1. The first reason for doing an annotated bibliography is that it is one of the best ways to prepare for the research project. The researchers will always have to spend some of their time collecting reference material for their project and they will have to look at various sources for doing so. But when they have to write annotations for each source, they will have to read the content prepared in those sources more carefully. They will have to mark the key points from each source. The fact that they then have to write it in their own words and even condense the content that has been given means that they are in an ideal position to learn all the information and absorb it completely.
2. An annotated bibliography helps with a critical analysis of the source material. It is quite easy for the scholar to just write down a source name in his project and be done with it. But when he has to prepare an annotated bibliography, he has to critically analyse what has been written and arrive at his own judgements.
3. It is a useful system of comparing the research done in the literature and what the points of view of the researchers are. It is possible to judge if the ideas of the researchers are in sync with what has been given in the literature or are they totally at odds with each other.
4. It is a way of helping future research projects. The points given in the annotated bibliography can give reference points and research material to every interested reader. Future researchers will have a much better idea of what the purpose and main points of this body of work were.