Definition of Accounting period:
There are typically multiple accounting periods currently active at any given point in time. For example, an entity may be closing the financial records for the month of June. This indicates the accounting period is the month (June), although the entity may also wish to aggregate accounting data by quarter (April through June), half (January through June), and an entire calendar year.
Period for which a firm prepares its internal or external accounts; the period covered by the financial statements. For internal accounts, it may be a month or a quarter; for external accounts it is normally a period of 12 months.
An accounting period is an established range of time during which accounting functions are performed, aggregated, and analyzed including a calendar year or fiscal year. The accounting period is useful in investing because potential shareholders analyze a company’s performance through its financial statements that are based on a fixed accounting period.
A period of time for which accounts are prepared or presented.
How to use Accounting period in a sentence?
- An accounting period is a period of time that covers certain accounting functions, which can be either a calendar or fiscal year, but also a week, month, or quarter, etc. .
- Accounting periods are created for reporting and analyzing purposes, and the accrual method of accounting allows for consistent reporting. .
- The matching principle states that expenses should be reported in the accounting period in which the expense was incurred, and all revenue earned as a result of that expense be reported in the same accounting period.
Meaning of Accounting period & Accounting period Definition