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Finance concepts in case interview

Anonymous A

Hi,

i am a statistics major and I want to apply to consulting firms. I would like to know what are the most important financial concepts that I need to know. Thanks!

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Benjamin replied on 08/09/2018
Manager - Get you MBB offer - Teach taylor case solving, no pre-defined framework - beginners to experts

Hi,

Remember, we are assessing you business skills here, not looking for advanced finance guy. However you will require some basic financial skills that will mostly be used in profitability analysis. No need for advanced financial skills.
The skills that is mostly required is to be able to establish a P&L, and ROI

- Calculate Revenue & Costs

- Integrate investiments in the calculation, using depreciation

Hope this helps

Best
Benjamin

Vlad replied on 08/09/2018
McKinsey / Accenture / Got all BIG3 offers / More than 300 real MBB cases / Harvard Business School

Hi,

I would recommend learning the basic accounting before you start the job, but you will not need that for the interview preparation. Also, the case is a very simplified business situation and the accounting concepts are very often neglected. Here is a list of things you will need to know (and you can google them one by one since it is really short):

  • Profitability calculations (Operating profit, net profit, cost structure, etc)
  • Profit / breakeven formula
  • Interest rates calculations
  • Compound margin
  • NPV using the Rule of 72, Perpetuity
  • CAGR using the Rule of 72

Best!