Financial analysts play an important role in helping organisations make important financial decisions which are also backed by relevant data. Financial analysts have a wide range of responsibilities and are generally responsible for financial planning and analysis of a business. Financial analysts use analytical tools to find out hidden information from tons of financial data that can help organisations to make more informed decisions.
They also help to predict and forecast the performance of businesses and help to identify the most profitable investment opportunities. The demand for financial analysts is on the rise as companies are getting more dependent on data analysis for business decision making. Aspirants are often confused about the best course of action for their career as an analyst in the finance segment. It is a subjective matter and requires an assessment of one’s skills and strengths along with the academic and personal qualification.
One can easily opt for a financial analyst course by reputed institutions like Imarticus Learning to learn and obtain practical knowledge from textbooks as well as experienced professionals. It also guarantees job opportunities with some well-known organisations in the industry. One of the most important aspects of landing a good job is being interview-ready. Let’s take a look at some of the most relevant interview questions that you should prepare for before you sit in an interview for the role of a financial analyst.
- Why do you want to be in this profession?
One of the most common and important questions that you will be asked in your job interview is your reason to be in this profession. You should be able to convince your interviewers that you are passionate about this job and you should be clear about what you want to achieve with this role. Knowing your ‘why’ is one of the key factors that could help you get your dream job.
- What is EPS and how is it calculated?
EPS stands for Earnings per Share; it can be explained as the amount of income generated for each share of the company. To calculate earnings per share the preferred dividends paid are subtracted from the total net income. Now the earnings would be divided by the total number of outstanding shares on the balance sheet.
- What do you know about financial modelling?
Financial modelling can be explained as a quantitative analysis tool that helps to figure out asset pricing and assists with other general financial analysis. It is used to make predictions regarding the future based on the historical and present financial records of the organisation. It also helps with a business valuation, budgeting and strategic planning.
- What are the main components of a cash flow statement?
A cash flow statement helps us to understand the cash flow position of the business. It gives detailed information regarding the cash flowing in and out of the business. There are three main components of the cash flow statement; it includes cash flow from operating activities, cash flow from investing activities and cash flow from financing activities.
- Give us an example where a company has positive cash-flow but it is not financially sound.
One such instance could be a company selling off inventory but delaying amount payables.
- What are some important tools for used by technical analysts for analysing a company’s stock?
While conducting technical analysis, analysts generally use line charts, bar graphs and point charts to assess the performance of a company’s stock.
- What do you understand by cost accountancy?
Cost accountancy is the application of cost accounting principles and guidelines to calculate the cost of production by identifying the fixed and variables cost associated with the manufacturing of products. It is a branch of managerial accounting that helps in the decision making process for the business.