Focus Solutions Group plc
Annual Report & Accounts
Year Ended March 2004 Contents
1 Key Highlights  2 Technology Overview  4 Chairman’s Statement  6 Chief Executive’s Statement  8 Board of Directors
9 Directors’ Statement on Corporate Governance  11 Directors’ Report  13 Remuneration and Nomination Committee’s Report
17 Directors’ Responsibilities  18 Independent Auditors’ Report  19 Consolidated Profit and Loss Account  20 Group Balance Sheet
21 Company Balance Sheet  22 Consolidated Cash Flow Statement  23 Notes to the Financial Statements
36 Advisors and Shareholder Information
Creative solutions for the world of
to become the leading provider of
electronic trading solutions to the financial
services market using goal:technology
to exploit the potential of goal:technology
in new markets through partners
There are two key elements to Our Strategy:
Focus Solutions Group design, deliver and implement
customer management solutions for the UK financial services
market using goal:technology, its innovative XML toolkit. Focus Solutions Group plc Annual Report & Accounts 2004 1
ecommerce
Key Highlights
Operating Profit/Loss Before Interest £’000s Revenue Growth £’000s
Turnover down 18% to £5.4 million (2003: £6.6 million)
goal:technology licence and related services revenue up 30% to £3.7 million (2003: £2.8 million)
Loss before tax reduced by 90% to £0.4 million (2003: £3.8 million)
First ever operating profit generated in second half of £0.1 million (Second half 2003: £1.1 million
Operating Loss)
Cash and money market deposits of £1.5 million (2003: £1.7 million); debt free
Loss per share reduced to 1.0 pence (2003: 13.4 pence loss)
Entry into UK mortgage market with contracts signed with Kensington Mortgages Limited
(“Kensington Mortgages”) and Network Data Limited (“Network Data”)
Major contract wins during the year include:
– Winterthur Life UK
– The Exchange (Marlborough Stirling)
– Major UK Bank
500
0
-500
-1000
-1500
-2000
FY02 H1 FY02 H2 FY03 H1 FY03 H2 FY04 H1 FY04 H2
1123
1597
1262
1890
90
679
7000
6000
5000
4000
3000
2000
1000
500
0
FY2001     FY2002     FY2003  FY2004
5,388
2,273
5,073
6,583
£’000
£’000 Technology Overview
‘goal:technology offers considerable benefits to organisations
looking to build reusable, strategic application components, and offers
a faster time-to-market for new development initiatives.’ Butler Group, September 2003
The characteristics of 21st century
software are demanding and require
technology to be easy to use, quick
to deploy and deliver a return on
investment (ROI) within short
timescales.
The key differentiator for a 21st
century technology is that it must
eliminate the legacy issues of
traditional technology and be ‘built
to change’ to enable applications
and solutions to adapt quickly to
environmental and business change.
Focus’ core product, branded
goal:technology, delivers all the 
characteristics associated with 21st
century technology and enables an
organisation to future proof both
their e-commerce solutions and
their investment. goal:technology
is an XML-based toolkit that enables
a non-technical user to design, build
and integrate applications for the
capture, validation and transmission
of complex data.
Solutions
goal:technology is already well
established within the UK life and
pensions market with:
 40,000 licenced users
 The top ten leading life &
pensions insurers as customers
 100% coverage of the main UK
Independent Financial Adviser
(IFA) portals
Focus has used goal:technology
to build a customer management
solution for the financial services
market. Multi Channel Advice
(MCA), is a single solution for
effective electronic trading across
multiple distribution channels,
online or offline.
MCA enables an insurer or lender to
automate components of its sales
process by building a series of
reusable components that can be
deployed in any distribution channel
including IFA portals, IFA extranets,
Point of Sale solutions, consumer
websites or via a call centre.
Focus has recently launched MCA
into the mortgage market, securing
a contract with Kensington
Mortgages, a subsidiary of
Kensington Mortgages Group plc.
Partnerships
Partnerships are key to Focus’
continued business growth in
extending the reach of
goal:technology and will play
an important role in increasing
the visibility of Focus in new
market areas.
goal:technology channels to market
2 Focus Solutions Group plc Annual Report & Accounts 2004 Focus has established a partnership
programme with three categories
of membership; Service,
Application and Technology
partnerships.
Through the partnership
programme, goal:technology
has been embedded into a
number of partner solutions
and demonstrations.
XFormation
In February 2004 Focus Software
Limited, a subsidiary of Focus
Solutions Group plc, launched
XFormation – the world’s first
commercially available XForms
Integrated Development
Environment (IDE) for the creation
of web forms.
The XForms standard has been
developed by the W3C, the
worldwide community responsible
for the standards that support the
worldwide web. Experience gained
since 1999 in the development of
XML and goal:technology enabled
Focus to take ‘first mover advantage’
in this new market.
XFormation is being distributed
globally through the web at
www.xformation.com.
Focus has been a leading innovator
in its use of XML since its formation,
and plans to continue to extend its
technology to take advantage of
emerging standards and to meet
users changing requirements –
delivering a future proofed solution
for our customers.
Focus Solutions Group plc Annual Report & Accounts 2004 3
goal:technology delivers:
A saving of 62% in development costs compared to a
traditional methodology
A total cost of ownership saving of 50% on a 
single project
Additional deployment savings of 84% when
deployed on more than one channel
goal:technology – reducing the cost of business process automation.
Butler Group September 2003 4 Focus Solutions Group plc Annual Report & Accounts 2004
Alastair Taylor  Chairman
"The Group will continue to move towards delivering value for
shareholders by strengthening its position as the leading provider of
electronic trading solutions to the life and pensions market and exploiting
the opportunities emerging in the mortgage market. " Alastair Taylor, Chairman
Chairman’s Statement
Business review
Last year, we promised to continue to
reduce costs and to target resources to
maintain the Group’s improving financial
performance. This we have done. Despite
continued tough trading conditions in
our core UK life and pensions market, I
am pleased to report that the Group has
made excellent progress during the year.
Pre-Tax Losses were significantly reduced
to £0.38 million, down from £3.8 million
last year. During the second half of the
year, the Group reported an operating
profit of £0.1 million and generated cash
from trading for the first time. These are
landmark events in the Group’s
development.
Total sales revenues were down 18% to
£5.4 million reflecting the changing mix
of revenue in the business as sales of
goal:technology licences and services
continued to grow strongly, up 30%, and
the completion of the major Point of Sale
(POS) solution developed for Norwich
Union resulted in an anticipated revenue
decline. The business has matured
during the year and given our recent
success in entering new market sectors,
we look to the future with optimism.
The Group has continued to expand its
market share in the UK life and pensions
market. With the sale of e-business
components to Clerical Medical, part of
HBOS Group, and of a Multi Channel
Advice (“MCA”) solution to another
leading life and pensions provider
during the period, all of the top ten UK
life and pensions companies now use
MCA solutions components based on
goal:technology. Whilst the majority of
turnover came from our existing
customer base, new customers during
the year also included Winterthur Life UK
and Webline in the life and pensions
market, Network Data and Kensington
Mortgages in the mortgage market, and
a leading high street bank.
Our market leading MCA solutions are
widely recognised, having won the 'Best
use of IT in insurance' category at the
Financial Sector Technology Awards for
the past two years, last year for Norwich
Union’s RIO project and this year for
Zurich’s ETi project.
During the year, Milliman USA Inc, a
leading North American actuarial services
business acquired the business and
liabilities of Focus Solutions Inc, a wholly-
owned subsidiary of Focus Solutions
Holdings Inc (“FSHI”) in which Focus had
retained a 49% investment since the
disposal of 51% of the issued share
capital of FSHI to management last year.
As part of the acquisition agreement,
Milliman has signed a new three year
licence agreement with the Group,
ensuring that Focus will benefit from any
future revenue based on the use of
goal:technology through royalty
payments. Initial progress is encouraging,
although this is unlikely to result in
substantial revenues in the short term.
In February, we launched XFormation,
the world’s first commercially available
XForms Integrated Development
Environment (IDE) for the creation of
web solutions. Incorporating technology
supplied by x.port.net Limited,
XFormation is a generic XForms based
toolkit, supporting the next generation
of forms technology that is set to
replace HTML forms. XFormation has
global application across all industry
sectors.
During the year, we secured our first
orders for MCA solutions for the UK
mortgage market, with Network Data
and Kensington Mortgages. While not
significant in terms of value, these
contracts are very significant for the
business, particularly the provision of an
online mortgage application system to
Kensington to enable brokers and
intermediaries to transact electronic
new mortgage business directly via the
Internet.
Review of results
Turnover for the year ending 31st March
2004 was £5.4 million compared with
£6.6 million in the previous financial
year. This reduction was principally the
result of the completion of the Norwich
Union Point of Sale solution, RIO. In
contrast, sales of goal:technology and
associated services increased by 30%
from £2.81 million to £3.67 million and
now represent 66% of turnover,
compared with 43% last year.
