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5 Questions You’ll Encounter in an Interview for a Finance Job
Business and Management

5 Questions You’ll Encounter in an Interview for a Finance Job

Get Yourself Ready For Your Next Interview

Many people eye jobs in the financial sector because they find it lucrative. Not only do you get to work in one of the most important departments of a company, but also get to utilize your inherent skills at numbers in your job. If you, like many people, keep scanning the stock market during the course of the day, then a job in finance will give you a profession out of something that you love doing.

However, landing that lucrative job offer is not so easy. The financial sector is undoubtedly a lucrative field to be a part of. Yet, it is also highly competitive. Therefore, you need to ensure that you corner all the attention from the moment you begin the interview. In addition, you will also need to be fluent with answers to all the questions the panel puts to you.

 

The Questions to Expect in an Interview for a Job in Finance

 

Here is a list of some of the difficult finance-specific questions you might encounter during a job interview.

 Q: Narrate an experience about a client you’ve dealt with successfully

  • This question seeks to highlight the way you work with and interact with your clients
  • Prepare a set of anecdotes that illustrate how you saved an account or about the strongest relationship that you forged with a client

 

Q: Walk me through a cash flow statement

  • This question aims at testing your technical proficiency
  • Begin with talking about the net income, before proceeding sequentially to major adjustments such as depreciation, deferred taxes etc., to arrive at cash flows from operating activities
  • Ensure that you cover aspects like:
    • The cash flow from investing activities e.g. asset sales, capital expenditures etc.
    • The cash flow from financing activities e.g. repurchase of debt and equity etc.
    • The total change in cash arrived at by adding all the cash flow sources and,
    • The end-of-period cash balance

 

Q: Define the term “working capital”

  • This question aims at testing your generic knowledge about the industry
  • Working capital is the difference between current assets and current liabilities
  • It provides information on the cash tied up in the business as well as the cash needed to pay off short-term obligations
  • Ensure that you memorize definitions of financial terms, finance industry concepts, and any recent news reports

Q: How can a company show positive cash flows but still be in trouble

  • This question seeks to check your ability to envisage situations
  • Give examples of unsustainable improvements in working capital, where a company sells off inventory and delays payables
  • Also highlight examples that highlight the lack of revenues proceeding through the pipeline

 

Q: How does an act of purchasing an equipment affect my financial statements

  • This question seeks to highlight your competence levels in the domain
  • Start by mentioning that initially:
    • The cash reduces (cash flow statement)
    • The Property, Plant & Equipment (PP&E) increases (balance sheet) and,
    • The purchase becomes a cash outflow (cash flow statement)
  • Move on to the period during the life of the equipment where:
  • The net income reduces because of depreciation (income statement)
  • The PP&E also decreases because of depreciation (balance sheet) and,
  • The depreciation enhances the cash from operations section, as it is a non-cash expense that reduced the net income (cash flow statement)

Read More

Want to know more about a career in finance? Read Top 10 Careers in Finance You Should Know About. 

Pro-Tip

Interested in learning more about finance to see if it may be a suitable career option? Take out Fundamentals of Finance course! You may also want to take a look at our Fundamentals Of The Stock Market and learn the Stock Market Basics.