200+ Finance Executive Interview Questions and Answers

TDS slabs are tax rates at which tax is deducted at source based on income levels.

• TDS slabs vary based on the type of income and the individual's age

• For example, TDS on salary income ranges from 0% to 30% depending on income levels

• TDS on interest income is usually deducted at 10% for individuals

My goal for future planning is to continuously learn and grow in my career while maintaining a healthy work-life balance.

• Continuously improve my skills and knowledge through training and development opportunities

• Set achievable career goals and work towards them

• Prioritize self-care and maintain a healthy work-life balance

• Stay up-to-date with industry trends and advancements

• Build strong professional relationships and network

• Contribute to the success of my organization

Sales and purchase invoices are documents used in financial transactions, while bank statements show transactions with a bank. AR stands for accounts receivable and AP stands for accounts payable.

• Sales and purchase invoices are documents used to record sales and purchases in a business.

• Bank statements show all transactions made with a bank account, including deposits, withdrawals, and fees.

• AR (accounts receivable) represents money owed to a company by its customers for goods ...read more

Two way matching compares invoice and purchase order, while three way matching adds receipt of goods to the comparison.

• Two way matching ensures that the invoice matches the purchase order in terms of quantity, price, and terms.

• Three way matching adds the receipt of goods to the comparison to ensure that the goods have been received and match the invoice and purchase order.

• Two way matching is commonly used for low-value purchases, while three way matching is used for high-valu...read more

I have a passion for numbers and problem-solving, and I believe accounting is the foundation of finance.

• I enjoy working with numbers and analyzing financial data.

• I have strong attention to detail and organizational skills, which are essential in accounting.

• I believe accounting is the language of business and provides a solid foundation for a career in finance.

• I am interested in helping businesses make informed financial decisions and improve their overall performance.

Child labor persists due to poverty, lack of education, and weak enforcement of laws.

• Poverty forces families to rely on children for income

• Lack of education limits opportunities for children and perpetuates the cycle of poverty

• Weak enforcement of laws allows employers to exploit children for cheap labor

• Cultural attitudes towards child labor also play a role in its persistence

• International demand for cheap goods fuels the demand for child labor in some industries

• Efforts to com...read more

Taxation refers to the process of levying taxes on individuals and businesses by the government.

• Taxation is used by governments to generate revenue for public services and infrastructure.

• Different types of taxes include income tax, sales tax, property tax, and corporate tax.

• Tax laws and regulations vary by country and can be complex and constantly changing.

• Tax planning and compliance are important for individuals and businesses to avoid penalties and maximize tax benefits.

• Tax...read more

Depreciation refers to the decrease in the value of an asset over time due to wear and tear, obsolescence, or other factors.

• Depreciation is a non-cash expense that is recorded on the income statement.

• It is used to allocate the cost of an asset over its useful life.

• There are various methods of calculating depreciation, such as straight-line, declining balance, and sum-of-the-years'-digits.

• Depreciation is important for financial reporting and tax purposes.

• For example, a company...read more

The journal entry for purchases involves debiting the Purchases account and crediting the Accounts Payable or Cash account.

• Debit the Purchases account to record the cost of goods purchased

• Credit the Accounts Payable account if the purchase is made on credit

• Credit the Cash account if the purchase is made in cash

• If applicable, include additional accounts such as Sales Tax Payable or Discounts

• Example: Debit Purchases $10,000, Credit Accounts Payable $10,000

PAN stands for Permanent Account Number. RBI stands for Reserve Bank of India.

• PAN is a unique 10-digit alphanumeric code issued by the Income Tax Department of India.

• It is used as an identification number for individuals, companies, and other entities.

• RBI is the central bank of India responsible for regulating the country's monetary policy and managing the currency.

• It was established in 1935 and has its headquarters in Mumbai.

• RBI issues currency notes and coins, regulates ban...read more

It is possible to file returns without software utility.

• Use the offline Excel or Java utility provided by the tax department.

• Fill in the details manually on the tax department's website.

• Seek assistance from a tax professional or a tax return preparer.

• Submit the returns physically by visiting the tax department's office.

• Ensure all necessary documents and forms are in order before filing.

The journal entry for lease accounting in the books of lessee involves recording the lease liability and right-of-use asset.

