What is an Accounting Year?

An accounting year is a period of time, usually 12, during which businesses calculate their accounts and organize their financial activities.

The accounting year, also known as the accounting period, occurs usually on any date other than January 1st to December 31st. Any accounting year that falls on these dates is also known as a calendar year.

The accounting year differs depending on the business. For example, a school district will have an accounting year that fits with its natural business year. This would be an accounting year starting on July 1st and ending on June 30th. Alternatively , retail stores can have their accounting year starting on February 1st and ending on January 31st to take into account the end-of-year holiday shopping season.

While your accounting year is dependent on you, you need to make sure it is consistent, and therefore you should choose your accounting year strategically.

The most common accounting years are:

• February 1 through January 31

• October 1 through September 30

• June 1 through May 31