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Fiscal year reporting periods
GregVeres
Member Posts: 24
My fiscal year end is june 30. This makes using reporting in wave a real pita as far as I can see so far. I have told wave my year end, but there are only calendar year pre-sets for date ranges in the reports. There should be fiscal year date ranges as those are more important.
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Hi, @GregVeres.
I think that's an understandable expectation and I'll forward your feedback to our product team. Thanks for taking the time to reach out and share!
Yes this is an issue - I'm due to submit my corporate tax return, and I'll need to go through the individual transactions from July 31st 2017 to July 31st 2018 in order to rebuild an accurate balance sheet that I can use to submit the figures to the relevant tax authorities. Can you please mark this as an urgent bug? (it pretty much renders the software useless for companies that have an end date other than December 31st)
I notice that this was raised last year - not a very good sign. I know the service is free, however I cannot continue to use the service with such poor reporting, as the whole point of logging the transactions is for record keeping and reporting. Not impressed.
Hi @JamesW,
I'm not sure I understand the issue you are raising.
Wave reports have a convenience feature to select a Calendar Year or Calendar Quarter, but you can enter any date range you want directly into the report start/end fields.
For example, if my Fiscal Year happened to end on 10th February, I'd pick the dates like this:
Do let me know if I'm missing something, and I'll try to recommend a solution.
Hi Paul, firstly, many thanks for the prompt reply.
This is for the income statement, the same functionality does not exist for the balance sheet. If you navigate to the balance sheet reporting section, select a "year" (i.e. 2018) it will select accounts up until December 31st 2018. Most companies have a variable year end, so this is confusing as you don't know if the accounts start from January 1st when you select a custom date (e.g. a company with a year end of June 30th might be selecting accounts from January 1st to June 30th).
I understand that balance sheets illustrate an annual snapshot, however the dates panel does not make it very clear. A "from/to" option or an extra item in the dropdown which takes the year end from the settings area would be helpful.
Hi @JamesW
I see what you are saying about the balance sheet. I think with a slight adjustment to your definition of a balance sheet, the software will become clearer. You said this: "I understand that balance sheets illustrate an annual snapshot." If you remove the word annual from what you wrote, then you will get the actual definition of the balance sheet and hopefully, that will make it more clear why the software doesn't have a from/to date setting.
A balance sheet is just a snapshot at one particular point in time. It represents what assets your company had at that point in time. So if you were looking to do a fiscal year-end balance sheet, you would select the balance sheet report and set the single date to the date of your fiscal year-end. In my case, I do my fiscal year-end balance sheet reports for June 30th of the particular year I am interested in.
If you want to see how your balance sheet changed during that fiscal year, you have to run the balance sheet twice and compare the two reports (once at the year-end of last year and once at the year-end of this year).
I still wish that Wave would add the year-end dates in their drop downs for convenience, but the core functionality you need to run the business is there.
I hope that helped.
Greg
Hi @GregVeres
What I was trying to illustrate is that from a UX perspective, you can select calendar years, however not financial years, unless you select a custom end date - which could further because the start date is not clear. This is the source of my frustration in the initial query, and I stumbled across a FROM date in the equity section, which gave me reassurance that the "custom" dates functionality set the start date as of the financial year and not from the beginning of the calendar year.
To have to search the balance sheet in order to find out this information proves that the interface/methods are not UX friendly and will not instil confidence in the figures for many new users of the reporting. Most companies have variable financial years which are submitted to various endpoints by accountants/directors for reporting purposes, and therefore is a haphazard method of generating reports, rather than offering the obvious functionality of selecting by financial year.
Hope that clarifies the issue!
J
Hi @JamesW
I hear you. I am the one who started this feature request thread to say that the system already knows my company's year-end because I told it. It should use that information to provide better choices for the reports.
I was trying to point out that a balance sheet report is not a time period report so it doesn't have a start date and an end date. It just as an end date. It shows the value of your accounts / assets on that date in time regardless of how long your business has been around. I was just trying to clarify that aspect of what you wrote.
I definitely agree that all reports should not contain "Calendar Year", but should instead contain "Fiscal Year" date selectors.
@GregVeres
Yes I agree - I was trying to present what could constitute a viable solution to the UX issue with a start/end (it'd give the user total freedom), however this may not be fit for purpose from an accounting point of view, likewise to reporting in calendar years. Clearly the solution is to scrap the calendar year option and implement a report by financial year, instead of having the user to find a workaround and select a custom date only to be in the dark about start dates - users are given the initial impression that the interface is strictly calendar year only, so it confuses matters when selecting a custom end date.
We now know that it's an issue and the corresponding workarounds, however newer users may themselves having to work through the UX friction in order to find reassurance of reporting periods via the same investigations/trial and error. Hope they sort it soon!
Hi @JamesW,
Thanks you for clarifying your issue. As you and @GregVeres have suggested, "My Financial Year" (for Income Statement and Cash Flow reports) and "My last Financial Year End" (for Balance Sheet) would indeed be a nice convenience factor. Noted.
I'd like to reinforce the answer that @GregVeres gave you - the Balance Sheet is not from the start of the financial year; it is a statement of the assets and liabilities of the business at a single date. There is no concept of a 'start date' in the Balance Sheet.
If you'd like to understand in a little more depth why this is so, I'd warmly recommend you take a look at our Fearless Accounting with Wave Guide - especially Accounting Coffee Break 1 which demystifies the Income Statement and Balance Sheet, and Accounting Coffee Break 4 which explores the relationship between the Balance Sheet and Income Statement over time:
BTW - @GregVeres, you mentioned running the Balance Sheet twice and comparing. That is completely correct, but note we now have an Add-on for Google Sheets](https://support.waveapps.com/hc/en-us/articles/360020768272) that provides the ability to capture and compare your Income Statement, Balance Sheet and Cash Flow Report over multiple periods - Weekly; Monthly; Quarterly; Annual; or any ad-hoc periods you choose.
Hope that helps!
@PaulC
Thank you for this! Just a correction, however - There are components of a balance sheet which do rely on a date from and date to such as retained earnings (profit between date a and date b) and having different periods for this can greatly affect the total equity of a balance sheet (I know you take year end, however I had to search the balance sheet for this to assure myself that your system aligns the balance sheet as such).
For example, I've just compiled a report using "as of 2018", which for my company selects the date range between August 1st 2018 and December 31st 2018 to calculate profit. So a start date from which to compile the profit is defined in the balance sheet.
The point I am making is that the impression you are making by allowing a user to select a report to the end of the fiscal year (and not financial), suggests that these profit/loss figures are calculated from a fiscal year perspective, rather than the financial year (essentially blurring the lines). I'm just highlighting that calculating between fiscal years may create a confusion for a lot of first year users as I had to reassure myself that wave was taking figures as of my end date to calculate profit rather than as of the start of the fiscal year.
I know that accounting methodologies are what they are, however you can't just expect users to trust your service for such important returns, especially when there's little use for such fiscal based functionality. UX can make or break confidence in a service.
Thank you, Paul - UX can make or break confidence in a service, regardless of accounting methodologies. Services cannot expect instant confidence from users, they have to evoke it, by assuring users. Blurring the lines between fiscal and financial years (especially in the case of retained earnings on a balance sheet) creates UX friction and confusion. A quick guess is that a lot of wave users are managing their own accounts, and therefore require guidance from the interface to reassure them that the figures are ready for submission to the relevant authorities, otherwise they'd hire an accountant/bookkeeper to manage the books.