How to create non-profit reports that turn numbers into narratives
Groans often outnumber cheers when annual report season rolls around. But despite rules for what the reports must include, there’s no rule about making them boring.
Forget dull governance documents destined to gather dust. Annual reports are an opportunity to showcase achievements and impact in an engaging, readable and memorable way.
Australian law requires that certain organisations submit annual reports. This article explains how to create not-for-profit annual reports that drive donations and grants, attract volunteers and staff, and build a community of supporters.
What is an annual report?
An annual report is a publication detailing an organisation’s performance over the past year.
Standard sections include financial performance, governance – how an organisation is managed, controlled and held accountable – and operations. The report will cover the ins and outs of an organisation’s programs and services, as well as its successes, challenges and future goals.
The report’s purpose is to inform stakeholders – such as clients, members, donors, funding bodies and relevant government agencies – how the organisation is tracking against its mission and goals and how effectively it’s using its resources.
Who needs to produce an annual report in Australia?
It depends on the type of organisation and where it operates.
Public and large proprietary companies, as well as certain public sector agencies, must produce annual financial reports.
The Australian Charities and Not-for-profits Commission (ACNC) requires registered charities to submit an annual information statement. Medium and large charities must also submit an annual financial report.
While not legally required to do so, some private Australian social enterprises publish annual reports to show transparency and accountability to their investors and supporters.
Annual reporting rules for Australian not-for-profits
Requirements for annual reporting in Australia depend on a non-profit’s size as defined by the ACNC.
- Small charities are those with revenue less than $500,000.
- Medium charities have revenue between $500,000 and $3 million.
- Large charities have revenue of $3 million or more.
Annual information statement
Registered Australian charities must submit an annual information statement (AIS). It contains non-financial information including:
- the charity’s activities
- who benefits from their work
- governance details such as leadership structure, decision-making processes, risk management, strategic direction and policy implementation.
The statement helps show compliance and transparency.
Annual financial report
Medium and large charities must submit a financial report together with the AIS. This report includes detailed financial statements including profit and loss, balance sheet, cash flow and explanatory notes.
Large charities must have their financial report externally audited. Medium charities can choose between a comprehensive audit or a simpler, less expensive review. Either way, an independent, accredited auditor must do the review or audit.
The organisation’s board then signs off on the audit or review before it goes into the annual report.
Elements of an effective non-profit annual report
The best annual reports include:
- a theme or narrative thread to tie the report together
- measurement and reporting on what you did and the difference you made
- clear reporting on finances and how funds were spent
- communication of purpose, activities and impact
- case studies bringing impact to life through ethical storytelling
- information in a variety of formats including infographics, charts, photos and videos for digital reports
- clear goals and future direction
- acknowledgement of key stakeholders, donors, funding agencies and partners
- compliance with relevant governance and reporting standards
- accessible and inclusive language minus the jargon.
Not-for-profit challenges when preparing annual reports
Producing an annual report is a large investment in time and money. This cost is difficult to justify if only a handful of people ever read it. So, if your organisation must produce an annual report, ensure every dollar spent on the publication counts towards your mission.
Thorough planning, clear lines of responsibility and manageable deadlines will make the process smoother. Using templates or outsourcing all or part of the report are other ways to ease your workload and keep what can be a daunting project on track.
Include calls to action encouraging people to support the work they are reading about by donating or volunteering.
Think about what you want the report to achieve beyond ticking the governance box.
Gather your annual report team
Having one person as the project manager keeps things tidy. If you choose to keep your annual report in house, this person may need to put their ‘business as usual’ on the back-burner.
They will be planning the report, delegating tasks, gaining necessary approvals, mediating the amends process, overseeing production and making sure it all comes together by deadline.
They may also write the report or edit of the source material to ensure the final publication uses a consistent tone and style.
The project manager will also need to clarify the approval process, including who will review and approve the:
- overall plan
- various sections
- design
- final content.
Finally, choose a few people willing to proofread the final document before it goes live. Depending on the size of your organisation this could be communications or marketing team members, volunteers from other areas of the organisation or an external specialist.
When to outsource your report
Assess the size and expertise of your team, their workload and the reputational risk profile of your report’s content. Would external support benefit your process?
External, independent suppliers bring fresh perspectives and objective input. Since they aren’t involved in daily operations, they’ll ask questions and examine things often taken for granted or overlooked. They are also well-placed to sidestep any internal politics.
Roles that are helpful to outsource include:
- project management
- graphic design
- accessible document design
- subject expert and client interviews
- content writing
- structural editing and proofreading.
Preparing a brief for suppliers
The project manager is the conduit between the departments contributing source material and the team pulling it together. When briefing external suppliers, let them know:
- your expectations for the report
- the report format and size, including any shift from previous years’ reports
- the theme
- a summary of the project scope
- the state of source material with sample copy to assess editing needs
- if they will need to do research and interviews
- the page plan
- the project timeline and deadlines
- if you have a branding and style guide
- who will be the internal point of contact, including business hours availability.
