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Tuesday 08 February, 2005


Final Results

08 February 2005

                                     QA plc
                      ("QA", "the Group" or "the Company")

            Preliminary Results for the year ended 30 November 2004

QA plc, the training and consulting company, today announces Preliminary Results
                      for the year ended 30 November 2004.


   •Turnover from continuing operations was £30.2 million, a 3% increase on
    the previous year
   •Adjusted* operating loss of £0.2 million (2003: £0.4 million loss) with
    an adjusted operating profit in the second half of the year of £0.6 million
   •After goodwill amortisation of £0.2 million (2003: £0.3 million) and
    operating exceptional charges of £2.4 million (2003: £2.9 million) the basic
    operating loss was £2.9 million (2003: £3.6 million)
   •Non-operating exceptional gains of £0.6 million (2003: £0.6 million) were
   •Year-end net cash balance of £0.3 million (2003: £5.2 million net
   •Strategic initiatives in outsourcing and in partnering delivering value
   •Quarter One 2005 will be the fourth consecutive quarter showing
    improvement in trading results on the comparable quarter in the previous

*Adjusted loss per share is attributable to continuing operations excluding
goodwill amortisation and exceptional items

Keith Burgess, Executive Chairman, commented:

"The actions that we have taken are beginning to bear fruit. Furthermore, there
are signs of a cyclical improvement in the training market. The strengthening
revenue trend which I mentioned in our November trading update has continued
into 2005 and bookings are comfortably ahead of 2004. This reinforces our
confidence for the remainder of the current financial year."

For further information please contact:

QA plc 020 7656 8495
Keith Burgess, Executive Chairman

                                     QA plc

                      ("QA", "the Group" or "the Company")

            Preliminary Results for the year ended 30 November 2004

                              Chairman's Statement


2004 has seen a significant improvement in our position. The Placing and Rights
Issue early in 2004 strengthened our balance sheet and gave us the resources to
settle a significant commercial dispute. Since the end of the first quarter, we
have seen improvements on the previous year trading performance in each
consecutive quarter. We have maintained tight control of our costs and cash. We
start the new year with better prospects than for some time.

Financial results

Total revenue at £30.2 million grew by 3% in the year which, when compared with
a revenue loss of 3% at the half year, shows a much improved performance in the
second half of the year. Operating loss before goodwill amortisation and
exceptional operating charges ('adjusted operating loss') was £0.2 million
compared with £0.4 million in 2003. This reflected an adjusted operating profit
of £0.6 million in the second half of the year.

Exceptional operating costs arising from limited restructuring charges, a
write-down in the carrying value of our Belgian freehold property and goodwill
impairment totalled £2.4 million (2003: £2.9 million).

Exceptional non-operating gains totalling £0.6 million (2003: £0.6 million) were
also recorded. These mainly derived from a settlement in QA's favour of a
deferred consideration obligation arising from a business sold in 1998. In view
of the uncertainty attaching to its receipt, this potential consideration had
not been recorded as receivable.

After these net exceptional charges, goodwill amortisation of £0.2 million
(2003: £0.3 million) and net interest payable of £0.2 million (2003: £0.2
million), the loss before tax was £2.4 million (2003: £3.2 million).

QA finished the year with a net cash balance of £0.3 million, compared with net
borrowings of £5.2 million in 2003. Despite cash outflows in relation to
non-operating property provisions and the small trading loss, the £5.8 million
net proceeds of the Placing and Rights Issue have been conserved through good
working capital management to ensure that the balance sheet remains healthy.

Operating Performance

The overall improvement in revenue for the year as a whole represents a
significant change from the 11% loss of revenue experienced in 2003. It is all
the more noteworthy since the rate of revenue decline experienced in 2003
continued through the first quarter of 2004. We have seen revenue improvements
in training against prior year comparatives from the second quarter onwards and
particularly in the last three months of the year. While overall consulting
revenue declined we have seen an improvement in the quality of consulting
revenue as, in line with our strategic intent, we have moved from contracts
based on providing skilled individuals to projects that leverage our learning
consulting capabilities.

