Module 8.13 – Preparing Information

 

Module Introduction

            There is more than accuracy involved in preparing financial information for release. In many cased the entire “package” is as important as the numbers it contains. In school, many of us lost points in math class because we didn’t “show our work”—show how we had reached our final answer. When it comes to financial statements, you will have to walk a fine line. You will have to show some “work,” but it can be damaging to show too much.

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1. Preparing the Information

There is more than accuracy involved in preparing financial information for release. In many cased the entire “package” is as important as the numbers it contains.

In school, many of us lost points in math class because we didn’t “show our work”—show how we had reached our final answer.

When it comes to financial statements, you will have to walk a fine line. You will have to show some “work,” but it can be damaging to show too much.

How do you determine how much needs to be shown?

Well, to whom are you going to show them?

Are the numbers going to be seen by:

1.      Shareholders?

2.      Partners?

3.      Market analysts?

4.      Auditors?

5.      The tax collector?

6.      Vendors?

7.      beneficiaries?

8.      Your trade association (in other words, your competition)?

9.      Media?

10.  All of the above?

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2. How Much Do You Tell Them?

            Never ask a barber if you need a haircut, a cop if you were speeding, a life insurance agent if you need more insurance, or teenagers if they enjoy doing their assigned household chores.

You already know what their answers will be.

Following that logic, if you ask people who prepared your financial information if it should be released to the public, and if so, how much the various external groups of people actually need to see, they will very likely give you one of two answers:

1. “No! Nothing! Tell me nothing. It’s a secret.”
2. “Yes! “All of it! Everyone needs to see all of it.”

The correct answer is somewhere in the middle, but just where in the middle depends on any number of variables.

One of the problems you run into is that while you can prepare one set of numbers to release to market analysts and another to release to the media, there is nothing stopping one group from looking at what you prepared for another.

Unlike governments that can classify information on a “need to know” basis, or organizations that can maintain control of information within the confines of the organizational structure, once information is released to anyone in the public it has, in effect, been released to everyone in the public.

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3. How much Do You Tell Them (Continued)

            Even if a report is aimed at the media, stockholders, vendors, or a market analyst, you have to write it as if everyone will see it.

            Fortunately, few people in the public are all that interested.

            Another point to keep in mind, however, is that when it comes to financial information, no matter what you prepare, you will likely be dealing with people who know your organization, product, or financial situation better that you do. In fact, some will very likely know more about all three of them than you do.

            After all, you have to communicate with financial analysts who crunch numbers for a living and sector of activity experts who will compare your report to every other one in your market sector as well as with stockholders who inherited their shares. You also have to communicate with someone who bought shares because their brother-in-law or grandchildren told them too, and aren’t really sure what it is exactly that you do.

            How do you cover that wide an audience? They all have different needs, expectations, interests, backgrounds, and expertise.

You give everyone both what they need and what they are entitled to receive, and you do so in language that they will understand.

Now let’s look at how to do it.

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4. Egos and Expectations

            We all have egos and expectations.

            If you write as a hobby, and you are working on a short story, a novel, a script, a poem, or any other type of writing that is not related to your work, you are entitled to consider it your intellectual property. You are also entitled to have it say what you want it say in the way you want to say it. It is your creative work. You own it. Your name will be attached to it.

            If you are working on a financial report for work, however, it is not your work. It is the organization’s. It must say what the organization wants to say and do so in the way the organization wants it said. Even if your name is on it, the organization owns it and has the final say on its form, format, style, tone, look, and content. It is the difference between designing a race car and putting in the ignition system. One person created the machine and the other worked on it, under the direction of the person who created and owns it.

            Expectations can also get you into trouble. If you write a novel and it is published, you can expect to be congratulated and praised. You deserve it. Many, many people try, but relatively few ever succeed.

            If you prepare a financial report for work, you are just doing your job. If you get a “Well done!” from your boss and praise from your coworkers, that is wonderful. It’s also a bonus. All we can ever truly expect from work is a paycheck and the satisfaction of doing our jobs as well as possible.

