Annual report insights 2017
Surveying FTSE reporting
Keeping up with changes in reporting requirements and marketplace best practice is a common challenge for preparers of annual reports, particularly as the needs of the company, regulators, investors and the wider public evolve.
Each year we analyse the annual reports of 100 UK listed companies of different sizes and from different sectors, focusing on current requirements in reporting, the changes coming into force over the next year or so and current regulatory hotspots. The results, together with our insight, help to identify key regulatory challenges and opportunities to enhance your report and avoid potential pitfalls. Watch our short video to find out more!
Brexit, governance reform and Integrated Reporting are impacting multiple areas of UK companies' annual reports. We consider these and other topics, including:
- the relevance of company purpose;
- the value generation story and broader stakeholder engagement;
- the use of Alternative Performance Measures (APMs);
- Nomination and Audit Committee reporting, as well as approaches to the longer term viability statement and risk management disclosures;
- the FRC’s areas of focus in financial statements; and
- latest trends and innovations in corporate reporting including good practice examples.
Are you ready?
‘Failing to plan is planning to fail’ so the old adage goes. The key to a good annual report is planning the process in advance, allowing all necessary parties to be engaged.
It’s now October! For December reporters, where should you be in your 2017/18 plan?
- You could be setting up a planning meeting to agree preparation responsibilities and the overall structure of the report. You can benchmark key aspects of your report to other FTSE companies using the tool below.
How do you compare?
How many pages long is your annual report?
How many principal risks do you disclose?
How many non-financial KPIs do you present in your report?
How many pages long is your accounting policies note?
How many judgements and key sources of estimation uncertainty have you included in your annual report?
Does your report set out how your business creates value for stakeholders other than shareholders?
Although including such information is useful, it is important that the report makes clear why creating value for these groups also helps to create long-term value for shareholders, who are the primary users of the annual report. See the chapter on Business Model in Annual Reports Insights 2017
Does your report show how your KPIs measure the success of your strategy by linking KPIs to the strategy elements they relate to?
This is just one example of the various linkages that can be illustrated by a company in its annual report. Providing clear linkage helps users understand how the various sections of the report fit together as a whole. See the chapter on Alternative Performance Measures in Annual Report Insights 2017.