On the basis of use, reports are classified as Informational report and Analytical report. These reports differ in a variety of ways. Some of the distinctions between them are presented below:
- Definition: An informational report is one that contains details information without analysis or recommendation
- Objective: The objective of informational report is to carry information from one area of business to another.
- Readers/users: Officers, board of directors and stockholders of the company usually read such a report.
- Example: Annual reports, progress reports, statement of policies and procedures etc are the examples of informational report.
- Length: Length of informational report is relatively short.
- Proficiency of the reporter: Preparation of informational report requires clerical efficiency.
- Decision making: Since informational report presents information without analysis and interpretation, it is less helpful in making instant decision.
- Definition: Analytical report is one that presents, analyzes, interprets information and makes recommendations on complex and critical problems.
- Objective: Objective of analytical report is to solve problems.
- Readers/users: Top-level management is the target reader of analytical report.
- Example: Examples of analytical reports are suggestion reports, recommendations reports, justification reports etc.
- Length: Analytical report has the maximum length.
- Proficiency of the reporter: In order to prepare analytical report, the reporter must have analytical and interpretative knowledge.
- Decision making: Since analytical report interprets information and makes recommendations, it is useful in making instant decision.