While the improvements that we have seen may, in some part, be due to a general
improvement in the market for training, we also believe that we are seeing the
benefits of a number of the strategies that we have put in place:

   •the number of organisations for whom we provide outsourced training
    services has increased with the commencement of contracts at Norwich Union
    and Vodafone. We have also increased the yield from existing contracts;
   •we have strengthened our strategic partnerships, becoming an authorised
    Oracle training delivery partner and extending our alliance with Microsoft
    where we have delivered a number of training programmes for their business
    partners. Our partnership with e-learning provider SkillSoft has generated
    new business, specifically blended learning projects in business skills for
    global companies;
   •we have delivered a number of projects for major organisations to support
    enterprise-wide change programmes where our capabilities in providing
    blended learning solutions and in aligning our technical and managerial
    specialisms with our training delivery capabilities has been critical;
   •our Academy programme of high level management and technical seminars for
    managers has delivered new revenue and facilitated relationships with senior
    managers across the breadth of client organisations.

As well as our strategic initiatives, we have not neglected our core business.
In the first quarter, we relocated a training centre from Cirencester to
existing QA premises in Swindon, upgrading the facilities available to delegates
as well as achieving further cost efficiencies through the surrender of another
property lease. In August, we expanded our flagship centre in Holborn, London
through the addition of eight training rooms.

40 new courses were introduced and successful programmes were expanded during
2004. We promoted our project management training in the PRINCE2 methodology in
response to strong market demand. We launched analyst training to support the
growing demand for Information Systems Examination Board (ISEB) certification
and became an accredited training provider in the Service Management arena (one
of the strongest growing training areas), delivering our first courses in
January 2005.

We also maintained our reputation for quality and excellence. QA was named
Training Company of the Year 2005 at the recent Institute of IT Training awards;
a QA trainer won the prestigious British Computer Society Trainer of the Year
award; and we won the Microsoft European Certified Learning Partner Solution of
the Year award (for the third time in four years).

Legacy Issues

Over the last 12 months, we have continued to make progress in relation to the
Group's non-operational properties. All such properties for which QA has
extended forward lease commitments (with the single exception of an unused
quarter of our Swindon building) have now been sublet, albeit in some cases at
current market rental levels which are below the head lease rent.


The Board does not recommend the payment of a final dividend (2003 - £nil).

Board and employees

In a year of significant progress, I would like to record my thanks to the
management team and staff of QA. Their quality and commitment is central to
maintaining the market standing of QA and achieving its successful recovery. I
am very grateful to them for their ongoing commitment and positive response to
the ever-increasing demands of the market.


The actions that we have taken are beginning to bear fruit. Furthermore, there
are signs of a cyclical improvement in the training market. The strengthening
revenue trend which I mentioned in our November trading update has continued
into 2005 and bookings are comfortably ahead of 2004. This reinforces our
confidence for the remainder of the current financial year.

Keith Burgess
Executive Chairman
                                    - ends -

For further information please contact:

QA plc 020 7656 8495

Keith Burgess, Executive Chairman

Group profit and loss account
QA plc and its subsidiary companies for the year ended 30 November 2004

                                         2004          2004     2004       2003
                        Notes   pre-exceptional exceptional    Total   Restated

                                        £'000         £'000    £'000      £'000
Turnover                    2          30,153             -   30,153     29,158

Operating loss
                                       -------       -------  -------    -------
Operating loss
before amortisation
of goodwill and
exceptional items                        (199)            -     (199)      (394)
Amortisation of
goodwill                    2            (227)            -     (227)      (333)
                                       -------       -------  -------    -------
Operating loss
before exceptional
items                                    (426)            -     (426)      (727)
exceptional items           3               -        (2,439)  (2,439)    (2,898)
                                       -------       -------  -------    -------

Operating loss              2            (426)       (2,439)  (2,865)    (3,625)

Profit on disposal
of businesses               3               -           688      688        645
                                       -------       -------  -------    -------

Loss on ordinary
activities before
interest                                 (426)       (1,751)  (2,177)    (2,980)
Net interest
payable                                  (209)            -     (209)      (240)
                                       -------       -------  -------    -------

