An Annual Report is a comprehensive document prepared and produced annually by companies designed to portray a true and fair view of the company’s annual performance, with audited financial statements prepared in accordance with company law and other regulatory requirements, and also containing other non-financial information.  The Companies Act 1985/89 has published the list of requirement to publish an annual return and it includes:

  • A Balance Sheet
  • Profit & Loss Account
  • A Cash Flow Statement of the company
  • Director’s Report.

The annual report must be prepared with information given in accordance with the rules and standard mentioned as per:

  • Statute law as per Companies Act
  • Accounting standards
  •  Use of Codes for best practice in corporate supremacy
  • Stock Exchange rules

The Companies Act 1985/89 has given mandate that the said annual report must be published within the following time limit since its last day of year end:

  • In case of public company, within 10 months of the year-end; &
  • In case of a private company, within 7 months of the year end

However, the time limit for publication and submission of Annual Reports vary as per each country’s rule. For investment and management companies in accordance with Luxembourg GAAP, the annual and semi-annual report (for a period of six months) must be published within the following time limit with effect from the end of the period to which they relate:

  • Four months in case of annual report;
  • Two months in case of semi-annual report

In USA, all public companies are required to file annual reports within 90 days of the end of the fiscal year. As per government modification of reporting rules in 2002, a company with $75 million to over $700 million in publicly owned shares must file its annual return within 75 days from its last day of its fiscal year. Certain Charitable Organizations who are required to submit annual return, the IRS directs to fill out annual reports within five months of the end of the organization’s fiscal year.

Major Financial Statements Published By a Company

A main Financial Statement of any profit making organization normally include the following four statements. They are

  • Balance Sheet
  • Income Statement
  • Statement of Retained earnings
  • Statement of Cash Flow

Balance Sheet describes what the company owns and what it owes. It describes the economic resources it owns and acknowledges its debt to others along with mention its amount of receivables.

Income Statement describes its revenue expenses, income from every sources, excess or deficit of income over expenditure or amount of profit or loss at the year end.

Statement of Retained earning explains how the amount of income has been reinvested in the company for future growth.

Statement of Cash Flow gives details report of a company’s inflows and outflows of cash and how the company has used its cash in managing debts, paying expenses and purchased assets. The first part of a cash flow statement analyzes a company’s cash flow from net income or losses.

The time limit for publishing for submission of financial statement is same as Annual Report because ‘financial statements’ are parts of “annual reports.”

samir karamkhani