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Finance Manager Mock Interview

Question 19 of 25 for our Finance Manager Mock Interview

Finance Manager was written by on January 1st, 2021. Learn more here.

Question 19 of 25

What are some benchmarks that you compare actual results to when completing monthly analysis?

When analyzing actual results, a Finance Manager should compare to benchmarks. Most commonly, comparisons will be to last year actuals, budget and prior forecast. Actual vs forecast should theoretically have the lowest variances, as it was built off the most recent information. Actuals vs last year may have some 'noise' - variances from big items that occurred last year but not in current year, or vice versa. The current year budget may or may not have accounted for this 'noise'.

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How to Answer: What are some benchmarks that you compare actual results to when completing monthly analysis?

Advice and answer examples written specifically for a Finance Manager job interview.

  • 19. What are some benchmarks that you compare actual results to when completing monthly analysis?

      How to Answer

      When analyzing actual results, a Finance Manager should compare to benchmarks. Most commonly, comparisons will be to last year actuals, budget and prior forecast. Actual vs forecast should theoretically have the lowest variances, as it was built off the most recent information. Actuals vs last year may have some 'noise' - variances from big items that occurred last year but not in current year, or vice versa. The current year budget may or may not have accounted for this 'noise'.

      Written by Brian Schuchart on January 1st, 2021

      Answer Example

      "There are three benchmarks that I typically use to analyze actual results. The first benchmark is vs last year. Actuals vs last year will help explain growth and decline in various accounts vs the previous year. Many external parties, such as investors, are interested in performance vs last year. The second benchmark is vs budget. At the beginning of the year, we built the annual budget which essentially lays out targets for the year. Each month, we want to analyze how we are doing vs budget so that business practices can be adjusted in order to realize full year budget targets. The third benchmark is vs prior forecast. Each month we prepare a forecast for the remainder of the year, and we use this benchmark to analyze how close actuals came to our expectations."

      Written by Brian Schuchart on January 1st, 2021