Wondering what information you need to include in your annual report?
If you’re writing an annual report for the first time, here’s a quick look at what investors, shareholders, and other stakeholders in your business will be expecting to see.
What is an annual report?
An annual report offers a detailed synopsis of how your business has performed across the previous financial year and is a legal requirement of any publicly traded company.
What is included in an annual report?
An annual report should provide insight into your financial health, any key growth you’ve achieved over the reporting period, and evidence of how your business has performed against targets, backed up by financial statements.
As well as reflecting on past performance an annual report should also include projections for the next financial year and should open with a foreword from your CEO or similar.
Here’s a look at these aspects in a little more detail:
1. Letter from CEO (or equivalent)
This letter should set the tone for what’s inside the report, offering a brief overview of the report’s key findings. It should talk about business performance in the context of the past year’s trading climate, but avoid going into too much detail.
One great way to approach this piece of content is to imagine this is the only page of the report a stakeholder will see. What are the key takeaways and messages you want to land? That’s what needs to be included in this letter.
2. Your performance achievements
Any positive trading, increased profits, and year-on-year growth is vital to highlight within your annual report. Remember, this report is generated for both existing and potential investors in your business, so you want to reassure them that their money is safe and is likely to bring future returns.
You should also draw attention to any key achievements or milestones your business has celebrated in the reporting period, for example, a record day of sales. An annual report is essentially a golden opportunity to showcase how successful your business is, so be sure to make big noise about anything that has gone well.
3. Financial statements
Shareholders are all about the bottom line and while talking up your successes is great, any shrewd investor will want to see that the numbers stack up. This is where your financial statements come into play.
Balance sheets, income statements, and cashflow records should all be made available in your annual report. How you choose to present this information, however, is entirely up to you. We recommend using a combination of infographics and graphs to make these pages more accessible, digestible, and engaging.
4. Future growth projections
Finally, your annual report should wrap-up with a section that details what the next 12 months for your business will look like. This can include things like future trading targets and any upcoming activity, such as a rebrand, expansion, or a new launch.
While it’s great to be optimistic, it’s also good to be a little conservative here too. After all, you’ll have to report on how you performed against these projections in the next annual report you compile, so be sure to make realistic estimates you believe are attainable.
Who is an annual report for?
Annual reports are consumed by a number of different audiences, each with a vested interest in what the company has to say. These include, but aren’t limited to:
• Business shareholders (for investing decisions)
• Employees (for share and stock purposes)
• Customers (to determine if the company aligns with their values)
Ready to design your annual report?
Your annual report is a key part of your brand identity and its visual appearance is just as important as the content inside. Take a look at our 9 tips for designing a great annual report to see precisely how we approach annual report creation for our Regency clients.