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FP&A Interview Questions and Answers (30 Samples)

30 common FP&A technical, fit, behavioral, and logic questions to help you join the industry

Elliot currently works as a Private Equity Associate at Greenridge Investment Partners, a middle market fund based in Austin, TX. He was previously an Analyst in  Piper Jaffray 's Leveraged Finance group, working across all industry verticals on  LBOs , acquisition financings, refinancings, and recapitalizations. Prior to Piper Jaffray, he spent 2 years at  Citi  in the Leveraged Finance Credit Portfolio group focused on origination and ongoing credit monitoring of outstanding loans and was also a member of the Columbia recruiting committee for the Investment Banking Division for incoming summer and full-time analysts.

Elliot has a Bachelor of Arts in Business Management from Columbia University.

Prior to joining UBS as an Investment Banker, Himanshu worked as an Investment Associate for Exin Capital Partners Limited, participating in all aspects of the investment process, including identifying new investment opportunities, detailed due diligence,  financial modeling  &  LBO  valuation and presenting investment recommendations internally.

Himanshu holds an  MBA  in Finance from the Indian Institute of Management and a Bachelor of Engineering from Netaji Subhas Institute of Technology.

10 Common FP&A Technical Questions

• 10 Hard FP&A Technical Questions  And Answers

5 Common FP&A Behavioral/Fit Questions

• 5 Firm-Specific Behavioural/ Fit Questions For FP&A Interviews
• WSO Interview Prep Guides & Additional Resources

Financial Planning & Analysis (FP&A) teams have established themselves as crucial to an organization’s long-term growth and success through budgeting, modeling, forecasting, and analyzing financial metrics utilized by management executives to make informed decisions.

The FP&A interview process is designed to identify capable candidates with strong attention to detail and critical thinking qualities. Given this, answering the technical and behavioral questions with confidence and consistency is key to converting an interview into an offer.

The following free WSO FP&A interview guide serves as a comprehensive resource designed to cover multiple aspects of the interview process, drastically improving your odds of receiving an FP&A offer at your dream F500 company.

This guide features  30  of the most common technical and behavioral questions, along with proven sample answers, that are asked by FP&A hiring professionals to candidates during the hiring process. 

This resource further includes  15 firm-specific questions  asked to candidates by professional FP&A hiring teams at  F500 companies ( Morgan Stanley , Deloitte , etc.)  and other  world-renowned firms ( Houlihan Lokey , Vanguard Group ,   etc.),  and there are  sample answers  to each question.

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Technical questions are a critical component of almost every FP&A recruiting process. Generally, FP&A teams look for a solid understanding of basic concepts in finance and accounts, which you can consequently apply to technicals asked to you - as opposed to asking common questions easily memorized by candidates.

Therefore, naturally, your answers must demonstrate in-depth knowledge and expertise of the topic at hand. 

The following section features 10 common FP&A interview questions , all of which have been provided sample answers. At the end of these 10 questions, we have provided you with 10 exclusive firm-specific technical questions to kickstart your mock interview training.

1. What are the 3 main financial statements?

• Revenues – Cost of Goods Sold – Expenses = Net Income
• Expenses include both cash and non-cash expenses and both operating and non- operating expenses .
• Net Income  DOES NOT  equal cash flow and should not be considered an accurate representation of a company’s ability to generate cash because the Income Statement includes non-cash expenses and does not reflect the cash impact of changes in Working Capital or Capital Expenditures.

• Assets = Liabilities + Shareholder ’s Equity
• Assets and Liabilities are often shown in order of “liquidity”, or the rate at which that asset or liability is expected to be realized in cash (ordered from most current/liquid to least current/liquid)
• SCF also shows capital expenditures (a non-operating cash outflow) as well as cash inflows from the sale of capital assets (for example, Plant, Property & Equipment) in the Cash Flow from Investing section
• SCF also contains the Cash Flow from Financing section, which shows the cash impact (inflow or outflow) of activity with a company’s investors (both debt and equity). This includes debt capital raised or repaid, equity capital raised or repurchased, or dividends paid.
• Beginning Cash + CF from Operations + CF from Investing + CF from Financing = Ending Cash

Sample Answer: 

The three primary financial statements are the Income Statement, the Balance Sheet , and the Statement of Cash Flows. 

The Income Statement shows a company’s revenues, costs, and expenses, which together yield net income. 

The Balance Sheet shows a company’s assets, liabilities, and equity and represents the company’s financial health /position on one particular day in time. 

The Cash Flow Statement starts with net income from the Income Statement; then, it shows adjustments for non-cash expenses, non-expense purchases such as capital expenditures, changes in working capital, or debt repayment and issuance to calculate the company’s ending cash balance.

2. When should an expense appear on the income statement?

Sample Answer:

In order to be presented on the income statement, the expense must be tax-deductible and must have been incurred during the period of the income statement.

Expenses that end up on the income statement are factors such as marketing expenses, employee salaries, etc.

3. What are the three components of a statement of cash flows?

The Statement of Cash Flows is one of the three financial reports that all public companies are required by the SEC to produce quarterly. Most non-public companies also prepare the Cash Flow (CF) Statements. 

It comprises the three main components described below, showing all of the company’s sources and uses of cash. However, since companies tend to use accrual accounting, their net income may not (and most of the time does not) portray how much cash flows in or out due to non-cash expenses, investing activities, financing activities, changes in working capital, etc. 

Because of this, even profitable ones may have trouble managing their cash flows, and non-profitable ones may be able to survive without raising outside capital.

Cash from operations:  Cash generated or lost through normal operations, sales, and changes in working capital (more detail on working capital below).

Cash from investing:  Cash generated or spent on investing activities; may include, for example, capital expenditures (use of cash) or asset sales (source of cash). This section will also show any investments in the financial markets and operating subsidiaries. 

This section can explain a large negative cash flow during the reporting period, which isn’t necessarily bad if it is due to large capital expenditure in preparation for future growth.

Cash from financing:  Cash raised to or paid for financing the business; may include proceeds from debt or equity issuance (source of cash) or cost of debt or equity repurchase (use of cash).

The three components of the Cash Flows Statement are  Cash from Operations, Cash from Investing, and Cash from Financing.

4. When looking at the acquisition of a company, should equity value or enterprise value be considered?

Since the acquiring company must purchase both liabilities and equity to take over the business, the buyer will need to assess the company’s Enterprise Value , which includes both the debt and the equity.

5. Given all other factors to be constant, should the cost of equity be higher for a company with a $100 million market cap or a $100 billion market cap?

Typically, a smaller company is expected to produce greater returns than a large company, meaning the smaller company is riskier and would have a higher cost of equity .

6. Describe a plausible scenario where a company may have negative shareholders equity.

If a company has had negative net income for a long time, it would have a negative retained earnings balance, which would lead to negative shareholders equity . A leveraged buy-out could have the same effect, and so would a large dividend payment to the owners of the business.

Sample Follow-up Question:  If a company with a highly levered capital structure was attempting to execute a large dividend recap (which may or may not create a negative shareholders equity balance), what might a debt holder do to enforce any protections he/she has as a debt investor?

Sample follow-up Answer:

Suppose a company has a highly levered capital structure. In that case, the legal documents governing the debt financing will generally limit the amount of total leverage (or indebtedness) that the company could raise. These limits are called negative covenants and will also be so specific as to clarify how much debt could be incurred that is senior to the existing debt in the capital structure and how much could be junior debt in the capital structure.

7. When building a model, what is the most common method to project items such as accounts receivable, accounts payable, inventory depreciation, and capital expenditures?

• Accounts receivable is usually projected as a percentage of revenues or using a ratio like Days Sales Outstanding .
• Accounts payable is generally projected as a percentage of the cost of goods sold or using a ratio like Days Payable Outstanding .
• Inventory is typically projected as a percentage of the cost of goods sold or using a ratio like Inventory Days.
• Depreciation can be calculated very simply using a percentage of the prior years’ PP&E or can be calculated at the individual asset level using different schedules, useful lives, etc.
• Capex is normally projected as a percentage of revenues, or from company guidance, you will have a relatively good idea of what CAPEX requirements are going forward.

8. What is operating leverage?

• Operating leverage is the percentage of costs that are fixed versus variable.
• A company whose costs are mostly fixed has a high level of operating leverage.
• Suppose a company has a high level of operating leverage. In that case, it means that much of any increase in revenue will fall straight to the bottom line in the form of profit because the incremental cost of producing another unit is so low.
• For example, a swim club is a business that operates with a high level of operating leverage. Once the club is built and opened, its costs are relatively fixed. With the same number of staff, same size pool, same locker rooms, same maintenance expense, the club could go from 500 members to 510 members with little additional cost. Nearly 100% of the membership fees collected from the 10 new members boost the bottom line.

Operating leverage is the relationship between a company’s fixed and variable costs . A company with relatively higher fixed costs as compared to variable costs has a higher level of operating leverage. 

While a company with a high degree of operating leverage will have a higher earnings growth potential than a company with a largely variable cost structure , certain financial institutions will prefer to lend to businesses with a variable cost structure to help mitigate their downside risk – the financial institution is comforted by the fact that the company they are lending to still has the ability to cut back on some of their expenses should they see an economic downturn approaching or other signs of a decrease in financial performance . 

Equity investors benefit the most from earnings growth potential and, as such, will prefer to invest in companies with a higher degree of operating leverage.

9. Why would a company distribute its earnings through dividends to common stockholders?

The distribution of a dividend signals that a company is healthy and profitable, thus attracting more investors, potentially driving up the company’s stock price.

10. If you are presented with two companies that are exactly the same in revenue, growth, risk, and other financial metrics, which company’s shares would be higher priced given one is public and the other private?

The public company most likely will be priced higher due to the liquidity premium one would pay to be able to buy and sell the shares quickly and easily in the public capital markets.

Another reason the public shares should be priced higher would be the transparency required for the firm to be listed on a public exchange. For example, publicly traded companies are required to file audited financial statements , allowing investors to view them.

The public company is likely to be priced higher for several reasons. The main reason is the liquidity premium investors will pay for the ability to trade their stock quickly and easily on the public exchanges. A second reason is a sort of “transparency premium” that derives from the public company’s requirement to make their audited financial documents public.

10 Hard FP&A Technical Questions  And Answers

Understanding the critical underlying concepts of the 10 technical problems covered above will undoubtedly result in a competitive edge over the applicant pool. However, to further capitalize upon this and achieve technical expertise, we believe it’s critical to tailor your preparation to the company you are applying for.

The following section features  10 exclusive questions  asked to candidates by professional FP&A hiring teams at  F500 companies (Morgan Stanley, Deloitte, etc.)  and other  world-renowned firms (Houlihan Lokey, Vanguard Group,   etc.)

The following questions have been taken from  WSO’s Company Database , which is sourced from the detailed experiences of more than 30,000 people with FP&A interviews.

Morgan Stanley FP&A Technical Questions:

• This question is used to gauge your general interest in the financial markets . You probably will not be expected to know the number to the penny, but knowing the levels of the three major exchanges/indices, as well as whether they were up or down and why will show your interviewer that you keep track of what is going on in the world of finance.
• You should know how the market moved (up or down) the previous day and why it moved. You can find this information by watching CNBC , reading the WSJ, or using Google.
• Yesterday the XXXX closed at XXXX, up/down XXX from the open. I also noticed that it was up XXX from the day before due to …
• It would also be a good demonstration of market interest to know the overall valuation levels of the three major indices. The P/E ratios for the overall Dow, S&P 500, and Nasdaq are publicly available on major financial news publications.

Sample Answer: Quantitative Easing is the name given to government policy to increase the money supply by injecting liquidity into the economy . This is done by repurchasing government assets from the market.

The reason behind using this policy is that it will increase the capital within the financial sector and, therefore, increase the amount that banks lend to consumers and small businesses to promote economic growth . However, this policy is usually only done when interest rates are already extremely low, and there are no other measures that can be taken to stimulate economic activity.

To see the complete definition, check out  WSO’s Financial Dictionary Quantitative Easing page .

Nordstrom Corporate Technical:

Sample Answer: I would determine who to go after by running down the corporate structure . Then, in the event that the parent company went bankrupt, I would consult with our counsel to see what legal action we could take.

Houlihan Lokey Technical Questions:

Sample Answer: The reason you project FCF for the DCF is that FCF is the amount of actual cash that could hypothetically be paid out to debt holders and equity holders from a company’s earnings.

Sample Answer: If you have a company with very unpredictable cash flows, then attempting to project those flows and create a DCF model would not be practical or accurate. Instead, you will most likely want to use a multiples or precedent transactions analysis in this situation.

Beta represents a given investment’s relative volatility or risk concerning the market.

• β < 1 means less volatile than the market (lower risk, lower reward).
• β > 1 means more volatile than the market (higher risk, higher reward).
• A beta of 1.2 means that an investment theoretically will be 20% more volatile than the market. If the market goes up 10%, that investment should increase by 12%.
• Beta is a measure of the volatility of an investment compared with the market as a whole. The market has a beta of 1, while investments that are more volatile than the market have a beta greater than 1, and those that are less volatile have a beta less than 1.

Nordea Bank Technical Question:

Sample Answer: If interest rates fall, bonds prices will rise, so you should buy bonds.

Deloitte Technicals:

Sample Answer: WACC is the acronym for Weighted Average Cost of Capital . It reflects the overall cost for a company to raise new capital, which represents the riskiness of investment in the company (the higher the risk, the higher the cost of capital). It is commonly used as the discount rate in a discounted cash flow analysis to calculate the present value of a company’s cash flows and terminal value .

The formula below helps you calculate the WACC of a company if you are put on the spot and asked to calculate it as part of your technical interview:

Where E = Market value of equity D = Book value of debt P = Value of preferred stock KE= Cost of equity ( Calculate using CAPM ) KD = Cost of debt (Current yield of debt) KP = Cost of preferred stock (Interested rate on preferred stock) T = Corporate tax rate

Keeping your technical overview at a high level in an interview is vital. Start with a high-level overview and be ready to provide more detail upon request. 

• Project out cash flows for 5 - 10 years depending on the stability of the company
• Discount these cash flows to account for the time value of money
• Determine the terminal value of the company - assuming that the company does not stop operating after the projection window
• Discount the terminal value to account for the time value of money
• Sum the discounted values to find an enterprise value
• Subtract the present value of debt (this is generally the market value of debt) and then divide by diluted shares outstanding to find an intrinsic share price

Common questions that follow this are:

Why do you multiply by (1-tax rate)?

You do this because interest expense (the cost of debt ) is tax-deductible, so you need to account for the benefit provided by this "debt tax shield."

What is the cost of equity ?

The cost of equity is usually calculated using the Capital Asset Pricing Model ( CAPM ).

CAPM = Risk-free rate + Beta * (Expected market return - Risk-free rate)

What is the exit multiple method for determining the terminal value?

Find an industry average multiple and multiply it by final year revenue (if using EV/Revenue) or final year EBITDA (if using EV/EBITDA).

The Vanguard Group FP&A Question:

• You can base your answer on the implied probability for future fed funds interest rates, which is what the market is pricing in. You can find this from the CME searching CME FedWatch. World interest rate monitors are available from a variety of places as well. 
• There’s no lack of other interest rate commentary out there as well. Focus on primary resources like Fed Statements, studying the Treasury Curve, and economic indicators .

Sample Answer 1:

I believe we’re in a lower for longer interest rate environment, and I think the Fed will remain cautious with any hikes until global economic conditions improve. However, the Fed Funds are currently implying a 53% chance for a rate hike by December, and I believe we’ll get the next rate hike in December or early next year.

Sample Answer 2: 

I have a hard time believing that the Fed would pull out the rug on the market with quick interest rate hikes while other global central banks are still cutting their rates amidst sluggish global growth.

Behavioral questions, also commonly referred to as “fit” questions, are designed to determine your attitude, work ethic, and personality in relation to the firm you are applying to. The FP&A interviewing team, on the other side, looks for an alignment between your values and that of their company.

FP&A teams typically take fit extremely seriously because you must collaborate over long hours and under tight deadlines, and therefore strong chemistry between team members is ideal.

This section walks you through 5 of the most common types of fit questions and suggests approaches for answering them. The proposed approaches and sample answers are meant to be illustrative. But, always remember, you need to adapt your answers to be true to yourself and your own words. 

"Coming from someone in FP&A, I would highlight your ability to model and, in specific terms, how modeling can improve their processes. Fit is a big part of FP&A because you’re going to work on a lean team and deal with all the chaotic moments together. You have to be on the same page. FP&A isn’t rocket science - you just need to be down to earth and show your willingness to be a team player!"

The following extract has been edited and was taken from WSO User  @deadpool7’s comment  on the “ How To Prep For FP&A Interviews ” post on  WSO Forums .

1. How do you see yourself contributing to our firm in both the short-term and long term?

The short-term goal should just be to accomplish everything you are given quickly and correctly while learning as much as possible during your first few years. Longer-term goals can be things such as: learning to lead and manage a team, bringing in new business, etc.

2. What serves as your biggest motivation?

Some factors you can list are:

• Outperforming expectations
• Hitting deadlines,
• Earning respect from your peers
• Maximizing efficiency

Rather than just saying what motivates you, have a story prepared that shows you are motivated by whatever you answer.

Sample Answer: My biggest motivation is earning the respect of my peers and boss. For example, in my job last summer, I was the sole intern responsible for building a model for a client. My boss, Mike, gave me the specifications and told me when he needed them. I wanted to make a positive impression, so I worked almost around the clock, including time at home, to build it in only three days. This allowed me time to sit down and go through it with Mike before it was needed and still get it edited well before the deadline. Mike respected me for getting it done early, and earning that kind of respect is what keeps me going.

3. Describe your ideal work environment.

The most important thing about your work environment, especially in an industry like finance where you spend so many hours together, is the people you work with.

Talk about the fact that you want to be in an environment with others who are all as dedicated, driven, and hard-working as you are, where everyone can rely on one another to get tasks done efficiently.

Say you excel in an environment with excellent communication and teamwork, one that will allow you to grow professionally and intellectually, where you are evaluated and rewarded based on your performance.

In my mind, at least in finance, the most essential aspect of the working environment is the people you are working with. When working side-by-side for countless hours per week, for years, if you do not enjoy the company of your colleagues, the environment will be challenging. My ideal workplace is one where everyone communicates well, works hard, and trusts each other to get the job done right and on time—and then the team is evaluated and rewarded based on performance.

4. Can you explain a concept to me that you learned in one of your classes in 60 seconds?

While this may seem a bit daunting, as long as you have thought about it at least a little bit in advance of your interview, you should be able to come up with a pretty good response.

Typically the interviewer is looking for something quantitative, likely from finance, accounting, engineering, class, etc. However, if you are explaining something from engineering or biochemistry, make sure it’s in plain English, and you aren’t throwing around acronyms that the average person wouldn’t understand. If you can explain something that maybe the interviewer doesn’t already know, in layman’s terms, that may be more engaging. But, if you are more comfortable explaining a financial or accounting topic, that’s fine too.

Let’s take the theory of the time value of money. This theory says basically that a dollar in hand today is worth more than a dollar in hand in the future. The reasoning behind this, in its simplest form, is twofold. First, due to inflation, today’s dollar is worth more than a dollar in X years because it can buy more goods. Second, if you have a dollar today, you can invest that dollar, which will appreciate in value.

5. Why do you wish to go into finance rather than entering another industry or starting your own business?

Talk about the learning experience FP&A will provide.

Acknowledge that the idea of starting your own business someday sounds exciting, but at this point, you don’t even know what it takes for a business to succeed; working in finance will teach you the skills and give you the experience to help make that happen.

Starting a business is difficult, especially with no track record.

My school was focused on entrepreneurship, which is definitely something that appeals to me. However, I concentrated on finance because I knew I wanted to get experience before ever trying to start something on my own. I knew that getting into finance would give me exposure to many different businesses and how they really work, allowing me to have a solid foundation for anything that I would want to do, whether staying in finance, going back to school, or starting a new venture. I know that this is the best step to building my career coming out of college.

5 Firm-Specific Behavioural/ Fit Questions for FP&A Interviews

Knowing the culture of each FP&A team before walking into an interview is key to clicking with the interviewer and walking out with an offer. The following section features 5 exclusive questions that interviewers ask in the world’s biggest firms during interviews. It aims to help you jumpstart your training for the respective firms and tier FP&A you are interviewing for.

WSO’s company database

The following questions have been taken from WSO’s company database, which contains detailed interviews experiences of more than 30,000 people.

WSO Company Database

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Morgan Stanley FP&A Behavioral Assessment:

1. You have a finance background and have some HNWIs you can prospect, but there are 10,000 other people exactly like you. So why should you be the one to get this job?

"You're absolutely right. However, I believe my unique background working as a buy-side analyst with my good presentation skills with clients allows me to build credibility faster with HNWIs versus someone from a less technical background. People can smell a sales pitch , but I actually have the portfolio management skills to back it up."

 2. How do you react to rejection?

I take it as an opportunity to overcome an objection, and if that fails, I learn from it. I look at rejection as a necessary consequence of speaking with a diverse group of people. It's not a personal reflection on me, assuming I did a good job highlighting my portfolio management services to the prospect. Rejection doesn't discourage me because I know I have something of value to offer, which motivates me to continue speaking with prospects until I find a good fit for my services.

