Scott Tominaga Lists a Few Skills That Financial Analysts Must Have
Financial analysis combines the disciplines of finance and data analysis to aid businesses in generating revenue, along with analyzing the financial performance of a company. Scott Tominaga mentions that a large aspect of working as a financial analyst involves evaluating projects, transactions, investments and businesses to determine whether business entities or assets are profitable and stable in the future.
Scott Tominaga talks about a few skills important for financial analysts
Financial analysts evaluate the financial standing of businesses and try to make sure that the enterprise can maximize its profits. They are usually responsible for identifying business opportunities and evaluating the outcomes of investments. To competently fulfill their responsibilities, financial analysts need to have a unique skill set. Here are some of the most important skills that they need:
- Accounting: Financial analysts must have good accounting skills that allow them to properly read and understand financial reports and statements. These professionals are usually responsible for interpreting diverse types of financial documents like balance sheets and income statements. Hence, they would need good knowledge of accounting techniques and terms.
- Organization: The job of a financial analyst may require them to work with several financial documents at the same time. To effectively do so, they would require good organizational skills. This will help them to competently keep a record of the data collected by them. Organizational skills also help financial analysts to keep a record of diverse numbers and information relevant to their work.
- Financial modeling: Skills in financial modeling are important for financial analysts as they often have to create digital representations of the financial performance of a company. Doing so would involve evaluating the financial records of a company in order to make recommendations for future endeavors. Financial modeling skills help financial analysts to make smart investment decisions on the basis of the performance of a company.
- Technical analysis: Technical analysis would involve predicting future prices by evaluating past prices and trends. This skill helps financial analysts to predict how prices may change over time. They need such skills to make recommendations about potential investments.
- Research: In order to be able to identify and locate appropriate data, financial analysts need research skills. They must have the capability to understand problems, highlight points of investigation and ultimately find the answers to their questions. Carrying out accurate research plays a vital role in enabling these professionals to determine various approaches to a financial issue.
- Communication: As they need to relay crucial information to diverse departments and teams, financial analysts must have good communication skills. These professionals are often responsible for breaking down complex data into simple terms for the purpose of advising companies about their finances. Good communication skills go a long way in making sure that financial analysts are able to effectively discuss their recommendations with different professionals.
In addition to having the skills listed above, Scott Tominaga says that financial analysts must also be good at financial reporting. This would involve the tracking, analyzing and reporting of the income or revenue of a company to examine its financial health. Such skills help financial analysts make informed decisions about how to advise a company about its expenses and investments.