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How to Test a Candidate’s Advanced Excel Skills

Featured Best Practice on Integrated Financial Model

Excel workbook
Financial model presenting a business scenario of a corporation engaged in granting loans from its own capital funds or from funds sourced by investors. The model can be fully modified and applied to any type of lending company and its main purpose is to enable users to get into details of every [read more]

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In this day and age where most workflows are automated, employees must have basic computer skills to keep up. No matter the size, company job vacancy announcements should include computer literacy as a must-have for applicants.

For instance, basic knowledge may be enough for entry-level positions such as assistants, while project managers and reporting officers will likely need mid-level expertise. Meanwhile, more complex functions such as accountants or financial analysts require advanced Microsoft (MS) Excel skills to ensure proper business monitoring.

It’s crucial to find out more about a candidate’s strengths during the screening process. Besides the interview, a practical test like this advanced Excel test must be administered to ensure you’re getting top talents for your company. If you’re giving out the evaluation yourself, consider the following points.

5 Excel Problem-Solving Functions to Evaluate

The mastery of the Excel application would require formal training and years of practice. That’s because using advanced Excel functions requires familiarity with functions and formulas and careful analysis of models and data. The user must know the proper commands, the data to be processed, and the desired results to manipulate the program according to specific business objectives.

To test for advanced proficiency, companies may set different metrics. Headhunters can use these indicators to identify candidates with high-level Excel skills.

1. Using Advanced Formulas and Creating Meaningful Charts

Basic knowledge of Excel would allow users to create basic comparison charts. However, this is not enough for positions needing data analysis and research. For more complex sheets, for instance, showing discounted cash flow template, projected income, and other data analytics, the user must know how to use and present a histogram or similar charts.

To create one, the candidate must know how to make Excel work for them by using more advanced formulas. Instead of the usual SUM, PRODUCT, and AVERAGE computations, more advanced procedures such as the proper uses of IFERROR with VLOOKUP, SUMPRODUCT IF, COUNTIF, and other complex calculations must be included in the problem.

2. Tapping Data Simulations and Solver

Data simulation works in the same principle as machine learning. In order to function correctly and solve a problem, it has to have solid data input. With the right data and ‘command’ or mathematical formula, it can calculate projections or any results your business wishes to know.

Excel’s simulation feature is helpful for businesses looking to create financial projections and other forecasts, or planning budgets and expenses. On the other hand, Solver is another intricate Excel add-on used in data analysis. It shows a range of values for a formula in a single cell based on restrictions associated with the values of other cells reflected on a worksheet.

Enterprises can use this feature in comparing projected earnings versus varied spending amounts in marketing a product. Business analysts and accountants must be tech-savvy and possess these advanced Excel skills to help executives make data-driven decisions.

3. Proficiency in Power Query and Power Pivot

This highly valuable business tool enables users to quickly manipulate and analyze data from multiple sources. A candidate must be able to use it properly to access and get the correct data from several worksheets based on a specific data model. Additionally, they must analyze them and create insights that aim to resolve a particular problem.

Power Pivot works complementary to Power Query, the first step in data gathering. With the latter, candidates can import data from multiple sources and format it into Excel. Depending on the test requirements, the user can then remove unnecessary data or merge cell entries using the former.

4. Visual Basic for Applications (VBA)

Visual Basic for Application is a programming code generated from macro recording. Jobs that require data analysis will find this highly useful in processing numerous data. Learning this skill would require familiarity with the different formulas, as the results can be skewed if the user doesn’t know how to use it.

VBA can generate different types of results based on your needs. For instance, financial analysts and investors can cull complex functions from the program, including financial ratios, sales, income forecasts, pricing, and risk management information.

5. Making Conditional Formatting Rules

To highlight the salient points in a worksheet, users may apply different formatting styles, for instance, using different colors and data bars, and placing icons on a few cells. These can be very helpful when dealing with complex formulas, making spreadsheets simpler and easier to work on.

Conditional formatting rules simplify complex data processing, and the candidate must know how to use advanced formatting systems to make complicated worksheets easier to understand and digest.

Final Thoughts

While most positions require basic knowledge of Microsoft Office applications, proficiency levels can vary based on specific job responsibilities and the industry the candidate should be working for. However, for accountants and business or financial analysts, advanced Excel skills are a must.

If your organization is looking for someone to engage in business forecasts, monitoring, planning, and analysis, they must know how to work around multiple and complex worksheets as a requirement. The guide above can help you determine in part whether they’re the right person for the job.

Excel workbook
he template provides a 3 statement model that links the income statement, balance sheet, and cash flow statement into one dynamically connected financial model. This model acts as the base on which more advanced financial models are built, such as discounted cash flow (DCF) models, [read more]

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Excel workbook
Excel workbook

About Shane Avron

Shane Avron is a freelance writer, specializing in business, general management, enterprise software, and digital technologies. In addition to Flevy, Shane's articles have appeared in Huffington Post, Forbes Magazine, among other business journals.

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