Deciding your timeline
It’s common to present annual reports at an organisation’s annual general meeting. This makes the AGM a helpful deadline.
If not the AGM, are there any other deadlines the annual report must be ready for? Start there and work back, keeping in mind that larger publications can take nine months from planning to distribution.
For organisations that must submit a financial report, your end of financial year (EOFY) is another crucial date to consider in setting out a production timeline.
Here’s a typical timeline .
- Start planning the theme, format and content, building your team and gaining executive approval four months before EOFY.
- Content writing (including amends, editing, proofreading and executive approval) and design one to two months on either side of EOFY.
- Print or digital production two to three months after EOFY.
- Distribution and promotion three to four months after EOFY.
Allow time to evaluate the report and make notes to improve the process and the publication next time.
Hot tip: things always takes longer than expected. The CEO might be late with their report or the auditor is still assessing the financials. Add an extra time buffer if you can.
Choose a theme
What’s your report’s theme? This question is frequently met with confusion or silence. Choosing a fresh theme for your annual report will assist your planning. It helps clarify what to include, what to emphasise and how to present it, and acts as a helpful starting point for the executive and chairperson statements. A theme also assists the graphic designer and content writer working on the project by clarifying which information to highlight.
The theme weaves in your report’s dominant message. It binds your various activities, operations, achievements and plans under a common purpose. A well-chosen theme supports your organisation’s big picture and helps readers make sense of the different areas you are reporting on.
It could pick up on a major achievement from the past year or the strategic direction you’re working towards. It could be aspirational or grounded in impact. Your theme could simply be a version of your organisation’s mission.
What to include in your content plan
Your organisation and its goals will guide your content plan. Following are commonly used sections to keep in mind.
- A cover photo or design that captures your theme.
- An Acknowledgement of Country paying respect to the First Peoples of the land where you operate.
- Table of contents to make larger reports easier to navigate.
- What you stand for through your mission, vision and values.
- Impact summary or scorecard highlighting important performance results for the year.
- Organisation snapshot presenting the facts and figures around who you are, what you do and where you do it.
- Highlights of any organisational milestones achieved during the year.
- Any awards or other recognition of your work and impact.
- Executive and chair reports summarising the year’s achievements, challenges and future direction.
- Details of board members and senior staff, including photos, qualifications and responsibilities.
- Organisational structure, including committees.
- Progress reports for activities including highlights, achievements, challenges, funding and future initiatives.
- Testimonials and short case studies from service users, staff, volunteers and donors.
- Examples of sector leadership, advocacy and professional development.
- Activities around access and inclusion, such as a Diversity Equity and Inclusion Plan.
- Progress on your Reconciliation Action Plan.
- Acknowledgements of supporters, donors and volunteers.
- Policies and practices around risk management, operations and communication, including privacy, feedback and complaints.
- Staff and volunteer service recognition.
- Calls to action encouraging donations or volunteering.
- Audited financial report if required.
Plan for accessibility and inclusion
Think accessibility and inclusion when planning the content, design and delivery of your annual report.
Include scannable plain language summaries, infographics and plenty of images. Also, design the report with ample white space to give the eyes a rest from vast banks of text.
If your publication is digital, consider embedding video or providing links to your website for further information.
A digital report is also more shareable. An accessible document specialist will help you create a digital document that accommodates the needs of people with disability and those who use assistive technology to navigate the web.
Some organisations also prepare a separate version of their report in Easy English for people with lower literacy.
Know your tone of voice
To identify your brand personality or tone of voice, think about how others describe your organisation. Formal or friendly, playful or authoritative?
Raw content for an annual report comes from various areas and authors across your organisation. That’s why it’s vital to know your tone of voice and to have an organisational style guide. This ensures that whoever is editing the content can keep it consistent.
Read more about finding your tone of voice.
Dealing with bad news
An annual statement or report is about accountability and transparency. It’s about sharing your year’s work with your stakeholders. Sometimes it’s not all unicorns and rainbows.
Maybe things haven’t been great in the past year. Perhaps legislative or funding changes have created challenges for your organisation. Maybe one of your assets is losing money. Whatever the case, don’t leave your stakeholders in the dark.
It’s possible – and advisable – to present a positive and optimistic annual report that balances an honest picture of your operating landscape.
Don’t risk your reputation or strain loyalty by fudging the facts.
If you need guidance around communicating actual or potential bad news, a reputation and crisis management consultant can help you.
Show the stories behind the numbers
Many stakeholders don’t find financial reports of Australian non-profits engaging. They say they’re difficult to understand and prefer visual displays of key information and stories that build emotional connection.
Narrative style reporting that shows your impact through stories brings your work to life in a more relatable way than facts and figures alone.
Make it easier on yourself at reporting time by building a bank of human-interest stories and images updated throughout the year. Ask staff and volunteers to let you know of case studies in their daily work. Consider also using them in your social media or fundraising campaigns.
