Why this matters:
Debt and equity are the two primary forms of funding company growth, and there are advantages and downsides to each. For example, while equity financing is advantageous in the sense that there’s no repayment obligation or interest on the funds, it does dilute control of the principal stock owners. And while debt provides more control, it also comes with more risks, like bankruptcy.
What to listen for:
- Signs that the candidate is comfortable discussing these financial concepts and has an intimate knowledge of the pros and cons of each
- Top answers that emphasize the company’s goals — for example, that debt helps management retain control
Why this matters:
A financial model provides a summary of a company’s expenses and earnings in spreadsheet form. These models allow companies to determine the impact of a future event and can help guide the decision-making process. There are different types of financial models, but they share a common purpose: pulling together data to inform the reader.
What to listen for:
- Answers that stress the importance of displaying complex information in a clear, consistent way
- Mentions of color coding, cross-checking capabilities, and the ability to produce a dashboard of graphics to easily display key metrics
Why this matters:
A true finance professional will know that every company has different reasons for entering into a mergers-and-acquisitions (M&A) agreement. There’s no simple answer to this question, but a qualified finance professional should have no difficulty discussing the key factors at play in most cases.
What to listen for:
- Answers that mention sharing resources, taking control of a larger percentage of the market, or eliminating direct competition
- Answers that touch upon factors that lead to a successful M&A agreement, such as harmonious corporate cultures
Why this matters:
Disagreement and differing viewpoints aren’t just common in business — they help build healthy discourse. You want to know whether your candidate can be tactful when standing up for their convictions, especially when they’re confident it’s in the best interests of the company.
What to listen for:
- Evidence that the candidate gathers all relevant facts before taking a stand, rather than acts impulsively
- The candidate’s attitude when answering — an arrogant or frustrated tone could be a red flag
Why this matters:
Everyone has faced significant challenges or failed at something — and the way a person handles these hurdles can tell you a lot about their character. In finance, being able to manage pressure is a requisite. This question can help you assess whether a candidate is equipped to navigate pressure and come out stronger for it.
What to listen for:
- Answers that focus on incomplete data, an obstructive manager, or an unrealistic deadline
- Reluctance to describe a challenge, or claims that they’ve never faced one — these could be a bad sign
Why this matters:
Qualified finance professionals read the numbers. Great finance professionals have an innate and holistic understanding of them. On paper, numbers can look good or even too good, but your new hire will ideally have an intuitive feel for when things don’t add up, and they won’t hesitate to put in the work to double-check.
What to listen for:
- Factors such as a projection that seemed too rosy or a competitor threat that was being underestimated
- Signs that the candidate has a strong sense of what drives metrics and the importance of qualitative factors
Why this matters:
This question can help you assess a candidate’s leadership potential and strategic thinking. Even if they don’t know a great deal about your company’s financial standing, they should be able to apply their knowledge of the market to pinpoint key concerns and highlight some strategies they’d focus on.
What to listen for:
- Answers that demonstrate the candidate can quickly provide a broad overview of the company’s financial position
- Answers that touch on three financial measurement tools: income statement, balance sheet, and statement of cash flow
Why this matters:
Evaluating the fiscal health and future of a company is a key role of the finance professional. With this question, you’re interested not only in the stock the candidate chooses, but also the thought process behind it. A candidate who is passionate about finance will want to have skin in the game, so they’ve likely pondered this question already.
What to listen for:
- Answers that display the candidate’s knowledge and curiosity about both quantitative and qualitative measures
- Strong answers that demonstrate the candidate’s ability to persuasively articulate their thoughts
Why this matters:
Finance professionals don’t just work with the finance department. They need to work with teams in legal and compliance for reporting, operations for sourcing numbers, investor relations for explaining performance, and management and the board of directors for analyzing performance and charting the company’s future. Teamwork and communication skills are critical to getting these jobs done right.
What to listen for:
- Answers that highlight a commitment to strong collaboration and communication
- Indications that the candidate may not be a team player — for example, if they position themself as the hero and don’t share credit with other team members
Contact a sales specialist.