            When it comes to writing in the organizational environment, put your ego in a box, and treat compliments as an unexpected bonus. To do otherwise, leads to resentments.

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5. Getting the Numbers Down—By the Numbers

            How you want to prepare your information will depend on how you answer the following questions:

1)         What do you want to say?

            If you are responsible for preparing a media release about a new project in which the private sector and the government are jointly funding a research facility that will look at developing alternative energy sources, you do not have to be an expert in finance or alternative energy sources. You and your staff do, however, have to have access to experts who can explain it so well that you and your staff can then turn around and explain it to people who know less about it than you did when the project started.

2)         To whom do you want to say it?

            Even though the information may be read by a wide variety of people, you nay have a more narrow focus as your target audience. The key point to remember is that your specific audience will help you shape your message. If you aim it at market analysts and a journalist picks it up, it is the journalist’s responsibility to be able to look at it with the same knowledge and insight that a market analyst does.

            If a market analyst picks up a release sent to the media, they will ge t what the media gets. If they want more, they will have to ask for it.

3)         How are you going to say it?

            If you are writing about financial information in a media release, it still has to follow the standard media release format. If it is contained in a letter to investors, make sure that it looks like other letters to investors. If it is an annual report, it better be quickly identifiable as an annual report.

6. Getting the Numbers Down—By the Numbers (Continued)

4)         How will you organize your ideas?

            Organizing can be as much of a physical process as a mental one. When it is time to start the actual writing, make sure that you know where everything is: figures in one file or stack papers; interpretations of those figures in another; projections in another place; comments about the numbers, their interpretation and what they portend someplace else. It doesn’t really matter how you organize them as long as you know where all the information is when you need it, and can get to it easily. Some people put everything on 3-by-5 file cards others put it in neat stacks of paper, and still others pin or tape everything to the wall, or spread it out on a large table of on the floor.

            There is no one right way to do it. Whatever works for you, works for you.

5)         Can you be logical?

            The reason we all learned how to outline stories and reports and term papers in school was so we could present them in a logical way. Most professional writers still use that process for long pieces of writing. In fact, most of them are paid in three stages: the first third for the outline, the second third for the first draft, and the final third when the work has been rewritten, polished, and accepted by the publisher or studio.

            The logical place to start your outline is at the beginning. What is the first thing your audience needs to know in order to understand everything you are going to tell them? What do they need to know next? And so on.

            You can outline on paper, a computer screen, or a chalkboard. Once again, there is no one “right way” to do it. Whatever works for you, works for you.

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7. Getting the Numbers Down—By the Numbers (Continued)

6)         Can you prove it?

            Journalists, investors, government regulators, bankers, financial analysts, and anyone else who reads your report will want proof that it is true. Give your audience enough information so that they can judge for themselves that it is true. Writing has more impact and is more credible when you can show that something is true instead of merely stating that it is true.

            Your writing should also be specific instead of value, and every claim needs to be backed up with facts.

7)         How many numbers do you throw at them?

            Some people want to look at every number you have, and then do their own math. Others will want to see all of them and then select some random sections to check. Some want to see charts and other graphic representations of the numbers. Then there are those who will focus on the bottom line, and those who just want to know what all the numbers mean.

            When it comes to a media release or an announcement, give those numbers that you have to in order to make your point. You can explain how they were reached, but do so without going into the math or the formulas.

            If you’re writing for an analyst, give them all the numbers they want. If someone else reads it, it’s up to them to either figure it out, or ask for assistance. Give the numbers, and then explain where they come from, how they were derived, and what they mean.

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8. Getting the Numbers Down—By the Numbers (Continued)

8)         Is your report believable?

            There is more involved than numbers. Your readers will want to feel that they are being told the truth. They want to know why something is being done, what’s at stake, and what their part in it is. They also want to know why they should care.

            When you write something, you establish a relationship with the reader. The reader gives you time, interest, attention, and, it is hoped, an open mend. Your job is to make reading what you wrote worthwhile. To do this you must make sure it is honest, focused, easy to understand, as interesting as possible, and show why what they are reading is relevant—how it applies to them. If readers decide it is deceitful, filled with self-serving half-truths, irrelevant, manipulative, pompous, or boring, they will turn against you and your program, plan or cause.

