XHTML 1.0 Transitional requires an alt attribute on all images, and if you plan to serve it as text/html (thus making the choice of XHTML pointless but allowing "older" browsers (like GoogleBot and Internet Explorer 7) to cope) then Appendix C requires a space before the "/" at the end.

<img src="htdocs/test/DailyReport.jpg" alt="Suitable Text alternative" />