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Openwork posts £13.3m pre-tax loss

Openwork has reported pre-tax losses of £13.3m for 2011 as it made a £2.2m complaints provision, a £6.1m writedown of company assets and spent around £7m on RDR preparation.

The loss is in comparison to the pre-tax loss of £8.7m posted in the previous year. The complaints provision represents an 8 per cent decrease from the £2.4m set aside in 2010.

The firm says the writedown relates to the overvaluing of IT equipment in its 2010 accounts while £1.8m of the complaints provision was utilised during the year.

It says the £7m costs relate to retraining staff and reducing numbers ahead of the RDR.

The firm’s IFA arm 2Plan made a £1.6m pre-tax loss, compared to nil the previous year.

Openwork adviser numbers fell 3 per cent to 2,003 from 2,060, excluding 258 2Plan advisers.

The firm’s accounts also reveal during 2011 the loan facility offered by parent company Zurich, was extended from £18m to £30m. As of December 31, £12.4m of the loan had been used.

A statement in the firm’s accounts says: “In the lead up to the implementation of RDR in 2013 the group is continuing to invest in the evolution of its business model and in supporting its advisers as they similarly prepare their business for the anticipated regulatory changes.”

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