Finances have always been a vital resource for us. That is why we work hard to generate enough income, or better yet, more than enough. However, merely keeping track of the cash inflow will not suffice. As a business owner, you also have to take into account other financial activities that result in disbursing cash from the company. And most importantly, always remember to keep a record of these. Why? Because by the end of the year, you must create an annual report. This guide centers on the basics of a yearly report to help you prepare one for your organization.

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What Is an Annual Report?

A corporate annual report is a comprehensive document or publication provided by corporate entities, which details their financial activities and achievements. Organizations write a business annual report or a nonprofit annual report to provide it to the shareholders. In some cases, it includes infographics for a more understandable presentation of the company’s operations and financial performance. According to Investopedia, the front part of a creative annual report narrates the corporation’s activities through graphics and photos. Meanwhile, the back part includes a more detailed discussion of such.

How to Write an Annual Report

An excellent annual report helps convey to the shareholders and a specific group of people the transparency and accountability of a company. Creating one would be possible with the help of a simple annual report template. This way, you wouldn’t have to spend a lot of time coming up with an effective annual report layout. But if you need a guide in writing one, read on.

1. Plan in Advance

An annual report design consists of countless data and other information, knowing that it covers one year of the business’s operations. That is why it is crucial not just to keep track but also to keep a record of the company’s transactions, business achievements, and other necessary numerical figures. Keeping other resources such as media clippings and photographs that document a corporation’s activities is also vital. With so much to compile, it is best to plan in advance.

2. Know What to Highlight

Annual reports are not just about informing the audience of your activities for the past year. It opens doors for you to highlight your company’s achievements and its impact. Doing so enables your investors and shareholders to know how close you are in achieving your goals and overall objectives. That said, you can gain more of their trust and foster long-term connections.

3. Map Out the Content

Now that you have determined the key message you would convey to the investors and shareholders, it is time to sort the information you will present. Make sure to know what you should include what you should not. Bear in mind that an annual report should tell a story of a business’s overall structure and include an introduction, chairman’s letter, and financial report.

4. Make It Compelling

A compelling and well-designed yearly report can be an effective marketing tool for your business. For this reason, you have to make your design visually pleasing and, at the same time, professional. To do this, use photographs, design infographics, and create charts. Other than that, you should also keep your text simple and direct to the point. When the information is very vital, use textboxes or quotes to emphasize.

FAQs

What are the main elements of an annual report?

Following are the main elements of an annual report:

What is the purpose of creating an annual report?

The purpose of writing an annual report is to summarize information relating to a company’s achievements in the past year. Other than that, its use also involves meeting the legal requirements and stating the financial performance and goals of a company. A well-written annual report will also serve as a tool to inform shareholders and investors of the financial activities and performance of a company.

Who prepares the annual report of a company?

Professionals from the management level are the ones who prepare the annual report. They then submit or present the document to shareholders, stakeholders, employees, unions, and regulators.

Data from Statista showed that the total consolidated net revenue of Amazon reached over $280 billion last 2019. By merely taking a look at the company’s revenue, we can conclude that it is dominating the market. Your company may not be as big as Amazon, but noting its accomplishments and recording its activities is still mandatory. As you face challenges and overcome them, keep a record of it as you have to complete an annual report by the end of the year.

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