Bank of America FP&A Fit Questions:

3. How would you tell clients that they lost a large part of their investments in a market correction? Would you tell them upfront or wait until the whole process was over?

When this question is asked - they want to see you have good ethics and integrity.

I would inform the client upfront, explain the situation to them, and explain the preventive measures I would undertake to minimize the risk of such an instance occurring again. I don’t believe in covering up our mistakes, and I believe integrity is key to establishing a long-lasting relationship with clients.

 4. What is your biggest weakness?

Seeing how common this question is (even outside of the finance industry), we have a dedicated page for this question to support you in answering it ideally during the interview. The “Good Responses To Biggest Weakness Questions” page can be found  here .

 5. “Tell me about a time that…”

There are countless variations of this question, from “Tell me about a time you acted with integrity” to “Tell me about when you had difficulty dealing with coworkers”. It is key to have a well-rehearsed response for each and a general guideline to follow.

Ideally, you can develop 6-8 stories that cover the 30-40 basic questions, with only slight modifications. DON’T wing it. For every potential question, map out the story using the SOAR framework.

Describe the Situation (10-15 seconds), Obstacle (10-15s), Action (60-75s), and Result (15-30s). 

Stories for these questions should be 1.5 - 2 minutes long and focus only on what’s important.

  WSO Interview Prep Guides & Additional Resources

Over recent years, breaking into a lucrative finance career has tremendously increased in difficulty with an extremely high number of qualified applicants applying for a limited number of positions. Given this, professionals and students alike should capitalize upon every resource available to them to ensure success in their job search.

WSO offers  premium 1:1 services , such as the  WSO Resume Review  and  WSO Mentor Service , that will match you with an  elite professional in your target industry  for  one-on-one help  to drastically increase your odds of landing your dream FP&A job. With a successful track record of delivering results to over  2,300 clients over the last 10 years , you can rest assured our premium service will deliver results.

Check out WSO Resume Review and WSO Mentor Service by clicking on the buttons below.

Additionally, finetune your preparation and training towards your dream FP&A position. From our comprehensive  Investment Banking Interview Prep Course , which features  7,548 questions across 469 investment banks , to our  WSO Elite Modeling Package   covering  Excel, 3 Statements , LBO , M&A, Valuation + DCF Modeling , we’ve got you covered for every career path of finance!

Check out our complete collection of courses offered by clicking the button below. 

Additional WSO resources:

The following additional resources are recommended by WSO for taking a look at. 

• For Those Of You In FP&A, What Are Your Hours?
• How Engaging Is FP&A Really?

Additional interview resources

To learn more about interviews and the questions asked, please check out the additional interview resources below:

• Investment Banking Interview Questions and Answers
• Private Equity Interview Questions and Answers
• Hedge Funds Interview Questions and Answers
• Finance Interview Questions and Answers
• Accounting Interview Questions and Answers

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Financial Planning and Analysis Interview Questions: Get a job of an FP&A Analyst or Manager

You’ve earned your degree in Accounting or Mathematics, but you find recording transactions rather boring . Numbers interest you, but you want to see behind them . You want to find the reason why company made that much, or that little money, in a given time period.

Finding interesting stories while reading financial data , and providing managers with the information they need, in order to take both strategical and operational decisions, is definitely more interesting than just recording transactions and preparing balance sheets (that’s what accountants do).

FP&A jobs are a great choice, and each bigger corporation runs an entire FP&A department . Let’s have a look at some questions they may ask you in an interview, and what you should say to get the job .

Table of Contents

Why FP&A, and not accounting, or other job?

They want to see whether you understand the difference between the two , and if you know why you actually applied.

You can say that you are rather creative, and prefer to dig deep into the numbers. Discovering the things happening behind the scenes (or behind the numbers) is more motivating for you than simply recording the financial transactions.

If you apply in a big corporation and had an accounting job before, you can also say that you prefer to try both approaches , and that after working as an accountant you’d like to try FP&A. Then you will be ready to progress to a position of a controller, or finance manager.

Please tell us more about yourself.

They do not specify what you should talk about—the choice is yours. And while some interview coaches say you should stay strictly work-related in your answer, I do not agree with their advice . You should simply focus on your strengths , while trying to make a g ood initial connection with the people in the room. What does it mean?

Your strengths depend on your situation in an interview. If you’ve been working as a financial analyst for four years already , or had your own accounting business before applying for this job, or if you have a degree from some Ivy League university, it makes sense to talk about such things—your education and experience is your greatest strength. But if the only position you had before was a part time role with KFC , or some side-hustle you did online, while focusing on your education, it doesn’t really make sense to talk about your working experience at length.

In such a case, you should focus on who you are, your goals and ambitions , and perhaps your abilities and personal traits , strengths that make from you a good applicant for the job in FP&A.

What’s more, it is always a good idea to share something from your personal life with the interviewers—whether you have a family, one or two hobbies you enjoy to do in your free time, and so on, just to show them that you have a life outside of work , and to demonstrate that you want to talk in an open and genuine manner in your interview…

How do you imagine a typical day in work in financial planning and analysis team?

The most important thing is to have a realistic idea of your day in work. Just like any other analyst or manager, you’ll spend a lot of time in meetings, answering emails, and doing other semi-productive tasks, many of them boring.

But you’ll spend also a significant amount of time working with profit-loss statement and cash-flow. Checking individual transactions, talking to employees responsible for them, and trying to identify any deviations, abnormalities, and trends , you’ll eventually come up with forecasts and recommendations for the company management.

Obviously the exact scope of your duties will differ from one company to another, and it also depends on your exact role within the FP&A team. If they run an entire department, you may respond just for a small part, for example analyzing certain types of transactions.

If you are the only fp&a employee, however, you’ll respond for everything I mentioned. And you will easily spend 60 hours in work each week . Or more…

How would you ensure to get your message over to people who do not understand financial terminology?

Ensure the interviewers that you do not mind stepping out of your comfort zone, explaining difficult things in a simple way. Say that you always try to adjust your language to the specialization, intelligence, and communication skills of your audience.

Using demonstration, PowerPoint presentations, and case studies and practical examples , you try to make the things simple to understand. Because you know that your work is useless, unless the others understand you…

What do you consider your biggest weakness in terms of fp&a?

You have several options for a good answer. First one is saying that you aren’t aware of any particular weakness that will restrain you from achieving great results in your work. That’s exactly the reason why you opted for financial planning and analysis, and not for some other occupation.

Second is picking something that is somehow important, but isn’t central for the job. For example, say that you are slow with MS Excel or SAP, that you lack efficiency when working with the software. Elaborate on your answer, saying that you are aware of your weakness, and hope that practice makes perfect , and that you will improve your efficiency with the software, once you start the job.

Another option is saying that you simply do not know. Surely, there are some things you can improve on, but you have to do the job first for a few weeks , to be able to tell exactly what your weaknesses are–and then you will improve on them…

Other questions you may face in an FP&A interview

* Behavioral (or situational) questions examine your attitude to various work-related situations. You will certainly get at least some of them in each interview in a big corporation . Most of the questions in the list below belong to this group…

• Describe a conflict you had with one of your colleagues.
• Tell me about an obstacle you overcame.
• Describe a situation when you used logic to solve a problem.
• Tell us about a time when you had to meet a tight deadline.
• Have you ever worked on a project that was a failure?
• Describe a crisis of motivation you faced. How did you overcome it?
• Give an example of a time you showed initiative at work.
• In your opinion, what are the current trends in FP&A?
• What are the most common challenges we face in FP&A right now?
• What was the best financial forecast and the worst financial forecast you have made in your career?

Special tip : If you aren’t sure how you’d answer the questions , or experience anxiety, but really want to succeed in your interview, have a look at a new eBook I wrote for you, the FP&A Interview Guide . Several sample answers to all 25 most common FP&A interview questions will help you streamline your preparation for this important meeting, make a great impression on the hiring managers, and eventually secure a new FP&A Analyst or Manager employment contract. You will find some excellent sample answers directly on the product page , so it makes sense to check it out even if you do not plan to purchase anything…

Technical questions in an fp&a interview

Whether you will deal with any technical questions, and the level of their difficulty, depends on several factors. The most important one is the specialization of your interviewer.

If it’s an HR Generalist, or HR manager, or a recruiter from some general agency, they won’t ask you any technical questions. Or just a few simple questions. They won’t ask you, since they do not have the capacity to assess the accuracy of your answers to technical questions .

If you apply for an entry level job in a big corporation , you typically won’t face any technical questions either. Such corporations have excellent training programs . You will learn the technical stuff before starting the job.

They care more about your general intelligence, communication skills, motivation, and attitude to work. These are tested with a different set of questions (personal and behavioral).

Interview with an expert

However, if a senior analyst, accountant, or financial manager leads your interview, or if you apply for a lone FP&A vacancy in a corporation, you may get some technical questions .

Once again, their difficulty depends on the knowledge and experience of your interviewers , as well as on your future role in the company (and the level of independence you’ll have in the job). We analyze most of them in the eBook , here is a short selection:

• What is your favorite financial modeling methodology, and why?
• What profitability models have you used for forecasting a project?
• Are you familiar with developing business casing and ad-hoc analysis?
• How do you model operating expenses for a company?
• Here is our income statement, balance sheet, and cash flow statement for the last year. You have ten minutes to study the documents. Try to find any discrepancies, or give us any recommendations based on the numbers you see on the documents.

Special Tip : You can also download the full list of questions in a one page long .PDF , print it, and practice your interview answers anytime later:

Conclusion and next steps

Interview for a job of FP&A Analyst, or of FP&A Manager, belongs to difficult job interviews . It goes about a popular job field, and you will typically compete with many other people for the position.

What is more, interviewers will test you with a set of personal , behavioral , and sometimes also technical questions . Short case studies are nothing uncommon, especially if we talk about job interviews in big corporations.

Try to prepare for the questions. Success in this interview is not a question of luck. Unless you prepare well, you cannot expect to outclass the other job candidates and get the job… And if you’d like to get some professional help, consider checking out my eBook, FP&A Interview Guide . Thank you, I wish you best of luck!

Matthew Chulaw, Your personal interview coach

May also help you :

• Financial Controller Interview – Overseeing an entire accounting department of any middle sized or big corporation is not a small task, and you will have to pass a tough one to get this job.
• How to handle interview nerves – Feeling anxious? Learn how to get rid of your interview stress.
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The Tesla Financial Analyst Interview Guide

Walk through the Tesla financial analyst interview process and learn how I landed a job with Tesla’s FP&A Business Operations team.

Introduction

In this article, Michael (former FP&A and Business Operations Analyst at Tesla), will walk you through the steps he took to land a full-time analyst role at Tesla. This guide will cover the various stages of the interview process alongside general notes, tips, and sample interview questions and answers.

#1 Passing the Resume Screen

Tesla received 3 million job applications in all of 2021. This may sound a bit daunting, but there are several different things that you can do to squeeze past this first obstacle.

Clean Up Your Resume

First, you need to clean up your resume and tailor all of your experiences to best fit the financial analyst role or whichever role you are applying for.

Tesla is an innovative, technology-driven company that likes seeing people use data to make logical business decisions. Keep this in mind when tuning up the bullets in your resume.

When writing the experience section of your resume, you should make sure to start each bullet with an action verb. This will help cut down the excess “fluff” in your resume and make it easier for recruiters to understand your previous tasks and experiences.

Sample Action Verbs:

• More Action Verbs

In addition to using action verbs, you should quantify your resume as much as possible so that you clearly state how you added value to your previous companies. For example, you can change “Reduced product line wait time” to “Reduced product line wait time by 3 seconds resulting in a 15% increase in production efficiency.”

For more details and tips, check out our other article on how to write the perfect resume .

Try to Obtain an Employee Referral

With thousands of applications flowing into Tesla each day, an employee referral would certainly help bring your resume to the top of the stack.

Now if you don’t have any existing friends or connections that work at Tesla, you can try to use LinkedIn and cold emails to contact an existing employee to ask for a quick phone call.

When scrolling through your LinkedIn network, try to look for your school alumni and ideally people who work on the finance team or the team that you are applying to. The goal is to hop on a phone call with your connection so that you can learn more about the working roles at Tesla and demonstrate a genuine interest in the company.

For those looking to better their chances of a referral, we recommend you check out our article on Networking Cold Email Templates.

#2 Phone Screen

If you make it past the resume screen, then congratulations, you’ve made it past the largest cutting stage of the application process.

Following the resume screen, you’ll likely have to hop on a call with one recruiter and one or two finance managers. These calls are quite straightforward and very behavioral-focused. Although they seem quite simple, it will be important to give off a good impression and to make your interviewers believe that you will be a good fit on one of their teams.

Preparation Tip: Read Up on Tesla News

• Spend an hour reading online articles on Tesla. Finance-oriented publications like CNBC , The Financial Times , and Bloomberg are great places to start.
• Watch YouTube videos on recent company stories. Tesla has its own channel and Rob Maurer also runs a very informative YouTube channel called the Tesla Daily .
• Read Tesla’s 10-K annual report. Every public company is required to post a publicly available 10-K company report . I’d recommend taking a look at the section on “Risk Factors” and “Management Opportunities, Challenges, and Risks.” (These sections are perfect for coming up with interesting follow-up questions that you can ask your interviewer).

Sample Questions & Answers

The following should give you an idea of the types of questions that you may be asked in these phone screen interviews.

Q: Why do you want to work for Tesla?

Sample Answer:

“Tesla seems to be a very dynamic and innovative company. With this in mind, I figured that this type of work exposure, particularly at the junior level, would be extremely rewarding as I would be forced to learn many things in a rapid environment. Although this may seem daunting for some, I’ve always been the type to throw myself into challenging situations to force myself to figure things out. Tesla has made tremendous progress since its first factory opening in Fremont, California and I’d simply love to take part in its massive global mission.”

Q: Where do you see yourself in 5 years?

“It’s hard to answer that question specifically as 5 years is quite a long time. What I can say is that I would like to spend the first few years of my analyst career learning the little details and all the ins and outs of the business. Then, after building up my fundamentals and overall experience, I would like to transition into a role that would allow me to make thoughtful and impactful business decisions.”

Q: What do you like to do outside of work and school?

“I really enjoy going fishing when I have some free time over the weekend. Although it seems like fishing is a relatively relaxed activity, I actually really enjoy the strategic side of a fishing operation. Whether it's looking a weather and wave height reports or researching specific species and testing different baits and fishing equipment, I actually really enjoy the process of testing out different theories to find what works best for me.”

#3 Excel Case Study Interview

If you make it past the phone screen stage, you’ll likely move on to an Excel case study interview. To prepare for this Excel case study test, I recommend you make sure you are comfortable with basic Excel skills and finance fundamentals.

Excel: In my case study, I ended up using simple formulas like SUMIFS and VLOOKUPS and I didn’t have to use pivot tables or macros. That said it certainly wouldn’t hurt to learn pivot tables and other Excel functions as they’ll likely switch up the case studies every now and then.

Finance: The Excel case study (at least when interviewing for the financial analyst role) is very much finance oriented. At a minimum, make sure you understand the ins and outs of an income statement so that you can comfortably solve for gross and net profit margins, EBITDA, etc.

General Tip: They will likely ask you for your insights or recommendations given the figures and data available. If certain figures or assumptions seem a bit high, perhaps you could recommend the analyst to speak with the manufacturing team or distribution team for more details on mandatory vs optional expenses (this makes it seem like you are familiar with real work scenarios).

If you’re interested in learning more about how you can best prepare for your interviews, consider checking out our Excel for Business & Finance Course and our Complete Finance & Valuation Course . These two courses should help you comfortably tackle finance interviews at the most competitive corporations and investment banks!

#4 Final Round: 4-5 Back-to-Back 30-Minute Interviews

If you make it past the Excel case study test, you’ll likely have an opportunity to take part in a final round interview consisting of 4-5 back-to-back 30-minute interviews with members from various finance teams.

These interviews will consist of mostly technical and brain teaser questions. With this in mind, you should expect to open up Excel during the interview to share your screen and walk through mini case studies and teaser problems.

General Tip: Once you find a reasonable solution, don’t just stop at the numerical answer. The interviewer wants to see how you can connect the data to actionable business ideas. You’ll usually want to make some surface-level assumptions to arrive at a figure, then tell your interviewer the types of follow-up questions you would ask if you had more time to work on this in a real business setting.

You should also expect a couple of behavioral questions at the end of the interview alongside an opportunity to ask the interviewer general questions.

The following should give you an idea of the types of problem-solving questions that you might be asked in the final round of interviews.

Q: Tell me 3 different methods that you could use to price a Tesla car entering a new market?

• You can use a competitive pricing model. Simply put, you can look up the prices of competing cars in the new market and price the Tesla car within a certain range of its competitors (maybe plus or minus 5%). It will also be interesting to factor in any potential tax benefits that some countries give to electric vehicle consumers as that could give Teslas a big pricing edge over traditional combustion engine vehicles.
• You can use a cost-based pricing model. In this method, you can add up all the costs required to manufacture and distribute a vehicle. Then you can apply a percentage premium to that cost basis to arrive at the consumer-facing price. Perhaps you could use some industry-standard or comparable markup figure to determine the percentage premium to use.
• You could create a model based on customer income. In this method, you could start by looking at all of the existing markets, and create a ratio using the Tesla prices in those markets relative to the median family income in that area. Once you have that ratio, you can apply it to your new market by finding the median family income in the new area.

Q: Identify the bottleneck of the car manufacturing line given XYZ data

This question will likely require you to use simple math to figure out which stage in the production line is taking up the most time. Once you figure out the bottleneck, the interviewer might ask you a follow-up question modifying the figures of the original scenario.

For example, your interviewer might say: “If you were presented with the opportunity to invest $X amount of dollars to cut down the bottleneck time by 25%, would you proceed with the project?”

To approach this problem, you would likely have to calculate how much more product you would be able to produce and the dollar value of that additional product. From there, you could calculate the payback period or essentially how long it would take for the additional profits to cover the cost of the initial investment.

#5 Job Offer!

If you make it past the final round of interviews, congratulations, you’ll likely receive an email and a call from the HR team.

If you don’t get the job offer, don’t worry and keep your chin up. It’s already quite an accomplishment to make it to the final round of interviewers. Even if you don’t end up at Tesla, you can still apply to many other great companies like Apple, Amazon, Visa, and more.

If you're fishing around for a new job, consider signing up for our weekly newsletter for more career news and interesting job opportunities that we find at fortune 500 companies across the globe.

Additional Resources

If you’re looking to better prepare your technical skills for any competitive business or finance interviews, consider checking out our courses using the get started button below!

Other Articles You Might Find Useful

• Interview With a Tesla Financial Analyst
• Goldman Sachs Interview Process
• Investment Banking Target Schools
• Accounting Internships
• Goldman Sachs Interview Questions

Building a cash flow statement from scratch using a company income statement and balance sheet is one of the most fundamental finance exercises commonly used to test interns and full-time professionals at elite level finance firms.

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FP&A Analyst Interview Questions

The most important interview questions for FP&A Analysts, and how to answer them

Getting Started as a FP&A Analyst

• What is a FP&A Analyst
• How to Become
• Certifications
• Tools & Software
• LinkedIn Guide
• Interview Questions
• Work-Life Balance
• Professional Goals
• Resume Examples
• Cover Letter Examples

Interviewing as a FP&A Analyst

Types of questions to expect in a fp&a analyst interview, behavioral questions, technical and financial modeling questions, case study and scenario-based questions, business acumen and market awareness questions, preparing for a fp&a analyst interview, how to do interview prep as an fp&a analyst.

• Understand the Company's Financial Landscape: Research the company's financial statements, annual reports, and any available analyst reports. This will help you understand their revenue streams, cost structures, and financial health, enabling you to discuss their financial strategies knowledgeably.
• Brush Up on Financial Modeling and Analysis: Be prepared to demonstrate your proficiency in Excel, financial modeling, and data analysis. You might be asked to solve a case study or perform an impromptu analysis, so practicing these skills is crucial.
• Review Key FP&A Concepts and Metrics: Ensure you're familiar with key financial concepts such as variance analysis, budgeting, forecasting, and key performance indicators (KPIs) relevant to the industry.
• Prepare for Behavioral Questions: Reflect on your past experiences and be ready to discuss how you've contributed to financial decision-making processes, handled budget discrepancies, or improved financial reporting in your previous roles.
• Understand the Role of Technology: FP&A roles increasingly rely on technology. Familiarize yourself with common FP&A software and tools, and be ready to discuss how you've used technology to improve financial processes.
• Develop Insightful Questions: Prepare thoughtful questions that demonstrate your interest in the company's financial strategies and your role in shaping them. This could include questions about the company's growth plans, investment strategies, or challenges in financial planning.
• Practice with Mock Interviews: Conduct mock interviews with a mentor or professional in the field to get feedback on your responses and to refine your communication skills, especially when explaining complex financial concepts.

Stay Organized with Interview Tracking

FP&A Analyst Interview Questions and Answers

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FP&A Analyst Job Title Guide

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Driving financial strategy and growth, ensuring fiscal health and sustainability

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FP&A interview questions: a cheat sheet for landing the next FP&A role

Professional development.

