fjárár

Fjárár is a term primarily used in Icelandic finance and economics. It translates literally to "financial year" or "fiscal year." This term refers to the period for which financial statements are prepared. In Iceland, as in many other countries, the financial year can be either the calendar year (January 1st to December 31st) or a different 12-month period adopted by a company or organization.

The concept of fjárár is crucial for accounting, taxation, and financial reporting. Companies are required to present their financial performance and position over a defined fjárár. This allows stakeholders, including investors, creditors, and regulatory bodies, to assess the company's profitability, liquidity, and solvency. Tax authorities use the fjárár to determine tax liabilities.

The specific regulations and conventions surrounding the fjárár in Iceland are governed by Icelandic accounting standards and tax laws. Businesses have some flexibility in choosing their financial year-end, but once chosen, it generally remains consistent unless a formal change is approved. This consistency is vital for comparability and trend analysis over time.