What is a Calendar Year?

A calendar year is the period between January 1 and December 31.

How Does a Calendar Year Work?

If Company XYZ starts its fiscal year on January 1 and ends its fiscal year on December 31, then Company XYZ's fiscal year is said to be on a calendar year basis. Many companies align their fiscal years with the calendar year, but some don't. For example, Company ABC might start its fiscal year on October 1 and end on September 30.

Why Does a Calendar Year Matter?

It is important for investors to know whether a company uses a calendar year or another period for their fiscal year, especially when comparing companies in seasonal industries.

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