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An annual report is a document required for state compliance, which varies by state. It serves as a regular check-in that businesses must complete. The speaker emphasizes that this information is general knowledge available online and not legal or financial advice. They refer viewers to a previous video that provides a more detailed explanation of state compliance, indicating that the annual report and state compliance are closely related concepts. The tutorial is intended for educational purposes, highlighting the importance of understanding annual reports in the context of state regulations.