Comparing Apples to Oranges: CFI vs. FMI (Part 2. FMI Review)

Comparing Apples to Oranges: CFI vs. FMI (Part 2. FMI Review)

By Andrew Grigolyunovich, CFA, CFM and now FMVA

FMI Review is the second article in the series of reviews of CFI and FMI designations. If you have missed the first part of the blog, you can access it here: PART I – Comparing Apples to Oranges: CFI vs. FMI (Part 1. FMVA Review). Otherwise, enjoy the moment below.


FMI Review – the Only International Financial Modeling Certification

18 years ago I started my studies for a CFA charter and this investment of time and money paid back to me multiple times. When FMI announced a similar designation for financial modeling I thought that it will be a very good idea to qualify for it.

Things you can bring with you on the exam is only… brain

Indeed, FMI’s qualification is built on very similar principles as CFA Institute’s exams. It is a 3-level program with on-site exams taking place twice a year. The exams are closed-book and are administered at testing centers throughout the world. 4 hours are allocated for the exam and still there is a significant time pressure. I recall that my 3-statement model at the AFM level balanced out only 5 minutes before the deadline. Read more about my AFM exam experience in another blog article here.

You have to rely on your own knowledge and you can’t even bring your own computer to the testing room. FMI provides the computers in order to keep the exam as rigorous as possible. You can only bring your own keyboard and mouse. However, the equipment at test centers is very good.

The topics covered by the program become increasingly complex from one level to another. The AFM exam tests the candidate’s ability to create a 3-way financial model and supporting schedules, the basis for any further  advanced projections. CFM then tests more advanced financial topics except company valuations etc. Finally, the most advanced body of knowledge is required for the MFM level.

Key difference from FMVA

There is one key element you need know to better understand the differences between CFI and FMI. From the very beginning FMI has purposefully distanced themselves from the training course providers. When the designation was launched, there was a growing demand and an empty field for the CFA-type designation emphasizing financial modeling. FMI has taken the niche as a global certification provider for the industry. Therefore, in order not to become yet another training course provider and in order to cooperate rather than to compete with many training course providers that are available on the market, FMI focused on certification rather than on training as such.

Comparing Apples to Oranges: CFI vs. FMI (Part 2. FMI Review)

So, FMI’s programs provide the required body of knowledge and rely on the candidate discipline. Previous year exam questions and practice questions are provided to the candidates but it is their responsibility to structure their learning process. The candidates have to either self-study or to take specialized courses from independent prep-course providers. FMI has a long list of approved training providers (ATPs). However, most of these ATPs cover the AFM program only (Level 1). I expect that CFM level programs will appear when more people successfully pass AFM exams (Level 1).

Can you pass the FMI exam?

In my opinion the major advantage of FMI is the rigorousness of the exam process. Their exams are very similar to CFA Institute, the golden standard of the financial industry. The exams are held twice a year, only in person inside the testing centers around the worlds. The exams are closed-book and they provide significant time pressure. Not only you have to know the topics covered in the exam, but also have to know it very well to quickly construct the required financial model.

I personally know a couple of very strong modelers who had to take the CFM exam a couple of times before earning the designation. I am sure that anyone who gets up to this point is a very strong financial modeler indeed.

Another advantage of the program is that the exams are being graded by people. FMI’s exams do not rely on multiple choice answers and the overall quality of the financial model is being evaluated. For example, on the AFM exam, instead of trying to get the same correct answers from everyone, FMI lets the candidates create their own scenarios and choose assumptions themselves. The correct flow of data in the model, the right choice of assumptions, the layout of the model and many other parameters are evaluated instead. Just like in real life – your model not only has to give the right results but also to be user friendly and to incorporate different scenarios. All of these factors are being graded at FMI.

-Does anybody in the room have the complete FMI certification?
-Hm…probably, not

Comparing Apples to Oranges: CFI vs. FMI (Part 2. FMI Review)

As for the drawbacks of this FMI review, the key disadvantage is a relatively small number of candidates at the Master Financial Modeler Level (MFM,Level 3). There is no problem with the AFM level program. It is well-demanded and there are probably hundreds or thousands of candidates. But not so many people have the right to sit for the Level 2 and Level 3 exams. In addition to that, while CFI gained momentum due to COVID19 as more people spent time studying online, FMI, on the contrary, had to move the in-person April exams to October this year.

Anyway, in the long run it is very positive for the designation – only the most qualified people are able to get the designation. However, in the short term it just doesn’t make sense for FMI to create Level 3 exams as long as the number of candidates is not large enough. It also doesn’t stimulate ATPs to create specialized study courses for the advanced levels, so, I expect that most of the people on levels 2 and 3 will be relying on the self-study and the experience that they already have.

FMI promises to launch MFM level in 2020 and I am sure that many CFM charterholders can’t wait to test their skills. This promises to be the black belt of the financial modeling industry and I wonder what’s going to be the passing rate there.


So, summing up my FMI review, as the key advantages I would mention the value of the program and its rigorous testing. If you are a hiring manager and you have a candidate with a designation from FMI, you could be sure that he is a good financial modeler.


Comparing Apples to Oranges: CFI vs. FMI (Part 2. FMI Review)

The key drawback of FMI at this point of time is that there are not too many candidates for the advanced levels of the program. It could be an honor to those who have already passed these levels. Yet the aspiring candidates have only to rely on their experience or self-study. The choice to distance from the prep course providers poses additional challenges for FMI. Training course providers will start making the courses only when there are enough candidates and the demand for these courses is large enough.


… To be continued.

P.S. This is the second article in the series. After completing the whole article I’ve understood that there is too much feedback I could give on both programs. The initial blog article grown to 6 single-space pages in Word.

As a result, I decided to split it into 3 parts. The first one was published last week and it covers FMVA program from CFI. The second one is published today and that’s my review FMI review. Finally, next week I will publish a comparison between the 2 programs. What program is right for you at different stages of your career? Which on to choose and under which circumstances? I will try to answer these questions in the final article of these series.

Stay tuned until the next week. Meanwhile, I encourage you to follow me on LinkedIn or invite me to connect. Then you won’t miss the next part of this article. I also publish other interesting blog posts on financial modeling.

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