How to prepare for the CMA exam if English is not your native language

Other than Mandarin Chinese, the CMA exam is available in English only, which is an additional challenge if you want to become a Certified Management Accountant and English is not your first language. Let's dive into the challenges facing non-native English speakers and how to overcome them.

Exam Questions Format

The CMA exam consists of MCQ questions and essay questions. The MCQ section of the exam, which presents 75% of the exam, is multiple choice questions; writing, listening, and speaking skills are not required to pass this section. The only important skill is reading and comprehension. The remaining 25% of the exam is the essay section. Even though you must write your answers in English, the examiners do not expect you to have advanced writing skills.

Written response, not essay

A better name for the essay section of the CMA exam is “written-response questions”. In this section, you will be presented with two cases (scenarios), and you will have to answer 8 to 10 questions for each case. Some questions might require mathematical computation, while others will require written explanations, and some will require both. You will not have to write a full essay with an introduction and a conclusion to answer the written response exam questions. You are only required to demonstrate your knowledge about the topic being examined in clear language. The examiners will grade your answers taking into consideration knowledge, organization, clarity, and relevance to the question. Written response question will be 1 or 2 paragraphs for each question.

From the examiners point of view

Examiners are aware that many exam takers do not speak English as their native language. They aim to give you points, not deduct them. You can gain extra points by focusing on clarity organization.

Exam preparation resources

CMA exam review materials use clear and straight forward English. The textbooks are usually easy to follow and understand. PRC’s CMA review study tools include an essay tool that lets you write your answer to the question, then provides a “best answer” that you can compare your answer with. Our “best answers” are written by experts; you can use them as a guideline or benchmark for your writing skills.

Example essay question

Here’s a sample essay question published by the IMA as a free resource:

Grandeur Industries is currently in the process of reviewing capital budget submissions from its various divisions. Grandeur uses the Capital Asset Pricing Model (CAPM) for a variety of purposes, including the determination of benchmark investment returns. The company’s overall cost of capital is 16% and its beta value is 1.2. The risk-free rate is 4% and the expected return on the market is 14%. The following projects from different divisions are under consideration and there is no capital rationing in effect.


Internal Rate of Return

Project Beta














  1. Calculate the required return for all four projects. Show your calculations.
  2. Identify which of the four projects under consideration should Grandeur accept. Support your decision.
  3. Define and explain beta.
  4. Describe four factors that would impact the beta value that is chosen for use in evaluating a project.
  5. Identify alternative approaches to dealing with risk in capital budgeting.


Req 1

The Capital Asset Pricing Model (CAPM) when used in an investment analysis context postulates that the return on an investment should be at least equal to the Risk-Free Rate plus a Risk Premium. The Risk Premium is based on the risk (volatility) of the investment relative to the overall market (as measured by Beta) times the incremental return on the market above the risk-free rate. The model can be expressed as follows;

Required Return = rf + (rm - rf) x β


rf = the Risk-Free rate

rm = return on the market

β= the Beta value for the investment, a measure of risk

For the various projects:

Project A: Required Return = 4% + (14% - 4%) x 1.4 = 18%

Since the Internal Rate of Return (IRR) of 16% is less than the required 18%, the project should be REJECTED.

Project B: Required Return = 4% + (14% - 4%) x 1.6 = 20%

Since the Internal IRR of 18% is less than the required 20%, it should be REJECTED

Project C: Required Return = 4% + (14% - 4%) x 0.7 = 11%

Since the IRR of 12%, is greater than the required 11%, it should be ACCEPTED.

Project D: Required Return = 4% + (14% - 4%) x 1.1 = 15%

Since the IRR of 17%, is greater than the required 15%, it should be ACCEPTED.

The capital asset pricing model allows firms (users) to assess the size of risk premium necessary to compensate for bearing risk. It is a way to estimate the required rate of return on a security or investment. Once the required return has been determined is lets the user know of the expected return from the investment is sufficient to warrant acceptance of the investment.

Req 2

Grandeur should accept project C and D since the both the IRRs of the projects are greater than their required rate of return.

Req 3

Beta = Measure of a stock’s volatility in relation to market.

Market beta = 1

A stock that moves > market, beta > 1; if < market, < 1.

High beta stocks are riskier but potential for higher returns and vice versa.

Req 4

Factors that have an influence on the Beta value for a project include:

  • The industry that the Division undertaking the project is in and its risk characteristics.
  • Experience the division has with similar projects, if any.
  • Ability of the Division to realize estimated returns on projects in the past.
  • Strength of the management team of the division.
  • Level of competition expected.
  • The geographical location of the project. Certain countries are riskier to operate in than others.
  • The degree to which the project involves new technology or unproven operating conditions.
Req 5
  1. Informal method. NPVs are calculated at the firms’ desired rate of return, and the possible projects are individually reviewed.
  2. Risk-adjusted discount rates. Adjusting the rate of return upward as the investment becomes riskier
  3. Certainty equivalent adjustments. Decision maker needs to specify the indifferent point to choose between a certain sum of money and the expected value of a risky sum.
  4. Simulation analysis. Based on different assumptions, computer is employed to generate many examples of results.
  5. Sensitivity analysis. Forecasts of NPVs under different scenarios are compared to each other to evaluate how assumption changes about a certain variable may alter the NPV.

Exam preparation tips

Here are some tips to help you prepare for the CMA exam if English is not your native language:

  • Start early and give yourself more time. Take the time necessary to improve your English language skills and give yourself enough time to get familiar with the material and the exam format. If it takes a native speaker 100 hours of study to prepare for Part 1, you might need 150 or even 200, depending on your current level. This number will improve over time as your language skills improve.
  • Do not try to translate content. Instead, read and understand the material in English.
  • Practice, practice, and practice. The more you get familiar with the exam content and format, the higher your chance of passing the exam from the first attempt.
  • Read the question carefully and make sure you understand the question and the answers before you attempt to answer. CMA exam questions can be tricky, so it is important to take your time and make sure that you understand what is being asked before you answer any question.
  • Stay motivated. The CMA exam is challenging, always remember the goals that drive you to take the exam and what you hope to achieve by passing it.
  • Asking for help is ok. When you struggle with a particular concept, don't hesitate to ask for help from your tutor or colleagues.
  • Practice writing. Ask colleagues and friends to help you with your writing skills by providing you with feedback on your writing skills.

The CMA exam is a tough exam. But with hard work and dedication, you can achieve your goal and pass the exam. Ready to start your journey and pass the CMA exam? Try out our free exam resources here to get started.