What it is:
A fiscal year-end is the end of a 12-month, 365-day, or 13-period (or other measure) period of time.
How it works/Example:
Let's say Company ABC has a
Now let's say that Company XYZ has a that begins July 1 and ends June 30. We can say that Company XYZ has a 6/30 -end.
In business, a does not always go from Jan. 1 to Dec. 31: Many companies and governments have beginning at other times. The federal government's ends Sept. 30, for instance.
Why it matters:
Yearly information is useful in looking for trends or measuring performance against goals. Remember, though, comparing year-over-year information among companies with different fiscal-year start dates can distort an analysis: The time included may vary and seasonal
Investors need to know which companies use the for accounting purposes when they are comparing companies. Particularly for seasonal industries, one company's first quarter could fall in winter and another's could fall in the summer. Thus, comparing quarterly results could become misleading if companies differ in their use of the calendar year.
For taxpayers, it's also important to consider the fiscal year-end. Deferring income to the next , for example, delay or perhaps even alter a person's tax liability.