A Settlement of accounts in Japan

When is the Japanese Company's closing day!?

A Settlement of accounts is called Kessan in Japan. Japanese company must make a report on the closing within 2 months from a closing day. Japan Exchange Group which runs a stock exchange called the Tokyo Stock Exchange makes liseted companies make a report within 45 days from a closing day.

Japanese company can decide when to make a report on the closing, but many companies do it in the end of March. A fiscal year of the Japanese goverment is also from April to the next year's March. On the other hand, Japanese taxpayers file one's income and tax information for one year to the Tax Office along the calender year.

There are several theories about the settlement of account in March. One of them is the tax low often changes from April 1st. It is hard for comapanies to change how to deal with accounts in the moddle of the fiscal year, so they set the settlement of account in March. The other is companies go along with goverment and local public body because goverment and local public body often order in one go before fiscal year end. Companies can add up them in their fiscal year. In addition, companies employ a large number of students in April because most students graduate their collage in the end of March.

There is also an end of financial year sale(EOFY) in Japan. It is held to carry out a stock clearance and achieve earning forecast especially on March or September. However, some companies focus on summer and winter sale for a bonus month rahter than end of financial year sale. Japanese comapnies usually pay bonuses twice a year, June or July and December.

By the way, most retail companies in Japan make a report on the closing in the end of February, FAST RETAILING (UNIQLO), AEON, SEVEN ELEVEN, LAWSON and more. AEON is a group of retail and finanial service companies, SEVEN ELEVEN and LAWSON are famous conveniece stores. It is said the sales of February and Augusut is not good in Japan's retail industry, these companies do it in an idle month.

However, some companies change their accounting month from March or February to December because of IFRS(International Financial Reporting Standards). Mainly export companies have time lag of fiscal year. Their head office make a report on March, foreign subsidiary make a report on December. IFRS make companies unify the accounting month to understand and compare company accounts across international boundaries. Kao Corporation which is is a chemical and cosmetics company changed accounting month from March to December in 2012. Softbank Group Corporation also change it in 2014 when Softbank acquired Sprint Nextel(Sprint Corporation).

You can experience Japanese culture through EOFY or looking busy Japanese if you travel Japan in March.