CFA vs CPA Which one is better

This is Stephanie from FinanceResume.Net. Today well go over an important topic:
CPA vs CFA. Certified Public Accountant and Chartered
Financial Analyst designations are arguably the two most prestigious titles in their respective fields. What are the differences, and which one is better? An overview: the CFA and CPA titles cannot be compared apple-to-apple because they represent qualification
in two different sub-sectors within the general accounting and finance field.

CPA is the black-belt in accounting. It is originally a designation only for public
accountants, but non-public accountants, tax accountants and finance professionals seek
the CPA title to proof their general accounting expertise. The CPA also has statutory rights to sign
audit report which makes the title special. CFA, on the other hand, is the gold standard
in finance and investment.

For those who are looking for career as equity
analysts, fund managers, and professionals in asset management or hedge fund houses,
this is the best title they can get. Application & Qualification
CPA. The CPA license is granted by each of the
55 states or jurisdictions in the United States. There is no centralized administrative body
and each state has slightly different CPA.

Exam and licensing requirements. The eligibility criteria for US CPA is the
highest among all finance related qualifications. Candidates must have at least a 4-year bachelor
degree and in most cases, 150 credit hours, which is 5 years of higher education, to sit
for the exam. Because of the high barrier of entry and complicated
application process, it is quite a challenge for non-US candidates to take the exam.

CFA
CFA is a designation granted by CFA Institute, a global non-profit organization. The institute is based in the US, but there
are 3 regional offices and 200 local chapters around the world. Candidates apply through the institute and
application is relatively simple. As long as the candidate has a bachelor degree,
and not necessarily a 4-year degree, this person can sit for the exam.

Candidates can even take the first level
of the exam before graduation. Exam Content and Format
CPA. There are 4 exam sections: Financial Accounting
& Reporting, Audit & Attestation, Regulation and Business Environment & Concepts. The exam is 100% computerized consisting of
multiple choice questions, task-based simulations, which is a type of case studies, and written
communications.

Grading is mostly computerized. You can choose to take the 4 parts one at
a time, 2 at a time or even 4 at the same time. You can sit for the exam any time, from Monday
to Saturday, during the first 2 months of each quarter and at any prometric centers
throughout the US. There are also testing centers in Japan, Brazil
and 4 Middle Eastern countries.

CFA
The exam format is less flexible for CFA. There are 3 levels of exam, and you need to
complete one in order to move on to the next. Exam content is focused on financial analysis
and portfolio management instead of accounting, audit and taxation. The exam is in the traditional pencil-and-paper
format graded by human.

The test is administrated twice a year for
Level 1, and once a year for Level 2 and 3. There are many international testing centers
for CFA exam in major cities and metropolitan areas. Time required to obtain the designation
CPA. Most candidates aim to pass the CPA exam within
a year or within 18 months.

Some who have the time and commitment can
study all materials within 6 months, take all 4 parts of the exam in one go and pass. Most state boards require 1 year of accounting
experience before getting the license, and for most states this experience has to be
supervised and verified by a US CPA. CFA
Although technically candidates can complete the CFA exam within 18 months, most candidates
take 4 years to complete the exams. It takes much longer to become a CFA charterholder than a CPA.

4 Years of relevant experience is required
to get the CFA designation. Your supervisor, who will be verifying your
experience, does not need to be a CFA charterholder. This adds a lot of flexibility in the process. Conclusion
When deciding whether to go for CFA or CPA, the first and foremost consideration
is the relevancy to your career.

Other than that, CPA has more restrictive
education and experience requirement, but once you get qualified, the process is much faster. CFA has a lower entry barrier but it takes
much longer time to complete. You can certainly go for both, doing this
one step at a time. I hope this video helps in your decision between
CPA and CFA designations.

You may also want to subscribe to our Youtube channel for more information on the
these exams. Thanks for watching, and see you in the next
video..