August 3, 2021

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Business term: Directors’ report contains monetary and non-monetary information

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Directors’ reports, chairman reports, a report from the CEO and other reports, such as corporate governance, forms part of the nonfinancial reports available in an annual report. In this lesson, the focus is on the directors’ report.

Definition of Directors’ report

The directors’ report is a nonfinancial report presented by the board of directors in compliance with the company’s Act. In Nigeria, the company’s Act is the Companies and Allied Matters Act, CAMA’ 2014.

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It can also be defined as a report prepared by the board of directors of companies quoted in the stock market that reveals the directors activities and interest in the company.

Some content you can find in a directors’ report

Based on the annual report of UBA Nigeria for 2018, here are some contents you can find in a directors’ report.

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Content at a glance: This is a monetary aspect of the directors’ report. It shows a summary of the profit or loss statement. You can the comparative figure for profit after tax and total comprehensive profit.

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Business term: Directors' report contains monetary and non-monetary information

Dividend: In this part, the director states the dividend per share (DPS) that is earned by shareholders.

Legal form: Here, the legal status of the company is clearly stated. It may include and Mergers and Acquisitions. For example, in the UBA annual report, it was stated that the company acquired Continental Trust Bank Limited in December 2005.

A number of directors and their shareholding: This aspect shows the number of directors in the company as well as their shareholdings. The position held by each shareholder is stated. Also, the number of shares they are currently holding boh, directly and indirectly, are notified in this report.

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Business term: Directors' report contains monetary and non-monetary information

Donations: The donations made to various nonprofits are listed. One of each nonprofit organization and the amount contributed. For UBA group, about 1.05 billion Naira was contributed to Non-Governmental Organisations, NGOs.

Employments and Employees: In summary, this report reveals the number of employees within the company. It also shows the health and safety measures applied by the entity on behalf of the staff. For the UBA group, the number of persons employed by the firm amounts to 12,909 persons.

To conclude, the director’s report contains highlights of the activities of the directors to certain stakeholders, shareholders, employees, and corporate philanthropy. A good directors’ report must be clear, understandable and comparable. In the next lesson, we will consider the corporate governance report.

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