Ambertech Limited
Annual Report 2016

Plain-text annual report

Annual Report for the year ending 30 June 2016 Ambertech Limited ACN 079 080 158 Mission Statement “ Ambertech Limited is an acknowledged leader in the identification, supply and distribution of advanced technologies for the Professional and Consumer audio/visual markets within the Oceania region. Our purpose is to add significant operational value by developing and strengthening customer relationships, expanding horizons of opportunity and delivering strong and continuous financial growth to stake holders through our proven ability to integrate, implement and commercialise existing and emerging technologies ” Contents 1. Shareholders Letter 2. Our Business and Brands 3. Media System and Professional 4. Lifestyle and Entertainment 5. New Zealand 6. Financial Report 7. Shareholder Information 8. Corporate Directory Shareholders Letter Dear Shareholders On behalf of your Board and executive management we would like to present you with your 2016 Annual Report. The 2016 financial year continued the improving trend of results for the Ambertech business. The Board and executive management team have been working hard to ensure that the long term goals of the business are achieved; by continuing to implement our strategic plan and by monitoring progress to ensure the goals are reached. The underlying results of the Ambertech business showed further improvement for the 2016 financial year, with the business recording a profit for the first time since the 2011 financial year. Despite this, the Board recognises that this result is not at an adequate level and understands the need to continue to build on this improvement in both the short and longer term. Our Lifestyle Entertainment Segment, which includes our Major Retail and Integrated Solutions teams, recorded a pleasing result, with strong performances from our key brand partners. Our Professional Segment, represented by our Media Systems and Professional groups also returned an improved contribution this year. The transformation in results is underpinned by the changes that were identified and executed as part of our strategic planning process and are key to the future success of the business. Our New Zealand group had a difficult period and returned a loss for the 2016 financial year. We have had significant changes to the operational personnel in New Zealand over that time, however we believe the business is now structured in a manner that we can return this business unit to profits in the near term. The funding that is in place for the business has moved across to Scottish Pacific Business Finance, with their acquisition of Bibby Financial Services. This facility has been extended until November 2017. This invoice discounting solution was extended to our New Zealand operation during the period and has approvals of up to $6.5M in Australia and $0.8M in New Zealand. It has provided Ambertech with greater flexibility to undertake new projects and to fund growth opportunities. This flexibility has already assisted the company in its current turnaround phase. The business was able to return greater operating cash flows this financial year. The board of Ambertech are, collectively, substantial shareholders in Ambertech and their interests continue to be aligned with the interests of all shareholders. The Board would like to thank their skilled and dedicated management team and staff for their support, and believe they will be integral in achieving the strategic objectives of Ambertech in the future. Peter Wallace Chairman Peter Amos Managing Director Our Business Media Systems The Media Systems team works with traditional television and radio broadcast industry as well as new media partners in diverse industries such as law enforcement and defence, sport, large scale events and education. From content creation and acquisition, delivery, processing and asset management, Amber Technology can offer turnkey packages for creating, delivering and managing all types of media content. Professional Products Amber’s Professional Products group has a strong reputation as a preferred supplier of high technology equipment for live sound in many different industry segments, including touring artists, live stage shows, film and television productions, broadcast news and sports, through to smaller sound installations in education facilities, houses of worship and smaller venues. Integrated Solutions The Integrated Solutions team offers cohesive systems for the custom installation and professional installation markets, with a portfolio of high end audio visual and infrastructure brands for residential and commercial installation projects. Customers typically engage the services of a professional installer for a full ‘turnkey’ solution. Major Retail The Major Retail division works with home electronics retailers nationally, mass markets retail chains and independent specialist outlets to supply home entertainment solutions for consumers in the residential market. Our focus is on offering a comprehensive selection of high end audio visual and accessory brands for end users. Our Brands Accent Audio Accent Visual Cordial Coloud Mars Antennas Revolution Acoustics MicroVideo Solid State Logic Accent Acoustics Digital Projection Molami Acoustic Research DPA Microphones MP Antennas Sonance Sonarray Dynaudio Professional Navitar Silvus Technology Advanced Network Telemetry Ambertec Apart AudioQuest Avid AVI WEST Analysis Plus David Horn Communications EVS Energizer GB Labs Gefen Haivision Alpermann+Velte Hercules Axle Video BATS Wireless BeeWi Blue Lucy iPort Integra Interra Systems Jet City Amplification Blue Microphones Knoll Launchport Lenco Liberty Lumens LunaStone Litepanels BrightEye Brainstorm Canare Cleerline Contacta CP Cases C6 Cioks Net Mix Nexidia Neutrik NHT Niveo Professional NL Technology NTI NuVo Nugen Audio One For All Optoma Onkyo Opticomm Emcore Premier Mounts Panasonic Primacoustic Proel Progressive Laboratories SAM Snell Advanced Media Tannoy Tecxus Teradek TC Electronic TC Helicon Telestream TrickleStar Troll Systems Trilogy Urbanears Van Damme Videssence Vinten Vinten Ramadec Vue Audiotechnik Well Av Xen Data Middle Atlantic Peak Antennas Marshall Headphones Rean Cool Components Michell Engineering Radial Engineering Media Systems and Professional The focus for this Group has been on core brand development and the exploration of new market segment opportunities. Our long-standing experience in the fields of professional broadcast and enterprise audio and video systems has meant that Amber Technology has much to offer in today’s increasingly efficiency-minded networked defence and emergency services segments. Working either in conjunction with prime contractors or as a stand-alone resource, we provide solutions to complex problems in the delivery of voice, video and data that are out-of-the-box in normal defence thinking, but well established in the professional broadcast field. Content creation and delivery in new media channels has created new emerging markets in non-traditional media sectors, as in-house production facilities become the norm for many businesses. In addition to defence-specific products, the full range of microphones, cables, connectors, projectors, antennas as well as enterprise video recording, storage, processing, management and distribution products (IPTV) has resulted in media production projects for education, houses of worship and corporate enterprises. Media Systems brand acquisitions, including Silvus, BATS, Mars Antennas, Brainstorm and Haivision, served to strengthen Group’s portfolio offering as an end-to-end solutions provider. The year’s result was enhanced with strong performance in the supply of cable and connectors to the many large scale projects underway in Australia – projects such as the International Convention Centre (ICC) Darling Harbour required the latest standards in ethernet and fibre infrastructure, which we were able to deliver. The education sector is continuing to upgrade teaching facilities for the media studies and music technology courses they deliver. The Solid State Logic model Duality mixing console was chosen for the upgrade to Hunter TAFE Newcastle when they built a world class music recording facility. Our manufacturers continue to provide innovative products for the musical instrument and professional resellers in our network. Brands such as TC Electronic, DPA Microphones, Radial Engineering, Solid State Logic and Dynaudio Professional continue to gain market share and become the industry standard. One of our key agencies, Snell Advanced Media, has recently been the subject of substantial reorganisation, and has introduced a number of key products that have excellent potential. This has been identified early with sales of vision switchers to both TVNZ in New Zealand and Sky News. Major projects completed • • • • • Solid State Logic installation Hunter TAFE Newcastle Installation of a major integrated Avid/EVS News solution at Fox Sports emphasised Amber’s very strong capabilities in the Enterprise Integra replaces Yamaha AV Receivers in the Australian Film Television and Radio School SAM Vision Switchers to both TVNZ in New Zealand and Sky News EVS Upgrades for NEP HD OB Trucks FOR THE LOVE OF TONE Introducing LunaStone TrueOverDrive™ The Three Stage Rocket is the result of a collaboration with the Danish guitarist, Søren Andersen, who wanted a pedal that delivered the tone he was hearing in his head, but had never truly found in a stompbox. Digging classic overdrive with a cutting and mid-focused crunch? Then you need to take the Wise Guy out for a spin. Expect the transparency and sweet responsiveness you know and love from great vintage amps. The Big Fella is your one stop station to an intense and modern rock tone. The tone of this hard-hitting drive gem will fill the room with a massive overdrive that is super fat, yet with a firm low end and tons of sustain. Available Through All Good MI Retailers or Visit www.lunastonepedals.com/dealers Proudly Distributed in Australia by Amber Technology www.ambertech.com.au | 1800 251 367 | sales@ambertech.com.au Distributed in Australia by Amber Technology |www.ambertech.com.au |1800 251 367 |sale@ambertech.com.au V A M R OICIN G B TIN KID Y D! THE ALL NEW CUSTOM 22 TUBE HEAD Built on our 20 watt platform, with updated voicing by British amp guru Martin Kidd. The updated Crunch channel has less gain than its predecessor and the Overdrive has even more gain! The result is an entirely new voice with greater range and touch-sensitivity. Further tone shaping is possible via a bright switch and mid-boost / low fat switch. TECH SPECS Channels: Crunch & Overdrive 20 watts into 16 ohm Tubes: 5 x 12AX7 Pre / 2 x EL84 Power Effects Loop Footswitch included TO FIND YOUR NEAREST AUTHORISED JET CITY RETAILER GO TO INFO.AMBERTECH.COM.AU/JET-CITY-DEALERS Avid NEXIS™ Customised Media Storage in 5 Simple Steps Avid NEXIS enables true storage virtualisation for any media application and can adapt to the ever-changing needs of an unpredictable production world. Design a system customised to your unique storage requirements using the world’s first software-defined storage. 1 Select your Media Packs 2 Select your Storage Engine 3 Select options like Redundant Controllers 4 Select more options like System Director 5 Add your editing client (e.g. FCP, Adobe, Media Composer) Amber Technology – Australia’s largest Avid Elite Solutions Partner. www.ambertech.com.au broadcast@ambertech.com.au SOURCE SUPPLY SUPPORT Lifestyle Entertainment During the 2015-16 financial year, the Lifestyle Entertainment division focused on four significant objectives: • • • Consolidating its position as a leading supplier to the residential AV installation industry Revitalising relationships with residential AV retailers Increasing competitiveness and participation in the commercial AV installation segment • Maintaining a strong position in the supply of consumer electronics hardware to major retailers. We experienced favourable outcomes in all of these focus areas. During the year, changes in senior management of the division (through natural attrition) have brought renewed energy and focus to our efforts. Key appointments to the roles of General Manager and National Sales Manager (Specialist Residential Markets) have added directly relevant industry experience and depth to our team. The AV hardware markets (both residential and commercial) experienced a great deal of change in the year just ended, with significant movement of brands, consolidation of manufacturers and changes in the distribution landscape. The Lifestyle Entertainment division has carefully observed these changes and sought to continuously review and refine the brand portfolio in order to maximise the completeness of offer while increasing the focus on significant brand partnerships. During the year, discussions with a number of new brands commenced. This resulted in the creation of new brand relationships that will bear fruit during the 2016-17 financial year: • • • Apart Audio: a Belgian manufacturer of audio hardware for small to medium sized projects, Apart Audio’s products are recognised by commercial AV installers for their quality and value. Contacta Systems: based in England, Contacta manufactures hearing loop and speech transfer systems. Contacta’s hearing loop products can be applied in both residential and commercial applications, while the speech transfer systems can be used whenever security glass prevents easy conversation between customers and service staff (for example, in railway stations and banks). JTS Professional: JTS, headquartered in Taiwan, manufactures an extensive range of wired and wireless microphones, conference systems and portable PA systems. We will distribute these to our professional, music shop, major retail and commercial AV customers. Our brands have featured in a number of public spheres during the year, including: • • • • National tour of the ‘Miss Fisher’s Murder Mystery’ exhibition (Optoma projectors) The award winning ‘A Garden Called Frank’ at the Melbourne International Flower and Garden Show (Sonance Landscape Series outdoor speakers and amplifiers) ‘Sound Cells’ installation as part of the Vivid Festival in Sydney (Optoma projectors) Development with brand partners of Onkyo/Dolby Atmos fixtures for live demonstration and education of consumers in selected retail outlets, highlighting the benefits of quality audio in the home environment, rolling out in the new financial year I n t e g r a t e 2 0 1 6 P r e v i e w e d a t S S E T E CHNOLOGY L - P M 0 WITH L A 5 6 U Z A M O T P O E H T G N I C U D O R T IN *W hite m odel shown subject to availability N e w t o t h e O p t o m a r a n g e i s t h e l a m p - l e s s Z U 6 5 0 W U X G A p r o j e c t o r f e a t u r i n g L a s e r- p h o s p h o r t e c h n o l o g y , d e l N o l a m p a n d fi l t e r r e p l a c e m e n t , l o w e r i n g t h e t o t a l c o s t o f o w n e r s h i p l t y p e s o f c o m m e r c i a l i n s t a l O u t p u t s a n a s t o n i s h i n g 6 0 0 0 L u m e n s o f b r i g h t n e s s a n d g r e a t c o l o u r l t i n H D B a s e T c o n n e c t i v i t y F i v e m o t o r i s e d l e n s o p t i o n s l a b l e n o w t h r o u g h w w w. a m b e r t e c h . c o m . a u 1 8 0 0 2 5 1 3 6 7 s a l e s @ a m b e r t e c h . c o m . a u V i s i t I n t e g r a t e S t a n d A 0 2 5 f o r a d e m o n s t r a t i o n i v e r i n g g r e a t fl e x i b i • • • • l a t i o n s . i t y f o r A v a i B u i a l l S O U R C E S U P P LY S U P P O R T I n t r o d u c i n g S o n a n c e P r o f e s s i o n a l S e r i e s l w a n t t o c h e c k o u t t h e i t y a n d a e s t h e t i c s f o r t h e c a t e g o r y . s e t a n e w b e n c h m a r k i n s o u n d q u a l I f y o u d o c o m m e r c i a l p r o j e c t s , t h e n y o u w i l - n e w S o n a n c e P r o f e s s i o n a l S e r i e s – a r a n g e o f 7 0 V / 1 0 0 V / 8 o h m s e l e c t a b l e I n - C e i l i n g , P e n d a n t a n d S u r f a c e M o u n t S p e a k e r s t h a t A s p r e v i e w e d a t I n t e g r a t e t h e S o n a n c e P r o f e s s i o n a l S e r i e s i s l a b l e i n 4 ” , 5 . 