View post tag: Armidale Australia, Serco Change Terms of Armidale Deal Back to overview,Home naval-today Australia, Serco Change Terms of Armidale Deal View post tag: Australia Australian Government and Serco Group have reached an agreement to amend the terms of the company’s contract to provide in-service support to the Navy’s fleet of Armidale Class Patrol Boats (ACPB). The company has negotiated to shorten the onerous contract which previously ran to 2022. According to the company’s statement the contract will now end in 2017. Under the terms of the Settlement and Amendment Deed, both parties have agreed to a mutual release of claims they may have had against each other prior to the point of contract amendment.Serco will provide maintenance and remediation work on an agreed cost recovery basis, but under improved standards, as the agreement states.The ACPB contract was subject to an Onerous Contract Provision (OCP) which had Serco pay USD 206,1 million at the end of 2014, reflecting anticipated future losses through to 2022, together with a further charge of USD 100 million relating principally to the impairment of receivables.Although a detailed assessment of Serco’s contracts subject to OCPs will be carried out at the year end, the company expects the ACPB contract amendment will result in a significant decrease in the overall level of the Group’s provisions against future contract losses.Rupert Soames, Group Chief Executive Officer, said:Today’s amendments represent an equitable solution for both parties. We remain absolutely focused on delivering the highest standard of operational performance on this challenging contract and continuing to support the Australian Defence Force as we have for nearly twenty years.The provisions against the ACPB contract represented approximately 30 percent of the Group’s OCPs charged at the end of 2014 and ACPB was the single largest OCP. The Group utilised USD 24,2 million of the ACPB provision in the first half of 2015.Image: Australian Navy November 11, 2015 View post tag: deal View post tag: Serco Share this article Authorities
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