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HELLO Sir Mike, i hope you are in good health.:)
Its pathetic that at such stage i am asking a silly question, even then i would like to ask.
Are accounting periods same as year end?i mean if a business year end is 31 Decemeber 2012, will its accounting period be same as well?
Hi
No, accounting period is NOT the same as year end. As the words themselves tell you, and “accounting period” is a period of time. So, typically in life as in exams, and accounting period is normally a full year. But it could be ANY period of time – even something as obscure as, say, 14 months ( where, for example, a company has been acquired by a new parent and the parent is now changing the subsidiary’s year end to be coterminous with that of the parent )
As alluded to in the previous paragraph, a year end is one particular date / day. Typically, an entity will have a 12 month accounting period ending on its year end date. So a Statement of Income may be for the year ( accounting period ) ended 31 December, 2011 ( year end )
I had a client who decided his year end was 14 October. The reason? He had started his business the previous year on 15th October, so midnight on the 14th was, in his mind, the completion of a full year.
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