Despite the decline in sales revenues,
we reduced our loss before tax to
£0.38 million compared to £3.8 million
last year. In the second half of the year,
the business generated a profit of
£0.28 million. This is the first six month
period in the Group’s history in which
we have generated a profit.
The progress made towards profitability
in the year, was largely achieved by
reducing administrative expenses from
£9.60 million last year to £5.98 million
this year. Cost reductions achieved in
the first half of the year fed through into
a much improved performance in the
second half. The monthly administrative
costs of the business have been reduced
to £0.42 million in the second half of the
year, equivalent to annualised costs of
£5.03 million. Substantial savings were
made at an executive level, in Focus Solutions Group plc Annual Report & Accounts 2004 5
administrative areas and in professional
service delivery, particularly in relation
to the RIO project. However, we
maintained our investment in research
and development, sales and marketing
and in our partnerships team, as it is
these areas that will develop and grow
the business in the future. Investment
in these areas will continue at similar
levels in FY2005, while we maintain
stringent control over all areas of
expenditure.
Losses after tax were £0.28 million
against £3.43 million last year, after a
corporation tax credit of £0.1 million
against the costs of investment in
research and development for the year
ending March 2003.
Cash outflow from operating activities
during the year totalled £0.9 million
(FY2003: £2.4 million). During the year, a
total of £0.7 million was raised from
share placings or the exercise of share
options. In the second half of the period,
the Group generated £0.2 million of
cash from its trading activities. This is the
first period in the Group’s history when it
has achieved this. Cash and money
market deposits at 31st March 2004
were £1.5 million, compared with £1.3
million at 30th September 2003 and £1.7
million at the end of the last financial
year, and the balance sheet remains
debt free. During the year, we did,
however, negotiate bank facilities
totalling £350,000 with HSBC plc, should
we require them.
Loss per share for the year ending
31st March 2004 was 1.0p, compared
with a loss of 13.4p for the year ending
31st March 2003.
The Board’s primary objective is to
provide the resources necessary for the
business to grow and create a business
of sustained profitability and cash
generation. In the long term, this
represents the best opportunity for
return on investment. Accordingly, we
currently have no plans to pay a
dividend in the near future.
Research and development
The investment in research and
development and in product
development is substantial and totalled
£0.9 million in FY2004 (FY2003: £1.0
million). This investment is fully written
off in the year in which it is incurred. The
Group benefits from the research and
development tax credits and has made a
provision in the accounts for the credit
due for FY2003. No provision has yet
been made for FY2004, pending
agreement of the FY2003 submission.
People
The Group has achieved much since
flotation on AIM in March 2000. We now
face different challenges and during the
year a number of changes to the Board
were made to help take the Group
forward to its next phase in its
development.
Martin Clements was appointed to the
Board as Finance Director on June 12th
2003 when Sue Hele stepped down as
Finance Director. As Focus enters the
next phase of its development, the
Group will benefit from Martin’s
experience in developing high profile
software companies both in the UK and
internationally. I would like to extend my
thanks to Sue for her commitment and
contribution to the Group during the
previous two and half years.
Bob Hull retired as a non-executive
director and Company Secretary on 25th
September 2003 after nearly five years
involvement with the Group, including
acting as Finance Director at the time of
the AIM flotation. We remain extremely
grateful to Bob for his efforts at the time
of the float and for his continued wise
counsel since that event. I would like to
wish him all the best in his future
endeavours.
The improved financial performance of
the Group is a testament to the
reputation of our staff for both their
technical expertise and responsiveness to
customer requirements. To achieve these
results in the current environment has
required both flexibility and commitment
from our staff. These challenging times
have created many pressures, in spite of
which our team has continued to exceed
our expectations time after time. I thank
all of them for their continued
commitment to Focus and for their
achievements and enthusiasm.
Outlook
Whilst the whole financial services
market remains volatile, insurance
companies and others in the financial
services industry are moving steadily
towards electronic trading. Over the next
year, a number of significant changes in
regulation are likely to accelerate this.
However, customers are still reviewing
expenditure carefully. Consequently, we
will continue to contain costs and target
resources to maintain the Group’s
improving financial performance in this
challenging environment. The Group will
continue to move towards delivering
value for shareholders by strengthening
its position as the leading provider of
electronic trading solutions to the life
and pensions industry and exploiting
the opportunities emerging in the
mortgage market. We will continue
working to fully exploit the potential of
our MCA solutions based on
goal:technology, supporting our new
product, XFormation, and developing
partnerships to help us penetrate other
market sectors and regions. 6 Focus Solutions Group plc Annual Report & Accounts 2004
Focus Solutions and Zurich won ‘Best use 
of IT in insurance’ at the 2004 Financial Sector
Technology Awards 
Chief Executive’s Statement
Last year was a difficult year in the UK
insurance market. Against this backdrop,
Focus was also managing a major
transition in its business as the Norwich
Union POS solution, RIO, was coming to
the end of its development cycle in terms
of revenue generation. In this tough
environment, Focus delivered a very
encouraging performance, with 30%
growth in sales of goal:technology and
associated services, the successful launch
of XFormation and the signing of the first
partnership deal with Milliman. 
Underpinning our plans for the Group has
been the recognition that we must make
the business sustainable and scalable. 
In terms of sustainability, it is our
objective to extend the customer base
by entering additional market sectors.
A key medium term objective is for our
recurring revenues to substantially cover
our fixed cost base. While we remain
someway from achieving this goal,
substantial progress was made in the
year. In the short term, our solutions
business is close to sustainability based
on our established strategy for the
design, delivery and implementation of
world class e-trading solutions based
around our MCA components for the
financial services markets, built using
goal:technology, our XML toolkit.
In terms of scalability we see the
technology side of the business offering
much greater short term opportunities.
The exploitation of goal:technology in
other markets through partners has 
formed a major plank of our strategy for a
number of years. We have now secured
our first partnership arrangement with
Milliman and have an ongoing business
relationships with Fidelity Information
Services. We have also joined the BEA
Partner programme. The development
and launch of XFormation, derived from
the goal:technology family of software,
is moving the business into other non-
financial services related markets. 
MCA solutions for the life and
pensions market
The past few years have been very
difficult for the UK life and pensions
industry, with falling stock markets,
increasing regulation and consolidation in
the industry. The move towards electronic
trading, although slow to take off initially,
is now gathering pace. A recent analysis
of the percentage of transactions now
being delivered electronically shows that
17% were automated in 2003, compared
to 4% over 2002. (Source: Focus Quotient
2003). With all of the top 10 UK life and
pensions companies using
goal:technology, Focus is now a leading
supplier of customer management
solutions to this market, providing one
of the key components required to make
straight through processing of
applications for pensions and insurance
policies a reality. 
Software that incorporates
goal:technology has now been
distributed to approximately 40,000
users within the UK life insurers and
the IFA community. This represents a
significant foothold in our core market
and provides an important reference for
other markets inside and outside the
financial services sector.
During the past year, we have secured
important new business with Winterthur
Life UK, Webline, and Clerical Medical.
Marlborough Stirling’s market leading 
IFA Portal business, The Exchange, 
has signed an agreement to use
goal:technology in its Exweb Gold
service. An established customer, 
Zurich, has radically transformed its
direct sales force POS using MCA based
on goal:technology, over 98% of its
transactions from this channel are now
received electronically. It has also signed
a contract to use MCA for new business
based on goal:technology in its
extranet, allowing the IFA channel to
place transactions online. 
Entry into the mortgage market
During the last twelve months, MCA for
mortgages was selected by Kensington
Mortgages to build a new online
mortgage application system and by
Network Data, a leading mortgage
sourcing company, to support the
provision of mortgage products. Focus
has previously worked with two major
life insurers to develop solutions to
capture and deliver mortgages and
associated general insurance
transactions electronically. With the
proliferation of mortgage products and
the introduction of legislation in
October 2004 to regulate the provision
of mortgage advice, mortgage lenders
are looking for solutions to achieve the
new compliance requirements.
John Streets  Chief Executive Focus Solutions Group plc Annual Report & Accounts 2004 7
goal:technology 
goal:technology, Focus’ XML based
toolkit is designed to enable the rapid
development of components to
automate the sales process. It comprises a
suite of products that enable the simple
design, development and deployment of
complex data capture processes that can
be implemented as a standalone
technology or integrated within existing
products or solutions to significantly
enhance data capture capability. An XML
data capture built using goal:technology
can be reused in multiple business
channels and environments.
As a result, solutions built using
goal:technology are built to change
and are to a large extent “future proofed” .
