Annual Financial Report

7 April 2015

                                  Capita plc                                   

                                (the "Company")                                

Annual Financial Report

In compliance with Disclosure and Transparency Rule 4.1, the Company announces
the publication of its Annual Financial Report for the year ended 31 December
2014. Pursuant to Listing Rule 9.6.1, a copy of this document has been
submitted to the National Storage Mechanism and will shortly be available for
inspection at http://www.morningstar.co.uk/uk/NSM. The document is also
available on the Company's website: www.capita.co.uk.

Additional Information

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 26 February 2015. That information, together with the
information set out below, which is extracted from the Annual Report and
Accounts 2014, 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 2014. Page and note references
below refer to the corresponding pages and/or notes in the Annual Report and
Accounts 2014.

Principal risks and uncertainties

Risk management

Controlled risk taking is fundamental to the organisation's success, ensuring
that risks and rewards are balanced in the pursuit of sustainable, profitable
growth. Capita is not risk averse, it looks to actively manage risks which it
has scrutinised and has an appetite for within our underlying risk and
tolerance framework.

We believe that conducting our business with integrity, applying a high level
of skill, care and diligence to what we do, services the interests of all our
stakeholders. This allows us to grow in a controlled manner, and achieve our
business goals.

The risks Capita faces evolve over time as a result of both the changing size
and complexity of our business and its services but also through changes in the
external legal, economic and regulatory environment. In 2014, we have seen the
following developments in the wider risk environment:

  * increased understanding of the extent of `cyber' threats facing UK plc
    including the activity of hacktivists and those seeking fraudulent access
    to funds, data and information
   
  * increased European regulation in areas such as data protection and asset
    management
   
  * economic pressures raising litigation risk around asset performance
   
  * UK regulatory developments around `conduct' requiring greater focus on end
    customer outcomes in financial services and utility industries
   
  * increased focus on environmental risks through carbon pricing and energy.
   
Our risk management activities seek to protect the business from unnecessary
risk exposure, whilst still allowing divisional and business management to
operate with sufficient flexibility to react to market needs. It also helps us
demonstrate to clients, end customers and regulators how we take our
responsibilities seriously.

As Capita's business model devolves certain authority and responsibility to
business management at all levels, risk management is primarily the
responsibility of those who are in the best position to understand and act
effectively. They apply risk management in line with the Group-wide Risk Policy
set to reflect the risk appetite set by the Board and within an industry
standard `three lines of defence' model.

Principal risk categories

We operate a total of 22 risk categories which are kept under regular review.
Those deemed to have significant potential impact or exposure, as identified
through the Group's Risk Management Framework, are detailed below:

Key risk       Potential risks and   Mitigating activities  2014 developments   
categories     impacts               include                                    
                                                                                
Business         * Changes to the      * Focus on widening    * Successful entry
environment        political,            scope of existing      to new markets  
                   commercial or         contracts              and sectors for 
                   market landscape                             Capita including
                   affect the          * Focus on 11            mortgage        
                   viability of          diverse public and     administration, 
                   Capita's              private sector         electronic      
                   businesses. Key       markets                monitoring and  
                   elements of                                  AXELOS, our     
                   Capita's business   * Continual work to      public sector   
                   model fail to         diversify business     subsidiary      
                   adjust to             operation across       partnership with
                   changing market       new private/public     the Cabinet     
                   needs on a timely     sector markets and     Office          
                   basis and become      market segments.                       
                   diluted or                                 * Actively        
                   obsolete                                     monitored       
                                                                potential       
                 * Actions of                                   political and   
                   competitors                                  other           
                   impact Capita's                              developments    
                   competitive                                                  
                   position.                                  * Focus from CEO  
                                                                on innovation   
                                                                and             
                                                                responsiveness  
                                                                to change.      
                                                                                
