Overview

Accounting comes first because it's the floor everything else stands on. The three financial statements, how they link, and what depreciation, working capital, and deferred taxes actually do to a company's cash are the raw material every later topic manipulates. An interviewer who doubts you understand the three statements will not trust anything you say about a DCF or an LBO, because both are just different ways of using the numbers those statements produce.

Enterprise Value and Equity Value comes next because it's the translation layer between accounting and valuation. Once you can read a company's financial statements, the next question is what the company is actually worth, and to whom, since the value that belongs to shareholders and the value of the whole operating business are two different numbers with a specific, calculable bridge between them. Every valuation method that follows expresses its answer as one of these two figures, so getting the distinction backwards corrupts everything built on top of it.

Valuation comes after that because it's where the EV/equity value distinction actually gets used: a DCF and a set of trading comps are two different ways of estimating enterprise value from a company's fundamentals or from what similar companies trade at, and a candidate needs the accounting and the EV/equity groundwork solid before either method means anything. LBO and M&A come last because they're applied cases: an LBO is a specific transaction structure built on top of a valuation and a debt schedule, and an M&A model is a specific transaction structure built on top of two companies' financial statements and their combined valuation. Both assume everything before them, which is why skipping ahead to practice paper LBOs before the accounting and valuation foundation is solid rarely works, the LBO questions expose the gaps in the earlier material instead of testing LBO-specific knowledge.

Accounting covers the three financial statements (income statement, balance sheet, cash flow statement), how a single transaction moves through all three, and the recurring technical wrinkles interviewers ask about once the basics are solid: goodwill and impairment, deferred taxes, inventory accounting, and the practical differences between GAAP and IFRS.

Enterprise Value and Equity Value covers the distinction between what a business is worth to all its capital providers versus to shareholders alone, the bridge that converts one into the other, and how that distinction determines which valuation multiple is appropriate for a given metric.

Valuation covers the three core ways to estimate what a company is worth: a discounted cash flow, built up from a company's own projected cash flows and a discount rate; trading comps, based on what similar public companies trade at; and precedent transactions, based on what similar companies have actually sold for. It also covers when each method carries the most weight and how to reconcile a range of values into one view.

LBO covers what makes a leveraged buyout work as a transaction: the value-creation drivers, how the debt is structured and sized, the returns math (IRR and MOIC), and the paper LBO, a stripped-down mental-math version of the model interviewers use to test whether the underlying logic actually clicked.

M&A covers why companies acquire each other, how a deal gets financed and structured, the accretion/dilution math that determines whether a deal helps or hurts the acquirer's earnings per share, and the purchase accounting and synergy assumptions that go into a real merger model.

A first-round or HireVue-style screen tends to stay close to the accounting and EV/equity value floor, since that's the fastest way to filter out candidates who haven't done the work at all. A superday goes further into valuation and usually asks for a full walk-through of a DCF, since that single question touches nearly everything in the first three modules at once. LBO and M&A questions tend to show up more at banks and groups where those transaction types are the actual daily work: restructuring and leveraged finance groups probe LBO and credit concepts harder, while M&A-focused groups and elite boutiques lean harder on merger-model mechanics.

The practical implication is that going in order through these five modules isn't just a study convenience, it's close to how the real interview loop is actually structured: broad accounting and valuation fluency first, then depth in whichever transaction type matches the group being interviewed for.