Annual report: how to communicate better while benchmarking the competition

The publication of annual reports is a strategic moment for a company . Listed companies need perfect control over their financial communication. They need to show their results in the best possible light, as the statements will be closely scrutinized by shareholders and investors . There is no room for chance, as both the results and the presentation of the numbers and comments are analyzed.

Preparing these statements was already a complex exercise before a new regulation emerged. Replacing traditional PDF files with the new ESEF format (European Single Electronic Format), an additional layer of technicity appeared. Fully digital but technically more complex, it is still possible to take advantage of the change. With a smart approach, the switch to ESEF is an opportunity to communicate more effectively and to benchmark yourself to your competitors. Discover how.

ESEF: the stakes of the new regulation

The goal of the European Single Electronic Format is to facilitate access, analysis and comparability of financial data . This change comes with a set of challenges for companies. Different approaches exist, some of them risky, time-consuming and massively error-prone. Now is the time to communicate wisely, as it is a time of risks but also of opportunities.

A wrong implementation of the new standard may incur:

• - the risk of negative consequences for your image and investor relations;
• - the risk of publishing compliant reports that are impossible for readers to read and understand - a huge opportunity cost;
• - poor internal control of the format means the risk of publishing regulated information of low absolute and relative quality;
• - the increasing number of round trips between your xbrl editor, you and your auditors, which means extra time and expense;
• - the risk of publishing non-compliant reports, leading to regulatory sanctions;

- the risk of not anticipating the increasing richness of communications with block tagging and additional financial and extra-financial data.

The switch to a newer standard is not just a technical and regulatory evolution. It is first and foremost, a financial communication event that will be closely observed. It must not be overlooked. The issued data will be used by investors and competitors to analyze, benchmark and make decisions.

For proactive auditors, this is a unique chance to t urn a technical challenge into a simpler, more comprehensive way to communicate better data . For companies, this is a chance to capitalise on their competitorsand even take advantage of the innovation to better benchmark their industry.

Read – Financial statements: how to gain autonomy during pre-publications?

ESEF: an opportunity to measure competition & improve financial communication

The ESEF standard means that financial statements should be issued in the XHTML format, instead of the old and tried PDF files. On one hand, this allows for better data management, but on the other hand, it adds a layer of complexity for accountants and auditors .

Having control over the issued information is key . It leads to a better knowledge of your activity, of the industry, of the competition. It provides you and investors with strategic information of the highest accuracy.

While bringing its set of technical complexities, the new standard is a chance to improve the quality of financial statements . By benchmarking other participants of the market with the right tools, you will determine key points of improvement in your own communication .

Another advantage of the switch to XHTML is the ability to compare financial data from other companies . Financial analysis is about to become sharper than ever. Following up on what your competitors are doing and how, you are able to assess and emphasise your own strength and thus seize unforeseen opportunities .

In the face of change, some may see a burden while others may see an opportunity. The ESEF regulation implies that data is now easier to manipulate, sort and compare. Some may get crushed by the technicalities while others will take the chance to communicate fine-tuned annual reports for their readers .

Read - ESEF: auditors, make an opportunity out of a challenge

Annual report: how to communicate better, while capitalizing on what the competitors do

Better data leads to better decisions . The world of tomorrow will be heavily reliant on the quality of data. Through standardization and technical evolution, pushed by regulatory bodies, it is already possible to leap forward and communicate better on your financial information. The key is simply to use the right tools.

So how do you go about it? Take up the challenge and take advantage of this new situation.

PRISM is the solution. A simple solution. You input data and you are provided with an Excel rendition of your data for easy and comprehensive review. You are provided with features in line with the regulatory bodies expectations, ensuring the quality and the comparability of your data.

With an intuitive interface, you make immediately sense of the inputs and outputs of the XHTML format.

PRISM implements the regulatory requirements of ESEF while helping you make your annual report understandable for human beings. It’s not just about financial data. The dashboard, indicators, tags and spreadsheet form make annual report preparation as easy as it was in the PDF days.

PRISM provides you with statistics from ESEF issuers all over Europe. You benefit from feedback regarding good practices and communication from competitors and other players in the industry.

A one stop shop that delivers:

• Market benchmarking data
• Industry benchmarking data
• Easy to use for a non-xbrl expert
• Easy to read and esay to find the desired information
• Available as a SaaS or on premise
• Guaranteed safety of your data

Thanks to this unique software, you will be able to completely take control of your financial communication . Your data are compliant, reliable and usable. With thorough analysis of your competition, you will be able to get ahead and improve your image, by focusing your communication on the most strategic points.

If you want to know more, contact us now.