Topic The Annual Report: N.Nickita Devi

Topic =The Annual Report
BY
N.NICKITA DEVI
&
PRASHANT KUMAR JHA
Overview
Any company incorporated under the companies act

1956 are required to keep proper records that reflect
the true and fair view of the company business affair
The economics transaction that the business
undertakes and record them logically in the
database.
Represent the present health of the business.
Enable the management to discharge its obligations
It is help to both management, investor government
and other sectors
Contents
Contents of annual report

Quality of financial reporting
Reporting regulations in India for different types of
entities
Contents of annual report
Annual report consists of various contents which

represent a company’s performance during the
previous year as well as the management’s
discussion of the company’s strategy in the future.
Company's annual report communicate to investor
and analyst.
Basic motive behind the annual report are
1. Tell about the past year performance and the future
performance
2. Report companies financial performance
Contents of the annual report
It differs from one company to other

Optional element include (this is included by most of
the companies)
1. Financial highlights
2. Letter of stockholders
3. Corporate message
4. Board of directors and management
5. Stockholder information.
 The primary securities regulatory body requires.
1. Income statement
2. Balance sheet
3. Cash flow statement
4. Statement of accounting policies
5. Auditors report
6. Management discussion
7. notes to the accounts
8. Selected financial data.
Financial highlights
 This gives a quick summery of a company’s

performance
 It is also the most read section of the annual report.
 Company generally highlight the increase in
consolidated reserves , earning per share and
cumulative dividend growth rate.
Letter to stake holder:-
It may be from chairperson
of the board of directors, chief of executives or both
It includes review of the years event the problem,
issues, and successes the company had
The letter refers to shares owners, employees
Corporate message:-
It always refers how the
company sees itself or how would like others to see it
Board of directors and management:-
list gives the
names and position titles of the company's board of
directors.
Stockholders information:-
Information covers the
basics like corporate office headquarters.
Directors report:-
It is the summary of all the happenings in
the company during the year.
Report management:-
It is issued by the board chair
person and the chief financial officer taking the
validity of the financial information in the annual
report.
Financial statement
This carries the basic set of financial statement.

These statement help the analysts determine the financial
health of the company
Financial statement consist of:-
1. Balance sheet
2. Income statement
3. Statement of cash flow
4. Statement of stake holder’s statement
5. Footnotes
6. Contingencies
7. Supplementary schedule
Statement of shareholders equity:-
This statement
provides information about the changes during the
year in owners interest in the company.
Fixed assets:-
this schedule provides information
regarding break of assets.
Investments:-
provides information regarding break
up of investment.
Deferred tax assets:-

It is the temporary difference
between the recognition of revenue and expense for
taxable purpose and reported income
Sundry debtors:-
sundry debtors are the customer
balance outstanding on the credit sales.
Cash and bank balance:-
Loans and advances:-
Expenses:-
To
NICKITA
DEVI
Quality of financial reporting
It should reflect the clear picture of the company

It should be useful in both assessing the past
performance and predicting the future.
It can be classified into

 Accounting policies, estimates-choice and changes
 Timing of revenue and expense recognition.
Accounting policies, estimates-choice and changes
Makes choices with respect to accounting policies

and makes estimation in the application in there
policies
Any change in the application of the accounting
principals may effect the profit of the company
An accounting change is reported as a separate item
on the income statement, net of taxes.
Company should not change the accounting
standard until that is justified by the companies
economic circumstances
Timing of revenue and expense recognition
The basic principle that provide the foundation for

preparing financial statement is matching principle
Expenses incurred in the current year which relate to
revenue to be generated in a future year cannot be
capitalized because of the constrained contained in
the definition of the asset.
In the recent time there have been many problem
that is faced by the companies due to this issue
Discretionary items
The financial analysis should carefully scrutinize

management policy with respect to discretionary
items
Research and development
Repair and maintenance
Advertising and marketing

Non recurring and non operating items
the financial
analysis needs to analyze the non recurring items to
estimate economic value added earnings
Publicity aspect of reporting:-

the company issue it
to save it self from the sudden collapse and on the
demand of higher transparency by the investor and
MNC
Reporting regulation in India
Accounting policy differ from country to country

Most of the accounting rules are same in commercial
entities all over the world.
There may be different type of entities and discloser
norms that may differ in these entities for ex private
sector, public sector.
Standard of reporting mainly depends on the user of
the financial statement.
THANK YOU

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Topic =The Annual Report

Any company incorporated under the companies act

Contents of annual report

Annual report consists of various contents which

It differs from one company to other

 This gives a quick summery of a company’s

This carries the basic set of financial statement.

Deferred tax assets:-

Cash and bank balance:-

Loans and advances:-

It should reflect the clear picture of the company

It can be classified into

Makes choices with respect to accounting policies

The basic principle that provide the foundation for

The financial analysis should carefully scrutinize

Research and development

Repair and maintenance

Advertising and marketing

Publicity aspect of reporting:-

Accounting policy differ from country to country

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