Technically complex annual reports, concise reports that are no longer concise and a concern to ensure effective communication with shareholders is encouraging more companies to consider simpler reporting options to the traditional annual report.
Reporting to shareholders: A good practice guide, was released today by the Group of 100 (G100), representing chief financial officers of Australia’s largest organisations, and Ernst & Young, in response to the trend of companies communicating with shareholders on financial performance outside statutory reporting.
G100 National President, Tony Reeves, said statutory reports have been growing in size and complexity at a time when today’s market uncertainty means shareholders are demanding simpler, clearer and more easily understood information.
“For some years now Australian companies have been producing non-statutory reports to shareholders including narratives and financial analysis. This publication outlines objectives and guidelines we believe should apply to this abbreviated reporting,” said Mr Reeves.
“Compliance with the guidelines would constitute a minimum threshold of good practice in the preparation of such non-statutory reports.”
Ernst & Young Assurance & Advisory Business Services Managing Partner, Graham Ezzy, said “Improved reporting to support continuous disclosure will help ensure shareholders are better informed.”
“The move to more narrative based reporting which allows Chairmen and CEOs to clearly outline to shareholders in plain language the key developments affecting the company, is an increasing trend” said Mr Ezzy.
Key areas for clear explanation the guide covers include:
The guide is not prescriptive but sets out practical guidance to support the annual shareholder reporting process, with the focus on highlighting material business issues in a consistent manner that is understandable to all shareholders. While the guide deals with annual reporting the principles identified in it are equally relevant to interim, half yearly or other reports.
Reporting to Shareholders – A Good Practice Guide is available online at www.group100.com.au or www.ey.com.au.
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| The Group of 100 385 Bourke Street Melbourne Tel: 03 9606 9661 |
Further information:
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The G100 is an organisation of chief financial officers from Australia’s largest business enterprises with a purpose of advancing Australia’s financial competitiveness. Ernst & Young is one of the leading professional services firms in Australia and globally.
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