CMA Coach CMA Part 2

CMA Exam Part 2 is similar in format and length to CMA Exam Part 1, but that is where the similarities end. Covering an entirely different set of subject matter, Part 2 of the CMA exam needs its own CMA study guide, materials, and practice.

The first thing you need to know is that you should study for each part of the CMA exam for at least 16 weeks. You don’t need to study for them together, since you won’t take them at the same time.

Many people also wonder if they have to take the CMA exam parts in sequence. You don’t. You can take them out of order. In fact, many people choose to take part 2 first. That’s exactly what I did.

However you schedule it out, know that CMA Exam Part 2 is going to require an earnest effort. If you’re ready to tackle it, let’s begin.

Originally published in 2012, this article was updated and republished on March 18, 2024.

CMA Part 2 Syllabus

CMA Part 2 Syllabus

This comprehensive CMA Part 2 course outline covers all six exam topics, including financial statement analysis, corporate finance, decision analysis, risk management, investment decisions, and professional ethics.

CMA part 2 syllabus covers six topic areas. These are:

  1. Financial statement analysis, which accounts for 20% of your exam score.
  2. Corporate finance, which accounts for 20% of your exam score.
  3. Decisions analysis, which accounts for 25% of your exam score.
  4. Risk management, which accounts for 10% of your exam score.
  5. Investment decision, which accounts for 10% of your exam score.
  6. Professional ethics, which accounts for 15% of your exam score.

Both the exam questions and essay questions will relate to these subject areas. The percentages are weighted calculations based on your actual number of right answers.

It’s important that you take each section seriously and dedicate study time to learning the content you’ll be tested on.

Most CMA candidates use a review course to learn the content through a combination of videos, audio lectures, and textbooks. A complete CMA review course also includes a study plan, practice exams, and coaching to keep you on track.

Some people find it helpful to start with the big picture and work down into the specifics. Read on for more detail on each section of the CMA Exam Part 2.

CMA Exam Part 2 Content: Strategic Financial Management

CMA Part 2 Content

Certified Management Accountants are often tapped for high-power roles that require strategic financial decision making. Part 2 of the CMA Exam ensures that people with this certification actually have that skill.

Applying financial knowledge, thinking critically, and displaying managerial aptitude are all important for this part of the CMA Exam.

Here is more info on what each section of Part 2 is about. The percentages show the relative weight given to each section in the exam for your final score.

A. Financial Statement Analysis – 20%

This section of the exam will test a lot of practical skills for analyzing the financial health of a business. You’ll need a solid grasp of financial statements and financial ratios, and all the factors that go into profitability analysis.

There will also be some content relating to reporting currency, functional currency, and foreign currency transactions.

Financial Statement Analysis

You should feel comfortable with the following:

  • For the balance sheet and income statement, prepare and analyze common-size financial statements (i.e., calculate percentage of assets and sales, respectively; also called vertical analysis)
  • For the balance sheet and income statement, prepare a comparative financial statement horizontal analysis (i.e., calculate year-over-year trends for every item on the financial statement compared to a base year)
  • Calculate the growth rate of individual line items on the balance sheet and income statement
  • Analyze financial statement data to identify patterns and trends that can be used to make business decisions

Financial Ratios

The following topics will be covered:


  • Calculate and interpret the current ratio, the quick (acid-test) ratio, the cash ratio, the cash flow ratio, and the net working capital ratio
  • Explain how changes in one or more of the elements of current assets, current liabilities, and/or unit sales can change the liquidity ratios and calculate that impact
  • Demonstrate an understanding of the liquidity of current liabilities


  • Define solvency and distinguish from liquidity
  • Define operating leverage and financial leverage
  • Calculate the degree of operating leverage and degree of financial leverage
  • Demonstrate an understanding of the effect on the capital structure and solvency of a company with a change in the composition of debt vs. equity by calculating leverage ratios
  • Calculate and interpret the financial leverage ratio (equity multiplier) and determine the effect of a given change in capital structure on this ratio
  • define, calculate, and interpret the following ratios: fixed charge coverage (earnings to fixed charges), interest coverage (times interest earned), and cash flow to fixed charges
  • Discuss how capital structure decisions affect the risk profile of a company
  • Calculate and interpret the following ratios: debt-to-equity, long-term debt-to-equity, and debt-to-total assets


  • Calculate and interpret accounts receivable turnover, inventory turnover, and accounts payable turnover
  • Calculate and interpret days sales outstanding in receivables, days sales in inventory, and days purchases in accounts payable
  • Define and calculate the operating cycle and the cash cycle of a company
  • Calculate and interpret total asset turnover and fixed asset turnover


  • Calculate and interpret gross profit margin percentage, operating profit margin percentage, net profit margin percentage, and EBITDA margin percentage
  • Calculate and interpret ROA and ROE
  • Calculate and interpret the market/book ratio and the price/earnings ratio
  • Calculate and interpret book value per share
  • Identify and explain the limitations of book value per share
  • Calculate and interpret basic and diluted EPS
  • Calculate and interpret earnings yield, dividend yield, dividend payout ratio, and shareholder return


  • Identify the limitations of ratio analysis
  • Demonstrate a familiarity with the sources of financial information about public companies and industry ratio averages
  • Evaluate the financial strength and performance of an entity based on multiple ratios

Profitability Analysis

You want to be sure you’re able to do the following:

  • Demonstrate an understanding of the factors that contribute to inconsistent definitions of “equity,” “assets,” and “return” when using ROA and ROE
  • Determine the effect on return on total assets of a change in one or more elements of the financial statements
  • Identify factors to be considered in measuring income, including estimates, accounting methods, disclosure incentives, and the different needs of users
  • Explain the importance of the source, stability, and trend of sales and revenue
  • Demonstrate an understanding of the relationship between revenue and receivables and revenue and inventory
  • Determine and analyze the effect on revenue of changes in revenue recognition and measurement methods
  • Analyze the cost of sales by calculating and interpreting the gross profit margin
  • Distinguish between gross profit margin, operating profit margin, and net profit margin, and analyze the effects of changes in the components of each
  • Define and perform a variation analysis (percentage change over time)
  • Calculate and interpret sustainable equity growth

