Explaining the performance of a business is the primary objective of the annual report. It’s typically front-page news in the ‘highlights’ section. The problem is there is a lack of consensus about what metrics to use to measure performance. Many companies in the FTSE 350 use adjusted numbers drawn from the financial statements. There are new requirements in the UK that are aimed at increasing transparency and consistency in how companies report adjusted financial metrics.
In our review of reporting across the FTSE 350 we found there is considerable room for improvement. Whilst there is a compelling case to support the use of adjusted numbers and investors have made it clear that they find them highly relevant, there is work to be done to communicate why certain numbers have been used in preference of statutory numbers and how they have been calculated. Getting some consistency in how and where information is presented in the annual report would be a good place to start.
To read more, please download the full white paper below. If you would like to speak to us about how we can help you communicate and present your alternative performance measures, please contact our Business Development Manager, Mitchell Kirkham-Cooper on email@example.com