The “year” defines the amount of time it takes the Earth to make a full orbit around the sun. During this lengthy journey, we experience 4 seasons, 12 months, 365 days, 8,760 hours and 525,600 minutes. But what does our planet’s trek around the sun have to do with the accounting rhythm of your organization? The correct answer, unless you are a farmer, is: Nothing.
The calendar year is simply a construct made by humans to help explain and predict the seasons of our planet. It shouldn’t have as much impact on business as it does. Frequently I hear business leaders talk about their annual budget, or this year’s sales goal. Many bonuses and incentives are based on annual targets. But why should a sales goal be based on the amount of time it takes our planet to travel 92.96 million miles? They have no direct connection.