Stock Market Investors » Glossary of Stock Terms » What is an Annual Report?

What is an Annual Report?

By law all companies that are traded publicly are required to issue an annual report. The SEC requires the issuance of such a report each year and it should be provided to all the shareholders. The annual report includes information on the financial results the company has achieved throughout the fiscal year.

Many companies use annual reports as a way to state the positive results that have been achieved by the company's management team. As a result, you can often find information on problems that have been experienced by the company in the footnotes.

In order to guarantee for the validity of the annual report an accredited accounting firm examines the report. If the report corresponds to the actual condition of the company the accounting form certifies the validity of the annual report.

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