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Fintech Financial Analyst Interview
Questions

24 Questions and Answers by
| Marcie is the principal and founder of CopyHawk, a company that offers editing, writing, and career coaching services. She loves to revamp client resumes so they can land the job of their dreams.

Question 1 of 24

Describe how you would develop an investment recommendation for company decision-makers.

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Fintech Financial Analyst Interview Questions

  1. 1.

    Describe how you would develop an investment recommendation for company decision-makers.

      It's important that in answering this question you walk the interviewer through the steps you would take in this situation. They want to understand your process. Discuss the information you would need to gather, the stakeholders you would have to take into account, and what thresholds would deem the investment too risky.

      Marcie's Answer

      "Over the past several years, I have developed and honed a process that I typically follow when I'm asked to come up with a recommendation for company executives. I start by determining what the end goal of the investment is according to the company decision-makers and make sure that I'm clear on any requirements or limitations. For example, does there need to be a quick ROI or does the investment include an acquisition? I also identify and consider what thresholds exist that might deem the investment too risky. Next, I pull together all the financial statements that are needed for me to make decisions. These can include the company's balance sheet, income statements, and cash flow statements. Sometimes I need to generate these documents or updated versions of them. In the end, I make sure that I provide several options for the executives to consider."

  2. 2.

    What was your greatest achievement in your last role?

      You can choose to talk about whatever accomplishment you'd like, but plan to connect it to the skills and personality traits that the interviewer is interested in seeing. Some skills you might choose to highlight include being a self-starter, problem-solver, and strong communicator, in addition to being analytical and/or collaborative. Also, be sure to share the credit if you worked with a team.

      Marcie's Answer

      "I'm most proud of how I evolved in a leadership capacity during my last role. When I started out, I didn't have much experience under my belt, but after a few years, I was able to establish myself as a mentor to some of the newer team members. They started coming to me with questions or to check their models and reports. In one instance, our manager implemented new software for financial modeling, and I was able to quickly pick up on it and then ended up training the rest of the team. I look forward to continuing to hone my leadership skills within a new position because I really enjoy helping and managing others."

  3. 3.

    Tell me what you know about different valuation methods.

      Financial analysts are frequently called upon to determine the valuation of a company or asset. There are various ways to do this, and the interviewer wants to know that you are aware of these different methods. Talk through the valuation techniques you're familiar with, and, if possible, give examples of times when you've used them in the past.

      Marcie's Answer

      "There are several different ways that one can determine the valuation of a business or asset. Since I've been a financial analyst in the fintech field for several years now, I've had the opportunity to use three methods in particular: cost approach, market approach, and the discounted cash flow approach. The cost approach takes into account what it costs to rebuild or replace an asset, which can then be used to value a stock. The market approach, meanwhile, relies on public company comparables and precedent transactions. Finally, the discounted cash flow approach forecasts future cash flows and then discounts it back to today at the company's weighted average cost of capital (WACC). It's the most detailed approach but many times its outcome is the most accurate."

  4. 4.

    What process do you use to create a financial analysis report?

      One of the primary job responsibilities of a fintech financial analyst is to put together financial analysis reports that highlight the financial strengths and weaknesses of a business. Walk the interviewer through the steps you typically take to produce this type of report.

      Marcie's Answer

      "The process I've developed over time to generate a financial analysis report starts with gathering the information I need from the company's financial statements, which usually includes its income statement, balance sheet, and cash flow statement, as well as quarterly and annual records and financial notes. Next, I work on calculating ratios like ROI to show the company's financial health, and then I conduct a risk assessment. Finally, I estimate the value of the business and its stock. When I assemble the report, I typically include a company overview, an investment analysis (reviewing the company's cash flow, liquidity, and debt levels), a valuation section, a risk analysis, details, and a summary."

  5. 5.

    What kinds of tools do you use for advanced financial modeling?

      Given that financial analysts spend a lot of their time building financial models, the interviewer wants to know what kind of tools and programs you use to do this. For many analysts, the program of choice is Microsoft Excel. If this is the case for you, consider talking about some of the various functions you use within Excel for modeling. If you use other tools, let the interviewer know.

      Marcie's Answer

      "Almost exclusively, I use Microsoft Excel when I build financial models. Other the years, I've learned how to best use the program; it has many different capabilities when it comes to modeling. In one of my earlier jobs, however, I did have the opportunity to use Quantrix for a while, which is a forecasting and modeling software platform in the cloud. I liked using it but have since reverted back to using Excel in most cases. A few years back, I took an online course that really solidified my knowledge of how to use Excel effectively for modeling. If you decide to hire me, I can definitely carry out any necessary financial modeling using Excel, but I'm also a quick learner, tech savvy, and capable of easily learning another modeling program or tool if needed."

  6. 6.

    What financial statement would you pick to make a decision about a company?

