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Annual Report 2022 Anatara Lifesciences Ltd
Page 1
Anatara
Lifesciences Ltd
ABN 41 145 239 872
Annual Report
2022
Annual Report 2022 Anatara Lifesciences Ltd
Company Vision
Page 2
Our Vision
To provide evidence-based solutions for gastrointestinal tract
health issues to address a significant unmet clinical need.
Annual Report 2022 Anatara Lifesciences Ltd
Contents
Page 3
Contents
Vision Statement ..................................................................................................................................................................................... 2
Contents .......................................................................................................................................................................................................... 3
Corporate Directory ............................................................................................................................................................................... 4
Chair’s Letter ................................................................................................................................................................................................ 5
Review of Operations and Activities ....................................................................................................................................... 8
GaRP Trial Overview ............................................................................................................................................................................10
Directors’ Report...................................................................................................................................................................................... 12
Auditor’s Independence Declaration .................................................................................................................................. 29
Corporate Governance Statement ......................................................................................................................................... 30
Financial Report – 30 June 2022 ............................................................................................................................................... 31
Independent Auditor’s Report ................................................................................................................................................... 65
Shareholder Information................................................................................................................................................................. 69
Annual Report 2022 Anatara Lifesciences Ltd
Corporate Directory
Page 4
Corporate Directory
Directors
Dr David Brookes
Executive Chair
Ms Sue MacLeman
Non-Executive Director
Dr Jane Ryan
Non-Executive Director
Secretary
Mr Stephen Denaro
Registered office and principal place of business
Level 3, 62 Lygon Street Carlton South VIC 3053 Australia
Telephone: +61 (0)3 9824 5454
Share register
Computershare Investor Services Pty Limited
Level 1, 200 Mary Street
Brisbane QLD 4000
+61 (0)7 3237 2100
Auditor
Grant Thornton Audit Pty Ltd
Collins Square
Tower 5, 727 Collins Street
Melbourne VIC 3008
Telephone: +61 (0)3 8320 2222
Solicitors
Thomson Geer
Level 16, Waterfront Place 1 Eagle Street
Brisbane QLD 4000
Bankers
Commonwealth Bank of Australia
Melbourne VIC 3000
Stock exchange listings
Anatara Lifesciences Ltd shares are listed
on the Australian Securities Exchange (ASX code: ANR)
Website
www.anataralifesciences.com
Annual Report 2022 Anatara Lifesciences Ltd
Chairman’s Message
Page 5
Chairman’s
Message to
Shareholders
Dear Shareholders,
Thank you for your continued support and investment in Anatara Lifesciences. On behalf of the Board
of Directors, I am pleased to present Anatara’s 2022 Annual Report. As you are aware, I became
Executive Chairman of the Anatara Board in June 2022, upon the resignation of the Chief Executive
Officer, Steven Lydeamore. This leadership change coincided with a critical assessment of the
Company’s assets, arrangements and a review of Anatara’s trials due to the struggling enrolment
rates, despite broadening eligibility criteria.
Anatara remains focused on the GaRP (Gastrointestinal ReProgramming multicomponent coated
complementary medicine) Irritable Bowel Syndrome (IBS) 200 patient clinical trial which the
Company continues to prioritise, striving to achieve interim results by Q1CY2023. In line with the
Company’s vision, the IBS trial is consistent with developing innovative, evidence-based products for
gastrointestinal health.
There have been significant challenges and delays with the GaRP-IBS trial which we have addressed
and will be further explained in the Annual Report and at the AGM presentations. These have been
frustrating for all involved at Anatara, our shareholders and the many members of the community
who have expressed interest in involvement, particularly those that have enrolled and not been able to
further participate. I would like to take this opportunity to thank all those who have been involved or
expressed interest and apologise for any inconvenience or frustrations; technical or otherwise.
Some of the earlier unforeseen challenges included the COVID-19 impact around the original trial
commencement leading to a reorganisation to appoint a new CRO and the many operational and
manufacturing disruptive considerations from the pandemic not unique to Anatara. As we all know,
emerging from the DELTA wave of the pandemic was far from the end with OMICRON then being a
further dynamic that hampered progressing our trials for months. When able to have some
consistency and continuity, the need for trial refinements became apparent including eligibility
expansion requirements to accommodate the unique issues and challenges that sufferers of IBS
deal with.
The Company remains optimistic in pursuing the GaRP-IBS study and to realise the
commercialisation opportunities. I look forward to updating the GaRP trial progress including
enrolments at the AGM, with numbers anticipated to be approaching 50% of the numbers required
(90) from Stage 1 for interim analysis. The interim analysis will be a pivotal near milestone for the
Company.
Annual Report 2022 Anatara Lifesciences Ltd
Chairman’s Message
Page 6
Completion of the GaRP-IBS interim phase without safety and tolerance concerns, and with an
efficacy signal for dose selection into Stage 2, will have the Company well placed to address broader
gastrointestinal health (GIT) considerations for the use of GaRP. This will be consistent with our vision
to address unmet needs for evidence-based solutions and advice for many sufferers of GIT symptoms
and disorders.
The GaRP-IBS trial was broadened from including only the IBS-Diarrhoeal subtype to all IBS subtypes
that sufferers experience, with the exception of the Constipation subtype. Subsequently, despite the
changes to criteria and associated trial modifications, the improvement in the enrolment rate was not
to levels that ensured a viable timeline. The ongoing review process identified areas for improvement
to enhance trial participation including the screening failure rate in a baseline period before
assignement to the study (i.e. to product or placebo).
On September 1st, the Anatara Advisory Board was reconvened to look at this issue and the inclusion/
exclusion criteria. The Advisory Board’s recommendations to enhance the participation process and
assist enrolment were consistent with Anatara’s proposed strategies. We are proceeding with ethics
regulatory review for approval of these changes and intend to implement these re-defined criteria as
soon as practical. These will accompany new communication methods to further enhance and
accelerate recruitment which are anticipated to be in place in December.
The last quarter in FY22 saw the completion of the approval process for adding the Royal Melbourne
Hospital to the IBS trial as an important new site. This site initiation in 3Q2022 has assisted the
Gastrointestinal Reprogramming (GaRP) trial progress and Anatara is in discussion for further sites
and services to make participation in the trial easier. A presentation on the GaRP trial will be
presented by Anatara’s Clinical Trials Manager, Kylie Wilkie, and our Chief Operating Officer,
John Michailidis at the AGM.
There is strong mainstream support for a product that assists the restoration and functioning of the
gut lining and the homeostasis of the microbiome. GaRP has wider potential for medical indications,
in particular inflammatory bowel disease (IBD), and in general use for relief of common GIT
symptoms. The Company is confident that a positive interim readout in the GaRP-IBS trial will provide
the foundation for broadening interest to other mainstream indications for the use of GaRP.