• Debit the right-of-use asset account for the present value of the lease payments

• Credit the lease liability account for the same amount

• Recognize interest expense on the lease liability

• Recognize amortization expense on the right-of-use asset

• Adjust for any lease payments made

• Example: Debit Right-of-Use Asset for $10,000, Credit Lease Liability for $10,000

• Ex...read more

Different types of interest rates include fixed, variable, prime, and LIBOR rates.

• Fixed interest rates remain the same throughout the loan term

• Variable interest rates fluctuate based on market conditions

• Prime rates are the interest rates that banks charge their most creditworthy customers

• LIBOR rates are the average interest rates at which major global banks borrow from one another

I have extensive knowledge of International airport departments and their operations.

• I am familiar with the regulations and procedures of international airports.

• I have experience in managing airport operations, including security, customs, and immigration.

• I understand the importance of maintaining safety and security measures at all times.

• I am knowledgeable about airport technology and equipment, such as baggage handling systems and security scanners.

• I have worked with variou...read more

Going concern concept is the assumption that a company will continue to operate in the foreseeable future, while matching concept is the principle of matching expenses with revenues in the same accounting period.

• Going concern concept assumes that a company will continue to operate for the foreseeable future without the need to liquidate assets or be forced out of business.

• Matching concept states that expenses should be recognized in the same period as the revenues they help g...read more

Prepaid income is income received in advance, while prepaid expenses are expenses paid in advance.

• Prepaid income is income received before it is earned, such as subscription fees paid in advance.

• Prepaid expenses are expenses paid for in advance, like insurance premiums or rent.

• Both prepaid income and prepaid expenses are recorded as assets on the balance sheet until they are earned or used.

Balance sheet structure includes assets, liabilities, and equity. InAS affects presentation and disclosure of financial information.

• Balance sheet includes assets, liabilities, and equity

• InAS affects presentation and disclosure of financial information

• InAS requires separate presentation of current and non-current assets and liabilities

• InAS requires disclosure of significant accounting policies and estimates

• InAS requires disclosure of related party transactions

Yes, maintaining general entries involves recording financial transactions in the general ledger.

• General entries are recorded in the general ledger to track all financial transactions.

• Each entry should include the date, description, debit amount, and credit amount.

• Balancing entries are made to ensure that debits equal credits.

• Examples of general entries include recording revenue, expenses, assets, and liabilities.

Recent amendments in GST, Income tax, Ind AS, and capital budgeting.

• GST: Introduction of e-invoicing and QR code, extension of due dates for filing returns.

• Income tax: Introduction of new tax regime, changes in TDS rates.

• Ind AS: Amendments related to lease accounting and revenue recognition.

• Capital budgeting: Emphasis on digitalization and automation, increased focus on risk management.

The three financial statements are the income statement, balance sheet, and cash flow statement.

• The income statement shows a company's revenue and expenses over a period of time.

• The balance sheet shows a company's assets, liabilities, and equity at a specific point in time.

• The cash flow statement shows a company's inflows and outflows of cash over a period of time.

• The income statement and cash flow statement are linked through net income, which is used to calculate cash flow ...read more

GAP refers to Generally Accepted Accounting Principles and revenue recognition principles dictate when and how revenue should be recorded.

• GAP is a set of accounting standards used to ensure consistency in financial reporting.

• Revenue recognition principles determine the timing and amount of revenue that should be recorded.

• Revenue is typically recognized when it is earned and realized or realizable.

• Examples of revenue recognition principles include the percentage of completion ...read more

Preparation of balance sheet involves listing assets, liabilities, and equity. Ratios are computed using financial data from the balance sheet.

• List all assets, liabilities, and equity on the balance sheet

• Calculate various financial ratios such as current ratio, debt to equity ratio, and return on equity

• Use formulae like Current Ratio = Current Assets / Current Liabilities

• Interpret the ratios to analyze the financial health and performance of the company

SEZ customs refer to the customs regulations and procedures applicable to Special Economic Zones.

• SEZ customs are designed to promote exports and attract foreign investment by providing tax incentives and streamlined customs procedures.

• SEZs are designated geographical areas within a country that are treated as foreign territory for the purposes of trade and commerce.

• SEZ customs may include exemptions from customs duties, simplified procedures for import and export of goods, an...read more

Our company has experienced steady growth over the past few years.

• We have consistently increased our revenue year over year.

• We have expanded our customer base and entered new markets.

