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Abdulwahab
Student
Granada, Andalusia, Spain
41
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What kinds of decisions do you make as a Financial analyst?
What kinds of decisions do you make as a Financial analyst? #business #finance #business-analysis #corporate-finance #financial-analysis
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15 answers
Troy Hooper
Finance
2
Answers
Minneapolis, Minnesota
Updated
Troy’s Answer
A Financial Analyst plays a critical role in helping their organization make business decisions by serving as a trusted advisor to their business partners. Depending on which facet of Financial Planning and Analysis (FP&A) you work on, the type of decisions you influence will vary widely. From my experience in various roles as a Financial Analyst, I have been involved in decisions with vendor selection, capital budgeting and expense forecasting submissions, resource allocation to various projects, the headcount allocation process, and even which types of discounts the company should offer its customers.
As you can see, there are a wide range of opportunities to make an impact on the organization as a Financial Analyst, and it is a great way to become familiar with a businesses operations in preparation for future roles.
As you can see, there are a wide range of opportunities to make an impact on the organization as a Financial Analyst, and it is a great way to become familiar with a businesses operations in preparation for future roles.
Jian Kang
Finance
4
Answers
Round Rock, Texas
Updated
Jian’s Answer
I am a corporate financial analyst. I provided a lot of analytics to management to highlight issues and opportunities, to help management to make right decision.
Stephanie Murnen
Sr. Manager, Surgical Gloves Marketing at Cardinal Health
84
Answers
Columbus, Ohio
Updated
Stephanie’s Answer
http://talentegg.ca/incubator/2012/10/04/financial-analyst/
http://www.investopedia.com/articles/professionals/090815/career-advice-financial-analyst-vs-accountant.asp?lgl=bnull-baseline-below-content
As a financial analyst you use data to make all kinds of decisions. You can decide between different scenarios for a business case with financial modeling, you can run profitability analysis and projection statements to decide on price point on a product or service, and you can run calculations to understand the current and long term impacts on a capital investment, like a real estate purchase.
Analysts can run various reports on sales, units, profits, customer retention rates, etc to assess the current state of the business, to understand the different driver affecting the profitability of the business, and to make decisions about where the company can invest money. It can be a lot of fun using data to back up decisions you can feel confident in, and a strong financial analyst can find a job anywhere as it's such an important strength for any business to have!
Nikki Aquino
Financial Analyst
16
Answers
Rolling Meadows, Illinois
Updated
Nikki’s Answer
Hi Abdulwahab - Great question! A financial analyst's role is to arm decision makers with actionable information and provide insight into the financial impact of key initiatives.
Here are some of the questions I have come across as a financial analyst:
- What is the revenue benefit and /or cost impact of the initiative?
- What are the options/alternatives available and what is the revenue/cost for each option? Ex. what is the revenue/cost impact if we sell X units, Y units, Z units, etc.
- If we want to achieve a certain level of revenue increase or cost reduction, what needs to be true?
- What are the financial risks of the initiative? If certain assumptions are incorrect, what is the impact in dollars?
Hope this helps and good luck in your career journey!
Here are some of the questions I have come across as a financial analyst:
- What is the revenue benefit and /or cost impact of the initiative?
- What are the options/alternatives available and what is the revenue/cost for each option? Ex. what is the revenue/cost impact if we sell X units, Y units, Z units, etc.
- If we want to achieve a certain level of revenue increase or cost reduction, what needs to be true?
- What are the financial risks of the initiative? If certain assumptions are incorrect, what is the impact in dollars?
Hope this helps and good luck in your career journey!
Andy Edwards
Financial Analyst
1
Answer
Woodstock, Georgia
Updated
Andy’s Answer
As a financial analyst you will asked to provide analysis and explanations related to performance to budget, outlook and forecast. In addition there will be other ad hoc issues that will need to be researched and explained. When providing explanations to leadership and upper management, you will want to summarize the issue and communicate in a clear and concise manner. In doing so, you will need to make decisions around what is causing the issue and decide what reporting, visuals, graphs and/or charts best support your explanations.
