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Financial Ltd profits fall as it makes £1.5m complaints provision

Financial Limited has posted a pre-tax profit of £165,000 for the year ending 31 March, down by 51 per cent from £341,000 in 2010/11, and set aside £1.5m for complaints.

The IFA network’s complaints provision has risen by 170 per cent from £570,000 in 2010/11. The firm says it has increased adviser fees as a result of the fall in profitability.

Revenues at the firm rose by 3 per cent from £25m in 2010/11 to £25.6m in 2011/12.

The firm’s accounts state: “The difficult trading conditions continued in 2011 and the company underachieved its sales targets resulting in a fall in profitability.

“The business plan has been revisited and a further price increase has been communicated to members, which should show the company returning to previous profitability levels.”

Brunning Newman Houghton director David Brunning says: “There are lots of ambulance chasers out there urging clients to complain about every aspect of financial services.

“Both sole traders and larger firms need to make sure they are bolstered with provisions against complaints. They also need to ensure they have the right compliance processes in place to minimise exposure to complaints.”

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