Annual Reports - a Missed Opportunity For Charities: Deloitte

A survey by Deloitte of UK charities’ annual reports shows key opportunities to communicate with stakeholders are being missed, with annual reports ‘impenetrable’ to readers.

In the UK, charities are required by law to submit annual reports the Charity Commission in line with the Charities Statement of Recommended Practice (SORP).

In surveying 50 annual reports from 1,000 of the UK’s largest charities for Surveying the Sector, Deloitte found that the majority of charities complied with the letter of the regulatory requirements, but not necessarily the spirit of the SORP.

In other words, most organisations met the reporting requirements, but missed a valuable opportunity to communicate with stakeholders.

The survey found that the visual appearance of reports made them impenetrable with the vast majority consisting of long sections of unbroken text. Only a quarter (24%) of reports used one or more graphs to aid the reader, and 20% of reports were judged to be ‘visually stimulating’.

Mary Reilly, head of Deloitte’s third sector practise, says the annual report is the first port of call for a range of stakeholders looking for detailed information about the purpose of the charity, what is has achieved and its plans for the future.

Reilly says charities need to do more to communicate to donors and other stakeholders such as the wider public sector, particularly in light of the current economic conditions.

Reilly says that many organisations see their annual report as a matter of compliance, and are missing the bigger opportunities it provides.

She says charities rely on donors as business relies on investors, but there simply isn’t the same attention to detail.

See the full Surveying the Sector report (PDF) at  www.deloitte.com