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. 016Receivable days went up 10 and payable days came down 10. Which worries you more?Working capital and cashIntermediatetechnicalCorporate FP&ATreasury

   Say this

   They cost the same cash, but receivable days worry me more because that signal comes from your customers, and it usually means either credit quality is deteriorating or you bought revenue with terms. Payable days falling is more often a self-inflicted or supplier-driven choice.

   Then walk it

   1. On the arithmetic they are close to identical. Ten days of cost of sales out of the business either way, so the cash impact does not decide it.
   2. Receivables rising tells you something about demand. Either customers cannot pay, or the sales team extended terms to close the quarter. Both mean the reported revenue is lower quality than it looks.
   3. The test is ageing. If the increase sits in the over-90-day bucket, that is a collection and credit problem heading for a write-off. If it is spread evenly, it is more likely a terms change.
   4. Payables falling has three benign explanations: you took an early-payment discount, you switched to a supplier with tighter terms, or you lost your own credit standing with suppliers. The third one is the dangerous version, and it is a real distress signal.
   5. So my order of investigation is ageing first, then the discount and supplier-terms question, then whether the supplier is demanding advances because of concern about you.
   6. Practically, in an Indian mid-cap I would also check whether receivables sit with government or PSU customers, where 120 days is normal and not a quality signal at all.

   Where candidates lose it

   Treating this as an arithmetic question. The cash effect is the same; the question is about what each movement signals. Say 'receivables, because that signal comes from outside the company', then give the ageing test.

   Expect next

   • How would you read the receivables ageing note?
   • What would make falling payable days a distress signal?
   • How do you handle PSU receivables in a forecast?
2. 018Is negative working capital a good thing or a bad thing?Working capital and cashIntermediatetechnicalCorporate FP&ARating agencies

   Say this

   Usually good, and occasionally the first sign of distress. It means suppliers and customers are funding your operations, so growth generates cash instead of consuming it. It turns bad when it is caused by stretching payables you cannot pay.

   Then walk it

   1. The healthy version: a food retailer or a QSR collects cash at the counter and pays suppliers in 45 days. Grow the store count and cash comes in ahead of the cost. Same for a marketplace holding customer advances.
   2. Why it is valuable: every rupee of growth is self-funded, so return on capital employed is structurally high and the business needs almost no external working capital line.
   3. The distress version looks identical in the ratio. A company that has run out of cash also has payables ballooning, but because it cannot pay them. The difference is whether payables are stretched by contract or by default.
   4. So the test is the quality of the payables. Are terms contractual and consistent, is there an ageing problem, are suppliers demanding advances or letters of credit, and is there a spike in the last month of the year?
   5. The second risk is fragility. A negative working capital business unwinds violently if volumes fall. Sales drop, you stop buying, payables collapse and you have to fund the unwind in cash. That is how a good model kills a company in one bad quarter.
   6. So I would say: excellent while growing, dangerous while shrinking, and always check whether the payables are chosen or forced.

   Where candidates lose it

   Answering 'good' and stopping. The interesting half is the unwind risk when volumes fall and the fact that distress produces the same ratio. Saying both is what makes the answer sound like experience rather than a textbook.

   Expect next

   • How would you distinguish stretched payables from negotiated terms?
   • What happens to that business in a 20 percent volume decline?
   • Which Indian sectors run this model?

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.