This compares to the traditional
approach to building software, which has
resulted in many legacy systems with
long lead times for development, and
software that is difficult and costly to
change and maintain.  With speed and
flexibility becoming key differentiators of
company performance, these old models
no longer make commercial sense. 
Our customers are looking for solutions
that enable them to gain competitive
differentiation in their market and that
are flexible enough to allow them to
respond to continuing change in market
conditions. They are looking for fast
development and implementation
timescales, solutions that are built in 90
days, are easy to change and can deliver
a return on investment within the
current budget year. goal:technology
is unique in meeting these requirements
and underpinning the delivery of
solutions to customers facing tough
trading environments. 
goal:technology is generic, and can be
used in a wide range of industries where
the simple creation of sophisticated front
end applications is required. Our
partnership programme has been set up
to extend the reach of goal:technology
into market sectors outside the life and
pensions market, targeting software
companies and systems integrators,
where goal:technology can add value
to their solutions and cut the costs of
development and maintenance. Our US
partner, Milliman, is making good
progress, with goal:technology and is
now ready to deploy solutions for three
large US general insurance companies. 
As standards continue to evolve, we have
made an early move into the XForms
market , which we see as an important
development. XFormation has been
developed as the first working XForms
builder/ processor package and made
available to the wider development
community over the Internet. 
The XForms standard defines a dialect
for the next generation of forms
technology that is set to replace HTML
forms. The new XForms standard has
been developed by the W3C, the
worldwide community responsible for
the standards that support the World
Wide Web. The XForms specification
overcomes current limitations of HTML
and reduces the need for extensive
script when developing interactive web
pages. The XForms standard is device
independent and will allow complex
functionality to be deployed across the
web and on other deployment devices
such as mobile phones or pocket PCs.
This in itself represents a major market
opportunity for other sectors to gain the
advantages currently enjoyed by our UK
life and pensions customers.
Focus will continue investing to ensure
that our goal:technology XML toolkit
exploits the recent advances in data
capture led by the W3C Internet
standards authority.
Strategy
It is our strategy to create a sustainable
and scalable business. The provision of
customer management solutions to the
UK life and pensions market using
goal:technology can generate
sustainable profits in the foreseeable
future, coupled with taking
goal:technology into other associated
markets (such as general insurance and
mortgages). To achieve further growth,
the Board believes there is significant
opportunity in exploiting
goal:technology more widely through
developing partnership agreements
with organisations operating in different
geographical and vertical markets. 
Prospects
Although we expect market conditions
to remain tough in the forthcoming
year, our target market will continue to
look for solutions that cut the costs of
distributing their products and help
them meet the challenge of the new
regulations. We aim to capitalise on our
strong position in the life and pensions
market and build on our initial wins to
establish a presence in the mortgage
market.  We now have a track record of
delivering benefits to customers,
underpinned by innovative software
that has global multi-market potential.
Tight control on costs, coupled with a
closely targeted approach to sales and
partnership development will ensure
that the Group continues to make good
progress in implementing its strategy. 
A Focus POS solution wins FST
‘Best use of IT in Insurance’ award
for 2nd consecutive year
The Zurich Advice Network selected
Focus Solutions to deliver their new
Point of Sale (POS) solution called ETi
(Electronic Trading instantly) using
components of Focus’ Multi-Channel
Advice (MCA) application suite. The two
organisations worked closely together
using a RAD (Rapid Application
Development) approach to facilitate 
a quick delivery. In January 2003 ETi
was rolled out to all 3,500 of ZAN’s
advisers, following just a three-month
development period.
The ETi project exceeded the original
business objectives set by Zurich and
since the implementation has delivered
significant business benefits to the
financial services organisation. Over 
98% of Zurich’s non-regulated business
is now delivered electronically and as a
result of introducing ETi, business
volumes for non-regulated products
have more than doubled and this level 
is increasing still month on month.
In March 2004, ETi won the Financial
Sector Technology 2004 award for the
‘Best use of IT in Insurance’ – the second
consecutive year that a POS solution
built by Focus has won this category.
“The ETi system has transformed the way
we sell our non-regulated business and
feedback from our advisers has been very
positive. ”
Paul Kenmir,
Sales Process Director for Zurich
Financial Services 8 Focus Solutions Group plc Annual Report & Accounts 2004
Board of Directors
Alastair Taylor, Chairman
Alastair was previously the President of the Global Financial
Services Industry business for Unisys Corporation and a member
of the Executive Management Board. During more than 30 years in
the IT industry he has held senior executive positions in the UK
and internationally.
John Streets Chief Executive
John is the founding director of Focus.  John has a 20 year track
record in IT sales and the financial services business working for
Honeywell Information Systems, Wang Computers, Fame
Computers and Intuitive Systems. Focus was established in 1995
following an approach by AT&T to launch their insurance value
added services in the UK and Europe.
Mark Thelwell Chief Operating Officer
Mark joined Focus in 1998. Prior to this, he spent 16 years in
Financial Services, covering sales, marketing and regulation, and
was latterly responsible for implementing end-to-end e-Business
capability. Mark was appointed as Group Chief Operating Officer
on 30 April 2002.
Mark Loosmore Business Development Director
Mark joined Focus in 1998 and on 1 April 2002 Mark was
appointed as Business Development Director concentrating on
developing solutions and partnerships. Previously, Mark worked 
at NCR and AT&T selling complex IT solutions to large insurance
companies.
Frank Murray Chief Technology Officer
Frank joined Focus as Product Development Manager in 
May 2000.  Prior to Focus he spent 18 years in a variety of senior
technical roles with AT&T and Cap Gemini focusing on the
financial services market.  Frank was appointed Chief Technology
Officer on the 1 April 2002.
Martin Clements Finance Director
Martin Clements qualified as a chartered accountant in 1987.
Martin joined Focus from Bond International Software Plc, 
where he was Group Finance Director. Prior to joining Bond,
Martin worked in a number of senior positions with Eurobell
Holdings Plc and Vickers Plc.
Piers Brooke Non-Executive Director
Piers had a career in Banking spanning 37 years holding senior
management positions in London, Paris, Hong Kong and New
York. He joined Focus as a director in 2000 and currently holds
directorships in a number of other Public and Private companies.
Martin Fiennes Non-Executive Director
Martin is an investment manager with Top Technology Ventures
Ltd, early stage investors in UK technology businesses, and acts as
a Non-Executive Director with a number of other UK enterprise
software companies.
Lin Johnstone Non-Executive Director 
Lin Johnstone has over 15 years experience in the software
industry.  In recent years she was CEO of Evolve Software Inc and
Industri Matematik International.  During her career she has held
vice president positions at E.piphany UK and Aspect
Communications.
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6 7 8 9 Focus Solutions Group plc Annual Report & Accounts 2004 9
Directors’ Statement on Corporate Governance
The Board of Directors is accountable to shareholders for the good corporate governance of the Group. The Directors support the
principles of good corporate governance contained within the 2003 Financial Reporting Council (FRC) Code. However, under the
rules of the Alternative Investment Market (“AIM”) the Company is not required to comply with the Code and the Board considers
that it is inappropriate, bearing in mind the size of the Group, for it to comply with all aspects of the Code’s requirements.
Nevertheless, this statement sets out how the principles of the Code are adhered to by the Board. 
The Board and its Committees
The composition of the Board is set out on Page 8. The Board comprises a non-executive Chairman, five executive directors and
three non-executive directors. The majority of non-executive directors are independent of management and free from any
business or other relationship, which could materially interfere with the exercise of their independent judgement. The senior
non-executive director is Piers Brooke.
The Board meets regularly to review not only the current state of the business but also to determine its future strategic direction.
The Board has a formal schedule of matters specifically reserved for its decision.
The Audit and Remuneration and Nomination Committees consist exclusively of non-executive directors. 
The Audit and Remuneration and Nomination Committee have formally delegated duties and responsibilities. 
The Audit Committee receives and reviews reports from management and the Company’s auditors relating to the annual and
interim accounts and the accounting and internal control systems in use throughout the Group. The Audit Committee have
unrestricted access to the Company’s auditors.
The Remuneration and Nomination Committee reviews the scale and structure of the executive directors’ remuneration and the
terms of their contracts. The remuneration and terms and conditions of appointment of the non-executive directors are set by
the Board. The Committee also administers the Share Option Schemes and is responsible for approval of senior appointments.
Internal control
The Board has considered the guidance published by the Institute of Chartered Accountants in England and Wales concerning
the internal control requirement of the Combined Code and has established an ongoing process for identifying, evaluating and
managing the significant risks faced by the Group.