Operational      * Failure to meet     * Operating            * Significant and 
delivery           contractual           performance            complex projects
                   terms, milestones     indicators in          now brought     
                   and service level     place for all          within single   
                   agreements in         business and key       division to     
                   major contracts       contracts              share management
                                                                expertise and   
                 * Delivery of         * Robust contractual     learnings       
                   contracts fail to     and governance         regarding robust
                   meet quality,         mechanism              oversight and   
                   cost or                                      support help    
                   performance         * MOB and Risk           focus right     
                   expectations          Committee              management      
                                         challenge and          oversight and   
                 * Financial client      oversight              support         
                   service penalties                                            
                                       * Risk-based           * Refreshed risk  
                 * Mismanagement of      independent            governance      
                   complex client        assurance (GIA)        through new     
                   relationship                                 framework to    
                   structures          * Cross-relationship     track issues and
                                         operational,           mitigate        
                 * Loss of contract.     technical and          earlier.        
                                         commercial                             
                                         oversight and                          
                                         governance.                            
                                                                                
Duty of care     * Failure to          * Safeguarding         * Successful      
                   provide adequate      policy, process        introduction of 
                   duty of care to       and standards          Group-wide      
                   staff,                                       Safeguarding    
                   stakeholders,       * Widespread focus       policy          
                   clients and end       on `conduct risk'                      
                   customers of our      and the delivery     * New health &    
                   services              of end customer        safety and      
                                         outcomes               property portal 
                 * End customer                                 for reporting   
                   detriment           * Rigorously applied     and issue       
                                         Group-wide health      tracking/       
                 * Adverse impact on     and safety policy,     resolution.     
                   wellbeing of our      process, training                      
                   employees             and audits                             
                                                                                
                 * Failure of health   * Incident                               
                   and safety            management system                      
                   compliance            that includes                          
                                         issues around duty                     
                 * Failure of            of care                                
                   clinical                                                     
                   governance in our   * Robust operational                     
                   health-related        monitoring and                         
                   businesses.           oversight of our                       
                                         health-related                         
                                         activities.                            
                                                                                
Technical        * Failure to          * Adoption of          * Appointment of  
infrastructure     provide adequate      industry standard      CIO to take     
and resilience     IT services to        managed service        forward greater 
                   support core          standards and          development of  
                   services and          controls               Group's IT      
                   business needs                               strategy and    
                                       * Robust business        central         
                 * Loss of core          continuity/            provisioning    
                   systems/              disaster recovery                      
                   technology with       programme            * Commencement of 
                   long term impact                             Group-wide      
                   on client           * Deployment of          business impact 
                   delivery              issue detection        assessments to  
                                         software and           draw up single  
                 * System resilience     resolution             view of         
                   and stability         practices              resilience      
                   does not meet                                issues          
                   service delivery    * Adoption, where                        
                   needs or              appropriate, of      * Acquisitions of 
                   expectations          ISO27001 standards     Updata and other
                                                                IT/ network     
                 * Legacy system       * Investment into        firms strengthen
                   maintenance           upgraded core IT       our core network
                                         infrastructure.        provision       
                 * Inadequate                                                   
                   business                                   * Development of  
                   continuity/                                  cloud capability
                   disaster recovery                            and move of core
                   arrangement.                                 systems         
                                                                commenced in    
                                                                2014.           
                                                                                
Information      * Exposures and       * Group-wide           * Refresh of our  
security           subsequent            policies and           Group           
                   contractual and       procedures             Information     
                   regulatory                                   Security        
                   penalties brought   * Single information     standards       
                   about through         security framework                     
                   failure to                                 * Group-wide      
                   protect             * Risk Committee         information     
                   information/ data     oversight at all       threat          
                   assets of Capita,     business levels        assessment with 
                   our clients or                               assistance of   
                   end customers       * Staff training and     third party     
                   from loss, theft,     monitoring             consultancy     
                   alteration or         programme                              
                   destruction                                * Recognition of  
                                       * Incident               importance of   
                 * Failure in the        management system      Cyber Security  
                   mechanisms to                                risks by Board. 
                   secure or recover   * Cross-Group forum                      
                   sensitive             to evaluate issues                     
                   information           and effective                          
                                         controls                               
                 * Loss or theft of                                             
                   intellectual        * Local divisional                       
                   property              skilled specialist                     
                                         information                            
                 * Cyber crime.          security resource.                     
                                                                                
