Set up Fiscal Year

Set up Fiscal Year


A fiscal year is a period of one year that a business uses to plan, align, track, and analyze its activities, including sales.

Fiscal years of organizations may not coincide with the Gregorian calendar (spanning from January 1 to December 31). There can be multiple reasons for this difference, such as legal regulations in a region, seasonal patterns in sales, lower cost of auditing services, and so on.

In many industries, there is an additional need to divvy up the fiscal year into periods that are more uniform than calendar months. So, they may look at a fiscal year as 52 weeks instead of 12 months. For example, in the retail industry, the contribution of weekend sales usually outstrips weekday sales. In such cases, retail businesses would like to split the fiscal year into periods that include the same number of weekends. This enhances the comparability of sales data (across weeks, periods, and quarters), improves forecasting, eases payroll calculation, and simplifies accounting work. Many retail businesses have adopted the 4-5-4 fiscal year format.

In Zoho CRM, you can select the fiscal year type that suits your organization:
  1. By default, the standard fiscal year format is chosen and the fiscal start month is set to January.
  2. If businesses want to shift the starting month, they can do so by selecting a different starting month.
  3. If they want to align to other fiscal year patterns, they can choose the custom fiscal year format and pick from the available options.
The standard fiscal year format is where the fiscal year consists of 12 calendar months. The start of the month can be chosen based on your preference.

The following custom fiscal year formats are available:
  1. 4-4-5, 4-5-4, or 5-4-4: In these quarter-based formats, each quarter has 13 weeks. Within a quarter, these 13 weeks are spread across three periods. The number of weeks in these three periods gives the names of these formats: 4-4-5, 4-5-4, and 5-4-4.
  2. 3-3-3-4, 3-3-4-3, 3-4-3-3, or 4-3-3-3: In these year-based formats, each period consists of four weeks. A fiscal year consists of 13 such periods. These periods are distributed across four quarters in 3-3-3-4, 3-3-4-3, 3-4-3-3, and 4-3-3-3 formats. The names indicate the number of periods in each of those four quarters.

Since these formats split the year into 52 weeks (364 days), there is always a slip of a day each year. In addition, you will have the slip of an extra day in a leap year. Depending on your needs, you may need to add an extra week to a financial period. For example, you may need to do this if you want every fiscal year to begin on the first Monday of April. You can add an extra week to any of the upcoming fiscal periods to correct for this.

For both standard and custom fiscal years, you can also select how the fiscal period will be displayed in the CRM.

For both, you'll be able to choose whether the display year is the starting year or the ending year. For a fiscal year spanning 2023 and 2024, the display year can be the starting year (2023) or the ending year (2024). Depending on your choice, the third quarter may be denoted as Q3 2023 or Q3 2024.

Once set, the fiscal year will be used in forecasts, reports, dashboard components, and other places in the CRM.

To set up a standard fiscal year

  1. Log in to Zoho CRM with Administrator privileges.
  2. Navigate to Setup > General > Company Settings > Fiscal Year.
    If you've already set the fiscal year before, click Manage Fiscal Year.
  3. In the Manage Fiscal Year page, do the following:
    1. Select the Fiscal Year Type as Standard Fiscal Year.
    2. Select the starting month from the Fiscal Year begins in drop-down list.
    3. For Display Fiscal Year Based on Q-YYYY, choose Starting Year or Ending Year. This option will not be visible if the starting month is January.
    4. Click Save.

To set up a custom fiscal year

  1. Log in to Zoho CRM with Administrator privileges.
  2. Navigate to Setup > General > Company Settings > Fiscal Year.
    If you've already set the fiscal year before, click Manage Fiscal Year.
  3. In the Manage Fiscal Year page, do the following:
    1. Select the Fiscal Year Type as Custom Fiscal Year.
    2. Select the Format from the dropdown list. It can be a quarter-based format like 4-5-4 or a year-based format like 3-3-3-4.
    3. Set the Start Date by selecting the date and month from their respective dropdown lists.
    4. Configure the display options. For Display Fiscal Year Based on on Q-YYYY, choose Starting Year or Ending Year.
    5. Select Number by Year or Number by Quarter in the Period display option dropdown list. A preview can be seen below this list.
    6. Click Add Surplus Week if needed.
    7. In the Add Surplus Week popup, select the Period where the surplus week is to be added. A Preview in Calendar option is available.
    8. Click Save.

To view the history of fiscal year configuration changes

  1. Log in to Zoho CRM with Administrator privileges.
  2. Navigate to Setup > General > Company Settings > Fiscal Year.
  3. Under the Earlier years section, you'll be able to see the list of all fiscal year changes.

Note
  1. If you've chosen Custom Fiscal Year, a Preview in Calendar button will be available in:
    1. The Fiscal Year tab
    2. The Manage Fiscal Year page
    3. The Earlier years section of Fiscal Year tab (when you hover over a custom fiscal year entry)
Click this button to get a quick preview of the configured fiscal year.

SEE MORE

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