The Board is responsible for the Group’s system of internal financial control, which is designed to provide reasonable, but not
absolute, assurance against material misstatement or loss. The Group’s system of internal control includes, but is not limited to:
 the Board, which now includes four non executive directors, has overall responsibility for the decision making in the Group;
 an annual budget is prepared in advance of the start of the financial year against which the Group’s actual performance is
monitored by the Directors;
 the Directors have put in place an organisational structure with clearly defined lines of responsibility and delegation of
authority;
 the Group’s management has a clear responsibility for identifying risks facing the business and for putting in place
procedures to mitigate and monitor those risks; and 
 there are clearly defined control policies and procedures for all transactions including appropriate authorisation levels. 10 Focus Solutions Group plc Annual Report & Accounts 2004
Directors’ Statement on Corporate Governance continued
The Directors have reviewed the effectiveness of the Group’s internal control systems for the year ended 31 March 2004.
Steps continue to be taken to embed internal control and risk management further into the operations of the business and to
deal with areas of improvement which come to management’s and the Board’s attention.
The Chairman’s Statement and Chief Executive’s Statement present a balanced and understandable assessment of the Company’s
position and prospects.
Going concern
After making enquiries, the Directors consider that the Group has adequate resources to continue in operational existence for the
foreseeable future. Consequently, they have continued to adopt the going concern basis in preparing the financial statements. Focus Solutions Group plc Annual Report & Accounts 2004 11
Directors’ Report
The Directors present their report and the audited financial statements for the year ended 31 March 2004. 
The Group financial statements consolidate the financial statements of Focus Solutions Group plc and its subsidiary undertakings
made up from 1 April 2003 to 31 March 2004.
Principal activity
The principal activity of the Group during the period was the provision of software and business solutions to the UK life and
pensions, insurance and financial services markets. Towards the end of the year, the Group also commenced the supply of
XFormation software via the Internet.
Review of business
A detailed review of activities and developments in the Group is contained in the Chairman’s Statement on pages 4 and 5 and
the Chief Executive’s Review on pages 6 and 7. 
Results and dividends
The loss on ordinary activities for the year after taxation was £282,000 (2003: £3,432,000). The Directors are not recommending the
payment of a dividend for the period to 31 March 2004 (2003: £nil).
Directors and their interests
The Directors who served during the period, and their beneficial interests in the share capital of the Company are shown in the
Remuneration and Nomination Committee’s Report on pages 13 to 16. 
Substantial shareholdings
On 31 May 2004 the Company had been notified of the following holdings of 3% or more of its issued share capital.
Number of shares %
John Streets 8,350,000 29.20
Hatt III LP 6,333,053 22.15
Liontrust 3,132,400 10.96
Rathbones 1,765,000 6.17
Nordea Invest Special Aktier 1,584,549 5.54
Close Investment Limited 1,579,470 5.52
ISIS Asset Management 1,115,000 3.90
No other person has reported an interest of more than 3% in the ordinary shares.
Employees
The Group is an equal opportunity employer and makes every effort to ensure disabled people are not discriminated against on
the grounds of their disabilities. In the event of staff becoming disabled, every effort is made to ensure that their employment
continues and that appropriate training is arranged. Employees are kept informed regarding the Group’s affairs and are consulted
on a regular basis through meetings, wherever feasible and appropriate.
Employees are encouraged to own shares in the Company and approximately 91% of employees are shareholders and/or hold
options in the Company’s share option schemes.
Research and development
Development costs relate to the onward development of the product range. All development costs are charged to the profit and
loss account as incurred. 12 Focus Solutions Group plc Annual Report & Accounts 2004
Directors’ Report continued
Charitable contributions
During the period under review, the Group made charitable contributions totalling £345 (2003: £1,000).
Creditor payment policy
The Company and its subsidiary undertakings agree appropriate terms and conditions for their business transactions with
suppliers. Payment is then made on these terms subject to the terms and conditions being met by the suppliers. The average
number of days credit taken on the outstanding balance at the year end is 102 (2003: 56 days). 
Financial instruments
The Group’s financial instruments comprise borrowings, cash and short-term deposit and various items, such as trade debtors and
trade creditors that arise directly from its operations. The main purpose of these financial instruments is to fund the Group’s
operations as well as to manage working capital, liquidity and invest surplus funds.
It is, and has been throughout the period under review, the Group’s policy not to enter into derivative transactions and no trading
in financial instruments has been undertaken. The Group faces few risks pertaining to financial instruments.
Interest rate risk
The Group continues to finance its operations from the original issue of new equity. Accordingly borrowings are insignificant.
Surplus cash balances are held on the money market in the short term at fixed rates of interest.
Liquidity risk
Whilst the Group’s operations are not currently cash generative, surplus cash from its new equity finance is invested so as to
achieve a market rate of return. These investments are held to ensure the Group remains sufficiently liquid to meet its
requirements.
Foreign currency risk
The Group has minimal exposure to foreign currency risks.
Re-appointment of Auditors
On 1 August 2003, Deloitte & Touche, the Company's auditors transferred their business to Deloitte & Touche LLP , a limited liability
partnership incorporated under the Limited Liability Partnerships Act 2000. The Company's consent has been given to treating
the appointment of Deloitte & Touche as extending to Deloitte & Touche LLP with effect from 1 August 2003 under the provisions
of section 26(5) of the Companies Act 1989. A resolution to re-appoint Deloitte & Touche LLP as the Company's auditor will be
proposed at the forthcoming Annual General Meeting.
This report was approved by the Board on 8 June 2004 and signed on its behalf by:
M J Clements
Secretary Focus Solutions Group plc Annual Report & Accounts 2004 13
Remuneration and Nomination Committee’s Report
The Remuneration and Nomination Committee (“the Committee”), comprising Alastair Taylor, Piers Brooke and Lin Johnstone with
Alastair Taylor as Chairman, meets as required during the year. Executive directors may also be invited to attend meetings but may
not vote and are not involved in any matter relating to themselves. 
Remuneration policy
The policy of the Committee is to ensure that the remuneration packages offered to the executive directors are competitive and
designed to attract, retain and motivate executive directors and senior executives of a high calibre. These packages are reviewed
regularly and independent advice is taken when appropriate. They are structured to include both short and longer term
incentives. None of the Committee has any personal financial interest (other than as shareholders), conflicts of interest or day-to-
day involvement in running the business. No director plays a part in deciding their own remuneration.
The remuneration of the non-executive directors is determined by the Board. The non-executive directors do not participate in
the bonus scheme, nor do they receive any other benefits.
There are five main elements of the remuneration package for executive directors:
 basic salary;
 bonuses;
 pensions;
 other benefits; and
 share option incentives
Basic salary
The basic salaries of the executive directors are determined after a review of the performance of the individual. It is the aim of the
Committee to reward directors competitively and commensurate with their responsibilities and experience.
Bonuses
The basis of bonus payments is at the discretion of the Committee and are based on financial performance targets. The bonuses
are paid annually in arrears.
Pensions
The Company contributes a pre-set percentage of pensionable earnings to defined contribution schemes for the current
executive directors.
Other benefits
Executive directors are provided with a company car or car allowance in line with market practice and private health care.
Directors and their interests
The directors who served during the period, and their beneficial interests in the share capital of the Company are shown below.
At the Annual General Meeting to be held on 22 July 2004, Mr J B Streets, Mr M A Loosmore and Mr M G Fiennes will retire and
offer themselves for re-election.
Share options
The Group operates the following share option schemes: 
– an EMI scheme
– an Inland Revenue Approved scheme
– an Unapproved scheme 14 Focus Solutions Group plc Annual Report & Accounts 2004
Remuneration and Nomination Committee’s Report continued
These schemes are administered and the grant of options supervised by the Committee. The price per ordinary share at which
options may be exercised under the Unapproved Scheme and the EMI Scheme will not be less than the middle market quotation
for the dealing day immediately preceding the date of grant. The price per ordinary share at which options may be granted under
the Approved Scheme will be not less than the market value as agreed with the Inland Revenue. 
The Committee have adopted a policy of phased grants of options, either yearly or half-yearly, with no individual receiving
options over shares in any one year with a value exceeding his or her annual salary. 
The Committee also resolved that it would, in future, set performance conditions designed to incentivise senior management in a
way, which is intended, if achieved, to enhance shareholder returns. After careful consideration, and taking into account the stage
the Company had reached in its development, the Committee decided to adopt performance conditions allowing exercise of
options upon the achievement of a target earnings per share figure within a minimum of three years, and a maximum of five,
from the date of grant of the option. The Committee has chosen this as the most appropriate measure in that it is both closely
aligned with shareholder interests and is a readily visible indicator of the Group’s underlying financial performance.
In the view of the Committee, its policy for the operation of the Company’s share option schemes forms part of a well-considered
remuneration policy to facilitate the motivation, retention and recruitment of executives. The Committee regularly reviews its
policy on share incentives to ensure that it is broadly in line with market practice and to maintain its continued effectiveness.