      It's important that a fintech financial analyst be familiar with and understand when to use various financial statements, including income, shareholder equity, and cash flow statements, as well as balance sheets. Talk to the interviewer about which financial statements you would use in different scenarios and why.

      Marcie's Answer

      "If I had to pick one financial statement to use to make a decision about a company, I would choose the cash flow statement. Unlike the balance sheet, which shows the assets and debt of a company at a specific point in time, a cash flow statement shows liquidity and how a company is using and generating cash, which is helpful in determining how the health of the company is currently. On the other hand, I would use an income statement to compare year-on-year and quarter-on-quarter performance and a shareholder's equity statement to see what's been paid into the company and what exists net of assets and liabilities."

  7. 7.

    Why did you choose to become a fintech financial analyst?

      The interviewer wants to know your reasons and motivations for becoming a fintech financial analyst. Discuss what led you to pursue this career path and where you see yourself going in the future. Emphasize the soft skills and enthusiasm you have that make you a good fit for this career. It's also a good idea to mention why you're interested in the fintech field.

      Marcie's Answer

      "I've always been analytical and someone who enjoys math and numbers. So by the time I went to college, I knew I wanted to do something in the financial field. I felt pulled between becoming an accountant or a financial analyst. Ultimately, I decided that being a financial analyst appealed to me more because I enjoy making predictions about the future. I like the idea that I can help direct the course of the company and the business. So I see myself staying in this type of role going forward because it really suits me. Also, working for a fintech startup like yours as a financial analyst really excites me because I know I'll be able to directly see the impact of my work."

  8. 8.

    Describe a time when you had to present financial data to others.

      Many times fintech financial analysts have to present financial data to others, including company executives and high-level clients. The interviewer is trying to gauge whether you've done this before or not. If you have, use the STAR method (situation, task, action, result) to talk through an example of a presentation you gave, what your role was, how you prepared and carried out the presentation, and what the outcome was. If you haven't done this before, be honest but express how willing and eager you are to do so in the future.

      Marcie's Answer

      "I have presented various types of financial data to executives and clients before. This is a skill I've had to teach myself because although I have always had a knack for numbers, talking in front of others took practice. Over time, I have become skilled in this area, however, and even enjoy doing it these days. Within my current role, I had to build a predictive financial model to show where the business would be in five years. Going into the project, I determined what numbers were most important to the executives in my company. After I had built the model and had taken feedback from colleagues under consideration, I created a slide deck with my conclusions and recommendations. I then presented my model and slides to the decision-makers in my company who of course had some follow-up questions. In the end, they decided to adopt several of my recommendations and commended me on the presentation itself."

  9. 9.

    What is NVP and why is it important?

      You can expect to be asked several questions that test your financial knowledge. Familiarize yourself with this kind of information before the interview so you appear capable and competent. You will want to show that you are an expert when it comes to financial concepts and terminology.

      Marcie's Answer

      "NPV is a financial metric that stands for Net Present Value. It takes into consideration the time value of money, translating future cash flows into today's dollars. As a financial analyst, I frequently calculate ROIs for potential projects and expenditures; NPV is a method that calculates the ROI by looking at the money you expect to make and converting those returns into today's dollars so you can tell whether the project or investment is worthwhile. NPV is important because it takes into account the fact that the buying power of today's money is greater than the same amount of money in the future, thereby allowing a financial analyst to determine the total value of a potential investment opportunity."

  10. 10.

    Do you have any experience benchmarking?

      Explain to the interviewer what benchmarking is and then talk about any experience you have doing it. If possible, cite examples. If you don't have any experience in this area, emphasize that you are willing and eager to learn.

      Marcie's Answer

      "There are many different situations when benchmarking might be used by a financial analyst. For example, I know that competitive benchmarking is sometimes used when a company wants to assess its position within its industry or when it needs to determine performance targets (by looking at the performance of industry leaders). Sometimes companies also use benchmarking for internal purposes too. In this case, it is usually done to share best practices throughout the company. Personally, I have used prior year financial statements as benchmarks for comparing the current year's financial statements. When I do this, I compare the financial ratios between statements, which helps me to see how the company is performing year over year."

  11. 11.

    What four financial statements are used to monitor a company's financial health?

      During the interview, you will inevitably be asked several questions that test your financial knowledge. Brush up on this type of information before the interview so you come across as capable and competent. The interviewer wants to feel confident that you are an expert when it comes to financial concepts and terminology.

      Marcie's Answer

      "There are four main financial statements, which include balance sheets, income statements, cash flow statements, and statement of shareholders' equity. The balance sheet shows a company's assets, liabilities, and equity (the difference between the assets and liabilities). The income statement is also called a profit and loss statement, and it tracks how a business' net revenue translates into earnings. Meanwhile, the statement of cash flow shows how cash is moving in and out of the business, while the statement of shareholders' equity reports changes in the value of the shareholders' ownership interest in the company."

