Interview Questions & Tips For The Role Of Financial Analyst

Financial Questions

1. What are the different ways of valuing a company?

2. Can a project have positive IRR and negative NPV?

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3. What is the formula for WACC and where is it applied?

4. What is CAPM?

5. What is the difference between Enterprise Value and Equity Value?

6. How do you calculate Free Cash Flow to the Firm?

7. How do you calculate basic Earnings Per Share?

8. What does capital structure mean?

9. What advantage does debt provide over equity?

10. What are the four main items in Other Comprehensive Income?

11. Why is quick ratio of a company lower than current ratio?

12. What is your understanding of working capital?

13. What does the DuPont model measure?

14. Name two industries with negative cash conversion cycle.

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15. What is LIFO reserve?

16. Describe few aspects of a company (including ratios) that a bank would look at while evaluating it for debt?

Behavioural Questions

1. What are the issues that you have faced while working in a team? How did you deal with them?

2. Share a situation when you had to deal with a difficult person in the team? How did you handle the situation?

Tip: Do not focus too much on the negative aspects of the person.

3. Have you ever strongly disagreed with your manager? How did you handle the situation?

Tip: It is fine to have a difference of opinion, however the key over here is how the situation was handled.

4. Share an experience when you were overwhelmed with multiple responsibilities that had a strict deadline. What steps did you take to cope with the situation?

Tip: Ability to prioritize is key here.

5. What are three strengths and weaknesses about you? What are you doing to overcome the weaknesses?

Tip: Try and restrict the answer to professional domain.

6. Share an experience where you presented to a group? How did you prepare for it and how did it go?

7. Give an example where you thought outside the box?

8. Provide an example of when you faced an obstacle in life, how did you overcome it?

9. Share an instance when you took initiative to complete an important task?

10. Describe a situation where you successfully persuaded another person to change his / her view of thinking?

Tip: Do not mention instances where you persuaded your own family members.

11. Share a situation where your patience was tested, how did you keep your emotions in check?

Tip: A candidate with stable personality is always preferred over someone who is unpredictable.

Questions from your CV

1. Walk me through your CV?

Tip: Restrict the introduction to 2 mns. Start with either academics or work experience and walk through in chronological order.

2. Be prepared to talk in detail about anything that you have mentioned in your CV

Tip: You should be able to explain each and every word mentioned on your CV. If you are unsure about anything, do not include it in your CV.

3. Be prepared to explain any time gaps between jobs.

4. What are the objectives that you have set for yourself in the past? What steps did you follow to achieve the same?

Tip: Try and stick to professional or academic objectives. Personal objectives related to sports / fitness / learning new things are palatable in certain instances.

5. What hobbies do you have? / Do you like to play any sport? / What do you do in your free time?

Tip: Do not mention watching TV, surfing the net or hanging out with friends. If you actively play a sport, definitely mention that.

Questions About The Company

1. What do you know about our company?

Tip: Research the company well before the interview, through online resources and by talking to people who are working or have already worked with the company.

2. What do you know about the industry / competition?

3. Why do you want to work with our company?

4. Why should we hire you?

5. Can you suggest any improvement in the company based on what you know or have seen so far?

Tip: Be careful, do not point out any shortcomings. Mention only something that can be improved.

Check out our article on Job Search Strategies for CFA candidates