This is taken from Firstport Group accounts.
THE GROUP MANAGES A LARGE NUMBER OF COMMERCIAL AND RESIDENTIAL DEVELOPMENTS.
THERE ARE HISTORICAL ISSUES WITHIN THIS SIGNIFICANT PORTFOLIO WHICH HAVE GIVEN RISE TO SOME DISPUTES AND CLAIMS.
MANAGEMENT CONTINUE TO DEFEND THESE CLAIMS VIGOROUSLY AND SUCH CLAIMS MAY TAKE MANY YEARS TO RESOLVE, SO MANAGEMENT HAVE RECOGNISED THE NEED FOR A PROVISION OF 9,437,066 POUNDS.
So out of a service charge fund of approximately 200m pounds, 9.5 m pounds had to be set aside not for Firstport administrative errors, but for irregularities that residents have spotted and have had to fight Firstport to rectify.
If residents either give up (due to stress) or agree a lower figure to settle the true amount is not provided for.
Remember Firstport refer to "disputes or claims" So if the resident doesn't notice an error it does not form part of the provision set aside in Firstport's accounts.
It does seem very probable that the true figure for funds oqing to residents is more likely to be three times that figure ie approximately 28m pounds.
For a company with a net negative value of minus 7m pounds this is not encouraging!
