Corporate Annual Report Graphical Communication in Hong Kong: Effective or Misleading?
John K. Courtis · Journal of Business Communication · 1997
Graphical presentation of quantitative data within corporate annual reports hasbecome one of the techniques used by management to disclose quantitativeinformation. The purposes of the paper are (a) to review the normative advantages and limitations of graphs in corporate reporting, and (b) to extend ourknowledge about the presentation of annual report chart graphics by examiningAsian (Hong Kong) data. Two surveys of chart graphics were undertaken: 140annual reports for 1992-1993 and 114 for 1994-1995. It was found that 38% and35% of companies respectively for each of the two time periods include chartgraphics. However, the second survey found the surprising and disturbing resultthat the construction techniques used in approximately half of all graphs violatesound principles and are therefore misleading. Because misleading graphsoccur across all industrial sectors, violations may be the result of preparerignorance and carelessness rather than wilful manipulation to deceive. Withoutobjective evidence about this, professional management and accountancyorganizations probably need not yet draft construction guidelines for annualreport preparers.