I was an Accounting and Information Systems major in undergrad and went into public accounting because the opportunity was there. I’ve since done the CPA and CISA just to reaffirm that while auditing is a great place to learn business, it is a only job, not a career for me. I decided to get an MBA and in the process realized I loved Finance, I’m actually finishing up an MBA with a concentration in Finance this fall. I’m now seriously considering the CFA. My firm has already agreed to pay for it along with a review course, so cost isn’t the issue. I want to know how useful the CFA is in corporate finance? I want jump to a financial analyst position, my firm does a lot of private equity and M&A work and I know there are opportunities for me if I decide to do this. I also know that the hours involved in this line of work are often grueling and not sustainable once I settle and have a family. How viable is a career path from analyst to corporate finance to CFO? How would the CFA benefit me on this path?
Speaking as a young guy (so take it with a grain of salt), I think the CFA is a useful learning tool no matter what direction in the financial world you want to take, from investment banking to tax accounting; however, as the son of a CFO, it is my understanding that the CFA is a rather useless credential on the corporate executive accounting side of the business. The duties of a Chief Financial Officer in no way resemble the duties of an investment analyst. I’m sure there are CFOs with the CFA charter, but I highly doubt it was the key to them getting there. The CPA (and now the MBA as well) is the key to getting a job as a CFO (thanks to SOX); in fact, I’d argue that the CPA is now a key to becoming CEO, as the CEO must sign off on the financial statements and pay the piper if the statements are wrong. Hours as a CFO can be bad, but my dad’s philosophy was that if you can’t get it done in 8 hours then you aren’t working efficiently enough, so he rarely worked more than 40-45 hours per week (multibillion dollar private insurance company).
Kkent, how did your father come about to becoming a CFO? What various accounting sectors did he do? corp fin., audit, etc?
Well, he became one in 1966 at the age of 33 (college drop out, enlisted in the military and went to Korea, cleaned air planes on the night shift, sold tires, and eventually returned to college to finish his degree in MANAGEMENT at age 27). My IQ is no higher than 120-125 (MAX) and I’m smarter than my dad was–he was just gifted at accounting. Contributed to textbooks, created computerized accounting systems in the 1960s and 1970s, and was exceptional at his job. His career pre-dated modern CPA/CIA/CFA designations, so I don’t think his story would be of much use to most people in 2007. This just goes to show that work experience is far more valuable to a person’s knowledge than a designation or a degree. But back to the original question at hand, from everything I can tell about my father’s actual career (unfortunately, I can’t ask him anymore), there’s almost nothing that I can see in the CFA curriculum that would be directly meaningful to a CFO of a private firm (FYI, he sucked at managing his own personal investments), but perhaps a CFO in a public company–as a top executive–would have to understand how his/her actions impact the bottom line and how it influences the price of stock. But the actual meat of the work of a CFO is overseeing accounting, auditing, and controls. CPA/CIA is HIGHLY relevant and probably mandatory in 2007, not to mention a degree in AT LEAST finance, if not accounting specifically.
stern, straight corporate finance, btw, is what he did.
Great story. Well, the CFA would be a useful background for a CIO, I guess. Aren’t half of CEOs actually former accountants? Is the CMA important for CFO’s as well? Do you plan on getting the CIA/CMA?
In the world or accounting/audting the CIA if for those can either can’t take or can’t pass the CPA so I have not interest in that. The CMA/CFM has crossed my mind, I don’t think it commands as muchn respect as the CFA. Not to mention that the Law of Diminishing Marginal Utility after you have more than a couple of these designations, people think all you do is study and no work. I haven’t made my final decision yet, but I think I’m going to try the CFA.
Recent info session at my school for a top CPG firm. Manager in “Supply Chain Finance”, “We pay for your CMA/CA/CGA etc to pursue and for sure your MBA. But we do not offer any assistance for your CFA. Actually if you want to pursue a CFA I would wonder why you are in Corp Finance in a F100 firm.” Sounds more like jealously if you ask me, I know some directors high up who have both a CMA/CFA combo. Also it makes the job to the street much easier if you want to do it later on. But It is true why would you want to go through 3years of pain to get something that adds no value in a Corp Finance position basically.