Special Issues

  • Demonstrate an understanding of the impact of foreign exchange rate changes on financial statements
      • Identify and explain issues in the accounting for foreign operations (e.g., historical vs. current rate and the treatment of translation gains and losses)
      • Define functional currency
      • Calculate the financial ratio impact of a change in exchange rates
      • Discuss the possible impact on management and investor behavior of volatility in reported earnings
  • Demonstrate an understanding of the impact of inflation on financial ratios and the reliability of financial ratios
  • Describe how to adjust financial statements for changes in accounting treatments (principles, estimates, and errors) and how these adjustments impact financial ratios
  • Distinguish between book value and market value, and distinguish between accounting profit and economic profit
  • Identify the determinants and indicators of earnings quality and explain why they are important

B. Corporate Finance – 20%

This is the section of the test that will require you to use models (like a Capital Asset Pricing Models), interest structures, and bond sensitivity. It deals with managing a corporation’s financial investments as well raising capital.

You need to distinguish between different kinds of risk as well as assess relationships between risk and return. It will be important to apply an understanding of risk types like market, political, credit, systematic/unsystematic, industry and more.

This section also deals with financial markets, including Initial Public Offering (IPO), investment banks, and restructuring through mergers and acquisitions.

For this portion of the exam, you’ll want to feel comfortable performing the following tasks:

Financial Risk and Return

  • Calculate rates of return
  • Identify and demonstrate an understanding of systematic (market) risk and unsystematic (company) risk
  • Identify and demonstrate an understanding of credit risk, foreign exchange risk, interest rate risk, and market risk
  • Demonstrate an understanding of the relationship between risk and return
  • Distinguish between individual security risk and portfolio risk
  • Demonstrate an understanding of diversification
  • Define beta and explain how a change in beta impacts a security’s price
  • Demonstrate an understanding of the Capital Asset Pricing Model (CAPM) and calculate the expected risk-adjusted returns using CAPM

Long-Term Financial Management

  • Describe the term structure of interest rates and explain why it changes over time
  • Define and identify the characteristics of common stock and preferred stock
  • Identify and describe the basic features of a bond such as maturity, par value, coupon rate, redemption provisions, conversion provisions, covenants, options granted to the issuer or investor, indentures, and restrictions
  • Identify and evaluate debt issuance or refinancing strategies
  • Value bonds, common stock, and preferred stock using discounted cash flow methods
  • Demonstrate an understanding of duration as a measure of bond interest rate sensitivity
  • Explain how income taxes impact financing decisions
  • Define and demonstrate an understanding of derivatives and their uses
  • Identify and describe the basic features of futures and forwards
  • Distinguish a long position from a short position
  • Define options, and distinguish between a call and a put by identifying the characteristics of each
  • Define strike price (exercise price), option premium, and intrinsic value
  • Demonstrate an understanding of the interrelationship of the variables that comprise the value of an option (e.g., relationship between exercise price and strike price, and value of a call)
  • Define interest rate and foreign currency swaps
  • Define and identify characteristics of other sources of long-term financing, such as leases, convertible securities, and warrants
  • Demonstrate an understanding of the relationship among inflation, interest rates, and the prices of financial instruments
  • Define the cost of capital and demonstrate an understanding of its applications in capital structure decisions
  • Determine weighted average cost of capital (WACC) and the cost of its individual components
  • Calculate the marginal cost of capital
  • Explain the importance of using marginal cost as opposed to historical cost
  • Demonstrate an understanding of the use of the cost of capital in capital investment decisions
  • Demonstrate an understanding of how income taxes impact capital structure and capital investment decisions
  • Use the constant growth dividend discount model to value stock and demonstrate an understanding of the two-stage dividend discount model
  • Demonstrate an understanding of relative or comparable valuation methods, such as price/earnings (P/E) ratios, market/book ratios, and price/sales ratios

Raising Capital

  • Identify the characteristics of the different types of financial markets and exchanges
  • Demonstrate an understanding of the concept of market efficiency, including the strong form, semi-strong form, and weak form of market efficiency
  • Describe the role of the credit rating agencies
  • Demonstrate an understanding of the roles of investment banks, including underwriting, advice, and trading
  • Define IPOs
  • Define subsequent/secondary offerings
  • Describe lease financing, explain its advantages and disadvantages, and calculate the net advantage to leasing using discounted cash flow concepts
  • Define the different types of dividends, including cash dividends, stock dividends, and stock splits
  • Identify and discuss the factors that influence the dividend policy of a company
  • Demonstrate an understanding of the dividend payment process for both common and preferred stock
  • Define share repurchase and explain why a company would repurchase its stock
  • Define insider trading and explain why it is illegal
  • Identify the advantages and disadvantages of debt financing vs. equity financing

Working Capital Management

This section has a few different subsections. They cover the following:

Working Capital

  • Define working capital and identify its components
  • Calculate net working capital
  • Explain the benefit of short-term financial forecasts in the management of working capital


  • Identify and describe factors influencing the levels of cash
  • Identify and explain the three motives for holding cash
  • Prepare forecasts of future cash flows
  • Identify methods of speeding up cash collections
  • Calculate the net benefit of a lockbox system
  • Define concentration banking
  • Demonstrate an understanding of compensating balances
  • Identify methods of slowing down disbursements
  • Demonstrate an understanding of disbursement float and overdraft systems

