CFA CFA General Thinking of taking the plunge into the CFA exam…

Thinking of taking the plunge into the CFA exam…

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  • Rhino6187
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    Greetings all,

    I hope you all can provide some feedback/guidance as I make my decision of whether to pursue the CFA designation. While no career decision is ever a sure bet, I’m seeking feedback before making the commitment, because I don’t half-ass anything, and if I commit to this thing, I’m going to finish.Therefore, I seek to make as informed a decision as possible. So let’s start with some background…

    I’m a CPA with a “Big 4” accounting firm, working in the audit/assurance practice of a major city. I’m 25, two years into my career and two years out of undergrad, still relatively young. I’ve recently made the decision to leave this firm and accepted and offer as an accountant with a growing REIT fund with $2 Bill+ in assets. I am doing this because my industries of interest are real estate primarily and investments secondarily. REIT funds are the only real hybrid of the two that will allow me to learn something about both by preparing the financial statements. Also, I really like the company and they’ve done very well for several decades.

    I realized very early in my career as an auditor that I did not desire to work in a financial reporting role (corporate controller) nor an audit role (audit partner) because it’s boring as hell. Financial reporting is primarily based on accounting for the past. I seek work that will help me make an impact on the future. I feel like controllers are scorekeepers and accounting partners are referees. Myself personally, I’m a ballplayer by nature. This is why I seek a stronger finance background. I took a few finance courses in undergrad and enjoyed them more than accounting. I see the CFA exam as a way to gain the knowledge and pedigree in finance to open doors to more interesting and rewarding work opportunities.

    Career goals are always important in a discussion like this one. First off, I do not seek to “break into IB” with Goldman or MorganStanley. I’m primarily just looking to open up as many interesting opportunities in the financial services world as possible and especially to avoid being branded as just an accountant. If I’d stayed in Big 4 accounting another four or five years, I’d be doing financial reporting for the rest of my life. I’d rather manag a REIT fund or mutual fund, or couple a Big 4 CPA background with a CFA and try to eventually land in a CFO role. At least then I’d get do more than just the financial reporting of the past, I’d be making decision that influence the success of a business. Money is of course somewhat of a factor, but by no means the main one. Though I’m approaching $100K in total comp and expect to be there in another three years or so, I could probably do that without the CFA. I love to make money and more never hurts, but it won’t make you happy if you hate the work you do. I’m not some jackass who’s looking at the CFA credential as some golden ticket to a $500K hedge fund manager gig at age 30. My main focus is making myself someone who can get involved in actually investing in and managing assets (ballplayer) and/or companies instead of just being an accountant (scorekeeper) tracking what others did.

    My experience with the CPA exam should be helpful to the process. Before anyone gets riled up, let me clearly state that having never studied any CFA material, I can confidently say that the CFA exam will be more difficult than the CPA. That being said, the CPA isn’t exactly a snooze fest, and I did the whole thing while working in big public accounting (70-80 hour weeks Jan-Mar. and 50 hr weeks the rest of the year). Having left public accounting for private industry, my average working hours will be greatly reduced (40 to 50 a week) while pursuing the CFA designation. Where I think my CPA exam background will prove most beneficial is my experience in balancing work and study, and in preparing a long-term study plan and churning through it with self-discipline when the pool parties and football games are seductively calling my name. That much should translate over.

    Should I decide to pursue a CFA charter, I plan on sitting for Level 1 in December 2013, Level 2 in June 2014 and Level 3 in June 2015.

    Given this overview of my goals and experiences, please respond with suggestions, ideas and thoughts on making the decision, and tips on getting started. Both positive and negative feedback is welcome, so feel free to play devil’s advocate.

    Thanks in advance.

    DollarsToDonuts
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    I think pursuing the CFA will be a worthwhile endeavor and one made slightly easier with your strong accounting background. It seems that you’re no stranger to busting your ass at work then studying for a designation, so I don’t see any problems with you coping with the CFA process.

    With that said, given your professional experience and the fact that you are a CPA, I think if you could move more into an analyst role, then the CFA may not be necessary. In my current role, I am responsible for researching equity managers, and it’s not uncommon for me to see CPA’s (without CFA designations) on these teams. From what I’ve seen, it is definitely possible for you to break into an associate role with just being a CPA.

    DollarsToDonuts
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    In short, I say go for it. You’re young, you have a complementary background, and you have the right attitude. However, like I mentioned, I have seen a lot of analysts with just a CPA.

    Zee Tan
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    I would agree with @DollarsToDonuts. A CPA is a very useful qualification to have. It’s true that a CFA charter will be a very handy thing to have if you’d like to move to managing funds, but it’s not absolutely necessary.

    But having said that, you’ve obviously done a lot of research on the CFA program so that already speaks about your drive and initiative. If you have the drive to do it, you should!

