Questions for a business analyst interview

1- In your opinion, what qualities should a good BA have? Or What is the role of BA in an
Organisation?

Business analytics has emerged as one of the most in-demand talents among qualified individuals. It
is a means of transforming data into business insights, which drive decision-making. Analytics has
enabled organisations across different verticals to learn from their failures, identify patterns, and
enhance efficiency and results by relying on business. BAs are skilled communicators, problem
solvers, and critical thinkers. They can write requirements specifications, assess requirements, build
visual models, lead elicitation sessions, and utilise business analyst tools. Business analysts
understand how to discover answers to questions rather than waiting for them to come to them.
They seek alternate routes through the company and include the appropriate individuals at the
proper time. Good business analysts are rarely stuck for long and frequently work through
challenging conditions to find a solution.

As a business analyst, it is their primary role to understand what stakeholders demand and
communicate these requirements to developers and communicate the developer's expectations to
stakeholders. The ability of a business analyst for this job is communication abilities that may amaze
everyone. While transferring knowledge, he is the one who must turn it into words that make a
difference. This is, without a doubt, a large duty for him to bear since he must listen and execute,
which may appear simple, but only a qualified expert can handle all of this.

The business analyst’s role is to understand and explain the new feature updates to clients and take
feedback for further development. Based on client feedback, the Business Analyst instructs the
development team to make amendments or continue. At times, the client requests an additional
feature be added to a project, and the BA must determine whether or not it is feasible and then
assign resources if necessary to implement it.

2. What is the best method for gathering requirements? Or What are the core competencies of the
BA?

It is vital for Business Analysts to select approaches that work well for obtaining requirements. In
addition, the Business Analyst must select who will participate in this phase. When a Business
Analyst devotes time in generating a clear, succinct, precise, and quantifiable set of Requirements, it
typically ensures the development of high-quality software that meets the demands of the
customer. There are various approaches that Business Analysts may explore while obtaining
requirements from clients, depending on the project context. There are several approaches for
gathering requirements. Each approach is useful in a different situation. Most of the time, a Business
Analyst must employ a variety of strategies in order to obtain comprehensive and accurate
requirements from customers and stakeholders. Here are some of our favourite approaches for
obtaining requirements.

1- Interviews
2- Questionnaires
3- Prototyping
4- Document Analysis
5- Observation

The core competencies of a Business analyst are-

1- Communications skills
 2- Critical analysis skills
3- Problem-solving skills
4- Management and leadership skills
5- Technical awareness of projects
6- Tools and techniques skills

3) What are your preferred intelligence tools and why do you like them? Explain Moscow tool

Zoho Analytics is my preferred intelligence tool. most prominent features focus on blending data
from multiple sources and visualizing them through reports and dashboards via their drag-and-
drop designer. But not only, you can also feed data from their online storage service Zoho Docs.

MoSCoW prioritization is a tool for establishing a hierarchy of priorities during a project. It's
based on the agile method of project management, which aims to strictly establish factors like
the cost of a product, quality, and requirements as early as possible. “MoSCoW” is an acronym
for must-have, should-have, could-have, and won't-have, each denoting a category of
prioritization.

4) How would you explain the Scrum methodology to someone without technical knowledge?

The Scrum team collaborates like a sports team; in fact, the name is derived from a rugby scrum
(which is like a huddle in Football - in a way). They must communicate with one another in order
to coordinate various duties, thus establishing a consistent mechanism to check in on a daily
basis is critical. Instead of preparing for the entire season in advance, they plan in sprints, which
are generally 1-2 weeks long. Each sprint is like a game in which they have a strategy and strive
to execute it jointly in order to complete it. They assess what really transpired at the conclusion
of the sprint and utilise that knowledge to help them plan the next weeks of value.

5) You’ve never worked in finance before. How much do you know about what bankers do?

Based on that, you know that bankers advise companies on transactions - buying and selling other
companies and raising capital. They are "agents" that connect a company with the appropriate
buyer, seller, or investor.

