How to Create a Simple Annual Report for a Small Business

A simple annual report for a small business or nonprofit is a 4 to 12 page document that tells your stakeholders what you set out to do this year, what actually happened, what the money looked like and what comes next. This guide covers the sections to include, the numbers worth reporting, a fill-in template, a worked example and design tips that make a modest report look professional without a designer.

What an Annual Report Is (and What It Isn’t)

The phrase “annual report” means three different things in the United States, and mixing them up causes confusion.

Term	What it is	Required?
State “annual report” filing	A short form many states require LLCs, corporations and nonprofits to file with the Secretary of State to keep registration active, usually with a fee	Yes, in many states; names, deadlines and fees vary
IRS Form 990 series	The annual information return most tax-exempt organizations file with the IRS	Yes, for most exempt organizations
Annual report (this guide)	A readable summary of your year for donors, customers, investors, lenders, staff or a board	Usually voluntary for private businesses and nonprofits

This guide is about the third kind. It’s still worth knowing the other two, because a good annual report should agree with them. For nonprofits, the IRS chart of which Form 990 to file shows the thresholds: Form 990-N for organizations with gross receipts normally $50,000 or less, Form 990-EZ for gross receipts under $200,000 and total assets under $500,000, and the full Form 990 above those levels. Private foundations file Form 990-PF. Rules and thresholds can change, so confirm with the IRS or a tax professional each year.

Who Reads It and Why It’s Worth Doing

• Donors and grant makers want proof their money did something. A clear report makes the next gift easier to ask for.
• Board members and investors want a single document that summarizes the year.
• Lenders and landlords sometimes ask for evidence of stability; a polished summary alongside your financial statements helps.
• Employees and volunteers rarely see the full picture of what their work added up to.
• Customers and the local community respond to milestones and stories, especially for mission-driven businesses.
• Reporters may use it as background. A milestone in your report can also be the seed of a news announcement; see this explainer on what a press release is if you’re weighing that.

The 8 Sections to Include

1. Letter from the owner, founder or board chair

One page, in plain language. Say what the year was like, including what was hard. Readers trust a letter that admits a setback and explains what you learned far more than one that only celebrates.

2. Year at a glance

A single page or panel with three to six big numbers. For a nonprofit: people served, meals delivered, volunteer hours. For a business: customers served, jobs created, products launched. This is the page most people will actually read.

3. Mission and who you are

Two or three sentences on what you do and for whom. New readers need the context; returning readers skim it.

4. Highlights and milestones

A short timeline of the year’s key moments: a new location, a major contract, an award, a program launch, a partnership.

5. Impact and stories

One to three short stories, each about a specific person, customer or project, with permission to share. A story makes the numbers feel real.

6. Financial summary

Revenue, expenses and the result, presented simply. Nonprofits should show where revenue came from and how money was spent.

7. Thank-you and supporters

Donors, partners, sponsors, key customers who agreed to be named, volunteers and staff. Check spelling of every name and honor requests for anonymity.

8. The year ahead

Two or three goals for next year and, for nonprofits, a clear way to help: donate, volunteer, partner.

What Data to Include: Business vs Nonprofit

Category	Small business examples	Nonprofit examples
Reach	Customers served, repeat customer rate, new markets	People served, events held, communities reached
Output	Orders shipped, projects completed, products launched	Meals, classes, hours of service, items distributed
Outcomes	Customer satisfaction score, retention, reviews	Participants who completed a program, housing placements, test score changes
People	Employees, jobs added, training hours	Staff, volunteers, volunteer hours
Money	Revenue growth, gross margin, reinvestment	Total revenue by source, program vs support spending
Community	Local suppliers used, donations, sponsorships	Partner organizations, in-kind gifts

Private businesses: you don’t have to publish exact revenue. Many owners share growth percentages, ranges or non-financial milestones instead. Decide what you’re comfortable with, and be consistent from year to year so readers can compare.

Nonprofits: if you file the full Form 990, you already break down expenses into program services, management and general, and fundraising. Using the same categories in your report keeps the two consistent. Remember that Form 990 returns are generally available to the public, so donors can compare.

How to present the financial summary

Here is an illustrative layout for a small nonprofit. The figures are invented for the example.

Revenue	Amount	Share
Individual donations	$148,000	53%
Foundation grants	$82,000	29%
Events (net)	$31,000	11%
Program fees and other	$19,000	7%
Total revenue	$280,000	100%

Expenses	Amount	Share
Programs	$205,000	77%
Management and general	$38,000	14%
Fundraising	$24,000	9%
Total expenses	$267,000	100%

Add a line that explains the difference: “We ended the year with a $13,000 surplus, which we added to our operating reserve.” Note whether the figures are audited, reviewed or unaudited, and which fiscal year they cover.

Fill-In Annual Report Template

Copy this outline into a document. Each line is a prompt; replace it with your content.