Marketable Securities

  • Identify and describe reasons for holding marketable securities
  • Define the different types of marketable securities, including money market instruments, T-bills, treasury notes, treasury bonds, repurchase agreements, federal agency securities, banker’s acceptances, commercial paper, negotiable CDs, Eurodollar CDs, and other marketable securities
  • Evaluate the trade-offs among the variables in marketable security selections, including safety, marketability/liquidity, yield, maturity, and taxability
  • Demonstrate an understanding of the risk and return trade-off

Accounts Receivable

  • Identify the factors influencing the level of receivables
  • Demonstrate an understanding of the impact of changes in credit terms or collection policies on accounts receivable, working capital, and sales volume
  • Define default risk
  • Identify and explain the factors involved in determining an optimal credit policy


  • Define lead time and safety stock, and identify reasons for carrying inventory and the factors influencing its level
  • Identify and calculate the costs related to inventory, including carrying costs, ordering costs, and shortage (stockout) costs
  • Explain how a just-in-time (JIT) inventory management system helps manage inventory
  • Identify the interaction between high inventory turnover and high gross margin (calculation not required)
  • Demonstrate an understanding of economic order quantity (EOQ) and how a change in one variable would affect the EOQ (calculation not required)

Short-Term Credit and Working Capital Cost Management

  • Demonstrate an understanding of how risk affects a company’s approach to its current asset financing policy (aggressive, conservative, etc.)
  • Identify and describe the different types of short-term credit, including trade credit, short-term bank loans, commercial paper, lines of credit, banker’s acceptances, and letters of credit
  • Estimate the annual cost and effective annual interest rate of not taking a cash discount
  • Calculate the effective annual interest rate of a bank loan with a compensating balance requirement and/or a commitment fee
  • Demonstrate an understanding of factoring accounts receivable and calculate the cost of factoring
  • Explain the maturity matching or hedging approach to financing
  • Demonstrate an understanding of the factors involved in managing the costs of working capital


  • Recommend a strategy for managing current assets that would fulfill a given objective

Corporate Restructuring

You should be familiar with the following tasks:

  • Demonstrate an understanding of the following:
    • Mergers and acquisitions, including horizontal, vertical, and conglomerate
    • Leveraged buyouts
  • Identify and describe defenses against takeovers (e.g., golden parachute, leveraged recapitalization, poison pill (shareholders’ rights plan), staggered Board of Directors, fair price, voting rights plan, white knight)
  • Identify and describe divestiture concepts such as spin-offs, split-ups, equity carve-outs, and tracking stock
  • Evaluate key factors in a company’s financial situation and determine if a restructuring would be beneficial to shareholders
  • Identify possible synergies in targeted mergers and acquisitions
  • Value a business, a business segment, and a business combination using the discounted cash flow method
  • Evaluate a proposed business combination and make a recommendation based on both quantitative and qualitative considerations

International Finance

The CMA exam will test your ability to do the following:

  • Demonstrate an understanding of foreign currencies and how foreign currency affects the prices of goods and services
  • Identify the variables that affect exchange rates
  • Calculate whether a currency has depreciated or appreciated against another currency over time and evaluate the impact of the change
  • Demonstrate how currency futures, currency swaps, and currency options can be used to manage exchange rate risk
  • Calculate the net profit/loss of cross-border transactions and evaluate the impact of this net profit/loss
  • Recommend methods of managing exchange rate risk and calculate the net profit/loss of the recommended methods
  • Identify and explain the benefits of international diversification
  • Identify and explain common trade financing methods, including cross-border factoring, letters of credit, banker’s acceptances, forfaiting, and countertrade

C. Business Decision Analysis – 25%

When dealing with decision analysis content, you’ll encounter questions about costs, pricing, profit margins. These factors combine with market forces, productivity, and product life cycle.

As a CMA, you’ll need to synthesize all of this information to make strategic judgements. You’ll project pricing for goods and services, and how that pricing is impacted by supply and demand.

Questions will also require that you understand value added and non-value added cost, engineering, operating income per unit, and more.

Let’s look at each of the subjects covered in this section.

Cost/Volume/Profit Analysis

  • Demonstrate an understanding of how cost/volume/profit (CVP) analysis (breakeven analysis) is used to examine the behavior of total revenues, total costs, and operating income as changes occur in output levels, selling prices, variable costs per unit, or fixed costs
  • Calculate operating income at different operating levels
  • Differentiate between costs that are fixed and costs that are variable with respect to levels of output
  • Explain why the classification of fixed vs. variable costs is affected by the time frame being considered
  • Calculate contribution margin per unit and total contribution margin
  • Calculate the breakeven point in units and dollar sales to achieve targeted operating income or targeted net income
  • Demonstrate an understanding of how changes in unit sales mix affect operating income in multiple-product situations
  • Calculate multiple-product breakeven points given a percentage share of sales and explain why there is no unique breakeven point in multiple-product situations
  • Define, calculate, and interpret the margin of safety and the margin of safety ratio
  • Explain how sensitivity analysis can be used in CVP analysis when there is uncertainty about sales
  • Analyze and recommend a course of action using CVP analysis
  • Demonstrate an understanding of the impact of income taxes on CVP analysis

Marginal Analysis

This section will cover your ability to do the following:

  • Identify and define relevant costs (incremental, marginal, or differential costs), sunk costs, avoidable costs, explicit and implicit costs, split-off point, joint production costs, separable processing costs, and relevant revenues
  • Explain why sunk costs are not relevant in the decision-making process
  • Demonstrate an understanding of and calculate opportunity costs
  • Calculate relevant costs given a numerical scenario
  • Define and calculate marginal cost and marginal revenue
  • Identify and calculate total cost, average fixed cost, average variable cost, and average total cost
  • Demonstrate proficiency in the use of marginal analysis for decisions
  • Calculate the effect on operating income of a decision to accept or reject a special order when there is idle capacity and the order has no long-term implications
  • Identify and describe qualitative factors in make-or-buy decisions, such as product quality and dependability of suppliers
  • Calculate the effect on operating income of a make-or-buy decision
  • Calculate the effects on operating income of a decision to sell or process further or to drop or add a segment
  • Identify the effects of changes in capacity on production decisions
  • Demonstrate an understanding of the impact of income taxes on marginal analysis
  • Recommend a course of action using marginal analysis