James Schroeder
Financial Analyst
5
Answers
Tampa, Florida
Updated
James’s Answer
I personally am a financial analyst who specializes in forecasting revenue for my company. I am making decisions everyday by initially pulling our daily revenues from products, looking at trends and averages for Business Days, Weekend Days, Holidays, etc. We then are trying to extrapolate that out for the rest of the quarter to guide the overarching company forecast. I have to decide each week if the uptrend/downtrend is valid, or skewed by one-time events, where the revenue is coming from and if we can expect that to continue. Then come month-end, we have to engage with accounting to understand if they will be booking credits against revenue (and therefore reducing the revenue that gets officially recognized)
Vaidehi Jani
Job
1
Answer
Bengaluru, Karnataka, India
Updated
Vaidehi’s Answer
A financial anaylst usually will analyze the financial strength of the business/operations/sales or any other such function. There is usually a business partner or stake-holder corresponding to a financial analyst role.
A true finance person acts as a trusted advisor and a custodian of the financial health of the business, adherence to company policies and the widely accepted finance and accounting principles.
The kind of decisions in the role in a day to day perspective could be reporting, analysis, scaling & comparison vs. previous year, quarter, comparison vs. other segments, regions, industry benchmarks and giving insights to the business stake holder on how the business can be made more efficient. The idea is to make the most for every dollar spent by the business. It is important to look in to performance & efficiency KPIs, metrics, target achievements, etc.
There are times when the analyst has to take hard decisions when it comes to ethics & compliance, workforce reductions, etc. as well.
A true finance person acts as a trusted advisor and a custodian of the financial health of the business, adherence to company policies and the widely accepted finance and accounting principles.
The kind of decisions in the role in a day to day perspective could be reporting, analysis, scaling & comparison vs. previous year, quarter, comparison vs. other segments, regions, industry benchmarks and giving insights to the business stake holder on how the business can be made more efficient. The idea is to make the most for every dollar spent by the business. It is important to look in to performance & efficiency KPIs, metrics, target achievements, etc.
There are times when the analyst has to take hard decisions when it comes to ethics & compliance, workforce reductions, etc. as well.
Candra Miller
Complex Collections Project Manager
1
Answer
Minneapolis, Minnesota
Updated
Candra’s Answer
In your role as a financial analyst, you are tasked with numerous important decisions. Your duties include examining financial data to assess whether clients are financially secure, and if they pose any potential risk to your company. Sometimes, you might need to make significant decisions that may not necessarily please your clients. However, it's crucial to remember that your primary concern should always be the welfare of your company.
Jaya Swaroop
Financial Analyst
2
Answers
Wrocław, Lower Silesian Voivodeship, Poland
Updated
Jaya’s Answer
There are several financial analyst roles, but key responsibility on this role will include financial reporting and data analytics, you will be a trusted partner to the business and reporting the financials to the management and stakeholders. As a financial analyst you will play key role in budgeting, spend analysis, forecasting, etc., which are some of the key responsibilities.
Sean Dineen
Valuation
3
Answers
New York, New York
Updated
Sean’s Answer
Hello Abdulwahab
There are many different types of financial analysts. However, I would say that their roles can generally be broken into 2 parts. The first part or science relates to using the correct techniques or methodologies which can be learned in school such as forecasting or valuation methodologies. The second part or art is based on experience and involves judgements because all financial analysis is about time and how it and the financial markets effect money. These judgements should be well thought out and supported. One can gain experience by getting a job in finance after completing school and learning all you can from those that have been in the business much longer than yourself.
Best of luck!