2 5 ” ( S u r f a c e M o u n t o n l y ) , 6 . 5 ” , 8 ” 2 - w a y a n d 8 ” W o o f e r s , a n d s h a r e s c o n s i s t e n t v o i c i n g t o e n s u r e s e a m l e s s s o n i c i n t e g r a t i o n w h e n u s e d t o g e t h e r t h r o u g h o u t a s p a c e . N o w c o m m e r c i a l p r o j e c t s c a n e n j o y t h e s a m e c l e a n , m i n i m a l i s t i c d e s i g n a n d u n c o m p r o m i s e d s o n i c p e r f o r m a n c e t h a t S o n a n c e i s a v a i a l l r e n o w n e d f o r . T a l k t o t h e t e a m a t A m b e r Te c h n o l o g y t o fi n d o u t m o r e : w w w. a m b e r t e c h . c o m . a u 1 8 0 0 2 5 1 3 6 7 s a l e s @ a m b e r t e c h . c o m . a u S O U R C E S U P P LY S U P P O R T New Zealand The New Zealand business had a mixture of results across its divisions for the 2015/16 financial year. In many areas we have had positive growth which is reflective of the hard work by New Zealand staff in the very competitive market we operate in. Key highlights for the year included: • Harvey Norman, JB Hi Fi and Noel Leeming launched a comprehensive range of One For All remote controls into all stores nationwide Distributed in Australia by Amber Technology |www.ambertech.com.au |1800 251 367 |sale@ambertech.com.au • Marshall Speakers were introduced into multiple channels and showed significant growth against the major players in this very crowded market • With many overseas studios now seeing New Zealand as a main hub for movie production, we have experienced increased uptake of Canare microphone cable and Neutrik OpticalCON connectors, used in multiple movie sets • • HP workstations were used in the upgrade for Mediaworks network Accent Cable was introduced to the Electrical Wholesale market with all of the four main national chains now ranging the brand We are looking forward to capitalising on the ground work that has been laid this year and moving the Amber New Zealand business forward. V A M R OICIN G B TIN KID Y D! THE ALL NEW CUSTOM 22 TUBE HEAD Built on our 20 watt platform, with updated voicing by British amp guru Martin Kidd. The updated Crunch channel has less gain than its predecessor and the Overdrive has even more gain! The result is an entirely new voice with greater range and touch-sensitivity. Further tone shaping is possible via a bright switch and mid-boost / low fat switch. TECH SPECS Channels: Crunch & Overdrive 20 watts into 16 ohm Tubes: 5 x 12AX7 Pre / 2 x EL84 Power Effects Loop Footswitch included TO FIND YOUR NEAREST AUTHORISED JET CITY RETAILER GO TO INFO.AMBERTECH.COM.AU/JET-CITY-DEALERS AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2016 AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT The directors present their report together with the financial statements of the consolidated entity consisting of Ambertech  Limited and its controlled entites, ("company" or "economic entity") for the year ended 30 June 2016 and the auditor's report  thereon. DIRECTORS The qualifications, experience and special responsibilities of each person who has been a director of the Company at any time  during or since the end of the financial year are listed below, together with the details of the company secretary as at the end  of the financial year.  All directors were in office during the whole of the financial year and up to the date of this report unless  otherwise stated. Information on directors Peter Francis Wallace Chairman ‐ Non Executive Director Member of the Audit and Risk Management Committee and Chairman of the Remuneration and Nomination Committee. Peter Wallace is the founder and Managing Director of Endeavour Capital Pty Limited, an independent corporate advisory  firm.  Prior to establishing Endeavour Capital Pty Limited in 1998, he was an Investment Director with private equity  company Hambro‐Grantham. Mr Wallace has been a non‐executive director of over 20 groups of companies. Mr Wallace has a Bachelor of Commerce degree from the University of New South Wales and a Master of Business  Administration degree from Macquarie University. He is a member of the Institute of Chartered Accountants, and a fellow of  the Australian Institute of Company Directors. Mr Wallace has been a director of Ambertech’s Group companies since February 2000 and Chairman of Ambertech Limited  since October 2002. Peter Andrew Amos Managing Director Peter Amos graduated from Sydney Technical College (now University of Technology, Sydney) with a Radio Trade Certificate  and from North Sydney Technical College with an Electronics Engineering Certificate. He joined Rank Electronics, the  Company from which Ambertech was formed via a management buyout, as a technician in the mid 1970s, rising from Senior  Technician to Service Manager. Upon the formation of Ambertech Limited, Mr Amos became Technical Director of the  Ambertech Group. He also served in a senior role as Marketing Director of Quantum Pacific Pty Ltd, another company owned  by Ambertech Limited, until it was sold in the mid 1990s. Mr Amos has served as Managing Director of Ambertech Limited since 1995 and presided over the growth of the Company  since that date.  Mr Amos has been a director of Ambertech’s Group companies since 1987. Thomas Robert Amos Non‐Executive Director Tom Amos founded telecommunications consultancy Amos Aked Pty Limited in the early 1980s. His career in  telecommunications and media spans over 30 years, during which time he has been involved in all facets of the industry. An  engineer by profession, Mr Amos holds a B.E. (Electrical Engineering) degree from Sydney University.  Mr Amos has also been prominent in the telecommunication deregulation debate over a period of 15 years as a (former)  director and Vice Chairman of Australian Telecommunications Users Group Limited (“ATUG”) and as an industry  commentator. He is a director of Wave Link Systems Pty Limited and Amos Aked Swift (NZ) Limited. Mr Amos has been a director of Ambertech’s Group companies since June 1997. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT Edwin Francis Goodwin Non‐Executive Director Chairman of the Audit and Risk Management Committee Ed Goodwin holds a BSc in economics from London University and an MBA from Sydney University.   In recent years he has  been working in new venture finance, following 25 years in senior finance and business development roles primarily in the  telecommunications industry. Mr Goodwin has been a director of Ambertech’s Group companies since June 1997. David Rostil Swift Non‐Executive Director Member of the Remuneration and Nomination Committee. David Swift, who holds a B.E. (Electrical Engineering) degree from the University of NSW, has extensive experience in both  the telecommunications and professional electronics industries.  Mr Swift, a co‐founder of Amos Aked Swift Pty Ltd and the  founder of AAS Consulting Pty Ltd, is currently an independent telecommunications management and technology  consultant operating in the Australasian Pacific region. Mr Swift is also a Director and the Chairman of the Australian Telecommunications Users Group Limited (ATUG) and a  Director of Amos Aked Swift (NZ) Limited. In addition to his consulting experience he has had significant management  experience through senior positions with both Westpac Banking Corporation and Telecom Australia. Mr Swift has been a  director of Ambertech's Group companies since June 1997. Company Secretary and Chief Operating Officer The following person held the position of Company Secretary at the end of the financial year:  Robert John Glasson Robert Glasson joined Ambertech Limited on 1 July 2002 and also holds the position of Chief Operating Officer.  He  previously held the position of Chief Financial Officer up until 30 June 2015.  He has a Bachelor of Business degree from the  University of Technology, Sydney, and is a member of Chartered Accountants Australia and New Zealand.  He was  appointed to the role of Company Secretary on 1 November 2004. CORPORATE INFORMATION Nature of operations and principal activities The principal activities of the economic entity during the financial year were the import and distribution of high technology  equipment to the professional broadcast, film, recording and sound reinforcement industries; the import and distribution of  home theatre products to dealers; distribution and supply of custom installation components for home theatre and  commercial installations to dealers and consumers, and the distribution of projection and display products with business  and domestic applications. There have been no significant changes in the nature of these activities since the end of the financial year. Employees The economic entity employed 94 employees as at 30 June 2016 (2015: 89 employees). AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT REVIEW AND RESULTS OF OPERATIONS The consolidated profit of the economic entity before providing for income tax for the financial year was $236,000.  This was improved from a loss before tax of $419,000 in the previous period. Total revenues for the financial year  increased by 9% to $54,681,000 (2015: $50,157,000).  Further information on the operations is included in the  Chairman's and Managing Director's Report section of the Annual Report, and in the ASX Appendix 4E. FINANCIAL POSITION The directors believe the economic entity is in a reasonably strong and stable financial position with the potential to  expand and grow its current operations. The economic entity recorded positive operating cash flows of $719,000  (2015: $367,000)  for the year ended 30 June 2016.  Whilst borrowings were decreased by $1,185,000 during the  financial year, the economic entity maintained a healthy working capital ratio. The economic entity's working capital, being current assets less current liabilities, has increased by $410,000 to  $8,726,000 as at 30 June 2016 (2015: $8,316,000).  The net assets of the economic entity have also increased by  $301,000 to $10,840,000 as at 30 June 2016 (2015: $10,539,000).  SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS There were no significant changes in the state of affairs of the economic entity during the financial year. EVENTS SUBSEQUENT TO REPORTING DATE Subsequent to year end, the economic entity secured a $4.08M forward exchange contract facility with American  Express FX International Payments. The facility will be used for payment of foreign currency payables and to assist in  managing the economic entity's foreign currency risk. There were no other matters that have arisen since the end of  the financial year that have significantly affected, or may significantly affect the operations or state of affairs of the  economic entity in future financial years. FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES The 2016‐17 financial year has begun well, and as a result the Board of Ambertech Limited ("the Board") is cautiously  optimistic that it can deliver on business strategies, which continue to focus on returning positive results for investors  in the short term. At this early stage the Board is unable to provide guidance on potential results with any certainty;  however expects to be able to update investors by the time of holding the company's AGM.  The board and management remain focused on utilising the traditional strengths of the Ambertech business as a  technical distributor to bring new products and brands to market and to redefine the methods and channels in which  the business operates. We are continuing to progress these initiatives which are the key drivers of future revenue and  profit growth. ENVIRONMENTAL REGULATION The company is subject to regulation by the relevant Commonwealth and State legislation.  The nature of the  company's business does not give rise to any significant environmental issues. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT REMUNERATION REPORT (AUDITED) The information provided below includes remuneration disclosures that are required under the Corporations Act 2001 and its  regulations.  The disclosures contained within the remuneration report have been audited. In recent years the remuneration policy of the company has had to take into account competing interests.  On one hand,  shareholder returns are inadequate, while Directors, faced with their responsibilities to the Company, need to retain an  experienced, expert Board and executive management team.  Directors are aware that these staff may have opportunities to  pursue their careers in less challenging environments with prospects of greater remuneration. Consistent with this view, there have been no significant changes to the remuneration strategy employed by the Board for  the 2016 financial year.  There has been no change in the remuneration of non‐executive directors since 1 January 2010. Remuneration Strategy Non‐Executive Director Remuneration Remuneration of non‐executive directors is determined by the Remuneration and Nomination Committee.  