Updated: October 31, 2023 |

Billy is an expert in the FP&A space. Before joining Cube at the seed stage, Billy found success as a tax advisor at companies like Grant Thornton LLP and Gemini.com. He holds a BA and MA in Accounting from William & Mary and splits his time between NYC and New England.

If you’re looking to break into FP&A, there’s never been a better time.

If you want to get in the door with a corporate finance department, you’ll need to prepare for a wide range of interview questions. These questions allow hiring managers to learn about your background and skills, but also about your creative reasoning and interpersonal skills. 

While we can’t cover everything an interviewer might ask, we’ve compiled a list of common questions you’ll encounter at an FP&A interview. 

In this article, you’ll learn:

• The qualities that make up a great FP&A candidate
• Interview questions for interns, analysts, and managers
• Technical questions to consider in advance

Ready to flex your interview muscles? Read on.

Billy Russell

FP&A Strategist, Cube Software

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What qualities do hiring managers look for in FP&A candidates?

While you're expected to know the basics of financial planning , financial modeling, and other ways to determine a company's financial health, the best candidates have a suite of soft skills in addition to their technical knowledge.

Let's take a look at some of them.  

Finance skills

A foundational understanding of finance and accounting practices is the cornerstone of a career in finance. While specializations such as advanced Excel and FP&A software skills can be learned on the job , a strong grasp of the basics is required. 

Be ready to address questions about your finance skills and look for opportunities to discuss your analytical process.  

Cross-functional skills

Many FP&A candidates come from different backgrounds in the professional world. Some are looking for a new challenge, while others are attracted to the numbers and processes behind operational success in their former departments. 

Managers often seek cross-functional skills in well-rounded candidates who can understand business challenges from multiple perspectives.

Creative thinking and curiosity

Curiosity is a defining characteristic of a high-quality FP&A candidate. Much of planning and analysis requires complex problem-solving skills. The best problem solvers are both naturally curious people and outside-the-box thinkers. 

Hiring managers look for candidates with creative thinking skills—those who always need to know “why.” Curiosity is a valuable asset to an organization.

Interpersonal “soft” skills

Finance professionals don’t hide behind their spreadsheets. In the modern Finance organization, analysts and managers must be skilled communicators. They must be able to communicate ideas, collaborate with other leaders on solutions, educate decision-makers, and gain consensus on a course of action. 

Showcase your interpersonal and leadership skills during the interview, and look for opportunities to weave examples into your interview answers.

Sample questions for every type of FP&A interview

Prepare to answer a range of questions during your interview. Depending on the hiring manager, they may ask a series of questions to determine your analytical skills, technical knowledge, creative thinking, and team mindset. Here are some examples of questions and the rationale behind them. 

FP&A intern interview questions

If you want to know how to break into FP&A with an internship or an entry-level position, the secret is to find ways to demonstrate the skills necessary for the role. While you may have little or no FP&A experience, find ways to demonstrate your analytical, presentation, and communication skills in applicable ways. 

How will your educational background aid you in this internship?

Be prepared to discuss your current coursework. This is especially important if you are looking for strategic finance internships from outside of a finance or accounting curriculum. Give examples of how analytics and critical thinking integrate into your coursework. 

Why pursue an FP&A internship versus accounting or another discipline?

Are you interested in business or accounting but exploring planning  and analysis as part of your major? Be specific about why an FP&A job interests you. Share examples of your interest in planning  and analysis, as well as showcase any cross-applicable skills.

How strong are your Microsoft Excel skills? 

Strong skills are a huge benefit when working within a Finance organization. Although many FP&A software tools exist, many professionals still prefer to work within spreadsheets for much of their analysis. Having advanced chops in Excel is a valuable skill. 

Tell me about X

You're expected to know the basics of what financial analysts do and the types of financial statements you'll encounter on the job. Be prepared to talk about core concepts like:

• Creating a simple financial model
• The three financial statements (Income statement, Balance sheet, and Cash Flow Statement )
• Capital assets
• Capital expenditures
• Fixed and variable costs
• Operating expenses
• Assessing a company's current financial position
• Financial planning
• The qualities of a good Excel model
• What about accounts payable?
• What are accounts receivable?
• What is non-cash working capital?

It's always a good idea to come prepared with an analysis of the company's market share based on the data available to you. For example, even though you don't have access to that company's historical data or last year's revenue, you can talk in hypotheticals.

FP&A analyst questions

At the analyst level, you're expected to be proficient at creating a financial model from a budget and manipulating financial data .

You should be able to talk about how models interact with each other. For example, many models forecast operating expenses. Can you interpret that model and explain its effect on a company's cash flow?

You're expected to have a solid understanding of the three financial statements: the income statement, the balance sheet, and the cash flow statement.

Likewise, you're expected to understand the core essentials of financial planning. 

What do you consider your biggest weakness in terms of FP&A?

Most candidates are happy to showcase their strengths during the interview, so this question creates opportunities to see how they talk about their less-developed skills and areas of expertise. This question also allows an interviewer to see where skill gaps might appear and what enrichment opportunities might be helpful to the successful candidate.

Remember that because FP&A degree programs are few and far between, most FP&A training is on the job. So this is a good time to talk about the circumstances of your current or previous positions and what you never got to work on. If you were never able to model operating expenses or create a forecast model because your team was highly segmented in terms of responsibility, you should talk about how you'd like to learn those skills in this new position.

If you're applying to work at a company with a new type of revenue model or offer, there's a lot to talk about here. If your previous company was SaaS but your new company has warehouses of products they sell, you'll encounter new questions that you previously never had to answer, like "how does inventory write-down affect cash flows?"

Tell me about a time you disagreed with a boss or other superior.  

Complex financial modeling may present opposing viewpoints about how to move forward through a challenge. As an analyst, part of the candidate's job will be communicating and educating on their analyses.

The best candidate will have the analytical skills to produce accurate analysis, confidently propose solutions, educate on the facts of the situation, and act as a strategic partner up and down the organization. 

It's important to have a well-thought-out answer to this question. Spend some time before your interview thinking about how you'd approach this if asked.

Have you ever worked on a project that failed? How did you handle it?

It’s often said we learn more from our failures than our successes. This question allows the interviewer a window into your thought process when things don’t go as planned. 

how the process you used to arrive at your conclusions, any circumstances affecting the outcome, and what you took away from the experience. 

What do you think is the most desirable quality of an FP&A analyst?

There are many answers to this question, and whichever you pick will reveal something about your perception of the FP&A role. Analytical ability is an essential prerequisite for analysts, but creative thinking and problem-solving are also valuable. Presentation skills are another vital aspect, allowing you to communicate your results and recommendations clearly and effectively. 

Project management skills, leadership, and communication skills are other avenues to consider in answering. Your answer to this question will give your interviewer a window into your potential skill fit and culture fit with the company. 

What should you do if you find issues with a model or forecast? 

This could be a question about technical skills or soft skills, and answering both aspects will provide valuable insight into your work style. Ask for specifics about the issues and use any detail the interviewer provides in forming your answer. 

FP&A manager questions

At this level, you should not only understand how to model revenues and assess future business needs, but you should also be able to assess both internal and external challenges facing a business.

Likewise, at the manager level, you should expect to lead a finance team . You should also have opinions on the overall strategic direction for FP&A—your FP&A philosophy, as it were. 

What are the most common challenges FP&A departments currently face?

This question provides a broader context for your finance knowledge within the wider world. It shows that you spend time researching the economic and global impacts on businesses and demonstrates that you possess an interest in the subject beyond the technical functions of the job. 

How do you communicate with stakeholders that have limited finance knowledge?

Finance professionals in a modern business environment must be educators. Translating detailed information into a usable format for many different audiences is an important skill. Many finance professionals invest time and resources in expanding their communication skills along with their analytical skills for this reason. Demonstrate to your interviewer that you can communicate effectively across the organization and to internal and external audiences.

Can you tell me about the biggest challenges we face as a company currently?

Like the question about general FP&A challenges, this question is a chance to demonstrate your deep understanding of the finance function. In this case, you’ll also demonstrate that you’ve done your homework about the company and its financials. This question serves as a check against your interest in the role, as well as your communication and analysis skills. 

Be sure to talk about both internal and external challenges in this answer. Not only should you do your best to evaluate future business, but you should also talk about the company's market share and its trajectory for growth.

Being able to create hypotheses without access to historical data and draw conclusions about external challenges based on what you can observe in the market shows you're a smart candidate. It'll take you far in the interview process.

How would you describe your management style? 

Finance managers must be able to guide and support their analysis team throughout their careers, providing guidance, mentorship, and leadership. Discussing your management style in specific allows the interviewer to visualize how you will fit within the larger organization. It also demonstrates your ability to navigate interpersonal relationships, provide balanced leadership, and work as part of a team. 

How do you engage employees in the process?

Like management style, your ability to provide guidance and enrichment for staff is a vital part of the team's health. Discuss your views on peer leadership, skip-level management and mentorship, career road mapping, and advancement opportunities. Discuss ways to build a culture within the Finance function, and ensure the FP&A team has a seat at the table in the broader organization. 

FP&A technical interview questions

Acing the technical questions is required to show a candidate's ability to do the job of the FP&A analyst. The FP&A interview will as you about the basics of FP&A like cash flow, net income, variable costs, how to create a quarterly forecast model, and how to model working capital.

You should demonstrate some familiarity with the most common FP&A tools and prepare answers to the questions we've listed below, most of which relate to forecasting.

What planning tools and platforms are you familiar with? 

While you can pick up platform skills on the job and familiarize yourself with them before the interview, it’s always nice to have some knowledge of the tech stack. Be prepared to discuss your level of familiarity with financial planning and analysis software.

Check the job description for any required systems and be prepared to discuss them. It's always a good idea to familiarize yourself with the most common FP&A tools on the market, including:

• Adaptive Planning by Workday
• Vena Solutions

As well as the common ERP systems:

• Sage Intacct

Even if you've never used these tools, demonstrating that you're familiar with their relative trade-offs will go a long way toward appeasing the hiring manager.

What are the three financial statements and their importance?

The ability to clearly define and discuss the income statement, balance sheet, cash flow statement, and their interaction is table stakes for most FP&A jobs. Be prepared to demonstrate your knowledge of how these essential documents come together.

You should also be prepared to discuss how these financial statements are used to create financial reports, forecast revenues, and report on a business's financial performance.

Be prepared to discuss other information (like shareholders' equity).  

What forecasting techniques have you had experience using? 

As with the financial statements, you should be prepared to discuss forecasting techniques : their uses, strengths, and applications. Likewise, take time to share your understanding of top-down versus bottom-up models of forecasting.

Showing you have a broad and deep computational skill set will set you apart from candidates with less specialized skills. 

How do you record PP&E, and why is this important?

Handling changes in fixed and long-term assets in the balance sheet requires appropriate calculation and care.

Demonstrating knowledge of proper classification and management of PP&E assets, knowledge of depreciation, capital expenditures, repair, and replacement, etc. demonstrates your proficiency in dealing with these items on the balance sheet.  

How do you create a rolling forecast? 

Versatility and a ready toolbox of techniques are essential for FP&A professionals at every level. Possessing the technical knowledge to construct a rolling forecast shows that you can adapt your approach to the company's needs.

Communicating this information to your interviewer shows that you have both the technical grasp and the communication skills to work effectively in the department. 

Conclusion: ace the next FP&A interview

Consider the above questions, spend some time practicing your answers (to yourself or with a mock interview helper) and you’ll be well prepared to step into a financial analysis role you’ll love.

Hiring for an FP&A position or need help finding an FP&A job? Check out our Slack community full of FP&A pros.

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Top 20 FP&A Interview Questions and Answers

Are you interviewing for a Financial Planning & Analysis (FP&A) role and looking for guidance? In this blog post we’ll provide an overview of the common interview questions that you may be asked along with some tips and answers to help you ace your interview.

Financial Planning & Analysis is an integral part of the decision-making process in any organization. Companies rely on FP&A professionals to provide them with a comprehensive view of their financial position and to help make well-informed decisions. As a result, interviews for FP&A positions are often quite rigorous, with a variety of questions designed to test your knowledge and experience with financial planning and analysis.

Our blog post will provide you with a comprehensive overview of the types of questions you might encounter in your FP&A interview, including questions about your experience with financial analysis and planning, budgeting, forecasting, and more. We’ll also provide some tips for answering these questions, as well as example answers to give you an idea of how to approach and answer the questions you’ll likely face. With these resources, you’ll be equipped to put your best foot forward and successfully navigate your next FP&A interview.

Overview of FP&A Interview Process

The Financial Planning and Analysis (FP&A) interview process typically begins with a phone or video interview. This is a chance for both the interviewer and the candidate to get to know each other and learn more about the role and the company. The interviewer may ask questions about the candidate’s experience, qualifications, and background.

The next stage of the FP&A interview process is usually an in- person interview. During this phase, the interviewer will usually ask more in- depth questions about the candidate’s knowledge and skills. The interviewer may also ask questions about the candidate’s understanding of financial concepts and their experience with budgeting and forecasting.

In the final stage of the interview process, the interviewer may ask the candidate to complete an FP&A case study. This may involve creating a budget or forecasting a financial statement. The interviewer will use this case study to evaluate the candidate’s analytical and problem- solving skills.

Once the interview process is complete, the interviewer will provide feedback to the candidate and may make a hiring decision. If selected, the candidate will be asked to provide documentation of their qualifications and to complete a background check. After the background check is complete, the candidate will be offered the position and asked to accept or decline the offer.

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Top 20 FP&A Interview Questions and Answers

1. what does fp&a stand for.

FP&A stands for Financial Planning and Analysis. It is a type of department within a business that is responsible for providing financial insight and analysis to help inform decision making. This includes creating financial models, forecasts, and budgets to help the business understand its current financial picture and plan for the future. Additionally, FP&A departments work to ensure that the company is adhering to all applicable laws and regulations pertaining to financial matters.

2. What Is the Role of FP&A?

The role of FP&A is to provide financial analysis and insight to the business, particularly when it comes to optimizing the company’s financial performance. This includes creating financial models, forecasts, and budgets to help the business understand its current financial picture and plan for the future. Additionally, FP&A teams are responsible for monitoring the financial performance of the business, recognizing potential risks, and helping to develop strategies to improve performance. They are also responsible for ensuring that the company is adhering to all applicable laws and regulations pertaining to financial matters.

3. What Skills Does an FP&A Professional Need?

An FP&A professional needs a variety of skills to be successful. This includes financial analysis and modeling skills, as well as the ability to interpret financial data and develop meaningful insight. Additionally, it is important for an FP&A professional to have strong communication and problem-solving skills to be able to effectively communicate their insights to those within the company. Finally, it is beneficial for an FP&A professional to have knowledge of accounting principles and an understanding of applicable laws and regulations pertaining to financial matters.

4. What Are the Benefits of a Successful FP&A Department?

The benefits of a successful FP&A department are numerous. First, a successful FP&A team is able to provide meaningful insight and analysis to the business that can help optimize the company’s financial performance. Additionally, a successful FP&A team is able to recognize potential risks and develop strategies to mitigate those risks. Finally, a successful FP&A department can help ensure that the company is adhering to all applicable laws and regulations pertaining to financial matters.

5. How Does FP&A Work With Other Departments?

FP&A works with other departments in a variety of ways. First, FP&A teams can provide financial insight and analysis to other departments in order to help them make more informed decisions. Additionally, FP&A teams can work with other departments to help develop strategies to improve the company’s overall performance. Finally, FP&A teams can provide feedback and guidance to other departments to ensure that they are adhering to all applicable laws and regulations pertaining to financial matters.

6. How Do You Develop and Monitor Financial Models?

To develop a financial model, an FP&A professional needs to have a thorough understanding of the company’s financial picture. This includes understanding the company’s current financial performance and analyzing historical data to develop an understanding of the company’s past performance. Once this is established, the FP&A professional can begin to develop the financial model by forecasting future performance based on anticipated changes in the market, industry, and company. To monitor the financial model, the FP&A professional should compare the actual performance of the company to the forecasted performance. This allows the professional to identify any discrepancies between the two and make adjustments to the model as needed.

7. What Is the Difference Between Financial Planning and Analysis?

Financial planning and analysis are two distinct functions within an FP&A department. Financial planning involves forecasting and budgeting for the company’s future performance. This includes developing strategies to optimize the company’s financial performance and planning for potential risks. Financial analysis, on the other hand, involves analyzing the company’s current financial performance and identifying potential areas of improvement. The goal of financial analysis is to provide insight and recommendations that can help the company improve its performance.

8. What Are the Core Responsibilities of an FP&A Professional?

The core responsibilities of an FP&A professional include creating financial models, forecasts, and budgets to help the company understand its current financial picture and plan for the future. Additionally, FP&A professionals are responsible for monitoring the financial performance of the company and recognizing potential risks. Finally, they are responsible for providing insight and recommendations to help optimize the company’s financial performance and developing strategies to mitigate risks.

9. How Do You Implement Financial Changes Based On Your Analysis?

Implementing financial changes based on one’s analysis is a multi-step process. First, the FP&A professional should develop a plan for implementing the recommended changes. This includes identifying the resources and personnel needed to implement the changes as well as any potential risks associated with the changes. Once the plan is in place, the FP&A professional should communicate the plan to the relevant stakeholders and ensure that everyone is on the same page. Finally, the FP&A professional should monitor the implementation of the changes to ensure that the changes are being implemented in an effective and efficient manner.

10. What Are the Key Performance Indicators (KPIs) That FP&A Professionals Track?

Key performance indicators (KPIs) are metrics that are used to measure the performance of a company. Common KPIs that FP&A professionals track include financial metrics such as revenue, profit margin, and return on investment (ROI). Additionally, FP&A professionals may track non-financial metrics such as customer satisfaction or market share. By tracking these metrics, FP&A professionals can provide insight into the company’s performance and identify potential areas of improvement.

11. What is your experience in financial planning and analysis?

My experience in financial planning and analysis began when I joined a small startup as the financial analyst. In this role, I was responsible for analyzing historical financial data, developing budgeting and forecasting models, and preparing presentation materials. I have since moved on to a larger organization, where I am now a senior financial analyst. In this role, I am responsible for providing detailed financial analysis and insights, developing short and long-term forecasts, and leading special projects. I am experienced in a variety of financial analysis methods and reporting tools, as well as working with senior management to ensure their financial objectives are met.

12. How do you stay organized when dealing with multiple tasks?

When dealing with multiple tasks, I prioritize and plan my tasks carefully. I ensure that each task has a clear goal and that I am able to track the progress of each task. I also make use of task management tools to ensure that I stay organized and on track. Additionally, I make sure to allocate my time efficiently and plan for any potential challenges that I may face. Finally, I am open to feedback and take advantage of any opportunities for professional development to help me stay organized and efficient.

13. What challenges have you faced in FP&A?

I have faced a number of challenges in the field of financial planning and analysis. Some of the most common challenges include developing accurate forecasts, managing data and creating meaningful insights, and managing relationships with other departments. To overcome these challenges, I have developed a proactive approach to my work. I am constantly seeking opportunities to improve my understanding of the financial data and develop more accurate forecasting models. Additionally, I strive to build strong relationships with other departments to ensure that we are all working towards the same goals.

14. How do you stay up to date with the latest financial trends?

In order to stay up to date with the latest financial trends, I make sure to stay informed about the latest news and research in the field. I regularly read industry publications and attend events to stay in tune with what is happening in the market. Additionally, I am constantly seeking out new tools and resources that can help me gain insights into the financial trends. Finally, I am proactive in attending educational events such as seminars and conferences to further develop my expertise in the field.

15. What methods do you use to analyze financial data?

I use a variety of methods to analyze financial data, depending on the purpose of the analysis. For basic trend analysis, I typically utilize simple statistical methods such as correlation or regression analysis. For more complex analyses, I use more sophisticated methods such as Monte Carlo simulations or Monte Carlo tree search. Additionally, I make use of software such as Microsoft Excel or Tableau to develop complex models or to visualize the financial data.

16. How do you identify risk and potential areas for improvement in financial plans?

When assessing financial plans, I look for potential risks and areas of improvement by examining the financial data and trends in the market. I also use a variety of analysis methods such as regression or Monte Carlo simulations to identify potential risks or areas of improvement. Additionally, I review financial plans from a macro perspective to identify any potential external risks that could affect the financial plan. Finally, I am always open to feedback and willing to adjust my approach if needed.

17. What strategies do you use to present financial information?

When presenting financial information, I typically use a variety of strategies. First, I make sure to explain the main points of the information in a clear and concise manner. Second, I use visuals such as charts and graphs to better represent the data and make it easier to understand. Third, I use storytelling techniques to bring the data to life and keep the audience engaged. Finally, I make sure to follow up with any questions or concerns that arise so that the audience is able to fully understand the financial information.

18. How do you ensure the accuracy of financial forecasts?

When creating financial forecasts, I ensure accuracy by doing a thorough analysis of the data and considering historical trends. Additionally, I use a variety of analysis methods such as Monte Carlo simulations or Monte Carlo tree search to identify any potential risks or discrepancies in the data. Furthermore, I conduct sensitivity analysis to ensure that the forecasts are realistic and achievable. Finally, I am always open to feedback and willing to adjust my approach if needed.

