Chartered Institute of Management Accountants (CIMA) CGMA Competency Framework and Professional Skills Syllabus

CGMA Competency Framework and Professional Skills syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for CGMA Competency Framework and Professional Skills in Chartered Institute of Management Accountants (CIMA), not a summary of it.

1. 1

   Technical skills

   3 topics

   • Application of accounting and finance
     • Cost transformation and management
     • External reporting and financial management
   • Data and technology fluency
     • Digital mindset and data analytics application
   • Internal control and risk
     • Risk management and corporate governance
2. 2

   Business skills

   3 topics

   • Strategy and market environment
     • Strategic analysis and macro/micro environment
   • Process and project management
     • Project management and business relations
   • Regulatory and macroeconomic context
     • Regulatory environment and economic factors
3. 3

   People and leadership skills

   3 topics

   • Influence and communication
     • Negotiation, persuasion and presentation
   • Collaboration and partnering
     • Business partnering and stakeholder engagement
   • Leadership skills
     • Team building, change leadership and coaching
     • Driving performance and motivation

CGMA Competency Framework and Professional Skills flashcards for Chartered Institute of Management Accountants (CIMA)

25 of 68 cards from the CGMA Competency Framework and Professional Skills deck — real questions with worked answers.

1. What are the four knowledge areas (domains) of the CGMA Competency Framework?

   1) Technical skills (accounting and finance), 2) Business skills, 3) People skills, and 4) Leadership skills — all underpinned by digital skills and ethics, integrity and professionalism.

2. In the CGMA Competency Framework, what central element underpins all four knowledge areas?

   Ethics, integrity and professionalism (with digital skills running throughout), placing the competent finance professional at the core.

3. What are the four proficiency levels used to assess each competency in the CGMA Framework?

   Foundational, Intermediate, Advanced, and Expert.

4. Define 'Application of accounting and finance' as a CGMA technical competency.

   The ability to apply accounting and finance knowledge and skills to support organisational performance — including financial reporting, costing, planning, decision-making and stewardship of resources.

5. What is the accounting equation that underpins financial reporting?

   $\text{Assets} = \text{Liabilities} + \text{Equity}$

6. State the formula for contribution per unit used in management accounting decision-making.

   $\text{Contribution per unit} = \text{Selling price per unit} - \text{Variable cost per unit}$

7. Give the break-even point (in units) formula.

   $\text{Break-even units} = \frac{\text{Fixed costs}}{\text{Contribution per unit}}$

8. What is the margin of safety, and how is it expressed as a percentage?

   It is the excess of budgeted/actual sales over break-even sales: $\text{Margin of safety \%} = \frac{\text{Budgeted sales} - \text{Break-even sales}}{\text{Budgeted sales}} \times 100$

9. State the Net Present Value (NPV) formula for appraising an investment.

   $$NPV = \sum_{t=0}^{n} \frac{C_t}{(1+r)^{t}}$$ where $C_t$ is the net cash flow in period $t$ and $r$ is the discount rate.

10. What decision rule applies to NPV in investment appraisal?

    Accept the project if $NPV > 0$ (it adds shareholder value); reject if $NPV < 0$. When ranking, choose the highest positive NPV.

11. Define the Internal Rate of Return (IRR).

    The discount rate at which a project's NPV equals zero, i.e. the rate $r$ satisfying $\sum_{t=0}^{n} \frac{C_t}{(1+r)^{t}} = 0$. Accept if $IRR > $ cost of capital.

12. Give the Return on Capital Employed (ROCE) formula.

    $ROCE = \frac{\text{Operating profit (EBIT)}}{\text{Capital employed}} \times 100$, where capital employed = total assets − current liabilities.

13. What does the gearing ratio measure, and give a common formula?

    It measures financial leverage — the proportion of debt in the capital structure: $\text{Gearing} = \frac{\text{Debt}}{\text{Debt} + \text{Equity}} \times 100$ (or Debt/Equity).

14. State the current ratio and quick (acid-test) ratio.

    $\text{Current ratio} = \frac{\text{Current assets}}{\text{Current liabilities}}$; $\text{Quick ratio} = \frac{\text{Current assets} - \text{Inventory}}{\text{Current liabilities}}$.

15. What is the Weighted Average Cost of Capital (WACC) formula (debt and equity only)?

    $$WACC = \frac{E}{E+D}\,k_e + \frac{D}{E+D}\,k_d(1-t)$$ where $k_e$ is cost of equity, $k_d$ cost of debt, and $t$ the tax rate.

16. Define 'Data and technology fluency' as a CGMA competency.

    The ability to use digital tools, manage and interpret data, and apply technology to generate insight and drive better business decisions — covering data strategy, analytics, visualisation and digital risk.

17. Distinguish the 4 V's of big data.

    Volume (amount of data), Velocity (speed of generation/processing), Variety (different types/sources), and Veracity (trustworthiness/quality of data).

18. Compare descriptive, diagnostic, predictive and prescriptive analytics.

    Descriptive: what happened. Diagnostic: why it happened. Predictive: what is likely to happen. Prescriptive: what action should be taken. Value and complexity increase from descriptive to prescriptive.

19. What is the difference between structured and unstructured data?

    Structured data is organised in a predefined format (rows/columns, databases), easily searchable. Unstructured data has no fixed model (emails, images, video, social media text) and needs more processing to analyse.

20. In data analysis, what does correlation coefficient $r$ measure, and what is its range?

    It measures the strength and direction of a linear relationship between two variables, with $-1 \leq r \leq 1$. Values near $\pm 1$ indicate strong correlation; near $0$ indicates weak/no linear relationship. Correlation does not imply causation.

21. What is an ERP system and why is it relevant to management accountants?

    Enterprise Resource Planning — integrated software that unifies core business processes (finance, HR, supply chain, sales) into one database, giving real-time, consistent data for reporting, control and decision-making.

22. Define 'Internal control and risk' as a CGMA competency.

    The ability to identify, evaluate and manage risk and to design and operate effective internal controls that safeguard assets, ensure reliable reporting and support compliance and objectives.

23. List the five components of the COSO Internal Control – Integrated Framework.

    1) Control environment, 2) Risk assessment, 3) Control activities, 4) Information and communication, 5) Monitoring activities.

24. State the basic risk-scoring formula used in risk assessment.

    $\text{Risk score} = \text{Likelihood (probability)} \times \text{Impact (consequence)}$

25. Name the four generic risk responses (the '4 T's').

    Treat (reduce/control), Tolerate (accept), Transfer (e.g. insure/outsource), and Terminate (avoid the activity).

See more CGMA Competency Framework and Professional Skills flashcards →

Planning CGMA Competency Framework and Professional Skills for Chartered Institute of Management Accountants (CIMA)

CGMA Competency Framework and Professional Skills (Chartered Institute of Management Accountants (CIMA)) FAQ