  • Identify different pricing methodologies, including market comparables, cost-based, and value-based approaches
  • Differentiate between a cost-based approach and a market-based approach to setting prices
  • Calculate selling price using a cost-based approach
  • Demonstrate an understanding of how a company’s pricing of a product or service is affected by the demand for and supply of the product or service, as well as the market structure within which the company operates
  • Demonstrate an understanding of the impact of cartels on pricing
  • Demonstrate an understanding of the short-term equilibrium price for the firm in (i) pure competition, (ii) monopolistic competition, (iii) oligopoly, and (iv) monopoly using the concepts of marginal revenue and marginal cost
  • Identify techniques used to set prices based on understanding customers’ perceptions of value and competitors’ technologies, products, and costs
  • Define and demonstrate an understanding of target pricing and target costing, and identify the main steps in developing target prices and target costs
  • Define value engineering
  • Calculate the target operating income per unit and target cost per unit
  • Define and distinguish between a value-added cost and a nonvalue-added cost
  • Define the pricing technique of cost plus target rate of return
  • Calculate the price elasticity of demand using the midpoint formula
  • Define and explain elastic and inelastic demand
  • Estimate total revenue given changes in prices and demand as well as elasticity
  • Discuss how pricing decisions can differ in the short term and in the long term
  • Define product life cycle, identify and explain the four stages of the product life cycle, and explain why pricing decisions might differ over the life of a product
  • Evaluate and recommend pricing strategies under specific market conditions

D. Enterprise Risk Management – 10%

Managing risk is often a key part of a CMA’s role in a company. This part of the exam will address risk-related concepts and practices. You will need not only to define the types of risk but to describe the elements of each type.

Then, taking it further, test questions will require you to apply strategies for responding to or managing risk. This part of the test deals with Enterprise Risk Management (ERM), which you need to understand in-depth. Lastly, you may need to express the role of corporate governance in managing risk.

Enterprise Risk

In this section, you’ll be tested on the following tasks:

  • Identify and explain the different types of risk, including business risk, hazard risk, financial risk, operational risk, and strategic risk
  • Demonstrate an understanding of operational risk
  • Define legal risk, compliance risk, and political risk
  • Demonstrate an understanding of how volatility and time impact risk
  • Define the concept of capital adequacy (i.e., solvency, liquidity, reserves, and sufficient capital)
  • Explain the use of probabilities in determining exposure to risk and calculate expected loss given a set of probabilities
  • Define the concepts of unexpected loss and maximum possible loss (extreme or catastrophic loss)
  • Identify strategies for risk response (or treatment), including actions to avoid, retain, reduce (mitigate), transfer (share), and exploit (accept) risks
  • Define risk transfer (e.g., purchasing insurance, issuing debt)
  • Demonstrate an understanding of the concept of residual risk and distinguish it from inherent risk
  • Identify and explain the benefits of risk management
  • Identify and describe the key steps in the risk management process
  • Explain how attitude toward risk might affect the management of risk
  • Demonstrate a general understanding of the use of liability/hazard insurance to transfer risk (detailed knowledge not required)
  • Identify methods of managing operational risk
  • Identify and explain financial risk management methods
  • Identify and explain qualitative risk assessment tools, including risk identification, risk ranking, and risk maps
  • Identify and explain quantitative risk assessment tools, including cash flow at risk, earnings at risk, earnings distributions, and EPS distributions
  • Identify and explain Value at Risk (VaR) (calculations not required)
  • Define enterprise risk management (ERM), and identify and describe key objectives, components, and benefits of an ERM program
  • Identify event identification techniques and provide examples of event identification within the context of an ERM approach
  • Explain how ERM practices are integrated with corporate governance, risk analytics, portfolio management, performance management, and internal control practices
  • Evaluate scenarios and recommend risk mitigation strategies
  • Prepare a cost-benefit analysis and demonstrate an understanding of its uses in risk assessment and decision-making
  • Demonstrate an understanding of the COSO Enterprise Risk Management—Integrated Framework

E. Capital Investment Decisions – 10%

A Certified Management Accountant is often hired as CFO or controller, jobs that require them to oversee capital budgeting. This part of the CMA exam deals with everything from risk analysis for capital investments to cash flow analyses.

It will be important that you understand and can calculate things like pre-tax and post-tax cash flows (in regard to investments in capital projects), the factors that impact discount rates and payment values. You will want to be familiar with Net Present Value (NPV) and Internal Rate of Return (IRR).

There are two subsections in this portion of the CMA exam.

