The statutory report is the obligatory submission of financial and non-financial information to a government or concerned agency. This is a report that a company or organization must make public by law, especially its financial report. For a common example, this report is a statement drafted by the directors of a public limited company to forward to the shareholders at least 21 days before the date of the meeting. Each industry has its own set of laws and regulations (statues) that mandate reports. A copy is also sent to the registrar of joint-stock companies for registration. It is the mandatory submission of financial and non-financial information to a government agency. In many countries, International Financial Reporting Standards (IFRS) has replaced country-specific Generally Accepted Accounting Principles for statutory reporting.
Examples of Statutory Reports
The followings are examples of the statutory report.
- Statutory Report submitted at the statutory meeting of the company.
- Directors’ Report to the Annual General Meeting.
- Annual Returns.
- Auditors’ Report.
- Reports by Inspectors appointed to investigate the affairs of the company.
After incorporation, a public limited company compulsorily arranges a meeting named statutory meeting with its shareholders within a period of not less than one month and not more than six months from the date at which the company is entitled to commence business. This meeting is held once in the lifetime of a company. In addition, companies in each industry, such as at banking and insurance companies, must file fiscal reports in each state they do business. It is held to inform the shareholders about the formation of the company, issue of shares, public subscription towards its share capital, the properties acquired, business prospects and so on. Publicly held companies are required to file additional reports with the Securities and Exchange Commission. In this meeting, the members discuss the statutory report prepared by directors.
The statutory report contains the following information.
- The total number of shares allotted whether fully paid up or partly paid up.
- Total cash received for shares allotment.
- An abstract of cash receipts and payments.
- The name, address, occupation of the directors of the company.
- Material information of a contract.
Examples of statutory regulations are the International Accounting System and the International Financial Reporting Standards, accepted global standards by which public companies prepare financial statements. Another common example of statutory reporting is a state law that requires all municipalities to undergo an audit of account money that is depleted and to make that information accessible to the public.