As you collect them, tag them by subject or service area so you can efficiently sort and assign stories to the various sections of your annual report.
Set up ethical storytelling policies
Collect human interest stories ethically by following clear guidelines. Create policies around the storage and use of people’s stories to promote your cause. Make sure people are aware of how you plan to use their story and their rights if they change their mind.
This may involve them signing a release form and checking in with them any time you intend to use their story.
How to set up an efficient report drafting process
Establishing clear processes in the planning stage will make pulling together your report a breeze.
If you’re not sure what your suppliers need to work efficiently, ask. It also helps to choose suppliers – such as writers and graphic designers – who are used to working together.
A page plan lays a clear path for the annual report team. It’s a ‘source of truth’ document that assigns content order, priorities and responsibilities. It doesn’t need to be set in concrete but is an ideal starting point.
Use the page plan to organise the source content, saving raw material into a single document in the intended order. If the report is large, create separate documents for governance, operations and finance sections to make it more manageable.
Add inline comments as you go to flag relevant priorities or issues, or to show where more information is needed.
Then hand it over to your writer to get busy.
The writer’s role
The writer’s scope of work and time requirements will vary depending on the state of the source material. Allow more time and budget if you need them to source additional information or do interviews to prepare content.
When working with source material a professional writer will:
- cross-check sections to find duplications or anomalies
- flag information that is unclear or confusing
- edit to ensure the content adheres to your organisation’s tone of voice and style guidelines
- apply a consistent style for grammar, punctuation and spelling
- ensure use of inclusive language throughout, or flag areas of concern
- edit to simplify language and reduce word count where needed.
What to expect in the first draft
An annual report is a collaborative effort and the first draft is your opportunity as project manager to check it’s heading in the right direction.
The draft is likely to include tracked changes and comments for your review. As well as standard copy edits, some things you may see include:
- notes on heading hierarchy
- queries on language choice
- suggested links
- observations on structure, format and priorities.
Sometimes this first version requires few additional changes. More often, while most of the work will now be done, the draft will still need clarifications, fact checking and amends from your subject experts. Seeing the report’s copy set out in a more coherent way may also trigger shifts in content order and priority.
It’s best to source and approve raw content from the beginning. But it’s also important to provide constructive feedback and suggested amendments during the drafting stage.
If the changes don’t shift the project scope or go back on an agreed brief, any content writer committed to delivering a quality report will welcome meaningful amends.
What to look for in the second draft
The second draft will incorporate agreed changes and, if everything is on track, will be ready to pass on to the designer for layout.
Sometimes third and fourth drafts are required. This is most often the case if the source material was not ready from the start. It’s also more common where many people give feedback on the entire report rather than focusing on their own subject area.
Apart from any last clarifications from subject matter experts, it’s best to keep the second draft review team small and focused.
Preparing for the design and layout stage
Avoid leaving major copy amends to the layout stage. Editing content within a PDF is fiddly, inaccurate and can interfere with the designer’s work.
It’s best to limit edits in the layout stage to trimming word counts and spotting typos.
A content writer can also assist in this stage by writing alternative text for your chosen images and infographics.
Speaking of accessibility, make sure your designer is familiar with web content accessibility guidelines (WCAG) to ensure your digital report is available to anyone who wants it. Leaving remediation until the end will add avoidable time and cost to your project.
Beyond the PDF
While most annual reports take a printed or PDF format, or both, some organisations are experimenting with alternative formats to improve audience engagement.
- Produce your printed reports like a high-end magazine, inviting readers to delve into feature articles showcasing your successes and vision.
- Summarise your annual information statement as a postcard in a concise visual format.
- Create a video version that focuses on oral storytelling.
Digitised publications bring your work to life with multi-media features. You could even create a Spotify playlist for your report to help set the mood for each section.
Even printed reports can embrace multimedia, with embedded QR codes that link to visual storytelling clips or sections of your website.
Think about your audience and don’t be afraid to get creative. Just be sure that the format you choose still meets any governance obligations and remember to keep it accessible.
Is your non-profit annual report award-worthy?
The Australasian Reporting Awards (ARA) are announced annually across eight sectors including:
- public administration
- community and welfare
- health, research and education.
Established in the 1950s, ARA is an independent, not-for-profit body giving organisations the chance to benchmark their reports against their peers and world’s best practice.
As well as the annual awards, the site offers loads of terrific resources to assist you in planning and creating an award-worthy report.
Tick off report governance, then get creative
Annual reports are a perfect opportunity to showcase what you do, what you’ve achieved and where you’re headed. Your job is to know your formal reporting requirements and then to get creative around those rules.
Know your goals and your audience’s needs, then plan well. Collect your stories throughout the year and present your impact in an engaging report that builds trust, promotes your work and attracts support.
Need a hand creating an engaging and impactful annual statement or report? Get in touch.