Capital Budgeting Process

  • Define capital budgeting and identify the steps or stages undertaken in developing and implementing a capital budget for a project
  • Identify and calculate the relevant cash flows of a capital investment project on both a pretax and after-tax basis
  • Demonstrate an understanding of how income taxes affect cash flows
  • Distinguish between cash flows and accounting profits and discuss the relevance to capital budgeting of incremental cash flow, sunk cost, and opportunity cost
  • Explain the importance of changes in net working capital in capital budgeting
  • Discuss how the effects of inflation are reflected in capital budgeting analysis
  • Define hurdle rate
  • Identify alternative approaches to dealing with risk in capital budgeting
  • Dstinguish among sensitivity analysis, scenario analysis, and Monte Carlo simulation as risk analysis techniques
  • Explain why a discount rate specifically adjusted for risk should be used when project cash flows are more risky or less risky than is normal for a company or business unit
  • Explain how the value of a capital investment is increased if consideration is given to the possibility of adding on, speeding up, slowing down, or discontinuing early
  • Demonstrate an understanding of real options, including the options to abandon, delay, expand, and scale back (calculations not required)
  • Identify and discuss qualitative considerations involved in the capital budgeting decision
  • Describe the role of the post-audit in the capital budgeting process

Capital Investment Analysis Methods

  • Demonstrate an understanding of the two main discounted cash flow (DCF) methods, NPV and IRR
  • Calculate NPV and IRR
  • Demonstrate an understanding of the decision criteria used in NPV and IRR analyses to determine acceptable projects
  • Compare NPV and IRR, focusing on the relative advantages and disadvantages of each method, particularly with respect to independent vs. mutually exclusive projects and the “multiple IRR problem”
  • Explain why NPV and IRR methods can produce conflicting rankings for capital projects if not applied properly
  • Identify assumptions of NPV and IRR
  • Evaluate and recommend project investments on the basis of DCF analysis
  • Demonstrate an understanding of the payback and discounted payback methods
  • Identify the advantages and disadvantages of the payback and discounted payback methods
  • Calculate payback periods and discounted payback periods
  • Define and calculate the profitability index
  • Describe how sensitivity analysis is used in capital investment decision analysis

F. Professional Ethics – 15%

The IMA has a Statement of Ethical Professionals that any CMA must know and comply with. This is guided by a set of ethical principles, which may come into play in this part of the exam.

It will be important that you can respond to ethical scenarios that may include manipulation, fraud, standards, and more. Specifically related to fraud, you will need to know what the Fraud Triangle model is and explain how it can be used to mitigate the risk of fraud.

The IMA notes that ethics may be tested in conjunction with any topic area.

There are three specific topics related to ethics in this portion:

Business Ethics

  • Define business ethics
  • Define the concepts of fairness, integrity, due diligence, and fiduciary responsibility and how they impact ethical decision making
  • Identify and explain the different types of business fraud, such as asset misappropriation, manipulation of financial statements, cash and inventory theft, payroll fraud, fake suppliers, and accounts receivable fraud

Ethical Considerations for Management Accounting and Financial Management Professionals

Using the standards outlined in the IMA Statement of Ethical Professional Practice, you should be able to:

  • Identify and describe the four overarching ethical principles and the four standards
  • Evaluate a given business situation for its ethical implications
  • Identify and describe relevant standards that may have been violated in a given business situation and explain why the specific standards are applicable
  • Recommend a course of action for management accounting and financial management professionals to take when confronted with an ethical dilemma in the business environment
  • Evaluate and propose resolutions for ethical issues such as fraudulent reporting or improper manipulation of forecasts, analyses, results, and budgets

Using the fraud triangle model, you want to feel comfortable with the following:

  • Identify the three components of the triangle
  • Use the model to explain how a management accounting and financial management professional can identify and manage the risk of fraud

Ethical Considerations for the Organization

  • Discuss the issues organizations face in applying their values and ethical standards internationally
  • Demonstrate an understanding of the relationship between ethics and internal controls
  • Define corporate culture and demonstrate an understanding of the role corporate culture plays in ethical decision making
  • Demonstrate an understanding of the importance of a code of conduct and how it contributes to an organization’s ethical culture
  • Demonstrate an understanding of the ways ethical values benefit an organization
  • Analyze the impact of groupthink on ethical behavior
  • Discuss how diversity of thought can lead to good ethical decisions
  • Demonstrate an understanding of the role of “leadership by example” or “tone at the top” in determining an organization’s ethical environment
  • Define ethical leadership, and identify and explain the traits of ethical leaders
  • Explain the importance of creating a climate where “doing the right thing” is expected (e.g., hiring the right people, providing them with training, and practicing consistent values-based leadership)
  • Explain the importance of an organization’s core values and how they promote ethical behavior and ethical decision making
  • Discuss the importance of employee training to maintaining an ethical organizational culture
  • Explain the importance of a whistleblowing framework to maintain an ethical organizational culture
  • Demonstrate an understanding of the differences between ethical and legal behavior
  • Identify the purpose of anti-bribery laws, such as the U.S. Foreign Corrupt Practices Act (FCPA) and the U.K. Bribery Act
  • Discuss corporate responsibility for ethical conduct
  • Define and demonstrate an understanding of the major issues of sustainability and social responsibility
  • Identify and define the four levels of social responsibility: economic, legal, ethical, and philanthropic
  • Identify and define the three conceptual spheres of sustainability: economic, environmental, and social
  • Define data ethics and explain the principles of fairness, privacy, transparency, ownership, and accountability with respect to how companies and artificial intelligence (AI) models use and maintain the data they collect
  • Demonstrate a general understanding of the purpose of governmental data protection regulations

CMA Exam Part 2 Format

CMA Part 2 Format

All of the content listed above is organized into part 2 of the CMA exam in a pretty straightforward way. There are two sections, and both are computer-based.

Read on to learn the exam format, what the two sections entail, and how they’re scored.

Multiple Choice Questions

On the CMA exam, you’ll begin with multiple-choice questions. According to the IMA, these are some basic facts about the multiple-choice questions in CMA Exam Part 2:

  • 75% of your overall score
  • 100 questions total
  • No marks off for wrong answers
  • You will have 3 hours, or about 1.8 minutes per question
  • You must get 50% of the questions correct to progress to the essay questions

Note: The best Certified Management Accountant practice tests will include a huge assortment (and number) of multiple-choice questions. Practicing with a realistic timed exam simulation should be a core part of your CMA exam prep.

