Drafting an annual report is a challenging endeavor – the reports themselves tend to be long and filled with information, there are many stakeholders that need to provide input into the final product, and there’s just so much that can go wrong.
Luckily, Venngage is here to save you from those mistakes! We’ve compiled the most common errors that we’ve seen in the Comprehensive Financial Annual Report (CAFR) over the years.
1. Not Including a Mission Statement
Just like it sounds, a mission statement is a sentence or two that indicates the purpose of your business and what you hope to accomplish as an organization. It can be pretty difficult to distill everything down into just one to two sentences, but you must do so. This is what your employees should present to other people when they’re asked about their work. It needs to be clear, concise, and represent the company’s values accurately. Organizing your annual report would really help you with this.
2. Using Multiple Fonts
Fonts are one of those areas where you need to be careful because there are many existing fonts and combinations. Fonts have a lot of personalities – are they playful? Serious? Slick? Bold? Different types of font can evoke different emotions depending on what mood you’re setting (your mood changes throughout the day). When it comes to presenting your target annual report, you need to be pretty specific about what mood you’re aiming for. We recommend sticking to two quite similar fonts at most, such as Serif and Sans-serif, etc.
3. Going Overboard With Colors
If you decide to use multiple fonts, don’t make a presentation by using a bunch of different colors as well. Also, you need to be careful that your choice of color doesn’t overshadow the vibe you’re going for. Darker colors tend to have a more formal feel – ex. navy blue, maroon, and silver. Lighter colors are more casual, like lavender, mint green, and lemon yellow. The Apple Annual Report in 2020 is a good example that uses a simple and light design.
4. Not Getting Approvals Ahead of Time
It’s important that you get approval on all of your drafts before printing your final report. Almost everyone is busy nowadays, so it’s important that you give them a chance to look at your work. Thus, they might provide feedback before you move forward. Chances are, you’d send advance emails asking for approval only to be late with edits that could’ve been done earlier. Not good!
5. Using Too Much Stock Photography
The Internet is filled with free images and oftentimes people grab the first one they see when creating a CAFR. No matter how good an image may look in your head or in Photoshop, stock photography can often fall flat. When using stock photography, make sure it fits in with the theme of your report. The Walmart annual report is another example that contains images relating to its content.
6. Not Including a Glossary
A glossary is an area where you can list all of the important words, phrases, and acronyms used throughout the report. It’s important to include a glossary ensuring that your stakeholders are on the same page in using the industry jargon. Everyone knows what “IPO” means, but if you’re writing about intellectual property law, people don’t know the meaning if you won’t clarify.
7. Forgetting About The CEO’s Letter
If you include a mission statement, the CEO’s letter is pretty much a requirement. It gives readers an idea of what your company aims to accomplish and what they can expect in the future. This is definitely one page that indicates how your stakeholders will interpret everything in the document. And of course, make sure the letter matches their expectations! The Tesla Annual Report last year is an example of a report that contains the CEO’s letter and company financial statements.
8. No Conclusion at All
This mistake happens when you forget to include any sort of closure after your report. This is the part where you summarize everything that has been discussed and what your next steps will be as a company. It’s like those school papers where you need to wrap it all up nicely for the reader by providing closure.
The Real Mission of an Annual Report
Remember that when writing an annual report, it’s a chance to convince people that your company is doing well, and will be even in the future. This means taking extra care with every word on the page (even before you publish it). When in doubt, get help from someone who knows what they’re doing.
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