Importantly, and as expected, with the use of a coated, combination of GRAS* components, there
have been no safety nor tolerance concerns detected with the GaRP formulations including the
subset of 3FDC.
As announced subsequent to FY2022, the trial with the CSIRO on the use of the 3FDC components of
GaRP combination medicine for effect on psychological functioning was halted in September 2022.
This study had been in the process of recruiting participants with mild to moderate levels of anxiety,
depression or stress symptoms, without having specific GIT issues.
To date, no safety or tolerance concerns have been detected in the study which is an important
positive point for the GaRP safety data base. The GaRP complementary medicine includes a subset
of 3 components formulated for release in the lower intestinal tract which have been labelled “3FDC”.
The GaRP-IBS trial has as secondary endpoints the Hospital Anxiety and Depression Scale (HADS) and
Quality of Life (QOL) assessments. These will allow for preliminary analysis of the influence of the total
GaRP components, in participants with gastrointestinal symptoms, on
depression and anxiety.
This anticipated insight regarding the relationship of anxiety and depressive symptoms with gut
disorders (which is in keeping with the general interest in the gut-brain axis) may provide preliminary
information about progressing the use of the full GaRP complementary medicine, which includes the
3FDC components, for these indications.
* Generally Recognised As Safe – US FDA designation that a substance is considered safe for use in food.
Annual Report 2022 Anatara Lifesciences Ltd
Chairman’s Message
Page 7
Given the broader indication opportunities for GaRP and the size of the gastrointestinal (GIT) health
complementary medicine market, we remain committed to the GaRP trial as a project that can add
substantially to overall shareholder value following a successful completion of the IBS trial.
With confidence around the manufacturing specifications of GaRP as a complementary medicine,
Anatara continues to critically assess other complimentary projects, opportunities and assets
predominantly in - or directly related to - gastrointestinal health. Whilst the Company has progressed
down the due diligence path on some of these assessments and continues to look at fresh
opportunities, a compelling target project or asset has not been found at this point in time.
In parallel, the business is establishing a marketing communications plan and customer strategy.
This aims to promote interest in trial participation and results and the Company’s activities in general,
as we intend to develop a reputation as a trusted source of information and activities in gut health.
The use of Anatara’s products in animal health present a promising but challenging potential,
particularly in logistics of delivery and the variable efficacy seen so far. This has softened commercial
interest from potential partners though we continue to discuss with interested parties the products
for use in weanling pigs and poultry production. The global push for meat products free of antibiotics
and animal husbandry not contributing to antimicrobial resistance provides an opportunity especially
with Europe leading the way with a ban on zinc oxide (ZnO) as an additive being put in place in June
2022.
I would like to thank our small team for their dedicated efforts during FY22 particularly given the
challenges faced. Mr. John Michailidis has provided important input as Chief Operating Officer since
joining to coincide with my commencement as executive chair in June of this year. I also thank my
fellow Directors for their input, noting Board reviews and transition are part of ongoing governance
with Ms. Sue McLeman having signalled her preference to retire from the Anatara Board around the
time of the AGM. We all thank Sue for her contribution as a Board member and previous Chair,
wishing her well with her future endeavours and many interests.
On behalf of the Anatara Board and management team, I offer our sincere thanks to shareholders,
the clinical community and participating trial sites for their ongoing support.
We remain motivated and inspired to commercialise evidence-based solutions for gastrointestinal
health and look forward to updating you on our progress.
Yours sincerely,
Dr. David Brookes
Executive Chair
Annual Report 2022 Anatara Lifesciences Ltd
Operations Update
Page 8
Operations and Activities
Update
GMP Manufacturing
GMP Manufacturing of GaRP as well as matching placebo is now complete. No further product will
be required until at least 2024.
Stability testing
The product has proven to be very stable at room temperature to date.
Stability testing will be conducted in Australia from now on bringing this important function back
home.
Major Manufacturing Milestone achievement
Manufacturing enough product for at least 12-18mths to GMP standard is a major milestone in
Anatara’s progress toward commercialisation and of course, will alleviate the need for further
expenditure on production for the foreseeable future.
Once we pass our interim milestone for the GaRP trial in IBS we can begin the tasks for process
improvement in manufacturing which will continue to reduce COGS.
Three key aspects of manufacturing we can improve are:
1. Alternative vendors for GaRP constituents and back-up vendors
2. Reduce batch cycle time which will significantly reduce COGS
3. Finalise packaging of the product for commercial use
GaRP Trial
The delayed recruitment for this study is comparable to delays seen in all studies during the
pandemic. We have identified all mechanistic bottlenecks that potentially hinder recruitment and
improvements are being implemented now. These are in addition to the widening of the IBS disease
state criteria already implemented.
These include:
▶ Revisions to the inclusion criteria to make screening easier and more streamlined
▶ Revisions to the concomitant medication list to allow for real-world use and provide
investigators with the ability to judge the relevance at screening
▶ Greater patient contact with clinical trial staff, particularly during the early phases of the
study to help reassure patients as well as assist in guiding them through the screening
process
▶ Expanded sites for greater accessibility to the study
Importantly, no adverse or serious adverse events have been reported in the study to date, and those
in the study have progressed through it smoothly.
Annual Report 2022 Anatara Lifesciences Ltd
Operations Update
Page 9
Royal Melbourne Hospital - new trial site
The Royal Melbourne Hospital in now an active site for the study which is an important milestone in
assisting with the reach of the study to the many IBS sufferers wishing to participate but also to the
credibility of the evidence base the study will add to. Given the paucity of reliable treatment options
for IBS, it is no wonder that many IBS sufferers want to participate and the interest from key
gastroenterologists is very high.
Partnering:
We have a long list of potential partner companies that have indicated interest in GaRP and await
trial results. It is our intention to progress partnering discussion at the earliest inflection point which
will be the interim analysis stage after the first 90 patients in CYQ1 2023.
Animal Health:
The company is still pursuing relevant application of its products in both weanling piglets and broiler
chickens. The worldwide push to eliminate feed additives like antibiotics and zinc oxide provide
Anatara with an interesting option for the development of alternative preventative feed additives.
We are currently in discussion with key players in the field and although this is not the main area of
development for Anatara, it reflects the manifold possibilities for Anatara’s products.
Annual Report 2022 Anatara Lifesciences Ltd
GaRP Overview
Page 10
GaRP Trial
Presentation
GaRP Background and Clinical Trial Overview
Anatara is conducting a randomized, double-blind, placebo-controlled clinical trial to determined
osage and evaluate efficacy of the Gastrointestinal ReProgramming (GaRP) Dietary supplement in IBS
patients.