Make sure your study materials include a quality bank of practice questions that have authentic, varied material. It’s also important that you find thorough answer explanations. Ideally, you’ll be a CMA study program that has all of these materials, so you can study in a streamlined way.

Essay Questions

CMA exam essay questions come after multiple-choice questions. Here are the details:

  • 25% of your overall score
  • 2 essays total
  • Each essay will be a scenario that has 5-7 additional questions
  • You will have one hour, or about 30 minutes per essay question

To effectively answer CMA essay questions, be sure you read the question in its entirety, take notes, show your work as you go, and pay attention to what is actually being asked. You want to write clearly and succinctly.

It’s best not to leave questions blank. If you are running out of time, you should at least create an outline and jot down some main points.

Conquering both sections on part 2 of the CMA exam requires a plan.

CMA Part 2 Study Plan

Study Plan for CMA Part 2

No question, the CMA exam is difficult. It’s intended to test your ability to apply knowledge of advanced accounting and financial management concepts in the real world.

This is a more in-depth studying experience than an exam that only tests you on facts. You can’t rely on memorization skills alone, or even primarily. Passing the CMA exam requires knowing the material enough to apply it expertly under the timed pressure of the exam.

The right CMA Part 2 study plan is going to guide you through all the content areas and provide the right amount of practice. You need to plan your study time well, cover all of the material, and buy the right course.

Here are the basics of putting together your plan to conquer CMA Part 2:

Plan Your Study Time

You should dedicate at least 16 weeks of study for part 2 of the CMA exam. Over the course of those weeks, you will ideally follow a program that organizes your study for you.

Whether you self-study, partially self-study or commit totally to a single CMA course, don’t deviate from your plan. The sheer quantity of content you need to learn makes even four months seem short.

Once you know how long you are going to study, reverse-engineer a CMA study plan that allocates your study hours by month, week and even day. Getting that specific will give you clear parameters and help you understand the kind of effort it’s really going to take.

In addition to our comprehensive course materials, we also recommend using a high-quality CMA textbook to supplement your studies. We offer a variety of textbook recommendations based on your learning style and preferences.

Practice All Question Types

Within the 100 multiple choice questions are various question types. You may encounter one of the following four question types:

  1. Negative questions, which will include phrasing like “not” or “unless.”
  2. Direct questions, which are the most frequently used type.
  3. Multiple answer options, in which you’ll have to choose one as the correct answer choice.

Practice quickly identifying the question type, and develop strategies based on each type. The faster you can eliminate wrong answers the better, and the question type can help you do that.

Make sure your study plan includes a full practice exam at the start and again after you’ve reviewed all the material. At that point, you’ll be able to identify your weak areas, as well as the type of questions that trip you up.

Online CMA Courses

CMA online courses provide a full-length study program that is usually taught by CMA experts. A good package will have video lessons, audio lessons, CMA textbooks, CMA practice questions, exam simulations, and may include additional study support.

Buying the right CMA review course is super important. It will literally make or break your progress. Check out our guide to choosing the best CMA review course, pick one, and get started!

CMA Part 2 FAQs


Here are some answers to frequently asked questions about part 2 of the CMA exam.

Which is Harder: CMA Part 1 or Part 2?

CMA Exam Part 1 and Part 2 cover different content. They both have several broad categories and cover a range of ideas. For most people, which section is more difficult comes down to education and experience. People who have a background in Finance usually have an easier time with the CMA Exam Part 2.

For professionals who have a degree in Accounting, CMA Exam Part 1 may be easier. Some people take the CMA exam without having any accounting experience at all. At that point, it may be valuable to review the content in both and decide which you want to take first based on personal knowledge and comfort level.

How Long Does it Take to Pass CMA Exam Part 2?

It takes at least 16 weeks to study for the CMA Exam Part 2. The exam itself is four hours long. Predicted score release dates are usually about 8 weeks after your test date.

What Topics to Study for Part 2 CMA?

Part 2 of the CMA exam covers six topics. You will need to study:

    1. Financial Statement Analysis
    2. Corporate Finance
    3. Decision Analysis
    4. Risk Management
    5. Investment Decisions
    6. Professional Ethics

How Difficult is CMA Part 2?

The CMA exam pass rate is 50% for both parts of the CMA exam.

Have more questions? Drop them below and I’ll provide answers!


Back to Frequently Asked Questions

70 Comments on “CMA Part 2: Strategic Financial Management”

  1. Please advise me about number 4 below this means I can select more the one answer?
    Practice All Question Types
    Within the 100 multiple choice questions are various question types. You may encounter one of the following four question types:
    1-Negative questions, which will include phrasing like “not” or “unless.”
    2-Direct questions, which are the most frequently used type.
    3-Multiple answer options, in which you’ll have to choose one, more than one or none.
    4-Variable questions, which are similar to multiple answers but presented in columns.

    1. Hi Mohammed,

      Thank you for your question.

      It looks like there was an error in this article. We went ahead and updated it.

      There won’t be any “Variable questions” on the exam.

      As for the “Multiple answer options” type, you’ll have to choose one as the correct answer choice.

      My apologies for the confusion.

  2. Hi I am preparing for Part 2 first. is there any harm in doing that. Someone told me if i clear part 2 first and cannot clear part 1 within 1 year of registration I will have to sit for both exams again. but the same is not so if I clear my Part 1 first. Please help clarify.

  3. Hi,
    Nathan Liao,

    I am from UAE. I would like to get your CMA Books both part 1 & Part2.
    Can Please inbox me with your price with special discount.

    Thanks & Regards,

  4. Hi Nathan Liao

    Mohammed – from Egypt

    i`m taking my part 2 exam next month , is financial calculator allowed for this exam or the simple one , and if not allowed how will problems like IRR and NPV and the like problem calculations be worked out .
    thanks .

