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"Financial Analyst" Positions at F500 = Accounting?

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"Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 13 Nov 2010, 20:39
Hi,

Is it true that most financial analyst jobs at F500 companies are mostly glorified accounting positions? I've heard a lot of people in the industry say this, but if its true, why do they hire finance majors then? Shouldn't they just get people with accounting degrees? Also, is there still a decent amount of NPV, IRR, etc. modeling or is most of the stuff truly just internal auditing/account reconciliation type of work?
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 17 Nov 2010, 14:20
It really depends what group you're with, but for the most part most financial analysts spend a lot of their time doing work that could be considered "accounting". If you're in the treasurers or M&A group you may do more finance-related stuff, but the more complicated finance work tends to be done by people a few grades higher than analyst.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 23 Nov 2010, 20:53
Internal auditing is done by internal auditors. Reconciliation and posting are done by accountants. Analysts analyze and project based on postings accountants have made, but they still need to know accounting pretty well in order to understand what is going on as they are dealing with accounting information. If that means that they are glorified accountants, yes, they are. The same argument goes for investment banking analysts/associates - the author of Mergers & Inquisitions, who is an ex-IB himself, argues that IB is glorified accounting and I tend to agree with him. The difference is that at some point in IB your job becomes more client-oriented. In most corpfin related jobs you spend a great deal of time reading accounting statements and trying to figure out what the accountants have done. Unless you are in a job that is very close to markets and/or is very high-level quant finance, you could classify all finance-related jobs as accounting-related. If you don't like accounting at all, I would not go for corpfin, neither in industry, nor in IB.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 27 Nov 2010, 18:40
Its not that I dislike accounting completely, its just that I want to be more on a decision-making role rather than just a recording transactions role, which is what most accounting jobs seem like. Even if a job is 75% accounting and 25% decision-making, I'd be fine with it because its not just accounting with no decision-making whatsoever.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 28 Nov 2010, 07:45
If you work in corporate finance in industry, you won't be recording transactions as you won't be an accountant, but you'll still be dealing with accounting info. This is also true for IB. Wherever you go, you won't be handed decision making responsibilities right away. All entry-level jobs are processing/execution jobs - you just do what someone else has told you to. In consulting you gather and analyze data and put together PPTs, in corpfin you analyze data and project trends, in IB you process data in order to create models and pitchbooks. In most cases, you will need at least several years before you are put into a decision-making role. Just find a career that you think you will like and stick it to it for several years - if you are good, you will be given more responsibilites with time.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 29 Nov 2010, 13:40
it really depends on the company and the leader of your function. some companies require all their FAs to have CPAs, so naturally it'll be accounting heavy. some companies don't require it and bring in people of different backgrounds (i.e. consulting, IB). those kinds of jobs will require you to learn about accounting on the job, but they'll be more finance/strategy focus.

in general, all finance jobs require to a degree a comfort level with accounting basics. if you don't want to feel like you have the label pinned to your back, then make sure the group you're in doesn't have a lot of CPAs.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 30 Nov 2010, 15:25
Depends on the group you're in, such as M&A or Treasury.

If you're in "finance", the majority of time you deal with accounting transactions. However, I have heard pure accounting functions are getting outsourced at some of the bigger companies.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 04 Dec 2010, 11:09
sniperssk wrote:
If you work in corporate finance in industry, you won't be recording transactions as you won't be an accountant, but you'll still be dealing with accounting info. This is also true for IB. Wherever you go, you won't be handed decision making responsibilities right away. All entry-level jobs are processing/execution jobs - you just do what someone else has told you to. In consulting you gather and analyze data and put together PPTs, in corpfin you analyze data and project trends, in IB you process data in order to create models and pitchbooks. In most cases, you will need at least several years before you are put into a decision-making role. Just find a career that you think you will like and stick it to it for several years - if you are good, you will be given more responsibilites with time.


You make an excellent point about all entry level jobs being bitch work mostly and I guess I'll have to suck it up for 2-5 years and just do it. I just wanted to make sure that for corporate finance I won't just be a pseudo-accountant for the rest of my life. I know that entry level will probably be a lot of accounts reconciliation, closing entries, data gathering, etc. but I just wanted to make sure that this doesn't keep happening at the senior levels and at the senior levels you start doing more decision-making, modeling, etc. Has anyone on these boards worked at more senior levels within a company and can comment on what, for example, a VP of Finance, Director of Finance, etc. does typically? Basically, for people who come in after an MBA as a financial analyst for a company, what would they do?
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 07 Dec 2010, 15:18
hailtothevictors wrote:
sniperssk wrote:
If you work in corporate finance in industry, you won't be recording transactions as you won't be an accountant, but you'll still be dealing with accounting info. This is also true for IB. Wherever you go, you won't be handed decision making responsibilities right away. All entry-level jobs are processing/execution jobs - you just do what someone else has told you to. In consulting you gather and analyze data and put together PPTs, in corpfin you analyze data and project trends, in IB you process data in order to create models and pitchbooks. In most cases, you will need at least several years before you are put into a decision-making role. Just find a career that you think you will like and stick it to it for several years - if you are good, you will be given more responsibilites with time.