19. What tools and software do you use in your role?

In my role as a financial analyst, I make use of a variety of tools and software. Some of the most common tools that I utilize are Microsoft Excel, Tableau, and Power BI. These tools offer powerful features that allow me to quickly analyze financial data and create meaningful insights. Additionally, I use a variety of other software such as Bloomberg or Capital IQ to access real-time financial data and industry news.

20. What do you consider to be the most important aspect of financial planning and analysis?

I believe that the most important aspect of financial planning and analysis is accuracy. Financial decisions can have serious consequences, so it is important to make sure that the data and analysis are accurate. Additionally, it is important to be able to identify potential risks and areas of improvement in the financial plans. Finally, it is essential to be able to communicate the financial information in a clear and concise manner so that all stakeholders are able to understand the implications.

Tips on Preparing for a FP&A Interview

• Research the company and its financials: Before attending a FP&A interview, it is important to research the company and its past financial performances. This will help you to understand the company’s financial position and the challenges it is currently facing.
• Understand the job requirements: Before the interview, review the job description and requirements carefully. Make sure you are familiar with the job details and its tasks.
• Practice your financial skills: Practice your financial skills, such as forecasting, budgeting, variance analysis, and financial modeling. Make sure you are comfortable with these financial tools and can demonstrate them during the interview.
• Prepare a portfolio: Create a portfolio of projects you have worked on. This will help you to demonstrate your financial acumen and show what value you can bring to the table.
• Prepare questions: Before attending the interview, write down a list of questions you can ask the interviewer. This will show your enthusiasm for the job and your interest in the company.
• Rehearse answers to commonly asked questions: Research and practice commonly asked FP&A interview questions. This will help you to be more confident and prepared for the interview.
• Dress professionally: Dress appropriately for the interview. Remember that you are trying to make a good impression on the interviewer.
• Be prepared to discuss salary and benefits: Be prepared to discuss your salary requirements and the benefits you are looking for.
• Make sure to follow up: After the interview, make sure to send a thank you letter or email to the interviewer. This will show your appreciation and interest in the position.

Overall, FP&A interviews require a unique set of skills and qualifications that can be challenging to master. Preparing for an interview with thorough research and practice can give you an edge over other candidates. Being familiar with the different types of questions that can be asked and knowing how to answer them can help you feel more confident. Finally, make sure to keep a positive attitude and show enthusiasm for the role and company to make a good impression.

Navigating the FP&A Analyst Interview: Essential Questions and Expert Tips

Financial Planning & Analysis (FP&A) analysts play a vital role in an organization's financial health by forecasting performance, identifying trends, and supporting strategic decision-making. As a candidate for an FP&A analyst position, you'll need to showcase not only your technical expertise in financial modeling and data analysis, but also your ability to communicate insights effectively and collaborate with cross-functional teams. Here are some sample FP&A analyst interview questions and tips on how to structure your answers.

Background and experience:

Can you tell us about your education and relevant work experience in FP&A?

• Highlight relevant coursework and degrees, such as finance or accounting
• Discuss any internships or entry-level roles in finance or accounting
• Discuss any experience with budgeting, forecasting, or financial analysis

Can you describe your experience with budgeting and forecasting?

• Discuss any tools or software used for budgeting and forecasting, such as Vareto
• Provide examples of successful budgeting and forecasting projects
• Explain any challenges faced during the budgeting and forecasting process and how they were overcome

Can you walk us through your approach to financial planning and analysis?

• Explain how you gather and analyze data
• Discuss any frameworks or models used for financial planning and analysis
• Provide examples of how financial planning and analysis has informed decision-making

Can you give an example of a difficult problem you faced in your FP&A role and how you solved it?

• Explain the problem and its impact
• Discuss the steps taken to solve the problem
• Highlight any creative solutions or approaches taken

Can you tell us about a particularly challenging budgeting or forecasting project you worked on?

• Explain the project and its goals
• Discuss any challenges faced and how they were overcome
• Highlight any unique or creative solutions used to complete the project

Technical skills:

How do you handle complex financial modeling projects?

• Discuss experience with financial modeling
• Explain any financial modeling software used
• Provide examples of complex financial models created

Can you explain your experience with financial analysis software and tools?

• Discuss experience with financial analysis software, such as Excel or Vareto.
• Explain any custom functions or macros created
• Provide examples of financial analysis projects

Can you give an example of how you have improved processes in your FP&A role?

• Explain the process improvement
• Discuss the impact of the improvement
• Highlight any cost savings or increased efficiency

How do you ensure the accuracy of your financial reports and analysis?

• Discuss any internal controls or checks used
• Explain how data is verified and validated
• Provide examples of accuracy checks performed

Can you talk about a time when you had to make a difficult decision based on your financial analysis?

• Explain the decision
• Discuss the financial analysis used to inform the decision
• Highlight any risks considered or mitigated

Communication and collaboration:

Can you walk us through how you communicate financial information to non-financial stakeholders?

• Discuss experience with communication and presentation skills
• Provide examples of financial information presented to non-financial stakeholders
• Explain how technical financial information is translated into actionable insights

How do you approach collaboration and communication with cross-functional teams?

• Discuss experience working with cross-functional teams
• Explain how communication is managed with team members with varying levels of financial knowledge
• Provide examples of successful cross-functional projects

Can you give an example of how you have presented financial information in an impactful and compelling way?

• Discuss experience with data visualization
• Explain the approach used to present financial information
• Provide examples of presentations that had a significant impact

Can you talk about a time when you had to present financial information to senior leadership or a board of directors?

• Discuss the specific financial information that was presented
• Explain the purpose and goals of the presentation
• Highlight any key insights or recommendations communicated
• Discuss the format and style used for the presentation (e.g. slides, data visualization, etc.)
• Mention any challenges faced during the presentation and how they were addressed
• Discuss the impact of the presentation and any follow-up actions taken
• Explain any feedback received from senior leadership or the board of directors
• Highlight any improvements made to future presentations based on the experience
• Emphasize the importance of clear and effective communication of financial information to senior leadership or board of directors.

Industry knowledge and adaptability:

How do you stay up-to-date with the latest industry trends and advancements in technology?

Can you tell us about a project you worked on that required creative problem-solving?

How do you balance short-term and long-term financial planning and analysis?

How do you prioritize and manage your workload in a fast-paced environment?

Can you explain a complex financial concept to someone without a financial background?

Confidentiality and ethics:

How do you maintain the confidentiality and security of sensitive financial information?

Can you talk about a time when you had to adhere to strict regulatory requirements or financial reporting standards?

How do you approach ethical considerations in your FP&A work?

Can you give an example of how you have ensured compliance with financial policies and procedures?

Alignment with company goals:

How do you ensure the alignment of your FP&A work with the goals and objectives of the organization?

• Mention the key steps taken to understand the organization's goals and objectives
• Explain how you prioritize your work to align with the organization's priorities
• Discuss any methodologies used to ensure alignment, such as balanced scorecards or performance metrics
• Highlight the importance of regular communication with stakeholders to stay informed and aligned
• Emphasize the role of continuous improvement in aligning FP&A work with organizational goals

Can you talk about a time when you had to align your financial analysis with a specific business initiative or project?

• Describe the specific business initiative or project and its objectives
• Explain how your financial analysis supported the initiative or project
• Highlight any key insights or recommendations communicated as a result of the analysis
• Discuss the impact of the analysis on the initiative or project
• Emphasize the importance of collaboration and coordination with relevant stakeholders

How do you incorporate market and economic trends into your financial planning and analysis?

• Explain the methodologies used to monitor and analyze market and economic trends
• Highlight the importance of considering these trends in financial planning and analysis
• Discuss any tools or technologies used to incorporate trends into financial models
• Explain the role of market and economic trends in informing financial projections and risk management
• Emphasize the importance of continuous monitoring and adaptation to changing market and economic conditions

Can you describe your experience with scenario planning and risk management?

• Give high-level introduction to previous experience with scenario planning and risk management
• Explain the methodologies and techniques used for scenario planning and risk management
• Highlight any relevant tools or technologies used for scenario planning and risk management
• Discuss the importance of considering multiple scenarios in financial planning and analysis
• Explain the role of scenario planning and risk management in informing strategic decision-making.

Team dynamics:

Can you talk about your experience working with a team in an FP&A role?

• Give a high-level introduction working with a team in an FP&A role
• Explain your leadership style and how it supports effective team collaboration
• Highlight any successes achieved through teamwork in an FP&A role
• Discuss the importance of clear communication and setting expectations with team members
• Emphasize the value placed on continuous improvement and professional development for team members

How do you handle conflicting priorities and tight deadlines with your team?

• Explain the methodologies used to prioritize and manage conflicting priorities
• Discuss the importance of clear communication and collaboration with team members
• Explain the steps taken to ensure deadlines are met
• Highlight any tools or processes used to manage workload and ensure efficiency
• Emphasize the importance of balancing competing priorities to achieve overall success

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Financial Services Case Interview: 4 Tips on How to Pass

• Last Updated May, 2024

A good case structure will get through any consulting case interview question. But some industries have specific issues that make it a lot easier to pass the case if you know what to expect. Financial services case interviews are like that.

Government regulation of financial institutions, their corporate structure, and business models are quite different from other industries, so it’s good to brush up on the financial services industry before facing a case.

In this article, we’ll discuss:

• Differences between financial services firms and other firms.
• Common types of financial services case interviews.
• A financial services case example.
• 4 Tips on acing your financial services case interview.

Let’s get started!

Differences Between Financial Services Firms & Other Firms

Financial services case interview example, common types of financial services case interviews.

5 Tips On Acing Your Financial Services Case Interview

Financial services firms don’t make cars or serve hamburgers to customers to generate revenue the way an auto company or a fast-food restaurant does. Instead, they provide retail customers (individual consumers – people like you and me) and businesses with loans, deposit accounts, or insurance policies. Or they help them invest their money in stocks, bonds, or other financial instruments.

Corporate Structure

There are many different types of financial institutions and they exist both on paper (e.g., online banks) and in actual brick-and-mortar form (e.g., retail bank branches with ATMs). Typical financial institutions include:

• Commercial banks (provide business loans, home mortgage loans, and savings/checking accounts)
• Investment banks and securities firms (help people buy and sell stocks and bonds and help companies issue them)
• Insurance companies (provide insurance for homes, cars, business risk, health, etc.)
• Mutual funds and pension funds (manage retirement savings or savings for other goals, e.g., education, health, etc., by investing it in stocks, bonds, and other assets)
• Microfinance companies (provide small loans to populations underserved by traditional financial institutions)

Businesses that “make stuff” have a factory where parts go in one end and cars or hamburgers go out the other. Financial institutions, on the other hand, have people who handle the bank accounts, stocks purchases/sales, or insurance products that they provide, and all the investment decisions and paperwork that go with that service.

Business Model

Unlike other sectors, the financial services industry’s business model is largely based on interest, fees, and premiums. Don’t get bogged down by the variety of products and services that a financial institution has to offer. You only need to remember:

• Key income sources: interest earned by selling retail and corporate loans, premiums earned on insurance policies, fees earned on financial advisory (e.g., stockbroking) or on deposit accounts, etc.
• Key costs: interest paid on deposits from retail investors and corporates, insurance claims/payouts, branch operations, manpower, SG&A, etc.

Always confirm and validate the drivers of revenue and cost with your interviewer before jumping to solving any financial services case.

Regulation and Risk

A well-functioning financial system is vital for the economy, businesses, and consumers. When a financial institution fails, it can create problems for the wider economy as the 2007-2009 financial crisis showed us. Financial services firms, therefore, attract high levels of scrutiny and oversight.

Government regulation helps make sure that these institutions have good management so they don’t make bad investments or become too risky. They require that financial institutions hold “shock absorbers” (i.e., capital) to help deal with bad investments. Each country has its own set of norms and regulations that create the framework and operating model for financial institutions.

In a financial services case, therefore, it’s always important to include regulation as a category in your issue tree. You can check with your interviewer on which aspects of financial regulation and risk are relevant to ensure that ideas you brainstorm in the case won’t break laws. Aligning on this upfront increases your credibility with the interviewer, but regulation is not typically the focus of the case.

Nail the case & fit interview with strategies from former MBB Interviewers that have helped 89.6% of our clients pass the case interview.

Financial services cases can include revenue growth, cost reduction, or new product introduction like they would for any other industry. They can also include managing the “back office” where financial account information is maintained or stock and bond trades are cleared.

Here are some financial services case interview examples:

• Disconsa – A McKinsey case on developing better financial service offerings for a not-for-profit entity serving remote Mexican communities.
• Internet Bank – An L.E.K. case on product diversification for a large insurance company in Europe.
• Big Bucks Bank – A Deloitte case on technology transformation for a large US-based bank.
• Bank of Zurich – A Deloitte case on developing a strategy to structure the organization’s data program.

We’ve also curated a list of case examples , to help you hone your business problem-solving skills. Head to Our Ultimate Guide to Case Interview Prep to learn what a case interview is and its various stages (i.e., opening, structure, analysis, and conclusion). The best way to get smarter about answering financial services case interview questions is to master this general four-part approach first and then apply financial services specifics as appropriate.

Let’s dive into a financial services case example.

Case Question

“Your client is Go-for-Growth bank, a large bank in a frontier market that wants to rapidly build its agent network to grow revenue for its payment and banking business. How should they go about it?”

First, repeat the main information in the prompt to the interviewer to make sure you got it right, and ask clarifying questions. If you don’t know what a frontier market is or who banking agents are, ask your interviewer.

Frontier market is a classification made by Standard & Poors, a financial rating agency, that’s used to classify less advanced economies in the developing world, e.g., Vietnam, Kenya, Nigeria, Cambodia, etc.

A banking agent is a retail or a postal outlet contracted out by a financial institution (in this case Go-for-Growth bank) to process clients’ transactions. Typically, in less advanced economies, the population has little access to banks but significantly higher interaction with establishments such as pharmacies, grocery stores, post offices, and beauty salons. The agents help the banks get new customers and typically make money on commissions.

Take a moment to develop your own hypothesis for the Go-for-Growth bank case.

Financial Services Case Hypothesis

Your hypothesis could be that a banking agent is a cost-efficient way for the bank to acquire customers and distribute financial products vs. having to set up their own branches across the country (including paying rent for office space and hiring staff in each location).

Next, validate your understanding of the bank’s business model, corporate structure, and applicable regulations. Here, the bank is a traditional commercial bank that wants to add agents as a channel to acquire retail customers and sell traditional financial products and services (e.g., loans, deposits, etc.) Building an agent network is allowed within the regulatory framework of the country.

A great candidate would also establish:

• The purpose of agent acquisition: “Why agents?” “Why now?” and “What is the size of the opportunity (or market) that the bank is chasing?” Here, the interviewer can confirm your hypothesis about agents being cost-efficient vs. Go-for-Growth Bank having to set up brick-and-mortar establishments.
• The size of the opportunity: Establishing an agent network is a big undertaking so it’s worth ensuring the opportunity size is big enough to justify the cost. In this case, the total opportunity size is $3 billion given the country is largely underpenetrated with only 10-20% of the total population of 100+ million having access to financial services, so the opportunity is worth it. (Note that to make this a short case or one that would be appropriate for undergrad summer interns, sizing the market could be the sole focus.)
• The client’s key success metrics : “What does success look like to Go-for-Growth Bank?” Here, you should clarify the target network size and the target timeframe to meet the client’s growth target. Say, your interviewer adds that they want to scale up to a size of 200,000 agents in 2 years to achieve the topline impact of $3+ billion.

You’d now ask for a minute to lay down your thoughts so that you can build your structure.

Take a moment to think about how you would structure this case before reading ahead. That will give you a sense of what business issues come naturally to you in a financial services case and where you need to push your thinking further.

Here’s a sample case structure:

• Which services/revenue streams should Go-for-Growth Bank market via the agents and to which end customers?
• Which of the existing products and services are most profitable?
• Which products and services don’t need extensive training for agents to sell?
• Which products and services best meet the needs of the customers who agents serve (e.g., payments and basic deposit accounts and loans, not more sophisticated financial products).
• Is there a segmentation of customers who should be targeted by the agents?
• Will the bank need to tweak their products to make them profitable to customers acquired through the agent network? (An A+ answer would note that clients with low incomes or lumpy earnings might need bank accounts with lower minimums.)
• Is there opportunity for cross-sell/ up-sell of products to customers?
• How to reach the agents? (sales force/feet on the ground vs. email campaign)
• How to get them interested in becoming a channel partner? Will one-time, up-front incentives be required?
• What is the process to get them on board?
• What cut can be given to the agents (so the bank continues to be profitable)?
• What will be meaningful for the agents?
• Can gamification reward schemes be introduced?
• Would certification or co-branding, such as a sticker to display the agent’s affiliation with Go-for-Growth Bank, appeal to potential agents?
• What banking products can be sold to the agents?
• Can the agents be offered discounted pricing on the products?
• What is the up-front effort/cost to acquire agents?
• What is the expected revenue or profit uplift per agent to the bank?
• How much should each agent sell annually/monthly to continue being profitable to the bank?
• What are the recurring costs to maintain the agent network?
• Which metrics should be used for tracking performance?
• Can low performers be segmented further based on their potential?
• What will be the plan of action for consistent low-performing agents?
• Which training(s) and products’ brochures should be offered to agents to keep the customer conversion rate high?
• How can we create a community within the agent network to provide product information updates and support agency retention (such as Facebook or WhatsApp groups)?
• How can we set up the right operating model for providing cash to agents as needed?
• How can we make sure the agents have the right processes in place to ensure Go-for-Growth Bank’s cash is safeguarded?

This structure is quite exhaustive. Don’t worry if you didn’t have every bullet point in your structure. In practice, since you only have about 2 minutes to lay this out, you don’t need to write full questions on your piece of paper but only a couple of keywords for each bucket and each sub-bucket.

We recommend going through our article on Issue Trees to learn more about how to create a case structure.

After you lay out your case structure, your interviewer would prompt you to brainstorm which agents to acquire and which products and services to sell, so if you’ve already alluded to it in your structure, that gives you a headstart.

Here, your interviewer would hand you a few exhibits that detail population density by region, classification of the retail stores with metrics on annual revenue, footfall, etc., a list of Go-for-Growth Bank’s products and the associated profitability of each product, and the results of a survey that details the wishlist of financial services and products by underserved consumers and small businesses.

On brainstorming ideas, you’ll be rated on both your structure and your creativity. Make sure to always articulate the logic behind your ideas, using your past experience, analogies, or your general knowledge.

Ideas for Increasing Go-for-Growth Bank’s Revenue

• Target the agents that receive the highest customer footfall (grocery stores) AND/OR agents that are well-versed in handling legal/administrative documentation (postal outlets). Let’s assume the bank can cover 60% of the untapped population by acquiring grocery stores and postal outlets as agents in the Tier 2 cities.
• Sell products that are profitable to the bank and at the same time relevant to the customers (payment transfer, insurance products, working capital loans, home loans, etc.)
• Onboard agents as customers first to establish other customers’ trust in the bank’s products. Given it’s a less advanced economy where customers rely on heavy interactions with retail stores for information on financial products, word-of-mouth from the agent will establish trust upfront and lead to longer lifetime value (LTV) for the bank.

Ideas on Incentives for Agents

• Provide commission to agents of 0.15% on each insurance/loan product.
• Organize monthly or quarterly leagues with leaderboards to recognize top performers, e.g., highest transaction value, highest growth, highest customer acquisition, etc.
• Leverage social media to build an agent community via Facebook or WhatsApp groups. These groups can create engagement and serve as an efficient mode of communication, allowing the bank to solicit agent referrals and publish leaderboards.
• Introduce friendly competitions like “Best shop-front display” to increase the visibility of Go-for-Growth Bank’s products.
• Test if affiliation with the Bank’s brand in the country is a motivator for agents.

You could classify “high performers” as agents with transaction volume and transaction value in the top 10%. Agent’s potential information (e.g., footfall, turnover, location potential) can also be collected to have a more nuanced segmentation for tracking and governance purposes.

Running the Numbers on Go-for-Growth’s Agent Strategy

Finally, you should consider pressure testing the unit economics of each agent to ensure the bank’s targets are met. To do this, you’ll need to leverage the information you were provided during the opening of the case as well as make some assumptions. A quick way to round this up would be:

• Total # of customers = % of population targeted * Annual conversion rate per agent = 60% of population targeted * 10% conversion rate = 60% * (80% [% of population currently underserved by financial institutions] * 100 million [total population]) * 10% [conversion rate]= 4.8 million customers
• Revenue per customer = Avg # of banking products sold per customer * Annual price per product = 1.5 avg # of products * $500 price 1 = $750 annual revenue per customer.

1 Based on data from interviewer.

• Therefore, Topline impact = 4.8 million * $750 = $3600 million = $3.6 billion (validated as this meets the $3+ billion target)

Keep drawing on the interviewer to test the assumptions and/or ask for industry benchmarks on conversion rates, average number of products, prices, etc. to make your analysis rigorous.

A great candidate would also establish bottom line impact for the bank:

• Total bottom line opportunity = Topline opportunity * Profit margin = $3.6 billion * (5-7% profit margin – 0.15% cut to agents) = $175 to $250 million.

“Go-for-Growth Bank’s CEO walks into the team room and asks you about your findings. What do you tell her?”