Human            * Failure to          * Comprehensive        * Further roll out
resources          attract, manage       succession             of our vetting  
                   or retain             planning               process to new  
                   sufficient,                                  Capita          
                   skilled or          * Continual              businesses and  
                   experienced staff     development and        internal movers 
                                         performance            to sensitive    
                 * Morale issues         management             roles           
                   impact                                                       
                   productivity and    * Extensive training   * Refresh of      
                   innovation            and development        `Speak Up'      
                                         for all staff and      Public Interest 
                 * Costs of              management             Disclosure      
                   increased/                                   Policy          
                   excessive           * Comprehensive                          
                   turnover of staff     screening/vetting    * Talent          
                                         process in line        management      
                 * Impact on             with roles             initiatives     
                   Capita's                                     launched to     
                   credibility as an   * Whistleblowing         identify and    
                   employer              line to ensure any     nurture existing
                                         significant staff      Capita talent.  
                 * Key person            issues can be                          
                   reliance/             reported and                           
                   management            escalated                              
                   stretch.              appropriately.                         
                                                                                
Partnerships/    * Contractual         * Group outsourcing    * Refresh and     
third parties/     dispute with          (material              roll-out of     
outsourcing        contracted firms      suppliers) policy      revamped        
                                                                material        
                 * Disruption to       * Review of key          suppliers policy
                   supply chain          third party                            
                                         contracts by         * Greater controls
                 * Service               commercial teams       over contract   
                   interruption                                 documentation   
                   where reliance is   * Monitoring of key      and retention   
                   placed on the         outsourced                             
                   resilience of         services Service     * AXELOS public   
                   partner, third        Level Agreements       sector          
                   party or              (SLAs)                 subsidiary      
                   outsourced                                   partnership with
                   relationship        * Partnership            Cabinet Office  
                                         governance             launched January
                 * Partners and/or                              2014.           
                   third parties do    * Business                               
                   not act within        resilience                             
                   the intended          arrangement of                         
                   limits of their       third parties in                       
                   authority or do       place to protect                       
                   not perform in a      key services.                          
                   manner consistent                                            
                   with Capita's                                                
                   strategies and                                               
                   objectives                                                   
                                                                                
                 * Liabilities for                                              
                   actions of third                                             
                   parties                                                      
                                                                                
                 * Failure in third                                             
                   parties                                                      
                   governance/                                                  
                   inappropriate                                                
                   business                                                     
                   practices.                                                   
                                                                                
Integration,     * Planned synergies   * Due diligence on     * Refreshed       
transition and     failing to            broad                  approach to     
change             achieve targets       categorisation of      business        
                                         risk exposures         integration     
                 * Detrimental                                  focusing on     
                   impact on growth    * `Black Hat'            local management
                   and performance       governance process     ownership with  
                   of business                                  appropriate     
                                       * Group Board review     oversight.      
                 * Integration           and approval of                        
                   challenges            acquisition and                        
                   resulting in          significant bids                       
                   increased                                                    
                   operational risks   * Commercial and                         
                                         contractual terms                      
                 * Mispricing of         closely reviewed                       
                   long term major       to ensure clarity                      
                   contracts                                                    
                                       * Early adoption of                      
                 * Impairment of         MOB & risk                             
                   goodwill and          management                             
                   intangible assets     processes                              
                   through                                                      
                   underperformance    * Emerging risk                          
                   or unforeseen         review and                             
                   developments in       appropriate                            
                   acquired              escalation                             
                   businesses                                                   
                                       * Integration and                        
                 * Multi-stakeholder     transition process                     
                   relationships                                                
                                       * Strong financial                       
                 * Mismanagement of      controls operated                      
                   priority              by unified                             
                   deliverables and      financial                              
                   business as           structure and                          
                   usual.                system                                 
                                                                                
