05 December 2016

Reporting Excellence

Reporting has made a significant move in the last couple of years towards simplifying and enhancing content. Recent changes and trends have supported this through the removal of duplication, the simplification of financials, more focus on communicating strategy, and guidance around the preparation of the Operating and Financial Review.

These reporting developments all aid in enhanced communication with investors and other stakeholders. Rather than just ticking regulatory boxes, reports are better able to inform, influence and educate readers and build the investor brand.

Three components of reporting that have seen change are:

1. Corporate Governance
Listed entities are no longer required to publish their full corporate governance statements in their Annual Report. An entity can now choose to provide its full Corporate Governance Statement (CGS) purely on the corporate website. If not included in the Annual Report, the CGS must be given to the ASX as a separate document at the same time as the Annual Report and meet certain reporting requirements.

2. Operating and Financial Review (OFR)
The adoption of OFR reporting (per ASIC RG247) by listed entities is on the uptake. It’s an opportunity to help readers understand how the company performed in financial and operational terms, its strategy, major risks and mitigation strategies, and outlook.

Ideally, the financial review section won’t use extensive accounting analysis and financial tables similar to the financial report. Instead, the OFR should serve to succinctly, clearly and analytically explain the drivers of your business and financial result by using content from your post-results presentation to analysts, investors and media as source information for an engaging OFR.

3. Strategy
The articulation of your corporate strategy remains a key part of clear corporate communications. It’s an essential element of the OFR that, along with your sustainable competitive advantage and corporate vision and values, generates investor affinity and understanding of where the business is headed, and confidence in your corporate story and investor brand. Use info-graphics to enhance its presentation, review how well you executed it in the past year, and present your broad plans for the upcoming year(s).