Final answer:
The descriptive sections of the annual report that provides insight into what the company does and the types of risks it faces is referred to as the Management's Discussion and Analysis (MD&A).
Step-by-step explanation:
The descriptive section of an annual report that provides insight into what the company does and the types of risks it faces is known as the Management's Discussion and Analysis (MD&A). This section gives a detailed analysis of the company's operations, performance, financial condition, and risks in a narrative format.
The MD&A provides information about the company's strategies, trends, and challenges, allowing stakeholders to understand the company's overall situation. It helps investors, analysts, and other interested parties make informed decisions about the company.
For example, in the MD&A, a technology company may discuss their research and development efforts, market trends, regulatory risks, and potential competition in the industry.