Morningstar Financial Analyst Interview Questions and Answers

Lease accounting refers to the accounting treatment of lease agreements by lessees and lessors.

• Lease accounting involves recognizing lease assets and liabilities on the balance sheet.

• There are two main types of leases: operating leases and finance leases.

• Under operating leases, lease payments are expensed over the lease term.

• Under finance leases, the lessee recognizes both an asset and a liability on the balance sheet.

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Prepayment is the payment of a debt before it is due.

• Prepayment is the act of paying off a loan or debt before the scheduled due date.

• It can help save on interest costs by reducing the overall amount owed.

• Common examples include making extra mortgage payments or paying off a car loan early.

IFRS 16 is the new lease accounting standard that requires lessees to recognize most leases on their balance sheets.

• IFRS 16 eliminates the distinction between operating and finance leases for lessees, requiring them to recognize all leases on their balance sheets as liabilities with corresponding assets.

• Lessees must calculate the present value of lease payments and recognize a right-of-use asset and lease liability on ...read more

A forward mortgage is a type of mortgage where the borrower receives the entire loan amount upfront and makes regular payments towards the loan over time.

• Borrower receives the full loan amount at the beginning of the loan term

• Regular payments are made towards the loan, typically including both principal and interest

• Interest rates for forward mortgages can be fixed or adjustable

• Common type of mortgage for purchasing a h

A reverse mortgage is a type of loan for homeowners age 62 and older that allows them to convert part of the equity in their homes into cash.

• Reverse mortgage borrowers do not have to repay the loan until they sell the home, move out, or pass away.

• The loan amount is based on the value of the home, the borrower's age, and current interest rates.

• Interest on a reverse mortgage is not tax-deductible until the loan is paid o...read more

Experienced financial analyst with a background in investment banking and financial modeling.

• Over 5 years of experience in financial analysis

• Strong background in investment banking and financial modeling

• Proficient in financial software such as Excel and Bloomberg

• Excellent communication and presentation skills

• Bachelor's degree in Finance from XYZ University

Financial planning involves setting goals, creating a budget, saving and investing wisely, and managing debt.

• Setting financial goals for short-term and long-term needs

• Creating a budget to track income and expenses

• Saving and investing money wisely to achieve financial goals

• Managing debt effectively to avoid financial strain

• Regularly reviewing and adjusting the financial plan as needed