In the immortal words of 1950s folk singer and misunderstood economist Pete Seeger, "To everything (turn, turn, turn) there is a season." That wisdom holds true for gas companies such as Enbridge, which typically hold their year-end on Sept. 30, right before the heating season gets under way but after they've had all summer to collect bills. Laurence Booth, professor of finance at the Rotman School of Management, says companies try to release their financial statements at the time of the year when they'll show in the best possible light. "If they have short-term assets and liabilities on their balance sheet," Booth explains, "that just doesn't look very good."
I know what you're wondering: What's the deal with banks? While there isn't any seasonality about banking, the big Canadian banks all close their books on Oct. 31. Don't bother asking them why. The only answer I got was, "Um, we're not sure." In the end, the Know-It-All got his answer--as he always does--this time from a dusty corner of the Department of Finance. Here it is: The banks agreed to an October year-end in 1965 as a favour to overworked accountants, who were always swamped from January to April (and twiddling their calculators the rest of the year, we can only assume). So, while there isn't anything seasonal about banking, there is for the folks counting the beans. You could argue the banks set their year-end so they could have their money and count it, too. Heck, that's almost as poetic as a folk song.
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