The annual financial report provides an overview of a company's entire operations over the course of a year. 

The report summarizes financial activity while also including a message from the CEO and projections for the future. 

The annual financial report allows all stakeholders to see what is happening within the company, and may also be submitted to regulatory bodies for external reviews. 

This step by step guide will provide the CFO - or another person responsible for creating the report - with all the steps they need to compile the report

See this video below for an explanation of how state-level organizations construct their annual financial reports.

Explanation of a Comprehensive Annual Financial Report - txcomptroller

Gather financial statements:

Contact accounting department for financial statements

Contact your accounting department and request the latest version of three essential financial statements:

  • Balance sheet
  • Income (profit and loss) statement
  • Cashflow statement

Record the contact details of the individual managing financial statements below and use the email widget below to contact them.

If your team needs help to create those documents you can use our checklists below:

Balance Sheet Statement Preparation Checklist
Income (Profit and Loss) Statement Process
Cash Flow Report

Determine any additional sections of the report

Verify financial data:

Check liabilities plus equity is equal to total assets

In your balance sheet report, check all calculations are correct and everything is accounted for. 

Make sure the value of your liabilities plus equity is equal to your total assets. This should be the final calculation in the process and it allows you to double check the other calculations.

Check retained earnings has been updated

In the income statement, check that the given figure for retained earnings has been updated from the previous year. 

Retained earnings provide you with a figure representing the net income/losses since the foundation of the company. 

Check profit before taxes is present

The result of a successfully completed income statement is understanding your profit before taxes. 

Profit before taxes is calculated by deducting the total operating expenses from gross profit.

Double check this calculation has been done correctly.

Add the increase/decrease to year opening cash balance

In the cash flow report, you need to check that the recorded cash flows are equal to the values recorded within the bank balances. 

You can do this by finding the total calculated increase or decrease of cash and adding it to the opening cash balance at the beginning of the year. 

Then, check the figure corresponds with the actual cash balance at the end of the year. 

These two figures should align, demonstrating the calculations had been done correctly. 

Confirm all figures are correct

After you have completed reviewing all key financial statements, confirm that all figures are accurate. 

Describe the errors that have been identified

Describe the errors in the form field below before contacting the relevant individual to request that they are amended as soon as possible. 

Request errors to be amended

You can record the contact details of the individual managing financial statements and use the email template below to request that the errors be amended as soon as possible. 

Add a section explaining the report's structure

Include a notes section after your financials where you can explain the layout of the reports. 

This area will allow you to add clarity to the financial reports and annotate them where necessary. There may be certain figures you wish to highlight or others you wish to explain. This area provides you with the opportunity to do so. 

Also, consider outlining your methodologies so that when others review the report they can understand how you approached the numbers. 

Letter from the CEO:

Send your CEO the financial overview

Send the CEO of the company the financial reports for review

The CEO should provide a letter to add to the report which covers the performance of the business, market positioning, and achievements over the year.

This annual report from Goldman Sachs contains a video message from the CEO, which you can use as an example.

Add the CEO's letter to the report

After the CEO has sent you their letter, you can include it in your report. The letter from the CEO is often used as the introductory material for the report.

Upload the letter below.

Senior management profiles:

Contact HR for a list of directors and senior management

Reach out to the HR department for a list of directors and senior management. 

These will be the individuals briefly profiled in the report.

You can use the email widget below to contact HR.

Use the sub checklist below to check you have received the right content from HR.

  • 1
    List of names
  • 2
  • 3
    Positions within the company
  • 4
    Brief outline of their roles

Contact each for a brief quote about annual performance

To add a personal touch and a sense of broader company involvement in the report, contact each of those directors and managers for a short quote about the year.

You can use the email widget to send your message.

Plans for the future:

Enter the company's strategic plan

Add the company's strategic plan to the report. 

This should include discussion about the nature of the market and how the company intends to position itself within a changing marketplace. 

Use the upload widget below to add your strategic report.

Add info on new product and services for coming year

Use this section to discuss the performance of existing products and services, taking a critical eye to their relative successes. 

Detail how the products and services you provide may change in the coming year.

Upload your products and services overview below.

Include the accompanying adjusted projections

Add your adjusted financial projections to the report. 

This will allow key stakeholders to understand the expected upcoming performance over the next year, with added information on expected performance over the following years - normally 5 years.

Upload your projections below.

Submit for review:

Pass to a colleague for review and editing assistance

Send your report to a colleague for them to review the report. 

This is an opportunity to work on the editing, layout, and design of the report. 

If you have a design team in the company you can send it to them to create the final copy.

Prepare report

Include a link to the completed report using the form fields of this task.

Obtain signatures from the CEO and CFO

If all parties agree the report is finalized, it needs the signatures of both the CEO and the CFO.

Use the meeting with the CEO to sign the report to finish the creation process. 

Schedule review meeting with CEO

Send your report to the CEO for them to give the final review. 

Schedule a meeting with the CEO to discuss the report and work through any recommendations or feedback. 

Use the email widget to schedule the meeting.

Assign relevant individual to approval task

Ensure all top level management and members of the board of directors have seen and approved the annual financial report. 

One approval is granted from all key parties, the report is finished and ready to be published.

You can take advantage of the role or task assignment feature by selecting the relevant individual to approve the task using the Members form field below.

Approval: Annual financial report

Will be submitted for approval:
  • Prepare report
    Will be submitted

Submit to the relevant regulatory body

If you are a large organization, you may need to submit your report to the relevant regulatory bodies. 

If you are a publicly listed US corporation you will submit to the SEC, using their Form 10-K process. 


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