Question

What are the optional elements often included in an annual report?

Answer 1

Optional elements included in an annual report are:

a) Financial highlights- Financial highlights are the gist of the company's performance. Shareholders and companies are often intrested in reading financial highlights. It is often the most read section of an annual report of some companies.

b) Corporate message - Through the corporate message, company shows its potential and relevant information. Generally it includes the company's line of business, management strategies, goals, markets, company's culture, direction. It can be shown through texts, photographs and illustrations. It can be useful to anybody like shareholders, excecutives, analysts etc.

c) Report of management - Report of management is a letter from the board chairperson and chief financial officer taking responsibility of the reliability of financial reporting, effectiveness of operations, and a statement regarding the complaince with SEC and other legal requirement.

d) Letters to stockholders - This is a letter to all the stockholders by the chairperson of the board of directors and the chief excecutive officer or both sometimes. It covers a short analysis and review of the year's events including all problems and successes company had. It also shows the company's direction for the next year.

e) Stockholder information - Stockholder information includes the stockholder service information like the company's corporate office headquarters, the location and time of the next annual stockholders meetings and most importantly list of exchanges on which the company trades its stocks.

f) Board of directors and management - It is a list of names and positions of the company's board od directors and top management team.