Why You Need to Ask These 21 Accounting Interview Questions

By Robert Half on May 1, 2020 at 2:00pm

The hiring process for accounting roles is more challenging than it has been in the past. The candidate pool may not be as tight, but now you need to locate, interview and hire skilled talent remotely. You’ll also find that current circumstances mean some of the accounting interview questions and answers you need to consider are different, too.

In the not-too-distant past, you would have considered whether a job candidate would complement the office culture. Today, you have to gauge how effective they’ll be working from home (more on that topic later in this post). And the questions you use to assess a candidate’s technical knowledge and abilities — and get a general sense of their soft skills — have to go just as deep as they ever did. In this challenging economy, you can’t afford to make a bad hire.

Here are 21 accounting interview questions you should consider asking your top candidates to cover their skills, experience and suitability for remote work.

1. What is the difference between accounts receivable (AR) and accounts payable (AP)?

When you’re interviewing entry-level job candidates for bookkeeping or accounting clerk openings, you want to test for basic skills. Questions like this one will reveal whether potential hires understand accounting fundamentals.

2. When a company is using double-entry accounting, what elements of a given ledger must be equal?

This is another relatively simple question. Job candidates with some accounting training or experience should have no trouble with their answer. As with the question above, how applicants reply will show whether they’re ready for an entry-level job at your company.

3. What are two or three types of special journals?

This is another basic question, but you could also present a few journal samples for the applicant to read and explain as a skills test. How a candidate responds will help reveal their ability in identifying mistakes or omissions.

4. If a company has three bank accounts for processing payments, what is the minimum number of ledgers it needs?

Use this question to explore a candidate’s knowledge of ledgers and as a launch pad for further discussion of skills related to the available position. A good response will reveal that the applicant has thought through how accounts relate to lines of business and generally accepted accounting principles (GAAP).

5. What methods have you used for estimating bad debt?

Accounting interview questions like this one can help bring to light how the applicant has approached a routine process with previous employers. For recent grads, this line of inquiry allows them to apply theoretical knowledge in venturing educated guesses, which could open a dialogue about how your company handles this issue.

6. Why is it easier for someone to perpetrate fraud using a journal entry than with a ledger?

Accounting professionals, particularly those who have managed ledgers or had jobs as full-charge bookkeepers for more than a couple of years, should be able to speculate on this scenario. A candidate with more formal training specific to auditing or fraud analysis will likely explain this thoroughly and be able to provide examples.

7. Which enterprise resource planning (ERP) systems have you used?

Most professionals, especially those with experience working for medium to large organizations, will have some experience with Hyperion, Microsoft Dynamics GP, Oracle Enterprise Manager or other ERP system. Discussion of these tools, how the applicants learned them and put them to work, and what applications your company uses will reveal how much, if any, training might be needed. (For entry-level candidates, you might turn this into a discussion of future training possibilities.)

8. What is your experience with developing business metrics?

This question can help you evaluate entry-level business or financial analyst candidates all the way up to midcareer professionals who aspire to roles that come with budget and staff oversight responsibilities.

9. If a private company with break-even operations received a $10 million investment, how would you develop a strategy to spend or invest that money?

This is an example of a situational interview question. Here, you’d be gauging an applicant’s ability to think through a scenario like one that might be faced in a more senior finance role.

10. What challenges have you faced in leading a team through an analysis project?

As with the previous interview question, the answers to this inquiry will give you a hint as to the candidate’s critical thinking skills. It will also elicit a better picture of their leadership potential.

11. What do you consider the top three skills of a great accountant?

You want to hire someone with numerical abilities, but not necessarily a mathematician. You also need someone with analytical know-how and who can communicate effectively with others. Look for responses that show a recognition of the importance of general business knowledge, technology expertise, customer service orientation and specialized experience that might apply to the role.

12. Can you give me an example of how you would explain a complex accounting process or finance data to someone in HR, tech support or another team?

Here’s where you’ll learn about a candidate’s communication skills. Look for an ability to simplify and present information to people who may not speak the language of “FIFO” (First In First Out, a method of valuing inventory) or “EBITDA margins” (Earnings Before Interest, Taxes, Depreciation and Amortization).

13. When you buy a piece of equipment for a company, what is the impact on the three financial statements?

This is another basic accounting question that lets you assess a potential hire’s understanding of cash flow statements, balance sheets and income statements. Before they reply, the best interviewees will have threshold questions for you, such as, should they answer for the time of acquisition or for some time in the future, and how is the equipment financed?

14. How do you define big data, and why is it important for accounting teams to have expertise in it?

You may not need big data experts right now, but hiring someone who has knowledge of data retrieval, interpretation and analysis will be useful down the line when you decide to build up your team’s skills and expertise in this area.

15. Describe a time when you’ve made an accounting error and how you handled it.

Rather than making a judgment on the mistake, look for the lessons learned. Did the candidate take responsibility for the error? How did they manage the situation? Were they proactive in making things right?

16. How do you minimize the risk for error in your work?

This is the second part of the previous question. The best responses will shed light on the candidate’s process for reviewing their work and minimizing miscalculations.

17. How do you differentiate between auditing and accounting?

If you’re interviewing recent graduates, you’re looking to see how well they paid attention in class, rather than a deep level of expertise. Look for an ability to explain the fundamentals of key roles and processes in finance and accounting.

18. What accounting software are you most familiar with?

While it may be ideal to find expertise in the same accounting programs you use at your company — Excel, Hyperion, IBM Cognos, QuickBooks, ERP and so on — it’s even more valuable to find someone who is software savvy and able to get up to speed with a variety of programs.

Some companies have embraced cloud financial solutions, and while experience in online-based software and services is valuable, the ability to get comfortable with the new technologies is worthwhile, too. And, of course, the ability to work effectively with, or quickly learn, collaboration tools is a big plus, particularly in remote work environments.

19. What criteria do you use to assess the reliability of the financial information you receive?

Look for answers that show high performance standards. Perhaps the candidate has designed methods to check for bookkeeping errors or quality control in the data entry process. What you’re looking for are answers that help you evaluate attention to detail and accuracy.

20. What do you think of recent updates in the accounting standards?

Unlike questions that probe problem-solving abilities or relevant skills, this one explores knowledge of current industry practices. Have they had training in new tax changes? Their responses will help you determine their commitment to the profession they’ve chosen and their ability to express themselves.

21. What are the three attributes that make you an effective remote worker? And what are the greatest challenges of working off-site?

Remote workers must be self-starters and work with little supervision. They need strong communication skills, and they have to be comfortable with your team’s technology (or show they can quickly pick it up). This is an important consideration since working from home has become the new normal. Make sure that your candidate will be both productive and comfortable working remotely. And don’t kid yourself — this is nothing to take for granted. Yes, many people might thrive working off-site. But for many others, even high performers, the home just isn’t an ideal work environment.

Once you’re comfortable with their remote readiness and get through all the accounting interview questions and answers, reflect on what you’ve learned about the candidate’s soft skills. Do you have a good sense of the potential hire’s level of empathy, tact and diplomacy, for example? What about their verbal skills? Even if you interviewed the candidate by video, you should have an impression of their personality and their ability to express themselves.

Consider, too, today’s unpredictable work environment. Of all the hard and soft skills you interview for, adaptability and a willingness to embrace new challenges may be two of the most critical ingredients for an accounting professional’s success.

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