corpus Christi.

I don’t know what Baruch is. But I think certain schools have a niche for certain majors. University of Texas-Austin has the best Accounting program in the nation,and also a world-class extension on petroleum mining and engineering. So if you need somebody to do corporate finance for an oil and gas company, I would start looking at the University of Texas. Cornell has the best school in the world for hotel managment and tourism. Michigan has a good a finance school as anybody.

Well, like I said: as a CPA in public practice, it’s not about whether they are necessary, but whether the clients think I’m smarter for having them. Who would you rather take your business to–a guy who only has one designation in financial Analysis? Or a guy who’s a Certified Public Accountant, has FOUR certifications in Personal Financial Planning, TWO certifications in Business Valuation, and TWO certifications in Mergers and Acquisitions?

If you didn’t know better, you’d take the latter, because ten certifications are better than one, right? Now, I believe that the CFA is probably harder than all the others put together, but clients don’t know that. And they’d probably be willing to pay the second guy more.

Now, if you want to go to work for a firm where the bosses know better, that’s a different story. If you go tell a portfolio manager at UBS’s private bank, “I have the AAMS. It’s about the same as the CFA”, you’ll get laughed out of the interview room (assuming you’re even granted an interview).

the thing about MBA programs outside the the top 10-20-50, is that they are more relevant to local markets. Not everyone wants to work/live in NYC/Chicago/SF…

if you are from some random city/state the local state school MBA program will offer great connections in that market… but dont expect to be heading to London to work for GS.

I live in NYC so I used Baruch as a random example…it is a state school (relatively cheap) and ranked #97 overall by the last U.S. News and World Report. So I guess you have to do some real world planning prior to applying for and wasting money on an MBA…outside the top 20 (or 50) don’t expect to work in London, Chicago or Singapore…

DVictr is right. The University of Texas is an outstanding, elite, well-respected school–in Texas (and the southwest in general). Harvard is an outstanding, elite, well-respected school everywhere.

If you want to work in Dallas, Austin, Houston, or San Antonio, go to University of Texas. It will probably earn you about the same pay (and better ROI) as Harvard.

If you want to work in NYC or London or Hong Kong, go to Harvard.

Haha, I would love to see some sort of regulation on these peripheral designation like the AAMS, CRPC, etc. They are complete fraud. I saw one guy on linked that I went to undergrad with who worked for the esteemed firm Ameriprise that had like 5 of these designations behind his name, but basically all of them could easily be summed up in the CFP. In fact, I think the AAMS is basically the investment portion of the CFP education requirement before you can take the CFP exam and the CRPC is basically the retirement portion. I actually sent him a message asking about why he had the alphabet soup and he told me his clients really value his designations and “wealth of knowledge” in the various financial planning areas. These are designations are scamming people in to believing they have an educated “expert” working for them. I could see 60 minutes doing a whole exposé episode on this.

To me, the CFA or an MBA from a top 20 school are the premier designations/degrees in Finance and of course the CPA for accounting. These are valuable not only for the depth of knowledge gained but also because people know instantly that you have a certain level of competency.

Everyone says the CFA doesn’t have the same network as an MBA, but I beg to differ. In my city, the local society has lunches every two weeks and if you become actively involved, people will know your name and know what you do. I think the networking opps for and MBA begin to fade after several years.


But does the local CFA program have a football team and a homecoming game? Do you wear your CFA ring with pride? Do you bleed “CFA blue and white”?

Of course, I guess these are more associated with a undergrad program, but still…

I work in financial planning, young, and got the CRPC designation b/c I feel in this profession that it is better than nothing. I understand it isn’t highly respected nor did I expect it to be very difficult and highly esteemed. I did it purely as a start to continue further education. Also, the firm paid every dollar for it so why not?

I have since started the CFA for what I truely want to achieve. I think everyone has different views and most defnitely agree that there are 2 or 3 tiers of designations.

Yeah, I’d be embarressed for anyone in an MBA program that was bleeding school pride and rooting on their football team. That is for kids in undergrad. When you’re in an MBA program, the only thing you should be concerned with is your future.

I did the same thing and got the AAMS right after I passed the Series 7 when I worked for a regional brokerage firm. You are right, it is better than nothing and to be honest it was the start to what made me want to pursue the charter and grad school. There is no harm in doing it, but many retail clients are duped by people holding themselves out to be advisors and professionals when in reality they are sales people trying to make a commission. Again nothing wrong with that either, just don’t say you’re one thing and do another.

I agree completely. That designation also lead me to begin my studies on the CFA.

I have a similar story. And I agree–if your company is willing to pay for it, and it costs almost nothing in “time and stress costs”, then go for it. But don’t hold it out there like it’s “the equivalent of a Master’s degree”, which is what Ameriprise told me to tell clients when all I had was a 7/65.

HAHAHAHAHAHAHA!!! That’s where I started!

That company is a joke and a farce.

^ Do tell. What happened?