                                       * Robust change gap                      
                                         analysis                               
                                         activities and                         
                                         remediation                            
                                         planning.                              
                                                                                
Financial        * Risk of financial   * Strong financial     * Group Internal  
exposure           loss or failure       controls operated      Audit reviews of
                   to operate within     by a unified           completeness of 
                   financial targets     finance structure      income across   
                   as a consequence      and system             spread of       
                   of external or                               businesses      
                   internal            * Monthly finances                       
                   vulnerabilities       reviewed in MOB      * Introduction of 
                                                                "My Purchasing" 
                 * Adverse effect on   * Rigorous capital       process to      
                   business              expenditure            strengthen      
                   financial             approval and           procurement     
                   performance from,     monitoring             controls and    
                   e.g. mispricing,      controls               link to         
                   performance                                  invoicing.      
                   issues, client      * Robust procurement                     
                   dispute or            process to further                     
                   changing market       strengthen                             
                   landscape             expenditure                            
                                         controls                               
                 * Adverse investor                                             
                   impact (share       * Business disposal.                     
                   price).                                                      
                                                                                
Legal risk       * Failure to comply   * Commercial and       * New Commercial  
                   with legislative,     contractual terms      Risk Awareness  
                   contractual,          closely reviewed       training        
                   fiduciary,            to ensure clarity      launched for    
                   statutory and/ or                            wider business  
                   judicial            * Contractual            leadership to   
                   requirements          warranty               enhance         
                                                                knowledge of key
                 * Criminal            * Monitoring and         contracting     
                   liability.            tracking of            process and     
                                         legislative            commercial risk 
                                         requirements           management.     
                                         across all Capita                      
                                         jurisdictions                          
                                                                                
                                       * Proactive and                          
                                         reactive Group                         
                                         legal support.                         
                                                                                
Financial        * Financial impact    * Board led            * Appointment of  
crime              of fraud              anti-corruption        new Group Head  
                                         and anti-fraud         of Financial    
                 * Significant civil     culture; zero          Crime Prevention
                   and criminal          tolerance approach     to better       
                   penalties in          with robust            coordinate Group
                   cases of bribery/     disciplinary           policies and    
                   corruption and        process                standards       
                   subsequent                                                   
                   potential           * Formal risk          * Enhanced        
                   prohibition from      assessment of          policies and    
                   public sector         vulnerabilities        oversight of    
                   contracts                                    financial crime 
                                       * Appropriate            risks in Group  
                 * Exposure to           policies and           to reflect      
                   parties               procedures in          growth of Capita
                   exploiting            place including a      into new sectors
                   vulnerabilities       Group-wide             and             
                   through a variety     whistleblowing         jurisdictions   
                   of fraudulent or      policy                                 
                   criminal acts                              * Refresher       
                                       * Comprehensive          training        
                 * Failure in            training of senior     undertaken for  
                   supervision or        management across      Board and senior
                   corrective            Capita                 management on   
                   actions                                      bribery risks.  
                   associated with     * Fraud                                  
                   financial crime.      investigations                         
                                         team to                                
                                         investigate and                        
                                         prosecute cases,                       
                                         identify root                          
                                         causes and embed                       
                                         remedial work.                         
                                                                                
Regulatory       * Non-compliance of   * Appropriate          * Introduction of 
risk               our businesses        policies and           consumer credit 
                   with the              processes              regulation by   
                   requirements of                              FCA managed     
                   regulated bodies    * Monitoring by          across Group    
                   in the UK or          compliance teams       firms           
                   overseas              in Group,                              
                                         Divisions and        * Ongoing         
                 * Regulatory,           Business units and     relationship    
                   financial and         Internal Audit         with FCA        
                   contractual           oversight              maintained      
                   penalties                                                    
                                       * Supervisory teams    * New regulator   
                 * New regulatory                               for Group firms 
                                       * Rigorously applied     with the        
               requirements for          environmental          purchase of a   
               emerging Capita           policy and process     Solicitors      
               businesses                                       Regulatory      
                                       * Measure and manage     Authority       
                 * Non-compliance        carbon footprint       supervised firm 
                   with                  exposure and                           
                   environmental         achieve energy       * Further         
                   regulations.          reduction              development of  
                                                                knowledge of our
                                       * Reduction in paper     exposures to    
                                         use and increase       Ofcom, Ofgem    
                                         in recycling.          regulatory      
                                                                regimes.        
                                                                                
