10+ Financial Planning and Analysis Analyst Interview Questions and Answers

Financial planning and analysis involves forecasting, budgeting, and analyzing financial data to help organizations make informed decisions.

• It helps organizations plan and allocate resources effectively

• It involves analyzing financial statements and performance metrics

• It helps identify trends and potential risks

• It assists in creating financial models and forecasts

• It helps in making informed decisions about investments and capital expenditures

I view audits as an opportunity to ensure accuracy and compliance while identifying areas for improvement.

• I approach audits with a thorough and detail-oriented mindset

• I prioritize accuracy and compliance in all aspects of the audit process

• I use audits as a chance to identify areas for improvement and make recommendations for changes

• I work closely with auditors to ensure a smooth and efficient process

• For example, in my previous role as a financial analyst, I conducted regular ...read more

Budget is a plan for future financial activities, while forecast is a prediction of future financial outcomes.

• Budget is a detailed financial plan for a specific period, usually a year, outlining expected revenues and expenses.

• Forecast is an estimate of future financial outcomes based on past data and current trends.

• Budgeting techniques include zero-based budgeting, incremental budgeting, and activity-based budgeting.

• Forecasting techniques include qualitative methods like expe...read more

INDAS115 is a standard that outlines the steps for recognizing revenue from contracts with customers.

• Identify the contract with the customer

• Identify the performance obligations in the contract

• Determine the transaction price

• Allocate the transaction price to the performance obligations

• Recognize revenue when the performance obligations are satisfied

EBITA is a financial metric representing earnings before interest, taxes, depreciation, and amortization. COGS stands for cost of goods sold. Allocation refers to the distribution of resources. Future goals are targets set for the future.

• EBITA is a measure of a company's operating performance without factoring in financing and tax implications.

• COGS represents the direct costs of producing goods sold by a company.

• Allocation involves assigning resources such as funds, personnel...read more

Depreciation and amortization are accounting methods used to allocate the cost of tangible and intangible assets over their useful lives.

• Depreciation is the allocation of the cost of tangible assets (such as buildings, machinery, vehicles) over their useful lives.

• Amortization is the allocation of the cost of intangible assets (such as patents, copyrights, trademarks) over their useful lives.

• Both depreciation and amortization are non-cash expenses that reduce the value of an a...read more

Forecasting is the process of predicting future outcomes based on historical data and trends.

• Forecasting involves analyzing past data and trends to make predictions about future outcomes.

• It helps businesses make informed decisions about resource allocation, budgeting, and goal setting.

• There are various methods of forecasting, including time series analysis, regression analysis, and scenario planning.

• Examples of forecasting include predicting sales revenue, estimating future e...read more

Break even sales is the point where total revenue equals total costs resulting in zero profit or loss.

• Break even sales is the minimum amount of sales required to cover all the costs incurred in producing and selling a product or service.

• It is calculated by dividing the total fixed costs by the contribution margin per unit.

• The contribution margin is the difference between the selling price per unit and the variable cost per unit.

• Once the break even point is reached, any additi...read more

FP&A involves analyzing financial data to provide insights and support decision-making within an organization.

• FP&A focuses on budgeting, forecasting, and financial analysis

• It helps in identifying trends, risks, and opportunities for the business

• Provides insights to support strategic decision-making

• Involves creating financial models and reports for management

• Plays a crucial role in driving business performance and profitability

The golden rules of accounting are basic principles that guide the process of recording financial transactions.

• The golden rules include the principles of debit and credit, which are used to record transactions accurately.

• Debit what comes in and credit what goes out is one of the golden rules of accounting.

• Another golden rule is debit the receiver and credit the giver.

• The final golden rule is debit all expenses and losses, credit all incomes and gains.

Budgeting is the process of creating a plan for how to spend money, taking into account income and expenses.

• Budgeting involves setting financial goals and creating a roadmap to achieve them

• It helps in tracking expenses, identifying areas for cost savings, and ensuring financial stability

• Examples of budgeting tools include spreadsheets, budgeting apps, and financial planning software

Budgeting involves setting a financial plan for a specific period, while forecasting predicts future financial outcomes based on current data and trends.

• Budgeting is a detailed financial plan for a specific period, usually a year, outlining expected revenues and expenses.

• Forecasting involves predicting future financial outcomes based on current data and trends, helping in decision-making and planning.

• Budgeting is more rigid and focuses on achieving specific financial goals, w...read more

Prepaid taxes are recorded as an asset on the balance sheet until they are actually paid.

• Prepaid taxes are initially recorded as a debit to the Prepaid Taxes account and a credit to the Cash account.

• When the taxes are actually paid, the entry is a debit to the Taxes Expense account and a credit to the Prepaid Taxes account.

• The balance in the Prepaid Taxes account represents taxes that have been paid in advance but not yet expensed.

Order to cash process is the set of business processes involved in receiving and fulfilling customer orders.

• Customer places an order

• Order is processed and approved

• Product is picked, packed, and shipped

• Invoice is generated and sent to customer

• Payment is received and recorded

Bank reconciliation is the process of comparing a company's records with those of the bank to ensure they match.

• Gather bank statements and company records

• Compare deposits, withdrawals, and fees between the two sets of records

• Identify and investigate any discrepancies

• Adjust the company's records to match the bank's records

• Prepare a bank reconciliation statement to document the process