You make an excellent point about all entry level jobs being bitch work mostly and I guess I'll have to suck it up for 2-5 years and just do it. I just wanted to make sure that for corporate finance I won't just be a pseudo-accountant for the rest of my life. I know that entry level will probably be a lot of accounts reconciliation, closing entries, data gathering, etc. but I just wanted to make sure that this doesn't keep happening at the senior levels and at the senior levels you start doing more decision-making, modeling, etc. Has anyone on these boards worked at more senior levels within a company and can comment on what, for example, a VP of Finance, Director of Finance, etc. does typically? Basically, for people who come in after an MBA as a financial analyst for a company, what would they do?


Look, it depends on several things. First, which function in finance you are actually in - treasury, corporate development, planning, etc. I really doubt that you will be closing entries and reconcile accounts at the MBA level - nobody would pay you 100-120k to do something that someone else would do for 50k. Besides, that job is for accountants. Accounting is about writing the story of what happened, finance is about telling why it happened and what will most likely happen in the future. Of course, doing analyses and projections in finance will require you to delve deeper into accounting data in order to understand what happened, but you will not be required to make accounting entries. You will need to understand how entries are made and you cannot escape understanding accounting in finance, but you will be hired for jobs that require more coordination and project management than something that a clerk with no college degree could do. Second, what you will exactly do will depend on the company and how it has organized its finance function and its finance program, if they have one. You might be rotated across jobs every 2-3 years in order to understand the business, but that varies by company, so there's no definitive answer. As for what exactly you would do as a financial analyst after an MBA, I think it would be something that uses your coordination and communication skills in addition to your analytical skills. The basic stuff is to be given a problem, gather data (you cannot escape that thing in any job), analyze it, present it in PPT to some of your managers, make recommendations for solutions, coordinate the process as you will need to interface with different people to get things done. For example, you might be asked to measure the profitability of certain investments or do an analysis on a competitor. As you progress, you will be given the responsibility to manage not only processes, but also supervise people who in turn manage processes - that's what managers and VPs do.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 09 Dec 2010, 23:41
I see thanks for the reply. I have one more question: if corp development or budgeting/forecasting is the ultimate goal, would a CFA be of any help? I've heard its not that useful outside of portfolio management and maybe treasury positions, but will it carry any weight for the corporate finance positions I desire?
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 12 Dec 2010, 08:23
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hailtothevictors wrote:
I see thanks for the reply. I have one more question: if corp development or budgeting/forecasting is the ultimate goal, would a CFA be of any help? I've heard its not that useful outside of portfolio management and maybe treasury positions, but will it carry any weight for the corporate finance positions I desire?


Corp development is basically M&A and CFA would not be very useful for that. It would be even less useful for budgeting and forecasting as this job does not focus so much on the markets, but rather on the internal processes in each of the company's divisions while making some assumptions on how the external environment will develop. You don't need a CFA for this. The only benefit I could think of that CFA would represent for these positions would be showing that you know something about finance and you have taken steps to boost your knowledge if you are from a non-finance background. A piece of advice: don't set your ultimate goal yet as you don't know what you will like about finance. Most companies will let you rotate through assignments in different finance areas at the MBA level so you can both learn how the finance function operates and figure out what you are interested in. But even then, corporate career paths are not linear and 10 years from now you could end up in a position you haven't thought of. Once you get in and build your network, there are really no hard rules how you will move from one position to another, it's all about showing competence/potential and being friends with the right people.
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Re: "Financial Analyst" Positions at F500 = Accounting? [#permalink] New post 25 Dec 2010, 18:22
From having been in corp fin at a f500, it is honestly very varied and depends on the group/reporting structure tremendously.
I had friends at the same place who were essentially really sophisticated accountants and some who were shaping pricing/brand strategies and some who were in-between. Especially in F500, fit with immediate team is significant and I fear that most people do not realize the importance of this - try to gauge if your manager/direct boss is ambitious, or on a coasting mode, is he a good teacher who will give you learning room or a micro-manager.

Out of undergrad, I would, after getting a offer, ask to speak to my direct manager and chat with him honestly about his learning style, approach to work, deadlines, etc. (reverse interview). It is only fair since you are committing years of your life to this.
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Re: "Financial Analyst" Positions at F500 = Accounting?   [#permalink] 25 Dec 2010, 18:22
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