The annual report
A company’s annual report is typically made up of the
audited financial statements and a narrative,
containing management’s description of the
company’s performance and activities. The narrative
part of the annual report is not normally audited.
However, the auditors read the narrative statements
in the annual report to identify any material
inconsistencies with the audited information in the
financial statements. If they find any such
inconsistencies, they will communicate them to
management and those charged with governance.
The financial statements, annual report and other
documents all enable shareholders to understand
how management has performed over the
periods presented.