-The day-to-day work involves creating presentations, financial analysis and marketing materials
such as Executive Summaries.

6) Where do you see yourself after 3/5/10 years?

Well, I’m really excited about this opening. In the next five years, I would like to be recognised as
an expert in this sector. This job will for sure provide me with a golden opportunity to do the
same. Since I already have a few years of work experience, I am excited to take up managerial
responsibilities in the coming few years. Besides, I have the potential to lead projects, and if I am
able to deliver, I am sure this organization will give me the chance to become one of the
forerunners. I would like to mention that in the past, I have worked with some amazing managers.
Under them, I have bloomed into a professional with great managerial skills myself. Five years
ago, I wanted to be where I am today. So five years from now, I want to set up realistic goals for
myself and also for my organization. I will keep the same fire alive within and I hope I will achieve
my goal.
7)Say, you identified a problem in the current approach. How’d you approach and solve it and
how did you know you are approaching right, a situation where you had to deal with
ambiguity?

In the early stages of my former employment, my management requested me to lead a meeting

with the new raw material supplier. I was provided with some information about the supplier, but
I had no idea how to organise a meeting in that firm because I was a new employee, but I knew If
my manager offered me this great chance, he must have recognised something in me, but he
didn't tell me exactly what materials we're working with and what the decided pitch and budget
are. I had an idea to fix this problem, so as soon as I came home, I investigated the previous year's
budget of the firm, as well as the contract with the same supplier, and I discussed how my boss
kept his pitch for the previous year's contract with my current co-workers. I learned a lot and was
capable of running the meeting. My manager was quite pleased with my performance.

8)If you have multiple alternative solutions for any problem, how do you decide which one to
go with?

You make a “SWOT (Strengths, Weaknesses, Opportunities and Threats) Analysis”, on both
options and choose the best.

9. Can you give an example of a situation where you gave an innovative out of the box solution
to any problem?

Creativity is the best way to solve problems. Last week I was assigned one college project, Two
teammates were having trouble understanding the work that the other one did, and this was
impacting the overall group. I pitched that the two individuals switch roles for two weeks to
better understand their impact on the project's success. They both came out of the experience
having felt a new appreciation for another's professor, and now they are cross-trained too.

10. How has your college helped you over the last 1.5 odd years? What do you intend to do
now, going forward?

College life is more than just what you learn from books and lectures. It is about what you have
learned from others around you. It is all about what you have learned from your experiences. It is
a stage of development. what I learn in the last 1.5years is time management, and study skills,
Learning to incorporate personal values and ethics into every aspect of life is a significant part of
personal growth during the college experience. Part of the path of integrity is learning how to
hang in there and stay committed to goals even when situations are challenging.

Accounting Questions: -

1. If Depreciation is a non-cash expense, why does it affect the cash balance?

Depreciation does not affect cash flow directly. It does, however, have an indirect impact on
cash flow because it changes the company’s tax liabilities, which reduces cash outflows from
income taxes. Essentially, when company prepares its income tax return, depreciation will be
 listed as an expense. This reduces the amount of taxable income you need to report to the
government, reducing the amount of cash that goes out of your business.

2. What’s the purpose of the “Changes in Working Capital” (AKA “Changes in Operating Assets

and Liabilities”) section of the Cash Flow Statement?

Working Capital is a Net Asset, and when an Asset increases, the corporation must spend cash to
do so, which is why it's listed this way on the Cash Flow Statement. Consider Inventory: if it
increases while no other items change, the corporation must have spent money on it. When a
result, as Working Capital rises, the company's cash flow falls, whereas as Working Capital falls,
the company's cash flow rises. That explains why when working capital increases, the Change in
Working Capital has a negative sign, whereas when working capital reduces, it has a positive sign.
Change in Working Capital indicates how much a company's cash flow will differ from its Net
Income (i.e., after-tax earnings), and organisations with more power to collect cash fast from
customers and defer payments to suppliers have higher Change in Working Capital values.