You should lead with your recommendation to the client and detail the key reasons supporting that recommendation. Then, mention any risks to consider which might impact the outcome and the next steps that you’d suggest to double down on the analysis. There is no need to repeat everything you covered during the case: be succinct and stick to the key arguments.

What would you say? Give it a try before reading ahead.

“We recommend acquiring the grocery stores and postal outlets in the Tier-2 cities as agents for the bank to help sell loan and insurance products at a profit margin of 5-7% to retail and small business clients with a 0.15% cut to the agents. This way, we cover 60%+ of the underpenetrated population with our highest profitability products and provide an additional source of income to the agents at no additional cost to them. The high perceived value in being affiliated with the Go-for-Growth Bank brand will attract agent interest. This will allow us to add $3 billion to the top line and $175-$250 million to the bottom line annually.

One concern we’d like to address next is whether competitors could potentially take away our first-mover advantage by luring away agents with better commissions, especially in densely populous areas. We should address this potential problem with contract terms and incentives in our agent agreements.”

Congrats, you made it through your first financial services case interview!

4 Tips On Acing Your Financial Services Case Interview

1. validate corporate structure and business model.

Always remember to validate the corporate structure and business model of the financial institution in your financial services case interview. You don’t want to end up confusing a commercial bank with an investment bank!

As a candidate, you’re not expected to know everything. Therefore, ask as many questions as possible to understand what you’re really dealing with. For instance, you could say, “Hey, I’m not familiar with the corporate structure and the business model of a pension fund, could you please explain that to me so I can start to understand the drivers of value for the business a bit better.”

2. Align on the Success Metrics

To be able to reach your destination, you must know what the destination is. This is especially relevant in the financial services case interview, where there could be dozens of metrics that can be solved for. Therefore, it’s critical to align on the North Star with your interviewer so you can solve for the target the client cares most about.

3. Apply First-Principles Thinking to Structure the Case

To navigate through a financial services case interview, you need to think on your toes. Chances are the corporate structure, business model, regulatory environment, and risk aspects will be unfamiliar to you. Instead of feeling bogged down by these nuances, take a big picture lens and apply first-principles thinking to structure the case.

You may not know the industry terms such as “net interest margin” or “dividend-adjusted return,” but you can always ask the first-principles question on “What drives value for the business?” and engage with your interviewer to identify the underlying sources of value.

Demonstrating intellectual curiosity in financial services cases will hold you in good stead. Start with “Why?” then get to the “What?” and only then solve for “How?”

4. Remain Calm and Confident

It’s easy to lose nerve when you’re out of your comfort zone. If financial services case interviews tend to throw you off, practice staying calm while solving the case. During your practice, monitor yourself for signs of nervousness. Pause, take a deep breath, smile, and then continue solving the case. The more practice you put in, the calmer your nerves will become. Also, include elements such as reading financial news, financial statements, etc., into your case prep so that you become familiar with industry terminologies. Incorporating these habits into your holistic practice will boost your confidence naturally.

– – – – –

In this article, we’ve covered:

• Key differences between financial services firms and other firms,
• Common types of financial services case interviews,
• A financial services case interview example, and
• 4 tips on acing your financial services case interview.

Still have questions?

If you have more questions about financial services case interviews, leave them in the comments below. One of My Consulting Offer’s case coaches will answer them.

Other people prepping for consulting case interviews found the following pages helpful:

• Our Ultimate Guide to Case Interview Prep
• Issue Trees
• Market-sizing Case Interview
• Revenue Growth Case Interview
• Cost Reduction Case Interview
• Pricing Case Interview
• Supply Chain Case Interview

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FP&A Challenges and 4 FP&A Case Study Examples to ...

FP&A Challenges and 4 FP&A Case Study Examples to Follow

Businesses are taking longer than ever to complete their financial planning and analysis activities. These teams are being asked to do more with less - less time, fewer resources, lower budget. But that is achievable - with the right tool. To that end, we’ve compiled a list of FP&A case study examples with companies who solved time-consuming FP&A, saving hundreds of hours.  

We’ll go over some FP&A best practices and how, with the right FP&A solutions and techniques, you can improve the speed, accuracy, and functionality of your financial planning and analysis tasks.

FP&A Challenge: Budgeting Takes Too Long

As mentioned above, businesses are spending more and more time on FP&A activities – especially budgeting and reporting, leaving no time to forecast. 

While you would think that advances in technology would actually make these tasks faster, the wrong tools can in fact actually slow down your process.

Excel, for instance, is a great FP&A tool . . . at first. When you run a small business with only a single or handful of departments, revenue streams, and budgets, Excel, well, excels at helping you keep your financial data organized.

But as an organization grows in size, this FP&A process grows in complexity.

One or two teams balloon into a dozen different teams, each with different budgets and reporting processes. Add in additional revenue streams and you only further complicate the matter. 

Let’s jump into our FP&A case study examples so we can better illustrate how the right FP&A software can solve your legacy financial planning and analysis issues. 

FP&A Case Study #1: Communication Services for the Deaf

The non-profit Communication Services for the Deaf found that its team was spending an enormous amount of time tracking down data, scrolling through thousands of Excel rows, and using its finance team’s valuable time to perform repetitive tasks which could all be better completed by an algorithm.

And with the right FP&A solution, they were able to reduce the time it took to complete their annual budgeting process in half.

They accomplished this through automating the process with FP&A software – read more here .

FP&A Challenge: Insufficient Planning and Forecasting Capabilities

When using your financial data to plan and forecast, as your organization transitions from a smaller outfit to a larger company, Excel again becomes unsustainable due to the frequent need to copy data over and over again across multiple what-if scenarios and other forecasting efforts.

In order to leverage financial data, in other words, to gain valuable insights that can then translate into effective and accurate forecasting models, what’s needed is a centralized deposit of all the relevant data that displays information in real-time – which is one of the FP&A challenges that is impossible to overcome without the right solution.

FP&A Case Study #2: MedVet

MedVet has a number of emergency and specialty veterinary hospitals designed to keep pets feeling healthy. During the pandemic, even with a difficult economic climate, MedVet was able to add dozens of more hospitals. And this growth was helped by their FP&A software platform , which cut budgeting cycles in half, made their FP&A activities scalable, and were able to leverage long-term planning and forecasting using accurate, real-time data.

MedVet was so impressed with their FP&A solution, they chose to give a webinar detailing their experience with their FP&A software, Limelight, which you can watch here . Read more here .

FP&A Challenge: Lack of Automation Capabilities 

Many FP&A teams – experts in finance with troves of knowledge on how to take financial data and turn it into actionable insights that increase ROI - spend far too much time sifting through spreadsheets and wrangling teams to send in their data. 

This is an inefficient use of their time, leading to productivity losses at your organization; this is one of the biggest FP&A challenges, in fact. 

FP&A Case Study #3: Triple Crown Sports

Triple Crown Sports had its finance team sifting through spreadsheet after spreadsheet to ensure data integrity and consolidate all the information - taking them away from higher ROI FP&A activities. 

But with FP&A software, they were able to consolidate over one hundred spreadsheets into a single, cohesive, easily accessible FP&A platform and workspace. 

By automating data consolidation, collection, and updating, Triple Crown Sports created a connected workspace that restores your experts’ time, allowing them to take on and complete more productive FP&A activities. 

This led to a minimization of manual tasks and restored hundreds of hours to their teams. Read more here . 

FP&A Challenge: Dozens of Budget Reviews

Reviewing budgets can be a time-consuming, unnecessary process. One of the main reasons for this is that these spreadsheets are disjointed or incomplete caused by many teams inputting data at different times and creating different budget versions. This then necessitates data integrity verification, which in turn calls for multiple budget reviews. And every time a discrepancy is discovered, this can impact multiple figures, thus resulting in further budget reviews after the initial one is complete to ensure the changes didn’t impact the overall numbers. 

FP&A Case Study #4: GSW Manufacturing

GSW Manufacturing often faced nearly 30 budget reviews when preparing its budgets. Now, however, the company only has to create a single budget. As you’d imagine, this reduces frustration and saves the valuable time of its FP&A team.

When calculating intercompany eliminations and roll-ups, the corporate team would review the budget several times during a cycle to verify data integrity. 

By implementing the right FP&A solution, it was able to ensure both data integrity and accuracy, and make smarter business decisions with its financial data. Through that process, the company was able to uncover over $400,000 in hidden costs . Read more here .

Solve Your FP&A Challenge with Limelight FP&A Software

FP&A challenges can be time-consuming and frustrating - but you don’t have to suffer through them. Instead, you can leverage Limelight cloud FP&A software to totally eliminate legacy issues that have plagued your FP&A teams. 

Work with an FP&A platform that supports your budgeting, forecasting, planning, and analysis activities so they are carried out faster - and more accurately - than ever. With our sophisticated FP&A platform supporting your business, you can reduce budgeting and reporting times by 50% while uncovering hundreds of thousands in hidden costs, reduce budget reviews, and give your team its time back. 

Book a demo to see our FP&A platform in action.

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47 case interview examples (from McKinsey, BCG, Bain, etc.)

One of the best ways to prepare for   case interviews  at firms like McKinsey, BCG, or Bain, is by studying case interview examples. 

There are a lot of free sample cases out there, but it's really hard to know where to start. So in this article, we have listed all the best free case examples available, in one place.

The below list of resources includes interactive case interview samples provided by consulting firms, video case interview demonstrations, case books, and materials developed by the team here at IGotAnOffer. Let's continue to the list.

• McKinsey examples
• BCG examples
• Bain examples
• Deloitte examples
• Other firms' examples
• Case books from consulting clubs
• Case interview preparation

Click here to practise 1-on-1 with MBB ex-interviewers

1. mckinsey case interview examples.

• Beautify case interview (McKinsey website)
• Diconsa case interview (McKinsey website)
• Electro-light case interview (McKinsey website)
• GlobaPharm case interview (McKinsey website)
• National Education case interview (McKinsey website)
• Talbot Trucks case interview (McKinsey website)
• Shops Corporation case interview (McKinsey website)
• Conservation Forever case interview (McKinsey website)
• McKinsey case interview guide (by IGotAnOffer)
• McKinsey live case interview extract (by IGotAnOffer) - See below

2. BCG case interview examples

• Foods Inc and GenCo case samples  (BCG website)
• Chateau Boomerang written case interview  (BCG website)
• BCG case interview guide (by IGotAnOffer)
• Written cases guide (by IGotAnOffer)
• BCG live case interview with notes (by IGotAnOffer)
• BCG mock case interview with ex-BCG associate director - Public sector case (by IGotAnOffer)
• BCG mock case interview: Revenue problem case (by IGotAnOffer) - See below

3. Bain case interview examples

• CoffeeCo practice case (Bain website)
• FashionCo practice case (Bain website)
• Associate Consultant mock interview video (Bain website)
• Consultant mock interview video (Bain website)
• Written case interview tips (Bain website)
• Bain case interview guide   (by IGotAnOffer)
• Digital transformation case with ex-Bain consultant
• Bain case mock interview with ex-Bain manager (below)

4. Deloitte case interview examples

• Engagement Strategy practice case (Deloitte website)
• Recreation Unlimited practice case (Deloitte website)
• Strategic Vision practice case (Deloitte website)
• Retail Strategy practice case  (Deloitte website)
• Finance Strategy practice case  (Deloitte website)
• Talent Management practice case (Deloitte website)
• Enterprise Resource Management practice case (Deloitte website)
• Footloose written case  (by Deloitte)
• Deloitte case interview guide (by IGotAnOffer)

5. Accenture case interview examples

• Case interview workbook (by Accenture)
• Accenture case interview guide (by IGotAnOffer)

6. OC&C case interview examples

• Leisure Club case example (by OC&C)
• Imported Spirits case example (by OC&C)

7. Oliver Wyman case interview examples

• Wumbleworld case sample (Oliver Wyman website)
• Aqualine case sample (Oliver Wyman website)
• Oliver Wyman case interview guide (by IGotAnOffer)

8. A.T. Kearney case interview examples

• Promotion planning case question (A.T. Kearney website)
• Consulting case book and examples (by A.T. Kearney)
• AT Kearney case interview guide (by IGotAnOffer)

9. Strategy& / PWC case interview examples

• Presentation overview with sample questions (by Strategy& / PWC)
• Strategy& / PWC case interview guide (by IGotAnOffer)

10. L.E.K. Consulting case interview examples

• Case interview example video walkthrough   (L.E.K. website)
• Market sizing case example video walkthrough  (L.E.K. website)

11. Roland Berger case interview examples

• Transit oriented development case webinar part 1  (Roland Berger website)
• Transit oriented development case webinar part 2   (Roland Berger website)
• 3D printed hip implants case webinar part 1   (Roland Berger website)
• 3D printed hip implants case webinar part 2   (Roland Berger website)
• Roland Berger case interview guide   (by IGotAnOffer)

12. Capital One case interview examples

• Case interview example video walkthrough  (Capital One website)
• Capital One case interview guide (by IGotAnOffer)

13. Consulting clubs case interview examples

• Berkeley case book (2006)
• Columbia case book (2006)
• Darden case book (2012)
• Darden case book (2018)
• Duke case book (2010)
• Duke case book (2014)
• ESADE case book (2011)
• Goizueta case book (2006)
• Illinois case book (2015)
• LBS case book (2006)
• MIT case book (2001)
• Notre Dame case book (2017)
• Ross case book (2010)
• Wharton case book (2010)

Practice with experts

Using case interview examples is a key part of your interview preparation, but it isn’t enough.

At some point you’ll want to practise with friends or family who can give some useful feedback. However, if you really want the best possible preparation for your case interview, you'll also want to work with ex-consultants who have experience running interviews at McKinsey, Bain, BCG, etc.

If you know anyone who fits that description, fantastic! But for most of us, it's tough to find the right connections to make this happen. And it might also be difficult to practice multiple hours with that person unless you know them really well.

Here's the good news. We've already made the connections for you. We’ve created a coaching service where you can do mock case interviews 1-on-1 with ex-interviewers from MBB firms . Start scheduling sessions today!

The IGotAnOffer team

Gartner Insights for FP&A leaders

Download now here

By Aurélien Nolf , VP, Head of FP&A at Lyft

In the world of Financial Planning and Analysis (FP&A) , where reporting numbers and creating budgets are often the focus, a transformative skillset that can elevate finance professionals to a more strategic position also exists. It is storytelling . The ability to craft a compelling narrative around financial and operational metrics is not just nice to have anymore; it’s a powerful tool that can drive decision-making and ultimately redefine the role of FP&A professionals.

We’ll discuss the key aspects of storytelling in the context of FP&A, highlighting the importance of defining the most relevant metrics, maintaining consistency, and understanding the importance of data visualisation .

Defining the Best Metrics

Before even thinking about telling a story, the FP&A team must collaborate with other business units to align on the most relevant financial and operational metrics that will be tracked.

There should only be a limited number of relevant metrics for any business. Their number is not likely to be less than 5 for a given line of business (profit centre) or a department ( cost centres), and it can be up to 20 for a corporation. These key metrics should be the only ones that are indispensable to drive the business and track progress against the long-term or the annual plan.

Remember, it’s not just about collecting data . It’s about selecting the relevant metrics that align with the organisational goals and reflect its unique journey.

For instance, such metrics as revenue growth, profitability ratios, and operational efficiency are fundamental, but their relevance can vary across industries. A tech startup might prioritise user acquisition costs and customer lifetime value, whereas a manufacturing company may focus on production yield and supply chain efficiency. So, the first step in effective FP&A Storytelling is to choose metrics that resonate with the organisation’s specific strategy and objectives.

Consistency in Tracking and Reporting

Once the right metrics are identified, the next step is to make sure that these metrics are:

• Available on a real-time or very regular basis. If the right metrics have been selected, the business and FP&A teams need to constantly monitor them. Using the right system, like a data lake, storing all the operational and financial metrics in one place with a reporting tool layered on top will be crucial.
• Referenced in every document: reporting pack, sales update, post-mortems.
• Used for the investment or deal greenlight/approval process. Any dollar invested in the business should serve to improve one of these key metrics.
• Leveraged for business and team members’ performance reviews. We have to aim most of the organisation’s efforts, such as investment, resource allocations, and the team’s focus at improving these metrics and overall business performance. That is why it is important to tie the performance assessment to these measures.

Consistent reporting not only fosters transparency but also builds trust among stakeholders. Whether it’s monthly reports, quarterly reviews, or annual presentations, maintaining a consistent approach enhances the predictability of the narrative. It allows decision-makers to focus on the nuances of performance rather than grappling with changing reporting methodologies.

How To Leverage These Metrics and Tell a Story

The next step is to leverage these metrics to develop a narrative. Storytelling is the vehicle through which FP&A professionals communicate the significance and implications of financial and operational metrics. It involves weaving a compelling narrative beyond your data, providing context and meaning to the numbers.

Understand Your Audience

To craft an impactful story, FP&A professionals must understand their audience. Different stakeholders have various interests and levels of financial acumen. Executives might be more interested in strategic insights, while operational teams may seek actionable takeaways. Tailoring the narrative to resonate with the audience ensures that the story is not only heard but also understood and appreciated. The worst approach is to show just numbers and metrics without crafting a narrative around “the why” .

Emphasising the “Why” Behind the Numbers

Storytelling is not just about presenting facts; it’s about explaining the ‘why’ behind the numbers. Why did a particular metric change? What are the driving forces behind the financial performance? FP&A professionals can transform into data interpreters, guiding stakeholders through the intricacies of financial and operational landscapes if they address these questions.

The Importance of Format and Visualisation

Format and data visualisation play a pivotal role in your story. No matter how accurate, numbers can be overwhelming without the right presentation. FP&A professionals must adopt a visually engaging approach that can help simplify complex data and highlight key insights.

Different stakeholders prefer different formats. While executives might appreciate concise executive summaries, operational teams may benefit more from detailed dashboards . FP&A professionals need to tailor the format to the preferences and needs of their audience. Whether it’s a visual presentation, interactive dashboard, or a written report, the chosen format should enhance comprehension and engagement.

A mentor introduced me to the concept of the 6X6 rule. Try to stick with the boundaries of a maximum of 6 rows down and 6 words across for each slide. It eliminates the volume of words on a slide and allows you to focus on key ideas instead of complete sentences. If you have so much on the slide, the audience can read and understand the entire point. In summary, less is more.

Visualisation goes beyond charts and graphs; it’s about telling a story visually. Heatmaps, trendlines, and comparative analyses can bring data to life, making it more relatable and memorable. The strategic use of colour, size, and positioning can emphasise critical points, guiding the audience’s attention to key insights. Again – stay concise and focus on the key metrics.

Case Study: Lyft

At Lyft, our mission is to improve people’s lives with the world’s best transportation. We gather and use a phenomenal amount of data in many different systems to operate in a very complex marketplace. We are matching tens of millions of riders with millions of drivers to deliver hundreds of millions of rides every year in a safe, timely and cost-efficient manner. At first, access to information was difficult. We had many reconciliation issues, and most of the effort was spent on just being able to produce data.

The team was overly focused on lagging indicators such as P&L, margin per unit, etc., instead of leading indicators: our key operational metrics tracking supply/demand/conversion, etc.

In 2023, our IT, Rev Ops, and FP&A team underwent a significant effort to:

• curate/select the 18 key metrics we will use consistently as a business,
• design (in-house) a unique reporting platform that gives real-time access to these metrics to everyone across the business, and
• consistently report against these metrics at each organisational level.

In the dynamic landscape of FP&A, the ability to tell a compelling story around financial and operational metrics is a game-changer. It goes beyond presenting numbers; it involves selecting the right metrics, maintaining consistency, understanding the audience, and adopting effective formats and visualisations. FP&A professionals who master the art of storytelling can become not only data analysts but strategic communicators, guiding organisations and supporting business leaders.

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Preparing for a GALE Partners Interview: Top Questions and Answers

To be the best design and consulting firm known for giving employees the tools they need to do their jobs, building trusting relationships, and giving clients practical solutions that meet their specific needs.

GALE Partners is a leading digital marketing and advertising agency known for their data-driven and innovative approach. With a focus on leveraging technology and analytics, GALE has established itself as a sought-after firm for top talent

Landing a job at GALE Partners can be highly competitive so it’s important to prepare for the various interview questions you may encounter. This article provides an in-depth look at some of the most common GALE Partners interview questions along with tips and examples to help you craft winning answers.

Overview of the GALE Partners Hiring Process

The GALE Partners interview process typically consists of:

• Initial phone screening with a recruiter
• Technical interviews assessing SQL, Python, machine learning skills
• Behavioral and situational interviews with team leaders and senior management
• Case study or presentation to evaluate problem-solving abilities

Some key qualities that GALE assesses include creativity, communication skills, analytical thinking, leadership potential, and cultural fit. The process is described as efficient and well-organized, though some candidates report instances of delays in communication or lack of feedback.

Top GALE Partners Interview Questions and Answers

1. how would you drive new client acquisition through innovative sales strategies.

This question tests your strategic thinking and ability to drive business growth. GALE wants to see that you can analyze markets, identify opportunities, and execute data-driven sales strategies tailored to those insights.

