How to Become an FP&A Analyst

Summary

In this video, we explore the role of an FP&A (Financial Planning & Analysis) analyst, including responsibilities, salary expectations, and required skills. We highlight the importance of budgeting, forecasting, and strategic planning, with insights drawn from 820 job postings. Key skills such as Excel proficiency, financial analysis, and experience with ERP systems like SAP and Oracle are essential. We also discuss the potential career growth, including paths to finance manager or CFO. Additionally, we touch on educational requirements and certifications like CPA and CFA, providing a comprehensive guide for aspiring FP&A analysts.

Takeaways

• 😀 FP&A analysts play a vital role in managing a company's budgeting and forecasting activities to align resources with organizational goals.
• 😀 The main focus of an FP&A analyst is to create budgets, update forecasts, and assist in strategic decision-making by providing financial insights.
• 😀 There are two types of FP&A analysts: Strategic, who focus on long-term planning, and Operational, who manage updates to forecasts and daily planning.
• 😀 FP&A analysts can specialize in areas like forecasting sales revenue, managing costs, or handling investments and balance sheet expenditures.
• 😀 The average salary for an entry-level FP&A analyst is $88,000, with senior analysts earning $120,000+ annually after 4-6 years of experience.
• 😀 A bachelor's degree is required for 42% of FP&A roles, while 33% require a master's degree. Some positions (9%) do not specify a degree requirement.
• 😀 Excel proficiency is essential, with 90% of FP&A roles requiring solid Excel skills. Additional skills in forecasting, budgeting, and financial reporting are also highly sought after.
• 😀 Professional finance certifications like CPA (17%), Certified Corporate FP&A Professional (11%), and CFA (7%) add value in the job market for FP&A analysts.
• 😀 Expertise in tools like Hyperion, Anaplan, Workday, SQL, Power BI, and Tableau is increasingly desirable, especially for larger companies.
• 😀 Larger organizations often require FP&A analysts to have experience with ERP systems such as SAP (16%) and Oracle (11%) for more complex financial operations.

Q & A

What is the primary responsibility of an FP&A analyst?

An FP&A analyst is responsible for managing a company's budgeting and forecasting activities. This involves setting financial goals for the company and refining predictions based on new data throughout the year.

What is the difference between Strategic and Operational FP&A analysts?

Strategic FP&A analysts focus on long-term planning, while Operational FP&A analysts manage daily updates to forecasts and budgets. Both play critical roles in ensuring the company’s financial goals are met.

How does an FP&A analyst help with forecasting and budgeting?

FP&A analysts help create and refine financial forecasts and budgets. Budgets set financial goals, and forecasts provide updated predictions based on real-time data, helping organizations adjust their financial plans as needed.

What salary can an entry-level FP&A analyst expect to earn?

An entry-level FP&A analyst can expect to earn an average salary of around $88,000 annually, with opportunities for higher earnings as their experience grows.

What are the potential career advancements for an FP&A analyst?

An FP&A analyst can advance to roles such as finance manager and even CFO with increased experience and expertise in financial analysis and management.

Is a university degree required to become an FP&A analyst?

While a university degree is not always a strict requirement, most job postings (42%) ask for at least a bachelor's degree. However, 9% of listings do not specify a degree, suggesting that experience and skills can sometimes substitute for formal education.

What are the most important technical skills required for an FP&A analyst?

The most important technical skills for an FP&A analyst include proficiency in Excel (required by 90% of job postings), as well as expertise in forecasting, budgeting, cost analysis, variance analysis, and financial modeling. Knowledge of data analysis tools like Power BI and Tableau is also valuable.

What certifications can enhance an FP&A analyst's qualifications?

Certifications such as CPA (Certified Public Accountant), CFA (Chartered Financial Analyst), and the Certified Corporate FP&A Professional are valued by employers and can enhance an FP&A analyst's job prospects.

How important is experience with ERP systems for an FP&A analyst?

Experience with ERP systems is highly important, particularly in larger companies. More than 30% of job listings mention proficiency with ERP systems like SAP and Oracle, especially in larger organizations.

What software tools are commonly used by FP&A analysts?

FP&A analysts commonly use software tools like Hyperion, Anaplan, and Workday for financial analysis. Additionally, expertise in data management tools like SQL, Power BI, and Tableau is often required.