Loss on ordinary
activities before
taxation                                 (635)       (1,751)  (2,386)    (3,220)
Tax charge on loss
on ordinary
activities                  4             (58)         (900)    (958)      (750)
                                       -------       -------  -------    -------

Loss on ordinary
activities after
tax                                      (693)       (2,651)  (3,344)    (3,970)
attributable to
minority interests          6            (200)           39     (161)        46
                                       -------       -------  -------    -------
Retained loss for
the financial year
attributable to
equity shareholders                      (893)       (2,612)  (3,505)    (3,924)
                                       -------       -------  -------    -------

Basic and fully
diluted loss per
share                       5                                  (1.4)p     (2.5)p

Adjusted basic and
fully diluted loss
per share*                  5                                  (0.3)p     (0.3)p

* Adjusted to exclude operating and non-operating exceptional items and goodwill

All turnover and operating loss in the current and prior period relate to
continuing operations.

Group Balance Sheet
QA plc and its subsidiary companies as at 30 November 2004

                                                               2004       2003
                                                    Notes     £'000      £'000

Fixed assets

Intangible assets                                             1,877      3,507
Tangible assets                                               3,710      4,654
                                                             --------   --------

                                                              5,587      8,161
                                                             --------   --------
Current assets

Stock                                                           130         98
Debtors                                                       6,032      6,772
Cash at bank and on deposit                             7     6,562      1,114
                                                             --------   --------

                                                             12,724      7,984
                                                             --------   --------
Creditors - amounts due within one year

Borrowings                                                   (5,124)    (5,122)
Other creditors                                              (8,961)    (8,120)
                                                             --------   --------

                                                            (14,085)   (13,242)
                                                             --------   --------

Net current liabilities                                      (1,361)    (5,258)
                                                             --------   --------

Total assets less current liabilities                         4,226      2,903

Creditors - amounts due after more than one year
                                                             --------   --------

Borrowings                                                   (1,177)    (1,195)
Other creditors                                                 (66)      (428)
                                                             --------   --------
                                                             (1,243)    (1,623)

Provisions for liabilities and charges                       (1,412)    (2,163)
                                                             --------   --------
Net assets/(liabilities)                                      1,571       (883)
                                                             --------   --------

Capital and reserves
Called up share capital                                       2,864      9,548
Share premium                                                     -     46,679
Other reserves                                                1,501      1,501
Profit and loss account                                      (3,171)   (58,825)
                                                             --------   --------

Equity shareholders' funds                                    1,194     (1,097)
                                                             --------   --------

Minority interests                                      6       377        214
                                                             --------   --------

                                                              1,571       (883)
                                                             --------   --------

The accounts were approved by the Board on 8 February 2005.

Keith Burgess                          Colin J Gibson
Director                               Director

Cash Flow
QA plc and its subsidiary companies for the year ended 30 November 2004

Reconciliation of operating loss to net cash flow from operating activities

                               Pre-exceptional Exceptional    Total       2003

                                        2004          2004     2004
                                       £'000         £'000    £'000      £'000

Operating loss - before
exceptional items                       (426)            -     (426)      (727)
Operating exceptional items                -        (2,439)  (2,439)    (2,898)
                                     ---------       -------   ------     ------
                                        (426)       (2,439)  (2,865)    (3,625)

amortisation/impairment                  227         1,403    1,630      1,966
Depreciation/impairment of
fixed asset investment
properties                               637           757    1,394      1,077
Loss on fixed asset disposals             24             -       24          -
(Increase)/decrease in stock             (32)            -      (32)        30
(Increase)/decrease in debtors          (177)            -     (177)       193
Increase/(decrease) in
creditors                                390             -      390     (1,246)
(Decrease)/increase in
provisions                              (827)           76     (751)      (134)
                                     ---------       -------   ------     ------
Net cash outflow from
operating activities                    (184)         (203)    (387)     (1,739)
                                     ---------       -------   ------     ------

Consolidated cash flow statement
                                                               2004       2003

                                                              £'000      £'000
Net cash outflow from
operating activities                                           (387)    (1,739)

Returns on investments and
servicing of finance                                           ------     ------
Interest received                                               180         52
Interest paid                                                  (257)      (538)
                                                               ------     ------
                                                                (77)      (486)
Corporation tax (paid)/                                         (75)       606