3. How do changes in Inventory affect the income statement?

Inventory is an asset and its ending balance is reported in the current asset section of a company's
balance sheet. Inventory is not an income statement account. However, the change in inventory is
a component in the calculation of the Cost of Goods Sold, which is often presented on a
company's income statement. An increase in inventory will be subtracted from a company's
purchases of goods, while a decrease in inventory will be added to a company's purchase of goods
to arrive at the cost of goods sold.[Rather than simply showing the change in inventory as an
adjustment to the cost of goods, some income statements will show the calculation of Cost of
Goods Sold as Beginning Inventory + Net Purchases = Goods Available - Ending Inventory.]

4. Could you ever end up with negative shareholders’ equity? What does it mean?

Negative equity refers to the negative balance of equity share capital in the balance sheet. This
situation usually happens when the company has incurred losses over a continuous period such
that they offset the reserves and equity capital appearing on the balance sheet.

In my last job company has paid more amounts of cash dividends than the profits it earned, which
can result in negative shareholder’s equity.

5. What does negative Working Capital mean? Is that a bad sign?

Negative working capital is when a company's current liabilities exceed its current assets. This
means that the liabilities that need to be paid within one year exceed the current assets that are
monetizable over the same period.
Negative Working Capital can be good or bad, depending on the trajectory of the Business. For
example, if a business is growing, Negative Working Capital can create extra cash flow. However, a
Business with Negative Working Capital declines, it will likely require funding on the way down, which
is often problematic.

Negative Working Capital is a double-edged sword. It’s excellent for growing Businesses (greater Cash
Flow and often Valuation) but terrible for declining Businesses (requires cash investment during
decline).

6. What’s the difference between accounts receivable and deferred revenue?

Deferred Revenue is recorded as a liability rather than an asset on a company's balance sheet.
Payments made in advance of services or goods that have not yet been delivered are referred to
as advance payments. It's also known as unearned income because the payment was made but
not yet earned. An example of this would be an annual subscription to software, for which the
software company would earn one-twelfth of the deferred revenue each month.

Accounts Receivable: is an asset on the balance sheet until payment is received. It refers to
current assets or sales to be collected in the near future - i.e. services or products that have been
sold/are now owned by the customer, but the customer is yet to make payment, for example,
goods or services sold on credit.

7. Normally Goodwill remains constant on the Balance Sheet – why would it be impaired.

Typically, this occurs after a company has been acquired and the acquirer reassesses its
intangible assets (such as customers, brand, and intellectual property) and discovers that they
are worth significantly less than they were previously thought. It frequently occurs in
acquisitions where the buyer "overpaid" for the seller, resulting in a large net loss on the
Income Statement (see: eBay/Skype). It can also occur when a company discontinues a
portion of its operations and must impair the associated goodwill.

8. Under what circumstances would Goodwill increase?

Technically, goodwill can increase if the company reassesses its worth and discovers that it is
worth more, but this is uncommon. Typically, one of two scenarios occurs:

1. The company is acquired or bought out, and Goodwill changes as a result because it is an
accounting "plug" for the acquisition price.

2. The company buys another company for more than its assets are worth, which is reflected
in the Goodwill figure.
9. How is GAAP accounting different from tax accounting?

Differences between GAAP accounting and Tax accounting:

The difference between GAAP accounting and tax accounting has been detailed below:

1. Principles applied- GAAP accounting involves drawing up financial statements while adhering to
accounting standards and rules. Tax accounting involves accounting as per tax rules and
principles.

2. Purpose- The purpose of GAAP accounting is to result in the preparation of reliable and
comparable financial statements for reporting purposes. The purpose of tax accounting is to
arrive at taxable income for a specific period.

3. Accounting basis - GAAP accounting provides for a mercantile/accrual basis of accounting. Tax
accounting allows for use of cash, accrual or modified basis of accounting.

