Accounting change hits Brewin profit

INDEPENDENT stockbroker Brewin Dolphin yesterday said trading in the final quarter would be at the top end of expectations but that 2008 profits had been hit by a change in its accounting practices.<br /><br />It confirmed that, after discussions with the Financial Reporting Review Panel, it had changed its accounting policy.<br /><br />The move follows criticism from analysts at Numis, who said that Brewin was overstating profits by booking incentive payments to new joiners as &ldquo;goodwill&rdquo; instead of an &ldquo;intangible&rdquo;. This means it did not amortise or expense the one-off costs.<br /><br />Having changed this practice, pre-tax profit for 2008 has been cut from &pound;25.08m to &pound;22.02m, and net assets are revised down to &pound;119.9m to &pound;125.2m. The firm said it had &pound;17bn of funds under management.<br /><br />The firm confirmed that it spent &pound;24.3m on new client relationships in 2008, and that funds under management acquired in relation to these amounted to &pound;2.2bn as at 28 August.<br /><br /><strong>Numis boosted by market recovery</strong><br />Investment banking and broking group Numis said yesterday that its combined commission and trading revenues reached record levels in the first half, as markets picked up and liquidity improved.<br /><br />The broker said that, after a challenging start to the year, its core business performance strengthened as market conditions improved in the six months to 30 September.<br /><br />Numis, which said it had grown its market share in the period, said it had benefited from the increased level of capital raising activity as clients seek to shore up their balance sheets.