ICON p.l.c. and Subsidiaries Annual Report Year ended 31 December 2011 Registered number 145835 Directors' Report and Consolidated Financial Statements Contents Page Directors and Other Information 2 Directors' Report 3

ICON p.l.c. and Subsidiaries

Year ended 31 December 2011

Registered number145835

Directors' Report and Consolidated Financial Statements

Directors' and Other Information

The Directors present their report and audited Consolidated and Company financial statements of ICON p.l.c. ("the Company" or "ICON"), a public limited company incorporated in the Republic of Ireland, and its subsidiary undertakings ("the Subsidiaries", with the Company and the Subsidiaries being together "the Group") for the year ended 31 December 2011.

The Company's primary listing for its shares is the NASDAQ market. The Company also has a secondary listing on the Irish Stock Exchange and, accordingly, is not subject to the same ongoing regulatory requirements as those which would apply to an Irish company with a primary listing on the Irish Stock Exchange, including the requirement that certain transactions require the approval of shareholders. For further information, shareholders should consult their own financial adviser. The Company is considered a foreign private issuer in the US, accordingly it is not subject to the same ongoing regulatory requirements as a US registered company with a primary listing on the NASDAQ market.

These Consolidated and Company financial statements (together "the financial statements") for the year ended 31 December 2011 are prepared in accordance with IFRS as adopted by the EU and meet the reporting requirements pursuant to Irish Company Law and the Irish Stock Exchange Listing Rules. In addition to the consolidated financial statements contained in this annual report, we also prepare separate consolidated financial statements on Form 20-F pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (SEC) and in accordance with accounting principles generally accepted in the United States (U.S. GAAP). The Form 20-F under U.S. GAAP is a separate document, a copy of which may be obtained from the Company's website www.iconplc.com. IFRS differs in certain respects from U.S. GAAP, details of which are set out on pages 140 to 143 of this annual report.

Principal activities, business review and future developments

The Group is a contract research organisation ("CRO"), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. The Group specialises in the strategic development, management and analysis of programmes that support all stages of the clinical development process - from compound selection to Phase I-IV clinical studies.

The Group believes that it is one of a select number of CRO's with the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and has the operational flexibility to provide development services on a stand alone basis or as part of an integrated "full service" solution. At 31 December 2011, the Group had approximately 8,470 employees, in 81 locations in 40 countries. During the year ended 31 December 2011, the Group derived approximately 41.7%, 46.2 % and 12.1% of its net revenue in the United States, Europe and Rest of World, respectively.

Headquartered in Dublin, Ireland, the Group began operations in 1990 and has expanded the business predominately through internal growth, together with a number of strategic acquisitions, to enhance its capabilities and expertise in certain areas of the clinical development process. Its principal executive office is located at: South County Business Park, Leopardstown, Dublin 18, Republic of Ireland. The contact telephone number of this office is 353 (1) 291 2000.

On 28 February 2012, the Group acquired PriceSpective, a global leader in value strategy consulting. Headquartered in Philadelphia (USA), and with offices in London (UK), Los Angeles (USA), San Diego (USA), Raleigh (USA) and Boston (USA), PriceSpective is a premier consultancy that has a strong reputation for excellence in strategic pricing, market access, health economic outcomes research (HEOR), due diligence support and payer engagement services. Since it's formation in 2003, PriceSpective has developed strategies for dozens of new product launches, and hundreds of development and in-market products, in over 40 disease areas.

On 15 February 2012, the Group acquired BeijingWits Medical Limited, a leading Chinese CRO, with over 100 highly qualified and experienced professionals in Beijing, Shanghai, Chengdu, Guangzhou, Wuhan and Hong Kong.

On 14 July 2011, the Group acquired Firecrest Clinical, a market leading provider of technology solutions that boost investigator site performance and study management. Headquartered in Limerick, Ireland, Firecrest Clinical provides a comprehensive site performance management system that is used to improve compliance consistency and execution of activities at investigative sites

Directors' Report (continued)

On 14 January 2011, the Group acquired Oxford Outcomes, a leading international health outcomes consultancy, headquartered in Oxford, UK, and with offices in the USA and Canada. Oxford Outcomes provides specialist services in the areas of patient reported outcomes (PRO), health economics, epidemiology and translation and linguistic validation.

