Financial Analyst Job Description

Publication Date :

18 Jun, 2018

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Financial Analyst Job Description Guide

A Financial Analyst is a person who implements the fundamentals of financial analysis to evaluate the company's position from the point of view of raising capital in the form of debt or equity, credit ratings, or budging. They are expected to analyze various scenarios including but not limited to current situations in the market, and come up with intelligent inferences.

For example, a ‘credit analyst’ in a bank is primarily responsible for deciding if a loan should be given (also called loan sanction by bank officers) to people who come to the bank to borrow money. Several factors are responsible for deciding if a person can get a loan from the bank.

Factors to Get a Loan From the Bank

Whether the person who wants to borrow money is employed or not?
If there is any other loan already taken by the person?

These are some of the many factors a 'credit analyst' takes into account before deciding on whether the bank should lend money or not.

Similarly, a 'financial analyst' is one who 'studies' a company and tries to make predictions about the company's financial health in the future. As we mentioned earlier, an analyst has to look at multiple factors before making decisions. Similarly, a financial analyst also has several factors to analyze and understand before reaching conclusions about that particular company.

The foremost Financial Analyst job description is to study financial statements of companies. Just like we, as students, are issued grade cards by our school teacher with different grades for different subjects and an overall assessment of our year-round performance, companies also issue their financial statements, which consist of information on how they performed their businesses throughout the year.

Financial Analyst Job Description Guide

Sample Job Description

Below is a sample Financial Analyst Job Description.

Financial Analyst supports and analyzes company financials monthly, quarterly, and annual and assists in preparing and forecasting the annual budget. Below are some of the key responsibilities of a Financial Analyst -

Support monthly and year-end accounting
Analyze business units' performance every month and provide budget vs variance analysis as well as forecasts
Financial modeling resulting in forecasting of revenue, expenses, headcounts, balance sheet, and cash flows
monitor the key financial metrics of the company
perform performing ad-hoc analysis and new project break-even analysis
Provide key business analysis and strategic recommendations on pricing, investment, make vs. buy, ROI cost reduction, and controls.
Assist in due diligence and identification of business acquisition targets

What does a financial analyst do? Video Explanation

Key Qualifications

Below are the key qualifications required by Financial Analyst -

Typically a graduate-level course in Accounting & Commerce, Finance is necessary.
Candidates with Engineering background/STEM courses are preferred as they have quantitative and programming skills.
Candidates from Business Schools with a specialization in Finance have an advantage as they can read financial statements easily, be aware of different accounting practices, and understand market conditions more easily.
Stronghold on Statistics-forecasting techniques, risk modeling, Value At Risk calculations
Applied Mathematics and Economics knowledge- to analyze current economic conditions and predictions for future economic indicators
Mathematical modeling for in-depth data analyses using traditional and advanced methods
A Financial Analyst is expected to have good presentations and communication skills.

Skills

Here is the list of top skills and knowledge that a Financial analyst must possess –

Working knowledge of MS-Excel
Knowledge of database management systems is required to store data.
Hands-on Experience in VBA-Macros
Knowledge of accounting procedures and financial reporting practices
Ability to design dashboards showcasing information in the data; one should work on software like PowerBI.
Financial Modeling in excel
Strong command of English and good conversational skills
Ability to swiftly coordinate amongst different departments of an organization which may all be using data stored by him, reports generated by him, or recommendations made to the senior management
Ensure timely communication of results/reports to key personnel within the organization as well as clients

Conclusion

In conclusion, as a financial analyst, one is responsible for showcasing the company's report card to various stakeholders. In addition, one is also responsible for making future predictions on where the company analyzed its business. In the end, it can be seen that a financial analyst needs to have different skill-sets for different financial analyst jobs for graduates like financial statement analysis, database management, modeling, predictions, and report writing.