Annual Report Definition

Annual report is a comprehensive document prepared by a company each year that provides a summary of its financial performance, operations, and achievements over the past year, typically distributed to shareholders and the public.

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The definition of an annual report is a business document filed with the state that gives a short summary of the business’s structure. The annual report usually includes information about the company’s name, address, business owners, operators, and registered agent. 

Annual Report Benefits

Although a business can’t get around the requirement for filing an annual report, there are several benefits to filing that may encourage you to do it sooner. Filing your business’s annual report benefits the company and everyone interacting with it by keeping contact information in one place. Most annual reports have the business’s registered agent information for service of process or forwarding of official documents. 

The earlier you file, the less likely you are to miss your state’s filing deadline and subject your business to unnecessary fees and costs. Additionally, most states require an updated annual report on file for your business to remain in good standing. A timely filed annual report benefits your business by signaling to other companies that your business is still running and not at risk of dissolution. A business at risk of dissolution can present contract and liability issues to any person contracting with the business. 

Annual Report Considerations

Each state has different requirements for filing an annual report. However, most states throughout the country require that companies file an annual report every year that the business is operational. Other states require that a business file a biennial report every other year. There are usually large penalty fees assessed for failing to file an annual report with the appropriate state department. At worst, your business may be entirely dissolved for failure to file an annual report. To find out when to file your annual or biennial report, check your state’s official business filing website for more information. 

Additionally, your business may not need to file an annual report. States like Alabama don’t require standalone annual reports but may request additional information from your business for tax purposes. However, if you own a limited liability company (LLC), corporation, or nonprofit organization, your state most likely has a requirement for annual filing. 

To learn more, read our guide on how to file annual report for LLC.

Other Names for Annual Report

The annual report definition may be self-explanatory if that’s the name you’re familiar with. However, in other states, there are different titles for an annual report. Examples include:

  • Statement of information
  • Annual list of managers
  • Biennial report
  • Biennial occupation tax report
  • Biennial statement
  • Annual certificate

These names are more uncommon and very state-specific. However, they can be used interchangeably to describe a strikingly similar document.

Summary

The definition of an annual report is a document that provides an updated summary of your business’s information to the state. Your state filing agency’s website can verify your business’s yearly filing requirements. 

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We Can Help

Keeping up with the documentation for your business can get overwhelming. Missing filing deadlines for your state can cost your business hundreds of dollars in fees. That is why we offer an Annual Report Service to our clients.

This service helps you file your annual report so you can avoid costly errors and penalties from your state. We also provide Worry-Free Compliance that will help you stay up to date on your state’s filing requirements. We want to help you succeed in business. Don’t hesitate to use our services to get the help that you need. 

Disclaimer: The content on this page is for information purposes only and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.

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Written by Team ZenBusiness

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