In 2012, the Group looks forward to increasing its geographic presence through the addition of new offices and expanding the scale and range of its service offering.

Results and dividends

The results for the year are as shown on page 54 of these financial statements. A review of performance during 2011 is included in the Operating and Financial Review section of this annual report. The Directors do not propose the payment of a dividend for the year ended 31 December 2011.

Risks and uncertainties

Details of the principal risks and uncertainties facing the Group are set out in Appendix A of this annual report.

Financial risk management

The Group's financial instruments comprise cash and cash equivalents, current asset investments, finance lease obligations and negotiated bank facilities. The main purpose of these financial instruments is to fund the working capital requirements of the Group, the cost of new acquisitions and continued growth. The principal financial risks facing the Group includes currency rate risk, interest rate risk, credit risk and liquidity risk, further details of which are set out in note 25 to the Consolidated financial statements and note 11 to Company financial statements. The Group may from time to time enter into derivative transactions to minimise its exposure to interest rate fluctuations and foreign currency exchange rates. The Group does not undertake any trading activity in financial instruments. The Group did not enter into any material derivative transactions during 2011 or 2010.

Details of subsequent events are set out in note 30 to the financial statements.

Amendment of the Company's Articles of Association

The Company's Articles of Association may be amended by a special resolution passed by the shareholders at an annual or extraordinary general meeting of the Company. A special resolution is passed at a meeting if not less than 75% of the members who vote in person or by proxy at the meeting vote in favour of the resolution.

Directors and Secretary

On 31 December 2011, Dr Anthony Murphy resigned as Director of the Company.

On 1 October 2011, Mr Ciaran Murray was appointed as a Director of the Company and on the same day he resigned as Secretary of the Company. On 1 October 2011, Mr Diarmaid Cunningham was appointed Secretary of the Company.

On 13 October 2010, the Board appointed Ms Cathrin Petty a Director of the Company. In accordance with the Articles of Association of the Company, Ms Petty was re-elected as a Director of the Company at the Company's Annual General Meeting on 18 July 2011.

Details of Directors' interests in the Group's shares are set out in the Report of the Compensation and Organisation Committee. Save as shown in the Compensation and Organisation Committee report, no Director had any disclosable interest in shares of the Group during the year.

Directors' Report (continued)

Directors' remuneration

Details of Directors' remuneration is set out in the Report of the Compensation and Organisation Committee.

Directors power to purchase and allot company shares

Subject to the provisions of the Companies Acts 1963 to 2009 the Company may purchase any of its shares. Every contract for the purchase of shares, or under which the Company may become entitled or obliged to purchase shares in the Company shall be authorised by a special resolution of the Company. The Company may cancel any shares so purchased or may hold them as treasury shares or re-issue them.

On 27 October 2011, the Company announced its intention to commence a share repurchase programme of up to $50 million. On 22 November 2011, the Company entered into two separate share repurchase plans of up to $10 million each, covering the periods 23 November 2011 to 31 December 2011 and 1 January 2012 to 20 February 2012 respectively. On 21 February 2012 the Company entered into a third share repurchase plan of up to $20 million, covering the period 22 February 2012 to 22 April 2012. On 27 April 2012 the Company entered into a fourth share repurchase plan of up to $20 million, covering the period 27 April 2012 to 18 July 2012. The Company may to enter further share repurchase plans, to effect the share repurchase programme in accordance with Rule 10b-18 and Rule 10b5-1 of the Securities Exchange Act of 1934, the authorisation granted at the Company's annual general meeting on 18 July 2011, applicable laws and regulations and the Listing Rules of the Irish Stock Exchange. Further details of the share repurchase programme can be found in note 23 to the financial statements.

Rights and Obligations attaching to the Company's shares

The share capital of the Company is 6,000,000 divided into 100,000,000 ordinary shares of 0.06. Holders of ordinary shares will be entitled to receive such dividends as may be recommended by the board of Directors of the Company and approved by the shareholders and/or such interim dividends as the board of Directors of the Company may decide. On liquidation or a winding up of the Company, the par value of the ordinary shares will be repaid out of the assets available for distribution among the holders of the Company's ordinary shares. Holders of ordinary shares have no conversion or redemption rights. On a show of hands, every holder of an ordinary share present in person or proxy at a general meeting of shareholders shall have one vote with no individual having more than one vote.

