What type of document is considered an investment circular?

An investment circular is commonly understood to be a formal document that provides detailed information to potential investors, often in the context of a new investment opportunity, such as a share offering. This document is typically structured to meet regulatory requirements, offering transparency and full disclosure about the investment, the entity seeking funds, and the associated risks and rewards.

A prospectus or circular to shareholders falls squarely within this definition. It contains essential information that aids investors in making informed decisions regarding their investments. This may include financial statements, descriptions of the business model, management discussions, and details about the terms of the investment. Such comprehensive disclosure allows shareholders and potential investors to understand the offering fully.

In contrast, the other options do not fulfill the criteria of an investment circular. An advertising flyer is primarily promotional and does not typically provide the in-depth information required for investment decisions. A report on financial performance might contain valuable insights into past performance but does not serve as a comprehensive investment pitch or disclosure document. A summary of employee benefits is focused on employee-related information and has no relevance to potential investors or investment decisions. Thus, the prospectus or circular to shareholders stands out as the correct example of an investment circular.