Year to date

Key Takeaways

  • YTD compares the change in value from the beginning of the current year to the date being discussed
  • Year to date is used both with reference to the calendar year as well as fiscal year

What is Year to Date?

Year to date or YTD compares the change in value from the beginning of the current year to the date being discussed. It helps in understanding business trends and performance over time. It also helps in comparing a company’s performance with that of its competitors in the same industry.

How is Year to Date Used?

Year to date can be mentioned both with reference to the calendar year as well as fiscal year. If YTD is used in reference to a calendar year, it refers to the time period starting from January 1 of the current year to the current date. If referring to a fiscal year, it is defined as the time period starting from the first day of the current fiscal year to the current date. A fiscal year may or may not start from January 1.

Year to date can be used by the management to analyse the company’s performance and get an interim report rather than waiting for the year end to get the annual report.

For example, if the fiscal year of a company starts from April one, a four-month YTD financial statement will go through July 31st. Then the July YTD financial statement can be compared with the July YTD statement of the previous fiscal year or years to analyse trends and abnormalities.

Regularly analysing a company’s health through financial statements may prove to be useful in early resolution of a problem.

Types of Year to Date

Year to Date Earnings:

YTD earnings refers to the gross income a person has earned from January 1 of current year to current date. It can also be used to refer to the earnings a business has made since the start of the current calendar or fiscal year.

Year to Date Returns:

YTD return assesses an investment’s performance since the start of the current year. Investors may use it to make their investment decisions.

Year to Date Net Pay:

YTD net pay refers to the pay an employee gets after subtracting all his withholdings and taxes from his gross earnings. It denotes the money earned since the start of the financial year minus all the withholdings and taxes.

How to Calculate Year to Date?

Year to Date referring to any parameter can be calculated using the formula:

YTD= (Value at a specified date/Value at start of the year) – 1

Example:

If a company’s stock price on January 1 of the current year was Rs 30, and it has moved to Rs 45 today, the stock is said to have given a return of 50 percent YTD [{(45/30)-1} *100].

Note: The year to date formula can be used in any situation where one wants to analyse the change in a parameter from the starting of the year to a particular date.