FTI Consulting - Restructuring Flashcards
FTI Behavioral Questions:
- Tell me about yourself.
- Why FTI?
- Why is a career in consulting a good fit for you?
- Where are you from?
- Why SMU?
- Where do you look for financial research?
- How can you add value?
- Tell me about a deal you’ve read about recently.
- Are you willing to travel?/ How do you feel about traveling for work on a weekly basis?
- What do you know about FTI?
- What questions do you have for us?
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FTI Technical Questions:
• Talk about how you have used excel in your job and at school. What is your favorite short cut? What is your favorite formula? What is your favorite Excel command?
- Walk me through a DCF.
- How do you calculate Free Cash Flow?
- If you project out five years in your DCF model, do you place the terminal value in year 5 or 6? Why?
- What is WACC?
- What is beta?
- What is the terminal value?
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• How would you determine the value of a company?/ What are the three ways to value a company? Talk about pros and cons with each valuation method.
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• How would a capital expenditure impact the three financial statements?
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• What sources would you use to determine if a company was distressed? / What ratios would you look at to see if a company is distressed?
- Debt/Equity
- Debt Service Obligation
- Current Ratio
- What is EBITDA and why is it important?
- How do you find a discount rate for valuing a company?
- What is the difference in calculating levered FCF and unlevered FCF. What is the discount rate you should use with each of them?
- What assumption on a DCF gives you the most trouble?
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• Explain what a revolver is.
• A revolver is a borrower who carries a balance from month to month through a revolving credit line. With a revolving line of credit the borrower is only obligated to make monthly payments and therefore regularly holds a revolving credit balance on their account over time. A revolver is typically a major source of income for credit issuers since they have an open-ended credit line with steady monthly payments that include interest and principal.
• If you find “extra” cash for a company, what happens to Enterprise Value? What happens to Equity Value?
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- Explain how the 3 financial statements are related.
- What happens to the three statements when you add $100 of depreciation with a 40% tax rate?
- Walk through an example that involves all 3 financial statements i.e. how does the purchase of $10 of inventory impact all 3 statements.
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• If you could have only two of the financial statements, which would you choose? Why?
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• Explain the difference between direct and indirect accounting on the cash flow statement.
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• Explain what a 13-week cash flow model is.
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• List all the finance and accounting classes you’ve had and your grades in each of them.
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• How does the DCF change for an E and P Project?
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• What is the difference between Prepaid Expense and Accruals?
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