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Top 7 Financial Analyst Interview Questions & Answers

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3rd Jan, 2022
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Top 7 Financial Analyst Interview Questions & Answers

In management or finance, one of the most sought-after careers is that of an analyst. The primary role of a financial analyst is to go through available data, which helps them find feasible business opportunities and assess outcomes for effective business strategies. An employee can secure this job in a junior or senior aspect in one particular company or firm. 

Junior financial managers majorly deal with gathering the required data, overseeing financial modeling, and maintaining spreadsheets accordingly. Senior business analysts are more invested in developing investment strategies, marketing ideas, and communicating with company management teams and other investors. 

Given the constantly shifting global marketplace and uncertain economy, there is an evergreen requirement for finance managers. 

If you are a professional who is looking for a suitable job in the field of financial analysis, this article will help you prepare for the different interview stages in the selection process. We’ll be listing some of the most commonly asked finance manager interview questions that revolve around career goals, the finance industry, and relevant job expertise and giving you tips on how to answer them.

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8 Frequently Asked Financial Analyst Interview Questions

1. Why do you want to be a financial analyst? What drew you to the role?

This is a question that candidates can expect at every level in the selection process of a financial analyst. Potential employers are mostly invested in learning where a candidate’s passion lies, from a professional point of view. It includes their motivation to pursue the field, their interest in the concerned job, and factors that led them to the field of finance.

Most importantly, they want to find out what new, authentic, practical, and refreshing aspects you can bring to the table on getting the job, which will directly benefit the company or firm. 

It is wise to talk about the journey that led you to the field of finance by making it clear to them what exactly you expect from the job, how it is a step towards fulfilling your ultimate career goals, and what new you would add to this role if you get recruited.

2. Why do you wish to work at our company?

Your interviewers will most definitely ask what attracted you to their company and why you wish to pursue that specific job role. 

So, researching about the organization and applying that knowledge when answering interview questions will set you up for a positive impact. Let them know what you find most unique about the company and whether the culture, work-life balance, quality of work, etc., appeal to you. Tell them what excites you the most in the company or firm.

They’ll also appreciate clarity on your part for knowing which branch of financial analysis suits you the best, given there is a broad range of positions and roles in the field of finance. Try to convince them why you took up financial analysis and how their company can help you realize your career goals. 

3. Do you prefer to work alone or in a team environment?

In most financial positions, collaborating and being able to function as an influential team member is required. If the company works on a collaborative basis, disclosing the fact that you are more comfortable working alone during your interview may slim the chances of you getting recruited. 

However, there is no right or wrong answer per se when it comes to questions like these. For example, some companies value the ability to take up independent responsibilities. In contrast, some companies prefer people who can collaborate with others to bring out the best version of combined strategies and suggestions. 

In any case, giving examples of times when you’ve worked alone or in a group will work in your favor.

4. Which profitability model would you use to determine if a project will be profitable?

This is a question where the recruiter will observe and analyze how you go tracking the success of a particular project. They will focus on the steps you take to reach point B from point A. 

This may include looking at revenue streams and looking at costs that might be associated with the profitability model you outline. So, you should be able to crunch the net present value accurately and discount cash flows to seal an excellent impression on the recruiter. 

The company may give you a special hypothetical problem to solve and observe how you come to the solution. In such a situation, try to remain calm and analyze the problem objectively before jumping to conclusions. Ask clarifying questions if necessary to get a better understanding of the scenario. 

5. If you could pick one financial statement to decide on a company, what would you choose?

Any recruiter will try to get a good sense of a potential candidate’s ability to understand the concerned company’s crucial financial statements. They will most likely ask you to explain an income statement, a balance sheet, a report of a shareholder’s equity or cash flow. 

It is essential to highlight that you are aware of these statements and have a clear understanding of when and how to use them. You can empathize with the most suitable financial statement but make sure you also explain why you think that is the most suitable source of information. Also, highlight why other financial statements are not befitting for the same.

If possible, cite an experience where you were in a similar situation in the past and had to rely on a particular statement to base critical financial decisions for your company. 

6. What is the single best evaluation metric for analyzing a company’s stock?

Recruiters seek to get a close look at the candidate’s thought process when they try to compare and contrast different evaluation levels. It is important to demonstrate that you are familiar with multiple financial concepts regarding stock valuation.

Make sure they know that you understand the positives and negatives of various methodologies and can manage them. 

It is wise to explain to the recruiter your reasons for choosing a particular metric. Let them know that your choice of the evaluation metric will help you gain an in-depth insight into the stocks and will ultimately assist in evaluating the company.

7. Share a personal experience where you had to present financial data.

The answer to this question will give your interviewers an insight into your communication skills and showcase your expertise in demonstrating presentations. 

It is an important attribute to hone since most financial analysts are frequently tasked to present financial data to the company leadership or other associated parties. 

Your interviewers will want to know how you prepare and present said data and if you can authenticate that data or need external information to bank on. They will also test your level of comfort and ease in speaking in front of senior company executives. 

The ideal way of going about this answer is to apply the very effective STAR method. It simply means situation, task, action, result. This method comprises setting the basic scene, then describing your role in the specific situation, explaining the steps you took along the way in excruciating details and enhancing the outcome of those decisions. 

It is essential not to miss out on any facts or data when presenting your previous experience to your employer.

8. Have you considered pursuing licenses, credentials, and certifications if you haven’t already acquired them? How do you think they can help you in the professional context?

A financial analyst can pursue a wide range of credentials, certifications, and designations. They include Chartered Financial Analyst (CFA), Certified Fund Specialist (CFS), and Chartered Financial Consultant (ChFC). 

When a recruiter looks into your credentials and certifications, they expect you to explain your motivation to acquire additional training and how you are using them regularly to make your work more relatable and effective.

Flourishing organizations are always interested in finding out how dedicated you are and willing to further your education and skills, which you ultimately apply to devise strategies and benefit their firm. 

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For example, having been certified as a CFA shows the company that you understand the business at its core and can go through the rigorous work engagements the job will entail. While answering this question, you should individually provide a context outlining the reasons that led you to pursue these additional certifications or if you plan to acquire them in the future. 

If you want as ECE your career with a coveted certification, we recommend you apply for a seat in upGrad’s Master of Business Administration (MBA) from Liverpool Business School and IMT Ghaziabad. The 18-month course comprises six core specializations, including Marketing, Finance, Operations, Strategy, and Analytics. The curriculum is taught by world-class global faculty and includes 10+ case studies from Harvard Business Publishing to help you future-proof your career in finance.

Reach out to us today to book your seat! 

Profile

Karan Raturi

Blog Author
Karan Raturi is the General Manager of upGrad North America. He has also led various finance, strategy, and operations teams at Wayfair, Kurt Salmon, and IBM.
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Frequently Asked Questions (FAQs)

1What exactly do recruiters look for in financial analysts?

If you are appearing for an interview for a financial analyst’s profile, remember that your interviewers are essentially evaluating you on your basic understanding of business, planning skills, and the knack to deal with financial models. They also want to get insight into your ability to handle and maintain complex finances and devise innovative strategies.

2What are the specific set of skills and abilities a financial manager should possess?

A suitable candidate must have excellent analytical skills to begin with. Logical and analytical thinking about various financial information varying from a company’s financial statements to industry news should come very quickly and naturally to them within a short period.

3How to prepare for financial analyst interview questions?

Here’s how:

1. Begin with researching the company and job role
2. Gain knowledge on key concepts
3. Go through frequently asked interview questions
4. Keep aside a list of experiences to include in your answers
5. Practice interviews through mock sessions.

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