The “Year in Period Name” field is a feature designed to offer flexibility in determining how fiscal periods are denoted, specifically regarding whether the starting or ending year is used in the period’s name.
Let’s break down this concept with a simple example. Consider a fiscal year that commences in 2020 and concludes in 2021. If you opt for the “Starting Year of Period” in the field, the system will use 2020 as the name of the period. This choice reflects the emphasis on the initial year of the fiscal cycle.
Taking a real-world scenario in India, where the financial year aligns with the calendar year, let’s explore the fiscal period starting on April 1, 2023, and ending on March 31, 2024. In this context, selecting ‘Starting Year of Period’ would result in the period being named 2023. This is because the fiscal activities span from the start of April 2023 to the end of March 2024.
It’s noteworthy that the default value for the “Year in Period Name” field is ‘Ending Year of Period,’ aligning with the conventional naming convention where the concluding year of the fiscal duration takes precedence.