It’s that time of year when one is deluged with Annual Reports. Is it just me or have the size of Annual Reports got substantially larger in the last few years? The latest report received is for Spirent Communications (SPT) which is only a mid-sized company (profits last year of £106 million) but the Annual Report spreads to 210 pages – Cover Photo is above. That includes 29 pages for the Remuneration Report alone! Are we really expected to read all of this? When one has a large portfolio such as I have, the volume of reading required is more than can be justified.
Annual Reports are likely to get even longer in future with more ESG reporting being mandated. Some of the detail is important but a lot of it is simple “boiler-plate” stuff. For example the Independent Auditors Report of 10 pages mainly consists of statements such as “We have nothing to report in respect of these matters”. Why do we need telling that?
No doubt auditors love all the work required to put these statements together but the company management must also waste time on putting together such extended Annual Reports – including 4 pages on “stakeholder engagement” in the case of Spirent.
It surely is time to take an axe to these over-voluminous Annual Reports. This could be done by having reporting only on exceptions, or by off-loading non-essential detail to an on-line page. The objective should be to get all Annual Reports down to under 100 pages in size, even for FTSE-100 companies, with small companies as low as 50 pages.
Too much information clouds the picture for any reader and enables important detail to be lost in the welter of trivia.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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