IBS and IBD patients, clinicians, and researchers are paying more attention to complementary and
alternative medicine (CAM). It is estimate up to 50% of IBS/IBD patients turn to dietary supplements,
complementary and alternative medicines1,2 with healthcare professionals increasingly
recommending the use of such supportive treatments3
Irritable Bowel Syndrome - Key Statistics
IBS is a complex disorder of multifactorial aetiology, with symptoms including abdominal pain,
bloating, gas, nausea and alternating constipation and diarrhoea. Current treatment options for IBS
are limited due to the complex pathophysiology of this condition, and as such, there is a severe
unmet clinical need for products that can treat each of these primary underlying factors and induce
sustained remission in patients. Irritable Bowel Syndrome (IBS) affects around 11% of the global
population4. In Australia: approximately 30% of Australians will experience symptoms of IBS in their
lifetime5.
What is GaRP?
GaRP is a microbiome-targeted, multi-component dietary supplement that has been designed to
address the primary underlying factors associated with chronic gastrointestinal conditions such as IBS.
1 Gastroenterology 2017: 152:415-429
2 World J. Gastroenterolg 2014: 346 – 362
3 Michelfelder, Lee, & Bading 2010
4 Clinical Gastroenterology and Hepatology 2012: 10, 712-721
5 Dieticians Australia 2022, dieticiansaustralia.org.au, Accessed 10 October 2022
Annual Report 2022 Anatara Lifesciences Ltd
GaRP Overview
Page 11
Gastrointestinal RePrograming (GaRP) - A potential breakthrough for gut health
GaRP – Irritable Bowel Syndrome (IBS) – Clinical Trial Design
GaRP-IBS Trial
The GaRP IBS trial is powered to deliver results that, if successful, will validate clinical claims.
Furthermore, if successful, the high prevalence of digestive disorders requiring relief from both
symptoms and the disease process, including irritable bowel syndrome (IBS), present a significant
market opportunity for Anatara. Pictured below is the Clinical Trial Design.continue to reduce COGS.
As mentioned earlier, The GaRP clinical study is a randomized, double blind placebo controlled study.
This represents the highest level of evidence for clinical trials and will support Anatara's pursuit of
evidence based products in this important disease state with a high unmet need.
Annual Report 2022 Anatara Lifesciences Ltd
Director’s Report
Page 12
Director’s Report
Your directors present their report on the consolidated entity consisting of Anatara Lifesciences Ltd
and the entities it controlled at the end of, or during, the year ended 30 June 2022. Throughout the
report, the consolidated entity is referred to as the group.
Directors and Company Secretary
The following persons held office as directors of Anatara Lifesciences Ltd during the whole of the
financial year and up to the date of this report, except where otherwise stated:
▶ Dr David Brookes, Executive Chair
▶ Ms Sue MacLeman, Non-Executive Director
▶ Dr Jane Ryan, Non-Executive Director
The following persons held office as company secretary of Anatara Lifesciences Ltd during the whole
of the financial year and up to the date of this report, except where otherwise stated:
▶ Mr Stephen Denaro
Principal activities
The group is developing and commercialising innovative, evidence-based products for
gastrointestinal health where there is significant unmet need. Anatara is a life sciences company with
expertise in developing products for human and animal health.
Dividends - Anatara Lifesciences Ltd
No dividends were declared or paid to members for the year ended 30 June 2022. The directors do not
recommend that a dividend be paid in respect of the financial year.
Review of Operations
Information on the operations and financial position of the group and its business strategies and
prospects is set out in the review of operations and activities on pages 8 to 9 of this annual report.
Financial position
Anatara had cash at bank as at 30 June 2022 of $1.12 million (down from $3.43 million on 30 June 2021).
The Company’s cash position will be bolstered by an anticipated R&D tax incentive of approximately
$480,000 due in September 2022.
Our balance sheet provides scope for us to progress both human trials and pursue initiatives to
partner both our human and animal health assets. In part, this will be determined early in the
financial year by the poultry trial results, which will perhaps provide the final conclusion on the
commercial reality for bromelain-based products in animal husbandry/rearing. Expenditure in
furthering this effort resulted in a loss after tax of $2,532,293 for the year (2021: $1,995,874).
Annual Report 2022 Anatara Lifesciences Ltd
Director’s Report
Page 13
Significant changes in the state of affairs
Significant changes in the state of affairs of the group during the financial year were as follows:
On 5 May 2022, the group announced a leadership change where Mr Steven Lydeamore has resigned
his position as the Chief Executive Officer, effective 24 June 2022 and Dr David Brookes, the group's
Chair, was appointed as the interim Executive Chair.
Events since the end of the financial year
No matter or circumstance has arisen since 30 June 2022 that has significantly affected the group's
operations, results or state of affairs, or may do so in future years.
Likely developments and expected results of operations
Other than the information disclosed in the review of operations and activities, there are no likely
developments or details on the expected results of operations that the group has not disclosed.
Environmental regulation
The group is not affected by any significant environmental regulation in respect of its operations.
Annual Report 2022 Anatara Lifesciences Ltd
Information on Directors
Page 14
Information on directors
The following information is current as at the date of this report:
Dr David Brookes Executive Chair
Experience and
expertise
Other current public
directorships
Former public
directorships in last 3
years
Special responsibilities
Dr. Brookes has extensive experience in the health and
biotechnology industries, first becoming involved in the
biotechnology sector in the late 1990’s as an analyst.
Dr. Brookes has since held Board positions in a number of ASX
listed biotechnology companies, including as Chairman of
genomics solutions company, RHS Ltd, which was acquired by
Perkin Elmer Inc (NYSE: PKI) in June 2018. He has also Chaired the
risk and audit committees in ASX listed companies.
He is currently a Non-Executive Chairman of Dominion Minerals
Limited (ASX:DLM) and a Non-Executive Director of Island
Pharmacuticals (ASX:ILA) and TALI Digital (ASX:TD1). He was
Non-Executive Chairman of the Better Medical group (unlisted)
until the sale of that company to private equity firm Livingbridge in
January 2021.
Dr. Brookes maintains roles as a clinician and as a biotechnology
industry consultant. Dr Brookes, MBBS (Adelaide), is a Fellow of the
Australian College of Rural and Remote Medicine and a Fellow of
the Australian Institute of Company Directors.
Dominion Minerals Limited (ASX: DLM), previously known as Factor
Therapeutics Limited (ASX: FTT), since 10 April 2019.
Tali Digital Ltd (ASX: TD1), since 29 June 2020
Island Pharmaceuticals Limited (ASX:ILA) since October 2020.
