ANNUAL REPORT
An annual report is a document used to disclose corporation information to shareholders—a state-of-the-company report. All U.S. companies that issue publicly traded stock are required to file an annual report with the Securities and Exchange Commission (SEC). The document that is filed with the SEC is the Form 10-K.
Many nonprofit organizations, foundations, and charities produce annual reports to assess their performance. Nonprofit annual reports include the following sections (Figures 7–11):
Letter from the chairman of the board
A description of the charity, its causes, actions, and accomplishments for the year
The financial statement:
A letter from the organization’s CPA
Income statement
Balance sheet
A list of directors and officers
If a company is privately owned but has more than 500 shareholders and over $10 million in assets, it is also required to file an annual report.
In addition to Form 10-K annual reports, the same mandated corporations must also file a quarterly Form 10-Q as a quarterly report.
The annual reports required by the SEC follow a strict format and include the following sections (Figures 7–11):
Business overview
Risk factors
Unresolved staff comments
Properties
Legal proceedings
Submission of matters to a vote by shareholders
Market for the company’s common equity
Related stockholder matters
Management’s discussion and analysis of financial conditions and the results of operations
Disclosures about market risk
Financial statements and supplementary data
Changes in accounting
Controls and procedures
Other information
Directors, executive officers, and corporate governance
Executive compensation
Security ownership of stock by management and certain beneficial owners
Relationships and related transaction and director independence
Accounting fees and services
Exhibits and financial statement schedules
Figure 7 Annual Report Cover Page
(Courtesy of the U.S. Securities and Exchange Commission)
Figure 8 Annual Report Table of Contents
(Courtesy of the U.S. Securities and Exchange Commission)
Figure 9 Annual Report Letter from the Chairman
(Courtesy of the U.S. Securities and Exchange Commission)
Figure 10 Annual Report Organizational Overview
(Courtesy of the U.S. Securities and Exchange Commission)
Figure 11 Annual Report Overview of Organization’s Performance
(Courtesy of the U.S. Securities and Exchange Commission)