Interviewing can be unnerving. Prepping for interviews is a job on its own, but if you prepare the right way, then you will find the interview easier to get through and feel excited about your potential. Part of that process includes knowing which interview questions may come up and how to answer them. Here are a few to help you as you get ready for your interview!
1. Why did you choose a career as a financial analyst?
This question requires you to be introspective and take a close look at why you have picked this path. Keep your answer to what is required of an analyst and sew that into your reply, for example, “I decided to pursue a financial analyst career because I am a keen problem-solver with an analytical mindset. Additionally, my attention to detail is well-suited to review numbers, identifying patterns, and finding solutions when something appears to be amiss. Finally, I find the work engaging and appreciate the value I can provide to my employer by excelling in this kind of role.”
2. When you spot an inconsistency in a company’s financial records, what do you do?
This question is often asked to give the company a peek into how you problem-solve. Try to find an example of when you came across this problem before and how you handled it, and if you haven’t had this issue yet, how would you handle it. For example, “I began or would begin by reviewing the available records to identify where the funds may have gone. While it’s a major undertaking to reconcile the data, that’s what’s required of us.” If you are using a past experience, explain what you did next, “Ultimately, I discovered that a record had been duplicated, causing the same amount of money to be removed twice. I was brought this to the attention of my supervisor and was able to get the income statement corrected.”
3. Why do you want to work for this company?
A company is looking to see if you know enough about where you are interviewing. Did you do your research ahead of the interview? What are their values, their mission statement? Think about what attracted you to apply with them specifically. If you did your homework, you can answer this question easily.
4. When conducting an analysis, which financial methodologies do you favor?
This question is obvious—a company wants to see if you know the fundamental principles of finance. There are several ways to analyze a statement, including horizontal and vertical analysis (which are two of the most common methods.) Make sure you know all the methodologies and which ones you favor, and why.
5. What is EBITDA? What isn’t included in EBITDA?
This question is critically important and a big part of the work of a financial analyst. First, understand the acronym: Earnings before interest, Taxes, Depreciation, and Amortization. It’s a measure of a company’s overall financial performance and is used as an alternative to net income in some circumstances. An EBITDA can be misleading because it strips out the cost of capital investments like property, plant, and equipment. This metric also excludes expenses associated with debt by adding back interest expense and taxes to earnings.
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