Frequently asked questions

We have been conducting research and advising companies on reporting for many years – here are a few frequently asked questions. We are happy to help with any other queries you might have, call us or email:

See also the 12 reporting tips

The ‘Big Picture’ reporting questions:

  • Is revealing more information commercial suicide?
    If investors are left guessing about the quality of a company’s performance, the lower its stock valuation. Management doesn't have to give away any trade secrets, but we would encourage them to provide investors with sufficient information to enable an informed assessment of a company’s activities.
  • Is there any economic benefit to transparency?
    Intuitively, you would expect to see a relationship between greater transparency and lower capital costs; the less an investor has to guess about the underlying performance of a business, the higher will be the value placed on a company. Reassuringly, intuition is supported by empirical evidence.
  • Should different companies report different types of information?
    Regulators have become very comfortable with the one-size-fits-all model of reporting, which is a major problem in today’s capital markets. We believe that industry-focused reporting models that reflect an industry’s specific value drivers are likely to emerge.
  • Are we talking about providing more information? Isn’t everyone already overwhelmed with too much information?
    While there may be an overload of financial information, there is clearly a need for more and better non-financial information. Transparent reporting is not about reporting more information. Rather, it's about reporting better, more integrated information that communicates a company’s true value to investors and analysts.
  • Why would we want to lead the way in terms of transparent reporting?
    Because it is a first move competitive advantage – the investment community generally puts pressure on other companies to follow suit. If you agree that industry reporting models are likely to emerge and then lead to new standards for non-financial metrics, shouldn’t you try to influence change before it is imposed?

Strategy reporting:

  • Don’t we all report on strategy already?
    Many companies have improved their reporting on strategy in recent years. But few do it well. Several simply state their strategy up front and then fail to provide a clear link to any other information reported. We encourage companies to show how their strategy is integrated into the whole of their business.
  • What do you mean by Key Performance Indicators?
    Key performance indicators (KPIs) are those measures that the board uses to assess strategic progress and manage the business. Management should not feel compelled to create KPIs to match those reported by their peers. The overriding principle is for the KPIs to be relevant to that particular company.

Market information:

  • We are a niche player, so is it meaningful to talk about ‘our market’?
    Even if you operate in a niche market, the investment community would still like to understand factors shaping your market environment so that they can better understand the quality and sustainability of your performance. In particular, they’re interested in understanding your position within this niche market.
  • Won't talking about the future expose us to litigation?
    Directors often do not talk about the future for fear of potential litigation. However, investors want some indication about future trends – if they are uncertain about a company's direction they are unlikely to feel confident in valuing the stock. Shareholders needs can be met without exposing management to law suits.

Balanced review

  • If I give a balanced view and include the negatives, won't investors focus solely on that...and not give credit for all the positives?
    If investors are presented with just an ‘everything in the garden is rosy’ picture of performance then management may be dismissed as spin merchants – or as duplicitous. Management should ensure that the information provided is objective and balanced, so that investors are not misled as a result of omissions.

Underlying performance

  • If I talk about price and volume, won't it give away the game plan to my competitors?
    Providing information about what is driving revenue and profit growth helps investors to understand whether a company’s performance is down to luck or skill. There may be instances where providing price and volume data may be competitively sensitive. But providing a more consolidated view of what is driving revenue and earnings would be hugely valuable to investors.

Cash flow

  • Do analysts give a hoot about the cash flow statement?
    Both investors and analysts are exceptionally interested in cash flow; they just see the information currently provided by companies as ‘falling short of its true potential’. Quite simply they need more information. The more that investors are left guessing about the quality and sustainability of a company’s performance, the lower will be their valuation of the stock.

Principle risks

  • Don't I have to include the full laundry list of risks to avoid getting sued?
    We understand that companies can be nervous about providing an incomplete list of their possible risks. However, their concerns might be allayed by segmenting their risk section into two: focus on those issues that keep management awake at night, but also provide a description of ‘other risks’. If management remains uncomfortable about segmenting risk reporting in the annual report, then do so in investor briefings.


  • Isn't it commercial suicide to split out more information by segment?
    We recognise commercial sensitivities; and the last thing your investors want you to do is weaken your business by giving away the game plan. Most companies can, however, indicate ranges and key drivers behind their businesses without giving away commercially sensitive information.


  • Can I put non-GAAP information on the face of the primary statements?
    This depends on the territory in which you operate. In the US non GAAP is not allowed on the face of the primaries. However, in the UK, if clearly signposted as non-GAAP, the regulations allow such numbers on the face of the primaries. We suggest that you call your usual PwC contact to discuss or email info@corporatereporting for a specialist in your territory.


  • Surely investors don't want even more information on remuneration?
    No investor wants to see information for information’s sake – however, there is an appetite for greater transparency about executive pay and business performance. Remuneration reporting should always be clear, concise, and relevant as it will be an area of focus for all investors. It’s not about more information but about better, more integrated disclosures and clear presentation.

Clear presentation

  • The annual report is a regulatory document, why does presentation matter?
    The annual report is a chance to communicate with shareholders and provide them with a summary of your company’s progress and performance. Setting out information to support and make sense of regulatory disclosures helps to improve understanding of your business and is likely to make investors more confident in their decision making.