The Anatomy of a Superb Annual Report

I’m a huge fan of nonprofits sharing an annual report, but only if it’s crafted the right way. These documents, which are frequently used by both corporations and nonprofits to educate stakeholders about the overall health of the organization, play an important role in educating people about what you’re doing and how you’re doing it.

While this all sounds quite simple, an annual report requires a lot from your nonprofit. You’ll need to stay organized and track data over the course of the year, compile that data, and report on it accurately and effectively.

View your annual report as a way to build trust with your supporter base, but don’t’ stop there. Elevate your annual report by including all the relevant data your donor expects, and then adding an “ask” at the end.

Let’s get started refining and enhancing your nonprofit’s annual report.

Nonprofit Annual Report Template & Basics

Nonprofits and charities distribute annual reports yearly (hence, the name), usually at the start of the calendar year. The document, which focuses on the impact the organization has on the community, often touches on various aspects of that reach.

The main goal of the annual report is to provide your supporter base with the information they need to ensure you’re running a smooth and smart operation!

When deciding what information to share, consider your audience. In most cases, your annual report readers are your most loyal supporters such as your donors, volunteers, board members, and other community members, as well as prospective supporters, grantors, and other funders.

Then, think about what they should know. Did you have phenomenal program results this year? Did your average donation increase significantly? Was your donor’s return on investment (ROI) significant? These are all highlights to share.

Components of Annual Report

While the content of your annual report varies from year to year depending on what you achieve and how you achieve it, the overarching touch points are usually consistent. Always include these sections in your report:

• Your organization’s mission statement and vision: You don’t have to include your entire nonprofit marketing pamphlet, just remember to include your mission and vision statements (if you have one) to reinforce the message.
• Accomplishments: Highlight 3-8 outstanding accomplishments across multiple areas of your organization, including fundraising, programming, volunteer efforts, etc. Use infographics, images, and charts to emphasize these feats.
• Impact-related stories: Personal stories elevate any annual report. Use client success stories, donor testimonies, and quotes from board members to help convey the message that your cause is promoting change.
• Donors: Donor lists take up the majority of space in an annual report, but should be included whenever possible. If you have a large donor base and simply cannot add each donor name to the report (especially if you plan to print and distribute the document), consider creating a separate donor list, but go ahead and at least add your major gift donors to the official annual report.
• Financial data: In addition to adding your Form 990 to your website, which is a transparency best practice, you should also report a snapshot of your financial data in the annual report. Include total revenue and expenses, breaking your data down into sections whenever necessary.

Amplifying Your Annual Report By Presenting an “Ask”

At this point, you know what you should put into your annual report, so that it’s both informative and promotes transparency, but is there anything you can do to truly amplify the impact of this report?

Absolutely!

The best way to get the most out of your annual report is to add a clear call-to-action to give.

Let that sink in for a second.

Yes, the annual report is supposed to be about recapping your year, but it’s also an important tool to help prepare you and your supporters for the upcoming year.

By addressing your accomplishments in the annual report, you’re proving that you’re an effective, worthwhile organization. And once your donor, board member, or other supporters browse through the document, they’re most likely left with all sorts of positive feels about what they’re a part of. They’re inspired.

Don’t leave them hanging. Do something with that inspiration.

Incorporate the “Ask”

Here are a few ideas to get your wheels turning about how you’ll incorporate an “ask” in your annual report:

• Use your annual report as a way to kickoff your annual giving campaign and direct people to where they should go to give, such as a static online donation page.
• Introduce an upcoming peer-to-peer fundraising campaign and ask for volunteers to become personal fundraisers.
• Create a standalone fundraiser around the time you send out annual reports that addresses a specific impact or program highlighted in the report.
• Promote your recurring giving program in the annual report. Detail the highlights of the program for your organization and the benefits your donor receives when they choose this giving option.

Providing your annual report readers with a specific action to take once they read all the exciting things happening at your organization is an easy way to mobilize people into action and continue to fuel your organization’s mission.

You’re spending a significant amount of time crafting your annual report, so why not amplify it with a clear call-to-action and an easy “ask”? At the very least, it’s always a good idea to put the idea of giving at the forefront of your reader’s mind!