Brand and        * Internal or         * Centralised          * Further         
reputation         external              proactive PR team      strengthening of
                   activities and                               management      
                   events affect       * Incident support       control around  
                   Capita's brand or     by internal PR         key contracts   
                   reputation            team                   such as the     
                                                                Recruitment     
                 * Failure to          * Reactive PR            Partnering      
                   maintain client       strategy in            Project to      
                   or market sector      association with       provide even    
                   trust in the          business, clients      greater line of 
                   Capita brand          and public sector      sight for Board 
                                         subsidiary                             
                 * Threat of hostile     partnerships         * Greater         
                   or sustained                                 understanding   
                   media attention     * Investor relations     across business 
                   towards Capita        strategy to            of activities of
                   businesses and        develop and            central PR team 
                   activities or         maintain open                          
                   corporate actions     relationships with   * Re-launch of    
                                         investment             Capita values,  
                 * Adverse investor      community.             emphasising     
                   impact.                                      service delivery
                                                                excellence and  
                                                                fair treatment  
                                                                of customers    
                                                                                
                                                              * Increased       
                                                                recognition of  
                                                                potential brand 
                                                                and reputation  
                                                                risks through   
                                                                specific        
                                                                inclusion on the
                                                                risk framework. 

Related party transactions

Compensation of key management personnel

                                 2014             2013      
                                                             
                                   £m               £m       
                                                             
Short term employment             9.0              8.1       
benefits                                                     
                                                             
Pension                           0.2              0.2       
                                                             
Share based payments              6.8              6.0       
                                                             
Total                            16.0             14.3      

Gains on share options exercised in the year by Capita plc executive directors
were £6.6m (2013: £5.2m) and by key management personnel £2.1m (2013: £1.1m),
totalling £8.7m (2013: £6.3m).

During the year, the Group rendered administrative services to Smart DCC Ltd, a
wholly owned subsidiary which is not consolidated. The Group received £25.8m of
revenue for these services. The services are procured by Smart DCC on an arm's
length basis under the DCC licence. The services are subject to review by Ofgem
to ensure that all costs are economically and efficiently incurred by Smart
DCC.

Capita Pension and Life Assurance Scheme is a related party of the Group.
Transactions with the Scheme are disclosed in note 32 - Employee benefits on
page 154.

The following companies are substantial shareholders 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). The number of shares held on 18
February 2015 was as below:

Shareholder                            No. of shares       % of voting rights  
                                                                               
Marathon Asset Management LLP            22,933,805               3.46         
                                                                               
Woodford Investment Management LLP       35,060,250               5.30         
                                                                               
Invesco Asset Management                 68,877,348               10.41        
                                                                               
Veritas Asset Management LLP             48,291,643               7.30         
                                                                               
Legal & General Investment               19,920,066               3.01         
Management                                                                     

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

A Parker             G M Hurst*
Chief Executive      Group Finance Director

25 February 2015


Forward-looking statement

The Directors present the annual report for the year ended 31 December 2014
which includes the strategic report, governance and audited Group accounts for
the year. Pages 1 to 108 of the annual report comprise a report of the
Directors that has been drawn up and presented in accordance with English
company law and the liabilities of the Directors in connection with that report
shall be subject to the limitations and restrictions provided by such law.
Where we refer in this report to other reports or material, such as a website
address, this has been done to direct the reader to other sources of Capita
information which may be of interest to the reader. Such additional materials
do not form part of the report.

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

*G M Hurst retired from the Board on 28 February 2015