CAPITA PLC: Annual Financial Report

3 April 2013 
                              Capita plc                                    

                                (the "Company")                                

Annual Financial Report

Capita plc will hold its Annual General Meeting at 11.00am on Tuesday 14 May
2013 at Deutsche Bank, 1 Great Winchester Street, London EC2N 2DB.

Pursuant to Listing Rule 9.6.1, copies of the following documents have been
submitted to the National Storage Mechanism and will shortly be available for
inspection at

- Annual Report and Accounts for the year ended 31 December 2012

  * Notice of Meeting for the 2013 Annual General Meeting
      * Form of Proxy
    These documents are available on the Company's website:

Contact: Francesca Todd, Deputy Group Company Secretary, 020 7202 0641

A condensed set of the Company's financial statements and information on
important events that have occurred during the financial year and their impact
on the financial statements, were included in the preliminary results
announcement released on 28 February 2013. That information, together with the
information set out below, which is extracted from the Annual Report and
Accounts 2012, is provided in accordance with the Disclosure and Transparency
Rule 6.3.5. This information should be read in conjunction with the Company's
preliminary results announcement. This announcement is not a substitute for
reading the full Annual Report and Accounts 2012.

Principal risks and uncertainties

Managing our risks

Effective risk management not only acts to protect and maximise the financial
performance of the business, it also offers the opportunity to safely undertake
more complex, operationally challenging projects and attract the higher reward
that comes with the ability to effectively manage risk. The Group Board is
responsible for ensuring that an appropriate risk management framework is in
place, with relevant systems and controls to identify, assess and mitigate
major business risks that could impact the delivery of our growth strategy.

The Capita Risk Appetite Statement, is subject to regular review as the Group's
plans, controls and level of risk maturity develop over time. It provides a
consistent reference point for the alignment of risk taking and risk management
throughout the organisation and is reviewed and adopted at divisional and
business unit level as applicable.

Implementation of risk management is aligned with Capita's decentralised
business model. Each Divisional Director and/or senior management of the
underlying business unit, is responsible for establishing processes and
procedures to capture, manage, and report on the risks for which they are
accountable in accordance with the agreed Group framework.

Capita operates the `three lines of defence' model, with line management
responsible for the first line, Risk and Compliance for the second line, and
Group Internal Audit for the third line.

Key risk       Potential impacts      Mitigating activities include            

Financial      - Adverse effect on    - Financial performance of each business  

               financial performance  unit is monitored monthly                
               and brand reputation.                                           
                                      - Capital expenditure is subject to      
                                      rigorous monitoring and budgetary        

Delegates and  - Reputation risk and  - Rigorous risk-based due diligence      
counterparty   financial loss e.g.    processes for the selection of key       
failure        disruption to supply   delegates and wider counterparties        

               chain; service         monitoring                               

Operational    - Failure to meet      - Operating frameworks and business      
risks          contractual service    resilience arrangements in place          

               level agreements                                                
                                      - Operating performance indicators       
               - Financial penalties  reviewed by line management              
               - Potential loss of    - Risk committees and Group Board        
               contracts              escalation as appropriate                
               - Brand reputation     - Risk based independent assurance       
                                      - Business resilience arrangements in    
                                      - Centralised proactive and reactive PR  
                                      team provides full issues management     
                                      communications support                   

Acquisitions   - Planned synergies    - Rigorous risk-based due diligence      
and organic    not achieved                                                    
growth                                - `Black Hat' process:                    

               - Adverse impact on                                             
               financial growth and   - Fit with strategy and pricing is       
               performance            subject to review and approval by the    
                                      Group Board                              
               - Financial penalties.                                          
                                      - Appropriate contractual terms to ensure
                                      fair risk/reward profile                 
                                      - Robust integration and transition      

Economic       - Weaker economic      - Focus on 10 diverse public and private 
landscape      conditions are a key   sector markets                            

               driver for                                                      
               outsourcing, however,  - Focus on widening scope of existing    
               extreme economic       contracts to help clients save money     
               uncertainty can result                                          
               in a delay in buying   - Supply of services that support        
               decisions and lower    essential client functions rather than   
               discretionary spend    discretionary activities                 
               across some market                                              
               segments.              - Initiatives to increase the efficiency 
                                      of Group operations.                     

Attract and    - Lack of appropriate  - Training and development               
retain         resources may lead to                                           
employees      inability to develop   - Continual development through objective 

               and execute business   setting and appraisals                   
                                      - Competitive incentive and bonus plans  
               - Poor employee morale                                          
                                      - Succession planning                    
               - Competitive                                                   
               disadvantage.          - Comprehensive vetting process in line  
                                      with roles.                              