In determining  payments to non‐executive directors, consideration is given to market rates for comparable companies for time,  commitment and responsibilities.  The Remuneration and Nomination Committee reviews the remuneration of non‐ executive directors annually, based on market practice, duties and accountability. Remuneration of non‐executive directors comprises fees determined having regard to industry practice and the need to  obtain appropriately qualified independent persons.  Fees do not contain any non‐monetary elements.  In response to the  financial performance of the company the remuneration of non‐executive directors has remained unchanged since 1 January  2010. Executive Remuneration Managing Director and Chief Operating Officer Remuneration of the Managing Director and the Chief Operating Officer (COO) is determined by the Remuneration and  Nomination Committee.  In this respect, consideration is given to normal commercial rates of remuneration for similar levels  of responsibility.  Remuneration comprises salaries, bonuses, contributions to superannuation funds and options. The Managing Director and COO receive an incentive element of their salary which is based on achievement of Key  Performance Indicators (KPIs) relevant to their responsibilities.  This includes a component that is based on the company's  profit targets.  The total incentive amounts payable are capped at a fixed rate rather than as a percentage of total  remuneration, however if paid on target these incentives would have represented approximately 20% of total salary for the  Managing Director and 15% of total salary for the COO. KPIs are set annually by the Remuneration and Nomination Committee and based on company performance targets, and  vary according to the roles and responsibilities of the executive.  At the same time, these KPIs are aligned to reflect the  common corporate goals such as growth in earnings and shareholders' wealth, and achievement of working capital targets.   Performance against the KPIs is assessed annually by the Remuneration and Nomination Committee and recommendations  for payments determined following the end of the financial year. As a result of the financial performance of the company, the Managing Director and COO have foregone the entirety of their  short term incentive and KPI salary components for the past six financial years. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT REMUNERATION REPORT (continued) Other Executives Remuneration of other key executives is set by the Managing Director and Chief Operating Officer, with reference to  guidelines set by the Remuneration and Nomination Committee.   In this respect, consideration is given to normal  commercial rates of remuneration for similar levels of responsibility.  Remuneration comprises salaries, bonuses,  contributions to superannuation funds and options. Approximately 5% of the aggregate remuneration of the senior sales executives comprises an incentive element  which is related to the KPIs of those parts of the company's operations which are relevant to the executive's  responsibilities. The senior sales executives may also receive a sales commission component, which will vary with the  sales performance of those parts of the sales business for which they are responsible. KPIs are set annually by the Remuneration and Nomination Committee, with a degree of consultation with executives  to ensure their commitment. The measures are tailored to the areas of each executive's involvement and over which  they have control. They are based on company performance targets, and at the same time, these KPIs are aligned to  reflect the common corporate goals such as growth in earnings and shareholders' wealth, and achievement of  working capital targets. Performance against the KPIs is assessed annually by the Remuneration and Nomination  Committee and recommendations for payments determined following the end of the financial year. The table below sets out the economic entity's key shareholder indicators for the past 5 financial  years: Dividends paid (cents per share) 2016 ‐ 2015 ‐ Closing share price at 30 June ($) $0.125 $0.135 2014 ‐ $0.20 2013 ‐ $0.23 2012 ‐ $0.24 Net profit/(loss) after tax ($'000) 237 (1,654) (1,000) (2,212) (4,693) Details of Remuneration Details of the remuneration of the directors and the key management personnel (as defined in AASB 124 Related  Party Disclosures) of the economic entity are set out in the following tables. The key management personnel of the economic entity includes the following: Name Position Name Position P Wallace Non‐Executive Chairman R Glasson Group COO, Company Secretary P Amos Group Managing Director P Simmons T Amos Non‐Executive Director R Neale E Goodwin Non‐Executive Director D Swift Non‐Executive Director R Caston R McCleery N Lee General Manager, Lifestyle Entertainment Resigned: 13/11/2015 General Manager, Lifestyle Entertainment Commenced: 23/11/2015 General Manager, Broadcast & Professional Managing Director, Amber New Zealand Resigned: 31/03/2016 General Manager, Amber New Zealand Commenced: 01/04/2016 Key management personnel are those directly accountable to the Managing Director and the Board and responsible  for the operational management and strategic direction of the Company. The nature and amount of each major element of the remuneration of each director of the economic entity and each  of the key management personnel of the parent and the economic entity for the financial year are set out in the  following tables.                                                                                                                                                                             AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT REMUNERATION REPORT (continued) Elements of Remuneration 2016 Directors P Amos P Wallace T Amos E Goodwin D Swift Executives R Glasson R Caston P Simmons ‐ Resigned 13/11/15 R Neale ‐ Commenced 23/11/15 R McCleery ‐ Resigned 31/3/16 N Lee ‐ Commenced 1/4/16 Short‐term employment  benefits Post  employment  benefits Long‐term employment benefits Salary fees  and leave $ Cash Bonus Superannuation $ $ LSL accrued/ (taken) $ 345,155 55,046 32,111 32,111 105 464,528 191,833 152,653 108,857 126,704 107,869 25,789 713,705 ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 1,250 4,566 ‐ ‐ 5,816 34,015 5,233 3,053 3,053 35,000 80,354 18,315 31,923 10,393 21,509 ‐ 1,467 83,607 Total $ 386,095 60,279 35,164 35,164 35,105 551,807 213,877 171,329 120,500 152,928 107,869 27,256 %  Performance Related 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 1.0% 3.0% 0.0% 0.0% 0.7% (9,369) 793,759 (1) On 13 November 2015, a cash bonus of $1,250 was paid to Mr Simmons relating to performance against KPI's.  The bonus is 100% of the total available to  Mr Simmons under his KPI scheme. (2) On 14 April 2016, a cash bonus of $4,566 was paid to Mr Neale relating to performance against KPI's.  The bonus is 100% of the total available to Mr Neale under his KPI scheme. 2015 Directors P Amos P Wallace T Amos E Goodwin D Swift Executives R Glasson R Caston P Simmons R McCleery Short‐term employment  benefits Post  employment  benefits Long‐term employment benefits Salary fees  and leave $ Cash Bonus Superannuation $ $ LSL accrued/ (taken) $ 360,979 55,046 32,111 32,111 90 480,337 196,484 142,398 163,039 123,403 625,324 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 5,000 10,000 ‐ 15,000 33,991 5,229 3,051 3,051 34,990 80,312 18,303 35,089 22,021 ‐ 75,413 Total $ 401,885 60,275 35,162 35,162 35,080 567,564 177,429 187,229 200,122 123,403 %  Performance Related 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 2.7% 5.0% 0.0% 2.2% (27,554) 688,183 6,925 ‐ ‐ ‐ ‐ 6,925 3,729 (13,247) ‐ 149 ‐ ‐ 6,915 ‐ ‐ ‐ ‐ 6,915 (37,358) 4,742 5,062 ‐ (1) On 12 June 2015, a cash bonus of $5,000 was paid to Mr Caston relating to performance against KPI's.  The bonus is 100% of the total available to Mr Caston under his KPI scheme. (2) On 14 August 2014, a cash bonus of $5,000 was paid to Mr Simmons relating to performance against 2013‐14 KPI's.  The bonus is 100% of the total available to Mr Simmons under his KPI scheme. On 12 June 2015, a cash bonus of $5,000 was paid to Mr Simmons relating to performance against 2014‐15  KPI's.  The bonus is 100% of the total available to Mr Simmons under his KPI scheme.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT REMUNERATION REPORT (continued) Service agreements An executive agreement exists between Peter Amos, the Managing Director, and Amber Technology Limited. This agreement provides  that Mr Amos, for a period of 12 months from the date of termination, will not engage in activities in competition with the Amber  Group.  There is a notice period by either party of 12 months. The agreement commenced on 31 May 1999 and continues indefinitely. In the event that the company was to exercise its right to  terminate the contract, the current payout value would be $380,000 (2015: $380,000). Share based compensation The company has adopted an Employee Share Option Plan (ESOP). The Board of Directors may determine the executives and eligible  employees who are entitled to participate in the ESOP. The options issued under the ESOP will expire 5 years after the issue date, or earlier on any of the following events: a the eligible employee is dismissed with cause or has breached a restriction contained in his/her employment contract; b c d e the eligible employee dies while in the employ of the Company; the eligible employee is made redundant by the Company; the eligible employee’s employment with the Company is voluntarily terminated by the eligible employee; or the eligible employee’s employment terminates by reason of normal retirement. The total number of shares reserved for issuance under the ESOP, together with shares reserved for issuance under any other Option  Plan, shall not exceed 5% of the diluted ordinary share capital in the Company (comprising all Shares, all Options issued under the  ESOP and under any other Option Plan, and all other convertible issued securities). The ESOP provides the Board with the ability to determine the exercise price of the options, the periods within which the options may  be exercised, and the conditions to be satisfied before the option can be exercised. The ESOP provides for adjustments in accordance with ASX Listing Rules if there is a capital reconstruction, a rights issue or a bonus  issue.  There were no options on issue to directors and key executives at the date of this report. There were no options issued during or since  the end of the financial year. There have been no shares issued during or since the end of the financial year as a result of exercise of options. In relation to bonus issues, each outstanding option confers on the option holder the right to receive, on exercise of those outstanding  options, not only one share for each of the outstanding options exercised but also the additional shares the option holder would have  received had the option holder participated in that bonus issue as a holder of ordinary shares. The assessed fair value at offer date is determined using a Black‐Scholes option pricing model that takes into account the exercise  price, the term of the option,the impact of dilution, the share price at offer date and expected price volatility of the underlying share,  the expected dividend yield and the risk free interest rate for the term of the option. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT Interests of Directors At the date of this report the following interests were held by directors: Director P Wallace P Amos T Amos E Goodwin D Swift DIVIDENDS Ordinary Shares 2016 2015 236,528 4,313,843 5,484,625 2,883,556 2,995,826 236,528 4,313,843 5,484,625 2,883,556 2,995,826 There were no dividends paid or declared by the Company to members since the end of the previous financial year. DIRECTORS' MEETINGS The number of directors' meetings (including meetings of committees of directors) and the number of meetings attended by  each of the directors of the Company during the financial year are: Director P Wallace P Amos T Amos E Goodwin D Swift Board Meetings Attended 9 9 9 8 9 Held 9 9 9 9 9 Audit and Risk Management  Committee Meetings Held 3 Attended 3  ‐  ‐ 3  ‐  ‐  ‐ 3  ‐ Nomination and Remuneration  Committee Attended 2  ‐  ‐  ‐ 2 Held 2  ‐  ‐  ‐ 2                                                                                                                         AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT NON‐AUDIT SERVICES It is the  economic entity's policy to employ BDO East Coast Partnership (BDO) for assignments additional to their  annual audit duties, when BDO's expertise and experience with the economic entity are important. During the year  these assignments comprised primarily tax compliance assignments.  The Board of Directors is satisfied that the  auditors' independence is not compromised as a result of providing these services because:  ‐  ‐ All non‐audit services have been reviewed by the Audit and Risk Management Committee to ensure they do not  impact the impartiality and objectivity of the auditor, and None of the services undermines the general principles relating to the auditor independence as set out in APES 110  Code of Ethics for Professional Accountants, including reviewing or auditing the auditors' own work, acting in a  management or decision making capacity for the company, acting as an advocate for the company or jointly  sharing economic risks and rewards. During the year fees that were paid or payable for services provided by the auditor of the parent entity  and its related practices are disclosed at note 27. The directors are satisfied that the provision of non‐audit services during the year by the auditor is compatible with the  general standard of independence for auditors imposed by the Corporations Act 2001. PROCEEDINGS ON BEHALF OF THE COMPANY No person has applied to the Court under section 237 of the Corporations Act 2001 for leave to bring proceedings on  behalf of the company, or to intervene in any proceedings to which the company is a party, for the purpose of taking  responsibility on behalf of the company for all or part of those proceedings. No proceedings have been brought or intervened in on behalf of the company with leave of the Court under section 237  of the Corporations Act 2001. AUDITORS' INDEPENDENCE DECLARATION A copy of the auditors' independence declaration as required under section 307C of the Corporations Act 2001 is set out  on page 11. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' REPORT INDEMNIFICATION OF OFFICERS The company has indemnified the directors and executives of the company for costs incurred, in their capacity as a  director or executive, for which they may be held personally liable, except where there is a lack of good faith. During the financial year, the company paid a premium in respect of a contract to insure the directors and executives  of the company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance  prohibits disclosure of the nature of liability and the amount of the premium. ROUNDING The company is an entity to which Class Order 98/100 applies and, in accordance with this class order, amounts in this report and the financial statements have been rounded off to the nearest thousand dollars unless otherwise indicated. Signed in accordance with a resolution of directors. Director: P F Wallace P A Amos Dated this 23rd day of September 2016. Sydney Tel: +61 2 9251 4100 Fax: +61 2 9240 9821 www.bdo.com.au Level 11, 1 Margaret St Sydney NSW 2000 Australia DECLARATION OF INDEPENDENCE BY PAUL BULL TO THE DIRECTORS OF AMBERTECH LIMITED As lead auditor of Ambertech Limited for the year ended 30 June 2016, I declare that, to the best of my knowledge and belief, there have been: 1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and 2. No contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Ambertech Limited and the entities it controlled during the period. Paul Bull Partner BDO East Coast Partnership Sydney, 23 September 2016 BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees. Tel: +61 2 9251 4100 Fax: +61 2 9240 9821 www.bdo.com.au Level 11, 1 Margaret St Sydney NSW 2000 Australia INDEPENDENT AUDITOR’S REPORT To the members of Ambertech Limited Report on the Financial Report We have audited the accompanying financial report of Ambertech Limited, which comprises the consolidated statement of financial position as at 30 June 2016, the consolidated statement of profit or loss and other comprehensive income, the consolidated statement of changes in equity and the consolidated statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors’ declaration of the consolidated entity comprising the company and the entities it controlled at the year’s end or from time to time during the financial year. Directors’ Responsibility for the Financial Report The directors of the company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In Note 2(a), the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements comply with International Financial Reporting Standards. Auditor’s Responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company’s preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. BDO East Coast Partnership ABN 83 236 985 726 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO East Coast Partnership and BDO Australia Ltd are members of BDO International Ltd, a UK company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation, other than for the acts or omissions of financial services licensees. Independence In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the directors of Ambertech Limited, would be in the same terms if given to the directors as at the time of this auditor’s report. Opinion In our opinion: (a) the financial report of Ambertech Limited is in accordance with the Corporations Act 2001, including: (i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of its performance for the year ended on that date; and (ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and (b) the financial report also complies with International Financial Reporting Standards as disclosed in Note 2(a). Report on the Remuneration Report We have audited the Remuneration Report included in pages 5 to 8 of the directors’ report for the year ended 30 June 2016. The directors of the company are responsible for the preparation and presentation of the Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards. Opinion In our opinion, the Remuneration Report of Ambertech Limited for the year ended 30 June 2016 complies with section 300A of the Corporations Act 2001. BDO East Coast Partnership Paul Bull Partner Sydney, 23 September 2016 AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME  FOR THE YEAR ENDED 30 JUNE 2016 Revenue Cost of sales Gross profit Other income Employee benefits expense Distribution costs Marketing costs Premises costs Depreciation and amortisation expenses Finance costs Travel costs Other expenses Profit/(loss) before income tax Income tax benefit/(expense) Profit/(loss) for the year Other comprehensive income Items that may be reclassified subsequently to profit or loss: Exchange differences on translation of foreign operations Other comprehensive income for the year, net of tax Total comprehensive income for the year Earnings per share Basic earnings per share (cents) Diluted earnings per share (cents) Economic Entity Note 2016 $'000 2015 $'000 3 4 3 4 4 4 5 25 25 54,681  (38,337) 16,344  87 (8,910) (1,298) (1,481) (1,992) (266) (865) (486) (897) 236  1  237  64  64  301  0.8  0.8  50,157  (34,980) 15,177  ‐ (8,500) (1,590) (1,053) (1,901) (279) (829) (483) (961) (419) (1,235) (1,654) (46) (46) (1,700) (5.4) (5.4) The consolidated statement of profit or loss and other comprehensive income is to be read in conjunction with the attached notes.                                         AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2016 ASSETS CURRENT ASSETS Cash and cash equivalents Trade and other receivables Current tax assets Inventories TOTAL CURRENT ASSETS NON‐CURRENT ASSETS Plant and equipment Intangible assets Deferred tax assets TOTAL NON‐CURRENT ASSETS TOTAL ASSETS LIABILITIES CURRENT  LIABILITIES Trade and other payables Other financial liabilities Provisions TOTAL CURRENT  LIABILITIES NON‐CURRENT  LIABILITIES Provisions Other financial liabilities Deferred tax liabilities TOTAL NON‐CURRENT  LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Share capital Reserves (Accumulated losses)/retained earnings TOTAL EQUITY Economic Entity Note 2016 $'000 2015 $'000 23 6 7 8 10 11 5 12 13 14 14 13 5 15 16 948 8,084 ‐ 12,942 21,974 1,153 7 1,174 2,334 1,521 7,325 1 14,906 23,753 1,365 16 1,146 2,527 24,308 26,280 8,134 3,534 1,580 13,248 200 ‐ 20 220 13,468 10,840 11,138 31  (329) 10,840 9,113 4,719 1,605 15,437 278 23 3 304 15,741 10,539 11,138 (33) (566) 10,539 The consolidated statement of financial position is to be read in conjuntion with the attached notes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2016 Share Capital $'000 Option  Reserve $'000 Foreign  Currency  Translation  Reserve $'000 Retained  Earnings $'000 Total Equity $'000 Economic Entity Balance as at 30 June 2014 Loss for the year Other comprehensive income for the year Total comprehensive income for the year Balance as at 30 June 2015 Profit for the year Other comprehensive income for the year Total comprehensive income for the year 11,138  ‐ ‐ ‐ 11,138  ‐ ‐ ‐ Balance as at 30 June 2016 11,138  ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ 13  ‐ (46) (46) (33) ‐ 64  64  31  1,088  (1,654) ‐ (1,654) (566) 237  ‐ 237  12,239  (1,654) (46) (1,700) 10,539  237  64  301  (329) 10,840  The consolidated statement of changes in equity is to be read in conjunction with the attached notes.                                                                                                                                                                                                                                                                                                                                                                                                                                                          AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2016 Economic Entity Note 2016 $'000 2015 $'000 CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers Payments to suppliers and employees Interest received Interest and other costs of finance paid Income taxes refunded Goods and services tax remitted Net cash provided by operating activities 23 CASH FLOWS FROM INVESTING ACTIVITIES Payments for plant and equipment Net cash (used in) investing activities CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings Repayment of borrowings Net cash (used in)/provided by financing activities Net (decrease)/increase in cash and cash equivalents held Cash and cash equivalents at beginning of year Effect of exchange rate changes on the balance of cash and cash equivalents held in foreign currencies at the beginning of the financial year Cash and cash equivalents at end of year 23 The consolidated statement of cash flows is to be read in conjunction with the attached notes. 58,891  (53,177) 17  (865) 1  (4,148) 719  55,632  (50,702) 22  (829) 10  (3,766) 367  (45) (45) (61) (61) 368  (1,600) (1,232) (558) 1,521  (15) 948  4,353  (3,658) 695  1,001  511  9  1,521  AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 1: INTRODUCTION The financial statements cover the economic entity consisting of Ambertech Limited and its controlled entities.  Ambertech Limited is a company limited by shares, incorporated and domiciled in Australia. Operations and principal activities Ambertech Limited is a distributor of high technology equipment to the professional broadcast, film, recording and  sound reinforcement industries and of consumer audio and video products in Australia and New Zealand. Currency The financial statements are presented in Australian dollars and rounded to the nearest one thousand dollars. Registered office Unit 1, 2 Daydream Street, Warriewood NSW 2102. Authorisation of financial statements The financial statements were authorised for issue on  23 September 2016 by the Directors.  The company has the  power to amend the financial statements. NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (a) Overall Policy The principal accounting policies adopted in the preparation of these consolidated financial statements are stated  in order to assist in a general understanding of the financial statements.  These general purpose financial  statements have been prepared in accordance with Australian Accounting Standards and Interpretations issued by  the Australian Accounting Standards Board (AASB) and the Corporations Act 2001, as appropriate for profit  oriented entities.  The financial statements have been prepared under the historic cost convention. Statement of Compliance The financial statements comply with Australian Accounting Standards which include Australian equivalents to  International Financial Reporting Standards (AIFRS).  Compliance with AIFRS ensures that the financial  statements and notes of the economic entity comply with International Financial Reporting Standards (IFRS). Going Concern After taking into account all of the available information, the directors have concluded that there are reasonable  grounds to believe that the basis for the preparation of the financial statements on a going concern basis is  appropriate. New, revised or amending Accounting Standards and Interpretations adopted The economic entity has adopted all of the new, revised or amending Accounting Standards and interpretations  issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting  period.  Any new, revised or amending Accounting Standards or Interpretations that are not yet mandatory have  not been early adopted. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (a) Overall Policy (continued) New Accounting Standards issued but not yet effective The following standards, amendments to standards and interpretations have been identified as those which may  impact the economic entity in the period of initial application.  They are available for early adoption at 30 June 2016,  but have not been applied in preparing these financial statements. (i) AASB 9:   Financial Instruments  and associated Amending Standards (applicable to annual reporting periods  beginning on or after 1 January 2018). The Standard will be applicable retrospectively (subject to the provisions on hedge accounting outlined below) and  includes revised requirements for the classification and measurement of financial instruments, revised recognition  and derecognition requirements for financial instruments and simplified requirements for hedge accounting. The key changes that may affect the Group on initial application include certain simplifications to the classification  of financial assets, simplifications to the accounting of embedded derivatives, upfront accounting for expected  credit loss, and the irrevocable election to recognise gains and losses on investments in equity instruments that  are not held for trading in other comprehensive income. AASB 9 also introduces a new model for hedge  accounting that will allow greater flexibility in the ability to hedge risk, particularly with respect to hedges of non‐ financial items. Should the entity elect to change its hedge policies in line with the new hedge accounting  requirements of the Standard, the application of such accounting would be largely prospective. Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial  instruments, including hedging activity, it is impracticable at this stage to provide a reasonable estimate of such  impact. (ii) AASB 15:   Revenue from Contracts with Customers  (applicable to annual reporting periods beginning on or after 1  January 2018, as deferred by AASB 2015‐8:   Amendments to Australian Accounting Standards – Effective Date of  AASB 15 ). When effective, this Standard will replace the current accounting requirements applicable to revenue with a  single, principles‐based model. Except for a limited number of exceptions, including leases, the new revenue  model in AASB 15 will apply to all contracts with customers as well as non‐monetary exchanges between entities  in the same line of business to facilitate sales to customers and potential customers. The core principle of the Standard is that an entity will recognise revenue to depict the transfer of promised goods  or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in  exchange for the goods or services. To achieve this objective, AASB 15 provides the following five‐step process: identify the contract(s) with a customer; identify the performance obligations in the contract(s); determine the transaction price; allocate the transaction price to the performance obligations in the contract(s); and recognise revenue when (or as) the performance obligations are satisfied. ‐ ‐ ‐ ‐ ‐ The transitional provisions of this Standard permit an entity to either: restate the contracts that existed in each  prior period presented per AASB 108:   Accounting Policies, Changes in Accounting Estimates and Errors  (subject to  certain practical expedients in AASB 15); or recognise the cumulative effect of retrospective application to  incomplete contracts on the date of initial application. There are also enhanced disclosure requirements regarding  revenue. Although the directors anticipate that the adoption of AASB 15 may have an impact on the Group's financial  statements, it is impracticable at this stage to provide a reasonable estimate of such impact. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (a) Overall Policy (continued) (iii) AASB 16:   Leases  (applicable to annual reporting periods beginning on or after 1 January 2019). When effective, this Standard will replace the current accounting requirements applicable to leases in AASB 117:    Leases  and related Interpretations. AASB 16 introduces a single lessee accounting model that eliminates the  requirement for leases to be classified as operating or finance leases. The main changes introduced by the new Standard include: ‐  recognition of a right‐to‐use asset and liability for all leases (excluding short‐term leases with less than 12  months of tenure and leases relating to low‐value assets); ‐  depreciation of right‐to‐use assets in line with AASB 116:   Property, Plant and Equipment  in profit or loss and  unwinding of the liability in principal and interest components; ‐  variable lease payments that depend on an index or a rate are included in the initial measurement of the lease  liability using the index or rate at the commencement date; ‐  by applying a practical expedient, a lessee is permitted to elect not to separate non‐lease components and  instead account for all components as a lease; and ‐  additional disclosure requirements. The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the Standard to comparatives  in line with AASB 108 or recognise the cumulative effect of retrospective application as an adjustment to opening  equity on the date of initial application. Although the directors anticipate that the adoption of AASB 16 will impact the Group's financial statements, it is  impracticable at this stage to provide a reasonable estimate of such impact. (b) Significant Judgements and Key Assumptions Judgements made in applying accounting policies that have the most significant effect on the amounts recognised in  the financial statements are discussed below. Provision for impairment of receivables The provision for impairment of receivables assessment requires a degree of estimation and judgement. The level of  provision is assessed by taking into account the ageing of receivables, historical collection rates, and specific  knowledge of the individual debtor's financial position. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (b) Significant Judgements and Key Assumptions (continued) Recovery of deferred tax assets Deferred tax assets are recognised for deductible temporary differences and tax losses only if the economic entity  considers it is probable that future taxable amounts will be available to utilise those temporary differences and  losses. Estimated useful life of assets The economic entity determines the estimated useful life and related depreciation and amortisation charges for  plant and equipment and definite life of intangible assets. This is in accordance with the accounting policy stated in  note 2(h).  Provision for impairment of inventories The provision for impairment of inventories assessment requires a degree of estimation and judgement.  The level  of the provision is assessed by taking into account the recent sales experience, the ageing of inventories and other  factors that affect inventory obsolescence. Long service leave provision The liability for long service leave is recognised and measured at the present value of the estimated future cash  flows to be made in respect of all employees at the reporting date. In determining the present value of the liability,  estimates of attrition rates and pay increases through promotion and inflation have been taken into account. Warranty provision In determining the level of provision required for warranties, the economic entity has made judgements in respect  of the expected performance of the product, expected customer claims and costs of fulfilling the conditions of  warranty. The provision is based on estimates made from historical warranty costs associated with similar  products. (c) Consolidation Policy A controlled entity is any entity controlled by Ambertech Limited.  Control exists where Ambertech Limited has  the capacity to dominate the decision‐making in relation to the financial and operating policies of another entity so  that the other entity operates with Ambertech Limited to achieve the objectives of Ambertech Limited.  Details of  the controlled entities are contained at note 9. All inter‐company balances and transactions between entities in the economic entity, including any unrealised  profits or losses, have been eliminated on consolidation.  (d) Revenue Recognition Sales revenue comprises revenue earned (net of returns, discounts and allowances) from the provision of goods  and services to entities outside the economic entity. Sale of goods Revenue from the sale of goods is recognised when all significant risks and rewards of ownership have been  transferred to the buyer.  In most cases this coincides with the transfer of legal title, or the passing of possession to  the buyer. Rendering of services Revenue from the rendering of a service is recognised upon the delivery of the service to the customers. Interest revenue Interest revenue is recognised as it accrues using the effective interest method. Dividend revenue Dividends are recognised as income as they are received, net of any franking credits. (e) Cash and Cash Equivalents For the purposes of the statement of cash flows, cash and cash equivalents includes cash on hand, deposits at call  with banks or financial institutions, investments in money market instruments maturing within three months, and  bank overdrafts. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (f) Trade and other receivables Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using  the effective interest method, less provision for impairment. Trade receivables are generally due for settlement  between 30 and 60 days. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are  written off by reducing the carrying amount directly. A provision for impairment of trade receivables is raised when  there is objective evidence that the economic entity will not be able to collect all amounts due according to the  original terms of the receivables. (g) Inventories Inventories include finished goods and stock in transit and are measured at the lower of weighted average cost and  net realisable value.  Costs are assigned on a first‐in first‐out basis and include direct materials, direct labour and an  appropriate proportion of variable and fixed overhead expenses.  (h) Plant and Equipment Plant and equipment is stated at historical cost less depreciation and impairment.  Historical cost includes  expenditure that is directly attributable to the acquisition of the items. Plant and equipment is depreciated over its estimated useful life taking into account estimated residual values.  The  straight line method is used. Plant and equipment is depreciated from the date of acquisition or, in respect of leasehold improvements, from the  time the asset is completed and ready for use.  The depreciation rates used for each class of plant and equipment  remain unchanged from the previous year and are as follows: Class of Asset Plant and equipment Furniture and fittings Leasehold improvements Leased plant and equipment Useful life 3‐8 years 3‐8 years Term of the lease Term of the lease The carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances  indicate the carrying value may not be recoverable.  If any such indication exists and where the carrying values exceed  the estimated recoverable amount, the plant and equipment or cash generating units to which the plant and  equipment belong  are written down to their recoverable amount. (i) Intangible Assets Goodwill All business combinations are accounted for by applying the acquisition method.  Goodwill represents the difference  between the cost of the acquisition and the fair value of the net identifiable assets acquired. Goodwill is stated at cost less any accumulated impairment.  Goodwill is allocated to cash generating units and is not  subject to amortisation, but tested annually for impairment (refer to note 2(j)).   Where the recoverable amount of the cash generating unit is less than the carrying amount, an impairment loss is  recognised. Website Costs Significant costs associated with website costs are deferred and amortised on a straight‐line basis over the period of  their expected benefit, being a finite life of 3 years. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (j) Impairment of Assets Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested  annually for impairment, or more frequently if events or changes in circumstances indicate that they might be  impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the  carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s  carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less  costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for  which there are separately identifiable cash inflows which are largely independent of the cash inflows from other  assets or groups of assets (cash‐generating units).  If there is evidence of impairment for any of the company’s financial assets carried at amortised cost, the loss is  measured as the difference between the asset’s carrying amount and the present value of estimated future cash  flows, excluding future credit losses that have not been incurred. The cash flows are discounted at the economic  entity's weighted average cost of capital. The loss is recognised in the statement of profit or loss and other  comprehensive income. (k) Trade and Other Payables These amounts represent liabilities for goods and services provided to the economic entity prior to the end of  financial year which are unpaid.   Due to their short term nature, they are measured at amortised cost and are not  discounted.  The amounts are unsecured and are usually paid within 30 days of recognition. (l) Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently  measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption  amount is recognised in the statement of profit or loss and other comprehensive income over the period of the  borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as  transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this  case, the fee is deferred until the draw down occurs. To the extent there is no evidence that it is probable that some or  all of the facility will be drawn down, the fee is capitalised as a prepayment for liquidity services and amortised over  the period of the facility to which it relates.  (m) Service Warranties Provision is made for the estimated liability on all products still under warranty at balance date. The provision is based  on estimates made from historical warranty costs associated with similar products. (n) Leases (i) Operating leases Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are  charged as expenses in the periods in which they are incurred.  Lease incentives under operating leases are  recognised as a liability and amortised on a straight–line basis over the life of the lease term. (ii) Finance leases Lease payments, where substantially all the risks and benefits incidental to the ownership of the leased asset  transfer from the lessor to the lessee, are allocated between the principal component of the lease liability and the  finance costs. Leased assets acquired under a finance lease are depreciated over the term of the lease. (o) Share Based Payments Options issued over ordinary shares are valued using the Black‐Scholes pricing model which takes into account the  option exercise price, the current level and volatility of the underlying share price, the risk free interest rate, the  expected dividends on the underlying share, the current market price of the underlying share and the expected life of  the option. Information relating to these schemes is set out in note 21. The value of the options is recognised in an option reserve until the options are exercised, forfeited or expire. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (p) Employee Benefits Short term employee benefits are employee benefits (other than termination benefits and equity compensation  benefits) which fall due wholly within 12 months after the end of the period in which employee services are rendered.  They comprise wages, salaries, commissions, social security obligations, short‐term compensation absences and  bonuses payable within 12 months and non‐mandatory benefits such as car allowances. The undiscounted amount of short‐term employee benefits expected to be paid is recognised as an expense. Other long‐term employee benefits include long‐service leave payable 12 months or more after the end of the  financial year. (q) Income Tax The income tax expense or benefit for the period is the tax payable on the current period’s taxable income based on  the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities  attributable to temporary differences and to unused tax losses. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax  bases of assets and liabilities and their carrying amounts. However, the deferred income tax is not accounted for if it  arises from initial recognition of an asset or liability in a transaction other than a business combination that at the  time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using  tax rates (and laws) that have been enacted or substantially enacted by the reporting date and are expected to apply  when the related deferred income tax asset is realised or the deferred income tax liability is settled. Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable  that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax  bases of investments in controlled entities where the parent entity is able to control the timing of the reversal of the  temporary differences and it is probable that the differences will not reverse in the foreseeable future. Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets and  liabilities and when the deferred tax balances relate to the same taxation authority.  Current tax assets and tax liabilities are offset where the entity has a legally enforceable right to offset and intends  either to settle on a net basis, or to realise the asset and settle the liability simultaneously. Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly  in equity. Tax consolidation legislation  Ambertech Limited and its Australian wholly owned controlled entities have implemented the tax consolidation  legislation. The head entity, Ambertech Limited, and the controlled entities in the tax consolidated group continue to account  for their own current and deferred tax amounts. These tax amounts are measured as if each entity in the tax  consolidated group continues to be a ‘stand‐alone taxpayer’ in its own right. Current tax liabilities/assets and deferred tax assets arising from unused tax losses and tax credits are immediately  transferred to the head entity. The tax consolidated group has entered a tax sharing agreement whereby each  company in the group contributes to the income tax payable by the group in proportion to their contribution to the  group’s taxable income. Differences between the amounts of net tax assets and liabilities derecognised and the net  amounts recognised pursuant to the funding arrangement will be recognised as either a contribution by, or  distribution to the head entity. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued) (r) Foreign Currency Translation The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation,  are translated to Australian dollars at exchange rates prevailing at the balance sheet date.  The revenues and  expenses of foreign operations are translated to Australian dollars at rates approximating to the exchange rates  prevailing at the dates of the transactions. Foreign exchange differences arising on retranslation are recognised directly in a separate component of equity. (s) Earnings Per Share (i) Basic earnings per share Basic earnings per share is calculated by dividing the profit attributable to equity holders of the company,  excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary  shares outstanding during the year, adjusted for bonus elements in ordinary shares issued during the year. (ii) Diluted earnings per share Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into  account the after income tax effect of interest and other financing costs associated with dilutive potential  ordinary shares and the weighted average number of shares assumed to have been issued for no consideration  in relation to dilutive potential ordinary shares. (t) Share Capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options  are shown in equity as a deduction, net of tax, from the proceeds. (u) Dividends Provision is made for the amount of any dividend declared, being appropriately authorised and no longer at the  discretion of the entity, on or before the end of the year but not distributed at balance date. (v) Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a  substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such  time as the assets are substantially ready for their intended use or sale. Other borrowing costs are expensed. (w) Goods and Services Tax Revenues, expenses and assets are recognised net of the amount of GST, unless the GST incurred is not recoverable  from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the  expense. Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount  of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the  statement of financial position. Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing  activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows. (x) Derivative financial instruments Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently  re‐measured to their fair value at each reporting date. The accounting for subsequent changes in fair value depends  on whether the derivative is designated as a hedging instrument, and if so, the nature of the item being hedged.  Derivatives are classified as current according to expected period of realisation. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 3: REVENUE Revenue  ‐ Sale of goods and services  ‐ Interest received Other income  ‐ Net foreign exchange gains NOTE 4: EXPENSES Additional information on the nature of expenses Inventories Cost of sales Movement in provision for inventory obsolescence Employee benefits expense Salaries and wages Defined contribution superannuation expense Employee termination expense Depreciation Plant and equipment Furniture and fittings Leasehold improvements Leased plant and equipment Amortisation Website costs Other expenses Net foreign exchange losses Bad and doubtful debts Rental expense on operating leases: Minimum lease payments Net loss on disposal of plant and equipment Net fair value (loss) on derivative financial instruments ‐ forward  exchange contracts Economic Entity 2016 2015 $'000 $'000 54,664 17 54,681 50,135 22 50,157 87 87 ‐ ‐ 38,337 34,980 (35) (282) 7,902 851 157 8,910 62 33 146 16 257 9 ‐ 7,610 777 113 8,500 71 37 147 15 270 9 156 128  10  1,431 1,374 ‐ ‐ 1 ‐                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 5: INCOME TAX Major components of income tax Under provision in prior years Deferred tax Deferred tax asset written off Reversal of previously recognised unused losses Income tax (benefit)/expense Reconciliation between income tax and prima facie tax on accounting profit/(loss) Profit/(loss) before income tax  Tax at 30% (2015:30%) Tax effect of non deductible expenses/non assessable income  ‐ Entertainment  ‐ Other items Unused tax losses not recognised as deferred tax assets Recoupment of prior year tax losses not previously brought to account Reversal of previously recognised unused losses Deferred tax asset written off Under provision for income tax in prior years Income tax (benefit)/expense Applicable tax rate The applicable tax rate is the national tax rate in Australia of 30%. Analysis of deferred tax assets Employee benefits Plant and equipment Accrued expenses Provision for impairment of receivables Provision for obsolesence Inventory Unrealised foreign currency loss Other Analysis of deferred tax liabilities Unrealised foreign currency gain Other Economic Entity 2016 2015 $'000 $'000 ‐ (10) 9  ‐ (1) 236  71  15  5  72  (173) ‐ ‐ 9  (1) 485 168 164 48 226 33 ‐ 50 1,174 14 6 20 128  (3) ‐ 1,110  1,235  (419) (126) 13  (41) 276  ‐ 1,110  ‐ 3  1,235  496 135 191 11 238 26 3 46  1,146 ‐ 3 3 Tax consolidated group Ambertech Limited is the head entity in a tax consolidated group.  The tax consolidated legislation has been applied in  respect of the year ended 30 June 2016. Ambertech Limited has entered into a tax sharing agreement with Amber Technology Limited and Alphan Pty Limited.   The tax sharing agreement allows for an allocation of income tax expense to members of the group on the basis of  taxable income. Tax Losses In order to recognise a deferred tax asset relating to tax losses, the Directors must be satisfied that forecast results  provide sufficient evidence that the economic entity will be able to utilise tax losses against future taxable profits of the  economic entity.  As a general rule, Directors will consider forecast reults over a three year period as a guide to  determining the recoverability of the asset. In 2015 the board determined that it could no longer justify the recognition of a deferred tax asset resulting from  accumulated tax losses. At balance date, total unused tax losses available amounted to $5,103,725 (2015: $5,681,604).  The potential tax benefit of these losses at 30% is $1,531,118 (2015: $1,704,481).                                                                                                                                                                                                                                                                                                                                                                                                                                                            AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 6: TRADE AND OTHER RECEIVABLES Current Trade receivables (a) Provision for impairment of receivables (b) Other receivables (a) Prepayments Economic Entity 2016 2015 $'000 $'000 8,057 (160) 7,897 74 113 8,084 7,199 (36) 7,163 32 130 7,325 (a) Current trade and other receivables are non‐interest bearing loans, generally between 30 and 60 day terms.  A provision  for impairment is recognised when there is objective evidence that a trade or other receivable is impaired.  These  amounts have been included in the other expenses item. (b) Movement in the provision for impairment of receivables is as follows: Current trade receivables Opening balance Charge for the year Amounts written off Closing balance 36 128  (4) 160 82 10  (56) 36 (c) The economic entity's exposure to credit risk and impairment losses related to trade and other receivables is disclosed at  note 24. NOTE 7: CURRENT TAX ASSETS The current tax asset in the economic entity of nil (2015: $1,000) represents the amount of income tax recoverable in respect  of current and prior years that arise from the payment of tax in excess of amounts due to the relevant tax authority. NOTE 8: INVENTORIES Current Finished goods Stock in transit Provision for obsolescence (a) (a) Movement in the provision for obsolescence is as follows: Opening balance Charge for the year Amounts written off Closing balance 12,244  1,466  13,710  (768) 12,942 803 637 (672) 768 12,625  3,084  15,709  (803) 14,906 1,085 422 (704) 803                                                                                                                                                                                                                                                                   AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 9: CONTROLLED ENTITIES Entity Parent Entity  ‐ Ambertech Limited Subsidiaries of Ambertech Limited  ‐ Amber Technology Limited Subsidiaries of Amber Technology Limited  ‐ Alphan Pty Limited  ‐ Amber Technology (NZ) Limited NOTE 10: PLANT AND EQUIPMENT Non‐Current Country of Incorporation Australia Australia Australia New Zealand Percentage Owned 2016 2015 100% 100% 100% 100% 100% 100% Cost Accumulated depreciation Net carrying amount 2016 $'000 2015 $'000 2016 $'000 2015 $'000 2016 $'000 2015 $'000 Economic Entity Plant and equipment Furniture and fittings Leasehold improvements Leased plant and equipment Total plant and equipment 1,247 484 1,412 171 3,314 1,242 483 1,412 170 3,307 (1,098) (382) (600) (81) (2,161) (1,076) (348) (454) (64) (1,942) 149 102 812 90 1,153 166 135 958 106 1,365 Reconciliation of carrying amounts: 2016 Plant and  equipment $'000 Furniture and  fittings $'000 Leasehold  improvements $'000 Leased  plant and  equipment $'000 Balance at the beginning of the year Additions Disposals Depreciation and amortisation expense Carrying amount at the end of the year 166  45  ‐ (62) 149  135  ‐ ‐ (33) 102  2015 Plant and  equipment $'000 Furniture and  fittings $'000 Leasehold  improvements $'000 Balance at the beginning of the year Additions Disposals Depreciation and amortisation expense Carrying amount at the end of the year 177  61  (1) (71) 166  172  ‐ ‐ (37) 135  1,105  ‐ ‐ (147) 958  Total $'000 1,365  45  ‐ (257) 1,153  Total $'000 1,575  61  (1) (270) 1,365  958  106  ‐ ‐ (146) 812  ‐ ‐ (16) 90 Leased  plant and  equipment $'000 121 ‐ ‐ (15) 106                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 11: INTANGIBLE ASSETS Non‐Current Goodwill at cost  Less impairment Website at cost  Less accumulated amortisation Reconciliation of written down values: Goodwill Website $'000 ‐ $'000 16 ‐ ‐ ‐ ‐ ‐ ‐ (9) 7 Opening balance at 1 July 2015 Additions Impairment Amortisation expense Closing balance at 30 June 2016 NOTE 12: TRADE AND OTHER PAYABLES Current Trade accounts payable Other accounts payable Amounts payable in foreign currencies: Trade accounts payable:  ‐ US Dollars  ‐ British Pounds  ‐ Euro  ‐ Swiss Francs  ‐ Japanese Yen  ‐ New Zealand Dollars NOTE 13: OTHER FINANCIAL LIABILITIES Current Debtor Finance (a) Lease Liability (b) Bills Payable  Non Current Lease Liability (b) Total $'000 16 ‐ ‐ (9) 7 Economic Entity 2016 2015 $'000 $'000 2,970  (2,970) ‐ 173  (166) 7  7  2,970  (2,970) ‐ 173  (157) 16  16  5,569 2,565 8,134 2,078 78 706 572 ‐ 324 3,758 3,511 23 ‐ 3,534 6,839 2,274 9,113 4,154 51 858 354 1 436 5,854 4,325 38 356 4,719 ‐ 23                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 13: OTHER FINANCIAL LIABILITIES continued Details of the economic entity's exposure to interest rate changes on other financial liabilities is outlined in note 24. The fair value of the financial liabilities approximates their carrying value. (a) Debtor finance On 16 November 2015, the economic entity signed a new two year agreement with Scottish Pacific Business Finance  formerly Bibby Financial Services. This new agreement is an invoice discounting solution with approval up to $6.5M  for Amber Technology Ltd and $0.8M for Amber Technology (NZ) Ltd. The economic entity breached a covenant in relation to the facility during the year. The breach has been set aside by  the lender with ongoing monitoring of the facility. (b) Lease liability The lease liabilities are effectively secured as the rights to the leased assets, recognised in the statement of financial  position, revert to the lessor in the event of default. NOTE 14: PROVISIONS Current Service warranty Employee benefits Non Current Employee benefits Economic Entity 2016 $'000 2015 $'000 158 1,422 1,580 200 200 247 1,358 1,605 278 278 (a) Service warranty Provision is made for the estimated warranty claims in respect of products sold which are still under warranty at balance  date. These claims are expected to be settled in the next financial year. Management estimates the provision based on  historical warranty claim information and any recent trends that may suggest future claims could differ from historical  amounts. (b) Movements in provisions Movements in provisions, other than employee benefits are set out below: Opening balance at 1 July 2015 Additional provision recognised Reductions resulting from payments Closing balance at 30 June 2016  Service  warranty  $'000 247 321 (410) 158 (c) Amounts not expected to be settled within the next twelve months: The current provisions for annual leave and long service leave include all unconditional entitlements where employees  have completed the required period of service.  