Data Visualization and Infographics in 10-K Filing

The Securities and Exchange Commission encourages the presentation of financial data and information in graphical form (infographics) to assist users in better understanding financial disclosures. We find a significant increase in the use of infographics in 10-K filings from 2002-2017. Consistent with infographics improving the clarity of financial disclosures, we find a significantly positive association between the use of infographics and annual report readability. Further, we find that firms use GAAP-related infographics when earnings are more persistent and non-financial key performance indicator infographics when earnings are less persistent, consistent with firms using data visualization to emphasize the information that is most relevant in helping stakeholders to understand company performance. Overall, our evidence suggests that infographics are an important element of corporate disclosure that managers use to communicate with stakeholders.