PeopleSoft Financials Interview Questions

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Top PeopleSoft Financials Interview Questions and Answers

1. What is the significance of Auditing according to you?

With Auditing	Without Auditing
The authenticity of all the financial transactions made by different departments of an organization in a specific time period which is generally one financial year can be checked	No track record on the authenticity of the same
Help to make future investment plans	No Future Plans could be considered or accomplished
Help to make and to implement the future expense management solutions easily	Implementation of future expense management solutions cannot be made easily
Reduce the possibility of fraud	Strong chances of fraud in the organization
It makes sure of compliance with statutory regulations as well as with laws	No such benefits could be assured

2. What do you mean by the term inflation?

It is basically a boost in the price and a fall in the purchasing amount of a product or a service.

3. Do you think the statement “A penny earned today would be different from a penny earned in the future” is true?

In terms of financial management, it’s true. It states that there could be uncertainty in generating the same level of profits in the future. The experts should give preference to the present consumption and not to the future. In addition to this, it states that one should pay close attention to all the risks/barriers associated with earning profits in the future. One of the hidden meanings of this statement is “Old methods wouldn’t open new opportunities”

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4. Do you think the tax policies can impact the financial management of a business?

Yes, this is true and many times the financial policies of a business are affected with the same. The tax policies in several parts of the world are not regular and thus, there are several things that make the organizations mold their policies again and again and this could have an impact on the final outcomes.

5. What is financial management reform and what is your opinion on the same?

It is basically the adoption of a new policy in the existing financial management policy. Generally, organizations have to make changes/reforms to the existing policy before the end of the financial year. The reforms are made to improve the outcomes of some sub-tasks related to financial management in an organization. Reforms may or may not always be easy to adopt by the organizations as they have a direct impact on one and all associated with the organization. 

6. As a financial manager, what would be the responsibilities of a professional towards an organization?

One of the key responsibilities of a financial manager is to offer unconditional help to the business in achieving its financial goals. In addition to this, there are various other things for which he/she should be responsible, and the same are listed below.

• The financial managers have to make all important decisions about the capital and financial structure.
• It is their responsibility to cut down the unnecessary expenses so that profits can be boosted
• Planning, as well as the financial analysis, is what they need to perform so that the proper funding to all the activities/tasks could be assured
• All the moral decisions about the investments could be taken by them with appropriate consulting with the management
• Providing any sort of financial advice to higher management is also their responsibility
• Management of financial resources, as well as financial risk management, is also their responsibility.

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7. Can you name any two factors on which a financial management model depends largely on an international market?

This could be the future of currency they are based on and the second could be a Floating Rate of the same.

8. Tell everything which you know about financial accounting and what exactly put it different from financial management?

It is basically an approach in which the true calculation of the assets or the funds is based on the accrual principle. Therefore, it is not to be confused with financial management. In this approach, it is not always necessary that the exact financial conditions of an organization are reflected directly. The organization might have earned profits but in case it is failing to meet the obligations due to reasons such as lack of liquidity, it could be defined as a profit under financial accounting. Financial accounting is purely based on data collection and planning is not of equal importance as in the case of financial management.

9. Tell something about the Desirability Factor?

It is basically an approach to comparing the different financial management cash proposals. For a proposal to be successful, it must have a value of more than one on the index. 

10. Define the term “Time Value of Money”

It simply means the difference in the value of money presently and the value of the same amount of money in the future. It is actually a term that indicates to the financial experts that they shouldn’t stick to policies that are meant to generate the same amount of profits again and again. Its prime motive is to let the experts know that the penny received by an organization in the present time could be different in the future. 

11. What sort of financial problems does an organization face?

1. The first one is the inflation
2. Decrease in demand for products/services
3. Fewer sales due to not targeting the niche customers
4. Lack of funds due to misuse or overinvestment
5. Improper management of different departments
6. Bankruptcy
7. More expenses than earnings 
8. The tax policies
9. Less return on the investments
10. Non-payments by the vendors

12. What are some of the disadvantages of the Financial Ratios according to you?

• The product lines are not as diverse as they have to be
• Sometimes the Financial data in this approach get distorted very badly
• The accounting policies largely vary and this can have a very large impact on future results.