Change of control provisions in significant agreements

Certain of the Group's customer contracts allow the customer to terminate the contract in the event of a change in control of the Company.

The Group has negotiated banking facilities with a number of financial institutions, details of which are set out in note 22 to the financial statements. Certain of these facilities require repayment of the facility in the event that the Company becomes controlled by any person or persons acting in concert by whom it was not controlled at the date the facility was entered into.

Furthermore certain Group companies have entered capital grant agreements with the Irish government agency, Enterprise Ireland, whereby the Group covenants that the controlling interest in the Company will not change without Enterprise Ireland's prior written consent, which will not be unreasonably withheld.

Additionally, the Company's share option and restricted stock plans contain change in control provisions which allow potentially for the acceleration of the vesting and exercisability of outstanding options and awards of restricted stock in the event that a change in control occurs with respect to the Company. Other potential consequences for outstanding share options of a change in control following a takeover bid include the assumption of outstanding awards by the surviving company, if not ICON, or the substitution of options or restricted stock of its ordinary shares or that of its parent.

Directors' Report (continued)

Corporate Governance

Details of the Directors' compliance with corporate governance is set out separately in the Corporate Governance Report.

Significant shareholdings

In addition to the interests of Directors disclosed in the Report of the Compensation and Organisation Committee, the Company has been notified of the following shareholdings in excess of 3% of the issued share capital of the Company at 31 December 2011:

Subsidiary undertakings

The information required by the Companies Act, 1963 in relation to subsidiary undertakings is presented in note 31 to the financial statements.

The Group made no disclosable political donations in the period.

The Directors have a reasonable expectation that the Group has adequate resources to continue in operation for the foreseeable future. For this reason, the Group continues to adopt the going concern basis in preparing the financial statements.

The Directors believe that they have complied with the requirements of Section 202 of the Companies Act, 1990 with regard to books of account by employing accounting personnel with appropriate expertise and by providing adequate resources to the financial function. The books of account of the Company are maintained at the registered office.

In accordance with Section 160(2) of the Companies Act, 1963, the auditors, KPMG, Chartered Accountants, will continue in office.

On behalf of the Board

Operating and Financial Review

The following discussion and analysis should be read in conjunction with our consolidated financial statements set out on pages 41 to 126 of this report.

The Group is a contract research organisation ("CRO"), providing outsourced development services on a global basis to the pharmaceutical, biotechnology and medical device industries. The Group specialises in the strategic development, management and analysis of programmes that support Clinical Development - from compound selection to Phase I-IV clinical studies.

The Group believes that it is one of a select number of CRO's with the expertise and capability to conduct clinical trials in most major therapeutic areas on a global basis and has the operational flexibility to provide development services on a stand-alone basis or as part of an integrated "full service" solution. At 31 December 2011, the Group had approximiately 8,470 employees, in 81 locations in 40 countries. During the year ended 31 December 2011, the Group derived approximately 41.7%, 46.2 % and 12.1% of its revenue in the United States, Europe and Rest of World, respectively.

Revenue consists primarily of fees earned under contracts with third-party clients. In most cases, a portion of the contract fee is paid at the time the study or trial is started, with the balance of the contract fee generally payable in instalments over the study or trial duration, based on the achievement of certain performance targets or "milestones". Revenue from contracts is recognised on a proportional performance method based on the relationship between time incurred and the total estimated duration of the trial or on a fee-for-service basis according to the particular circumstances of the contract. As is customary in the CRO industry, the Group contracts with third party investigators in connection with clinical trials. All investigator fees and certain other costs, where reimbursed by clients, are, in accordance with industry practice, deducted from gross revenue to arrive at net revenue. As these costs vary from contract to contract, the Group views net revenue as its primary measure of revenue growth.

Direct costs consist primarily of compensation, associated fringe benefits and share based payment expense for project-related employees and other direct project driven costs. Other operating expenses consist primarily of compensation, related fringe benefits and share based payment expense for non project-related employees, recruitment expenditure, professional service costs, advertising costs and all costs related to facilities and information systems. Depreciation expense and the amortisation of intangible assets are also included within other operating expenses.