4. Regulated by - GAAP accounting is generally regulated by accounting and regulatory boards

such as the Securities and Exchange Commission and Financial Accounting Standards Board in the
USA. Tax accounting is regulated by the tax regulatory authorities of the jurisdiction such as the
Internal Revenue Service in the USA.

5. Transactions recorded- GAAP accounting seeks to record all transactions entered into by an
entity. All expenses and incomes are recorded on an accrual basis as and when they are incurred.
Tax accounting seeks to record only those transactions which have an impact on the taxable
income of an entity.

10. What are deferred tax assets/liabilities and how do they arise?

Deferred Tax Asset- When a tax amount has been paid or carried forward but not yet recognised
in the income statement, it is referred to as a deferred tax asset. The difference between the book
and taxable income is used to calculate the value of deferred tax assets.

Following are the reasons which give rise to deferred tax assets.

 Expenses are taken into account by the taxing authority even before they are required to
be recognized
 Revenue earned is taxed even before the time when it should be recognized
 The tax rules or base for assets and liabilities are different

Deferred tax liability

Deferred tax liability arises when there is a difference between what a company can deduct as
tax and the tax that is there for accounting purposes. A deferred tax liability signifies that a
company may in the future pay more income tax because of a transaction in the present.

Listed below are a few reasons which result in deferred tax liability arising for a company.
  Dual accounting of figures. For example, most corporates keep multiple copies of
financial statements for their personal use as well as those that are furnished to the
public and the tax authorities. This is also because standard accounting rules and tax
code differs heavily in key areas like revenue, expense, and depreciation of the asset.
 Companies generally aim to push their profits in order to show maximum profits to
their shareholders.
 Companies generally tend to push current profits also into the future to reduce the
tax burden. This allows more money for investment purposes rather than paying it off
as tax to the government.

Case Based Q&A: Analytical –

1. Guesstimate regarding the number of delivery boys required to do 1-day delivery in

Jamshedpur.
Assuming Jamshedpur Population is 1 Lakhs
Lets divide them into class, Rich, Middle Class and Below Poverty line
Assuming Rich are 20%, Middle class are 40% and BPL are 40%. So we have numbers :
Rich = 20 thousands
MC = 40 thousands
BPL = 40 thousands
Let’s assume BPL people don’t even have mobile or internet connections. So we are left with 60
Lakhs people. Now assuming
100% Rich have mobile or internet connections and only 50% Middle class have mobile or internet
connections. The numbers will become:
Rich = 20000
Middle Class = 20000
Now let’s assume the family size of Jamshedpur is 4. So, numbers become:
Rich = 20/4 = 5 thousands families
Middle Class = 20/5 = 5 thousands families.
Now Assuming every second Rich family orders online every day and every fifth Middle- Class
family orders online every day. So number becomes:
Rich = 5/2 = 2.5 thousands Order every day

2. Client runs a chain of hospitals across India. They want to open specialized maternity care
centres. Estimate the market potential and the number of centres to be launched.

3. Estimate the electrical car market size in India/ any city

Assumptions: No. of EV means: considering the personal EVs, not any rental service or any tours &
travels organization

Only considering the Cars & Bikes/scooty

No. of the population in Bangalore = 13 Million (130 lakhs)

Considering Bangalore as the fastest-growing tech city:

The total number of smartphone users = 70% of 13M = 9100000 (91 lakhs)
Age
Type of people percentage number
limit
 Job holders 25 - 60 20% 18,20,000

Students / Adults 15 - 25 45% 40,95,000

Job seekers 20 - 35 15% 13,65,000

18,20,000
Households (Family member of job holders) 15 - 70 20%
 
 Now, considering that the job holder category people will be requiring a vehicle for travel
 Among those 18,20,000 job holder people
o 80% people prefers rental vehicle or sharing vehicles (14,56,000)
o 20% of people use their personal vehicle (3,64,000)
 
 Among the 3,64,000 people who use their personal vehicles
o 70% are bikes/scooty (2,54,800)
o 30% are cars (1,09,200)
 
 Among 2,54,800 bikes: 95% are fuel vehicles & 5% are EVs(12,740)
 Among 1,09,200 cars: 98% are fuel vehicles & 2% are EVs(2184)
 
 So, approximately total (12,740 + 2,184 = 14,924) ~ 15,000 Electric vehicles(EVs) are
there in Bangalore.
 