In your response, walk through a sales strategy you implemented successfully in the past. Explain the market analysis and research that informed your approach. Provide details on how you tailored messaging, content, and outreach channels to resonate with your target buyer personas. Share measurable results and metrics that convey the impact of your strategy, such as increased lead generation or new clients acquired. Emphasize how you optimized the strategy using data and analytics.

2. Tell us about a time you overcame ambiguity and made a complex executive decision.

GALE operates in fast-paced environments where acting decisively with incomplete data is key. This question evaluates your critical thinking, risk assessment, and decision-making abilities in uncertain situations.

Describe a specific scenario where you lacked complete information but needed to make a strategic call. Explain how you proceeded to gather as much relevant data as possible given the constraints. Discuss your methodology for weighing risks versus benefits. Share the logic behind your final decision and why you felt it was the right call given the situation. Reflect on the outcome and how that experience shaped your approach to decision-making with ambiguous information.

3. How would you set and track OKRs for your team to drive high performance?

This question tests your ability to align team efforts with broader goals and manage both qualitative and quantitative performance. GALE wants leaders who can motivate teams while maintaining focus on results and metrics.

In your response, explain your process for collaboratively setting Objectives and Key Results that align with company goals. Discuss how you track progress through tools like dashboards or regular check-ins. Share how you keep the team informed and engaged on OKRs while promoting transparency and collective ownership. Provide examples of how this approach has driven team performance in the past.

4. Walk me through how you have optimized budgets and controlled costs for past projects.

Budget management expertise is valued across many roles at GALE Partners. This question evaluates your financial analysis skills and how well you balance strategic priorities while maximizing value.

In your response, highlight examples of how you employed spend analysis, forecasting, and other methods to optimize budget utilization for a project or department. Share any specific strategies or tools you used to control expenditures, manage variances, and drive efficiencies. Use metrics to quantify the results and cost savings you achieved.

5. Describe a complex cross-functional project you managed from start to finish.

This question assesses your ability to manage multifaceted projects while coordinating across teams. GALE wants leaders who can deliver complex initiatives from inception to results.

Outline the project goals, timelines, and challenges involved in cross-departmental alignment or stakeholder management. Explain how you planned and sequenced deliverables, troubleshooted risks, and facilitated collaboration and communication across functions. Share successes in keeping the project on track. Quantify the end results and impact of your management approach.

6. How would you build a culture of innovation within a multifunctional team?

GALE Partners looks for leaders who can foster creativity, engagement, and collaboration within diverse teams. This question evaluates your understanding of culture building and innovation.

Share ideas and proven tactics for cultivating an encouraging environment where people feel empowered to think freely and have a voice. Discuss specific initiatives like ideation workshops, design thinking exercises, or hackathons that spur creative problem solving. Explain how you would reinforce innovation through metrics, processes, and leadership modeling while balancing it with accountability and business outcomes.

7. Tell me about a strategic business relationship you developed from initial outreach through driving growth.

Your ability to build partnerships that boost business is highly valued at consulting firms like GALE. This question probes your strategic networking acumen.

Walk through a specific example that illustrates your approach to identifying and cultivating mutually beneficial professional relationships. Discuss how you aligned objectives, communicated effectively, and drove initiatives that capitalized on synergies to increase revenue, market reach, or other growth metrics for both parties.

8. Describe a time you negotiated successfully with a difficult client.

Client management and negotiation expertise are necessities in consulting roles. This question evaluates your interpersonal skills in high-stakes situations.

Outline a scenario where you turned a contentious negotiation into a win-win outcome. Explain the client concerns and your process for understanding their perspective. Discuss how you asserted your position while gaining alignment through strategic concessions and persuasive communication. Share methods you used to develop rapport and mitigate conflicts. Quantify the end results you achieved.

9. How do you balance your time across conflicting priorities and assignments?

Excellent time management and prioritization abilities are key for succeeding at fast-paced consulting firms like GALE. This question assesses your skills in managing competing deliverables.

Describe your approach to assessing urgency and importance when faced with competing priorities. Share tools and frameworks you use to track and sequence tasks. Use examples of when you leveraged delegation, goal alignment, and communication strategies to effectively balance high-pressure assignments. Outline how you keep stakeholders updated on changing timelines.

10. Tell me about your mentoring style – how do you develop junior staff while maintaining productivity?

GALE Partners looks for leaders who can nurture talent and foster growth while delivering results. This question evaluates your management philosophy.

Discuss how you establish growth goals, provide constructive feedback, and create plans to elevate skills. Share tactics for encouraging questions and engagement. Explain how you promote development through training programs or stretch assignments. Outline how you track progress using performance data and reviews. Share examples of how your mentees have advanced their careers through your guidance.

11. Walk me through how you have realigned business plans based on market insights and trends.

This examines your ability to interpret market signals and adapt strategies accordingly. GALE Partners values leaders who can steer the business through data-driven foresight.

Describe how you analyze trends and segment data to derive actionable insights. Use a specific example of how your market analysis informed a pivot in strategy, messaging, product development, or channel mix. Quantify the impact your recommendations had on critical performance indicators for the business.

12. Tell me about a successful integrated marketing campaign you executed and measured.

This question evaluates your experience driving multifaceted campaigns and leveraging data to optimize outcomes. Analytics expertise is highly valued at data-driven firms like GALE.

Summarize the campaign goals, target segments, channels, and messaging strategy you orchestrated. Share key metrics you tracked across channels to monitor engagement, conversions, and ROI. Discuss how you adjusted the campaign in real-time based on those insights. Convey quantifiable results and impact aligned to original objectives.

13. How would you identify and leverage new social media opportunities to amplify our brand?

In the digital marketing space, capitalizing on new channels is key to staying top of mind. This assesses your ability to spot trends and develop innovative engagement strategies tailored to emerging media.

Discuss how you would monitor industry developments and leverage analytics tools to identify high-potential channels for your brand. Share creative ideas for developing content and initiatives that resonate on new platforms, aligning with brand vision and audience preferences. Explain how you would measure impact and translate engagement into brand awareness and business growth.

14. Tell me about a time you took on a leadership role in a challenging cross-functional project.

GALE Partners values leaders who can drive results through influence across organizational boundaries. This probes your ability to lead without formal authority.

Describe a project where you had to rally and align players from different teams/departments. Discuss how you developed buy-in, motivated participation, and facilitated smooth collaboration. Share how you resolved conflicts or resistance that arose. Outline your specific contributions and the end outcomes of the project.

15. Have you ever turned around a distressed client account? What key actions did you take?

Your ability to rescue distressed accounts speaks volumes in client services roles. This question reveals your problem-solving skills under pressure.

Briefly summarize the scenario – declining retention, missed deliver

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The team at GALE

• The founders of GALE is Miles Nadal .
• Mark Penn and Miles Nadal are the most important people at GALE.

GALE is ranked #66 on the Best Media Companies to Work For in California list. Zippias Best Places to Work lists provide unbiased, data-based evaluations of companies. Rankings are based on government and proprietary data on salaries, company financial health, and employee diversity.

Rate GALEs fairness in compensating employees.

• GALE has 420 employees .
• 39% of GALE employees are women , while 61% are men.
• The most common ethnicity at GALE is White (64%).
• 16% of GALE employees are Hispanic or Latino.
• 10% of GALE employees are Black or African American.
• The average employee at GALE makes $58,615 per year.
• People who work at GALE are most likely to be Republicans.
• Employees at GALE stay with the company for 4. 0 years on average.

Do you work at GALE ?

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How to Answer Behavioral Interview Questions Sample Answers

What is the interview process for Gale Partners?

What questions are asked at the first round of the FT partners interview?

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Case Study: Integrated Profit and Loss Accounting at Natura &Co

Presentation by Alessandra Segatelli, Controllership Director - LatAm, Natura &Co

• This case study article highlights Natura &Co’s Integrated Profit and Loss (IP&L) approach and methodology, as well as the role of the finance team in its development.
• Natura is a leader in impact accounting, using its IP&L and underlying methodology to quantify the impacts and net value of its corporate performance on environmental, social, and human capital.
• The IP&L captures the impacts of Natura’s business activities across its full value chain, ranging from Natura’s supplier chain and extractive communities in the Amazon region, through direct Natura operations, its beauty consultants, to product use and product end of life.
• Natura implemented the IP&L model as a strategic management and decision-making tool, as the results can be compared directly with the financial results, which helps in risk management and reporting to investors, and contribute to the operationalization of stakeholder capitalism.
• The controller and finance team are involved in the development of the IP&L methodology, including data collection, measurement and valuation. They support the measurement of key impacts linked to business activities and quantify these to enable decisions that achieve a balance between positive impacts and profitability.
• In terms of policy, to help develop the connectivity with financial statements, financial reporting standards could usefully develop common methodologies and accounting treatments for some ESG areas including carbon credits. International standards for measuring and valuing impacts would also help drive a more common approach to impact accounting that would lead to integrated reports being more quantitative.

Natura &Co Key Facts

• Founded in 1969, Natura is a Brazilian global cosmetics company headquartered in São Paulo. Since 2020, Natura is part of Natura &Co group, comprised of four purpose-led beauty companies: Avon, Natura, The Body Shop and Aesop.
• A pioneer within the beauty sector among B Corps, Natura obtained its certification in 2014, becoming the first publicly traded company in the world to earn it. In 2021, Natura &Co became the world’s largest certified B-Corp.
• Natura &Co’s consolidated net revenue is R$ 40.16 billion and net income R$1 billion, and has 35,000+ employees,7.7 million consultants and representatives, and 3,700 stores and franchises.
• Natura &Co issued a US$ 1 billion sustainability-linked bond related to selected sustainability targets, which is the largest single issuance of this type by a Brazilian company.
• Sustainability is an integral part of Natura’s purpose, strategy and business model across natural, social and human capital dimensions.
• Natura was highly commended at the 2022  Finance for the Future Awards  in the category for embedding an integrated approach and recognizing the finance team’s critical role in delivering this integration.

 Natura’s purpose:  To nurture beauty and relationships for a better way of living and doing business

Natura Integrated Profit & Loss Accounting

Natura &Co believes that the value and longevity of a company are directly linked with its capacity to contribute to the evolution of society and its sustainable development. To collaborate with the wide-reaching change our world needs, it is fundamental for us to measure our legacy or, in other words, the impact we generate through our operation.

Natura’s leadership in impact accounting has culminated in its IP&L and underlying methodology to account in monetary values for the impacts of its corporate performance on environmental, social and human capital.

The IP&L methodology connects business activities to impacts and allows the attribution of value to impacts be they positive or negative. This provides quantitative information that permits better strategic decision-making aimed at leveraging positive impacts and mitigating negative ones, for example, in improving supply chain processes and vendor selection, and operations. It also allows decisions to be made to balance profitability at the same time as achieving sustainability goals. 

Natura has a cross-functional committee responsible for the development and strategy of the IP&L methodology, which includes the controllership and technical accounting team, as well as members of the financial planning and analysis (FP&A) team and Sustainability Center of Expertise.

The development and publication of the IP&L started in 2010 with Natura’s efforts to understand its supplier network and key raw materials such as palm oil. Between 2014-16, Natura developed an Environmental Profit & Loss and expanded it to social impacts in 2017-19, particularly to measure and enhance the contribution of its approximately 2 million beauty consultants in Brazil, Argentina, Chile, Colombia, Mexico, Peru and Malaysia to their communities. A full IP&L model was issued in 2021 and is now included in internal decision-making and public disclosure with external assurance. The IP&L has become  Natura’s Integrated Report .

The IP&L methodology relies mostly on the Natural Capital Protocol and the Human and Social Capital Protocol (Capitals Coalition, 2016, 2019). The methodology involves

• Collecting data
• Identifying and measuring impacts
• Taking decisions to leverage positive impacts and mitigate negative impacts.

IP&L  Methodology

The Natura &Co IP&L methodology is available at  Natura Integrated Profit & Loss Accounting 2021, Technical Executive Summary and Insights . A summary is provided here.

•  Natura’s sustainability strategy and IP&L address three material sustainability topics covering natural, human and social capital: 
• Living Amazon Forest : Movement to transform the Pan-Amazon region into a global example of a new society that integrates people, the forest and cities in a sustainable manner, creating more shared value;
• More Beauty, Less Waste : Offers the most, using the least, and reducing excesses. Natura has used recycled materials and materials of renewable origin, as well as refills, for over 30 years and strives to do more;
• Every Person Matters : Each person in Natura’s relationship network matters a great deal to the company. With each one, the focus is on making a social pact that decreases inequality and intolerance and promotes social inclusion with effective transformational actions. Each person is a world. And the whole world matters.
•  Figure 1 captures the business impacts from activities across Natura’s full value chain, from its suppliers and extractive communities in the Amazon region to its direct operations (manufacturing and offices), the Natura sales consultants, the products used by customers, and the product end-of-life.
•  Measuring impacts involves identifying key activities in the value chain, relevant impact drivers across human, social and natural capital, and assessment paths to understand direct and indirect economic effects. This means that impacts can be monetized, allowing, for example, the value of nature or wellbeing to be expressed in monetary terms. 
• Methodologies and calculations to convert resources into economic value are based on two main possible pathways: Direct effects on health and quality of life or economic effects that are calculated through utilitarian models, which reflect a change in the quality of life of an individual or collective. Some examples of valuation factors considered for measuring IP&L outcomes are: 
• Social cost of carbon, which reflects the current and future economic damage per ton of carbon ($97/tCO 2  based on PwC’s Total Impact Measurement and Management Framework); 
• The value of ecosystem services and wellbeing of Amazon supplier communities for the sustainable use of the forest, and other sources for plastic ($760/ha of forest based on substitution or mitigation costs); and
•  Factors that translate income or taxes into changes in well-being and quality of life, such as HUI (Health Utility of Income) which determines the utility of money in different socio-economic contexts, or HUT (Health Utility of Taxes), which values ​​quality change of life and well-being of a population through the collection of taxes.

• Ultimately, the IP&L methodology provides an overview of Natura’s net value delivered across human, social and natural capital. In 2021, the IP&L showed a net positive societal value created by Natura of approximately R$18 billion (around US$3.5 billion), mostly driven by social and human capital. For each $1 in revenue, Natura generated $1.5 in positive social and natural impact. The impact of Natura's natural capital is still negative (as it is for most companies), mainly due to the final stages of disposal of products by the consumer and subsequent recycling. It is important to see this indicator reflected in the IP&L precisely to direct and prioritize actions.
• To address these issues, Natura follows the targets and 40 sustainability key performance indicators (KPIs) set out in its Commitments in its 2030 Vision - Commitment to Life - which covers topics such as net zero, regenerative initiatives, circularity and sustainable materials. Natura has been reducing its natural capital impact for many years. Through its sustainability strategy, it will continue to reduce its negative impact and increase the positive. The KPIs enable performance management and track the company’s sustainability strategy in conjunction with strategic planning.

The Role of the Finance Team

Natura’s Finance Team plays an important role in the measurement of impacts, supporting necessary data collection, monitoring the progress of socio-environmental issues and combating climate change through key indicators, supporting the establishment of tangible and relevant goals, and encouraging the creation of action plans to leverage all the company's results, whether economic, social, human or environmental. 

Now, the integrated assessment that IP&L generates guarantees the implementation of ESG policies embedded in the day-to-day strategy of the group's companies, and ensures decisions always combine both the search for profitability and return to all stakeholders.

In terms of the external reporting and assurance process,

• Currently, IP&L is disclosed in the Annual Report, separate from Natura’s financial statements. However, the IP&L was structured in the same format as the traditional financial statement, making it possible to identify which activity generates which level of impact and to link the financial statement line to a range of non-financial metrics, such as carbon emissions and offsetting, and supply chain indicators.
• All sustainability-related KPIs are externally assured since 2001 and by PwC in 2022, and some are outputs then used in the IP&L measurement.

Through its controllership function, Natura also engages and influences external groups that are establishing standards, frameworks, and guidance including the IFRS Foundation and ISSB, the Capitals Coalition, Impact Management Project, Value Balancing Alliance, and World Business Council for Sustainable Development. To help develop the connectivity with financial statements, financial reporting standards could usefully develop common methodologies and accounting treatments for some ESG areas including carbon credits. International standards for measuring and valuing impacts would also help drive a more common approach to impact accounting that would lead to integrated reports being more quantitative.

This was a presentation to the IFAC Professional Accountants in Business Advisory Group during their September 2022 meeting. Read more insights from IFAC’s Professional Accountants in Business Advisory Group’s report:  Professional Accountants as Finance and Business Leaders.

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Accenture Interview Experience For A Business Development Manager

Here I want to share that a few months ago I had the opportunity to interview for the position of Business Development Manager at Accenture, and I’d like to share my detailed experience with you. The process was quite structured and thorough, ensuring that candidates were assessed comprehensively.

Overview of the Interview Rounds

In that interview process, there were four main rounds:

• Initial HR Screening
• Technical Interview
• Case Study Presentation
• Final Interview with Senior Management

Round 1: Initial HR Screening

The first round was a phone interview with an HR representative. It was primarily focused on my background, experience, and fit for the role. The questions were quite straightforward like:

• Can you walk me through your resume?
• Why are you interested in Accenture and this role?
• What are your key strengths and weaknesses?
• Can you describe a challenging situation you faced in your previous role and how you handled it?

The HR representative was friendly and made me feel at ease. This round lasted about 30 minutes.

Round 2: Technical Interview

The second round was a technical interview with a senior consultant. This was conducted via video call and lasted about an hour. The interviewer delved deeper into my professional experience and skills. Some of the questions included:

• Can you describe a successful business development strategy you implemented in the past?
• How do you prioritize leads and opportunities?
• What CRM tools are you proficient in?
• How do you handle objections from potential clients?

I was also asked to discuss a recent market trend that could impact consulting services and how I would leverage it for business growth.

Round 3: Case Study Presentation

The third round was quite challenging. I was given a case study to prepare and present within two days. The case involved developing a business development strategy for a fictional client in the technology sector. During the presentation, the panel asked probing questions to test my analytical and strategic thinking skills. Some of the questions were:

• Why did you choose this particular strategy?
• How would you measure the success of your proposed plan?
• What potential risks do you foresee, and how would you mitigate them?
• Can you provide a detailed financial projection for the first year?

This round tested not only my business acumen but also my presentation skills and ability to think on my feet.

Round 4: Final Interview with Senior Management

The final round was an interview with senior management, including a partner and a director. This was the most intense part of the process and lasted about 90 minutes. The focus was on leadership skills, cultural fit, and long-term vision. Questions included:

• How do you align your personal goals with the company’s objectives?
• Can you give an example of a time you led a team through a significant challenge?
• How do you stay motivated, and how do you motivate others?
• Where do you see yourself in five years?

They were also interested in understanding how I would contribute to the firm’s growth and innovation. The interviewers were very experienced and asked thought-provoking questions that required deep reflection.

Overall Experience:

Overall, the interview experience with Accenture was good. The structured process ensured that each candidate’s skills and fit for the role were thoroughly assessed. I appreciated the opportunity to showcase my abilities and to engage with professionals at different levels within the company.

Each round provided a different perspective on the role and allowed me to demonstrate my competencies in various ways. The case study, in particular, was a great way to illustrate my strategic thinking and problem-solving skills.

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• Data Science Interview Questions

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Introduction:

Data science is an interdisciplinary field that mines raw data, analyses it, and comes up with patterns that are used to extract valuable insights from it. Statistics, computer science, machine learning, deep learning, data analysis, data visualization, and various other technologies form the core foundation of data science.

Over the years, data science has gained widespread importance due to the importance of data. Data is considered the new oil of the future which when analyzed and harnessed properly can prove to be very beneficial to the stakeholders. Not just this, a data scientist gets exposure to work in diverse domains, solving real-life practical problems all by making use of trendy technologies. The most common real-time application is fast delivery of food in apps such as Uber Eats by aiding the delivery person to show the fastest possible route to reach the destination from the restaurant. 

Data Science is also used in item recommendation systems in e-commerce sites like Amazon, Flipkart, etc which recommend the user what item they can buy based on their search history. Not just recommendation systems, Data Science is becoming increasingly popular in fraud detection applications to detect any fraud involved in credit-based financial applications. A successful data scientist can interpret data, perform innovation and bring out creativity while solving problems that help drive business and strategic goals. This makes it the most lucrative job of the 21st century.

In this article, we will explore what are the most commonly asked Data Science Technical Interview Questions which will help both aspiring and experienced data scientists.

Data Science Interview Questions for Freshers

Data science interview questions for experienced, frequently asked questions, data science mcq, 1. what is data science.

An interdisciplinary field that constitutes various scientific processes, algorithms, tools, and machine learning techniques working to help find common patterns and gather sensible insights from the given raw input data using statistical and mathematical analysis is called Data Science.

The following figure represents the life cycle of data science.

• It starts with gathering the business requirements and relevant data.
• Once the data is acquired, it is maintained by performing data cleaning, data warehousing, data staging, and data architecture.
• Data processing does the task of exploring the data, mining it, and analyzing it which can be finally used to generate the summary of the insights extracted from the data.
• Once the exploratory steps are completed, the cleansed data is subjected to various algorithms like predictive analysis, regression, text mining, recognition patterns, etc depending on the requirements.
• In the final stage, the results are communicated to the business in a visually appealing manner. This is where the skill of data visualization, reporting, and different business intelligence tools come into the picture. Learn More .