1. Cover: Organization name, “Annual Report [Year],” one strong photo, website.
2. Letter (250-400 words): “This year we set out to ___. Here’s what happened: ___. The hardest part was ___. What we learned: ___. Next year we’ll ___. Thank you to ___.”
3. Year at a glance: Number 1 ___ (label). Number 2 ___. Number 3 ___. Optional 4-6.
4. Who we are (50-80 words): “We [what you do] for [who] in [where] so that [result].”
5. Milestones: Month: event. Month: event. (5-8 entries)
6. Story 1 (150-250 words): Who, the challenge, what you did, what changed, a quote.
7. Story 2 (optional).
8. Financial summary: Revenue by source, expenses by category, net result, one-sentence explanation, fiscal year, audited/unaudited.
9. Thank you: Supporters, partners, staff, volunteers.
10. Looking ahead: Three goals for next year. How to help or get in touch.
11. Back page: Address, website, phone, social handles, EIN for nonprofits if you wish to include it.

Worked Example: An Illustrative Food Pantry

This is a made-up organization to show how the pieces fit. Imagine a volunteer-run food pantry in Spokane, Washington, with two part-time staff.

• Year at a glance: 3,400 households served; 412,000 pounds of food distributed; 9,800 volunteer hours; a new Saturday distribution added in June.
• Letter: The director explains that demand rose sharply in spring, the pantry ran short twice, and a partnership with two grocery stores for surplus produce solved the shortage by summer.
• Story: A retired school bus driver who started volunteering after using the pantry herself, shared with her permission.
• Financials: Revenue and expense tables like the ones above, with a note that donated food is shown separately as in-kind support.
• Looking ahead: Add a second refrigerated truck, launch a weekday evening hour, recruit 50 new volunteers.

For a small business, the structure is the same. For example, an illustrative family-owned HVAC company might lead with “1,900 service calls, 11 technicians, 4.8-star average rating, two apprentices hired,” tell the story of an emergency job during a cold snap, show growth as a percentage rather than dollars, and close with plans to add a second service area.

Design Tips for a Report That Looks Professional

• Start from a template. Free templates in Canva, Google Docs, Microsoft Word or Adobe Express give you a consistent grid and typography.
• Use your brand colors and one or two fonts. Consistency matters more than flair.
• One idea per page or panel. White space makes a short report feel considered rather than thin.
• Make numbers big. Set key figures in large type with a short label underneath.
• Choose simple charts. Bar charts and a single pie or donut for revenue sources are enough. Label values directly on the chart.
• Use real photos of your team, customers and work, with permission. Avoid generic stock images where you can.
• Write for skimmers. Headings, short paragraphs and pull quotes.
• Make it accessible. Strong color contrast, readable font sizes, alt text for images in digital versions and a text-based PDF rather than a scanned image.
• Proofread names and numbers twice. A misspelled donor name does more harm than a plain layout.

Format options

Format	Best for	Effort
2-page PDF “impact snapshot”	Very small organizations, email attachments	Low
8-12 page PDF	Boards, grant applications, donors	Medium
Web page on your site	Search visibility, easy sharing, accessibility	Medium
Printed booklet	Major donors, events, lobby display	Higher (printing cost)
Short video summary	Social media, gala events	Higher

Timeline: From Data to Distribution

1. December: Decide the format, pick the headline numbers and request photos and stories.
2. January: Close the books for the year. Pull financial figures once your accountant confirms them.
3. February: Draft the text, build the layout, get one outside reader to review it.
4. March: Final check of names and numbers, then publish and send.

Nonprofits on a calendar year should also keep the Form 990 deadline in view. The IRS says the return is due by the 15th day of the 5th month after the end of the organization’s accounting period, which is May 15 for a calendar-year organization. Preparing the annual report first means your numbers are organized before the return is due.

How to share it

• Email it to donors, customers or investors with a two-line summary and the year-at-a-glance numbers in the email body.
• Post it on your website as a page, plus a downloadable PDF.
• Share one chart or story per week on social media for a month.
• Bring printed copies to meetings with funders, lenders and partners.
• If your report contains genuine news, such as a major milestone, you can turn that into an announcement; these press release examples show common formats.

Frequently Asked Questions

Is a small business required to publish an annual report?

Private small businesses are generally not required to publish a public annual report like the ones public companies file. Many states do require a short annual registration filing with the Secretary of State, which is a separate obligation. Check your state’s rules.

How long should a nonprofit annual report be?

For a small nonprofit, 4 to 12 pages is typical. A two-page impact snapshot is better than a long report that never gets finished.

Is the annual report the same as Form 990?

No. Form 990 is a tax information return filed with the IRS, while an annual report is a voluntary communication piece. Your report’s financial figures should be consistent with your return and books.

Should I include exact revenue in a business annual report?

It’s up to you. Many private companies share growth percentages, ranges or non-financial results instead of exact figures. Whatever you choose, stay consistent from year to year.

What is the best software for making an annual report?

Canva, Google Docs, Microsoft Word and Adobe Express all have free or low-cost templates that work well. The best choice is the one your team already knows how to use.

When should an annual report be released?

Within the first three months after your fiscal year ends is a good target. That keeps the information fresh and gives you time to confirm the financial numbers.

Begin With the Year-at-a-Glance Page

If you only do one thing this month, choose your three to five headline numbers and start collecting them. That single page is the heart of the report, and once it exists, the letter, stories and financial summary are much easier to build around it. Rules for filings and tax returns change, so check official sources or ask an accountant about anything compliance-related.