Wheatley: £3.2m software write-off was a mistake

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A £3.2m write-off for software licences bought but not used by the FCA has been described as a “mistake” by outgoing chief executive Martin Wheatley.

Earlier this month the regulator’s annual report revealed it had entered into a one-year contract in May 2014 to purchase several software licences.

The FCA pre-paid in order to receive a discount, but said “utilisation” of the licences “had not materialised as anticipated”, resulting in £3.2m being written off.

Responding to a question from Money Marketing at the FCA’s annual public meeting today, Wheatley said: “We have made one or two mistakes and that write-off was one of them.

“We are pretty disciplined about how we run our budget and it is unusual for us to find ourselves in a position where we run over.”

The regulator made a £58.3m loss in the year to 31 March 2015, driven by losses in its defined benefit pension scheme and consumer credit costs.

Asked what assurances the FCA can give that it will keep within its budget in 2015/16, chairman John Griffith-Jones said “unexpected items” are par for the course.

He said: “Last year we had a deficit in the accounts overall but that was planned because we didn’t collect consumer credit fees until consumer credit regulation started operating.

“Do we aim to run to the budget? Yes we do. Do you in organisations of our size have one or two unexpected items of good and bad over the course of the year? Sadly, yes. But it is the responsibility of the organisation to keep the bad ones to an absolute minimum.”