Companies spend a great deal of effort developing their annual reports. Investors, whether experienced or not, look to these reports for background on the company and the progress that it’s making. There are multiple elements that go into making these reports accessible to readers. Annual reports are broken down into two very distinct segments.
First, a narrative piece describes the background and goals of the company with colorful language and pictures. Next, charts and graphs provide a complete financial overview for the company. These two portions of the reports are used to draw upon multiple levels of education, learning types, emotions, and tastes to bring an extremely diverse audience onto one single playing field. The company does this by analyzing its audience, the linguistics, content, design and structure.
A company must be extremely cautious when composing the literature of its annual report. As a publicly viewed document, read by first-time investors or professionals, the report must be written to appeal to an audience with varying levels of education. The sole purpose of the narrative portion of the document is to educate the reader on the background and mission of the company. The writer must therefore assume that his audience is uneducated about these things. All difficult concepts must be explained in great detail, in extremely simplistic terms so as not to confuse the reader.
Otherwise, if the language overshoots the knowledge of its reader with complicated terms and concepts, a potential customer is lost. After reviewing several reports such as Wal-
Mart and Microsoft, I failed to find any language in the narrative portions that was completely over my head. Every analysis of a product or a business plan was explained in

simple terms and in great detail, allowing me to fully grasp the essence every topic. In contrast, the financial section of the report is catered to a more advanced audience, usually professionals, or individuals with investment experience. In this portion of the report, the company can use language that would normally be over-the-heads of the general public. Wal-Mart’s financial analysis included sentences packed with complicated terms that average customers would not understand, “In years prior to adoption, the Company recorded amortization expense related to goodwill” (18). Having a narrative portion followed by a financial portion to the report increases the number of readers that will be able to follow the message behind it. It is beneficial for a business to have the opportunity to develop literature that can please all members of their audience.
The language of the annual report is even more valuable in the fact that it can evoke emotion within the reader. This is vital for the company because it stimulates an interest in the customer and creates excitement about them potentially making an investment. The text invites the reader to become a part of the “family” that is composed of other investors, employees and executives. Certain linguistic features can create the image of real people, just like them, being touched by the company, which in turn, makes the reader want that feeling too. For example, using the first person in the annual report is the first step in making the reader feel comfortable with the company. The company may have franchises located in countless cities all over the world and thousands of employees, investors, and executives like Wal-Mart for instance. Wal-Mart uses phrases in their annual report such as “we are committed” and “our efforts,” which allows their reader to feel that the company, as spread out as it is, is still a collective unit with the same goals and aspirations (2). Starbucks even goes as far as addressing the customer directly in the

very beginning lines of the report, “the inviting cup warms your hand. With your very first sip, the day feels brighter. Your morning treat” (2). Acknowledging the customer within the report that is geared specifically for them is a brilliant method. Using the active voice in the annual report is also a great technique used. Expressing ideas in this form demonstrates to the reader that the company is focused on forward movement and working towards the future. An example from Starbucks’ annual report demonstrates the positive outlook that is expressed through the active voice, “All of these efforts help us create a strong connection between people-the human connection that represents the best of Starbucks, the best of each of us” (4). Keeping the audience, their emotions, and educational background in mind, the linguistic features of the annual reports are crucial to consider.
Content is the most essential part of the annual report. It allows the consumer to generate an opinion based what they read and what they see. Therefore, the contents of the document need to induce positive emotions within the consumer to encourage them to invest. Without solid facts, quotes and statistics to inform the consumer, the whole concept of the annual report is pointless. A company could essentially have a report filled with worthless statements claiming that it is successful, but in all honesty, a customer can’t really rely on this. However, pictures, charts, graphs, and statistics can provide the customer with proof that these types of statements are indeed true. Starbucks successfully integrates statistics into their descriptions, “This philosophy seems to work-last year, we were named one of Fortune magazine’s “100 Best Companies to Work For. It’s the seventh time we have been honored with this recognition” (8). In addition, it’s extremely important for the company to integrate quotes into the text from customers, executives, or

