Corporate annual reports typically include a narrative section and a financial section. The narrative section is not scrutinized by auditors as the financial section is, yet many readers rely heavily on its graphs to estimate the firm's financial situation. However, the graphs often misrepresent the financial data. To better understand annual report graphs' important role, this article examines more than 25 years of literature related to these four areas: (a) the ways financial graphs are prepared, used, and misinterpreted; (b) differences by country; (c) regulatory influences for accountants; and (d) the parts formatting and media selection decisions play in communication interpretation and persuasion. Across the literature, the author notes consensus that annual report graphs are widely used in many countries and that there is rampant disregard for the guidelines for their accurate, non-misleading presentation. The article concludes with seven proposed directions for future research.
This article examines structural and format changes in annual reports of U.K. listed companies from 1965 to 2004 with a particular focus on graph use. The article compares a new sample of 2004 annual reports with preexisting samples by Lee and by Beattie and Jones. Lee's identified trends continue. There has been a sharp increase in page length, voluntary information, and narrative information, particularly among large listed companies. A detailed analysis of voluntary disclosure indicates changes in the incidence and pattern of generic sections. Graph usage is now universal. However, key financial graph use has slightly declined, replaced by graphs depicting other operating issues. Impression management through selectivity, graphical measurement distortion, and manipulation of the length of time series graphed are common. Overall, annual reports continue to exhibit many features of public relations documents rather than financially driven, statutory documents, and the analysis of graph usage suggests a need for policy guidelines to protect users.
Although business communication relies heavily on the visual, current approaches to graphics and text design are prescriptive and unsystematic. A 12-cell schema of visual coding modes and levels provides a model for describing and evaluating business documents as flexible systems of visual language. Emphasizing clarity and objectivity, the 'information design' movement has generated guidelines for creating functional visual displays. However, visual language in business communication is seldom rhetorically 'neutral' and requires adaptation to the contextual variables of each document, a goal the writer can achieve by com bining visual and verbal planning in the same holistic process.
Bullet points are a popular tool when writing e-mails, memos, and letters. Business writers know they draw attention to important information. Readers like bullet points because they are visually appealing and make it easy to quickly find pertinent information.