An annual report is a comprehensive

report A report is a document that presents information in an organized format for a specific audience and purpose. Although summaries of reports may be delivered orally, complete reports are almost always in the form of written documents. Usage In ...

on a company's activities throughout the preceding

year A year or annus is the orbital period of a planetary body, for example, the Earth, moving in its orbit around the Sun. Due to the Earth's axial tilt, the course of a year sees the passing of the seasons, marked by change in weather, the ...

. Annual reports are intended to give

shareholder A shareholder (in the United States often referred to as stockholder) of a corporation is an individual or legal entity (such as another corporation, a body politic, a trust or partnership) that is registered by the corporation as the legal ...

s and other interested people information about the company's activities and financial performance. They may be considered as grey literature. Most jurisdictions require companies to prepare and disclose annual reports, and many require the annual report to be filed at the company's registry. Companies listed on a stock exchange are also required to report at more frequent intervals (depending upon the rules of the stock exchange involved).

Content

Typical annual reports may include: * General corporate information * Operating and financial review * Director's Report *

Corporate governance Corporate governance is defined, described or delineated in diverse ways, depending on the writer's purpose. Writers focused on a disciplinary interest or context (such as accounting, finance, law, or management) often adopt narrow definitions ...

information *

Chairperson The chairperson, also chairman, chairwoman or chair, is the presiding officer of an organized group such as a Board of directors, board, committee, or deliberative assembly. The person holding the office, who is typically elected or appointed by ...

s statement * Auditor's report *

Sustainability Specific definitions of sustainability are difficult to agree on and have varied in the literature and over time. The concept of sustainability can be used to guide decisions at the global, national, and individual levels (e.g. sustainable livin ...

and ESG information * Contents: non- audited information *

Financial statement Financial statements (or financial reports) are formal records of the financial activities and position of a business, person, or other entity. Relevant financial information is presented in a structured manner and in a form which is easy to un ...

s, including ** Balance sheet also known as Statement of Financial Position ** Income statement also known as profit and loss statement. ** Statement of changes in equity ** Cash flow statement * Notes to the financial statements * Accounting policies * Independent assurance statements * Other features Other information deemed relevant to stakeholders may be included, such as a report on operations for manufacturing firms or

corporate social responsibility Corporate social responsibility (CSR) is a form of international private business self-regulation which aims to contribute to societal goals of a philanthropic, activist, or charitable nature by engaging in or supporting volunteering or ethicall ...

reports for companies with environmentally or socially sensitive operations. In the case of larger companies, it is usually a sleek, colorful, high-gloss publication. Research has found that annual reports that convey optimistic tone are associated with lower audit fees, suggesting that annual report tone reflects factors that auditors consider in assessing audit risk. The details provided in the report are of use to investors to understand the company's financial position and future direction. The financial statements are usually compiled in compliance with IFRS and/or the domestic GAAP, as well as domestic legislation (e.g. the SOX in the U.S.). In the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., federal district, five ma ...

, a more-detailed version of the report, called a Form 10-K, is submitted to the U.S. Securities and Exchange Commission. A publicly held company may also issue a much more limited version of an annual report, which is known as a "wrap report." A wrap report is a Form 10-K with an annual report cover wrapped around it.

Directors' Role

Statement of Directors' responsibilities for the shareholders' financial statements The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable Law of the Republic of Ireland, including the accounting standards issued by the Accounting Standards Board and published by The Institute of Chartered Accountants. Irish company law requires the directors to prepare financial statements for each financial period which give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing these financial statements, the Directors are required to: * select suitable accounting policies and then apply them consistently * make judgements and estimates that are reasonable and prudent * prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business The directors confirm that they have complied with the above requirements in preparing the financial statements. The directors are responsible for keeping proper books of account that disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements are prepared in accordance with accounting standards generally accepted in Ireland and with Irish statute comprising the Companies Acts 1963 to 2009...

History

In 1903, US Steel published an annual report whose financial accuracy was certified by Price, Waterhouse & Co in what is known as the earliest modern corporate annual report.

'Alternative' annual reports

Certain groups such as The True Cost Of Chevron Network have released 'alternative' annual reports as a way to highlight ongoing environmental destruction and/or human rights abuses committed by a particular company.The True Cost Of Chevron, An Alternative Annual Report, May 2011 http://truecostofchevron.com/2011-alternative-annual-report.pdf Retrieved 19 July 2017

References

External links

How to Efficiently Read an Annual Report
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How to Read a 10-K Like Warren Buffett
by

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