Financial Year End (FYE)

Summary: A company’s annual accounting period determined by itself.

The Financial Year End (FYE) essentially refers to a company’s annual financial accounting period, as outlined in Section 198(1) of the Company’s Act. The initial financial year of a company commences from the point of its establishment and concludes on a date that it determines. This period shouldn’t exceed 18 months unless the Registrar grants an exception. Every subsequent financial year thereafter launches on the day following the end of the previous year, spanning for 12 months or 52 weeks, as designated by the company.

 

When is the Right Time for the Financial Year to End?

Although companies can select their Financial Year End, most opt to align it with the calendar year, generally ending in December, for simplicity in reporting and tallying. Nonetheless, some may choose different months for their financial year’s closing.

Once a company decides on a specific FYE, it must inform ACRA during its incorporation. A company’s chosen FYE has several regulatory compliance implications, alternating scheduling for events such as annual general meetings (AGMs), the filing of estimated chargeable income (ECI), annual returns, and corporate tax reporting deadlines.

 

Can You Change the Financial Year End?

Companies can adjust their Financial Year End for the forthcoming years by informing ACRA via the BizFile+ platform. However, this can only be done for the current or the preceding financial year, given the deadlines for conducting the AGM, submitting the annual report (AR), and distributing financial statements have not expired.

Even so, companies should avoid changing their FYE indiscriminately. Any company wishing to alter their FYE multiple times or intending to extend their financial year beyond 18 months, or those that have changed their FYE in the last five years, need to obtain the Registrar’s approval.