My interest in the world of finance started during my tween years. My entrepreneurial family would tune into the closing stock report every weekday. Terms like fiscal quarters, dividends, and year-over-year growth were tossed around the dinner table in response to the news.
Years later, I became a business reporter. Now, my life is structured around fiscal quarters, reporting on company performance at each quarter’s end. Here’s what I’ve learned about quarters in the financial world and my experience covering company performance for years.
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Table of Contents
What Are Business Quarters?
Business quarters are the basis for quarterly financial reporting and stock dividends. They occur every three months during a 12-month period. Quarters are typically abbreviated to Q1, Q2, Q3, and Q4. To avoid confusion, quarters may also be listed with the year attached, such as Q2 2025 or Q3 ’24.
“[Business quarters] help companies organize financial reporting and track progress more often than once a year,” says Chris Heerlein, CEO of the wealth management firm Heap Financial. “It’s like setting up smaller checkpoints to assess how things are going and adjust if needed.”
When exactly a fiscal year begins varies based on the type of business, seasonal considerations, and country where the business is located. Some businesses may start their year in January. Others may begin later in the year.
The federal government begins its fiscal year on October 1, a schedule that many U.S. businesses follow. The quarters conclude at the end of every three months, four times a year, until the next fiscal year rolls around. Common fiscal years in other countries include:
- Australia: July 1 - June 30
- Canada, India, Japan, United Kingdom: April 1 - March 31
- Most European countries: January 1 - December 31
“Many countries, including most of the European Union, have moved away from the U.S. mandatory quarterly reporting to a semi-annual schedule where companies only report twice each year,” Sunil Manjunath, managing director of the loan firm Onetouchfinance.com in Bangalore, India, told me.
At the end of each fiscal quarter, publicly traded U.S. companies must file financial statements with the Securities and Exchange Commission (SEC). This document, a Form 10-Q, must be certified by the company’s CEO and CFO. Those C-suite executives must also sign off on annual financial statements filed with the SEC through a Form 10-K. However, there are some exceptions.
“If your company qualifies as a ‘smaller reporting company’ or an ‘emerging growth company,’ it will be eligible to rely on scaled disclosure requirements for these reports,” writes the SEC.
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The Differences Between Business/Fiscal Quarters and Calendar Quarters
Fiscal quarters can match up with calendar quarters. However, Jonda Lowe, author and proprietor of the financial advisory site JondaKnows.com, shared an important distinction.
“Some businesses have sales cycles that do not align with the calendar year, so they elect a fiscal year that begins on May 1, July 1, or September 1 and is better suited to their sales cycles,” Lowe says.
Calendar quarters refer to the normal quarters of any year, beginning with January. So, March would mark the end of the first quarter. Fiscal quarters don’t have to line up with the calendar year.
Reconfiguring the Tax Year
Once a company has adopted a tax year, it’s set unless the business applies to the Internal Revenue Service (IRS) for a change. That request requires filing Form 1128 with the SEC. Businesses may ask for a change if the tax year they have adopted is out of sync with the ebbs and flows of their industry.
If the business qualifies for an automatic approval request, the IRS doesn’t charge the business a user fee. “If you do not qualify for automatic approval, a ruling must be requested, and a user fee is required,” wrote the IRS.
“Fiscal quarters allow a company to match their sales cycles with their expenses. A company that experiences the seasonal effect could benefit from fiscal quarters [and] years,” Jonda Lowe added.
Examples of seasonally impacted companies include the tax preparation company H&R Block, whose busiest time in the U.S. is around the tax filing date of April 15.
Construction companies offer another example. They’re busier during the warmer months, where working outside is easier. Similarly, retail businesses see greater traffic during the end-of-the-year holidays. These businesses adjust their quarters within fiscal years, starting and ending at different times.
Why Business Quarters Matter
In quarterly filings, I’ve always found a wealth of information that can help businesspeople decide whether it’s wise to invest in a company. These documents include income and cash-flow statements, a balance sheet, and an executive summary. Beyond that, if the company pays quarterly dividends, these documents show investors how much they get.
As a reporter, I appreciate how 10-Qs and 10-Ks lay out the company’s performance. I can see what risks may affect the business and learn about any major changes that could impact operations. That can include supply shortages, tariffs, and inclement weather. In these documents, I can find context forthe business’ progress or decline.
Pro tip: If you want to invest in a business, study quarterly and annual filings to assess whether the company’s stock is right for you. You can find all of a public company’s filings on the SEC’s EDGAR.
Manjunath told me, “Successful businesses view quarterly reporting not as a compliance exercise but as a strategic opportunity for comprehensive financial storytelling and insight generation.”
Quarterly reporting is a way to maintain transparency for investors and provide principles of discipline for management. However, not every business leader is in favor of quarterly reporting.
“The cons are the cost it takes to produce them as well as potentially distracting management on short-term results versus long-term value creation over time,” says Paul Miller, a CPA and managing partner of New York-based tax accounting firm cpafirmnyc.com.
The release of quarterly results can also create a market-moving event. Reporting can cause stock prices or industry performance to shift — for better or worse.
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Fiscal Quarters and Tax Deadlines
Fiscal quarters don’t just matter for big companies. If you own your own business, you’ll want to keep track of quarters so you can manage your taxes.
At the end of quarters, taxes are due for professionals who have earned money through freelancing, as small business owners, or through “non-wage income,” like retirement or health benefits.
As a freelance writer, I pay what are called “quarterlies,” or quarterly taxes. These are estimates of taxes owed for the calendar year in progress. I pay four times a year to the federal, state, and local governments.
Even when in a salaried position, if I earned extra income through freelance gigs, I am required to pay quarterly taxes if I earn over a certain amount.
According to the IRS, estimated federal tax payments were due according to the following schedule for 2024:
- April 15 for income earned from January 1 to March 31.
- June 15 for income earned from April 1 to May 31.
- September 15 for income earned from June 1 to August 31.
- January 15 of the following year for income earned from September 1 to December 31.
Pro tip: Add quarterly tax due dates to your calendar, so you don’t miss a payment. You’ll stay on top of your taxes and avoid paying penalties.
Quarters Do Add Up
Every three months, a fresh filing brings news of a business’ status. During my reporting, I’ve noticed that quarterly filing can bring dread or hope for the future.
If you’re an investor, it’s critical to access the information in the quarterly and annual reports to suss out which way a business is headed. Through that due diligence, you will notice that quarters do indeed add up, leading you to greater knowledge of companies’ and industries’ performances.
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