Backlog consists of potential net revenue yet to be earned from projects awarded by clients. At 31 December 2011 the Group had a backlog of approximately $2.3 billion, compared with approximately $1.9 billion at 31 December 2010. The Group believes that its backlog as of any date is not necessarily a meaningful predictor of future results, due to the potential for the cancellation or delay of projects underlying the backlog, and no assurances can be given that it will be able to realise this backlog as net revenue.

As the nature of the business involves the management of projects having a typical duration of one to four years, the commencement or completion of projects in a fiscal year can have a material impact on revenues earned with the relevant clients in such years. In addition, as the Group typically works with some, but not all, divisions of a client, fluctuations in the number and status of available projects within such divisions can also have a material impact on revenues earned from such clients from year to year.

Although the Company is domiciled in Ireland, the Group reports its results in U.S. dollars. As a consequence the results of its non-U.S. based operations, when translated into U.S. dollars, could be materially affected by fluctuations in exchange rates between the U.S. dollar and the currencies of those operations. In addition to translation exposures, the Group is also subject to transaction exposures because the currency in which contracts are priced can be different from the currencies in which costs relating to those contracts are incurred. The Group's operations in the United States are not materially exposed to such currency differences as the majority of revenues and costs are in U.S. dollars. However, outside the United States the multinational nature of the Group's activities means that contracts are usually priced in a single currency, most often U.S. dollars, Euros or pounds Sterling, while costs arise in a number of currencies, depending, among other things, on which of its offices provide staff for the contract and the location of investigator sites. Although many such contracts benefit from some degree of natural hedging due to the matching of contract revenues and costs in the same currency, where costs are incurred in currencies other than those in which contracts are priced, fluctuations in the relative value of those currencies could have a material effect on the Group's results of operations. The Group regularly reviews its currency exposures and usually negotiates currency fluctuation clauses in its contracts which allow for price negotiation if changes in the relative value of those currencies exceed predetermined tolerances.

Operating and Financial Review (continued)

As the Group conducts operations on a global basis, its effective tax rate has depended and will depend on the geographic distribution of its revenue and earnings among locations with varying tax rates. The Group's results of operations therefore may be affected by changes in the tax rates of the various jurisdictions. In particular, as the geographic mix of the Group's results of operations among various tax jurisdictions changes, its effective tax rate may vary significantly from period to period.

The following table sets forth for the periods indicated certain financial data as a percentage of net revenue and the percentage change in these items compared to the prior period, being the key performance indicators used by management. The trends illustrated in the following table may not be indicative of future results.

Year ended 31 December 2011 compared to Year ended 31 December 2010

Net revenue for the year increased by $45.7 million, or 5.1%, from $900.0 million for the year ended 31 December 2010 to $945.7 million for the year ended 31 December 2011. Net revenue in the Group's clinical research segment increased by 4.5% from $836.2 million for the year ended 31 December 2010 to $874.2 million for the year ended 31 December 2011. In the Group's central laboratory business net revenue increased by 12.1% from $63.8 million for the year ended 31 December 2010 to $71.5 million for the year ended 31 December 2011. For the year ended 31 December 2011 approximately 41.7%, 46.2% and 12.1% of the Group's net revenue was derived in the United States, Europe and Rest of World, respectively.

Operating and Financial Review (continued)

Direct costs for the year increased by $70.6 million, or 13.1%, from $541.4 million for the year ended 31 December 2010 to $612.0 million for the year ended 31 December 2011. As a percentage of net revenue, direct costs have increased from 60.1% for the year ended 31 December 2010 to 64.7% for the year ended 31 December 2011. In the Group's clinical research segment, direct costs increased by 13.9 % or $68.7 million during the year. As a percentage of net revenue direct costs in our clinical research segment have increased from 59.1% for the year ended December 31, 2010 to 64.4% for the year ended December 31, 2011. The Group has entered a number of strategic relationships with sponsors and expanded operations in certain territories. This has necessitated significant upfront investment in personnel and related infrastructure in advance of anticipated revenue flows from the business. In the Group's central laboratory business, direct costs increased by 4.2% or $2.0 million during the year. As a percentage of net revenue direct costs in our central laboratory business have decreased from 73.4% for the year ended 31 December 2010 to 68.2% for the year ended 31 December 2011, a result of restructuring activities undertaken in early 2011 together with ongoing cost management and improved resource utilisation.

