“A CA leaves, CFA takes over”
By the above-mentioned line what I’m trying to share is the significance of CFA along with the CA. This phrase indicates that a CA leaves by preparing the Balance Sheet and thereafter CFA takes over to analyze the same. And hence if you have knowledge of both the courses, it will provide you an edge in the field of Finance. It is especially for the ones who want to build their careers in the dream profiles such as Stock market, Equity research analyst, fixed income analyst, Capital market, Mergers, and Acquisitions.
CFA
CFA stands for Chartered Financial Analyst. The CFA designation is provided to investment professionals on successful completion of the requirements set by the globally recognized CFA Institute (formerly the Association for Investment Management and Research, or AIMR).
The Chartered Financial Analysts work for the banks who are indulged in the investment portfolio, mutual fund firms, hedge funds, brokerage houses, boutique money managers, etc.
Employers across the globe know the value of the CFA charter and recognize the CFA charter as the standard of professional excellence. Therefore, CFA gives you the edge and the advantage in the global employment market. If you’re interested in portfolio management, investment research, advisory services, or investment banking, then CFA is an option that you must consider.
The CFA program is globally recognized, a graduate-level program that provides a strong foundation of real-world investment analysis and portfolio management skills along with the practical knowledge you need in today’s investment industry.
It consists of 3 difficult levels, culminating in three different exams that you need to pass in order to acquire the CFA charter.
CFA is a self-study program with the main focus on practical knowledge rather than only theoretical knowledge which will be useful to you on the job. It is primarily intended supposed for individuals with a career in investment and international Finance. One of its main advantages is that it is a global designation– wherever you want to continue your career, the CFA charter will be recognized.
The course of study is organized into 10 general topic areas that offer a framework for generating investment decisions:
- Ethical and professional standards
- Quantitative methods
- Economics
- Financial reporting and analysis
- Corporate finance
- Equity Investments
- Fixed income Investments
- Derivatives
- Alternative Investments
- Portfolio management and wealth planning.
In order to become a CFA program candidate, you have to have a bachelor’s degree or have 4 years of qualified, professional work experience. Plus, you have to meet the professional conduct admission criteria, so be prepared to take exams in English. You must also have a valid international travel passport. CFA exams take place at the start of June, with the exception of Level 1 exam which takes place both in June and in December.
CA
A CA is a finance professional who deals with accounting, taxation, auditing, and evaluation of any business establishment. Though bookkeepers in firms need not be chartered accountants, most big organizations prefer CAs streamlining their statements. Having correct and up to date accounts is significant for any company. And that’s why there is a great demand for Chartered Accountants in the industry.
Eligibility
- The candidate has to clear the CPT after the HSC exam or directly after the intermediate exam.
- The candidate must clear the intermediate exam (divided into two parts) after completing the first part i.e. the IPCC level. Candidates need an internship as an article assistant for a minimum of 3 years in a chartered firm.
The Difference in Exam Format
The Chartered Accountant (CA) program consists of 3 levels, which are as follows-
- CPT
- IPCC
- CA FINAL EXAM
CPT (Common Proficiency Test)
It consists of a set of 200 multiple choice questions with negative marking for each wrong answer.
IPCC (Integrated Professional Competence Course)
It consists of two sessions. Session 1 has 4 subjects and session 2 has 3 subjects. You can take the exam for both sessions separately or together. Both the sessions have essay type questions.
CA Final Examination
It is divided into two sessions each group containing 4 subjects each. You can take the exam for both sessions separately or together. Both have essay type of questions.
Whereas, CFA program consists of 3 exams to clear which are as follows-
- 1st Level: It has 240 multiple choice questions divided into 3-hour sessions. It has no negative marking for a wrong answer.
- 2nd Level: It has 120 multiple choice questions which do not have any negative markings.
- 3rd Level: It has 8-12 essay type questions which are being conducted in the morning and 10 multiple choice questions which are being conducted in the afternoon. The candidate has to be present for both.
From the above comparison, you can figure that fundamentally CA and CFA are similar to one another. However, the level of difficulty and scope of employment varies among the two. If you are planning to appear for either of the two courses, make sure you’ve laid out your plan of action well in advance. Best of luck!