None
Chair of Board
Member of the audit and risk management committee
Member of the remuneration and nominations committee
Annual Report 2022 Anatara Lifesciences Ltd
Information on Directors
Page 15
Ms Sue McLeman Non-Executive Director
Experience and
expertise
Other current public
directorships
Former public
directorships in last 3
years
Special responsibilities
Sue MacLeman has more than 30 years’ experience as a
pharmaceutical, biotechnology and medical technology executive
having held senior roles in corporate, medical, commercial and
business development. Sue has served as CEO and Board member
of several ASX, AIM and NASDAQ listed companies in the
healthtech sector.
She is current Chair of MTPConnect a not-for-profit industry growth
centre for the medtech, biotech and pharmaceutical
sectors. She is also Chair TALi Digital Ltd (ASX:TDI), and a
non-executive director of Planet Innovation Holdings and Omico.
Sue is appointed to several academic and government advisory
boards.
Her broad commercial and technical experience is underpinned
by a Bachelor of Pharmacy from the University of Queensland, a
Master of Laws from Deakin University and a Master of Marketing
from Melbourne Business School. She is also a Fellow and Chair of
the Health Forum at the Australian Academy of Technology and
Engineering (ATSE) and Fellow/Graduate of Australian Institute of
Company Directors (AICD).
Tali Digital Ltd (ASX: TD1), since 6 September 2018
Palla Pharma Limited (ASX: PAL), until 21
April 2022 Oventus Medical Ltd (ASX: OVN),
until 14 June 2022
Chair of the audit and risk management committee.
Member of the remuneration and nominations committee.
Annual Report 2022 Anatara Lifesciences Ltd
Information on Directors
Page 16
Dr Jane Ryan Non-Executive Director
Experience and
expertise
Jane has over 30 years of international experience in the
pharmaceutical and biotechnology industries where she has held
executive roles in management of research and development
programs as well as business development and alliance
management. Jane has worked in Australia, the United States and
United Kingdom with companies including Peptech, Roche,
Cambridge Antibody Technology and Biota Holdings.
Throughout her career, she has led many successful fundraising
campaigns and licensing initiatives including the winning of a
$230 million US Government contract.
Jane was Chair of the Advisory Board at the ithree Institute at
the University of Technology Sydney (UTS) which studies how
microbes grow, live, adapt and survive. Jane has been a Board
Member of the government and not for profit organisations and
is currently Non-Executive Director of Bionomics Limited (ASX:
BNO). Since November 2021, Jane was appointed Non-Executive
Director of Robotic Surgery Evolution Ltd.
Other current public
directorships
Bionomics Ltd (ASX:BNO), since 1 October 2020
IDT Australia Limited (ASX: IDT), since 28 January 2022
Former public
directorships in last 3
years
None
Special responsibilities
Member of the audit and risk management committee
Chair of the remuneration and nominations committee.
Annual Report 2022 Anatara Lifesciences Ltd
Information on Directors
Page 17
Company secretary
The company secretary is Mr Stephen Denaro, appointed to the position on 24 February 2014.
Stephen has extensive experience in mergers and acquisitions, business valuations, accountancy
services, and income tax compliance gained from positions as Company Secretary and Chief Financial
Officer of various public companies and with major chartered accountancy firms in Australia and the
United Kingdom. He provides company secretarial services for a number of start-up technology and
ASX listed and unlisted public companies.
Stephen has a Bachelor of Business in accountancy, Graduate Diploma in Applied Corporate
Governance and is a member of the institute of Chartered Accountants in Australia and the
Australian Institute of Company Directors.
Meetings of directors
The numbers of meetings of the company’s board of directors and of each board committee held
during the year ended 30 June 2022, and the numbers of meetings attended by each director were:
A = Number of meetings attended
B = Number of meetings held during the time the director held office or was a member of the committee
during the year
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 18
Remuneration report (audited)
The directors present the Anatara Lifesciences Ltd 2022 remuneration report, outlining key aspects
of our remuneration policy and framework, and remuneration awarded this year.
The report is structured as follows:
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
Key management personnel (KMP) covered in this report
Remuneration policy and link to performance
Elements of remuneration
Link between remuneration and performance
Remuneration expenses
Contractual arrangements with executive KMPs
Non-executive director arrangements
Additional statutory information
(a) Key management personnel covered in this report
Dr David Brookes, Executive Chair
Ms Sue MacLeman, Non-Executive Director
Dr Jane Ryan, Non-Executive Director
Mr Steven Lydeamore, Chief Executive Officer (resigned on 24 June 2022)
Dr Michael West, Chief Operating Officer (resigned on 9 November 2021)
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 19
(b) Remuneration policy and link to performance
Our remuneration and nominations committee is mainly made up of independent non-executive
directors. The committee reviews and determines our remuneration policy and structure annually to
ensure it remains aligned to business needs, and meets our remuneration principles. In particular,
the board aims to ensure that remuneration practices are:
▶ Competitive and reasonable, enabling the company to attract and retain key talent
▶ Aligned to the company’s strategic and business objectives and the creation of shareholder value
▶ Transparent and easily understood, and
▶ Acceptable to shareholders
Assessing performance
The remuneration and nominations committee is responsible for assessing performance against KPIs
and determining the STI and LTI to be paid. To assist in this assessment, the committee
receives data from independently run surveys.
(b) Remuneration policy and link to performance (continued)
Assessing performance (continued)
Performance is monitored on an informal basis throughout the year and a formal evaluation is per-
formed annually.
Securities trading policy
Anatara Lifesciences Ltd’s securities trading policy applies to all directors and executives,
see https://anataralifesciences.com/investors/corporate-governance/
It only permits the purchase or sale of company securities during certain periods.
▶ Product development and commercialisation.
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 20
(c) Elements of remuneration
(i) Fixed annual remuneration (FR)
Key management personnel may receive their fixed remuneration as cash, or cash with
non-monetary benefits such as health insurance and car allowances. FR is reviewed annually, or on
promotion. It is benchmarked against market data for comparable roles in companies in a similar
industry and with similar market capitalisation. The committee aims to position executives at or near
the median, with flexibility to take into account capability, experience, value to the organisation and
performance of the individual.
(ii) Short-term incentives
All executives are entitled to participate in a short-term incentive scheme which provides for
executive employees to receive a combination of short-term incentive (STI) as part of their total
remuneration if they achieve certain performance indicators as set by the board. The STI can be paid
either by cash, or a combination of cash and the issue of equity in the company, at the
determination of the remuneration and nominations committee and board.