13. Define the term weighted average cost of the capital?

It is actually the weight-age of the costs of different funds source within an organization

14. Give abbreviation of NOI and WACC

NOI - It stands for the Net Operating Income
WACC - Weight Average Cost of Capital

15. According to you, what is cheaper between equity and debt? Give support to your answer?

The debt is actually cheaper in most cases. This is because it is often paid prior to the equity debt and it has collateral backing as well. When it comes to liquidity the debts rank above the equity in most cases. Also, it must be kept in mind that depending on the business models, current situations, and pros and cons of both, the equity could also be cheaper.

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16. What makes a good financial model according to you?

The prime requirement for this is having solid modeling fundamentals. All the assumptions of the models should remain under one roof for better understanding. The model should be based on the past experiences of the organization in financial management. They must specify to the users how well the inputs are transformed into the outcomes. The cash flow calculations should be free from errors in the model and it must have the ability to display all the outputs to the authorized users. 

17. What do you understand about the working capital?

It is basically defined as the present assets and their net worth of an organization including the information on the liabilities.

18. What are the benefits that organizations can derive in financial management by merging/collaborating with each other?

Merging or collaboration has several benefits in the present time in generating profits. The fact is modern-day business models need multiple specializations from the managers. It is true that even after making a ton of sincere efforts, achieving multi-specialty is not easy for the benefits. The biggest benefit is businesses if merge or collaborate can simply avoid this problem. They can have access to the technologies of one another and this can help to save a significant cost over the long run. Risks associated with entering the new markets can be avoided. 

19. Tell anyone the difference between the Business and the financial risk?

Business risks are generally unavoidable. However, with proper planning, financial risks can be avoided. 

20. What is a conditional loan?

It is basically a loan that is to be repaid by the borrower in the form of royalty and not the money. It is when the organization or business generates sales or profits on the venture provided by a third party or another organization.

21. What exactly are the benefits of using financial management software in an organization according to you?

Well, the modern day's software is good enough to be trusted and many organizations are there which are known to develop some of the best ones. They come with a full bouquet of benefits if one known how to use them properly. A few of the top advantages they offer are:

• Businesses can simply make sure of automation of various manual process related to the management of finance
• A lot of improvements can be assured in the outcomes
• Auditing can be made very simple and reliable
• They have a lot of benefits in enabling the organization to assure the effectiveness and efficiency
• The decision-makers can simply make sure of a tool that is good enough to be trusted when it comes to accountability
• All the process related to accounting can be centralized or decentralized anytime if the need for the same is felt

22. What is an Income Note?

It is a common method of venture capital financing in which the borrowers remain liable to pay the loyalty, as well as the interest in the profits or on the sales.

23. What do you mean by the term debt securitization? Name any one function in which it is categorized

It is basically a common method of debt recycling and the function in which it can be categorized can be the pooling function?

24. What exactly is the payback period?

It is basically the time taken to completely recover the actual investment from the cash flow of the concerned project. It can also be defined as the Break Even Period in financial management. 

25. How well you can define the term profit maximization in financial management?

It is often confused as the true goal of financial management policy. However, it’s not always necessary in all cases. This couldn’t be the final target in most of the financial management policies. In fact, it can be defined as the short-term objective in financial management. Therefore, it is considered a limited objective. It is necessary for organizations to make efforts towards this after realizing all the risks.

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26. What are the five major functions of the finance department in a business?

These are:

1. Managing the currency
2. Cash Flow management
3. Funds Management
4. Performing banking-related activities and tasks
5. Corporate financing

27. What do you mean by the term Convexity?

It is basically defined as the measure of curvature that largely exists among the various yields related to a bond and the bond prices.

28. What is a deferred tax asset and what could be the motive of an organization considering the same?

It is basically a situation that arrives when a business pays more in tax to the IRS than what exactly is shown as liabilities and expenses on the statement of their income in a specific time period. The different organizations can have different visions and thus it is not always necessary that the motive behind this could be the same for all the organizations.

29. Name the funds that actually belong to the shareholders but can actually help an organization in boosting its net worth?

These are Ploughing Funds.

30. In people soft can we delete the online page?

Yes, we can delete the online page.