Ready to land your dream job in finance? If you are a financial analyst or aspiring to become one, you know that you need to be prepared for your job interviews. Financial analyst interview questions will include general behavioral and technical questions that will assess your level of industry knowledge.
To prepare, check out our guide below with examples of common financial analyst interview questions and answers.
Financial Analyst Interview Questions About Industry Knowledge
An interview for a financial analyst job is going to include questions that skew heavily on industry knowledge. The hiring manager will want to feel confident that you know your stuff and that you might even have the potential to grow in the company long-term.
Check out these top questions and some of the industry terms that you should be ready to discuss.
Which Profitability Model Would You Use When Forecasting New Projects?
This is where you’ll want to flex your knowledge base about profitability and financial models in general. If you think you have the time to do so, mention the different situations in which you would use different profitability models: historical, financial, trends, and analytic.
In this case, you would probably want to suggest using a financial profitability model, since you wouldn’t want to use a historical model when forecasting a new project.
How Would You Define a Cash Flow Statement? What Is a Positive Cash Flow?
A cash flow statement is a financial statement that includes information about all of a company’s cash flow, including ongoing operations and external resources. This is aggregate data. A positive cash flow is when this data shows profit that allows a company to add to its cash reserves that it can then use to reinvest in itself.
You can even give more context by discussing financial statements as a whole and including the cash flow statement as a category. The other two main kinds of financial statements are income statements and balance sheets.
If you get these questions, the hiring manager just wants to make sure that you can accurately and concisely define some basic financial terms and concepts. As a financial analyst, you may have to explain these kinds of concepts to clients or other stakeholders that are not familiar with the finance world.
This is your chance to show that you will be able to explain things in a way that is easy to understand for those not in the field.
Explain Accounts Receivable in Relation to Cash Flow
Accounts receivable is a non-cash account. An increase in accounts receivable represents a decrease in cash flow, and a decrease in accounts receivable represents an increase in cash flow.
Do You Follow the Stock Market? If So, Do You Follow Any Stocks in Particular?
Not all financial analysts are necessarily super tapped into the stock market. It really depends on the kind of analyst position that you are aspiring to.
Financial analysts don’t actually trade stocks, so they don’t have to be complete experts in the same way that investment bankers and stockbrokers should be. That said, they perform financial analysis of data and assess risk based on the markets.
They then make recommendations based on what they find. This means they should be following the stock market to a degree. Depending on the company that they are working for or the client that they are serving, some stocks might be more relevant than others.
General Financial Analyst Interview Questions: Character and Motivation
Let’s start with some general behavioral interview questions you might get about your motivation as an aspiring financial analyst.
Why Do You Want to Become a Financial Analyst?
You should be prepared to explain why you are interested in a profession, no matter what profession it is. During a financial analyst interview, you should be able to tell the hiring manager why you want to become a financial analyst. You might even point to a particular time or moment that led you to pursue the profession.
Why Do You Want to Work for Us?
Be sure to bring up specific points that show why you want to work for the company. This is a moment for you to show you’ve done your research and praise the company. Companies love to be showered with praise and if you truly want to work somewhere, you should find the opportunity during the interview to express your genuine enthusiasm about the company. This question is a chance for you to do that.
This is also a good opportunity to talk about why you’re a good fit for the company. What is about you, your skill set, your professional background, and your personality that would make you thrive at this company? Why should the company want to make you, specifically, a part of its culture?
What Are Your Career Goals? Where Do You See Yourself in Five Years?
Tell the hiring manager about your ultimate career goals. You should be ambitious and explain the steps that you plan to take to get to your goals. A hiring manager will be impressed if you are specific about the ways that you aspire to learn and grow within their company.
When answering questions about more medium-term goals, like the five-year plan, be realistic and ambitious. Detail the kinds of additional skills that you would like to cultivate and describe how you intend to start working your way up the company ladder.
Conclusion: Confidence and Preparation Are Key
At the end of the day, a little interview prep and a healthy dose of confidence go a long way. As a friend or family member to do a mock interview with you a few days before your interview. Then, you’ll have the confidence you need for the main event.