Compound interest Bpp question

Good Morning John,

If a single sum of $12,000 is invested at 8% per year with interest compounded quarterly, what is the amount to which the principal will have grown by the end of year three? (approximately)

Ans: 8%per year equals 2% quarter
1.02×4 – 1 = 0.08243 = 8.243%
12,000 (1.08243)x3 = 15,218.81

Please can you explain why do we subtract by one?

Wouldn’t we do 12,000 x 1.02(x4) to get the answer?

Many thanks.