2. What is the difference between data analytics and data science?

• Data science involves the task of transforming data by using various technical analysis methods to extract meaningful insights using which a data analyst can apply to their business scenarios.
• Data analytics deals with checking the existing hypothesis and information and answers questions for a better and effective business-related decision-making process.
• Data Science drives innovation by answering questions that build connections and answers for futuristic problems. Data analytics focuses on getting present meaning from existing historical context whereas data science focuses on predictive modeling.
• Data Science can be considered as a broad subject that makes use of various mathematical and scientific tools and algorithms for solving complex problems whereas data analytics can be considered as a specific field dealing with specific concentrated problems using fewer tools of statistics and visualization.

The following Venn diagram depicts the difference between data science and data analytics clearly:

3. What are some of the techniques used for sampling? What is the main advantage of sampling?

Data analysis can not be done on a whole volume of data at a time especially when it involves larger datasets. It becomes crucial to take some data samples that can be used for representing the whole population and then perform analysis on it. While doing this, it is very much necessary to carefully take sample data out of the huge data that truly represents the entire dataset.

There are majorly two categories of sampling techniques based on the usage of statistics, they are:

• Probability Sampling techniques: Clustered sampling, Simple random sampling, Stratified sampling.
• Non-Probability Sampling techniques: Quota sampling, Convenience sampling, snowball sampling, etc.

4. List down the conditions for Overfitting and Underfitting.

Overfitting: The model performs well only for the sample training data. If any new data is given as input to the model, it fails to provide any result. These conditions occur due to low bias and high variance in the model. Decision trees are more prone to overfitting.

Underfitting: Here, the model is so simple that it is not able to identify the correct relationship in the data, and hence it does not perform well even on the test data. This can happen due to high bias and low variance. Linear regression is more prone to Underfitting.

5. Differentiate between the long and wide format data.

The following image depicts the representation of wide format and long format data:

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6. what are eigenvectors and eigenvalues.

Eigenvectors are column vectors or unit vectors whose length/magnitude is equal to 1. They are also called right vectors. Eigenvalues are coefficients that are applied on eigenvectors which give these vectors different values for length or magnitude.

A matrix can be decomposed into Eigenvectors and Eigenvalues and this process is called Eigen decomposition. These are then eventually used in machine learning methods like PCA (Principal Component Analysis) for gathering valuable insights from the given matrix.

7. What does it mean when the p-values are high and low?

A p-value is the measure of the probability of having results equal to or more than the results achieved under a specific hypothesis assuming that the null hypothesis is correct. This represents the probability that the observed difference occurred randomly by chance.

• Low p-value which means values ≤ 0.05 means that the null hypothesis can be rejected and the data is unlikely with true null.
• High p-value, i.e values ≥ 0.05 indicates the strength in favor of the null hypothesis. It means that the data is like with true null.
• p-value = 0.05 means that the hypothesis can go either way.

8. When is resampling done?

Resampling is a methodology used to sample data for improving accuracy and quantify the uncertainty of population parameters. It is done to ensure the model is good enough by training the model on different patterns of a dataset to ensure variations are handled. It is also done in the cases where models need to be validated using random subsets or when substituting labels on data points while performing tests.

9. What do you understand by Imbalanced Data?

Data is said to be highly imbalanced if it is distributed unequally across different categories. These datasets result in an error in model performance and result in inaccuracy.

10. Are there any differences between the expected value and mean value?

There are not many differences between these two, but it is to be noted that these are used in different contexts. The mean value generally refers to the probability distribution whereas the expected value is referred to in the contexts involving random variables.

11. What do you understand by Survivorship Bias?

This bias refers to the logical error while focusing on aspects that survived some process and overlooking those that did not work due to lack of prominence. This bias can lead to deriving wrong conclusions.

12. Define the terms KPI, lift, model fitting, robustness and DOE.

• KPI: KPI stands for Key Performance Indicator that measures how well the business achieves its objectives.
• Lift: This is a performance measure of the target model measured against a random choice model. Lift indicates how good the model is at prediction versus if there was no model.
• Model fitting: This indicates how well the model under consideration fits given observations.
• Robustness: This represents the system’s capability to handle differences and variances effectively.
• DOE: stands for the design of experiments, which represents the task design aiming to describe and explain information variation under hypothesized conditions to reflect variables.

13. Define confounding variables.

Confounding variables are also known as confounders. These variables are a type of extraneous variables that influence both independent and dependent variables causing spurious association and mathematical relationships between those variables that are associated but are not casually related to each other.

14. Define and explain selection bias?

The selection bias occurs in the case when the researcher has to make a decision on which participant to study. The selection bias is associated with those researches when the participant selection is not random. The selection bias is also called the selection effect. The selection bias is caused by as a result of the method of sample collection.

Four types of selection bias are explained below:

• Sampling Bias: As a result of a population that is not random at all, some members of a population have fewer chances of getting included than others, resulting in a biased sample. This causes a systematic error known as sampling bias.
• Time interval: Trials may be stopped early if we reach any extreme value but if all variables are similar invariance, the variables with the highest variance have a higher chance of achieving the extreme value.
• Data: It is when specific data is selected arbitrarily and the generally agreed criteria are not followed.
• Attrition: Attrition in this context means the loss of the participants. It is the discounting of those subjects that did not complete the trial.

15. Define bias-variance trade-off?

Let us first understand the meaning of bias and variance in detail:

Bias: It is a kind of error in a machine learning model when an ML Algorithm is oversimplified. When a model is trained, at that time it makes simplified assumptions so that it can easily understand the target function. Some algorithms that have low bias are Decision Trees, SVM, etc. On the other hand, logistic and linear regression algorithms are the ones with a high bias.

Variance: Variance is also a kind of error. It is introduced into an ML Model when an ML algorithm is made highly complex. This model also learns noise from the data set that is meant for training. It further performs badly on the test data set. This may lead to over lifting as well as high sensitivity.

When the complexity of a model is increased, a reduction in the error is seen. This is caused by the lower bias in the model. But, this does not happen always till we reach a particular point called the optimal point. After this point, if we keep on increasing the complexity of the model, it will be over lifted and will suffer from the problem of high variance. We can represent this situation with the help of a graph as shown below:

As you can see from the image above, before the optimal point, increasing the complexity of the model reduces the error (bias). However, after the optimal point, we see that the increase in the complexity of the machine learning model increases the variance.

Trade-off Of Bias And Variance: So, as we know that bias and variance, both are errors in machine learning models, it is very essential that any machine learning model has low variance as well as a low bias so that it can achieve good performance.

Let us see some examples. The K-Nearest Neighbor Algorithm is a good example of an algorithm with low bias and high variance. This trade-off can easily be reversed by increasing the k value which in turn results in increasing the number of neighbours. This, in turn, results in increasing the bias and reducing the variance.

Another example can be the algorithm of a support vector machine. This algorithm also has a high variance and obviously, a low bias and we can reverse the trade-off by increasing the value of parameter C. Thus, increasing the C parameter increases the bias and decreases the variance.

So, the trade-off is simple. If we increase the bias, the variance will decrease and vice versa.

16. Define the confusion matrix?

It is a matrix that has 2 rows and 2 columns. It has 4 outputs that a binary classifier provides to it. It is used to derive various measures like specificity, error rate, accuracy, precision, sensitivity, and recall.

The test data set should contain the correct and predicted labels. The labels depend upon the performance. For instance, the predicted labels are the same if the binary classifier performs perfectly. Also, they match the part of observed labels in real-world scenarios. The four outcomes shown above in the confusion matrix mean the following:

• True Positive: This means that the positive prediction is correct.
• False Positive: This means that the positive prediction is incorrect.
• True Negative: This means that the negative prediction is correct.
• False Negative: This means that the negative prediction is incorrect.

The formulas for calculating basic measures that comes from the confusion matrix are:

• Error rate : (FP + FN)/(P + N)
• Accuracy : (TP + TN)/(P + N)
• Sensitivity = TP/P
• Specificity = TN/N
• Precision = TP/(TP + FP)
• F-Score  = (1 + b)(PREC.REC)/(b2 PREC + REC) Here, b is mostly 0.5 or 1 or 2.

In these formulas:

FP = false positive FN = false negative TP = true positive RN = true negative

Sensitivity is the measure of the True Positive Rate. It is also called recall. Specificity is the measure of the true negative rate. Precision is the measure of a positive predicted value. F-score is the harmonic mean of precision and recall.

17. What is logistic regression? State an example where you have recently used logistic regression.

Logistic Regression is also known as the logit model. It is a technique to predict the binary outcome from a linear combination of variables (called the predictor variables). 

For example , let us say that we want to predict the outcome of elections for a particular political leader. So, we want to find out whether this leader is going to win the election or not. So, the result is binary i.e. win (1) or loss (0). However, the input is a combination of linear variables like the money spent on advertising, the past work done by the leader and the party, etc. 

18. What is Linear Regression? What are some of the major drawbacks of the linear model?

Linear regression is a technique in which the score of a variable Y is predicted using the score of a predictor variable X. Y is called the criterion variable. Some of the drawbacks of Linear Regression are as follows:

• The assumption of linearity of errors is a major drawback.
• It cannot be used for binary outcomes. We have Logistic Regression for that.
• Overfitting problems are there that can’t be solved.

19. What is a random forest? Explain it’s working.

Classification is very important in machine learning. It is very important to know to which class does an observation belongs. Hence, we have various classification algorithms in machine learning like logistic regression, support vector machine, decision trees, Naive Bayes classifier, etc. One such classification technique that is near the top of the classification hierarchy is the random forest classifier. 

So, firstly we need to understand a decision tree before we can understand the random forest classifier and its works. So, let us say that we have a string as given below:

So, we have the string with 5 ones and 4 zeroes and we want to classify the characters of this string using their features. These features are colour (red or green in this case) and whether the observation (i.e. character) is underlined or not. Now, let us say that we are only interested in red and underlined observations. So, the decision tree would look something like this:

So, we started with the colour first as we are only interested in the red observations and we separated the red and the green-coloured characters. After that, the “No” branch i.e. the branch that had all the green coloured characters was not expanded further as we want only red-underlined characters. So, we expanded the “Yes” branch and we again got a “Yes” and a “No” branch based on the fact whether the characters were underlined or not. 

So, this is how we draw a typical decision tree. However, the data in real life is not this clean but this was just to give an idea about the working of the decision trees. Let us now move to the random forest.

Random Forest

It consists of a large number of decision trees that operate as an ensemble. Basically, each tree in the forest gives a class prediction and the one with the maximum number of votes becomes the prediction of our model. For instance, in the example shown below, 4 decision trees predict 1, and 2 predict 0. Hence, prediction 1 will be considered.

The underlying principle of a random forest is that several weak learners combine to form a keen learner. The steps to build a random forest are as follows:

• Build several decision trees on the samples of data and record their predictions.
• Each time a split is considered for a tree, choose a random sample of mm predictors as the split candidates out of all the pp predictors. This happens to every tree in the random forest.
• Apply the rule of thumb i.e. at each split m = p√m = p.
• Apply the predictions to the majority rule.

20. In a time interval of 15-minutes, the probability that you may see a shooting star or a bunch of them is 0.2. What is the percentage chance of you seeing at least one star shooting from the sky if you are under it for about an hour?

Let us say that Prob is the probability that we may see a minimum of one shooting star in 15 minutes.

So, Prob = 0.2

Now, the probability that we may not see any shooting star in the time duration of 15 minutes is = 1 - Prob

1-0.2 = 0.8

The probability that we may not see any shooting star for an hour is: 

= (1-Prob)(1-Prob)(1-Prob)*(1-Prob) = 0.8 * 0.8 * 0.8 * 0.8 = (0.8)⁴   ≈ 0.40

So, the probability that we will see one shooting star in the time interval of an hour is = 1-0.4 = 0.6

So, there are approximately 60% chances that we may see a shooting star in the time span of an hour.

21. What is deep learning? What is the difference between deep learning and machine learning?

Deep learning is a paradigm of machine learning. In deep learning,  multiple layers of processing are involved in order to extract high features from the data. The neural networks are designed in such a way that they try to simulate the human brain. 

Deep learning has shown incredible performance in recent years because of the fact that it shows great analogy with the human brain.

The difference between machine learning and deep learning is that deep learning is a paradigm or a part of machine learning that is inspired by the structure and functions of the human brain called the artificial neural networks. Learn More .

22. What is a Gradient and Gradient Descent?

Gradient: Gradient is the measure of a property that how much the output has changed with respect to a little change in the input. In other words, we can say that it is a measure of change in the weights with respect to the change in error. The gradient can be mathematically represented as the slope of a function.

Gradient Descent: Gradient descent is a minimization algorithm that minimizes the Activation function. Well, it can minimize any function given to it but it is usually provided with the activation function only. 

Gradient descent, as the name suggests means descent or a decrease in something. The analogy of gradient descent is often taken as a person climbing down a hill/mountain. The following is the equation describing what gradient descent means:

So, if a person is climbing down the hill, the next position that the climber has to come to is denoted by “b” in this equation. Then, there is a minus sign because it denotes the minimization (as gradient descent is a minimization algorithm). The Gamma is called a waiting factor and the remaining term which is the Gradient term itself shows the direction of the steepest descent. 

This situation can be represented in a graph as follows:

Here, we are somewhere at the “Initial Weights” and we want to reach the Global minimum. So, this minimization algorithm will help us do that.

1. How are the time series problems different from other regression problems?

• Time series data can be thought of as an extension to linear regression which uses terms like autocorrelation, movement of averages for summarizing historical data of y-axis variables for predicting a better future.
• Forecasting and prediction is the main goal of time series problems where accurate predictions can be made but sometimes the underlying reasons might not be known.
• Having Time in the problem does not necessarily mean it becomes a time series problem. There should be a relationship between target and time for a problem to become a time series problem.
• The observations close to one another in time are expected to be similar to the ones far away which provide accountability for seasonality. For instance, today’s weather would be similar to tomorrow’s weather but not similar to weather from 4 months from today. Hence, weather prediction based on past data becomes a time series problem.

2. What are RMSE and MSE in a linear regression model?

RMSE: RMSE stands for Root Mean Square Error. In a linear regression model, RMSE is used to test the performance of the machine learning model. It is used to evaluate the data spread around the line of best fit. So, in simple words, it is used to measure the deviation of the residuals.

RMSE is calculated using the formula:

• Yi is the actual value of the output variable.
• Y(Cap) is the predicted value and,
• N is the number of data points.

MSE: Mean Squared Error is used to find how close is the line to the actual data. So, we make the difference in the distance of the data points from the line and the difference is squared. This is done for all the data points and the submission of the squared difference divided by the total number of data points gives us the Mean Squared Error (MSE).

So, if we are taking the squared difference of N data points and dividing the sum by N, what does it mean? Yes, it represents the average of the squared difference of a data point from the line i.e. the average of the squared difference between the actual and the predicted values. The formula for finding MSE is given below:

• Yi is the actual value of the output variable (the ith data point)
• Y(cap) is the predicted value and,
• N is the total number of data points.

So, RMSE is the square root of MSE .

3. What are Support Vectors in SVM (Support Vector Machine)?

In the above diagram, we can see that the thin lines mark the distance from the classifier to the closest data points (darkened data points). These are called support vectors. So, we can define the support vectors as the data points or vectors that are nearest (closest) to the hyperplane. They affect the position of the hyperplane. Since they support the hyperplane, they are known as support vectors.

4. So, you have done some projects in machine learning and data science and we see you are a bit experienced in the field. Let’s say your laptop’s RAM is only 4GB and you want to train your model on 10GB data set.

What will you do have you experienced such an issue before.

In such types of questions, we first need to ask what ML model we have to train. After that, it depends on whether we have to train a model based on Neural Networks or SVM.

The steps for Neural Networks are given below:

• The Numpy array can be used to load the entire data. It will never store the entire data, rather just create a mapping of the data.
• Now, in order to get some desired data, pass the index into the NumPy Array.
• This data can be used to pass as an input to the neural network maintaining a small batch size.

The steps for SVM are given below:

• For SVM, small data sets can be obtained. This can be done by dividing the big data set.
• The subset of the data set can be obtained as an input if using the partial fit function.
• Repeat the step of using the partial fit method for other subsets as well.

Now, you may describe the situation if you have faced such an issue in your projects or working in machine learning/ data science.

5. Explain Neural Network Fundamentals.

In the human brain, different neurons are present. These neurons combine and perform various tasks. The Neural Network in deep learning tries to imitate human brain neurons. The neural network learns the patterns from the data and uses the knowledge that it gains from various patterns to predict the output for new data, without any human assistance.

A perceptron is the simplest neural network that contains a single neuron that performs 2 functions. The first function is to perform the weighted sum of all the inputs and the second is an activation function.

There are some other neural networks that are more complicated. Such networks consist of the following three layers:

• Input Layer: The neural network has the input layer to receive the input.
• Hidden Layer: There can be multiple hidden layers between the input layer and the output layer. The initially hidden layers are used for detecting the low-level patterns whereas the further layers are responsible for combining output from previous layers to find more patterns.
• Output Layer: This layer outputs the prediction.

An example neural network image is shown below:

6. What is Generative Adversarial Network?

This approach can be understood with the famous example of the wine seller. Let us say that there is a wine seller who has his own shop. This wine seller purchases wine from the dealers who sell him the wine at a low cost so that he can sell the wine at a high cost to the customers. Now, let us say that the dealers whom he is purchasing the wine from, are selling him fake wine. They do this as the fake wine costs way less than the original wine and the fake and the real wine are indistinguishable to a normal consumer (customer in this case). The shop owner has some friends who are wine experts and he sends his wine to them every time before keeping the stock for sale in his shop. So, his friends, the wine experts, give him feedback that the wine is probably fake. Since the wine seller has been purchasing the wine for a long time from the same dealers, he wants to make sure that their feedback is right before he complains to the dealers about it. Now, let us say that the dealers also have got a tip from somewhere that the wine seller is suspicious of them.

So, in this situation, the dealers will try their best to sell the fake wine whereas the wine seller will try his best to identify the fake wine. Let us see this with the help of a diagram shown below:

From the image above, it is clear that a noise vector is entering the generator (dealer) and he generates the fake wine and the discriminator has to distinguish between the fake wine and real wine. This is a Generative Adversarial Network (GAN).

In a GAN, there are 2 main components viz. Generator and Discrminator. So, the generator is a CNN that keeps producing images and the discriminator tries to identify the real images from the fake ones. 

7. What is a computational graph?

A computational graph is also known as a “Dataflow Graph”. Everything in the famous deep learning library TensorFlow is based on the computational graph. The computational graph in Tensorflow has a network of nodes where each node operates. The nodes of this graph represent operations and the edges represent tensors.

8. What are auto-encoders?

Auto-encoders are learning networks. They transform inputs into outputs with minimum possible errors. So, basically, this means that the output that we want should be almost equal to or as close as to input as follows. 

Multiple layers are added between the input and the output layer and the layers that are in between the input and the output layer are smaller than the input layer. It received unlabelled input. This input is encoded to reconstruct the input later.

9. What are Exploding Gradients and Vanishing Gradients?

• Exploding Gradients: Let us say that you are training an RNN. Say, you saw exponentially growing error gradients that accumulate, and as a result of this, very large updates are made to the neural network model weights. These exponentially growing error gradients that update the neural network weights to a great extent are called Exploding Gradients .
• Vanishing Gradients: Let us say again, that you are training an RNN. Say, the slope became too small. This problem of the slope becoming too small is called Vanishing Gradient . It causes a major increase in the training time and causes poor performance and extremely low accuracy.

10. What is the p-value and what does it indicate in the Null Hypothesis?

P-value is a number that ranges from 0 to 1. In a hypothesis test in statistics, the p-value helps in telling us how strong the results are. The claim that is kept for experiment or trial is called Null Hypothesis.

• A low p-value i.e. p-value less than or equal to 0.05 indicates the strength of the results against the Null Hypothesis which in turn means that the Null Hypothesis can be rejected. 
• A high p-value i.e. p-value greater than 0.05 indicates the strength of the results in favour of the Null Hypothesis i.e. for the Null Hypothesis which in turn means that the Null Hypothesis can be accepted.

11. Since you have experience in the deep learning field, can you tell us why TensorFlow is the most preferred library in deep learning?

Tensorflow is a very famous library in deep learning. The reason is pretty simple actually. It provides C++ as well as Python APIs which makes it very easier to work on. Also, TensorFlow has a fast compilation speed as compared to Keras and Torch (other famous deep learning libraries). Apart from that, Tenserflow supports both GPU and CPU computing devices. Hence, it is a major success and a very popular library for deep learning.

12. Suppose there is a dataset having variables with missing values of more than 30%, how will you deal with such a dataset?

Depending on the size of the dataset, we follow the below ways:

• In case the datasets are small, the missing values are substituted with the mean or average of the remaining data. In pandas, this can be done by using mean = df.mean() where df represents the pandas dataframe representing the dataset and mean() calculates the mean of the data. To substitute the missing values with the calculated mean, we can use df.fillna(mean) .
• For larger datasets, the rows with missing values can be removed and the remaining data can be used for data prediction.

