In this financial analyst job description blog post, we explain what financial analysts do, the different types of financial analyst roles, and the skills you’ll need to become a financial analyst. Furthermore, we also dive into details about the specific responsibilities of a financial analyst and list out potential job titles with related responsibilities that are similar to being a financial analyst. The average base salary for a Financial Analyst ranges from $78,000 to $129,000 largely depending on the city in which the role resides and the company.
A financial analyst is a person who performs financial risk assessment, financial forecasting, and financial statement analysis. The financial analyst job description includes assessing the financial performance of a company or a business unit by reviewing the financial statements and key metrics. Moreover, a financial analyst may also conduct a sensitivity analysis to determine the effect of changes in key assumptions on the business’ financial performance. Generally, financial analysts work in the finance department of a company. Their job description includes preparing sales forecasts, preparing operational budgets, analyzing financial performance, and identifying financial risks. A financial analyst job description will vary depending on the industry sector and company. If you want to become a financial analyst, then it is important that you understand the financial analyst job description.
Financial analysts usually work in one of three areas: Investment, Corporate Finance, and Risk. Investment analysts research and recommend stocks and bonds. Corporate finance financial analysts evaluate the financial needs of a company and make financial recommendations. Risk analysts assess the financial risk of a company and provide risk management strategies. The type of financial analyst you become depends on your interests, strengths, and weaknesses. Investment analysts research stocks, bonds, and other instruments for clients to determine whether to buy, hold, or sell. They also forecast trends in the financial markets. Corporate finance financial analysts study the finances of a company to determine its need for funds and the best way to obtain them. Risk analysts assess the risk of a company with respect to financial loss and recommend ways to minimize those risks.
Analyzing financial information - A financial analyst job description includes analyzing financial information such as earnings, sales, cash flow, and financial statements. Financial analysts use tools such as Excel, Access, and Powerpoint to organize and analyze data.
Preparing sales forecasts - A financial analyst creates sales forecasts by analyzing past sales data and other factors such as economic conditions. The sales forecast assists senior management teams in maintaining or increasing revenue at a company.
Preparing operational budgets - A financial analyst creates operational budgets for departments such as sales, marketing, and operations. This helps ensure that the departments have the necessary resources to function effectively.
Analyzing financial performance - A financial analyst reviews financial performance such as sales, expenses, and profit to identify potential risks and opportunities for the company.
Identifying financial risks - A financial analyst identifies potential financial risks such as cash flow issues, accounting issues, and interest rate risk.
To become a financial analyst, you need to have strong analytical skills, excellent communication skills, and be able to work under pressure. The first step to become a financial analyst is to choose a college. You can become a financial analyst if you major in a business-related field such as economics, accounting, finance, or mathematics. When you are in college, you should take as many financial analysis and investment-related courses as possible. These courses will help to prepare you for a financial analyst job. You should also take courses that prepare you for a career in business management.
Accounts Payable Manager - An accounts payable manager manages the accounts payable function of a company. Their job description includes monitoring and controlling accounts payable, ensuring timely payment of suppliers, and preparing cash flow forecasts.
Accounts Receivable Manager - An accounts receivables manager manages the accounts receivables function of a company. Their job description includes monitoring and controlling accounts receivables, developing and enforcing credit policies, and assessing credit risk.
Accountant - An accountant performs financial and management accounting activities for a company such as recording and classifying business transactions. Their job description includes developing accounting policies and procedures, managing the accounting function, and providing financial analyses to management.
Budget Analyst - A budget analyst plans and conducts financial and budgeting analyses for a company. Their job description includes identifying budgeting issues and recommending corrective actions.
Cash Flow Analyst - A cash flow analyst plans, collects, analyzes, and distributes cash flow information. Their job description includes forecasting cash flows and identifying cash flow problems.
To sum up, a financial analyst is a person who performs financial risk assessment, financial forecasting, and financial statement analysis. The financial analyst job description includes analyzing financial information such as earnings, sales, cash flow, and financial statements. Moreover, a financial analyst also creates sales forecasts, prepares operational budgets, analyzes financial performance, and identifies financial risks. To become a financial analyst, you need to have strong analytical skills, excellent communication skills, and be able to work under pressure. Common jobs for financial analysts include account payable manager, accounts receivable manager, accountant, budget analyst, and cash flow analyst.
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