Senior Fund Accounting Associate Interview Questions and Answers

Hedge funds are private investment funds with high risk and high returns, while mutual funds are publicly traded investment funds with lower risk and returns.

• Hedge funds are typically only available to accredited investors, while mutual funds are open to the general public.

• Hedge funds often use complex strategies like short selling and leverage to generate high returns, while mutual funds typically follow a more traditional long-only approach.

• Hedge funds have higher fees and ...read more

Accrual concept is a fundamental accounting principle where revenue and expenses are recognized when they are incurred, regardless of when cash is exchanged.

• Revenue and expenses are recorded in the period they are earned or incurred, not when cash is received or paid.

• Accrual accounting provides a more accurate representation of a company's financial position and performance.

• Examples include recognizing revenue when services are provided, even if payment is not received until ...read more

Net asset value (NAV) is the value of a fund's assets minus its liabilities, divided by the number of shares outstanding.

• NAV is calculated by subtracting the fund's liabilities from its assets

• The result is then divided by the number of shares outstanding to determine the NAV per share

• NAV is used to determine the price at which shares of a mutual fund are bought or sold