4. A leading DTH company with over 33% Market share is facing a very high churn rate of
customers in low ARPU (average revenue per user markets like UP. The company subsidies
set-top boxes and recover it only after 2.5-3 years of continuous subscription. However,
people have a tendency to shift to FTA (free to air) operators like DD Direct Plus. What
strategy should the company adopt: continue serving these markets with subsidised set-top
boxes, service only profitable markets or some other strategy.

5. If you were the PM, what two major policy changes you would want to do to see India grow
at a growth rate, it deserves?
I'd work to improve our economy by reducing barriers that stifle it. In the current capitalistic
culture, education is an important part of the process of becoming a worker. Education for
women is woefully inadequate. Women with higher levels of education are more likely to work
and contribute to the economy. It's important to be aware. As a result, I'd place a strong focus on
the advantages of female education.
I intend to boost pharmaceutical output and improve grain management, as well as revive the
agriculture industry. I'd like to try to bring more labour-intensive jobs to India, which has a large
population and a 3.9 per cent unemployment rate. I'd also like to privatise government
enterprises that are losing money, such as Air India. I'd like to develop our international relations
with countries like Pakistan and Russia, as this will help us expand our business opportunities. On
all fronts, I aim to encourage equality.
Case-based Q&A: Accounting
1. If I were stranded on a desert island, only had 1 statement and I wanted to review the
overall health of a company – which statement would I use and why?
Cash flow statement because it gives a true picture of how much cash the company is actually
generating

2. Let’s say I could only look at 2 statements to assess a company’s prospects – which 2 would I
use and why?
I'd choose the Income Statement and Balance Sheet because I can generate the Cash Flow
Statement from both, assuming that I have "Beginning" and "Ending" Balance Sheets that
correspond to the same period the Income Statement is tracking.

3. Recently, banks have been writing down their assets and taking huge quarterly losses. Walk
me through what happens on the 3 statements when there’s a write-down of $100.
First, the $100 write-down appears on the Income Statement in the Pre-Tax Income line. Net
Income is reduced by $60 with a 40% tax rate.
Net Income is down by $60 on the Cash Flow Statement, but the write-down is a non-cash
expense, so we add it back – and thus Cash Flow from Operations is up by $40.
Overall, the Net Cash Change increases by $40.

4. Walk me through a $100 “bailout” of a company and how it affects the 3 statements.
First, confirm the type of "bailout" – debt? Equity? Is it a combination? The most common
scenario here is a government equity investment, so here's what happens:
There have been no changes to the Income Statement. The Cash Flow Statement shows that Cash
Flow from Financing has increased by $100 to reflect the government's investment, so the Net
Change in Cash has increased by $100.
On the Balance Sheet, Cash is up by $100, so Assets are up by $100; however, Shareholders'
Equity must increase by $100 to balance.

5. A company has had positive EBITDA for the past 10 years, but it recently went bankrupt.
How could this happen?
There are several possibilities:
1. The company spends too much on Capital Expenditures, which are not reflected in EBITDA and
may still be cash-flow negative.
2. The company has a high-interest expense and is unable to service its debt.
3. The company's debt matures all at once, and it is unable to refinance it due to a "credit crunch"
– and it runs out of cash completely when repaying the debt.
4. It has significant one-time charges (for example, from litigation) that are large enough to
bankrupt the company.
Remember that EBITDA excludes long-term asset investment (and depreciation), interest, and
one-time charges – all of which could bankrupt the company.