What is (or should be) considered "advanced" knowledge in Excel?

Another thing to bear in mind is how well you know the business, and how creatively you can think. I've seen "seasoned" users be stymied by a new position with regards to Excel (and other job aspects), because they hadn't learned the business, or couldn't think past what they already knew.

If you can look at data in ways that will be meaningful to the business, then you can learn what you need/can do with it in Excel, especially if you already have a good grasp of it.
 

Excel Facts

How to create a cell-sized chart?
Tiny charts, called Sparklines, were added to Excel 2010. Look for Sparklines on the Insert tab.
Try to find out exactly what they're looking for. Talk to whomever is in charge of the spreadsheet and, if you can, get a copy of the workbook(s). My old boss didn't have a clue as to how good I was with Excel. He literally told me one time that if I got stuck, Brett, an engineer with whom I worked knew a bit about macros and might be able to help me; not knowing that I had helped Brett out of several VBA jams and that I knew about twenty times as much as Brett when it came to Excel.

If the person in charge of hiring for this position is looking for someone to take the reins from himself then yes, he will be able to articulate what he needs. However if the hiring manager is looking to replace someone and he is not the person that built whatever-it-is; or if the position is new then there is a very good chance he or she will not have a deep grasp of the skills needed. Looking at the workbooks themselves is the best way to gauge whether this is something you think you can tackle.
 

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