The use of visual aids (e.g. pictures, charts, schematics etc.) is a powerful way to convey key messages but it is important to get the balance right. In general, imagery should be relevant to the content and key messages of the annual report and accounts. Too many images may make the document too elaborate. Too few leave the document text heavy and unlikely to draw the reader in. Any photography should be captioned to explain its relevance.

Graphs, tables and charts should be used where possible to illustrate figures and these should be clearly labelled.

Here are some reports Comfi has made in order to illustrate this:

Front cover

While the design on the front cover should make someone want to pick up the report, it should also have a purpose. For example, use an image or strap line to illustrate a key strength or message.

Layout

Not all shareholders have time to review an annual report in detail; good use of bullets, short paragraphs, highlighted text, visual aides, graphics etc. that facilitate access to the information are to be encouraged. Most shareholders browse thorough the annual report, so critical information should be signposted, using quotes, boxed sections and colour to bring key messages to the reader’s attention. Font size should be easily readable, line lengths not too long with the text laid out in columns.

Here are 10 practical suggestions to help shareholders:

1. make sure contact details and web address are clearly visible in a logical place – e.g on the back cover. Provide a list of on-line links or other publications if necessary;
2. make sure the date on the front cover makes it clear which year end is being covered – e.g. 31 March 2011;
3. put company name and year end on the spine for easy reference when filed;
4. put company name and year end on every page in case individual pages are copied – particularly relevant when increasing use is made of online PDF copies;
5. make sure it is clear which section you are in;
6. make sure you adequately highlight the current year in text and tables;
7. don’t bind the invitation to the annual general meeting invitation and resolutions into the main report and accounts as shareholders may not notice it. If you do, make sure it is well signposted;
8. relevant reports and directors’ statements should be signed (and accompanied by photos where suitable) to demonstrate ownership and accountability;
9. differentiate the accounts section from the rest of the report so that readers can turn to it easily – e.g. use different colour, stock or a clear tabulation etc;
10. use dark tints sparingly as text can be difficult to read and impossible to photocopy.

According to a survey conducted by Forbes Magazine,  the printed annual report was rated top of 38 sources of information valued by investors . . . . . . while the web is the most used source of information for investors.

Readers don’t mind if they get it via the internet or via paper, the only thing we have to fear is . . boring reading.”

Start at the top. Begin the annual report with a letter or column from an organizational leader (chairman of the board, president or CEO). The executive’s message should provide an overview of the year’s activities and accomplishments. It should also summarize the financial performance in terms a general reader can understand. Where the chairman and the CEO have separate letters, divide out the messages. Consider a single letter ‘from the Chairman and the CEO’.

Studies suggest that readers consult as a priority the chairman’s letter! The most important elements of the story need to be in this section, including a reference to basic strategy. Strategy is the manifestation of the will of the managers, of their personality, values and aspirations.

Give credit where due. Include recognition for outstanding performance leadership and key staff members in for-profit organizations, or donors and volunteers in non-profit organizations.

Use a corporate message on the cover that increases the credibility of and interest in the company for the target groups. To produce a trustworthy perception and reputation that bolsters stakeholder support for the company, start the corporate story on the cover of the report.

Use a creative concept  with stopping power to strengthen your message and reputation. Use this on the cover and at the start of each chapter and use it as red line throughout the report.

• Make sure the key messages reflect the current and long-term concerns of analysts, shareholders, employees and other stakeholders as well as internal views and use this to guide the structure and content.
• Key financials, compared with the previous three or four years, and any other events that give the reader a quick summary of business performance should be communicated in one of the opening pages.
• As breadth and depth of management are considered key critical success factors by shareholders, biographies of the executive and non-executive directors are essential.
• Investors expect to find the detail on operational performance at divisional, market and geographic sector level in the annual report plus greater detail on financial performance.
• While a company has little choice as to the amount and type of financial information it has to disclose, it can determine what interpretation it presents to outside world, in particular ‘difficult’ material. Do not leave major items (falling cash flow, rising debt ratio) unexplained. It is vital to give the impression of being in financial control and not trying to sweep anything under the carpet.
• Do not use jargon or buzz words and uses either footnotes or a glossary if technical terms or acronyms need to be used.
• More generally, it is important to increase analysts’ understanding of what is driving sales, margins and costs. What are the five or six things your company has to get right in order to survive and prosper?
• As well as contact details for queries on dividends, share transfers, voting etc, the report should include a section that provides a history of the share price and dividend performance.
• In general, senior executive remuneration should be broken down into its fixed and variable components, with a reasonably detailed explanation of how the variable component is defined.
• The annual report should include an adequately full description of the key sustainability issues for the Group together with summary of key performance in these fields. Cross-references to other, more substantial materials, whether on-line or in other printed materials, should be included.

Many parts make up the design of an annual report: the cover, the choice of paper and binding, the amount and choice of colour, the design of charts and graphs, and the fonts used. All of these work together to build an annual report that represents your company. No matter what your budget or how many copies you print, you and your communication agency can together come up with can design an attractive report that suits your needs.

Binding and Cover
Binding has a big impact on the cost of printing an annual report, so your budget may partly dictate your choices. Saddle stitching is an inexpensive binding but is not meant for more than 60 to 80 pages. Keep an eye on weight: postage is becoming increasingly expensive: it can cost as much to mail a report as it does to print it!

Paper
Choose a paper that is as lightweight as possible without compromising colour quality or photocopiability. Using PEFC-certified paper helps give a positive environmental message. Some glossy paper+print combinations have a strong odour for several weeks and are best avoided.

Typography
Choice of typefaces can add the crowning touch to a great design. There are a number of basic rules which any good agency knows: choose one or two fonts: a good start is to find a serif and a sans serif font that look good together. Start with the body text and the main headings for each section. Smaller heads should be the same font as the main heading or the body text, though maybe bold where the body is regular. Rather than choosing a different font for captions or charts, vary the weight or size of one of the fonts you’re already using. Make sure that the colours of the text and the charts match. Put thought into the design of the pages: the size of the margins, placement of page numbers, and the use of white space. Starting chapters by placing white space at the top of the first page will help the reader find each chapter easily.

Charts and Illustrations
A good design spaces charts and illustrations throughout the report, rather than placing them all together in one section. Give them a unified look by using a similar colour treatment and similar fonts. Choose the type of chart that best displays the data but represents it in an attractive and readable way. If you are showing statistics of your customer base as a percentage of the whole, use a pie chart. If you are showing a progression of income or sales over time, a bar or line chart is a good choice. If you make the pie chart have a three-dimensional look, give that same look to the bar chart, and use the same font for the labels, something easy to read. Label data with numbers as well as using a scale on each chart: put the value of each bar at the top of that bar and the size of each slice of the pie in the label for that part of the chart.

Tips and Advice
The overall look of the annual report should fit the company, its image, audience and product. The annual report for a brewery will look different from that of a mining company. Consider aligning the colour scheme with that of your company logo. Include also product logos. In today’s business environment, values are as important as product. So include photos which represent your team values (teamwork, multi-racialism, attention to detail) as well as your products.