    1. Hi Mohammed,

      You’re allowed to bring in a calculator to your exam. Check out here the calculator rules.

      Good luck on your exam!

  5. Hi Nathan,

    Am Shruthi from Dallas.

    Firstly wanted to say thanks to you and you’re guiding many students and many are getting benefited out of this.

    I would hereby request you to please help me with study materials for part 1, I have registered for CMA part 1 exam and I decide to do self study without going any coaching classes Is that possible to do ? please suggest what best thing i can do to sitting and studying at home.

    I have done my Master in MBA finance and I have 7years experience in Accounts and finance stream.

    Thanks in advance.

    1. Hi Shruthi,

      Thanks for reaching out!

      Yes, you can surely self-study for the CMA exam. The study tools you’ll need are the textbooks and a test bank. They are both crucial for your exam success and you can find them here.

      If you need anything else, let me know 🙂

      Thank you

  6. Hi,

    I applied for CMA in Aug 2016 but I appeared for the exam in 2017 May. I heard that there is a time limit for clearing both exams which is 3 years. My question is 3 years is from 1st exam or from registration/enrollment, which in my case is Aug 2016 ?

    And also I have Gliem 2015 MCQs/material, can you confirm if there were any changes in the MCQs after that ? Because I checked 2018 Ethics and found few changes in the book. I don’t have MCQs for 2017 or 2018.

    1. Hi Mr Singh,

      The 3-year countdown starts from the day you paid the CMA entrance fee.

      And yes, the ICMA introduced some changes in FASB rules and standards in Part 1 this year. Due to that, I undoubtedly recommend you to study from the latest releases.

      I currently run a promotion on our Part 1 textbook, if you’re interested, please check it here.

      We also offer a test bank with unique adaptive-learning technology at the CMA Exam Academy. It will diagnose your strengths and weaknesses by content area and then tailor your study sessions to focus on your learning needs. It’s very effective and will dramatically reduce your study time. Check it out here.

      If you have any other questions, let me know! 🙂

    1. Hi Jacob,

      It’s best to start with the part you’re most familiar with. Click here to check the topics tested on each part.

      Let me know if you have any other questions.


  7. Hi,
    I am working in Dubai as accountant for past 1 and 1/2 years. I would like to know which is a most preferable accounting course for me ..I hold a MBA in finance and HR

    1. I recommend you the CMA coaching course, check it here. It includes all the study tools you need to prepare efficiently for the CMA exam and pass it with flying colors. It also comes with unlimited 1-on-1 coaching for you to ask as many questions as you need along the course to truly grasp the material.

      Let me know if you have any other questions, I’ll be happy to help.


  8. Hasim Shaikh

    I am MS Accounting and need to know syllabus and study materials
    Is there any phone number or office address that give me entire details in Baltimore

  9. HI
    I had done my Bachelor Degree in Mathematics and also completed Master degree in computer science since 9 year s I am working in accounting field. If I go with CMA it could be helpful for me or not? Since I didn’t do or any accounting degree it will be difficult for me or not? please advise


    1. Hi Afzal,

      Don’t worry about your degree. There’s a lot of candidates who pass the CMA exam without an accounting degree.

      You will just need some extra effort in studying accounting-related concepts that may not be familiar to you.


  10. Hi Nathan, can you please tell me what topics are covered under Part-2 Section A(Financial statement analysis)-“Basic Financial statement analysis.

  11. hello ,,, first thanks for these helpful information about cma part 2,
    i’ve took cma part 1 exam in 2016 sep\oct exam window , unfortunately i didnt pass , so i want to study for part 2 and set for part 2 exam and re-set for part 1 exam at 2017 may\june exam window, is taking both parts exam in one window is allowed ? , and if it is allowed is it attianable, if you gave me some advice about that i will be thanksful.

    1. Hi,

      Yes, it is possible to take the exam in one testing window. Although I don’t suggest to take it on just one day. For example, you may take CMA Part 2 in May and CMA Part 1 in June ( for May/June 2017 testing window).


  12. Dear Nathan

    1. Kindly provide what topics have been excluded/included in CMA Part 2 in the current syllabus contents of year 2016 compared to year 2015. Example: I noticed that Basic Financial statement & their uses, Statement of BS, IS, Retained Earnings, Cash flow which were there in 2015 are not there in 2016 Gleim Edition of 2016.

    Kindly arrange to provide the list of topics which have been added/deleted in the current year.

    Thanking you with regards

    1. Hi Kersi,

      IMA added “External Financial Reporting Decisions” in Part 1.

      Thanks and Regards,

  13. Dear Nathan,
    Trust my email finds you well,
    Nathan I had Graduated from my University in 2015 as a Management Student, Know I am working as a Document Controller in a Construction company, however I am a little confused if I study the CMA or Study Masters in Management . Can you please advice ?

    1. Hi Ahmad,

      To answer your question, you may read my article about the CMA vs MBA using this link.

      Thanks and Regards,

  14. Mr. Nathan, h r u? I’ d like to tell you that I have bachelor of education E department. now I passed part1 exam of the cma and I am preparing myself for part2. My questions: is cma suitable for me? Especially, I don’t have any experience in accounting or work in it. What field can I work? And can I take part2 exam in Jan/Feb period? Thanks for your help.

    1. Hi Mai,

      Congrats for passing the Part 1 of the CMA Exam! That is already a proof of your knowledge in finance and accounting. I suggest that you try applying for finance or accounting jobs after passing the CMA exam even if you don’t have prior experience in accounting. It will give you a big advantage over non-certified peers.


    2. Hi Mai,

      Congrats for passing the Part 1 of the CMA Exam! That is already a proof of your knowledge in finance and accounting. I suggest that you try applying for finance or accounting jobs after passing the CMA exam even if you don’t have prior experience in accounting. It will give you a big advantage over non-certified peers.


