After the Comma—A Perspective on the CGMA

*Look for this article in the upcoming June issue of Interim Report.*

By Rick Niswander, PhD, CPA, CGMA

Almost everyone reading this article has some letters after the comma at the end of their name. For most, those letters are CPA. Many also have CGMA. I would like to explain what those letters mean to me and what I believe they mean to the profession of accounting—both today and in the future.

I have been a CPA for 35 years. It is how I think of myself. It is who I am as a professional and, in many respects, as a person. Even my vehicle license plate says CPA.

Being a CPA means you are part of a profession. A profession is not you or me. A profession is “us.” A shared community. A common sense of who we are and how we relate to each other and the world. A shared responsibility to one another.

As professionals, we have an obligation to act ethically, to maintain and improve our knowledge, and to take very seriously the responsibility that we have to our clients or co-workers, to each other, and to society. It is much bigger than you or me.

Until last October, I was a member and, for the last two years, chairman of the Board of Examiners (BOE), the senior AICPA committee responsible for creation, administration, and grading of the CPA exam. One of the things we noticed was that the number of accounting graduates has been rising, but the number of exam sections taken has not materially increased. Some of the increase in graduates is likely because the population of international students has grown and many of those are not seeking a CPA, but intend to return to their home country. Yet, that only explains a small part of the growing gap.

So, the AICPA started an effort to more comprehensively understand the accounting pipeline. One of the actions undertaken was a study commissioned by the BOE to examine recent accounting graduates and discern the factors in their schools and places of employment that might be related to their decision to pursue (or not pursue) a CPA license.

Many interesting findings came from that study. To me, the most striking was related to the impact a student’s first job had on the probability they would become a CPA. Here are the key points:

  • Of those students whose first job was in public accounting, about 85-90% sat for the CPA exam, and 85-90% of those eventually passed the exam.
  • Of those students whose first job was in Business and Industry (B&I), only about 15% sat for the CPA exam, and only 50% of those eventually passed the exam.

While self-selection plays a role, the difference is nonetheless astounding. If you go the public accounting route, you have about a 75-80% chance of becoming a CPA, but if you start in B&I your chances are less than 10%. It also says that if you are a CPA working in B&I (where about 50% of AICPA and NCACPA membership resides), there is a high probability that you originally started in public accounting.

So, what happens if you don’t get a CPA? That brings me to the CGMA.

Five years ago, when the AICPA announced the joint venture with CIMA and the creation of the CGMA, I thought it was a strategic, forward-thinking masterstroke. CIMA is a 100-year-old organization with a management accounting orientation and a global footprint with almost no overlap with US CPAs. The venture increases the international reach of the US CPA, enhances the value proposition for the roughly 50% of membership in Business and Industry, and extends the CPA’s core values of quality, competency, and integrity across an entire accounting profession.

Importantly, the CGMA was created to be much more than a few letters after your name. It was formed to be a professional designation in the fullest sense of the word. From the start, the CGMA was designed to embody the hallmarks of a profession: a rigorous exam (trust me, I have seen the materials in the course of study), required educational attainment, a code of professional standards and ethics, and mandatory continuing professional development. Just like the CPA, you can’t just take the test and be done. And just like the CPA, the designation is more than just some letters. It is a profession.

As an educator, I was very pleased. It may come as a shock to you, but some accounting students simply do not want to pursue a CPA. Previously, if that was the case, I did not have much to offer beyond a degree. Often, these students went off to finance or IT or—gasp!—marketing. With the CGMA, as an educator I now have another valuable professional designation to offer students that will keep them in accounting. Clearly I am going to encourage students to pursue a CPA, but every sales pitch does not result in a sale. Now I have another meaningful path to offer. Another path that leads to something more than simply some letters.

The additional CGMA path is also beneficial to CPAs in public practice. The CGMA exam and continuing professional development will help those in B&I become more knowledgeable, confident, and professional employees. That, in turn, will help businesses operate better, which will help CPAs in public practice as they audit clients.

I strongly believe the CGMA is an “and” strategy. The CGMA expands the profession of accounting, and the AICPA’s relationship with CIMA supports the globalization of the accounting profession—all without diminishing the CPA.

Clearly, the AICPA, NCACPA, and other state societies need to keep their eye on the CPA ball. It is the foundation of who we have been for decades. But now, we have something additional of value to offer students, business enterprises, and society.

After the comma at the end of my name it says: CPA, CGMA. I have been proud of my CPA designation for 35 years. I am proud of my CGMA as well. Those sets of letters are distinct, yet complementary. The letters designate forward-looking professionals focused on accounting and business, and the combination will keep the CPA strong and the profession relevant and vibrant far into the future.


Rick Niswander_HeadshotRick Niswander, PhD, CPA, CGMA, is the Vice Chancellor for Administration and Finance at East Carolina University. Prior to this role, Rick served as the Dean of the College of Business at ECU and as a W. Howard Rooks Distinguished Professor for over six years. Rick received his bachelor’s degree in accounting from Idaho State University and his PhD in accounting from Texas A&M University. He’s been a CPA for 35 years and is very involved in the accounting profession. He recently completed a two-year term as chair of the AICPA Board of Examiners, has started a three-year term on the AICPA Board of Directors, and is a past chair of the NCACPA Board of Directors. Rick has been very involved in NCACPA serving on numerous committees, task forces, and advisory councils for nearly two decades.