Pursuing Corporate Finance Professionally - dummies

Pursuing Corporate Finance Professionally

Part of Corporate Finance For Dummies Cheat Sheet (UK Edition)

After you decide that a career in corporate finance is absolutely your life’s calling, you next need to get to grips with some essential mathematical and computer skills that not everyone warns you about when you first embark on your journey in corporate finance.

Whether you’re pursuing a college degree or a professional qualification, these skills tend to be sorely neglected, leaving many people completely unprepared for what they’re going to face in the workplace. Going to college can give you the research and problem-solving skills you need, but it doesn’t necessarily give you the specific applied skills needed for the market. You need to supplement your education with on-the-job experience or an apprenticeship under an experienced professional. You won’t regret it!

Maths skills for a job in corporate finance

Corporate finance uses, more than anything else, a lot of maths. The majority of it is quite simple, but it’s still maths, and so corporate finance is particularly ideal for the numerically inclined. Specifically, you need to be good at the following:

  • Arithmetic: You’re going to use addition, subtraction, multiplication and division constantly.

  • Algebra: You need to be able to find x, because the job requires you to do so frequently.

  • Calculus: You see calculus less frequently than the other fields, but it’s a crucial component in maximisation and optimisation equations, plus many forecasting analyses. In other words, you need calculus if you plan to become a corporate finance analyst.

  • Statistics and probability: Be certain that you know this stuff – the maths of uncertainty – if you want to analyse investments or risk. You don’t see statistics and probability in entry-level jobs, but you definitely need them as you move up the ladder.

Computer skills in the financial field

Even if you become the best mathematician in the world, unless you have some specific computer skills, you’re still useless in the field of corporate finance. The reason is simply that the amount of data that has to be recorded, processed and communicated is absolutely massive. You can keep track of all this data with pen and paper, but it takes a huge amount of time. As a result, pretty much every finance job on the planet requires you to have a minimum amount of specific computer skills.

You need to know how to use all the following:

  • Any form of e-mail

  • Any Internet browser

  • Microsoft PowerPoint

  • Microsoft Word

You also need to be proficient with at least one software package of the following types:

  • Accountancy software (Sage, QuickBooks, VT, Xero)

  • Financial management software (JD Edwards, Hyperion, Quantrix)

  • Data analysis software (SPSS, SAS, Microsoft Excel)

  • Database software (MySQL, Access, Oracle)