Financial Year End (FYE)
Financial Year End (FYE) is a company’s financial reporting period. As per Section 198(1) of the Company’s Act, the company’s first financial year starts from the time the company is incorporated and ends on the date decided by the company. It should not be more than 18 months unless approved by the Registrar. Henceforth, the financial year starts from the day the previous financial year ends and ends after 12 months or 52 weeks, whatever is decided by the company.
A company has the flexibility to choose their FYE, but most companies prefer to use a calendar year as their financial year for ease of reporting and tabulation like December. However, some companies can choose to use Jan, March, June, or September or October as their financial year-end.
Once the company has chosen a financial year-end, it will have to communicate the financial year-end to ACRA during incorporation and IRAS. Various regulatory compliance requirements are linked to a company’s FYE, like holding AGMs, filing for ECI, annual returns, and corporate tax reporting deadlines.
Can the Financial Year End (FYE) be Changed?
Yes, the company can change its FYE for the subsequent years by notifying ACRA via the BizFile+ website. The FYE can be changed only for the current or immediate previous year provided the deadlines for holding the AGM, filing of the annual report (AR), and sending of financial statements have not passed.
Do note that FYE should not be changed frequently. The companies need to seek Registrar’s approval for multiple changes of FYE and if:
- The change in FYE would result in a financial year longer than 18 months.
- The FYE was changed within the last 5 years.