• We have successfully launched new products and services.

• We have made strategic acquisitions to enhance our capabilities.

• We have improved operational efficiency and cost management.

• We have attracted top talent and built a strong team.

• We have gained recognition and industry awards for our performan...read more

A process of matching three documents - purchase order, invoice, and receiving report - to ensure accuracy of payment.

• Three documents - purchase order, invoice, and receiving report - are compared to ensure accuracy of payment.

• The purchase order details what was ordered and at what price.

• The receiving report confirms that the goods were received and in what quantity.

• The invoice details what was shipped and at what price.

• All three documents must match in terms of quantity, pri...read more

Finance companies are non-banking institutions that provide financial services, while banks are traditional financial institutions that offer a wide range of services.

• Finance companies are non-banking institutions that specialize in providing loans, credit, and other financial services.

• Banks are traditional financial institutions that offer a wide range of services, including savings accounts, checking accounts, and investment services.

• Finance companies typically have higher ...read more

Service industry provides intangible products while manufacturing industry produces tangible products.

• Service industry focuses on providing services rather than physical products

• Manufacturing industry involves the production of tangible goods

• Service industry is labor-intensive while manufacturing industry is capital-intensive

• Service industry has a higher degree of customer interaction compared to manufacturing industry

• Examples of service industry include hospitality, healthca...read more

Knowledge of computer hardware, software, and applications is essential for a finance executive.

• Proficiency in Microsoft Excel for financial analysis and reporting

• Understanding of accounting software like QuickBooks or SAP

• Knowledge of financial modeling tools like Bloomberg or Tableau

• Familiarity with ERP systems for managing financial data

• Ability to use data visualization software for presenting financial information

Month end process refers to the activities that are performed at the end of each month to close the books and prepare financial statements.

• Reconciling accounts

• Posting adjusting entries

• Preparing financial statements

• Reviewing financial performance

• Closing the books

• Ensuring compliance with accounting standards

• Preparing for audits

The three golden rules are basic principles of accounting that ensure accurate financial records.

• 1. The first golden rule is to maintain a separate business account from personal accounts to ensure accurate financial tracking.

• 2. The second golden rule is to record all transactions accurately and promptly to avoid errors in financial statements.

• 3. The third golden rule is to always follow the principle of double-entry accounting, where every debit has a corresponding credit to...read more

Life insurance is a financial product that provides a lump sum payment to beneficiaries upon the insured's death.

• Life insurance provides financial protection for loved ones in the event of the insured's death.

• It can help cover funeral expenses, pay off debts, and replace lost income.

• There are different types of life insurance policies, such as term life and whole life.

• Premiums are paid regularly to maintain coverage.

• Life insurance can also be used as an investment vehicle, wi...read more

TDS on purchase of land from an individual for ₹10000000 is applicable.

• TDS rate on purchase of land from an individual is 1% if the value exceeds ₹50 lakhs.

• In this case, TDS amount would be ₹100000 (1% of ₹10000000).

• The buyer is required to deduct TDS at the time of making payment to the seller.

• TDS should be deposited with the government and TDS certificate should be issued to the seller.

Finance executive system refers to the software and tools used by finance executives to manage financial operations and make strategic decisions.

• Finance executive system includes financial planning and analysis tools, accounting software, and reporting systems.

• These systems help finance executives to track financial performance, forecast future trends, and make data-driven decisions.

• Examples of finance executive systems include SAP, Oracle Financials, and QuickBooks.

• Finance e...read more

I am comfortable with IND-AS 109, 115, 116, and 113 in finance reporting.

• IND-AS 109: Financial Instruments

• IND-AS 115: Revenue from Contracts with Customers

• IND-AS 116: Leases

• IND-AS 113: Fair Value Measurement

The golden rule of accounting is to debit the receiver and credit the giver.

• It is a fundamental principle of double-entry bookkeeping.

• It ensures that every transaction is recorded accurately.

• Debit refers to the left side of an account, while credit refers to the right side.

• For example, when a company receives cash from a customer, it debits the cash account and credits the accounts receivable account.

• This rule helps maintain the balance sheet equation: Assets = Liabilities + ...read more

Applications leveraging artificial intelligence and machine learning are now able to perform complex tasks that previously required human input.

