Financial Analysis interview preparation

Questions

100

Traced to a firm

42

Firms

28

Updated

September 2026

Asked at

All firmsMoody's7Bain Capital3SSState Street3AMAres Management2BLBlackRock2DED.E. Shaw2MSMorgan Stanley2Oaktree Capital Management2S&P Global2Bridgewater Associates1Citadel1FTFranklin Templeton1Golub Capital1HWHarris Williams1Houlihan Lokey1J.P. Morgan1Jane Street1MWMarshall Wace1Millennium Management1Morningstar1PIMCO1Sycamore Partners1TSTruist Securities1Two Sigma1Vanguard1WMWellington Management1Wells Fargo Securities1Wolverine Trading1

Topic

All topicsThree statements9Accounting policy and standards5Working capital and cash7Ratio analysis8Forecasting and budgeting9Variance and management reporting7Unit economics and costing8Capital budgeting7Cost of capital and valuation7Markets and rates5Modelling, Excel and data8Business partnering6Brainteasers and estimation4Fit and career10

Level

AnyCoreIntermediateHard

Type

AnyTechnicalCaseBrainteaserMarket viewFit

1. 001How are the three statements related and connected?Three statementsCorephone / first roundMoody'sGeneralist · New York · 2022

   Say this

   The P&L shows performance over a period, the balance sheet is a snapshot at a point in time, and the cash flow statement explains how you got from one balance sheet to the next. They join at exactly two places: net income and cash.

   Then walk it

   1. Net income is the bottom of the P&L and the top of the cash flow statement. From there you add back non-cash charges, adjust for working capital, then run investing and financing.
   2. The closing cash number from the cash flow statement is the cash line on the balance sheet. That is link one.
   3. Net income less dividends flows into retained earnings inside equity. That is link two.
   4. So the balance sheet balances because both halves of net income land in it, the cash it generated on the asset side and the earnings it kept on the equity side.
   5. The reason it matters in an FP&A seat is that you cannot forecast one statement alone. If I forecast revenue growth of 20 percent, receivables and inventory move, which changes cash, which changes interest, which changes net income. The three statements are one model.

   Where candidates lose it

   Reciting three definitions and stopping. The word in the question is 'connected'. Say the two linkage points out loud, ending cash onto the balance sheet and net income into retained earnings, or you have not answered it.

   Expect next

   • If you could only see one statement, which would you pick and why?
   • A company is profitable but running out of cash. Where do you look first?
   • Walk me through how 100 rupees of depreciation moves through all three.

   Reported by candidates at Moody's (Generalist, New York, 2022). Source: Wall Street Oasis.

2. 002What are some non-cash items on the cash flow statement?Three statementsCoretechnicalMoody'sProject Finance · New York · 2018

   Say this

   Depreciation and amortisation, share-based compensation, impairments and write-offs, provisions and their movements, deferred tax, unrealised foreign exchange gains and losses, and the equity-accounted share of profit from associates.

   Then walk it

   1. The rule is simple: anything that hit the P&L but did not move cash gets added back or subtracted in the operating section.
   2. D&A is the obvious one, and it is usually the largest. Impairments and write-offs of receivables or inventory are the same idea in one lumpy hit.
   3. Share-based compensation is a real cost to shareholders through dilution but never touches the bank account, so it is added back.
   4. Provisions are worth calling out separately because two things happen: the charge is non-cash when you create it, but the utilisation is real cash later. A clean cash flow statement shows both.
   5. Then the ones people forget. Deferred tax, because book tax and cash tax differ. Unrealised FX on translating a foreign loan. And share of associate profits, which you consolidate one line in the P&L but only receive as a dividend.
   6. The reason a credit analyst cares is that the bigger the gap between EBITDA and operating cash flow, the more the earnings are made of accounting rather than cash.

   Where candidates lose it

   Stopping at depreciation and amortisation. That answer is worth about four seconds. The list is what separates someone who has read a cash flow statement from someone who has built one, so get to provisions, deferred tax and unrealised FX.

   Expect next

   • Which of those would worry you most if it kept growing?
   • How would you test whether a company's earnings convert into cash?
   • Why is a provision charge non-cash but the utilisation cash?

   Reported by candidates at Moody's (Project Finance, New York, 2018). Source: Wall Street Oasis.

3. 003Why do we use accrual accounting at all, if cash is what matters?Three statementsCorephone / first roundCorporate FP&ABig Four

   Say this

   Because cash timing is arbitrary and accrual accounting matches effort to reward in the period it happened. Cash tells you whether you survive. Accrual tells you whether the business works.

   Then walk it

   1. Accrual recognises revenue when you deliver and cost when you consume, regardless of when money moves. That is what makes two periods comparable.
   2. A concrete case: an infra contractor collects a 30 percent advance in March and delivers over 18 months. On a cash basis March looks spectacular and the following year looks terrible. Neither is true.
   3. It also stops management from managing the number by moving a payment date. Paying a supplier on 2 April instead of 31 March changes cash and changes nothing about performance.
   4. The cost of accruals is judgement. Every accrual is an estimate: percentage of completion, useful life, expected credit loss, warranty provision. Judgement is where earnings get managed.
   5. So in practice I would read both. Accrual for the operating story, cash for the truth test. When the gap between them widens for more than two or three quarters, the accrual story is usually the one that is wrong.

   Where candidates lose it

   Answering 'because the standards require it'. That is a rule, not a reason. Name the matching principle and then name its cost, which is estimation judgement, because that is the answer an interviewer remembers.

   Expect next

   • Which accrual would you test first on a manufacturer?
   • Where does accrual accounting mislead you most?
   • What is the cash conversion ratio and what does a low one tell you?

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.