The entire amount is presented as current, since the economic entity  does not have an unconditional right to defer settlement.  However, based on past experience, the economic entity does  not expect all employees to take the full amount of accrued leave or require payment within the next twelve months. The following amounts reflect leave that is not expected to be taken within the next twelve months: Current annual leave obligation expected to be settled after 12 months Current long service leave obligation expected to be settled after 12 months 249 378 244 380                                                                                                                                                                                                                                                                                AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 15: SHARE CAPITAL Economic Entity 2016 Shares 2015 Shares Economic Entity 2016 2015 $'000 $'000 Ordinary Shares fully paid (no par value) 30,573,181 30,573,181 11,138 11,138 Details Balance 30 June 2015 Shares bought back Balance 30 June 2016 No of shares 30,573,181 ‐ 30,573,181 $'000 11,138 ‐ 11,138 Voting Rights On a show of hands, one vote for every registered shareholder, and for a poll, one vote for every share held by a  registered shareholder. NOTE 16: RESERVES Foreign currency translation reserve (a) 31  31  (33) (33) For an explanation of movements in reserve accounts refer to the Statement of Changes in Equity. Nature and purpose of reserves (a) Foreign currency translation reserve Exchange differences arising on translation of the foreign controlled entity are taken to the foreign currency  translation reserve as described in note 2(r).  The reserve is recognised in profit and loss when the net investment  is disposed of. (b) Option reserve The option reserve is used to recognise the fair value of options issued but not exercised. There are no options on  issue for the year ended 30 June 2016 (2015: nil). NOTE 17: CAPITAL & LEASING COMMITMENTS (a) Operating lease commitments Payable: Not later than 1 year Later than 1 year but not later than 5 years Later than 5 years Minimum lease payments (a) The Warriewood property lease is a non‐cancellable lease ending on 13 January 2023,  with rent payable monthly in advance. Contingent rental provisions within the lease  agreement require that the minimum lease payments shall be increased at review  dates at 3.75% per annum. (b) The economic entity had no commitments for capital expenditure as at 30 June 2016  (2015: Nil) 1,463 7,351 860 9,674 1,431 7,227 2,422 11,080                                                                                                                                                                 AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 18: CONTINGENT LIABILITIES Estimates of the maximum amounts of contingent liabilities that  may become payable:  ‐ Bank guarantees by Amber Technology Limited in respect of  various property leases Economic Entity 2016 $'000 2015 $'000 638 638 638 638 No material losses are anticipated in respect of any of the above contingent liabilities. NOTE 19: EVENTS SUBSEQUENT TO REPORTING DATE Subsequent to year end, the economic entity secured a $4.08M forward exchange contract facility with American  Express FX International Payments. The facility will be used for payment of foreign currency payables and to assist  in managing the economic entity's foreign currency risk. There were no other matters that have arisen since the end  of the financial year that have significantly affected, or may significantly affect the operations or state of affairs of  the economic entity in future financial years. NOTE 20: RELATED PARTY TRANSACTIONS Key management personnel compensation Key management personnel comprises directors and other persons having authority and responsibility for planning,  directing and controlling the activities of the economic entity. Summary  ‐ Short term employee benefits  ‐ Post employment benefits  ‐ Long term employee benefits Economic Entity 2016 $ 2015 $ 1,184,049 163,961 (2,444) 1,345,566 1,120,661 155,725 (20,639) 1,255,747 NOTE 21:  SHARE BASED PAYMENT ARRANGEMENTS The Board may determine the executives and eligible employees who are entittled to participate. There are no  options on issue for the year ended 30 June 2016  (2015: nil).                                                                                             AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 22: SEGMENT REPORTING (a)  Description of segments Management has determined the operating segments based on the internal reports that are reviewed and used by the  Board of Directors in assessing performance and determining the allocation of resources. The economic entity comprises the following operating segments: Professional Lifestyle Entertainment New Zealand (b)  Segment information 2016 Revenue  ‐  ‐  Revenue from external customers Total segment revenue Inter‐segment revenue Result  ‐  Segment EBIT  ‐  Unallocated / corporate result  ‐  EBIT  ‐  Interest revenue Interest and finance costs  ‐   ‐  Profit before income tax  ‐  Income tax expense  ‐  profit for the year Assets  ‐  Segment Assets  ‐  Unallocated/corporate assets  ‐  Total assets Liabilities  ‐ Segment Liabilities  ‐ Unallocated/corporate liabilities  ‐ Total liabilities Distribution of high technology equipment to professional broadcast, film, recording  and sound reinforcement industries. Distribution of home theatre products to dealers, distribution and supply of custom  installation components for home theatre and commercial installations to dealers and  consumers, and the distribution of projection and display products with business and  domestic applications. Distribution of a wide range of quality products for both professional and consumer  markets in New Zealand. Professional Lifestyle  Entertainment New Zealand Eliminations $'000 $'000 $'000 $'000 Economic  Entity $'000 22,722 9 22,731 28,563 154 28,717 3,379 20 3,399 ‐ (183) (183) 54,664 ‐ 54,664 499  977  (256) 7,609 13,435 1,842 4,975 3,383 797 ‐ ‐ ‐ ‐ ‐ 1,220  (136) 1,084  17  (865) 236  1  237  22,886 1,422 24,308 9,155 4,313 13,468 45 45 266 266 Other  ‐ Acquisition of non current segment assets 18 27 ‐  ‐ Depreciation and amortisation of segment  assets 106 158 2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Professional Lifestyle  Entertainment New Zealand Eliminations $'000 $'000 $'000 $'000 Economic  Entity $'000 20,111 19 20,130 26,196 106 26,302 3,828 102 3,930 ‐ (227) (227) 207  (201) 142  ‐ AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 22: SEGMENT REPORTING (continued) 2015 Revenue  ‐ Total segment revenue  ‐  Inter‐segment revenue Revenue from external customers Result  ‐  Segment EBIT Interest revenue Interest and finance costs  ‐  Unallocated / corporate result  ‐  EBIT  ‐   ‐   ‐  Loss before income tax  ‐  Income tax expense  ‐  Loss for the year Assets  ‐  Segment Assets  ‐  Unallocated/corporate assets  ‐  Total assets Liabilities  ‐ Segment Liabilities  ‐ Unallocated/corporate liabilities  ‐ Total liabilities 7,527 14,035 1,972 3,251 5,473 1,069 Other  ‐ Acquisition of non current segment assets 22 33  ‐ Depreciation and amortisation of segment  assets 109 164 6 6 50,135 ‐ 50,135 148  240  388  22  (829) (419) (1,235) (1,654) 23,534 2,746 26,280 9,793 5,948 15,741 61 61 279 279 ‐ ‐ ‐ ‐                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 22: SEGMENT REPORTING (continued) (c) Segment information on geographical region Segment Revenues from  Sales to External  Customers 2016 $'000 2015 $'000 Carrying Amount of  Segment Non Current  Assets 2016 $'000 2015 $'000 Acquisition of Non‐  Current Assets 2016 $'000 2015 $'000 Geographical Location  ‐ Australia  ‐ New Zealand 51,285 3,379 54,664 46,307 3,828 50,135 1,154 6 1,160 1,373 8 1,381 45 ‐ 45 55 6 61 (i) Carrying amount of segment non current assets These amounts include all non current assets other than deferred tax assets located in the country of domicile. (d) Other segment information (i) Accounting Policies Segment revenues and expenses are those directly attributable to the segments and include any joint revenues and  expenses where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and  consist principally of cash, receivables, inventories and property, plant and equipment and goodwill.  All remaining  assets of the economic entity are considered to be unallocated assets. Segment liabilities consist principally of  accounts payable, employee entitlements, accrued expenses, provisions and borrowings. Segment assets and liabilities do not include income taxes. (ii) Intersegment Transfers Segment revenues, expenses and result include transfers between segments. The prices charged on intersegment  transactions are the same as those charged for similar goods to parties outside of the economic entity. These transfers  are eliminated on consolidation. (iii) Major Customers During the year ended 30 June 2016, $7,535,289 or 14% (2015: $6,373,623 or 13%) of the consolidated entity's external  revenue was derived from sales to a major Australian retailer through the Lifestyle Entertainment segment.                                                                                                                                                                                                                                                                                        AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 23: CASH FLOW INFORMATION (i) Cash and cash equivalents Cash and cash equivalents included in the statement of cash flows comprise  the following amounts: Cash on hand At call deposits with financial institutions (ii) Reconciliation of net cash provided by operating activities to  profit/(loss) after income tax Profit/(loss) for the year Depreciation and amortisation Net loss on disposal of plant and equipment Foreign exchange (gain)/loss Impairment expense Changes in operating assets and liabilities (Increase)/decrease in trade and other receivables Decrease in prepayments Decrease/(increase) in inventories Decrease in tax receivable (Decrease)/increase in trade and other payables (Decrease) in provisions (Increase)/decrease in deferred taxes Net cash provided by operating activities (iii) Non Cash Financing and Investing Activities There were no non‐cash financing or investing activities during the financial year. Economic Entity 2016 2015 $'000 $'000 3 945 948  237  266  ‐ (77) 128  (851) 18  2,054  1  (932) (114) (11) 719  3 1,518 1,521 (1,654) 279  1  156  29  849  26  (1,207) 10  699  (56) 1,235  367               AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 24: FINANCIAL RISK MANAGEMENT The economic entity's financial risk management policies are established to identify and analyse the risks faced by the  business, to set appropriate risk limits and controls, and to monitor risks and adherence to limits.  Risk management  policies and systems are reviewed regularly to reflect changes in market conditions and the economic entity's  activities. The economic entity's activities expose it to a wide variety of financial risks, including the following: credit risk liquidity risk  ‐  ‐  ‐ market risk (including foreign currency risk and interest rate risk) This note presents information about the economic entity's exposure to each of the above risks, the objectives, policies  and processes for measuring and managing risk and how the economic entity manages capital. Liquidity and market risk management is carried out by a central treasury department (Group Treasury) in accordance  with risk management policies. The Board has overall responsibility for the establishment and oversight of the risk  management framework.  The Board, through the Audit and Risk Management Committee, oversees how  management monitors compliance with the risk management policies and procedures and reviews the adequacy of the  risk management framework in relation to risks. The economic entity uses derivative financial instruments such as foreign exchange contracts to hedge certain risk  exposures.  Derivatives are used exclusively for hedging purposes.  The economic entity does not enter into or trade  financial instruments, including derivative financial instruments, for speculative purposes. Credit Risk Credit risk is the risk of financial loss to the economic entity if a customer or the counterparty to a financial instrument  fails to meet its contractual obligations, and arises principally from the economic entity's receivables from customers.  The maximum exposure to credit risk is the carrying amount of the financial assets. Trade and other receivables Exposure to credit risk is influenced mainly by the individual characteristics of each customer.  The customer base  consists of a wide variety of  customer profiles.  New customers are analysed individually for creditworthiness, taking  into account credit ratings where available, financial position, past experience and other factors.  This includes major  contracts and tenders approved by executive management.  Customers that do not meet the credit policy guidelines  may only purchase using cash or recognised credit cards. The general terms of trade for the economic entity are  between 30 and 60 days. In monitoring credit risk, customers are grouped by their debtor ageing profile.  Monitoring of receivable balances on  an ongoing basis minimises the exposure to bad debts. Impairment allowance The impairment allowance relates to specific customers, identified as being in trading difficulties, or where specific  debts are in dispute.  The impairment allowance does not include debts past due relating to customers with a good  credit history, or where payments of amounts due under a contract for such customers are delayed due to works in  dispute and previous experience indicates that the amount will be paid in due course. AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 24: FINANCIAL RISK MANAGEMENT (continued) The ageing of trade receivables at the reporting date was: Not past due Past due up to 30 days Past due 31‐60 days Past due 61 days and over Total trade receivables not impaired Trade receivables impaired Total trade receivables Economic Entity 2016 2015 $'000 $'000 4,790  2,628  358  121  7,897  160  8,057  3,958  2,753  451  1  7,163  36  7,199  The economic entity does not have  other receivables which are past due (2015: Nil). Liquidity Risk Liquidity risk is the risk that the economic entity will not be able to meet its financial obligations as they fall due.  