The company’s CEO and COO are entitled to short-term incentives in the form of cash bonus up to 40%
and 30% of FR, respectively, against agreed various key performance indicators (KPIs), including target
EBITDA, appreciation in share price value, retention of key talent, and achievement of major project
milestones. On an annual basis, KPIs are reviewed and agreed in advance of each financial year and
include financial and non-financial company and individual performance goals that relate to:
▶ Operational management.
▶ Investor relations and shareholder value creation.
▶ R&D activities.
(iii) Long-term incentives
Executives may also be provided with longer-term incentives through the company’s ‘executive
option plan’ (EOP), that was approved by shareholders at the annual general meeting held on 26
November 2020. The aim of the EOP is to allow executives to participate in, and benefit from, the
growth of the company as a result of their efforts and to assist in motivating and retaining those key
employees over the long-term. Continued service is the condition attached to the vesting of the
options. The board at its discretion determines the total number of options granted to each executive.
(d) Link between remuneration and performance Statutory performance indicators
We aim to align our executive remuneration to our strategic and business objectives and the
creation of shareholder wealth. The table below shows measures of the group’s financial
performance over the last five years as required by the Corporations Act 2001. However, these are not
necessarily consistent with the measures used in determining the variable amounts of
remuneration to be awarded to KMPs. As a consequence, there may not always be a direct
correlation between the statutory key performance measures and the variable remuneration
awarded.
The company’s earnings have remained negative since inception due to the nature of the business.
Shareholder wealth reflects this speculative and volatile market sector. No dividends have ever been
declared by Anatara Lifesciences Ltd. The company continues to focus on revenue growth with the
objective of achieving key commercial milestones in order to add further shareholder value.
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 21
(e) Remuneration expenses
The following tables show details of the remuneration expense recognised for the group’s key
management personnel for the current and previous financial year measured in accordance with the
requirements of the accounting standards.
Notes
1. Cash salary and fees includes estimation of net annual leave entitlement incurred during the current year.
2. Dr David Brookes transitioned from Non-Executive Chair to Executive Chair on 24 June 2022.
3. Mr Steven Lydeamore resigned on 24 June 2022.
4. Dr Michael West resigned on 9 November 2021.
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 22
(e) Remuneration expenses (continued)
Notes
1. Cash salary and fees includes estimation of net annual leave entitlement incurred during the year.
2. Due to COVID-19, Anatara Board resolved to reduce their directors’ fees temporarily from May 2020 to September 2020.
On 22 June 2020, Anatara Board resolved to grant 761,912 options (subject to approval by shareholders at November 2020 AGM)
to KMP and Company Secretary. However, only a total of 617,704 options were subsequently issued on 3 December 2020 given
the shareholders’ approval in the 2020 annual general meeting.
3. Dr Tracie Ramsdale resigned on 26 November 2020 and 68,766 options (total share-based payment expenses of
$258 recognised in prior year) were forfeited during the year.
4. Subsequent to year end, 297,489 performance rights have been issued to Dr Michael West, as part of his
performance bonus of $45,000. These performance rights have nil exercise price and expiring on 23 August 2024.
(f) Contractual arrangements with executive KMPs
Name:
Position:
Contract duration:
Notice period:
Fixed remuneration: $110,000 per annum, plus 10% superannuation
Dr David Brookes
Non-Executive Chair (transitioned to Executive Chair on 24 June 2022)
Unspecified
Unspecified
Mr Steven Lydeamore (resigned on 24 June 2022)
Name:
Chief Executive Officer
Position:
Unspecified
Contract duration:
Notice period:
6 months by either party
Fixed remuneration: $395,000 per annum, plus 10% superannuation
Dr Michael West (resigned on 9 November 2021)
Name:
Chief Operating Officer
Position:
Unspecified
Contract duration:
Notice period:
3 months by either party
Fixed remuneration: $250,000 per annum, plus 10% superannuation
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 23
(g) Non-executive director arrangements
Non-executive directors receive a board fee and fees for chairing but not participating on board
committees, see table below. They do not receive performance-based pay or retirement allowances.
The fees are exclusive of superannuation. The chair receives double the base fee of other
non-executive directors, reflective of the additional demands and responsibilities of this role.
Fees are reviewed annually by the board taking into account comparable roles and market data
provided by the board’s independent remuneration adviser.
The maximum annual aggregate directors’ fee pool limit is $500,000, adopted on initial public
offering of Anatara Lifesciences Ltd on 14 October 2014.
Base fees
Chair
Other non-executive directors
$110,000
$60,000
(h) Additional statutory information
(i) Relative proportions of fixed vs variable remuneration expense
The following table shows the relative proportions of remuneration that are linked to performance
and those that are fixed, based on the amounts disclosed as statutory remuneration expense
on page 22 above:
Notes
1. Dr Tracie Ramsdale resigned on 26 November 2020.
2. Mr Steven Lydeamore resigned on 24 June 2022.
3. Dr Michael West resigned on 9 November 2021.
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 24
(ii) Terms and conditions of the share-based payment arrangements
Options
The terms and conditions of each grant of options affecting remuneration in the current or a future
reporting year are as follows:
(ii)
Terms and conditions of the share-based payment arrangements
(iii) Reconciliation of ordinary shares, performance rights and options held by KMP Share holdings
Share holdings
Notes
1. Balance may include shares held prior to individuals becoming a KMP. For individuals who became a KMP
during the year, the balance is as at the date they became a KMP.
2. Other changes incorporates changes resulting from the acquisition of shares.
3. For a former KMP, the balance is as at the date they cease being a KMP.
4. Dr Michael West resigned on 9 November 2021 and Mr Steven Lydeamore resigned on 24 June 2022
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 25
Option holdings
Notes
1. Balance may include shares held prior to individuals becoming KMP. For individuals who became KMP during the year, the
balance is as at the date they became KMP.
2. Other changes incorporate changes resulting from the expiration/forfeiture of options.
3. For a former KMP, the balance is as at the date they cease being a KMP.
4. Mr Steven Lydeamore resigned on 24 June 2022. Subsequent to the year end, his options have been forfeited on 24 July 2022.
5. Dr Michael West resigned on 9 November 2021. His options were subsequently forfeited 60 days after the
resignation date.
Performance rights
Notes
1. Mr Steven Lydeamore resigned on 24 June 2022.
2. Dr Michael West resigned on 9 November 2021.
(iv) Other transactions with key management personnel
There are no other transactions with key management personnel of Anatara Lifesciences Ltd.
(v) Voting of shareholders at last year’s annual general meeting
Anatara Lifesciences Ltd received more than 75 percent of favourable votes on its remuneration
report for the 2021 financial year. The company did not receive any specific feedback at the 2021
annual general meeting or throughout the year on its remuneration practices.