Capital expenditure and
financial investment                                           ------     ------
Purchase of fixed assets                                       (512)      (258)
Disposal of fixed assets                                          2          3
Increase in cash subject to
restrictions (note 7)                                        (1,770)      (755)
                                                               ------     ------
                                                             (2,280)    (1,010)
Acquisitions and disposals
Disposal of businesses
- consideration cash received
net of costs (note 3f,
3g and 3h)                                                      688        642
                                                               ------     ------

Net cash outflow before
financing                                                    (2,131)    (1,987)

                                                               ------     ------
Proceeds from issue of share
capital                                                       6,683        334

Expenses of share issue                                        (790)         -

Purchase of shares by employee
benefit trust                                                   (70)         -

(Decrease)/increase in
borrowings                                                      (14)       335
                                                               ------     ------
Net cash inflow from financing                                5,809        669

                                                               ------     ------
Increase/(decrease) in cash in
the year                                                      3,678     (1,318)
                                                               ------     ------
Reconciliation of net cash flow to movement in net borrowings

                                                              2004       2003
                                                             £'000      £'000

Increase/(decrease) in cash in the year                      3,678     (1,318)
Increase in cash subject to restrictions                     1,770        755
Cash outflow/(inflow) from decrease/(increase) in
borrowings                                                      14       (335)
Increase in borrowing from settlement of deferred
consideration obligations                                        -       (650)
Currency translation differences                                 2          1
                                                              ------    -------
Movement in net borrowings in the year                       5,464     (1,547)
Net borrowings at 1 December                                (5,203)    (3,656)
                                                              ------    -------
Net cash/(borrowings) at 30 November                           261     (5,203)
                                                              ------    -------

Statement of total Group recognised gains and losses

                                                            2004          2003
                                                           £'000         £'000

Loss for the financial year                               (3,505)       (3,924)
Currency translation differences                             (27)          177
                                                            ------       -------
Total recognised losses for the year                      (3,532)       (3,747)
Prior year adjustment (note 1)                               126             -
                                                            ------       -------
Total recognised losses since last annual report          (3,406)       (3,747)
                                                            ------       -------

Reconciliation of movements in Group shareholders' funds

                                                               2004       2003
                                                              £'000      £'000
Opening equity shareholders' funds (as previously reported)    (955)     3,584
Prior year adjustment (note 1)                                 (142)      (268)
                                                               ------    -------
Opening equity shareholders' funds (as restated)             (1,097)     3,316
Loss for the financial year attributable to equity
shareholders                                                 (3,505)    (3,924)
Nominal value of new shares issued                            1,909        334
Premium on shares issued                                      3,984          -
Purchase of shares by employee benefit trust                    (70)         -
Exchange movement on retranslation of foreign subsidiary        (27)       177
Reduction in deferred share capital arising from settlement
of deferred consideration obligations                             -     (1,000)
                                                               ------    -------
Closing equity shareholders' funds                            1,194     (1,097)
                                                               ------    -------

There is no difference between the loss on ordinary activities before taxation
and minority interests and the historic cost loss.

1 Basis of preparation

The accounts have been prepared under the historical cost convention as modified
for the revaluation of an investment property and in accordance with the
Companies Act 1985 and applicable United Kingdom accounting standards
consistently applied, except as detailed below. As in prior years, the accounts
have been prepared on a going concern basis.

UITF Abstract 38 "Accounting for ESOP Trusts" has been applied for the first
time in the current financial year. In order to comply with UITF 38, the £70,000
cost of shares acquired during the current year by the Group's Employee Benefit
Trust ("EBT") has been deducted from the profit and loss reserve in
shareholders' funds. In addition, comparative figures have been restated. The
historic cost of the Company's shares held in the EBT that was formerly shown as
a fixed asset investment (November 2003: £2,920,000 less £2,778,000 provision
for diminution in value) is also now deducted from the profit and loss reserve
in shareholders' funds. The operating exceptional charge of £126,000 made in the
prior year in order to reflect an impairment in the value of these shares has
been adjusted directly against reserves reducing the operating loss in the year
ended 30 November 2003 from £3,751,000, as originally reported, to £3,625,000.
The Cash Flow Statement has also been restated accordingly.

