Business, Legal & Accounting Glossary
Year-to-date balance refers to the total balance in an income statement account for the current year, up to the end of the most recent reporting period. Thus, for financial accounts prepared on a calendar year basis, the idea relates to the period beginning January 1 and ending December 31.
Year-to-date balances are often reported for revenue, spending, gain, or loss accounts and are compared to the preceding year’s year-to-date figures in order to assess a business’s success for the current year. Year-to-date net sales and year-to-date net profits are of great interest to investors, as they are the best indications of aggregate business success.
In accounting and related reporting contexts, year-to-date signifies that reported figures reflect the period from the start of the year until the indicated date.
The year-to-date period is usually assumed to be a calendar year. Within an organization having a different fiscal year, internal year-to-date reports may instead be based on the fiscal year-to-date. Year-to-date figures are most useful for budgeting and other comparisons against a business unit’s goals. Financial performance, especially for a portfolio, will also be reported on a year-to-date basis, too. For instance, the financial press might report a stock index, such as the FTSE 100, as being up 2% year-to-date. For analysis of individual securities, year-to-date performance is typically superseded by a comparison of the most recent quarter against the same quarter the prior year, and perhaps also the prior quarter. Year-to-date is commonly abbreviated as YTD.
Year-to-date (YTD) is the period between the first day of the calendar year and the current date. It is generally used for the calculation of investment returns on a security or a firm’s income to the current date.
Year-to-date is widely used by financial analysts to provide details about a firm’s performance during a specified period or to compare the return of a portfolio during a specified period. By calculating YTD results, managers can perform a comparison between the firm’s current performance and the performance of past years.
For instance, the fiscal year for most companies is on January 1. The YTD results for company A to the current date (April) are $500,000 revenues in January, 250,000 revenues in February, 356,000 revenues in March, and $485,000 in April, a total of $1,591,000 YTD. Comparing YTD results with the results of the previous fiscal year allows the firm’s manager to identify areas that may need improvement. On the other hand, a YTD comparison should be performed on companies with a common fiscal year start date to avoid distortion of results due to seasonal or other factors.
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This glossary post was last updated: 13th April, 2022 | 0 Views.