Everything You SHOULD Include in an Annual Report & Sample Messaging

An annual report creates a high-level visual of what your organization has accomplished in the past 12 months. It’s a storytelling tool that illustrates your mission in action for funders, donors, volunteers, and community partners. It’s helps people understand:

• What your organization accomplished

• How effectively you used resources

• Whose lives were changed

• Where your work is headed

Below is a breakdown of what to include, why it matters, and sample messaging to help nonprofits communicate their impact with clarity and confidence.

1. A Warm Letter from the CEO or Founder

Why it matters:This message sets the tone for the entire report. It puts a human face on your organization and reassures supporters that leadership is reflective, transparent, and deeply connected to the mission. It’s also the part many readers skim first, so clarity and warmth are key.

What to include:

• A heartfelt expression of gratitude

• Major themes from the year (growth, challenges, resilience, innovation)

• Acknowledge any big transitions or shifts

• Reinforce the mission and community commitment

Expanded Sample Messaging:"This year showed us what is possible when a community comes together with a shared purpose. Thanks to your support, we expanded access to critical resources, deepened our relationships with partners, and walked alongside hundreds of individuals taking steps toward stability and opportunity. Even when challenges arose, they reminded us why this work matters and why our dedication to those we serve continues to grow."

2. A Narrative Summary of the Year

Why it matters:This is the story arc of your nonprofit’s journey. Instead of listing activities, this section should flow like a story, describing how your programs evolved, what changed in your community, and what you learned. Funders appreciate context and thoughtful reflection.

What to include:

• Shifts in needs or demand

• Program expansions or pivots

• Key moments or accomplishments

• Community feedback or insights

• Unexpected challenges and how you adapted

Expanded Sample Messaging:"Throughout the year, we saw an increasing number of adults seeking employment support as the job market rapidly shifted. In response, we launched evening coaching sessions and expanded our technology workshops. We also built new partnerships with community colleges to help clients access certification programs. Each step forward was shaped by listening — to our clients, staff, and partners — ensuring that our work remains responsive and relevant."

3. Impact Highlights (Stories + Data)

Why it matters:This is where your mission comes to life and the section that most people will read and connect with. The strongest annual reports combine narrative and numbers. 

What to include:

• Program outcomes

• Number of clients served

• Stories of client transformation

• Before-and-after examples

• Success rates, completion rates, or progress indicators

• Charts or graphics to make complex numbers easy to understand

Expanded Sample Messaging:"This year, more than 480 community members walked through our doors seeking support. Of those enrolled in our employment program, 71% secured new jobs or advanced in their current roles within six months. Marcus came to us earlier this year after months of searching for work. With coaching, resume support, and employer connections, he is now thriving in a full-time role with benefits. His success reflects what we strive for every day: unlocking opportunities that change lives."

4. Financial Transparency Statement & Overview

Why it matters:Annual report readers want reassurance that your organization is a good steward of its resources. Clear, honest financial information builds trust with donors and strengthens future grant applications.

What to include:

• A simple revenue vs. expenses breakdown (chart categorization visual)

• Funding sources (grants, donors, corporate partners, events)

• Percentage allocated to programs vs. admin vs. fundraising

• Any financial milestones (e.g., growth in reserves, new funding streams)

• A short explanation of strategy behind spending

Expanded Sample Messaging:"Every dollar entrusted to us carries responsibility. This year, 87% of our total expenses directly supported programs and services. We diversified our funding portfolio by growing corporate partnerships and increasing recurring donor support. These steps help us remain financially resilient while expanding the services our community depends on."

5. Recognition of Partners, Volunteers, and Supporters

Why it matters:People want to feel appreciated, and funders often check this section to understand who you collaborate with. Highlighting partners also reinforces your credibility and community integration. We recommend making different sections depending on how they contributed to your organization.

What to include:

• Community partners

• Funders

• Volunteer groups

• Staff appreciation

• Board recognition

• Collaborative wins

Expanded Sample Messaging:"Our work thrives because of the collective effort of supporters across the community. To our volunteers who logged more than 2,300 hours mentoring clients, to our partners who opened new pathways for training and resources, and to our donors whose generosity sustains our mission — thank you. Each of you plays a vital role in creating life-changing opportunities."

6. Milestones & Organizational Growth

Why it matters:This section communicates momentum. Funders want to invest in organizations that are evolving to community needs, strengthening their programs, and scaling their impact.

What to include:

• New initiatives launched

• Expanded programs

• Awards or recognition

• Internal improvements (new systems, staff training, technology upgrades)

• Growth in reach, partnerships, or capacity

Expanded Sample Messaging:"One of our proudest milestones this year was launching our Small Business Support Initiative, helping 73 entrepreneurs access funding and technical assistance. We also redesigned our client intake system, making it easier for individuals to access services quickly and efficiently. These milestones strengthen our ability to meet needs in real time and serve our community with excellence."

7. A Forward-Looking Message (Vision for the Year Ahead)

Why it matters:Your annual report should end with hope and direction. This message invites donors and partners into what comes next  and creates a sense of momentum and shared purpose.

What to include:

• Priorities or goals for the coming year

• Areas of investment or improvement

• New partnerships or initiatives on the horizon

• A vision that inspires confidence and excitement

Expanded Sample Messaging: "As we look to the year ahead, we remain committed to innovation and responsiveness. We will expand our workforce development initiatives, deepen our small business support programs, and strengthen data tools that help us understand and improve client outcomes. With your continued partnership, we’re ready to meet the evolving needs of our community and create pathways that uplift every person who walks through our doors."

8. Optional Sections to Strengthen Your Report

Why they matter:These additions help round out your story and give your audience more ways to understand your impact.

Consider including:

• Client testimonials in quote form (highly recommended)

• A “Year in Photos” collage

• Staff or volunteer spotlights showing the people behind the work

• DEI progress updates

• Timeline of key events

• Geographic impact map showing reach across NC or the U.S.

• Infographics summarizing outcomes

The Bottom Line

A strong annual report tells a clear, honest, and inspiring story — one that blends narrative, data, financial transparency, and a forward-looking vision. When crafted well, it becomes one of your most powerful tools for building trust, strengthening relationships, and supporting future grant success.