Service contracts
J B Streets, M A Thelwell, M A Loosmore, F Murray and M J Clements have service contracts with the Company, which are capable
of termination by the Company giving one year’s notice for J B Streets, and six months notice for M A Thelwell, M A Loosmore, 
F Murray and M J Clements.
A M Taylor, L F Johnstone, P L Brooke and M G Fiennes have letters of appointment with the Company, which cover a period of
one year and are capable of termination under certain circumstances. 
The remuneration of the directors was as follows:-
Waiver
of Salary Compensation
Salary Pension and Pension for Loss Other Total
& Fees Contributions Contributions of Office Benefits £’000
Year ended 31 March 2004
J B Streets 110 22 (7) – 14 139
M A Loosmore 108 9 (3) – 15 129
M A Thelwell 100 15 (4) – 11 122
F Murray 85 9 (3) – 10 101
S A Hele 17 2 – 50 3 72
A M Taylor 20–––– 20
P L Brooke 17–––– 17
M G Fiennes 17–––– 17
W R Hull 8 –––– 8
L F Johnstone 17–––– 17
M J Clements 70 7 (3) – 8 82
Total 569 64 (20) 50 61 724 Focus Solutions Group plc Annual Report & Accounts 2004 15
Remuneration and Nomination Committee’s Report continued
Waiver of
Salary and Compensation
Salary Pension Pension for Loss Other Total
& Fees Contributions Contributions of Office Benefits £’000
Year ended 31 March 2003
J B Streets 108 22 (26) – 14 118
M A Loosmore 98 8 – – 9 115
M A Thelwell 98 15 (19) – 11 105
F Murray 85 8 – – 7 100
S A Hele 68 7 – – 8 83
A M Taylor 14–––– 14
P L Brooke 17–––– 17
M G Fiennes 17–––– 17
W R Hull 17–––– 17
L F Johnstone 11–––– 11
R J M Jephcott 20–––– 20
Total 553 60 (45) – 49 617
Fees of £23,281 were paid during the year ended 31 March 2004 (2003: £68,000) for consultancy and advisory services to Robert
Hull & Co of which W R Hull is the proprietor.
Amounts of £nil were paid during the year ended 31 March 2004 (2003: £9,000) for property rental to Mr J B Streets.
The remuneration of M G Fiennes is paid to Top Technology Limited. 
Directors’ interests
According to the register of the Directors’ interests in the shares of the Company the following shares were held:
1 April 2003 31 March 2004
Number of Number of
Ordinary shares Ordinary shares
A M Taylor – 40,000
J B Streets 8,250,000 8,350,000
M J Clements – 100,680
M A Loosmore 556,000 556,000
M A Thelwell 558,564 578,972
M G Fiennes 70,128 73,634
P L Brooke 5,000 5,000
F Murray – 18,900
L F Johnstone – 50,400
Mr M J Clements was appointed a director of the Company on 12 June 2003. Mrs S A Hele and Mr W R Hull retired from the Board
on the 12 June 2003 and 25 September 2003 respectively. 16 Focus Solutions Group plc Annual Report & Accounts 2004
Remuneration and Nomination Committee’s Report continued
The following share options were held by directors:
At 1 April At 31 March Exercise 
2003 Granted 2004 Price Exercise
Director Scheme Number Number Number pence Period
M A Thelwell The Unapproved Scheme 166,000 – 166,000 14.586 15.03.2002 to 14.03.2009
M A Thelwell The Unapproved Scheme 190,000 – 190,000 20 20.01.2003 to 19.01.2010
M A Thelwell The EMI Scheme – 100,000 100,000 25 16.06.2006 to 15.06.2013
M A Loosmore The Unapproved Scheme 166,000 – 166,000 14.586 15.03.2002 to 14.03.2009
M A Loosmore The Unapproved Scheme 100,000 – 100,000 20 20.01.2003 to 19.01.2010
M A Loosmore The EMI Scheme – 25,000 25,000 25 16.06.2006 to 15.06.2013
F Murray The EMI Scheme 25,000 – 25,000 89 25.07.2004 to 24.07.2011
F Murray The EMI Scheme 50,000 – 50,000 89 25.07.2004 to 24.07.2011
F Murray The EMI Scheme 15,000 – 15,000 89 15.11.2004 to 14.11.2011
F Murray The EMI Scheme – 75,000 75,000 25 16.06.2006 to 15.06.2013
F Murray The EMI Scheme – 3,285 3,285 35 14.01.2007 to 13.01.2014
F Murray The Approved Scheme – 85,714 85,714 35 14.01.2007 to 13.01.2014
M J Clements The EMI Scheme – 50,000 50,000 25 16.06.2006 to 15.06.2013
M J Clements The EMI Scheme – 50,000 50,000 35 14.01.2007 to 13.01.2014
Performance conditions are attached to the EMI options granted to M A Thelwell whereby EPS is required to reach 12p within 
5 years of grant.
Performance conditions are attached to the EMI options granted to M A Loosmore whereby EPS is required to reach 12p within 
5 years of grant.
Performance conditions are attached to the EMI options granted to F Murray whereby EPS is required to reach 5p, 10p, 10p, 12p
and 12p respectively, for the tranches of 25,000, 50,000, 15,000, 75,000 and 3,285 options within 5 years of grant and in addition in
respect of the tranche of 50,000 options only 25,000 will be exercisable at the earliest after 3 years from date of grant the balance
being exercisable at the earliest of 4 years from the date of grant.
Performance conditions are attached to the EMI options granted to M J Clements whereby EPS is required to reach 12p, for each
tranche of 50,000 options within 5 years of grant. 
During the year from 1 April 2003 to 31 March 2004 the mid-market price of the ordinary shares had the range of 12p, the price at
1 April 2003, to 56p on 6 March 2004. The mid-market price at the year-end was 56p.
Alastair M Taylor Focus Solutions Group plc Annual Report & Accounts 2004 17
Directors’ Responsibilities in the Preparation of Financial Statements
UK company law requires the Directors to prepare financial statements for each financial year, which give a true and fair view of
the state of affairs of the Company and the Group and of the profit and loss of the Group for that period. In preparing those
financial statements, the Directors are required to:
 select suitable accounting policies and then apply them consistently;
 make judgements and estimates that are reasonable and prudent;
 state whether applicable accounting standards have been followed, subject to any material departures disclosed and
explained in the financial statements; and
 prepare financial accounts on the going concern basis unless it is inappropriate to assume the Group will continue to be in
business.
The Directors are responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the
financial position of the Company and to enable them to ensure the financial statements comply with the requirements of the
Companies Act 1985. They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for
the prevention and detection of fraud and other irregularities. 18 Focus Solutions Group plc Annual Report & Accounts 2004
Independent Auditors’ Report to the Members of Focus Solutions Group plc
We have audited the financial statements of Focus Solutions Group Plc for the year ended 31 March 2004 which comprise the
profit and loss account, the balance sheets, the cash flow statement and the related notes 1 to 20, together with the
reconciliation of net cashflow to movement in net funds. These financial statements have been prepared under the accounting
policies set out therein. 
This report is made solely to the Company’s members, as a body, in accordance with section 235 of the Companies Act 1985. Our
audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to
them in an auditors’ report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for
the opinions we have formed.
Respective responsibilities of directors and auditors
As described in the statement of directors’ responsibilities, the Company’s directors are responsible for the preparation of the
financial statements in accordance with applicable United Kingdom law and accounting standards. They are also responsible for
the preparation of the other information contained in the annual report. Our responsibility is to audit the financial statements in
accordance with relevant United Kingdom legal and regulatory requirements and auditing standards.
We report to you our opinion as to whether the financial statements give a true and fair view and whether the financial
statements have been properly prepared in accordance with the Companies Act 1985. We also report to you if, in our opinion, the
Directors’ report is not consistent with the financial statements, if the Company has not kept proper accounting records, if we
have not received all the information and explanations we require for our audit, or if information specified by law regarding
directors’ remuneration and transactions with the Company and other members of the Group is not disclosed.
We read the Directors’ report and the other information contained in the annual report for the above year as described in the
contents section and consider the implications for our report if we become aware of any apparent misstatements or material
inconsistencies with the financial statements.
Basis of audit opinion
We conducted our audit in accordance with United Kingdom auditing standards issued by the Auditing Practices Board. An audit
includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial. It also includes an
assessment of the significant estimates and judgements made by the Directors in the preparation of the financial statements and
of whether the accounting policies are appropriate to the circumstances of the Company and the Group, consistently applied
and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in
order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion, we also evaluated the overall
adequacy of the presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state of affairs of the Company and the Group as at
31 March 2004 and of the loss of the Group for the year then ended and have been properly prepared in accordance with the
Companies Act 1985.
