CPA vs CFA: Battle of the Mega Certifications

January 9, 2014
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One summer evening, I asked my mother,” What is the difference between an apple and orange when they are both fruits?” My mother had just smiled and said that it was all about the taste.

The same scene brings a faint smile on my face every time I am asked about the differences between CPA and CFA. The basic difference that must be clear to any reader at the outset is that the two courses open up different gateways to your career. While CPA is more about accounting, CFA is all about finance.

Just like a child, I was intrigued to know the differences between apples and oranges. Similarly students at present want to differentiate between the CPA and CFA. Well, to sum up in a matter of few words, CPA offers you opportunities in auditing and accounting. CFA on the other hand is more about investment banking, hedge funds and portfolio management.

Despite the clear air of difference between the CPA and CFA, curiosity of people demanding the difference has been peaking up. To state the difference, let us compare the two courses on the basis of following parameters.

1) Board of administration:

CPA is administered by AICPA (American Institute of Certified Public Accountants) while CFA is being administered by the CFA institute. Both of these bodies have tremendous international recognition and are not confined by any borders.

2) Eligibility Criteria:

For CPA, a candidate must be a commerce graduate or hold equivalent or higher professional degree. CFA can be taken up any candidate who is in the final year of his graduation.

3) Levels and examinations:

CPA consists of one level and four exams whereas CFA consists of three levels of examination.

4) Time for Completion:

CPA takes less than a year time to be completed. CFA on the other hand requires minimum of 2 years for completing the three levels of examination.

5) Work Experience Requirement:

CPA does not require any work experience for certification. While CFA requires a minimum of four year experience in the concerned field for licensing.

6) Ease of completion:

Both the courses offer a mixture of multiple choice questions and subjective questions. Thus, ease of completion cannot be judged on the basis of the question paper format. However, following the word of those who have completed both CFA and CPA, CFA requires more input as compared to that of CPA.

7) Cost:

There is not much to compare about the cost of the two courses.The cost of completing the course is round about same. However, CFA examinations are held in India as well. So, the pain of travelling abroad for the sake of exam is avoided here.

On the conclusive sides, there are no parameters distinguishing between CPA and CFA other than their respective areas of operation. CPA comes with the assessed knowledge in accounting, auditing, tax, personal financial planning, technology consulting and business valuation. CFA on the other hand covers investments, portfolio management and financial reporting.

The essential difference to note in between the two is the stability. For cricket fanatics out there, it would be justified to compare CPA with Rahul Dravid while CFA is more of Yuvraj Singh. CPA officials have higher job security and tend to maintain a constant run with the incoming money. For the CFA professionals, paychecks can be huge on your lucky days and must be preserved for the rainy days.The path of CPA involves convention whereas that of CFA involves innovation and aggression. Both the trends have their requirements and it’s a matter of personal choice about which has to be decided as the favorite one.


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