13. What is Cross-Validation?

Cross-Validation is a Statistical technique used for improving a model’s performance. Here, the model will be trained and tested with rotation using different samples of the training dataset to ensure that the model performs well for unknown data. The training data will be split into various groups and the model is run and validated against these groups in rotation.

The most commonly used techniques are:

• K- Fold method
• Leave p-out method
• Leave-one-out method
• Holdout method

14. What are the differences between correlation and covariance?

Although these two terms are used for establishing a relationship and dependency between any two random variables, the following are the differences between them:

• Correlation: This technique is used to measure and estimate the quantitative relationship between two variables and is measured in terms of how strong are the variables related.
• Covariance: It represents the extent to which the variables change together in a cycle. This explains the systematic relationship between pair of variables where changes in one affect changes in another variable.

Mathematically, consider 2 random variables, X and Y where the means are represented as  μ X {"detectHand":false}  and  μ Y {"detectHand":false}  respectively and standard deviations are represented by  σ X {"detectHand":false}  and  σ Y {"detectHand":false}  respectively and E represents the expected value operator, then:

• covarianceXY = E[(X- μ X {"detectHand":false} ),(Y- μ Y {"detectHand":false} )]
• correlationXY = E[(X- μ X {"detectHand":false} ),(Y- μ Y {"detectHand":false} )]/( σ X {"detectHand":false} σ Y {"detectHand":false} ) so that

Based on the above formula, we can deduce that the correlation is dimensionless whereas covariance is represented in units that are obtained from the multiplication of units of two variables.

The following image graphically shows the difference between correlation and covariance:

15. How do you approach solving any data analytics based project?

Generally, we follow the below steps:

• The first step is to thoroughly understand the business requirement/problem
• Next, explore the given data and analyze it carefully. If you find any data missing, get the requirements clarified from the business.
• Data cleanup and preparation step is to be performed next which is then used for modelling. Here, the missing values are found and the variables are transformed.
• Run your model against the data, build meaningful visualization and analyze the results to get meaningful insights.
• Release the model implementation, and track the results and performance over a specified period to analyze the usefulness.
• Perform cross-validation of the model.

Check out the list of data analytics projects .

16. How regularly must we update an algorithm in the field of machine learning?

We do not want to update and make changes to an algorithm on a regular basis as an algorithm is a well-defined step procedure to solve any problem and if the steps keep on updating, it cannot be said well defined anymore. Also, this brings in a lot of problems to the systems already implementing the algorithm as it becomes difficult to bring in continuous and regular changes. So, we should update an algorithm only in any of the following cases:

• If you want the model to evolve as data streams through infrastructure, it is fair to make changes to an algorithm and update it accordingly.
• If the underlying data source is changing, it almost becomes necessary to update the algorithm accordingly.
• If there is a case of non-stationarity, we may update the algorithm.
• One of the most important reasons for updating any algorithm is its underperformance and lack of efficiency. So, if an algorithm lacks efficiency or underperforms it should be either replaced by some better algorithm or it must be updated.

17. Why do we need selection bias?

Selection Bias happens in cases where there is no randomization specifically achieved while picking a part of the dataset for analysis. This bias tells that the sample analyzed does not represent the whole population meant to be analyzed.

• For example, in the below image, we can see that the sample that we selected does not entirely represent the whole population that we have. This helps us to question whether we have selected the right data for analysis or not.

18. Why is data cleaning crucial? How do you clean the data?

While running an algorithm on any data, to gather proper insights, it is very much necessary to have correct and clean data that contains only relevant information. Dirty data most often results in poor or incorrect insights and predictions which can have damaging effects.

For example, while launching any big campaign to market a product, if our data analysis tells us to target a product that in reality has no demand and if the campaign is launched, it is bound to fail. This results in a loss of the company’s revenue. This is where the importance of having proper and clean data comes into the picture.

• Data Cleaning of the data coming from different sources helps in data transformation and results in the data where the data scientists can work on.
• Properly cleaned data increases the accuracy of the model and provides very good predictions.
• If the dataset is very large, then it becomes cumbersome to run data on it. The data cleanup step takes a lot of time (around 80% of the time) if the data is huge. It cannot be incorporated with running the model. Hence, cleaning data before running the model, results in increased speed and efficiency of the model.
• Data cleaning helps to identify and fix any structural issues in the data. It also helps in removing any duplicates and helps to maintain the consistency of the data.

The following diagram represents the advantages of data cleaning:

19. What are the available feature selection methods for selecting the right variables for building efficient predictive models?

While using a dataset in data science or machine learning algorithms, it so happens that not all the variables are necessary and useful to build a model. Smarter feature selection methods are required to avoid redundant models to increase the efficiency of our model. Following are the three main methods in feature selection:

• These methods pick up only the intrinsic properties of features that are measured via univariate statistics and not cross-validated performance. They are straightforward and are generally faster and require less computational resources when compared to wrapper methods.
• There are various filter methods such as the Chi-Square test, Fisher’s Score method, Correlation Coefficient, Variance Threshold, Mean Absolute Difference (MAD) method, Dispersion Ratios, etc.

• These methods need some sort of method to search greedily on all possible feature subsets, access their quality by learning and evaluating a classifier with the feature.
• The selection technique is built upon the machine learning algorithm on which the given dataset needs to fit.
• Forward Selection: Here, one feature is tested at a time and new features are added until a good fit is obtained.
• Backward Selection: Here, all the features are tested and the non-fitting ones are eliminated one by one to see while checking which works better.
• Recursive Feature Elimination: The features are recursively checked and evaluated how well they perform.
• These methods are generally computationally intensive and require high-end resources for analysis. But these methods usually lead to better predictive models having higher accuracy than filter methods.

• Embedded methods constitute the advantages of both filter and wrapper methods by including feature interactions while maintaining reasonable computational costs.
• These methods are iterative as they take each model iteration and carefully extract features contributing to most of the training in that iteration.
• Examples of embedded methods: LASSO Regularization (L1), Random Forest Importance.

20. During analysis, how do you treat the missing values?

To identify the extent of missing values, we first have to identify the variables with the missing values. Let us say a pattern is identified. The analyst should now concentrate on them as it could lead to interesting and meaningful insights. However, if there are no patterns identified, we can substitute the missing values with the median or mean values or we can simply ignore the missing values. 

If the variable is categorical, the common strategies for handling missing values include:

• Assigning a New Category: You can assign a new category, such as "Unknown" or "Other," to represent the missing values.
• Mode imputation: You can replace missing values with the mode, which represents the most frequent category in the variable.
• Using a Separate Category: If the missing values carry significant information, you can create a separate category to indicate missing values.

It's important to select an appropriate strategy based on the nature of the data and the potential impact on subsequent analysis or modelling.

If 80% of the values are missing for a particular variable, then we would drop the variable instead of treating the missing values.

21. Will treating categorical variables as continuous variables result in a better predictive model?

Yes! A categorical variable is a variable that can be assigned to two or more categories with no definite category ordering. Ordinal variables are similar to categorical variables with proper and clear ordering defines. So, if the variable is ordinal, then treating the categorical value as a continuous variable will result in better predictive models.

22. How will you treat missing values during data analysis?

The impact of missing values can be known after identifying what type of variables have missing values.

• If the data analyst finds any pattern in these missing values, then there are chances of finding meaningful insights.
• In case of patterns are not found, then these missing values can either be ignored or can be replaced with default values such as mean, minimum, maximum, or median values.
• Assigning a new category: You can assign a new category, such as "Unknown" or "Other," to represent the missing values.
• Using a separate category : If the missing values carry significant information, you can create a separate category to indicate the missing values. It's important to select an appropriate strategy based on the nature of the data and the potential impact on subsequent analysis or modelling.
• If 80% of values are missing, then it depends on the analyst to either replace them with default values or drop the variables.

23. What does the ROC Curve represent and how to create it?

ROC (Receiver Operating Characteristic) curve is a graphical representation of the contrast between false-positive rates and true positive rates at different thresholds. The curve is used as a proxy for a trade-off between sensitivity and specificity.

The ROC curve is created by plotting values of true positive rates (TPR or sensitivity) against false-positive rates (FPR or (1-specificity)) TPR represents the proportion of observations correctly predicted as positive out of overall positive observations. The FPR represents the proportion of observations incorrectly predicted out of overall negative observations. Consider the example of medical testing, the TPR represents the rate at which people are correctly tested positive for a particular disease.

24. What are the differences between univariate, bivariate and multivariate analysis?

Statistical analyses are classified based on the number of variables processed at a given time.

25. What is the difference between the Test set and validation set?

The test set is used to test or evaluate the performance of the trained model. It evaluates the predictive power of the model. The validation set is part of the training set that is used to select parameters for avoiding model overfitting.

26. What do you understand by a kernel trick?

Kernel functions are generalized dot product functions used for the computing dot product of vectors xx and yy in high dimensional feature space. Kernal trick method is used for solving a non-linear problem by using a linear classifier by transforming linearly inseparable data into separable ones in higher dimensions.

27. Differentiate between box plot and histogram.

Box plots and histograms are both visualizations used for showing data distributions for efficient communication of information. Histograms are the bar chart representation of information that represents the frequency of numerical variable values that are useful in estimating probability distribution, variations and outliers. Boxplots are used for communicating different aspects of data distribution where the shape of the distribution is not seen but still the insights can be gathered. These are useful for comparing multiple charts at the same time as they take less space when compared to histograms.

28. How will you balance/correct imbalanced data?

There are different techniques to correct/balance imbalanced data. It can be done by increasing the sample numbers for minority classes. The number of samples can be decreased for those classes with extremely high data points. Following are some approaches followed to balance data:

• Specificity/Precision: Indicates the number of selected instances that are relevant.
• Sensitivity: Indicates the number of relevant instances that are selected.
• F1 score: It represents the harmonic mean of precision and sensitivity.
• MCC (Matthews correlation coefficient): It represents the correlation coefficient between observed and predicted binary classifications.
• AUC (Area Under the Curve): This represents a relation between the true positive rates and false-positive rates.

For example, consider the below graph that illustrates training data:

Here, if we measure the accuracy of the model in terms of getting "0"s, then the accuracy of the model would be very high -> 99.9%, but the model does not guarantee any valuable information. In such cases, we can apply different evaluation metrics as stated above.

• Under-sampling This balances the data by reducing the size of the abundant class and is used when the data quantity is sufficient. By performing this, a new dataset that is balanced can be retrieved and this can be used for further modeling.
• Over-sampling This is used when data quantity is not sufficient. This method balances the dataset by trying to increase the samples size. Instead of getting rid of extra samples, new samples are generated and introduced by employing the methods of repetition, bootstrapping, etc.
• Perform K-fold cross-validation correctly: Cross-Validation needs to be applied properly while using over-sampling. The cross-validation should be done before over-sampling because if it is done later, then it would be like overfitting the model to get a specific result. To avoid this, resampling of data is done repeatedly with different ratios. 

29. What is better - random forest or multiple decision trees?

Random forest is better than multiple decision trees as random forests are much more robust, accurate, and lesser prone to overfitting as it is an ensemble method that ensures multiple weak decision trees learn strongly.

30. Consider a case where you know the probability of finding at least one shooting star in a 15-minute interval is 30%. Evaluate the probability of finding at least one shooting star in a one-hour duration?

So the probability is 0.8628 = 86.28%

31. Toss the selected coin 10 times from a jar of 1000 coins. Out of 1000 coins, 999 coins are fair and 1 coin is double-headed, assume that you see 10 heads. Estimate the probability of getting a head in the next coin toss.

We know that there are two types of coins - fair and double-headed. Hence, there are two possible ways of choosing a coin. The first is to choose a fair coin and the second is to choose a coin having 2 heads.

P(selecting fair coin) = 999/1000 = 0.999 P(selecting double headed coin) = 1/1000 = 0.001

Using Bayes rule,

So, the answer is 0.7531 or 75.3%.

32. What are some examples when false positive has proven important than false negative?

Before citing instances, let us understand what are false positives and false negatives.

• False Positives are those cases that were wrongly identified as an event even if they were not. They are called Type I errors.
• False Negatives are those cases that were wrongly identified as non-events despite being an event. They are called Type II errors.

Some examples where false positives were important than false negatives are:

• In the medical field: Consider that a lab report has predicted cancer to a patient even if he did not have cancer. This is an example of a false positive error. It is dangerous to start chemotherapy for that patient as he doesn’t have cancer as starting chemotherapy would lead to damage of healthy cells and might even actually lead to cancer.
• In the e-commerce field: Suppose a company decides to start a campaign where they give $100 gift vouchers for purchasing $10000 worth of items without any minimum purchase conditions. They assume it would result in at least 20% profit for items sold above $10000. What if the vouchers are given to the customers who haven’t purchased anything but have been mistakenly marked as those who purchased $10000 worth of products. This is the case of false-positive error.

33. Give one example where both false positives and false negatives are important equally?

In Banking fields: Lending loans are the main sources of income to the banks. But if the repayment rate isn’t good, then there is a risk of huge losses instead of any profits. So giving out loans to customers is a gamble as banks can’t risk losing good customers but at the same time, they can’t afford to acquire bad customers. This case is a classic example of equal importance in false positive and false negative scenarios.

34. Is it good to do dimensionality reduction before fitting a Support Vector Model?

If the features number is greater than observations then doing dimensionality reduction improves the SVM (Support Vector Model).

35. What are various assumptions used in linear regression? What would happen if they are violated?

Linear regression is done under the following assumptions:

• The sample data used for modeling represents the entire population.
• There exists a linear relationship between the X-axis variable and the mean of the Y variable.
• The residual variance is the same for any X values. This is called homoscedasticity
• The observations are independent of one another.
• Y is distributed normally for any value of X.

Extreme violations of the above assumptions lead to redundant results. Smaller violations of these result in greater variance or bias of the estimates.

36. How is feature selection performed using the regularization method?

The method of regularization entails the addition of penalties to different parameters in the machine learning model for reducing the freedom of the model to avoid the issue of overfitting. There are various regularization methods available such as linear model regularization, Lasso/L1 regularization, etc. The linear model regularization applies penalty over coefficients that multiplies the predictors. The Lasso/L1 regularization has the feature of shrinking some coefficients to zero, thereby making it eligible to be removed from the model.

37. How do you identify if a coin is biased?

To identify this, we perform a hypothesis test as below: According to the null hypothesis, the coin is unbiased if the probability of head flipping is 50%. According to the alternative hypothesis, the coin is biased and the probability is not equal to 500. Perform the below steps:

• Flip coin 500 times
• Calculate p-value.
• p-value > alpha: Then null hypothesis holds good and the coin is unbiased.
• p-value < alpha: Then the null hypothesis is rejected and the coin is biased.

38. What is the importance of dimensionality reduction?

The process of dimensionality reduction constitutes reducing the number of features in a dataset to avoid overfitting and reduce the variance. There are mostly 4 advantages of this process:

• This reduces the storage space and time for model execution.
• Removes the issue of multi-collinearity thereby improving the parameter interpretation of the ML model.
• Makes it easier for visualizing data when the dimensions are reduced.
• Avoids the curse of increased dimensionality.

39. How is the grid search parameter different from the random search tuning strategy?

Tuning strategies are used to find the right set of hyperparameters. Hyperparameters are those properties that are fixed and model-specific before the model is tested or trained on the dataset. Both the grid search and random search tuning strategies are optimization techniques to find efficient hyperparameters.

• Here, every combination of a preset list of hyperparameters is tried out and evaluated.
• The search pattern is similar to searching in a grid where the values are in a matrix and a search is performed. Each parameter set is tried out and their accuracy is tracked. after every combination is tried out, the model with the highest accuracy is chosen as the best one.
• The main drawback here is that, if the number of hyperparameters is increased, the technique suffers. The number of evaluations can increase exponentially with each increase in the hyperparameter. This is called the problem of dimensionality in a grid search.

• In this technique, random combinations of hyperparameters set are tried and evaluated for finding the best solution. For optimizing the search, the function is tested at random configurations in parameter space as shown in the image below.
• In this method, there are increased chances of finding optimal parameters because the pattern followed is random. There are chances that the model is trained on optimized parameters without the need for aliasing.
• This search works the best when there is a lower number of dimensions as it takes less time to find the right set.

Conclusion:

Data Science is a very vast field and comprises many topics like Data Mining, Data Analysis, Data Visualization, Machine Learning, Deep Learning, and most importantly it is laid on the foundation of mathematical concepts like Linear Algebra and Statistical analysis. Since there are a lot of pre-requisites for becoming a good professional Data Scientist, the perks and benefits are very big. Data Scientist has become the most sought job role these days. 

Looking for a comprehensive course on Data Science: Check out Scaler’s Data Science Course .

Useful Resources:

• Best Data Science Courses
• Python Data Science Interview Questions
• Google Data Scientist Salary
• Spotify Data Scientist Salary
• Data Scientist Salary
• Data Science Resume
• Data Analyst: Career Guide
• Tableau Interview
• Additional Technical Interview Questions

1. How do I prepare for a data science interview?

Some of the preparation tips for data science interviews are as follows:

• Resume Building: Firstly, prepare your resume well. It is preferable if the resume is only a 1-page resume, especially for a fresher. You should give great thought to the format of the resume as it matters a lot. The data science interviews can be based more on the topics like linear and logistic regression, SVM, root cause analysis, random forest, etc. So, prepare well for the data science-specific questions like those discussed in this article, make sure your resume has a mention of such important topics and you have a good knowledge of them. Also, please make sure that your resume contains some Data Science-based Projects as well. It is always better to have a group project or internship experience in the field that you are interested to go for. However, personal projects will also have a good impact on the resume. So, your resume should contain at least 2-3 data science-based projects that show your skill and knowledge level in data science. Please do not write any such skill in your resume that you do not possess. If you are just familiar with some technology and have not studied it at an advanced level, you can mention a beginner tag for those skills.
• Prepare Well: Apart from the specific questions on data science, questions on Core subjects like Database Management systems (DBMS), Operating Systems (OS), Computer Networks(CN), and Object-Oriented Programming (OOPS) can be asked from the freshers especially. So, prepare well for that as well.
• Data structures and Algorithms are the basic building blocks of programming. So, you should be well versed with that as well.
• Research the Company: This is the tip that most people miss and it is very important. If you are going for an interview with any company, read about the company before and especially in the case of data science, learn which libraries the company uses, what kind of models are they building, and so on. This gives you an edge over most other people.

2. Are data science interviews hard?

An honest reply will be “YES”. This is because of the fact that this field is newly emerging and will keep on emerging forever. In almost every interview, you have to answer many tough and challenging questions with full confidence and your concepts should be strong to satisfy the interviewer. However, with great practice, anything can be achieved. So, follow the tips discussed above and keep practising and learning. You will definitely succeed.

3. What are the top 3 technical skills of a data scientist?

The top 3 skills of a data scientist are:

• Mathematics: Data science requires a lot of mathematics and a good data scientist is strong in it. It is not possible to become a good data scientist if you are weak in mathematics.
• Machine Learning and Deep Learning : A data scientist should be very skilled in Artificial Intelligence technologies like deep learning and machine learning. Some good projects and a lot of hands-on practice will help in achieving excellence in that field.
• Programming: This is an obvious yet the most important skill. If a person is good at programming it does mean that he/she can solve complex problems as that is just a problem-solving skill. Programming is the ability to write clean and industry-understandable code. This is the skill that most freshers slack because of the lack of exposure to industry-level code. This also improves with practice and experience. 

4. Is data science a good career?

Yes, data science is one of the most futuristic and great career fields. Today and tomorrow or even years later, this field is just going to expand and never end. The reason is simple. Data can be compared to gold today as it is the key to selling everything in the world. Data scientists know how to play with this data to generate some tremendous outputs that are not even imaginable today making it a great career.

5. Are coding questions asked in data science interviews?

Yes, coding questions are asked in data science interviews. One more important thing to note here is that the data scientists are very good problem solvers as they are indulged in a lot of strict mathematics-based activities. Hence, the interviewer expects the data science interview candidates to know data structures and algorithms and at least come up with the solutions to most of the problems.

6. Is python and SQL enough for data science?

Yes. Python and SQL are sufficient for the data science roles. However, knowing the R programming Language can have also have a better impact. If you know these 3 languages, you have got the edge over most of the competitors. However, Python and SQL are enough for data science interviews.

7. What are Data Science tools?

There are various data science tools available in the market nowadays. Various tools can be of great importance. Tensorflow is one of the most famous data science tools. Some of the other famous tools are BigML, SAS (Statistical Analysis System), Knime, Scikit, Pytorch, etc.

Which among the below is NOT a necessary condition for weakly stationary time series data?

Overfitting more likely occurs when there is a huge data amount to train. True or False?

Given the information that the demand is 100 in October 2020, 150 in November 2020, 350 during December 2020 and 400 during January 2021. Calculate a 3-month simple moving average for February 2021.

Which of the below method depicts hierarchical data in nested format?

Which among the following defines the analysis of data objects not complying with general data behaviour?

What does a linear equation having 3 variables represent?

What would be the formula representation of this problem in terms of x and y variables: “The price of 2 pens and 1 pencil as 10 units”?

Which among the below is true regarding hypothesis testing?

What are the model parameters that are used to build ML models using iterative methods under model-based learning methods?

What skills are necessary for a Data Scientist?

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