  12. 12.

    What do you do when you don't have all the information you need for a project?

      This is the interviewer's way of finding out how resourceful you are. When confronted with an obstacle or a lack of information some people will just give up or run to someone else for the answers. Explain to the interviewer that you will logically think through different ways to find the missing data on your own before going to your manager. Show that you can think outside of the box to solve problems. If possible, cite an example.

      Marcie's Answer

      "I consider myself a creative problem solver, and if the situation ever arises where I don't have all the information I need for a project, I calmly brainstorm ways to locate the data myself. I'm not opposed to asking questions if needed, but I am a strong believer in relying on myself first and foremost, and I don't like to waste anyone else's time. Occasionally in the past, there have been times when information is missing when I'm conducting a financial analysis. I know that there are a variety of ways to gather this information so I begin by thinking through the options. Many times I can contact the client directly and politely ask for the missing information. Sometimes I'm able to look at the customer's transactional history and filter out the data I need. Other times, I dig through files or work with the accounting team to find the past results or reports that I need. Whatever the case, I strive to be self-sufficient, resourceful, and a problem-solver in every instance."

  13. 13.

    What is your greatest strength that benefits your career as a fintech financial analyst?

      Interviewees frequently hear the 'what's your greatest strength' question during an interview. In this case, however, the interviewer wants you to connect one of your strengths to the fintech financial analyst role in particular. Discuss a strength of yours and how it will specifically help you to excel in this role.

      Marcie's Answer

      "I'd say that one of my biggest strengths is my ability to communicate effectively with others, which is helpful within this role for several reasons. First, since I'm personable and a strong verbal communicator, I tend to work well with others in a team environment. Second, I'm also able to take numbers, trends, financial models, and graphs and communicate them in such a way that non-analytical folks are able to easily understand my takeaways and recommendations. And I can do this whether it's via a presentation or a written report. So while I have many strengths that complement the fintech financial analyst role, I believe that my capacity to communicate well with others is the one that benefits my career most."

  14. 14.

    How would you handle an unhappy colleague or executive in a business meeting?

      There may be times as a fintech financial analyst when your recommendations aren't welcomed. In many cases, you will be suggesting that the company make changes and not everyone loves change. The interviewer wants to know how you would handle this kind of conflict. Discuss how you will remain calm and look to diffuse the situation. If possible, throw in a real-life example of when you've successfully done this before.

      Marcie's Answer

      "When I put forth recommendations, they are backed up by the financial models and statements that I've built and gathered. I don't make random suggestions, so, in other words, I believe in what I'm proposing, and I'm willing to stand up for it. Having said that, I respect that people might have different opinions. If a conflict arose, I wouldn't let it derail the entire meeting. I would address the person's concerns within the meeting in a friendly and non-judgmental way, supporting my assertations with data. If the discontent continued, I would request to meet one-on-one after the meeting so we could share our perspectives without an audience. Ultimately, the final decisions aren't made by me, so if all the decision-makers aren't on board, I might go back to the drawing board and look to modify and improve my recommendations."

  15. 15.

    Tell me about a time when you had to meet a tight deadline. How did it go?

      There may be times as a fintech financial analyst when you're put under pressure or stress. The interviewer wants to know how you would handle this type of situation. Use the STAR method (situation, task, action, result) to outline a time when you had to deal with a strict deadline. Explain the situation, your role in it, what you ended up doing, and the outcome.

      Marcie's Answer

      "Recently, I was told that I needed to put together a presentation with recommendations for a client. The deadline was very tight, which created some stress because I was concerned about having everything done, accurately, prior to the presentation date. To help alleviate the stress, I chose to come into the office early for several days so I had some extra time to work without the interruption of people around. I also delegated some of the more tedious data-gathering tasks to an intern who we had working with us. Finally, after I had constructed several models, I also requested some feedback from trusted colleagues to make sure that in my rush I hadn't overlooked anything. In the end, I was able to give a flawless presentation and provide several solid recommendations. The client ended up adopted three of them, and the feedback in regards to the presentation was all positive."

  16. 16.

    Tell me what financial modeling is and why it's important.

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  17. 17.

    Can you tell me what EBITDA is?

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  18. 18.

    What metric would you use to analyze a company's stock and why?

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  19. 19.

    Tell me about a time when an analysis didn't go as planned. What did you learn?

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  20. 20.

    Do you prefer to work independently or on a team?

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  21. 21.

    Have you or are you considering getting any licenses or certifications?

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  22. 22.

    Why do you want to work for our company?

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  23. 23.

    Tell me what you would do if you noticed an inconsistency in our company's financial records.

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  24. 24.

    After you work as a financial analyst in fintech, what kind of role do you plan to move into?

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