How can I adapt my annual financial statement to the needs of my stakeholders?
July 11, 2022 | 40,00 EUR | answered by Fanni Ehrig
Dear Mr. Tax Advisor,
My name is Phillip Schneider and I am the owner of a medium-sized company. In recent years, I have always prepared the annual financial statements according to legal requirements, without paying particular attention to the needs of my stakeholders. However, I have now realized that my stakeholders - including customers, suppliers, banks, and investors - wish for more information and transparency in order to make better decisions.
My current annual financial statements only contain the legally required key figures such as revenue, profit, and total assets. However, my stakeholders are also interested in information such as liquidity, profitability, equity ratio, and debt ratio. Additionally, they would like to receive a forecast for the upcoming business year in order to align their plans accordingly.
I am concerned that my stakeholders may be dissatisfied due to a lack of information and as a result, may lose trust in my company. Therefore, I would like to know how I can adjust my annual financial statements to meet the needs of my stakeholders and provide them with the necessary information to support their decisions.
Which key figures and information should be included in my annual financial statements to meet the requirements of my stakeholders? How can I create a meaningful forecast for the upcoming business year that supports my stakeholders in their planning?
I look forward to your support and thank you in advance for your help.
Best regards,
Phillip Schneider
Dear Mr. Schneider,
Thank you for your inquiry regarding the adaptation of your annual financial statements to the needs of your stakeholders. It is very important that you address the wishes and requirements of your stakeholders in order to strengthen trust in your company and support their decisions.
In order to make your annual financial statements more meaningful and transparent, you should include information on liquidity, profitability, equity ratio, and debt ratio in addition to the legally required indicators such as revenue, profit, and total assets. These indicators are of great importance to your stakeholders as they provide insight into the financial stability and performance of your company.
Liquidity provides information about whether your company is able to meet its short-term obligations. Profitability shows how profitable your company operates. The equity ratio shows the proportion of equity to total capital and provides information about the financial independence of your company. The debt ratio shows the ratio of debt to equity and provides information about the financing structure of your company.
In addition to including these indicators, you should also create a forecast for the upcoming fiscal year. It is important to make realistic and well-founded assumptions to provide your stakeholders with a reliable basis for their planning. Consider both internal and external factors such as market developments, competitive situation, and economic trends.
To create a meaningful forecast, you can use historical data and trend analysis. Also consult external experts such as auditors or business consultants to validate and optimize your forecast.
Finally, I recommend regularly engaging with your stakeholders and seeking their feedback on your annual financial statements. This way, you can ensure that your annual financial statements meet the needs of your stakeholders and provide them with the necessary information to support their decisions.
I hope this information is helpful to you and I am available for any further questions.
Best regards,
Fanni Ehrig