Other operating expenses for the year increased by $28.1 million, or 10.5%, from $266.8million for the year ended 31 December 2010 to $294.9 million for the year ended 31 December 2011. The increase in other operating expenses for the period arose primarily from an increase in facilities and related costs of $13.7 million, an increase in personnel related expenditure of $8.1 million, including increases in recruitment expenditure and travel costs associated with non-project related employees, an increase in professional services costs of $11.1 million and an increase in depreciation and amortisation expense of $4.7 million, arising principally as a result of the increased amortisation of acquired intangibles and our continued investment in facilities and equipment to support the Group's growth. These increases were offset by the release of certain non-recurring tax related provisions of $6.0 million in both our clinical research and central laboratory business, arising from receipt of additional information in relation to these items, and a decrease in other general overhead costs of $2.0 million. Other operating expenses for the year ended 31 December 2011 also include the release of $1.7 million in respect of certain milestones pertaining to the Timaq acquisition in 2010 which were released during the year as the Group has assessed the likelihood of these milestones being achieved as remote. In the Group's clinical research segment, other operating expenses increased by $34.4 million or 14.5% during the year. This was offset by a decrease in the Group's central laboratory business, where other operating expenses decreased by $6.3 million or 21.3%. As a percentage of net revenue, other operating expenses increased from 29.6% for the year ended 31 December 2010 to 31.2% for the year ended 31 December 2011.

During the three months ended 31 March 2011, the Group commenced a review of its operations to improve resource utilisation within the business and better align resources to current and future growth opportunities of the business. This review resulted in the adoption of an initial restructuring plan, the closure of the Company's facility in Edinburgh, United Kingdom and resource rationalisations in certain of the more mature markets in which it operates. A restructuring charge of $5.0 million in respect of this plan was recognised during the three months ended 31 March 2011, $1.0 million in respect of lease termination and exit costs associated with the closure of the Edinburgh facility and $4.0 million in respect of workforce reductions. $3.5 million of costs recognised under this plan related to the clinical research segment, while $1.5 million related to our central laboratory business.

During the three months ended 30 September 2011, the Company implemented a further restructuring plan which resulted in the relocation of the Company's facility in Maryland, USA; and further resource rationalisations. A restructuring charge of $4.8 million was recognised during the three months ended 30 September 2011 in respect of this plan, $0.9 million in respect of lease termination and exit costs associated with the closure of the existing Maryland facility and $3.9 million in respect of workforce reductions. All costs recognised under this plan related to the clinical research segment.

As a result of the above, operating profit for the year decreased by $62.9 million, or 68.4%, from $91.9 million for the year ended 31 December 2010, to $29.0 million for the year ended 31 December 2011. As a percentage of net revenue, operating profit decreased from 10.2% of net revenues for the year ended 31 December 2010 to 3.1% of net revenues for the year ended 31 December 2011.

Operating and Financial Review (continued)

In our clinical research segment, operating profit for the year decreased by $73.4 million, or 70.2%, from $104.7 million for the year ended 31 December 2010 to $31.2 million for the year ended 31 December 2011. As a percentage of net revenue, operating profit decreased from 12.5% of net revenues for the year ended 31 December 2010 to 3.6% of net revenues for the year ended 31 December 2011. In our central laboratory business, operating losses for the year decreased from a loss of $12.8 million for the year ended 31 December 2010 to a loss of $2.2 million for the year ended 31 December 2011. As a percentage of net revenue operating losses decreased from 20.0% for the year ended 31 December 2010 to 3.1% for the year ended 31 December 2011.

Excluding the impact of exceptional items recognised, operating profit for the year decreased by $53.0 million or 57.7%, from $91.9 million for the year ended 31 December 2010 to $38.8 million for the year ended 31 December 2011. As a percentage of net revenue, operating profit decreased from 10.2% of net revenues for the year ended 31 December 2010 to 4.1% of net revenues for the year ended 31 December 2011. In our clinical research segment, operating profit for the year decreased by $65.2 million, or 62.3%, from $104.6 million for the year ended 31 December 2010 to $39.5 million for the year ended 31 December 2011. As a percentage of net revenue, operating profit decreased from 12.5% of net revenues for the year ended 31 December 2010 to 4.5% of net revenues for the year ended 31 December 2011. In our central laboratory business, operating losses for the year decreased by $12.1 million, from a loss of $12.8 million for the year ended 31 December 2010 to a loss of $0.7 million for the year ended 31 December 2011. As a percentage of net revenue operating losses decreased from 20.0% for the year ended 31 December 2010 to 0.9% for the year ended 31 December 2011.

