What is a fiscal year end?

The term "fiscal year-end" refers to the completion of any one-year or 12-month accounting period other than a typical calendar year. A fiscal year is often the period used for calculating annual financial statements. A company's fiscal year may differ from the calendar year, and may not close on Dec. 31 due to the nature of a company's needs.

Does a fiscal year end on December 31?

A fiscal year consists of 12 months or 52 weeks and might not end on December 31. A period that is set from January 1 to December 31 is called a calendar year. Here is an example of the difference between a calendar year end and a fiscal year end: A Fiscal Year (FY) does not necessarily follow the calendar year.

Why does a company's fiscal year not close on Dec 31?

A company's fiscal year may differ from the calendar year, and may not close on Dec. 31 due to the nature of a company's needs. Once companies choose their fiscal year-end—typically when they are first incorporating or forming their company—it is required to stick with it year to year.