This concludes the remuneration report, which has been audited.
Annual Report 2022 Anatara Lifesciences Ltd
Remuneration Report
Page 26
Shares under options and performance rights
(a) Unissued ordinary shares
There are no unissued ordinary shares of Anatara Lifesciences Ltd under performance rights at the
date of this report. Unissued ordinary shares of Anatara Lifesciences Ltd under options at the date of
this report are as follows:
No option holder or performance rights holder has any right under the options or performance rights
to participate in any other share issue of the company or any other entity.
(b) Shares issued on the exercise of options or performance rights
No ordinary shares of Anatara Lifesciences Ltd were issued during the year ended 30 June 2022 on
the exercise of options granted. Ordinary shares of Anatara Lifesciences Ltd were issued during the
year ended 30 June 2022 on the exercise of performance rights granted as follows:
Annual Report 2022 Anatara Lifesciences Ltd
Insurance & Indemnities
Page 27
Insurance of officers and indemnities
(a) Insurance of officers
During the financial year, Anatara Lifesciences Ltd paid a premium of $27,500 to insure the directors
and secretaries of the company and its Australian-based controlled entities, and the general
managers of each of the divisions of the group.
The liabilities insured are legal costs that may be incurred in defending civil or criminal proceedings
that may be brought against the officers in their capacity as officers of entities in the group, and any
other payments arising from liabilities incurred by the officers in connection with such proceedings.
This does not include such liabilities that arise from conduct involving a wilful breach of duty by the
officers or the improper use by the officers of their position or of information to gain advantage for
themselves or someone else or to cause detriment to the company. It is not possible to apportion the
premium between amounts relating to the insurance against legal costs and those relating to other
liabilities.
(b) Indemnity of auditors
Anatara Lifesciences Ltd has agreed to indemnify their auditors, Grant Thornton Audit Pty Ltd, to the
extent permitted by law, against any claim by a third party arising from Anatara Lifesciences Ltd’s
breach of their agreement. The indemnity stipulates that Anatara Lifesciences Ltd will meet the full
amount of any such liabilities including a reasonable amount of legal costs.
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.
Non-audit services
The company may decide to employ the auditor on assignments additional to their statutory audit
duties where the auditor’s expertise and experience with the company and/or the group are
important. Details of the amounts paid or payable to the auditor (Grant Thornton Audit Pty Ltd) for
audit and non-audit services provided during the year are set out below.
The board of directors has considered the position and, in accordance with advice received from the
audit committee, is satisfied that the provision of the non-audit services is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001.
The directors are satisfied that the provision of non-audit services by the auditor, as set out below, did
not compromise the auditor independence requirements of the Corporations Act 2001 for the
following reasons:
▶ All non-audit services have been reviewed by the audit committee to ensure they do not
impact the impartiality and objectivity of the auditor.
▶ None of the services undermine the general principles relating to auditor independence as
set out in APES 110 Code of Ethics for Professional Accountants.
Annual Report 2022 Anatara Lifesciences Ltd
Insurance & Indemnities
Page 28
During the year the following fees were paid or payable for non-audit services provided by the auditor
of the parent entity, its related practices and non-related audit firms:
Annual Report 2022 Anatara Lifesciences Ltd
Auditor’s independance declaration
Page 29
Auditor’s independence declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations
Act 2001 is set out on pages 66-68.
Rounding of amounts
The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding
off’ of amounts in the directors’ report. Amounts in the directors’ report have been rounded off in
accordance with the instrument to the nearest dollar.
This report is made in accordance with a resolution of directors.
Dr David Brookes Executive Chair
Melbourne
29 August 2022.
Annual Report 2022 Anatara Lifesciences Ltd
Corporate Governance statement
Page 30
Corporate governance statement
Anatara Lifesciences Ltd and the board are committed to achieving and demonstrating the highest
standards of corporate governance. Anatara Lifesciences Ltd has reviewed its corporate governance
practices against the Corporate Governance Principles and Recommendations (4th edition)
published by the ASX Corporate Governance Council.
The 2022 corporate governance statement is dated as at 30 June 2022 and reflects the corporate
governance practices in place throughout the 2022 financial year.
A description of the group’s current corporate governance practices is set out in the group’s
corporate governance statement which can be viewed at:
https://anataralifesciences.com/investors/corporate-governance/
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 31
Financial Statements
Consolidated statement of profit or loss and other comprehensive income ____________ 32
Consolidated statement of financial position _________________________________________ 33
Consolidated statement of changes in equity ________________________________________ 34
Consolidated statement of cash flows (direct method) _______________________________ 35
Notes to the financial statements _____________________________________________________36
Directors’ declaration_________________________________________________________________ 65
These financial statements are consolidated financial statements for the group consisting of
Anatara Lifesciences Ltd and its subsidiaries. A list of major subsidiaries is included in note 12.
The financial statements are presented in the Australian currency.
Anatara Lifesciences Ltd is a company limited by shares, incorporated and domiciled in Australia.
Its registered office and principal place of business is:
Level 3, 62 Lygon Street Carlton South VIC 3053
The financial statements were authorised for issue by the directors on 29 August 2022.
The directors have the power to amend and reissue the financial statements.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 32
Consolidated statement of profit or loss and other comprehensive income
For the year ended 30 June 2022
The above consolidated statement of profit or loss should be read in conjunction with
the accompanying notes.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 33
Consolidated statement of financial position
As at 30 June 2022
The above consolidated statement of financial position should be read in conjunction with
the accompanying notes.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 34
Consolidated statement of changes in equity
For the year ended 30 June 2022
Attributable to the owners
of Anatara Lifesciences Ltd
Attributable to the owners
of Anatara Lifesciences Ltd
The above consolidated statement of changes in equity should be read in conjunction with
the accompanying notes.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 35
Consolidated statement of cash flows
The above consolidated statement of cash flows should be read in conjunction with
the accompanying notes.
Annual Report 2022 Anatara Lifesciences Ltd
Contents Financial Statements
Page 36
Contents of the notes to the financial statements
Page
1
2
3
4
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
Segment information
Other income and expense items
Income tax expense
Financial assets and financial liabilities
Equity
Cash flow information
Critical estimates, judgements and errors
Financial risk management
Capital management
Interests in other entities
Contingent liabilities
COVID-19 impact on business
Events occurring after the reporting period
Related party transactions
Share-based payments
Remuneration of auditors
Loss per share
Parent entity financial information
Summary of significant accounting policies
37
38
43
45
46
49
49
50
50
51
53
54
37
39
46
50
50
55
56
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 37
1. Segment information
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. The chief operating decision maker, who is responsible for allocating
resources and assessing performance of the operating segments, has been identified as the
Chief Executive Officer and Executive Chair of Anatara Lifesciences Ltd.
