Components of the Annual Report
Concept of Annual Report
➦ An annual report is a comprehensive report on a company’s activities throughout the preceding year.
➦ Annual reports are intended to give shareholders and other interested people information about the company’s activities and financial performance.
➦ Components of the annual report consists of various things. The annual report is a financial document published by most private and public companies to summarize the major transactions of the year.
➦ The report usually begins with a letter from the Chairman of the Board and/or the Chief Executive Officer.
➦ It also includes the balance sheet, income statement and the cash flow statement as well as a discussion of company affairs and notes to the financial statements.
➦ Public corporations are required to provide shareholders with an annual report describing their operations and financial situation each year.
➦ An annual report’s front page usually consists of graphics, photos, and a narrative summarizing the company’s activities over the past year and making predictions for the future.
➦ The report includes detailed financial and operational information at the back. The purpose of the required annual report is to provide the public with information about a company’s operating and financial activities over the past year.
➦ Shareholders and other stakeholders typically use the report to evaluate the firm’s financial performance and to make investment decisions.
➦ A company’s annual report will tell you how it achieved this growth, what its strategy was, and whether this performance will last.
➦ Annual reports provide qualitative information that is crucial when making investment decisions.
➦ If the annual report is still not filed after a certain period of time, the jurisdiction will revoke your company’s good standing or put it into forfeiture.
➦ In addition to the past due annual report, most states require a certificate of reinstatement and additional fees.
➦ Several companies can prepare sections of your annual report. Alternatively, you may have an attorney prepare the report and file it with the state on your behalf.
➦ You can purchase accounting software to assist with the financial aspects of your report if you choose to do some of the work yourself.
➦ The joint stock companies publicly owned and listed on a stock exchange are required to prepare and publish an annual report for its shareholders.
➦ In Nepal, the privately owned companies are also required by the Companies Act, 2053 BS to prepare an annual report and submit it to the Office of the Registrar of Companies.