The  economic entity's policy for managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity  (cash reserves and finance facilities) to meet its liabilities when due, under both normal and stressed conditions.  The  objective of the policy is to maintain a balance between continuity of funding and flexibility through the use of finance  facilities. The economic entity monitors liquidity risk by maintaining adequate cash reserves and financing facilities and by  continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and  liabilities.  The table below summarises the maturity profile of the economic entity's financial liabilities based on  contractual undiscounted payments: 2016 Financial liabilities due for payment Trade and other payables Debtor Finance Lease Liability Total expected outflows Financial assets ‐ cash flows realisable Cash and cash equivalents Trade receivables Total anticipated inflows Net (outflow) on financial instruments Contractual Cash Flows Within  1 Year $'000 1 to 5 Years $'000 Over 5 Years $'000 5,569  3,782  24  9,375  948  7,897  8,845  (530) ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ Total $'000 5,569  3,782  24  9,375  948  7,897  8,845  (530)                                                                                                                                                                                                                                 AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 24: FINANCIAL RISK MANAGEMENT (continued) Contractual Cash Flows Within  1 Year $'000 1 to 5 Years $'000 Over 5 Years $'000 2015 Financial liabilities due for payment Trade and other payables Debtor Finance Commercial Bills Lease Liability Total expected outflows Financial assets ‐ cash flows realisable Cash and cash equivalents Trade receivables Total anticipated inflows 6,839  4,671  383  42  11,935  1,521  7,163  8,684  24  24  ‐ ‐ ‐ ‐ ‐ ‐ Net (outflow) on financial instruments (3,251) (24) ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ ‐ Total $'000 6,839  4,671  383  66  11,959  1,521  7,163  8,684  (3,275) The economic entity also has a number of premises under operating lease commitments.  The future contracted  commitment at year end is disclosed at note 17. The carrying amounts of cash and cash equivalents, trade and other receivables and trade and other payables are  assumed to approximate their fair values due to their short term nature. The fair value of debtor finance and lease liabilities is estimated by discounting the remaining contractural  maturities at the current market interest rate that is available for similar financial liabilities. Market Risk Market risk is the risk that changes in market prices will affect the economic entity's income or the value of its  holdings of financial instruments.  The activities of the ecomonic entity expose it primarily to the financial risks of  changes in foreign currency rates and interest rates.  The objective of market risk management is to manage and  control market risk exposures within acceptable parameters, whilst optimising the returns. Foreign Currency Risk The following table demonstrates the impact on the profit and equity of the economic entity, if the Australian  Dollar weakened/strengthened by 10%, which management consider to be reasonably possible at balance date  against the respective foreign currencies, with all other variables remaining constant: Impact on profit/(loss) Weakening of 10% 2015 $'000 2016 $'000 (418) (650) Impact on equity (418) (650) Strengthening of 10% 2016 $'000 2015 $'000 342  342  532  532                                                                                                                                                                                            AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 24: FINANCIAL RISK MANAGEMENT (continued) Interest Rate Risk The economic entity has a debtor financing facility.  The use of the facility exposes the economic entity to cash flow  interest rate risk. As at the reporting date, the economic entity had the following fixed and variable rate borrowings: Commercial Bills Debtor Finance Note Weighted average  interest rate 2016 % ‐ 7.72% 2015 % 7.54% 8.00% 13 13 Balance 2016 $'000 2015 $'000 ‐ 3,511 356 4,325 The following table demonstrates the impact on the profit and equity of the economic entity if the average interest  rate on the borrowing facility had either increased or decreased by 1%, which management consider to be reasonably  possible over the whole year ending 30 June 2016, with all other variables remaining constant: Impact on profit/(loss) Impact on equity Increase of 1% of average  interest rate 2016 $'000 2015 $'000 Decrease of 1% of  average interest rate 2016 2015 $'000 $'000 (35) (35) (49) (49) 35  35  49  49  Net Fair Values The net fair values of assets and liabilities approximate their carrying values.  No financial assets or liabilities are readily  traded on organised markets. Capital Management The Board's aim is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to  sustain future development of the business.  The Board seeks to maintain a balance between the higher returns that  might be possible with higher levels of borrowings and the advantages and security afforded by a sound capital  position. Total capital is defined as shareholders' equity.  The Board monitors the return on capital, which is defined as net  operating income divided by total shareholders' equity.  The Board also establishes a dividend payout policy which is  targeted as being greater than 50% of earnings, subject to a number of factors, including the capital expenditure  requirements and the company's financial and taxation position. Dividends paid for the year ended 30 June 2016 were  nil (2015: nil). There were no changes to the economic entity's approach to capital management during the financial year.                                                                          AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 25:  EARNINGS PER SHARE Basic earnings per share (cents) Weighted average number of ordinary shares (number) Earnings used to calculate basic earnings per share ($) Diluted earnings per share (cents) Weighted average number of ordinary shares (number) Earnings used to calculate diluted earnings per share ($) Economic Entity 2016 2015 0.8  30,573,181 237,000  (5.4) 30,573,181 (1,654,000) 0.8  30,573,181 237,000  (5.4) 30,573,181 (1,654,000) NOTE 26: DIVIDEND FRANKING CREDITS Tax rate Amount of franking credits available for subsequent reporting periods ($'000) 30% 6,139 30% 6,139 NOTE 27: AUDITORS' REMUNERATION During the year the following fees were paid or payable for services provided by the  auditor of the parent and its related practices: Audit services BDO East Coast Partnership Audit and review of financial reports, and other work under the Corporations Act  2001. Other practices ‐ BDO Auckland (Formerly PKF) Audit or review of financial reports of subsidiary Total remuneration for audit services Non‐audit services BDO East Coast Partnership $ $ 111,500 101,975 ‐ 111,500 12,485 114,460 Tax compliance services, including review of company income tax returns 26,299 16,900 Other practices ‐ BDO Auckland (Formerly PKF) Tax compliance services, including review of company income tax returns Total remuneration for non‐audit services 2,193 28,492 6,552 23,452 It is the economic entity's policy to employ BDO on assignments additional to their statutory audit duties where BDO's  expertise and experience with the economic entity are important.  These assignments are principally tax compliance  assignments.                                                                                                                                                                                                       AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS NOTE 28: PARENT ENTITY INFORMATION Information relating to Ambertech Limited (parent entity):  ‐ Current Assets  ‐ Total Assets  ‐ Current Liabilities  ‐ Total Liabilities  ‐ Share capital  ‐ Retained earnings Profit of the parent entity Total comprehensive income of the parent entity Contingent Liabilites The parent entity had no contingent liabilities as at 30 June 2016 (2015: Nil). Parent Entity 2016 $'000 2015 $'000 11,045 15,602 1,462 1,462 11,138 3,002 ‐ ‐ 11,045 15,602 1,462 1,462 11,138 2,999 3  3  Capital Commitments The parent entity had no capital commitments for property, plant and equipment as at 30 June 2016 (2015: Nil) Significant Accounting Policies The accounting policies of the parent entity are consistent with those of the consolidated entity, as disclosed in  note 1.                                                                                                                             AMBERTECH LIMITED AND CONTROLLED ENTITIES ACN 079 080 158 DIRECTORS' DECLARATION The directors of the company declare that: 1. The financial statements, comprising the statement of profit or loss and other comprehensive income,  statement of financial position, statement of cash flows, statement of changes in equity and accompanying  notes, are in accordance with the Corporations Act 2001  and: (a) (b) comply with Accounting Standards and the Corporations Regulations  2001 ; and give a true and fair view of the consolidated entity's financial position as at 30 June 2016 and of its  performance for the year ended on that date. 2. 3. 4. The company has included in the notes to the financial statements an explicit and unreserved statement of  compliance with International Financial Reporting Standards. In the directors' opinion, there are reasonable grounds to believe that the company will be able to pay its  debts as and when they become due and payable. The directors have been given the declarations by the chief executive officer and chief operating officer  required by Section 295A of the Corporations Act 2001. This declaration is made in accordance with a resolution of the Board of Directors persuant to section 295(5)(a)  of the Corporations Act 2001, and is signed for and on behalf of the directors by: P F Wallace  Director  P A Amos  Director  Dated this 23rd day of September 2016. Sydney Shareholder Information The following information is required by the Australian Securities Exchange Limited. Distribution of equity security by size of holding: 1 1,001 5,001 10,001 100,001 - - - - and 1,000 5,000 10,000 100,000 over Number of shareholders 70 62 31 40 22 Number of Ordinary Shares 63,933 223,698 275,550 1,387,360 28,623,640 % of total capital 0.21 0.73 0.90 4.54 93.62 Total 225 30,573,181 100.00 The number of security investors holding less than a marketable parcel of 3,704 securities is 97 and they hold 123,581 securities. Equity Security Holders The twenty largest shareholders as at 21 October 2016 were: Rank Twenty largest holders Number of shares % of total capital 1 Appwam Pty Limited 2 Crowton Pty Ltd (Amos Super Fund) 3 Howbay Pty Ltd 4 Wavelink Systems Pty Ltd 5 Wavelink Systems Pty Ltd (Employee Superannuation 6 Equity Management Group Pty Ltd 7 Wygrin Pty Ltd 8 Wygrin Pty Ltd (Wygrin Pension Fund) 9 Crowton Pty Limited Fund) A/C) 10 JH Nominees Australia Pty Ltd (Harry Family Super Fund 11 Milton Yannis 12 ABN AMRO Clearing Sydney (Custodian A/C) 13 Mr Ralph McCleery 14 Mr Joseph Paul Grech & Ms Deborah Lee Grech 15 Henriksen Consulting Pty Ltd (Henriksen Consulting S/F 16 Mr David Scicluna & Mr Anthony Scicluna 17 Super Accumulation Pty Ltd (M Robinson Super Fund A/C) 18 Mr David Le Cornu & Mrs Betty Le Cornu 19 Xanthippus Pty Ltd 20 Wallace Capital (Charwal A/C) AC) 6,984,652 3,231,681 2,883,556 2,784,625 2,650,000 1,952,484 1,507,556 1,488,270 1,082,162 993,250 404,348 403,237 357,599 333,261 315,059 259,000 250,000 220,000 155,300 152,600 28,408,640 22.85 10.57 9.43 9.11 8.67 6.39 4.93 4.87 3.54 3.25 1.32 1.32 1.17 1.09 1.03 0.85 0.82 0.72 0.51 0.50 92.92 Source: Link Market Services Substantial Shareholders Substantial shareholders with a relevant interest of 5% or more of total issued shares, based on notifications provided to the company under the Corporations Act 2001 include: Shareholder Appwam Pty Limited Wavelink Systems Pty Ltd Crowton Pty Limited Wygrin Pty Ltd Howbay Pty Ltd Equity Management Group Pty Ltd On-Market Buy Back Number of shares % of total capital 6,984,652 5,484,625 4,313,843 2,995,826 2,883,556 1,952,484 22.85 17.94 14.11 9.80 9.43 6.39 On 2 September 2005, the company lodged an Appendix 3C announcing an on-market buy-back of up to 1,543,150 ordinary shares on issue. On 28 September 2006 the company lodged an Appendix 3D amending the buy-back duration to unlimited. The company has not lodged an Appendix 3F to finalise the buy back as at 21 October 2016. The buy back is a part of the company's capital management and is designed to improve shareholder returns. During the year ended 30 June 2016 no shares were bought back by the company. Voting rights On a show of hands, one vote for every registered shareholder, and for a poll, one vote for every share held by a registered shareholder. Corporate Directory Directors Peter F Wallace - Chairman Peter A Amos - Managing Director Tom R Amos Edwin F Goodwin David R Swift Bankers Scottish Pacific Business Finance Level 5, 20 Bond Street Sydney NSW 2000 T: +61 2 9372 9999 Company Secretary Robert J Glasson Share Registry Link Market Services Locked Bag A14 South Sydney NSW 1235 Or Level 12, 680 George Street Sydney NSW 2000 T: +61 2 8280 7111 or T: 1300 554 474 Auditors BDO East Coast Partnership Level 11, 1 Margaret Street Sydney NSW 2000 T: + 61 2 9251 4100 ASX Listing AMO www.ambertech.com.au www.amberonline.com.au Registered Office Unit 1, 2 Daydream Street Warriewood NSW 2102 T: +61 2 9998 7600 Melbourne Suite 12, 79-83 High Street Kew VIC 3101 T: +61 3 9853 0401 Brisbane Unit 35, 28 Burnside Road Yatala QLD 4207 T: +61 7 3287 2928 Auckland Unit 3, 77 Porana Road Glenfield, Auckland 0672 New Zealand T: + 64 9 443 0753 Corporate Governance Statement www.ambertech.com.au/investors/corporate-governance Ambertech Limited PO Box 955 Mona Vale Unit 1, 2 Daydream St Warriewood NSW 2102 Email: info@ambertech.com.au Phone: 02 9998 7600 Fax: 02 9999 0770 ACN 079 080 158 

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