2 Analysis of results

                                                             2004         2003
Turnover                                                    £'000        £'000
                                                          ---------    ---------
Continuing Operations
Training                                                   24,669       23,162
Consulting                                                  5,484        5,996
                                                          ---------    ---------
                                                           30,153       29,158
Cost of Sales                                             (17,926)     (15,970)
                                                          ---------    ---------

Gross profit                                               12,227       13,188
Selling and distribution costs                               (482)        (684)

Administrative expenses
                                                          ---------    ---------
- base                                                    (11,944)     (12,898)
- goodwill amortisation                                      (227)        (333)
- exceptional goodwill impairment charge (note 3e)         (1,403)      (1,633)
- other exceptional items (note 3b,3c,3d)                  (1,036)      (1,265)
                                                          ---------    ---------
                                                          (14,610)     (16,129)
                                                          ---------    ---------

Operating loss                                             (2,865)      (3,625)
                                                          ---------    ---------

The Group operates as an integrated business in only one market segment,
providing IT training and consulting services to a single UK customer base.
Turnover is analysed between the two major service lines to provide additional

3 Exceptional items

                                                      Note     2004       2003

                                                      (a)              Restated
                                                              £'000      £'000
Operating exceptional items
                                                              -------    -------
Restructuring costs                                   (b)      (203)         -
Property write downs and onerous lease provisions     (c)      (833)    (1,200)
Abortive acquisition costs                            (d)         -        (65)
                                                              -------    -------
                                                             (1,036)    (1,265)

Writedown to reflect impairment of carrying value of
purchased goodwill                                    (e)    (1,403)    (1,633)
                                                              -------    -------
                                                             (2,439)    (2,898)
                                                              -------    -------
Non-operating exceptional items
                                                              -------    -------
Adjustment to gain on disposal of business            (f)       550          -
Gain on disposal of companies                         (g)       138          -
Gain on GAIS settlement                               (h)         -        645
                                                              -------    -------
                                                                688        645
                                                              -------    -------
                                                             (1,751)    (2,253)
                                                              -------    -------

(a) The prior year annual report included an operating exceptional charge of
    £126,000 for the writedown of the value of the Company's shares held in the
    Group's employee benefit trust, which were disclosed as fixed asset 
    investments at the date of preparation of that annual report. In the current 
    year, the Group has adopted UITF Abstract 38 "Accounting for ESOP Trusts". 
    In accordance with this guidance, the cost of shares in the Group's employee 
    benefit trust is shown as a reduction to equity shareholders' funds rather 
    than as a fixed asset. This treatment has also been applied to the prior 
    year comparatives, with the result that the operating exceptional charge of 
    £126,000 has now been accounted for in equity shareholders' funds and so 
    does not appear in the comparatives above.

(b) Restructuring charges relate to employee severance and outplacement costs
    incurred as headcount was reduced to bring costs, infrastructure and 
    management more closely in line with the demands of the business.

(c) £757,000 (2003: £nil) of the property charges relate to the writedown of an
    interest in a Belgian freehold property to bring its carrying value in line 
    with local market levels, as assessed by the directors based on advice by 
    local professional advisors. A further £76,000 (2003: £1,200,000) has also 
    been charged as a result of the reassessment of existing onerous lease 
    provisions required on a number of existing non-operational properties to 
    reflect the absence of a sub-tenant in one case and anticipated rent 
    deficits on other properties which have been sublet.

(d) Professional fees were incurred in 2003 in relation to the Board's
    investigation of a potential acquisition before the acquisition proved 

(e) The directors have considered the value of those parts of the business which
    derive from the 1999 acquisitions of Knowledge Centre, Cap Gemini (UK) 
    Training and Pontis Consulting. The value in use of the income generating 
    units deriving from those acquisitions has been evaluated using cash flow 
    projections discounted at 17.0% (2003: 16.8%) and total goodwill impairments 
    of £1,403,000 (2003: £1,633,000) have been assessed accordingly.