If I were to go into corporate finance, I would defiantly be inclined to stay in services industry, most likely financial services although I could see myself as a good fit for corp finance in a tech as well. I have no experience or desire to into CPG or manufacturing, etc, so I suppose his comments are not as relevant to my situation. I certainly to see your point about spending three years of pain for something that may not add much value outside of investments. We’ll see, I’m going to give level 1 a shot in June…
adehbone Wrote: ------------------------------------------------------- > Recent info session at my school for a top CPG > firm. > > Manager in “Supply Chain Finance”, “We pay for > your CMA/CA/CGA etc to pursue and for sure your > MBA. But we do not offer any assistance for your > CFA. Actually if you want to pursue a CFA I would > wonder why you are in Corp Finance in a F100 > firm.” > > Sounds more like jealously if you ask me, I know > some directors high up who have both a CMA/CFA > combo. Also it makes the job to the street much > easier if you want to do it later on. > > But It is true why would you want to go through > 3years of pain to get something that adds no value > in a Corp Finance position basically. what about corproate finance consulting in a public pratice…the cfa is probably pretty good their when you are looking to determine the ways a company can best improve its value. Also to pass the CFA youre going to need to have a very strong understanding of accounting in the first place.
??? Whodey, no offense but your posts don’t seem to make sense. The CFA subject matter is completely different from the CPA/CIA/CMA/CFM. The CFM is more of a treasury designation, the CMA is managerial accounting, the CIA is auditing, and the CPA is a general accounting designation. CPA, CIA is optimum for those in auditing, and the CIA is far more comprehensive and difficult exam than the audit portion of the CPA. The same goes for the other three accounting designations. As for recognition goes, the CPA, CMA, and CIA are pretty well recognized, but the CFM is the rarest of the four.
I am well aware that CFA subject matter is different from the CPA/CIA/CMA/CFM, but I don’t see what’s so wrong with being skilled in multiple areas of acct/finc. As SeanC put it, to pass the CFA you need a very strong understanding of accounting in the first place. I think the CFA is a great compliment to a CPA, I’m just wondering how much value employers place on the combination. What doesn’t make sense about that? P.S. The CIA is more extensive than the audit section of the CPA, that still doesn’t make it terribly difficult. The majority of audit work is completed and supervised by individuals <5 years out of undergrad, it’s a great learning opportunity, but after a point it just isn’t that difficult. Anyone with 2-3 years of audit work could easily pass the CIA with minimal study time, the same cannot be said for the CPA or CFA.
"but I don’t see what’s so wrong with being skilled in multiple areas of acct/finc. As SeanC put it, to pass the CFA you need a very strong understanding of accounting in the first place. I think the CFA is a great compliment to a CPA, I’m just wondering how much value employers place on the combination. What doesn’t make sense about that? " No, nothing at all. I’m doing the CFA/CPA right now. The CFA/CPA is highly valued and will get you the interview. Many research analyst jobs state “CFA or CPA” preferred…having both is a double plus. As for the CFA accounting portion, most of it is financial statement analysis rather than the myraid accounting elements present in the CPA exam. So it’s somewhat comparable to the financial Reporting and disclosure part of the CPA, which is a quarter of the Cpa. The accounting of the CFA is not even comparable…to the Audit, Tax law, managerial accounting, etc. that is present in the CPA but not in the CFA. I saw the kaplan CIA notes and it was roughly the same length of one level of the CPA, which makes it probably essential to know the thousand page Audit bible very well. I don’t see how it’s useful for a PM /associate PM/Assistant PM/or a research analyst to spend time studying so much auditing though.
sternwolf Wrote: ------------------------------------------------------- > I don’t see how it’s useful for a PM /associate > PM/Assistant PM/or a research analyst to spend > time studying so much auditing though. I fully agree, that’s why I never even considered the CIA, it was brought up in a post above by kkent referring to relevancy to the CFO position. On a different subject, you say you are doing the CPA/CFA now…like most people I used Becker for the CPA and passed with flying colors on the first try, so needless to say I am pretty satisfied with the Becker/Stalla approach to exam preparation. My company has a deal with Stalla, so it looks like that’s the one I’ll be using although two people I know that have passed L3 insist that Schweser is much better….what product are you using for the CPA and CFA review?