Deloitte & Touche LLP 
Chartered Accountants and Registered Auditors
Birmingham
8 June 2004 Focus Solutions Group plc Annual Report & Accounts 2004 19
Consolidated Profit & Loss Account
for the year ended 31 March 2004
Y ear ended Year ended
31 March 31 March
2004 2003
Continuing Continuing Discontinued
Operations Operations Operations Total
Notes £’000 £’000 £’000 £’000
Turnover 2 5,388 6,583 – 6,583
Operating loss before re-organisation costs
and amortisation of goodwill (470) (1,358) (1,119) (2,477)
Re-organisation costs 6 (119) (64) (129) (193)
Amortisation of goodwill – – (343) (343)
Operating loss 3 (589) (1,422) (1,591) (3,013)
Loss on disposal of US operations 6 167 – (897) (897)
Loss on ordinary activities before interest (422) (1,422) (2,488) (3,910)
Net interest receivable 7 40 89 (12) 77
Loss on ordinary activities before taxation (382) (1,333) (2,500) (3,833)
Taxation 8 100 401 – 401
Loss on ordinary activities after taxation and
retained loss for the year 15 (282) (932) (2,500) (3,432)
Loss per ordinary share 9 (1.0p) (13.4p)
No separate statement of total recognised gains and losses has been presented as all such gains and losses have been dealt with in the profit
and loss account. 20 Focus Solutions Group plc Annual Report & Accounts 2004
Group Balance Sheet
31 March 2004
2004 2003
Notes £’000 £’000
Fixed assets
Tangible assets 10 171 224
Current assets
Debtors 12 1,845 1,704
Investments - money market deposits 250 656
Cash at bank and in hand 1,234 1,039
3,329 3,399
Creditors: Amounts falling due within one year 13 1,331 1,848
Net current assets 1,998 1,551
Total assets less current liabilities 2,169 1,775
Net assets 2,169 1,775
Capital and reserves
Called up share capital 14 & 15 2,851 2,567
Share premium 15 9,819 9,427
Merger reserve 15 220 220
Profit and loss account 15 (10,721) (10,439)
Shareholders' funds – equity interests 15 2,169 1,775
Approved by the Board on 8 June 2004
J B Streets M A Thelwell
Director Director Focus Solutions Group plc Annual Report & Accounts 2004 21
Company Balance Sheet
31 March 2004
2004 2003
Notes £’000 £’000
Fixed assets
Investments 11 1,960 1,960
Current assets
Debtors – due within one year 12 2,715 1,544
Debtors – due after more than one year 12 5,450 6,100
Investments – money market deposits 250 656
Cash at bank and in hand 1,212 725
9,627 9,025
Creditors: Amounts falling due within one year 13 278 352
Net current assets 9,349 8,673
Total assets less current liabilities 11,309 10,633
Net assets 11,309 10,633
Capital and reserves
Called up share capital 14 & 15 2,851 2,567
Share premium 15 9,819 9,427
Profit and loss account 15 (1,361) (1,361)
Shareholders' funds – equity interests 15 11,309 10,633
Approved by the Board on 8 June 2004
J B Streets M A Thelwell
Director Director 22 Focus Solutions Group plc Annual Report & Accounts 2004
Consolidated Cash Flow Statement
for the year ended 31 March 2004
Y ear ended Year ended
31 March 31 March
2004 2003
Notes £’000 £’000
Net cash outflow from operating activities 16a (927) (2,375) 
Returns on investments and servicing of finance 16b 40 73
Taxation 16b 56 345
Capital expenditure and financial investment 16b (56) (159)
Acquisitions and disposals 16b – (802)
Cash outflow before management of liquid resources and financing (887) (2,918)
Management of liquid resources 16b 406 3,174
Financing 16b 676 3
Increase in cash in the year 195 259
Reconciliation of net cashflow to movement in net funds
Y ear ended Year ended
31 March 31 March
2004 2003
Notes £’000 £’000
Increase in cash in the period 195 259
Change in net funds resulting from financing – 3
Decrease in liquid resources (406) (3,174)
Movement in net funds in the year (211) (2,912)
Net funds at start of year 1,695 4,607
Net funds at end of year 16c 1,484 1,695 Focus Solutions Group plc Annual Report & Accounts 2004 23
Notes to the Financial Statements
for the year ended 31 March 2004
1 Accounting policies
The financial statements have been prepared in accordance with statements of standard accounting practice issued by UK
accounting bodies.
The following accounting policies have been applied consistently with those set out in the 31 March 2003 Group Accounts,
in dealing with items which are considered material in relation to the financial statements.
Basis of accounting
The financial statements have been prepared under the historical cost convention.
Basis of consolidation
The Group financial statements consolidate the financial statements of Focus Solutions Group plc and its subsidiary undertakings
made up to 31 March 2004.
The Company has taken advantage of the exemption in Section 230 of the Companies Act 1985 and has not published its own
profit and loss account.
Goodwill & amortisation
Goodwill arising on acquisition is capitalised in the balance sheet in the month in which it arises and amortised over its estimated
useful life of 10 years. It is reviewed for impairment at the end of the first full year of financial year following acquisition and in other
periods if events or changes in circumstances indicate that the carrying value may not be recoverable.
Tangible fixed assets
Fixed assets are stated at historical cost less accumulated depreciation.
Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost evenly over its expected useful life, as
follows:
Software Between 2 and 4 years
Fixtures and fittings Between 3 and 4 years
Motor vehicles over 3 years
Computer equipment Between 2 and 4 years
During the year, the Group reviewed the appropriateness of the expected useful lives for all its assets. As a result of this review,
the expected useful lives of all assets not already fully written off were revised to four years.
Deferred taxation
Deferred taxation is provided in full on timing differences that result in an obligation at the balance sheet date to pay more tax,
or a right to pay less tax at a future date at rates expected to apply when they crystallise based on current tax rates and law. Timing
differences arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in
which they are included in financial statements. Deferred tax assets are recognised to the extent that it is regarded as more likely
than not that they will be recovered. Deferred tax assets and liabilities are not discounted.
Leased assets and obligations
Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase
contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated
useful lives or the lease term, whichever is the shorter. 24 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
1 Accounting policies (continued)
The interest element of these obligations is charged to the profit and loss account over the relevant period. The capital element of
the future payments is treated as a liability.
Rentals paid under operating leases are charged to the profit and loss account on a straight-line basis over the term of the lease.
Foreign currency
Foreign currency transactions are converted to sterling during the year at the rates ruling at the time of the transaction. Any
amounts outstanding at the year-end are translated at the rate of exchange ruling at the balance sheet date and the gains and
losses on translation are included in the profit and loss account.
Pension contributions
The Group makes contributions to defined contribution pension schemes that have been set up for and independently
administered on behalf of certain directors and employees. Contributions payable for the period are charged in the profit and loss
account.
Research and development expenditure
Research and development expenditure is written off in the year during which it is incurred.
Turnover
Turnover represents the invoiced value, net of Value Added Tax, of goods sold and services provided to customers during the period. 
Revenue recognition
Revenue from the sale of software licences is recognised in full where there is persuasive evidence that an agreement exists, when
delivery has occurred, when the fee if fixed, the customer has obtained some benefit from its use and when collectability is
considered probable. Turnover represents the invoiced value, net of Value Added Tax, of goods sold and services.
Revenue from implementation services is recognised as services are delivered to the customer and contractual obligations have
been met.
Revenue from maintenance services is recognised on a straight-line basis over the maintenance contract. Revenue not recognised in
the profit and loss account is classified as deferred income in the balance sheet.
Investments
In the Company’s balance sheet, investments in subsidiary undertakings are stated at cost less any provision. Where the
consideration for the acquisition of a subsidiary undertaking includes shares in the Company to which the provisions of section 131
of the Companies Act 1985 apply, cost represents the nominal value of shares issued together with the fair value of any additional
consideration given and acquisition costs. Focus Solutions Group plc Annual Report & Accounts 2004 25
Notes to the Financial Statements continued
2 Turnover and segmental analysis
The geographical analysis of turnover by destination is:
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
United Kingdom 5,367 6,583
North America 21 –
5,388 6,583
The Group’s turnover and loss on ordinary activities before taxation were all derived from its principal activity. All turnover originates
in the United Kingdom and all assets are held in the United Kingdom.