(f) A cash gain of £550,000 arose during the year from the sale by the Group in
    1998 of the PSL business to its management. The gain resulted from the
    completion of a settlement agreement relating to a deferred consideration
    obligation which would crystallise should a subsequent sale or flotation of 
    the PSL business be achieved at a value above a specified level. No taxation 
    effect is expected to arise from the gain.

(g) A cash gain arose from the sale during the year of two dormant companies to
    a third party. These companies had no assets at the point they were sold but 
    had significant accumulated capital losses which the Group did not 
    anticipate a requirement for. No taxation effect is expected to arise from 
    the gain.

(h) In 2003, settlement was reached of the Group's dispute with the vendors of
    GA Information Systems Limited, a business which the Group bought in 1999 
    but subsequently sold on. This resulted in a non-cash gain by way of an 
    adjustment to the non-operating loss recorded in 2000 on the disposal of the 
    business. No taxation effect is expected to arise from the gain.

4   Tax on loss on ordinary activities

                                                             2004         2003
                                                            £'000        £'000
Analysis of charge in period

United Kingdom corporation tax at 30% (2003: 30%)
Current year                                                    -            -
                                                          ---------    ---------
                                                                -            -

Prior year                                                     14         (154)
                                                          ---------    ---------
                                                               14         (154)
Deferred tax
                                                          ---------    ---------
Current year                                                  900        1,442
Prior year                                                      -         (624)
                                                          ---------    ---------

                                                              900          818
Overseas taxation
Current year                                                   51           86
Prior year                                                     (7)           -
                                                          ---------    ---------
                                                               44           86
                                                          ---------    ---------
                                                              958          750
                                                          ---------    ---------

The deferred tax charge of £900,000 in 2004 arises from a decision that,
following three successive years of recording taxable losses and in accordance
with Financial Reporting Standard 19 - Deferred Tax, it is no longer appropriate
to attribute a recoverable value to trading losses carried forward and fixed
asset timing differences. The deferred tax charge of £818,000 in 2003 related to
the reassessment of the recoverability of deferred tax assets offset in part by
the release of provisions held against a number of contingencies where the risk
of crystallisation has now passed. These charges are exceptional in view of
their significant value.

At the year-end there was an unrecognised deferred tax asset estimated at £3.2
million (2003 : £2.0 million). The trading losses and fixed asset timing
differences which make up this deferred tax asset are available to reduce future
UK taxable trading profits subject to agreement with the Inspector of Taxes.

5    Earnings per share

Reconciliations of the earnings and weighted average number of shares used in
the EPS calculations are set out below.

                                     2004                                      2003
                 Earnings         Weighted          Pence   Earnings        Weighted      Pence per 
                            average number      per share             average number          share
                                 of shares                                 of shares
                    £'000             '000                     £'000            '000        
                                                            Restated        Restated       Restated
----------------    -------        -------        --------   --------        -------         -------
Basic EPS
to ordinary
shareholders       (3,505)         253,173          (1.4)    (3,924)         161,330          (2.5)
                    -------        -------                   --------        -------         -------

Adjusted Basic

Basic EPS          (3,505)         253,173          (1.4)    (3,924)         161,330          (2.5)

net profit on
items                (688)                          (0.3)      (645)                          (0.4)
mpairment           1,630                            0.7      1,966                            1.3
                    -------        -------        --------   --------        -------         -------
IIMR loss          (2,563)         253,173          (1.0)    (2,603)         161,330          (1.6)
charges (net
of tax)             1,036                            0.4      1,265                            0.8
tax charge            900                            0.3        818                            0.5
charges (net
of tax)
to minority
interests             (39)                           0.0          -                              -
                    -------        -------        --------   --------        -------         -------
Adjusted Basic
EPS                  (666)         253,173          (0.3)      (520)         161,330          (0.3)
                    -------        -------        --------   --------        -------         -------

The EPS figures for the year ended 30 November 2003 have been restated as a
result of the adjustment to the operating loss described in note 3a. In
addition, in accordance with FRS14, all EPS figures for the prior year have been
restated to allow for the effect of the issue for cash and the rights issue (the
"Issues") made by the Company in the current year. FRS 14 "Earnings per share"
requires the number of shares in issue used in the EPS calculation to be
adjusted for the notional bonus element of the Issues, represented by the
discount in the Issues share price relative to the market.