9)         Is it simple?

            Good writing is clear, focused, and easy to follow and understand. Something as complex as a financial report, even an annual report, can—and should—be possible to follow without too much effort. Just remember that different readers will be focusing on different parts of the report. Those people who focus on the numbers should have no trouble reading yours. Those who want summaries should be able to understand them.

10.       Is it too long?

            Financial reports can be long documents. Everyone knows and accepts that. Don’t make them any longer than they need to be.

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9. Put Your Message Online

            Every single bit of “non-secret” financial information you produce for any external audiences can go on your Internet website.

            Professional writers, editors, graphic artists, and designers can make your site look as good as any “professional” media site, such as the online versions of the world’s top newspapers and magazines.

            The problem, however, is not just getting the information on the Internet in an attractive and easy-to-follow format. Once again, you are competing with all the Internet sites in the world for reader time and attention; quite often your potential audience doesn’t even know you exist. The biggest problem most organizations face is letting people know that they are online, and just what it is they have to offer.

            This is less of a problem when you are preparing specialized messages for isolated groups; there are a limited number of market analysts that cover your sector of activity or sector. It’s fairly simple to let each of them know where you post financial information on the Internet, and how often it is updated.

            You can also let stockholders, vendors, and any other sector know where they can find current information that is tailored for their needs. They can also look at the information you present for other sectors as well, but the odds are that they will focus on the material prepared for them.

            After all, they are in project/programme purpose, too, and they have other things to do than spend too much time focusing on your numbers.

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10. Details

            All it takes is one little mistake in addition or subtraction to get the wrong answer when you balance your checkbook. Starting a turn in your car either a little bit late or a little too early can leave you with scratched fenders. Failing to get the right information to the right people at the right time can mean delays, embarrassment, and chaos.

            The two biggest problems with details is that they are so easy to overlook, and can cause so much trouble when they are overlooked. So let’s look at some details that go into preparing information for release. Here is a checklist:

1. What information do they really want?
2. What information can they actually have?
3. When do they need it?
4. In what format or medium do they want it? You can give it to them on paper, disk, e-mail, as a spread sheet, columns of numbers, etc.,
5. Has the person or department in charge of that information actually released it for this use, and double-checked the report to make sure it is accurate and current?
6. Is it presented in a way its intended audience will understand?
7. Is there any information that should not be there?
8. How much of an explanation does the information need, and who should prepare and approve it?
9. How will you get it to them?
10. How will you make sure they receive it?

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Assignments

 

Multiple-Choice (3)

 

1.         Even if a report is aimed at the media, stockholders, vendors, or a market analyst, you have to write it as if _______ will see it.

a.       Employees

b.      Everyone

c.       Consumers

d.      None of the above

 

2.         The work on a financial report is _______ work.

            a.   Your         

            b.   The organization’s

            c.   Your employee’s

            d.   None of the above

 

3.         If you prepare a financial report for work, you are doing your _______.

            a.   Job

            b.   Homework

            c.   Accounting

            d.   None of the above

 

4.         Even thought the information may be read by a wide variety of people, you may have a more narrow focus as your ________.

            a.   project/programme purpose

            b.   Target audience

            c.   Message

            d.   All of the above

 

5.         If writing about financial information in a media release, it still has to follow the ________.

            a.   Standard media release format

            b.   Guide

            c.    Media’s image

            d.   None of the above

 

6.         If you aim your message at market analysts and a journalist picks it up, it is the _______ responsibility to be able to look at it with the same knowledge and insight that a market analyst does.

            a.   Writer’s

            b.   Market analysts’

            c.   Journalist’s

            d.   None of the above

 

7.         The logical place to start your outline is at the _______.

            a.   Beginning

            b.   Middle

            c.   End

            d.   None of the above

 

8.         Give your ________ enough information so that they can judge for themselves that your report is true.

            a.   Employees

            b.   Audience

            c.   Stockholders

            d.   All of the above