The group has identified one reportable segment; that is, the research, development of oral solutions
for gastrointestinal diseases and the commercialisation of the Detach® diarrhea treatment for piglets.
The segment details are therefore fully reflected in the body of the financial statements.
2. Other income and expense items
(a) Other income
(i) R&D tax incentive
The group’s research and development (R&D) activities are eligible under an Australian government
tax incentive for eligible expenditure. Management has assessed these activities and expenditure to
determine which are likely to be eligible under the incentive scheme. Amounts are recognised when
it has been established that the conditions of the tax incentive have been met and that the expected
amount can be reliably measured.
For the year ended 30 June 2022, the group has recognised a receivable of $479,984 offset by an over-
estimation from the prior period of $11,469 (2021: $1,023,028).
(ii) Fair value of EMDG and COVID-19 government assistance
The group’s other grant income is recognised when compliance with the conditions attached to the
grant have been determined and the group has ascertained the grant will be received.
For the year ended 30 June 2022, the group has not recognised other grant income (2021: $85,000).
The Group has not recognised Export Market Development Grant (EMDG) (2021: $47,500) in other
income. This is a key Australian Government financial assistance program for aspiring current
exporters.
No further COVID-19 government assistance was recognised in other income for current financial
year (2021: $37,500). This was mainly “Cashflow boost for employers” measure announced as part of
the Australian Government’s economic stimulus package.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 38
2. Other income and expense items (continued)
(b) Breakdown of expenss by nature
3. Income tax expense
(a) Numerical reconciliation of income tax expense to prima facie tax payable
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 39
3. Income tax expense (continued)
(b) Tax losses
Unused tax losses can be carried forward indefinitely subject to continuity of ownership and
same business test rules.
4. Financial assets and financial liabilities
(a) Cash and cash equivalents
(i) Reconciliation to cash flow statement
The above figures reconcile to the amount of cash shown in the consolidated statement of cash
flows at the end of the financial year as follows:
(ii) Classification as cash equivalents
Term deposits are presented as cash equivalents if they have a maturity of three months or less
from the date of acquisition and are repayable with 24 hours notice with no loss of interest.
See note 21(i) for the group’s other accounting policies on cash and cash equivalents.
(iii) Risk exposure
The group’s exposure to interest rate risk is discussed in note 10. The maximum exposure to
credit risk at the end of the reporting period is the carrying amount of each class of cash and
cash equivalents mentioned above.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 40
4. Financial assets and financial liabilities (continued)
(b) Trade and other receivables
(i) Accrued receivables
Accrued receivables include $479,984 from the Australian Taxation Office in relation to the R&D tax
incentive (2021: $747,946). In prior year, accrued receivables also included $570 in relation to interest
income.
(ii) Fair value of trade and other receivables
Due to the short-term nature of the current receivables, their carrying amount is considered to be the
same as their fair value.
(c) Trade and other payables
Trade payables are unsecured and are usually paid within 30 days of recognition. The carrying
amounts of trade and other payables are considered to be the same as their fair values, due to their
short-term nature.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 41
5. Employee benefit obligations
(i) Leave obligations
The leave obligations cover the group’s liabilities for long service leave and annual leave which are
classified as either other long-term benefits or short-term benefits, as explained in note 21(m).
The current portion of this liability includes all of the accrued annual leave, the unconditional
entitlements to long service leave where employees have completed the required year of service and
also for those employees that are entitled to pro-rata payments in certain circumstances.
The majority of leave provision is presented as current, being $35,534 (2021: $53,037), since the group
does not have an unconditional right to defer settlement for any of these obligations.
However, based on past experience, the group does not expect all employees to take the full amount
of accrued leave or require payment within the next 12 months.
6. Leases
(i) Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 42
(ii) Amounts recognised in the statement of profit or loss
The statement of profit or loss shows the following amounts relating to leases:
(iii) The group’s leasing activities and how these are accounted for
In June 2021 the group entered into a two-year commercial lease in North Melbourne.
The lease is for the use of office facilities. This lease includes an extension option for a further 2 years.
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the
leased asset is available for use by the group.
Each lease payment is allocated between the liability and finance cost. The finance cost is charged to
profit or loss over the lease year so as to produce a constant periodic rate of interest on the remaining
balance of the liability for each year. The right-of-use asset is depreciated over the shorter of the
asset’s useful life and the lease term on a straight-line basis.
Assets and liabilities arising from a lease are initially measured on a present value basis.
Lease liabilities include the net present value of the following lease payments:
▶ Fixed payments (including in-substance fixed payments), less any lease incentives receivable
▶ Variable lease payment that are based on an index or a rate
▶ Amounts expected to be payable by the lessee under residual value guarantees
▶ The exercise price of a purchase option if the lessee is reasonably certain to exercise that
option, and
▶ Payments of penalties for terminating the lease, if the lease term reflects the lessee
exercising that option
The lease payments are discounted using the interest rate implicit in the lease, if that rate can be
determined, or the group’s incremental borrowing rate.
Right-of-use assets are measured at cost or fair value, comprising the following:
▶ The amount of the initial measurement of lease liability
▶ Any lease payments made at or before the commencement date, less any lease incentives
received
▶ Any initial direct costs, and
▶ Restoration costs
Payments associated with short-term leases are recognised on a straight-line basis as an expense in
profit or loss. Short-term leases are leases with a lease term of 12 months or less.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 43
7. Equity
(a) Share capital
(i) Movements in ordinary shares:
Below is the movement in ordinary shares in the year ended 30 June 2022:
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 44
7. Equity (continued)
(ii) Ordinary shares
Ordinary shares entitle the holder to participate in dividends, and to share in the proceeds of
winding up the company in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is
entitled to one vote, and upon a poll each share is entitled to one vote. Ordinary shares have no
par value and the company does not have a limited amount of authorised capital.
(iii) Options and performance rights
Information relating to options and performance rights, including details of those issued, exercised
and lapsed during the financial year and the outstanding balance as at the end of the reporting year
is set out in note 7(b).
(b) Other reserves
The consolidated statement of financial position line item ‘other reserves’ comprises the
‘share-based payments reserve’.
(i) Nature and purpose of other reserves Share-based payments
The share-based payment reserve records items recognised as expenses on valuation of share
options and performance rights issued to key management personnel, other employees and
eligible contractors.
(ii) Movement in options and performance rights
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 45
8. Cash flow information
(a) Reconciliation of profit/(loss) after income tax to net cash inflow from operating activities
(b) Non-cash investing and financing activities
Non-cash investing and financing activities disclosed in other notes are:
▶ Options/performance rights issued for no cash consideration - note 17.
