Additional information provided by the finance director " lf Charles Smith retired two years early the company would have to pay an extra 20 000 lump sum into the pension scheme. The building housing the IT department was on a three year lease and the company was committed to an annual rental of 10 000 per year for that period. This building could be sublet if IT were outsourced generating 4 000 in the first year, 8 000 in the second and 10 000 in the final year of the lease. " Current forecasts of consumables in the IT department are 5000, 6000 and 7000 over the next three years. " The resale value of the IT equipment bought last year is 30 000. " Annual overheads for the IT department are 2? 000 per year. 60% of the overhead varies with staff numbers, the remaining 40% is a share of central overhead charges. Required You have been appointed as a consultant to prepare a report analysing the outsourcing proposal, including both the financial and non-financial effects, and give your recommendations