  15. hello
    its wonderful to meet people like you
    iam examining the part 2 at the end of this October i have less than three months
    and i need some experience
    note iam a college student at my last semester
    i need advice it will be very hopeful
    thank you

    1. Hi Feras,

      Don’t worry about the experience requirement. You can complete the CMA experience requirement within seven years after passing the examination.

      For more helpful information about the CMA exam, please visit my blog at


  16. What is the difference between CFA and CMA. Which one is better considering the factor of time, money, and job opportunities/

  17. Hello Mr. Nathan Liao,
    I want to know exactly what is the new in CMA part 2, please?! .. moreover, does part 1 in the new version contain ethics topic?! Or the new version gathered the two branches of ethics -individaul & oragnizional- in part 2 only?!

    1. Hi Ahmed,

      Here are the topics for Part 1 and Part 2:

      Part 1
      A. External Financial Reporting Decisions
      B. Planning, Budgeting and Forecasting
      C. Performance Management
      D. Cost Management
      E. Internal Controls

      Part 2
      A. Financial Statement Analysis
      B. Corporate Finance
      C. Decision Analysis
      D. Risk Management
      E. Investment Decisions
      F. Professional Ethics

      Ethics topic will only be tested in Part 2.

      Thanks and Regards,

  18. Hi ,
    Thanks for your support,

    I actually ask about the approach or for CMA 2016 it is different than 2015

    Also can I start with part 2 rather than part one

    1. Hi Shams,

      There is no difference in approach for 2016 and 2015 CMA exam. It is still the same.

      You can take Part 2 first and you can also take both within the same testing window.

      Thanks and Regards,

  19. Dear Nathan,

    I was studying CMA part 1 last year but because of load of work I did not go for paper. Now my tuition teacher will start CMA part 2 classes from Monday 28th. And I will sit in exams in June.
    Will you help me, I need tips to pass CMA part 2.

    1. Hello Sohail,

      Thanks for reaching out.

      I’d be more than glad to guide you in you preparation for the CMA exam. That’s what I’m here for.
      There are three ways I can do this for you and you can pick one or more:
      I have a lot of free content in my blog and my FAQ page. You can browse here:

      The second way is to join me in a webinar I host each week here:

      And the third way is to check out the guides and coaching programs I currently offer to candidates who are finding great success at passing the exam:

      Let me know if you have any questions after taking a few moments to check those resources out.

      Thank you,

  20. Am From India I have completed and IPCC 1st group but now am interested in CMA USA can I pass in first attempt and how much salary can I get after certification and how can I get job in abroad

  21. Dear Mr Nathan
    First of all i wanna say you are doing very great job.i can see here so many peoples are getting benefit from your suggestion

    I have a problem .i hope you can guide me.I want to do self study without going any coaching can you suggest me what is best thing that i can do it by sitting at home to learn & understand things by my self . I dont have any manufacturing background but I am doing accounting job.
    I dont have books so from where I can get it.

    Sarfaraz Ali

  22. Hi,

    I have attempted, CMA part 2 in Feb 2016 window. when can i expect the result, MCQ and Essays was ok for me. How the scoring will be done. Am i need to start the preparation for PART 1, or need to revise the PART 2 still the result out.

    1. Hi Shibu,

      If you’d like start preparing for the CMA Part 2 exam if you want to take it in the upcoming window.

  23. hi Nathan ,

    I’d like to thank you for your great efforts , and would asking you is the basic financial statement still tested in the cma part 2 exam under the new update 2015 or its ignored


  24. Hi,Nathan
    Your post is very helpful
    I want to ask if which is better to start part one or two first… And at what time the exams held on the year
    Thanks in advance

    1. Hey John,

      I’m glad it was helpful. Thanks for your feedback.

      If you have manufacturing experience, then go for Part 2. Otherwise go for Part 2 first. The exam windows are held in Jan/Feb, May/June, and Sep/Oct. So we are in essence in the last window of 2015. Let me know if I can help with any other questions. Also feel free to check out my FAQ page to find answers to common questions about the CMA exam.

  25. Hi Nathan !!
    Your post is very helpful. I want to ask u that I want to take CMA part 2 exam in the end of this October.I am left with only a month for the preparation.Would I be able to pass the exam If i study 8 to 10 hours a day ? Please reply me as soon as possible, I would be very thankful to you.

    1. Hi Amna,

      I would recommend that if you just began studying to postpone your exam to Jan/Feb 2016 window. To pass the exam, you need at least 3 months of preparation.

  26. Hi .I would like to know As an ACCA Affiliate would I be able to get CMA Part 1 exemption.
    thanking yours

  27. Hi,
    I am an Indian student and currently living in Arizona state on a dependent visa (H4). I want to know which is better CMA or CPA . I have done Bachelors of Commerce (BCom) and Company Secretary (ICSI) from India.

    1. Jyoti, if you are looking to work in private accounting and in management, the CMA is the way to go. If you prefer public accounting, taxes and audit the CPA is more relevant.

  28. Hi,
    i currently hold the CPA license but work as a cost accountant for the past 10 year. We are are on a job order costing method and i usually analyze all the mfg variances, purchase price variance, Gross profit margin analysis and standard cost maintainence. As a cost accountant, i also close all the jobs that were completed for the month and capture the Cost of Sales for the month.
    I really want to pursue the CMA cert. since i am interested in management accounting than taxes and auditing. i was wonder if you know if the experience i mention above will be ok for me to earn the CMA cert (if i pass the exam). PLease reply with your thoughts/comments. Any help is greatly appreciated. Thanks

    1. Hi Steve,

      I believe your experience will satisfy the work requirement. However, to be absolutely safe, contact the IMA’s support desk and verify it. It’s always best to be safe and sorry. Go to Let me know if you have any other questions.

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