The correct answer is: To set out the directors' analysis of the business, in order to provide investors with a historical and prospective view through the eyes of management.

Rationale: This is the definition used by the Accounting Standards Board.

'To provide the London Stock Exchange with a statement as to whether or not they complied through the accounting period with the provisions set out in the Combined Code' and 'To provide a statement that the company is a going concern' are other corporate governance reports that may be required (the former being a requirement of the London Stock Exchange).

'To provide the board of directors with a narrative statement by the audit committee of its findings on the efficacy of internal operational and financial controls' is just a distractor.