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The Choice of Fiscal Year‐end in Australia
Author(s) -
Lu Meiting,
Saune Naibuka,
Shan Yaowen
Publication year - 2013
Publication title -
australian accounting review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.551
H-Index - 36
eISSN - 1835-2561
pISSN - 1035-6908
DOI - 10.1111/auar.12023
Subject(s) - popularity , fiscal year , preference , business , balance sheet , balance (ability) , service (business) , accounting , economics , finance , marketing , political science , medicine , law , physical medicine and rehabilitation , microeconomics
This study examines the heterogeneity of fiscal year‐end choice in Australia. It documents substantial differences in the ‘popularity’ of balance sheet dates during 1989–2010, and an increasing preference of June year‐ends in recent years. Eighty‐one percent of Australian firms choose June to align with the mandatory tax period, followed by 13% for December and 6% for other months. The paper finds that industry membership plays an important role in the choice of fiscal year‐ends, evidenced by a strong non‐June effect for manufacturing, retail and financial service companies. Finally, it summarises four popular reasons for Australian firms changing fiscal year‐ends, and finds that 26% of those firms did not disclose the change via a separate announcement on the Australian Securities Exchange in a timely manner.