anyone who has been affected by the company. This evokes emotion within the consumer and promotes the human aspect of the company. It also demonstrates that the average customer can invest in the product and benefit from it. Lee Scott, the President of Wal-
Mart, stated in Wal-Mart’s report in regards to Hurricane Katrina,
“during this time, we were asked by governments, relief agencies and communities to help. And look what happened. We were showered with gratitude, kindness, and acknowledgements. This
WAS Wal-Mart at its best” (10). A quote from the President of the company integrated into the report demonstrates that the company is capable of relating to their customers on a personal level. Even with all of the facts, quotes, and statistics incorporated into the document, the company still must keep the content of the report as positive as possible. If there are currently problems within the company, it’s important to continue a positive outlook throughout the report. For example, a company may have experienced a dramatic loss in sales because of a natural disaster. Using positive language to discuss this setback is extremely crucial in recruiting customers. Any signs of negativity will cause consumers to reevaluate their decision to invest in the company.
Similar to other elements of the annual reports, content has the ability to evoke emotion within the consumer, which makes it the most crucial element for the companies to consider.
The vivid imaginations of the company can be expressed through the design element of the annual report. This element finally allows the company to express its creativity through pictures, charts, vibrant colors, and bold words. Keeping in mind the different tastes of its readers, however, the company must create a document that is appealing on several different levels. The layout should be designed to attract the reader beyond the elaborate descriptions and actually make them feel connected to the company.

Impressing the reader and grabbing their attention is the company’s first priority. Certain techniques, such as pictures and graphics, allow the reader to understand complex concepts without the terminology having to be simplified. The aspect of design allows the company to cater to some consumers who learn differently than others. Many readers can grasp concepts by simply reading paragraphs of information. Some, however, are more visual learners; therefore the charts, graphs, and pictures allow them to connect more with the information that is being provided. Visual elements bring more clarity to these readers than a paragraph full of text. Charts and graphs state information directly and specifically and they are usually easy for anyone to comprehend. Graphics and photos add life to the document, helping the reader realize that real people just like them can be impacted by the company on a positive level. For example, Starbucks’ annual report contains countless pictures of employees, new drinks, customers sipping on steaming cups of coffee, and many other images that the reader is instantly drawn to. Even more captivating photos appear on the cover page of McDonalds’ annual report in the form of a giant sized hamburger and fries. These images immediately grab the reader’s attention, much like many other design aspects, such as color and bold or oversized wording.
Color and bold print draw the eyes of a customer to a page before anything else. For instance, in the McDonald’s annual report, the familiar, vibrant red on the box of fries caught my attention right away. After being attracted by color, the next interesting element that most readers will find on a page is bold or oversized print. Large, bolded words are crucial because they attract the reader’s attention to important words right away. Once the customer is hooked because of graphics, charts, colors, or large prints, the company can then begin to focus on the real task at hand, educating the customer. These design

elements also allow the company to cater to different learning types while still adding some creativity into the piece.
The general flow of the annual report is a subtle importance, but a crucial one none the less. The structure of the document caters to the more visual learner, just as the design element does. For example, annual reports usually contain headings and sub headings to briefly introduce the reader to the topic. This way, if the reader is just looking for a specific topic in the report, it’s much easier for them to skim through it and find what they need. Transitions techniques are also catered towards the visual reader.
Pictures, bold or oversized fonts, or graphics are used to transition between topics. Within these topic areas, paragraphs and sentences are fairly brief in order hold the interest of the reader. If explanations are too long, the reader is lost within the complexity of the text.
Headings, transitions, and brief explanations provide convenience for the reader, which is why the element of structure is so important.
To compose an impressive annual report, companies should cater to their audience. In order to do this, they must be aware of the linguistics, content, design and structure of their document. The company can then draw upon the multiple levels of education, learning types, emotions, and tastes of its audience to bring this extremely diverse group onto one single playing field. Analyzing these elements and discovering the consumer’s desires is the only way that a company can truly cater to its reader.
This is very strong work! You are obviously a talented writer. You have taken on a topic that a lot of people would find a bit dry and written an incisive and engaging piece.
Grade: √+

Works Cited:
Wal-Mart’s Annual Report 2006
Starbucks Annual Report 2005