Moneo writes: Full disclosure, not smoke and mirrors

It’s that time of year again when we start seeing the annual reports from our professional bodies. In the past I have commented about the potential for good that these reports can bring but that so often they are a missed opportunity in that they are used as a marketing tool rather than a vehicle to relay good information. While I do not intend this year to name and shame the authors of the annual reports I would like to take some time reflecting on at least one of the reports.

I often read in financial columns about companies with multi-million pound turnovers who, despite having a massive turnover are actually really poor performers as they do not realise any profit at all and often end up declaring bankruptcy. The point here is that it is not the turnover that reflects the success of the business but the profit. Companies that are reluctant to publish their profits often fill me with suspicion as they more often than not are attempting to hide failure or shortcomings by making their activity look better than it is. The same could be said of an annual report that merely tells us how busy the organisation has been in the previous year without telling us whether any of that activity has actually yielded results or not. What I want to see in an annual report are the outcomes against the targets set for the year in the previous report.