Brewin Dolphins takes £32m hit on IT implementation U-turn
14 May 2014 | 4263 views | 1
Investment management firm Brewin Dolphin has warned that it will take a £32 million hit after pulling a planned IT operating system implementation.
The firm began rolling out the Figaro platform from vendor JHC at its Stocktrade execution-only service in 2011 but soon uncovered problems with the "functionality and robustness" of the software.
Although Brewin is sticking with Figaro for Stocktrade, it has scrapped plans to extend the software to its discretionary wealth management business.
The decision will lead to an exceptional pre-tax impairment charge of around £32 million, to be taken in the second half of this year. The company is also negotiating with its IT supplier, with which it is locked into a £15 million, ten year contract.
Brewin says that instead of the Figaro system, it will upgrade existing software to the latest versions commercially available and this can be done without additional capital expenditure beyond that already budgeted.