Net finance expense for the year ended 31 December 2011 was $0.2 million compared with net finance income of $0.9 million for the year ended 31 December 2010. Finance income for the year decreased by $0.4 million from $2.7 million for the year ended 31 December 2010 to $2.3 million for the year ended 31 December 2011. This decrease arose predominately from an decrease in cash balances during the year. Finance expense for the year increased by $0.7 million, from $1.9 million for the year ended 31 December 2010 to $2.6 million for the year ended 31 December 2011. This increase arose predominately from a non-cash finance charge recorded in the current period in respect of the Firecrest acquisition contingent consideration.

Provision for income taxes increased from $6.6 million for the year ended 31 December 2010 to $9.6 million for the year ended 31 December 2011. During the year ended 31 December 2011 the Company recognised $2.9 million in unrecognised tax benefits for uncertain tax positions, arising from the expiration of the relevant statute of limitations in certain jurisdictions, thereby allowing for the recognition of these benefits. During the year ended 31 December 2010 the Company recognised $9.7 million in unrecognised tax benefits for uncertain tax positions, arising from both the settlement of positions with the relevant tax authorities and the expiration of the relevant statute of limitations in certain jurisdictions, resulting in the recognition of these benefits.

The Group's effective tax rate for the year ended 31 December 2011 was 33.2% compared with 7.1% for the year ended 31 December 2010. Excluding the impact of the release of uncertain tax provisions during the year ended 31 December 2011, the Group would have had an effective tax rate of 43.3% for the year ended 31 December 2011, compared to an effective tax rate of 17.5% for the year ended 31 December 2010.

Operating and Financial Review (continued)

Liquidity and capital resources

The CRO industry is generally not capital intensive. The Group's principal operating cash needs are payment of salaries, office rents, travel expenditures and payments to investigators. Investing activities primarily reflect capital expenditures for facilities, information systems enhancements, the purchase of current asset investments and acquisitions.

The Group's clinical research and development contracts are generally fixed price with some variable components and range in duration from a few weeks to several years. Revenue from contracts is generally recognised as income on the basis of the relationship between time incurred and the total estimated contract duration or on a fee-for-service basis. The cash flow from contracts typically consists of a small down payment paid at the time the contract is entered into, with the balance paid in installments over the contract's duration, in some cases on the achievement of certain milestones. Accordingly, cash receipts do not correspond to costs incurred and revenue recognised on contracts.

The Group's cash and current asset investment balances at 31 December 2011 amounted to $174.1 million compared with cash and current asset investment balances of $255.7 million at 31December 2010. The Group's cash and current asset investment balances at 31 December 2011 comprised cash and cash equivalents of $119.2 million and current asset investments of $54.9 million. The Group's cash and current asset investment balances at 31 December 2010 comprised cash and cash equivalents of $255.7 million. Working capital, comprising total current assets less total current liabilities, decreased by $70.6 million during the year from $309.7 million at 31 December 2010 to $239.1 million at 31 December 2011. This decrease arose primarily from a decrease in cash and cash equivalents as a result of the decline in profits during the period and investments made by the Group to acquire businesses and assets. Borrowings available to the Group under negotiated facilities at 31 December 2011 amounted to $150.0 million compared with $55.9 million at 31 December 2010.

On 20 July 2011, the Group entered into a three year committed multi currency revolving credit facility agreement for $150 million with Citibank, JP Morgan, Ulster Bank, Deutsche Bank and Barclays Bank. Each bank, subject to the agreement, has committed $30 million to the facility and the terms and conditions attaching to the facility are the same for each institution. The facility bears interest at LIBOR plus a margin and is secured by certain composite guarantees, indemnities and pledges in favour of the banks. This facility replaced all facilities previously in place with Bank of Ireland, AIB, Citibank and JP Morgan. On 29 February 2012, $20 million was drawn down to fund working capital requirements.