    The question ‘should I do the CFA’ should be answered with ‘what am I giving up?’ And in this case the CFA exams takes up your time. If you have the drive and the time I say you should go for it – having a CFA charter would help.

    When I first started working out of university, I wanted to take the CFA straightaway, but HR advised me not to take things too enthusiastically. That was, in retrospect, terrible advice. As far as the CFA is concerned, you should take it when you have the enthusiasm and drive for it!

    If taking the CFA turned out to be a mistake/waste of time for whatever reason, the only thing you would have sacrificed was your weekends and some funding, unlike say if you were considering an MBA.

    Just my thoughts 🙂

    Sophie Macon
    Keymaster
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    Hi @Rhino6187, thanks for sharing your thoughts and experiences with us.

    Having a CPA is a strong asset, and would enable you to rise towards being a CFO eventually. I do agree with you that financial reporting and audit is quite dull, I’m glad you’re taking active steps to steer your career towards aspects of your interest.

    That said, there’s usually 2 types of CFO, depending on industry. If it’s a slow moving one, CFO role tends to focus heavily on financial reporting / investor relations. If it’s a fast moving and dynamic sector, CFO plays an important role in M&A, strategy and operations too. I have seen both myself, and like you, I enjoy the latter type of work better.

    I personally debated taking CFA vs. CIMA (management accounting) vs. MBA a few years ago when I was 25. CIMA looked interesting to me but still had some hardcore auditing and my main purpose was to broaden my future career options (but not be an accountant per se too). I chose CFA in the end as it had more relevance and a ‘better’ global recognition worldwide.

    In your case, having a CPA at such a young age already puts you in strong position. However, if you’re keen at this stage of your career, and want an additional option to broaden your responsibilities in the REIT fund, I’d just say go for the CFA. There’s quite some knowledge overlap, you won’t cry in FRA section, and it’s a great CV enhancer in the fund management sector. Not much to lose here except 2 years worth of weekends…

    Sarah
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    @Rhino187 everyone’s given very rational and logical reasoning for their opinion. Then all you have to do is decide and here is my philosophical take on the final decisoin

    When faced with two choices, simply toss a coin. It works not because it settles the question for you, but because in that brief moment when the coin is in the air, you suddenly know what you are hoping for. -unknown

    Rhino6187
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    @Diya @Sophie @Zee @DollarstoDonuts

    Thank you all for you insightful responses. It seems as though you all agree that given my objectives, this would be a beneficial move for my career. It is also encouraging that many of you said the CPA would provide a complimentary background. I’ve heard some people say it would not help whatsoever. However, as investment decisions are generally based on financial statements, and auditors understand the nuts and bolts of financial statements as well as anyone, I don’t see how it could hurt.

    I will make a final decision by the end of this week. I want to go into my new gig on Monday already knowing for sure.

    Diya- I like your quote about flipping a coin. I may end up taking that approach, although I think I already know which side I will want it to land on.

    Sophie Macon
    Keymaster
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    Great @Rhino6187, let us know when you’d decided!

    And oh, having an accounting background works wonders for huge sections of Level 1 and 2, good ol’ Financial Reporting and Analysis (FRA)…

    DollarsToDonuts
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    @Rhino6187 To add to your rationale behind investment decisions, legendary value investor, Marty Whitman, describes financial statements and accounting as the “language of investing.”

    Rhino6187
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    @sophie @DollarsToDonuts @Diya @Zee

    Alright…I’ve decided to go for it. I’m going to take about three or for weeks to settle into the new job (started yesterday, seems great thus far) and catch up on everything I was putting off during busy season with my firm. After that, I’ll being reviewing for CFA Level 1 December 2013.

    **Cracks knuckles, pours coffee, takes a deep breath, bids social life farewell for the next 24 months**

    Sophie Macon
    Keymaster
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    @Rhino6187, it’s not that bad. You won’t have zero social life… you have us here 😉

    Zee Tan
    Keymaster
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    Good luck @rhino6187! Makes sense to put your new role first, and you have quite some time before Dec 2013 🙂

    DollarsToDonuts
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    Best of luck to you good sir!

    Snippy
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    Good decision @rhino6187! Best of luck!

    hairyfairy
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    Yay @rhino6187! I’m June 2013 but I’m sure we’ll both meet at June 2014 Level 2! 😀

    Rhino6187
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    @ Sophie @zee @dollartodonuts @sidmenon @hairyfairy

    Thank you all for your best wishes. You all should see more of me starting early June once I dive in and start studying. In the meantime, best of luck to all of you!

    Sophie Macon
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    Enjoy the time off @Rhino6187! We’ll see ya soon 🙂

    hairyfairy
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    Good luck @rhino6187! You’ll have to tell us all about your new job when you’re back here 🙂

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