Loss of        - Contractual and      - Appropriate policies and procedures    
sensitive or   regulatory penalties                                            
confidential                          - Robust information security framework, 
data           - Adverse media        including policies and processes          

               comment and reputation                                          
               impact on brand.       - Escalation to risk committees and      
                                      subsidiary boards                        
                                      - Training and monitoring programme      
                                      across businesses                        
                                      - Swift adoption of Group policies and   
                                      protocols by newly acquired businesses   
                                      - Sharing of best practice and issues    
                                      through cross-Group forums               
                                      - Regular monitoring through risk-based  
                                      audits and follow-up of actions          
                                      - Centralised proactive and reactive PR  

IT risks       - Failure to support   - Adoption, implementation and audit of   

               core services and      industry recognised controls             
               business needs                                                  
                                      - Regular and documented disaster        
               - Inability to provide recovery tests                           
               adequate disaster                                               
               recovery services      - Regular audit of services and systems  
                                      to validate adequacy of protective       
               - Failure to protect   controls and processes                   
               client and Capita                                               

Fraud, bribery - Potential for civil  - Appropriate policies and procedures in 
and corruption and criminal penalties place including a `speak up' policy       

               for business and/or                                             
               senior officers        - Anti corruption culture and a zero     
                                      tolerance approach with a robust         
               - Potential            disciplinary process                     
               prohibition from                                                
               bidding for public     - Risk assessments of vulnerabilities    
               sector contracts in EU                                          
                                      - Monitoring and audit                   
               - Media comment and                                             
               reputation impact.     - Centralised proactive and reactive PR  

Regulatory     - Non-compliance with  - Appropriate policies and procedures    
landscape      the requirements of                                              

               our regulatory bodies  - Monitoring by Risk, Internal Audit and 
               in the UK or overseas  Regulatory Compliance teams              
               (including the                                                  
               Financial Services     - Escalation of risks to risk committees 
               Authority in respect   and subsidiary boards                    
               of regulated UK                                                 
               financial services     - Risk-based assurance and actions for   
               business)              improvement                              
               - Regulatory,          - Independent reporting to Group Audit   
               financial and          Committee and Group Financial Services   
               contractual penalties  Risk & Governance Forum.                 
               - Adverse impact on                                             

Health and     - Non-compliance with  - Rigorously applied health and safety   
safety         health and safety      policy and processes                      

                                      - Health and safety training             
               - Adverse impact on                                             
               wellbeing of our       - Comprehensive Group wide health and    
               employees.             safety audits undertaken twice a year.   

Environmental  - As a low impact      - Raising awareness of environmental      

               company our key        issues and Group sustainability          
               environmental impacts  initiatives                              
               are energy use,                                                 
               business travel,       - Continue to measure and manage our     
               resource use and waste carbon footprint and achieve energy      
               management which we    reductions.                              
               manage proactively.                                             
                                      - Environmental management system in     
                                      - Environmental site audits carried out  
                                      twice a year                             
                                      - Reduction of paper use and increase in 

Related party transactions

Compensation of key management personnel
                                                2012                      2011

Short term employment                            7.6                       5.5
Pension                                          0.1                       0.2 
Share based payments                             3.6                       3.6 
Total                                           11.3                       9.3 
Gains on share options exercised in the year by key management personnel
totalled £4.6m (2011: £5.8m). 
Nigel Wilson, who was Senior Independent Director until his resignation from
the Board on 31 December 2012, was Group Chief Financial Officer of Legal &
General Group Plc until June 2012 when he was appointed as Chief Executive
Officer of that group. The Legal & General Group Plc had an interest in
23,279,554 shares in Capita plc as at 20 February 2013 and has a contractual
relationship with the Group. Nigel Wilson did not participate in any Legal &
General board discussions or decisions in respect of that company's dealings
with Capita plc which are conducted on an arm's length basis. 
Pursuant to the Company's share placing which completed on 24 April 2012, funds
managed by Invesco Limited, a substantial shareholder in the Company and
therefore a related party of the Company (in each case, for the purposes of the
Listing Rules of the UK Listing Authority), subscribed, pro rata to their
previously existing holdings, for an additional 8,000,000 shares in the Company
at the placing price of 685p representing an aggregate further investment of £
54.8m. In addition, Invesco acquired a further 16,459,384 shares during the
year at market value. 
Statement of Directors' responsibility 
The Directors confirm that, to the best of their knowledge: 
a) the consolidated financial statements in this report, which have been
prepared in accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union, IFRIC interpretations and those parts of the
Companies Act 2006 applicable to companies reporting under IFRS, give a true
and fair view of the assets, liabilities, financial position and profit of the
Group taken as a whole; 
b) the parent company financial statements in this report, which have been
prepared in accordance with United Kingdom Accounting Standards (UK GAAP) and
applicable law, give a true and fair view of the assets, liabilities, financial
position and profit of the Company; and 
c) the management report contained in this report includes a fair review of the
development and performance of the business and position of the Company and the
Group taken as a whole, together with a description of the principal risks and
uncertainties that they face. 
By order of the Board 
P R M Pindar             G M Hurst 
Chief Executive          Group Finance Director 
27 February 2013 
-0- Apr/03/2013 10:03 GMT
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