Net cash provided by operating activities amounted to $20.2 million for the year ended 31 December 2011 compared with net cash provided by operating activities of $87.4 million for the year ended 31 December 2010. The most significant influences on our operating cash flow are net income and revenue outstanding which comprises accounts receivable and unbilled revenue, less payments on account. The dollar values of these amounts and the related days revenue outstanding (i.e. revenue outstanding at the end of the period divided by the revenue for the period multiplied by the number of days in the period) can vary due to the achievement of contractual milestones, including contract signing, and the timing of cash receipts. The decrease in cash flow from operating activities during the twelve months ended 31 December 2011 arose primarily from both a decrease in net income together with an increase in the number of days revenue outstanding during the period. The number of days revenue outstanding at 31 December 2011 was 47 days compared to 37 days at 31 December 2010.

Net cash used in investing activities amounted to $152.4 million for the year ended 31 December 2011 compared to net cash provided by investing activities of $14.6 million for the year ended 31 December 2010. Net cash used in/provided by investing activities comprises primarily of capital expenditure, the purchase and sale of current asset investments and cash paid for acquisitions. Capital expenditure for the year ended 31 December 2011 amounted to $35.4 million, compared to $30.9 million for the year ended 31 December, 2010 and comprised primarily of expenditure on global infrastructure and information technology systems to support the Group's growth. During the year ended 31 December 2011 the Groups invested a net $55.6 million in current asset investments. During the year ended 31 December 2010 the Group realised a net $49.2 million from the sale of its current asset investments, which were reinvested in cash and cash equivalents.

Operating and Financial Review (continued)

Cash paid for acquisitions during the year ended 31 December 2011 amounted to $69.8 million compared to cash paid for acquisitions of $3.7 million during the year ended December 31, 2010. On 14 January 2011, the Group acquired approximately 80% of the common stock of Oxford Outcomes Limited, a leading international health outcomes consultancy business, headquartered in Oxford, United Kingdom for an initial cash consideration of 17.8 million ($27.6 million). Cash acquired on the acquisition of Oxford amount to 4.0 million ($6.2 million). Further consideration of up to 6.5 million ($10.1 million) may become payable during the period to 31 March 2012 if certain performance milestones are achieved. In July 2011 the Company paid 3.3 million ($5.1 million) in respect of the first element of this additional consideration. 3.2 million ($4.9 million) has been accrued at 31 December 2011 in respect of the remaining performance milestones. In addition, the acquisition agreement provided for certain working capital targets to be achieved by Oxford Outcomes Limited on completion. In May 2011 the Group paid an additional 3.3 million ($5.1 million) on completion of this review.

A put and call option was also agreed between the Group and the selling shareholders for the acquisition of the remaining ordinary share capital of Oxford Outcomes Limited for cash consideration of 3.8 million ($6.0 million). Further consideration of up to 1.5 million ($2.3 million) relating to this remaining common stock may become payable during the period to 31 March 2012 if certain performance milestones are achieved. On 20 October 2011, this option was exercised and 3.8 million ($6.0 million) was paid by the Group to the selling shareholders together with a further 0.7 million ($1.1 million) in respect of the first element of the performance milestones. The Group has accrued 0.8 million ($1.2 million) at 31 December 2011 in respect of the remaining performance milestones.

On 14 July 2011, the Group acquired 100% of the ordinary share capital of Firecrest Clinical Limited ("Firecrest"), a market leading provider of technology solutions that boost investigator site performance and study management, for an initial cash consideration of 17.0 million ($24.4 million). Cash acquired on the acquisition of Firecrest amounted to 1.4 million ($2.0 million). Further consideration of up to 33.0 million ($46.8 million) may become payable if certain performance milestones are achieved in the period to 30 June 2013. At 31 December 2011, the Group has accrued 31.3 million ($40.6 million) in relation to these performance milestones, 22.3 million ($28.9 million) within non-current provisions and 9.0 million ($11.7 million) within provisions. On 16 March 2012, the Group paid 3.0 million ($4.0 million) in respect of the first element of this additional consideration payable. In addition, the acquisition agreement provided for certain working capital targets to be achieved by Firecrest on completion. On 16 March 2012, the Group paid an additional 0.4 million ($0.5 million) in respect of this review.