Get Active in Our Amazing Community of Over 454,000 Peers!

Schedule mock interviews on the Meeting Board, join the latest community discussions in our Consulting Q&A and find like-minded Case Partners to connect and practice with!

Seeking Guidance to Strengthen Understanding of Accounting Concepts

accounting Math problem qualitative analysis
Edited on Apr 10, 2024
5 Answers
172 Views
Anonymous A asked on Mar 25, 2024

Hello

I'm currently facing challenges with quantitative problems, particularly in understanding various accounting concepts such as the NPV formula, depreciation methods, breakeven analysis, and more. While I've learned the formulas using the Darden Casebook, I've realized there's much more nuance in real-world applications. For example, yesterday I was asked to calculate depreciation but wasn't aware whether it followed a straight-line method or another approach.

Could you please provide guidance on how I can deepen my understanding of these concepts and their practical applications?

Thank you.

(edited)

Overview of answers

Upvotes
  • Upvotes
  • Date ascending
  • Date descending
Best answer
Cristian
Expert
Content Creator
replied on Mar 25, 2024
#1 rated MBB & McKinsey Coach

You don't need a granular understanding of accounting concepts to pass consulting interviews (assuming that's your target). 

Actually, I put together all the terms you need to know in this article (based on all the interviews my candidates have had recently):

I would be very, very surprised if you get a question that doesn't relate to the ones in this list. 

And if you do, don't hesitate to ask the interviewer for the formula. You are not tested for your knowledge (unless you are applying for an expert role), but for your skills. 

Best,
Cristian

Was this answer helpful?
Pedro
Expert
updated an answer on Mar 25, 2024
Bain | Roland Berger | EY-Parthenon | Mentoring Approach | 30% off first 10 sessions in May| Market Sizing | DARDEN MBA

Here's what you need to do in order to be prepared:

  • Keep doing cases. If there's a relevant concept, it will show up in a practice case. If you do a good ammount of cases, you'll get them all covered. To be honest, “practice” cases have many more “accounting” concepts than real cases. I don't know of anyone who asks for an NPV calculation, for example (but understanding the “time value of money” and risk-reward concept is tested occasionally).
  • If during the interview they ask for something you don't know… just ask what the concept is, and do your calculations based on that. 

P.S. I am a Darden alumn, and because of that I know particularly well the Darden MBA Case Book… it does a good job covering the concepts you may need to know.

(edited)

Was this answer helpful?
Anonymous A on Mar 25, 2024

Hey Thankyouu. Right now, I am doing cases from Darden Casebook and yes it's pretty good

Hagen
Expert
Content Creator
updated an answer on Apr 10, 2024
#1 Bain coach | >95% success rate | interviewer for 8+ years | mentor and coach for 7+ years

Hi there,

I would be happy to share my thoughts on your situation:

  • First of all, in order to succeed in strategy consulting interviews, you really do not need to know the depths of accounting.
  • Moreover, however, I would highly advise you to be proficient in the majority of concepts listed in PrepLounge's Case Interview Basics in section “Useful Business Analysis Tools”.

If you would like a more detailed discussion on how to best prepare for your upcoming interviews, please don't hesitate to contact me directly.

Best,

Hagen

 

You can find the DACH consulting salaries report 2024 here!

(edited)

Was this answer helpful?
Benjamin
Expert
Content Creator
replied on Mar 31, 2024
Ex-BCG Principal | 8+ years consulting experience in SEA | BCG top interviewer & top performer

Hi,

The consulting interview is NOT a test of your content knowledge, and a good interviewer will design a case that tests your ability to think, not to regurgitate a known formula. 

Especially if you are an undergraduate - there is zero expectations for you to know something like NPV. 

Please focus instead on the core skills and abilities - of which accounting is not included. 

I speak from experience as I was a History major :)

For more perspective on why you don't need accounting knowledge, you can check out my article: 

Breaking Into Consulting with a Liberal Arts Background

Was this answer helpful?
Ian
Expert
Content Creator
replied on Mar 26, 2024
#1 BCG coach | MBB | Tier 2 | Digital, Tech, Platinion | 100% personal success rate (8/8) | 95% candidate success rate

Hi there,

Well, if you already understand that depreciation could either be straight-line or an alternate method, you're doing in right!

In general, as long as you have the following down, you should be ok:

  1. ROI
  2. Margin
  3. Markup
  4. % Change
  5. NPV (annuity + perpetuity)
  6. Breakeven (many scenarios)

Google is your friend, and practice with casebooks + peers!

Was this answer helpful?
Cristian gave the best answer

Cristian

Content Creator
#1 rated MBB & McKinsey Coach
700
Meetings
30,379
Q&A Upvotes
130
Awards
5.0
218 Reviews
How likely are you to recommend us to a friend or fellow student?
0 = Not likely
10 = Very likely
You are a true consultant! Thank you for consulting us on how to make PrepLounge even better!