There are many different types of financial analysts. However, I would say that their roles can generally be broken into 2 parts. The first part or science relates to using the correct techniques or methodologies which can be learned in school such as forecasting or valuation methodologies. The second part or art is based on experience and involves judgements because all financial analysis is about time and how it and the financial markets effect money. These judgements should be well thought out and supported. One can gain experience by getting a job in finance after completing school and learning all you can from those that have been in the business much longer than yourself.
Best of luck!
Scott Bastek
Analytics
4
Answers
Santa Monica, California
Updated
Scott’s Answer
A Financial Analyst typically performs work to contribute to the larger decision-making process of the Finance team at large. The Financial Analyst role is typically relatively entry-level, so the role itself doesn't make final decisions often directly.
The work is still incredibly important and exciting - it collects data from across the company and from comparable companies and industries, prepares analysis and models to "make sense of the data", and cooperates in the team's processing of that information to reach the optimal decision.
The work is still incredibly important and exciting - it collects data from across the company and from comparable companies and industries, prepares analysis and models to "make sense of the data", and cooperates in the team's processing of that information to reach the optimal decision.
Sarada JH
Financial Analyst
9
Answers
Bengaluru, Karnataka, India
Updated
Sarada’s Answer
As a financial analyst you enable decision making for the business and hence you play a key role in making financial decision.
As a financial analyst you will also be involved in reporting and analysis. Communication is also equally important as you need to present your view......
As a financial analyst you will also be involved in reporting and analysis. Communication is also equally important as you need to present your view......
R S
Finance
2
Answers
Seattle, Washington
Updated
R’s Answer
Financial analyst is typically responsible for preparing an annual budget, completing quarterly forecasts, as well has having "month-end" responsibilities such as actuals reporting, variance analysis, highlighting risks/opportunities. There are also various one time analysis requests that can come your way.
Additionally, there are various areas of finance where responsibilities of a financial analyst may vary some. A financial analyst working on a revenue team may be asked to forecast future period revenue and present those projections to senior leadership with all the supporting assumptions.
Financial analyst responsible for an organization's headcount will work closely with business partners across organization to understand hiring plans, timing of those hires, any challenges, and track attrition. That data then gets turned into a dollar forecast which helps your senior leadership make decisions on company expenses.
Financial analyst working specifically in a Cost of Goods sold area of the company may be responsible for tracking all the expenses associated with making and selling the product. You may be tasked with how to drive down this cost to make the company more profitable.
Additionally, there are various areas of finance where responsibilities of a financial analyst may vary some. A financial analyst working on a revenue team may be asked to forecast future period revenue and present those projections to senior leadership with all the supporting assumptions.
Financial analyst responsible for an organization's headcount will work closely with business partners across organization to understand hiring plans, timing of those hires, any challenges, and track attrition. That data then gets turned into a dollar forecast which helps your senior leadership make decisions on company expenses.
Financial analyst working specifically in a Cost of Goods sold area of the company may be responsible for tracking all the expenses associated with making and selling the product. You may be tasked with how to drive down this cost to make the company more profitable.
Naren Vutukuru
Financial Analyst
2
Answers
San Jose, California
Updated
Naren’s Answer
Financial Analyst are mainly service/support roles designed to support different areas of the business (Sales, IT, Product, etc.) The role of the financial analyst is to help the business make decisions that maximize the value of the business. For example, the company may be losing money and wants to decide which product is dragging profits down the most. A financial analyst would then analyze historical data to determine which product lines are losing the most money and why. This analysis will be used to support decisions that management makes.
Andrew Weisman
Finance
1
Answer
Sharon, Massachusetts
Updated
Andrew’s Answer
As a financial analyst you'll become the subject matter export for the part of the business you're supporting. Teams will seek your input on actual performance to date vs budget as well as where you expect to finish by the end of the year (via estimates, trends, forecasts, etc.) While you might not be the ultimate decision maker on the go forward strategy, you can provide historical information, guidance on risks and opportunities and sensitivity analysis for different scenarios to help make the most optimal decision.