So you’ve just passed out the twelfth standard exams and have got admission into the best commerce college in town? What now? Which career to choose? What are the options? If you are doing commerce, most probably you’ll select a career in finance or marketing or maybe even HR!
Finance is a lucrative career for the thousands and thousands of fresh commerce under-graduates. It offers high salaries; excellent growth opportunities and better working conditions (Just ask the marketing guys about working conditions!!!).In India, you can become a finance professional by passing out CA, CFA or CWA. But, CA and CFA are the current hot courses which most students prefer.
CA stands for Chartered Accountant, a qualification which can be acquired from the ICAI (Indian Chartered Accountants Institute) and is a five year course.
On the other hand, CFA stands for Chartered Financial Analyst, a course offered by the ICFAI (Indian Chartered Financial Analysts’ Institute)
However the big question is which course is better? Which course offers that little bit extra that can help your career boom? Let’s try to find out!
CA is a more traditional and old-school course which includes auditing, costing and other such related concepts whereas CFA is a new, fresh option which deals mostly with investments, portfolio management etc
The conservatives, however, tend to go with CA. CA is considered to be a stable, high-yielding occupation which offers good growth opportunities.
On the other hand, CFA is a product of the new world economy and is a high profile, more “cool” and a modern occupation.
The course contents and examinations of CA are theory-based in line with the traditional Indian Education System whereas CFA offers a dynamic and a new approach to education and examinations. However, in CFA you have to take exams every three months which becomes a bit hectic as compared to the curriculum of CA.
A Chartered Accountant is more likely to join traditional banks or jobs related to auditing, costing etc whereas a Chartered Financial Analyst is more likely to join modern and high-profile investment banks, insurance companies etc.
But becoming a CA isn’t child’s play! Only 1-5% of all final year candidates clear CA. Not to mention, the vast majority who don’t even clear the Foundation and Inter Stages. Such a tough structure ensures that only the very best become qualified chartered accountants.
In this department, CFA is a bit more liberal. Quite a few number of candidates manage to clear the three levels i.e. LEVEL I, II and III. This is vastly due to the fact that CFA exam papers are multiple-choice based which makes the study-load on the students a bit less.
Both CFA and CA can be pursued along with your graduation course. However, you can appear for the LEVEL III examinations of CFA only after you complete your graduation.
Though both courses are related to finance, they are completely different from each other. They have completely different approaches. One offers auditing, business laws as its core subjects while the other offers financial management, investment analysis etc as its main subjects.
According to the ICAI website, The Institute of Chartered Accountants of India (ICAI) is a statutory body established under the Chartered Accountants Act, 1949. The objective of the institute is to (a) To develop conceptual understanding of the fundamentals of financial accounting system which processes transactions and other events through a book-keeping mechanism to prepare financial statements.(b) To impart skills in accounting for various kinds of business transactions.(c) To lay a theoretical foundation for the preparation and presentation of financial statements.(d) To develop an understanding of the rules of measurement and reporting relating to various components of financial statements.
According to the ICFAI site, The MS (Finance) Program is a two-year postgraduate professional program in financial management and analysis. Successful completion of the MS (Finance) Program leads to the CFA Charter from Council of Chartered Financial Analysts (CCFA). The focus areas include Corporate Finance and Control; International Finance and Risk Management; Investment and Portfolio Management; and Banking and Financial Services.
Again, there is a big gap in the popularity of the two courses. Over 2 lakh candidates enroll for CA every year as compared to the thousands that join CFA. This is due to the fact that CA is an old course while CFA has been recently introduced. But, mere numbers can’t be held as a benchmark of the efficiency of any course.
However, the final decision of selecting the right career rests with the individual. He should feel comfortable with the course and its contents. For example, a person may feel more comfortable with the theory-based approach of CA while some other person may feel more comfortable with the more dynamic CFA.
Remember, it is YOUR career and YOU have to decide what’s best for you!
-Anand Batra