3 Operating loss before interest
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000 £’000
Continuing Continuing Discontinued
Operations Operations Operations Total
Turnover 5,388 6,583 – 6,583
Staff costs (3,900) (5,600) (608) (6,208)
Depreciation (109) (300) (20) (320)
Other operating charges (1,968) (2,105) (963) (3,068)
Operating loss (589) (1,422) (1,591) (3,013)
Operating loss is stated after charging/ (crediting):
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Depreciation and amounts written off tangible fixed assets:
Charge for the year:
Owned assets 109 318
Leased assets – 2
Profit on disposal of fixed assets – (3)
Amortisation of goodwill – 343
Re-organisation costs 119 193
Operating lease rentals:
Other – Rent paid on land & buildings 231 272
– Other assets (including motor vehicles) 110 140
Research & development expenditure 911 1,044
Auditors' remuneration:
Audit services – Group 20 20
Other services 8 16
The cost of audit services provided to the Company were £11,850 (2003: £10,000) and are included within the audit services charged
to the Group. 26 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
4 Directors emoluments
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Emoluments 724 617
Company contributions to money purchase pension schemes 51 60
No. No.
Members of money purchase pension schemes 6 5
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
The amounts paid in respect of the highest paid director are as follows:
Emoluments 139 118
Company contributions to money purchase pension schemes 15 22
5Staff costs
Y ear ended Year ended
31 March 31 March
2004 2003
No. No.
The average monthly number of persons (including directors) employed
by the Group during the year was:
Office and management 16 23
Sales and development 73 93
89 116
£’000 £’000
Staff costs for the above persons:
Wages and salaries 3,225 5,403
Social security costs 420 555
Other pension costs 209 289
National Insurance on share options 46 (39)
3,900 6,208
Information in respect of directors’emoluments, share options and pensions is given in the Remuneration and Nomination
Committee’s Report on page 13. The audited information in this report forms part of the financial statements. Focus Solutions Group plc Annual Report & Accounts 2004 27
Notes to the Financial Statements continued
6 Re-organisation costs
The re-organisation costs associated with continuing operations relate to redundancy payments made to certain employees within
the UK business. The re-organisation costs associated with the discontinued operations in the prior year relate to costs associated
with the closure of the Boston office. A provision against the loss on disposal of the US operations set up last year, was released in
the year following a renegotiation of the terms of the disposal.
7 Net interest receivable
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Bank interest receivable 41 90
Interest payable (1) (13)
Net interest receivable 40 77
8 Taxation 
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
a. Analysis of tax charge on ordinary activities
Current Tax:
UK corporation tax at 30% (2002: 30%) based on the loss for the period – –
Adjustment in respect of prior years 100 401
Total tax credit 100 401
b. Factors affecting tax charge for the current period
Loss on ordinary activities before tax (382) (3,833)
Tax at 30% thereon: 115 1,150
Effects of:
Expenses not deductible for tax purposes (11) (19)
Capital allowances in excess of depreciation 23 (88)
Utilisation/ (creation) of tax losses (128) (425)
Movement in short term timing differences – –
Marginal Relief 1 –
Non deductible expenses on group re-organisation – (618)
Prior period adjustment 100 401
Current tax charge 100 401 28 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
8 Taxation (continued)
c. Factors that may affect the future tax charge
A deferred tax asset has not been recognised in respect of timing differences relating to revenue losses as there is insufficient
evidence that the asset will be recovered. The amount of the asset not recognised is £1,824,862 (2003: £1,765,000). The asset would 
be recovered if eligible taxable profits arise in the future.
9 Loss per ordinary share
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Earnings attributable to ordinary shareholders
Loss for the financial year (282) (3,432)
Weighted average number of ordinary shares issued during the year (000’s) 27,504 25,628
Basic loss per share (1.0p) (13.4p)
FRS 14 requires presentation of diluted EPS when a Company could be called upon to issue shares that would decrease net profit or
increase net loss per share. For a loss making company with outstanding share options, net loss per share would only be increased
by the exercise of out-of-the-money options. Since it seems inappropriate to assume that option holders would act irrationally, and
there are no other diluting future share issues, diluted EPS equals basic EPS and therefore has not been presented.
10 Tangible fixed assets
The Group Fixtures & Motor Computer
Software fittings vehicles equipment Total
£’000 £’000 £’000 £’000 £’000
Cost
1 April 2003 309 298 12 508 1,127
Additions 35 – – 21 56
Disposals – (1) – – (1)
At 31 March 2004 344 297 12 529 1,182
Depreciation
1 April 2003 229 246 12 416 903
Charge for the period 37 30 – 42 109
Disposals – (1) – – (1)
At 31 March 2004 266 27512 45 8 1,012
Net book value
31 March 2004 78 22 – 71 171
31 March 2003 80 52 – 92 224
The Company had no tangible fixed assets at 31 March 2004 (31 March 2003: £nil). Focus Solutions Group plc Annual Report & Accounts 2004 29
Notes to the Financial Statements continued
11 Investments
The Group
The Group owns 49% of Focus Solutions Holdings Inc, a holding company registered in Delaware USA which holds 100% of Focus
Solutions Inc, a company registered in Pennsylvania, USA formerly engaged in the provision of business solutions to the life and
pensions and long term care industry. The assets and liabilities of Focus Solutions Inc were sold during the year. It is now dormant.
The investment in Focus Solutions Holdings Inc and Focus Solutions Inc are shown as investments as the Group has no influence
over the control of the businesses. 
The shares issued as part of the initial investment consideration have been recorded at nominal value in the Company’s accounts
due to the application of Section 133 of the Companies Act 1985.
Shares Shares
The Company in Group in Group
undertakings undertakings
31 March 2004 31 March 2003
£’000 £’000
Cost and net book value 1,960 1,960
The Company directly holds more than 20% of the share capital of the following companies which are included in the consolidated
results of the Group:
Name Country of Proportion Nature of
incorporation held business
Focus Business Solutions Limited England 100% Provision of business solutions in life and pensions,
insurance and financial services markets.
Focus Software Limited England 100% Development and distribution of
XFormation software
Focus Holdings Limited England 100% Holding company 30 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
12 Debtors
The Group The Company
31 March 31 March
2004 2003 2004 2003
£’000 £’000 £’000 £’000
Trade debtors 1,379 1,416 – –
Amounts due from Group undertakings – – 7,881 7,497
Other debtors 69 54 69 40
Corporation tax recoverable 100 56 – –
Prepayments and accrued income 297 178 215 107
1,845 1,704 8,165 7,644
Amounts due from Group undertakings includes £5,450,000 (2003: £6,100,000) that is due in more than one year.
13 Creditors: Amounts falling due within one year
The Group The Company
31 March 31 March
2004 2003 2004 2003
£’000 £’000 £’000 £’000
Trade creditors 310 338 175 138
Other taxation and social security costs 530 526 38 27
Amount due to Group undertakings – – 1 –
Accruals and deferred income 491 984 64 187
1,331 1,848 278 352 Focus Solutions Group plc Annual Report & Accounts 2004 31
Notes to the Financial Statements continued
14 Share capital
31 March 31 March
2004 2003
£’000 £’000
Authorised
40,000,000 ordinary shares of 10p each 4,000 4,000
Share capital as at 31 March 2003 2,567 2,508
Issued for acquisition of Focus Solutions Inc – 55
Issued on exercise of options 28 4
Other issue of shares 256 –
Allotted, issued and fully paid as at 31 March 2004
28,512,358 ordinary shares of 10p each 2,851 2,567
During the year, the Company issued 274,000 ordinary 10 pence shares in respect of share options exercised for a net consideration
of £48,087, including share premium of £20,687.
On 24 July 2003, the Company issued 1,283,730 ordinary 10 pence shares at 24.5 pence, for a net consideration of £314,518,
including share premium of £186,145.
On 25 July 2003, the Company issued 1,280,000 ordinary 10 pence shares at 24.5 pence, for a net consideration of £313,600,
including share premium of £185,600.
At 31 March 2004 the Company had the following outstanding share options.
Exercise price 
Number (pence) Notes Scheme Exercise period
342,000 14.586 The Unapproved Scheme 15.03.2002 – 14.03.2009
620,000 20.00 The Unapproved Scheme 20.01.2003 – 19.01.2010
173,500 89.00 A The Approved Scheme 25.07.2004 – 24.07.2011
213,500 89.00 B The EMI Scheme 25.07.2004 – 24.07.2011
18,200 89.00 The Approved Scheme 14.11.2004 – 13.11.2011
87,500 89.00 C The EMI Scheme 14.11.2004 – 13.11.2011
30,000 101.00 D The EMI Scheme 17.12.2004 – 16.12.2011
32,800 48.50 The Approved Scheme 02.05.2005 – 01.05.2012
62,000 48.50 E The EMI Scheme 02.05.2005 – 01.05.2012
137,250 25.00 The Approved Scheme 16.06.2006 – 15.06.2013
353,000 25.00 E The EMI Scheme 16.06.2006 – 15.06.2013
90,092 35.00 The Approved Scheme 06.01.2007 – 05.01.2014
40,219 35.00 E The EMI Scheme 06.01.2007 – 05.01.2014
85,714 35.00 The Approved Scheme 14.01.2007 – 13.01.2014
53,285 35.00 E The EMI Scheme 14.01.2007 – 13.01.2014
Since the year end 6,700 options have lapsed. 32 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
14 Share capital (continued)
Notes
The following options have performance conditions requiring Earnings Per Share (EPS) to reach the amount stated within 5 years
of grant:
Note No of options EPS (pence) Additional Performance Conditions
A 70,000 10 50% may be exercisable 3 years from the date of grant with the
remainder exercisable 4 years from the date of grant.
