Firms Boost Budgets for Online 10-Ks

Electronic annual reports allow companies to disclose information without racking up printing costs.
Taylor ProvostFebruary 7, 2013

Companies are increasingly publishing annual reports online and printing fewer copies, according to a recent member survey by the National Investor Relations Institute (NIRI).

Budgets for electronic 10-Ks have grown 31% since 2010, while those for printed annual reports have plummeted over the past decade, the report found. The average total budget for online 10-Ks in 2012 was $15,330, while the median budget for preparing and printing annual reports was $65,000, down from $138,800 (adjusted for inflation) in 1999. The median print range was 5,000 copies or lower, compared with between 10,000 and 20,000 copies four years ago.

“Because we’re now in an environment that has increasingly more regulatory requirements, people are using electronic media to get their message out,” comments Jeff Morgan, CEO of NIRI. “And because it’s more immediate as opposed to print publication, people are using that to complement other things that they’re putting out. They’re not doing away with print, but increasing [disclosure] on the electronic side.”

Another reason companies are printing fewer copies is because 10-Ks have grown longer. About 43% of respondents reported printing reports of 101 pages or more in 2012, compared with about 19% in 2004. But while the number of overall pages is growing, the number of pages concerning financials is declining. In 2012 the median range for number of pages with financial data was 4 to 6 pages, down from 11 to 15 in 2010 and more than 20 pages in 2008. Instead, investor-relations departments are including more disclosures.

“People want to be able to understand business issues, so companies are trying to write that type of information in an easily digestible, easily understandable way,” explains Morgan.