In a six monthly report to creditors published yesterday PwC said it had taken fees of £1.74m plus Vat at 15 per cent in relation to its accrued time costs which totalled £4.68m.
It has not drawn £4.68m in full to ensure there are sufficient funds to continue to trade the Keydata Reading office. The time costs comprise of 13,283 hours at an average charge out rate of £352.31.
At the date of its appointment on June 8, PwC transferred pre-appointment balances totalling £2.95m held in Keydata’s corporate accounts into its administration account.
PwC can only draw its final remuneration after all trading costs have been paid in full from the balance in hand in the administration, which stood at £1.93m as at December 7.
In an update on ongoing delays to income due to investors with Keydata plans invested with Lifemark, PwC said it had received assurances from provisional administrator KPMG in Luxembourg that: “the position will be regularised soon and all arrears of income payments and an agreed commission will be paid to us by the end of January 2010.”
PwC said Lifemark owes Keydata £3m for these outstanding commission payments to the end of October 2009. Around £349m was invested by Keydata clients in the Lifemark plans. It said the level of dividend available for preferential and unsecured creditors is dependent on the receipt of commission payments from Lifemark.
PwC added that unless a secondary market can be established for the Lifemark backed plans, clients will be unable to surrender and encash their investments and will be forced to hold them until maturity.
It said: “On a worse case basis, if we do not receive any commission payments there will be no dividend for preferential or unsecured creditors. However, if commission payments are received it is possible that preferential creditors will receive a 100p in the pound and unsecured creditors may receive a nominal dividend, after Credit Suisse’s loan (£3.2m) is repaid in full.”
PwC expects to transfer all investment products administered on behalf of third parties to other managers leaving it with responsibility for Keydata’s life settlement products and income property bonds only.
Keydata services around 260,000 investors with investments totalling around £2.85bn.