Accounting Period

 

 

It’s the period for which financial statements prepared of an entity. One accounting period consists of 12 months. This time period can be from January to December (calendar year) or April to March (Fiscal Year).

Accounting period varies according to type of business. For example, if a business set forth on February 12 then its first accounting period would be from February 12 to February 28/ 29.

Again, if a business shut down on March 25 then its final accounting period would be from March 1 to March 25.  Accounting period pertain to only income and cash flow statements as balance sheet prepared on a specific date.

 

 

Dividends

Dividend is the share of profits of a company / entity with shareholders. After paying to its creditors company can share some or whole profit with its shareholders. Company can also skip paying dividends if it needs funds for reinvestment or any other business work.  Company also can decide the date and rate for dividend pay. Normally, dividend paid quarterly and monthly.

 

Decentralization

Decentralization refers to the delegation of the decision making and other powers of higher authority to the lower units or sub units.

Decentralization allows higher authority to invest their time in other areas for expand and growth of the business.

Sometimes this became sub-units took decision which is better for them not for the business.