B 25,000 5
98,500 10 50% may be exercisable 3 years from the date of grant with the
remainder exercisable 4 years from the date of grant.
C 87,500 10
D 30,000 10
E 508,504 12
15Share capital, reserves and reconciliation of movement in shareholders’funds
Share Share Merger Profit and
capital premium reserve loss account Total
£’000 £’000 £’000 £’000 £’000
The Group
At 1 April 2003 2,567 9,427 220 (10,439) 1,775
Share capital issued 284 392 – – 676
Loss for the year (282) (282)
At 31 March 2004 2,851 9,819 220 (10,721) 2,169
The Company
At 1 April 2003 2,567 9,427 – (1,361) 10,633
Share capital issued 284 392 – – 676
Loss for the year ––
At 31 March 2004 2,851 9,819 – (1,361) 11,309
As permitted by Section 230 of the Companies Act 1985, the profit and loss account of the parent company is not presented as part
of these accounts. The parent company's loss for the financial year amounted to £44,715 (2003: £1,461,000). Focus Solutions Group plc Annual Report & Accounts 2004 33
Notes to the Financial Statements continued
16 Cash flow statement
a. Reconciliation of operating loss to operating cash flows
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Operating loss (589) (3,013)
Depreciation 109 320
Profit on sale of tangible fixed assets – (3)
Amortisation of goodwill – 343
Increase in debtors (142) (206)
(Decrease) /increase in creditors (305) 184
Net cash outflow from operating activities (927) (2,375)
b. Analysis of cash flows for headings netted in the cash flow
Y ear ended Year ended
31 March 31 March
2004 2003
£’000 £’000
Returns on investments and servicing of finance
Interest received 41 86
Interest paid (1) (13)
Net cash inflow 40 73
Taxation 
Corporation Tax credit received 56 345
Net cash inflow 56 345
Capital expenditure and financial investment
Purchase of tangible fixed assets (56) (163)
Sale of tangible fixed assets – 4
Net cash outflow (56) (159)
Acquisitions and disposals
Purchase of subsidiary undertaking – (802)
Net cash outflow – (802)
Management of liquid resources
Decrease in cash on money market deposit 406 3,174
Net cash inflow 406 3,174
Financing
Issue of ordinary share capital 676 6
Capital element of finance lease rentals – (3)
Net cash inflow/(outflow) from financing 676 (3) 34 Focus Solutions Group plc Annual Report & Accounts 2004
Notes to the Financial Statements continued
16 Cash flow statement (continued)
c. Analysis of net funds
1 April Cash 31 March 
2003 Movement 2004
£’000 £’000 £’000
Cash at bank and in hand 1,039 195 1,234
Money market deposits 656 (406) 250
Total 1,695 (211) 1,484
17 Commitments under operating leases
At 31 March 2004 the Group had annual commitments under non-cancellable operating leases as follows:
31 March 31 March
2004 2003
£’000 £’000
Land and buildings:
expiring between 2 and 5 years 231 231
Other:
expiring within one year 47 61
expiring between 2 and 5 years 39 52
317 344
18 Pension commitments
The Group has defined contribution pension schemes for certain directors and employees. The assets of the schemes are held
separately from those of the Group in independently administered funds. Total contributions in the statutory period to 31 March
2004, amounted to £209,499 (2003: £289,000). As at 31 March 2004, contributions amounting to £15,717 (2003: £10,890) had been
prepaid. Focus Solutions Group plc Annual Report & Accounts 2004 35
Notes to the Financial Statements continued
19 Related party transactions
The Group received consultancy and advisory services on an arm’s length basis from Robert Hull & Co. Mr W R Hull, a former
director of the Company, is the proprietor of Robert Hull & Co. Purchases from Robert Hull & Co for the Group for the year ended
31 March 2004 were £23,281 (2003: £68,000), of which £23,281 (2003: £68,000) related to the Company.
Amounts due to Robert Hull & Co are disclosed below:
Group Company
31 March 31 March 31 March 31 March
2004 2003 2004 2003
£’000 £’000 £’000 £’000
Amount due to Robert Hull & Co. – 8 – 8
The Group received the benefit of property rental on an arm’s length basis from Mr J B Streets, the Chief Executive of the Comp any.
Purchases from Mr J B Streets for the Group for the year ended 31 March 2004 were £nil (2003: £9,000), of which £nil (2003: £9,000)
related to the Company.
Neither the Group or the Company owed any amounts to Mr J B Streets in respect of property rental at 31 March 2004.
20 Financial instruments
The disclosures required by FRS 13 in relation to the nature of any financial instruments used during the year to mitigate interest
rate, liquidity and foreign currency risks are shown in the Directors Report under the heading “Financial Instruments” . 
Short-term debtors and creditors
Short-term debtors and creditors have been excluded from the following disclosures (except those relating to borrowings and
foreign exchange).
At 31 March 2004 £250,000 (2003: £656,000) surplus cash was invested in money market deposits.
Interest rate risk of financial assets
All financial assets earn interest at floating rates based on LIBOR. Total financial assets are £1,483,870 of which £nil was held in dollars
(2003: £1,695,000, £364 held in dollars).
Undrawn facilities
As at 31 March 2004, the Group had a £350,000 undrawn overdraft facility. The facility is renewable annually and incurs interest at a
rate of 3% above HSBC’s base rate.
Fair value of financial assets and liabilities
The book value of financial instruments held or issued to finance the Group’s operations approximate to the fair value of those
instruments in the current or prior year, because of their short maturities.
Foreign exchange 
In the year ended 31st March 2004, a profit as a result of currency movements of £3,138 (2003: £17,000 loss) was made. Of this
amount £486 profit (2003: £1,000 loss) related to the Dollar bank account and £2,652 profit (2003: £16,000 loss) related to the sales of
goods and services. 36 Focus Solutions Group plc Annual Report & Accounts 2004
Advisors and Shareholder Information
Company Number
3911357 (England and Wales)
Registered Office
Cranford House
Kenilworth Road
Leamington Spa
Warwickshire CV32 6RQ
Nominated Advisor and Nominated Broker
Evolution Beeson Gregory plc
100 Wood Street
London EC2V 7AN
Solicitors
Hammonds
Rutland House
148 Edmund House
Birmingham B3 2JR
Wragge & Co LLP
55 Colmore Row
Birmingham
B3 2AS
Financial Calendar
Annual General Meeting 22 July 2004
Announcement of Interim Results 2004/5 November 2004
Announcement of Results 2004/5 June 2005
Auditors
Deloitte & Touche LLP
Birmingham
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Principal Bankers
Barclays Bank plc
Birmingham Corporate Banking Centre
PO Box 5960
15 Colmore Row
Birmingham B3 2EP
HSBC plc
PO Box 68 
130 New Street
Birmingham B2 4JU
Anglo Irish Bank Corporation plc
10 Old Jewry
London EC2R 8DN Focus Solutions Group plc Annual Report & Accounts 2004 37
Group Balance Sheet
31 March 2003 38 Focus Solutions Group plc Annual Report & Accounts 2004
Advisors and Shareholder Information
Company Number
3911357 (England and Wales)
Registered Office
Cranford House
Kenilworth Road
Leamington Spa
Warwickshire CV32 6RQ
Nominated Advisor and Nominated Broker
Evolution Beeson Gregory plc
100 Wood Street
London EC2V 7AN
Solicitors
Hammonds
Rutland House
148 Edmund House
Birmingham B3 2JR
Wragge & Co LLP
55 Colmore Row
Birmingham
B3 2AS
Financial Calendar
Annual General Meeting 22 July 2004
Announcement of Interim Results 2004/5 November 2004
Announcement of Results 2004/5 June 2005
Auditors
Deloitte & Touche LLP
Birmingham
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Principal Bankers
Barclays Bank plc
Birmingham Corporate Banking Centre
PO Box 5960
15 Colmore Row
Birmingham B3 2EP
HSBC plc
PO Box 68 
130 New Street
Birmingham B2 4JU
Anglo Irish Bank Corporation plc
10 Old Jewry
London EC2R 8DN Focus Solutions Group plc
Cranford House
Kenilworth Road
Leamington Spa
Warwickshire CV32 6RQ
Tel: +44 (0) 1926 468300
Fax: +44 (0) 1926 468400
www.focus-solutions.co.uk