AGRICULTURE ECONOMY IN INDIA . MONSOONS IN BRITAIN ENDS ON 31ST MARCH A fiscal year (or financial year or accounting reference date) is a 12-month period used for calculating annual ("yearly") financial statements in businesses and other organizations. In many jurisdictions, regulatory laws regarding accounting require such reports once per twelve months, but do not require that the twelve months constitute a calendar year (i.e. January to December). The financial results presented to shareholders are therefore a "photocopy" (or "snapshot") of the company's accounts at the accounting reference date. Fiscal years vary between businesses and countries.
The question u asked is discussed below.....as why it is not the calender year....
Often the fiscal or tax year is specifically established not to match the calendar year so that accounting year-end work does not coincide with periods of high activity, such as the Christmas shopping rush for retailers, or with holiday periods when employees may prefer to take vacation.
A popular use of a non-calendar year as the fiscal year involves retailers. In many countries, at the end of December, levels of inventory, receivables and payables will be higher than at other month ends and consequently more complex and time-consuming to measure accurately. Therefore, retailers commonly use a month other than December to end their fiscal year. January may be chosen as the last month of the fiscal year because activity levels are likely to be closer to normal by the end of January.
In addition, many companies find that it is convenient for purposes of comparison and for accurate stock taking to always end their fiscal year on the same day of the week, where local legislation permits. Thus some fiscal years will have 52 weeks and others 53. Major corporations that adopt this approach include Cisco Systems and Tesco.
In the United Kingdom, a number of major corporations that were once government owned, such as BT Group and the National Grid, continue to use the government's fiscal year, which ends on the last day of March, as they have found no reason to change since privatisation.
Nevertheless, for about 65% of publicly traded companies in the United States and for the vast majority of large corporations in the UK and elsewhere, except in Australia and Japan, the fiscal year and calendar year are identical.
Many universities have a fiscal year which ends during the summer, both to align the fiscal year with the school year, and because the school is normally less busy during the summer months. Examples include Harvard University and the University of Oxford.
Operation in various countries
Such fiscal years are typically numbered using a calendar year and quarter thereof. A fiscal quarter is 3 months (1/4 of a year). For example, the United States government fiscal year for 2008 ("FY08", sometimes written "FY07鈥?8") is as follows:
* 1st Quarter: October 1, 2007 鈥?December 31, 2007
* 2nd Quarter: January 1, 2008 鈥?March 31, 2008
* 3rd Quarter: April 1, 2008 鈥?June 30, 2008
* 4th Quarter: July 1, 2008 鈥?September 30, 2008
So the U.S. government's fiscal year begins on October 1 of the previous calendar year and ends on September 30 of the year with which it is numbered. Prior to 1976, the fiscal year began on July 1 and ended on June 30. The Congressional Budget and Impoundment Control Act of 1974 stipulated the change to allow Congress more time to arrive at a budget each year, and provided for what is known as the "transitional quarter" from July 1, 1976 to September 30, 1976. As stated above, the tax year for a business is governed by the fiscal year it chooses.
The Australian government's fiscal year begins on July 1 and concludes on June 30 of the following year. This applies for personal income tax and the federal budget. In Canada, the United Kingdom, New Zealand, India and Hong Kong, the government's financial year runs from April 1 to March 31, and the United Kingdom corporation tax is charged by reference to that period.
In the UK, the tax year (which governs liability to income tax and capital gains tax) runs from April 6 to April 5. This reflects the old ecclesiastical calendar, with New Year falling on March 25 (Lady Day), the difference being accounted for by the eleven days "missed out" when Great Britain converted from the Julian Calendar to the Gregorian Calendar in 1752 (the British tax authorities, and landlords were unwilling to lose 11 days of tax and rent revenue, so under provision 6 (Times of Payment of Rents, Annuities, &c.) of the Calendar (New Style) Act 1750, the 1752鈥? tax year was extended by 11 days). From 1753 until 1799, the tax year in Great Britain began on 5 April, which was the "old style" new year of 25 March. A 12th skipped Julian leap day in 1800 changed its start to 6 April. It was not changed when a 13th Julian leap day was skipped in 1900, so the tax year in the United Kingdom is still 6 April. Ireland also used this year until 2001 when it was changed to match the calendar year (the 2001 tax year was nine months, from April to December).
Companies that are units within a "group" of businesses must all use nearly the same fiscal year (differences of up to three months are permitted in most jurisdictions, such as the U.S. and Japan), with consolidating entries to adjust for transactions between units with different fiscal years, so the same resources will not be counted more than once or not at all.
I don't think this information is enough to justify the answer but this is all the information i could find out for you....
i wish u good luck.... Because It's a lovely fool day............. Because our financial year ends in 31st March. It is because of British people ruled our country. Many British practices are still in force. Some time back there was a talk to change the financial year to full years. Afterwards there is no news.
It is truly a disadvantage. Every time to mention two years for a financial year or Assessment Year.
Also left hand drive. This is also because of British rule. |