• Artificial intelligence and machine learning technologies have advanced to the point where they can analyze large datasets and make decisions without human intervention

• Examples include chatbots that can provide customer service, algorithms that can predict financial market trends, and self-driving cars that can navigate roads autonomo...read more

GR IR process is used to reconcile goods receipts and invoices. Payment process to vendors and customers involves issuing payments based on agreed terms.

• GR IR process ensures that the goods received match the invoice received from the vendor.

• Payment process to vendors involves creating a payment proposal, approving it, and executing the payment.

• Payment process to customers involves creating an invoice, sending it to the customer, and receiving payment.

• Payment terms can vary b...read more

Settling employee bonuses involves determining the amount, timing, and method of payment.

• Determine the amount of the bonus based on performance, company profits, or other factors

• Decide on the timing of the bonus, such as end of year or quarterly

• Choose the method of payment, such as cash, check, or direct deposit

• Communicate the bonus structure and payment details clearly to employees

• Consider tax implications and ensure compliance with labor laws

GST stands for Goods and Services Tax. It is a comprehensive indirect tax levied on the supply of goods and services.

• GST is a single tax that replaced multiple indirect taxes in India.

• It was implemented on July 1, 2017, with the aim of simplifying the tax structure and eliminating cascading effects.

• GST is levied at every stage of the supply chain, from the manufacturer to the consumer.

• It has different tax rates for different goods and services, such as 0%, 5%, 12%, 18%, and 2...read more

The limit for 194C is Rs. 30,000 for a single payment and Rs. 1,00,000 in aggregate during a financial year.

• The limit for 194C is applicable for payments made to contractors and sub-contractors for carrying out any work.

• If the payment to a single contractor or sub-contractor exceeds Rs. 30,000 in a single transaction, TDS (Tax Deducted at Source) needs to be deducted at the rate of 1%.

• If the total payments made to a contractor or sub-contractor exceed Rs. 1,00,000 in a financ...read more

The rate for 194C is 1% for payments made to contractors or sub-contractors for carrying out any work.

• The rate for 194C is applicable for payments made to contractors or sub-contractors for carrying out any work.

• The rate is 1% of the total payment amount.

• This provision is under the Indian Income Tax Act.

Accounting principles are the guidelines and rules that govern the preparation and presentation of financial statements.

• They provide a framework for recording, classifying, and summarizing financial transactions.

• They ensure consistency and comparability in financial reporting.

• Examples include the accrual principle, the matching principle, and the cost principle.

• They are established by standard-setting bodies such as the Financial Accounting Standards Board (FASB) and the Inte...read more

Financial statements are formal records of the financial activities and position of a business, organization, or individual.

• Financial statements include the balance sheet, income statement, and cash flow statement.

• They provide information on the financial performance, financial position, and cash flows of an entity.

• Balance sheet shows assets, liabilities, and equity at a specific point in time.

• Income statement shows revenues, expenses, and profits over a period of time.

• Cash f...read more

My specialization in MBA is Finance.

• I have specialized in finance during my MBA program.

• I have taken courses in financial management, investment analysis, and corporate finance.

• I have practical experience in financial analysis and budgeting.

• I am knowledgeable in financial modeling and forecasting.

• I have a strong understanding of financial markets and instruments.

Assets are resources owned by a company, liabilities are debts or obligations, and equity is the difference between assets and liabilities.

• Assets include cash, inventory, equipment, and investments.

• Liabilities include loans, accounts payable, and bonds payable.

• Equity represents the owner's stake in the business and is calculated as assets minus liabilities.

• Assets = Liabilities + Equity is the fundamental accounting equation.

Assets should be put to use when they can generate revenue or provide value to the organization.

• Assets should be put to use when they are fully operational and can contribute to the organization's goals.

• Consider the cost of holding onto the asset versus the potential benefits of putting it to use.

• Regular maintenance and monitoring of assets are essential to ensure they are ready to be put to use.

• Examples include machinery being used in production, vehicles being used for tran...read more

Balance sheet shows assets, liabilities, and equity at a specific point in time. Trial balance lists all ledger accounts with their balances.

• Balance sheet is a snapshot of a company's financial position at a specific point in time.

• Trial balance is a list of all ledger accounts with their balances to ensure debits equal credits.

• Balance sheet includes assets, liabilities, and equity sections.

• Trial balance is used to prepare financial statements like income statement and balance...read more