Basic earnings per share is calculated by dividing the earnings attributable to
ordinary shareholders by the weighted average number of shares in issue during
the year. In accordance with the provisions of FRS 14 "Earnings per share" there
is no present dilution from convertible loan notes, outstanding share options or
potential vestings under the Group's long term incentive plan. There was also no
dilution from these sources in the prior year.

Adjusted earnings per share is based on the continuing operations' result before
goodwill amortisation and operating, non-operating exceptional charges and
exceptional tax charges and is presented to show a clearer representation of the
underlying result of the Group.

6    Minority Interests


At 1 December 2003                                                         214

Profit/(loss) attributable to minority interests for the year
- base                                                                      75
- exceptional                                                              (39)
Increase in minority interests attributable to renegotiation of
agreements*                                                                125
Difference on exchange                                                       2
At 30 November 2004                                                        377

*The contractual agreements that have been renegotiated, resulting in a change
in the minority interests, relate to the P&P group of companies, a group of
Belgian registered companies in which the Group has a majority interest.
7   Cash

Cash at bank and on deposit at 30 November 2004 includes £2,525,000 (2003:
£755,000) held on deposit which is subject to restrictions. This amount provides
collateral against the loan note guarantee facility provided by the Group's
principal bank and may not be withdrawn from the account without the agreement
of the bank.
8   Share subdivision, rights issue and capital reorganisation

Pursuant to resolutions passed at an Extraordinary General Meeting on 9 February
2004, each of the Company's 10p Ordinary Shares were sub-divided into one 1p
Ordinary Share and nine 1p Deferred Shares. The Company then undertook an issue
for cash and a one for one rights issue (the "Issues"), which were successfully
completed by March 2004. The Issues were each of 95,479,703 shares and were made
for a total cash consideration of £6,683,579, including a premium of £4,773,985.
Subsequently, with the approval of the High Court, the full £8,593,000 cost of
the Deferred Shares was cancelled against the profit and loss reserve and the
share premium account was reduced by £50,663,000, also by a transfer to the
profit and loss reserve. As a result of this reduction of the Share Premium
Account and the charging to the Share Premium Account of the costs of the
Issues, which were £790k, the Share Premium Account was reduced to £nil. These
transfers were made in order to reduce the deficit on the Company's profit and
loss reserve. The Company undertook to the Court that it would create an
undistributable special reserve (the "Special Reserve") of £3,688,932 for the
protection of creditors that cannot be released until all of the Company's
admissible creditors at 20 March 2004 are paid. The Special Reserve forms part
of the profit and loss reserve and is not disclosed separately in the balance
sheet of the Group. At 30 November 2004, there had been no reductions nor other
amendments to the Special Reserve, which stood at £3,688,932.

9   The results from the year ended 30 November 2004 are abridged from the
Group's full report and accounts on which the auditors will give an unqualified
opinion. The Group accounts include the accounts of the Company and all its
subsidiaries made up to the end of the financial year. The accounts have
therefore been prepared for the 52 weeks ended 30 November 2004 (2003: 52 weeks
ended 30 November 2003). The Group's full report and accounts for the year ended
30 November 2004 will be filed with the Registrar of Companies in due course and
will include the unqualified Auditor's report. The balances have been extracted
from the 2003 statutory accounts as amended by UITF38 "Accounting for ESOP

10  Copies of the Group's full report and accounts will be sent to all
shareholders in due course. Additional copies will be available from the
Company's registered office, QA plc, QA House, Delta Office Park, Welton Road,
Swindon, SN5 7WZ.

11  The Annual General Meeting will be held on 24 March 2005.

12  At a meeting held on 3 February 2005, the Board of QA plc recommended that
no final dividend be paid to shareholders.
13  This statement constitutes non-statutory accounts within the meaning of
Section 240 of the Companies Act 1985 and was approved by the directors and
agreed with the Company's auditors PricewaterhouseCoopers LLP on 8 February

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