9. Critical estimates, judgements and errors
The preparation of financial statements requires the use of accounting estimates which, by definition,
will seldom equal the actual results. Management also needs to exercise judgement in applying the
group’s accounting policies.
This note provides an overview of the areas that involved a higher degree of judgement or complexity,
and of items which are more likely to be materially adjusted due to estimates and assumptions
turning out to be wrong. Detailed information about each of these estimates and judgements is
included in other notes together with information about the basis of calculation for each affected line
item in the financial statements. In addition, this note also explains where there have been actual
adjustments this year as a result of an error and of changes to previous estimates.
(a) Significant estimates and judgements
The areas involving significant estimates or judgements are:
▶ Estimation of R&D tax incentive income accrual - note 2(a)(i).
Management has used judgements to assess the group’s eligible research and development (R&D)
activities and eligible expenditure under the incentive scheme. The determination of the eligible R&D
activities and eligible expenditure would affect the expected amounts recognised for R&D tax
incentive. The R&D tax incentive refund would provide an important source of funding and enables
the group to progress the development and commercialisation of our GaRP product.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 46
9. Critical estimates, judgements and errors (continued)
(a) Significant estimates and judgements (continued)
▶ Estimation of share-based payments - note 17.
Management has used judgements to assess the group’s share-based payments by determining the
choice of option pricing model. The choice of model would result in option valuation that requires
various underlying assumptions to determine the fair value of options at grant date.
Management used the Black-Scholes option pricing model that takes into account the exercise price,
term of the option, security price at grant date and expected price volatility of the underlying security,
the expected dividend yield, the risk-free interest rate for the term of the security and certain prob-
ability assumptions as all these inputs would affect the share-based payments valuation. The share-
based payments are long-term incentives which allow executives to participate in, and benefit from,
the growth of the group as a result of their efforts and to assist in motivating and retaining those key
employees over the long-term.
Estimates and judgements are continually evaluated. They are based on historical experience and
other factors, including expectations of future events that may have a financial impact on the entity
and that are believed to be reasonable under the circumstances.
10. Financial risk management
This note explains the group’s exposure to financial risks and how these risks could affect the group’s
future financial performance. The group’s risk management is predominantly controlled by the
board. The board monitors the group’s financial risk management policies and exposures and
approves substantial financial transactions. It also reviews the effectiveness of internal controls
relating to market risk, credit risk and liquidity risk.
(a)
Market risk
(i) Foreign exchange risk
The majority of the company’s operations are denominated in Australian dollars, with the few
exceptions on services acquired from overseas suppliers but at a marginally insignificant amount and
frequency. Therefore, management has concluded that market risk from foreign exchange
fluctuation is not material.
(ii) Cash flow and fair value interest rate risk
The group’s main interest rate risk arises from cash and cash equivalents and other financial assets at
amortised cost (deposits at call) held, which expose the group to cash flow interest rate risk. During
2022 and 2021, the group’s cash and cash equivalents and deposits at call at variable rates were
denominated in Australian dollars.
The group’s exposure to interest rate risk at the end of the reporting year, expressed in Australian
dollars, was as follows:
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 47
10. Financial risk management (continued)
(a) Market risk (continued)
Sensitivity
Profit or loss is sensitive to higher/lower interest income from cash and cash equivalents as a result of
changes in interest rates.
The use of 1.21 percent (2021: 0.31 percent) was determined based on analysis of the Reserve Bank of
Australia cash rate change, on an absolute value basis, at 30 June 2022 and the previous four balance
dates. The average cash rate at these balance dates was 0.77 percent (2021: 0.93 percent).
The average change to the cash rate between balance dates was 157.03 percent (2021: 33.88 percent).
By multiplying these two values, the interest rate risk was derived. Loss is more sensitive to
movements in interest rates in 2022 than 2021 due to increased cash and cash equivalents and
deposits at call as well as low interest rate. The group’s exposure to other classes of financial
instruments with cash flow risk is not material.
(b) Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by
counterparties of contract obligations that could lead to a financial loss to the group.
(i) Risk management
The company manages credit risk and the losses which could arise from default by ensuring that
financial assets such as cash at bank and deposits at call are held with reputable organisations.
(ii) Impairment of financial assets
While cash and cash equivalents and term deposits are subject to the impairment requirements of
AASB 9, the identified impairment loss was immaterial.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 48
(c) Liquidity risk
Liquidity risk arises from the possibility that the group might encounter difficulty in settling its
debts or otherwise meeting its obligations related to financial liabilities. The group manages this risk
through the following mechanisms:
▶ preparing forward looking cash flow analyses in relation to its operating, investing and
financing activities;
▶ obtaining funding from a variety of sources;
▶ maintaining a reputable credit profile;
▶ managing credit risk related to financial assets;
▶ investing cash and cash equivalents and deposits at call with major financial institutions; and
▶ comparing the maturity profile of financial liabilities with the realisation profile of financial
assets.
(i) Maturities of financial liabilities
The tables below analyse the group’s financial liabilities into relevant maturity groupings based on
their contractual maturities. The amounts disclosed in the table are the contractual undiscounted
cash flows.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 49
11. Capital management
(a) Risk management
The group’s objectives when managing capital are to:
▶ safeguard their ability to continue as a going concern, so that they can continue to provide
returns for shareholders and benefits for other stakeholders, and
▶ maintain an optimal capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the group may issue new shares or reduce its
capital, subject to the provisions of the group’s constitution. The capital structure of the group consists
of equity attributed to equity holders of the group, comprising contributed equity, reserves and
accumulated losses. By monitoring undiscounted cash flow forecasts and actual cash flows provided to
the board by the group’s management, the board monitors the need to raise additional equity from
the equity markets.
As at 30 June 2022, the group held cash and equivalents of $1,120,204.
The group has put in place measures to reduce all non-critical expenditure.
(b) Dividends
No dividends were declared or paid to members for the year ended 30 June 2022 (2021: nil).
The group’s franking account balance was nil at 30 June 2022 (2021: nil).
12. Interests in other entities
(a) Subsidiaries
The group’s principal subsidiaries at 30 June 2022 are set out below. Unless otherwise stated, they have
share capital consisting solely of ordinary shares that are held directly by the group, and the proportion
of ownership interests held equals the voting rights held by the group. The country of incorporation or
registration is also their principal place of business.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 50
13. Contingent liabilities
The group had no contingent liabilities at 30 June 2022 (2021: nil).
14. COVID Impact on Business
Anatara Lifesciences remains committed to its corporate strategy and focused on delivering on its
anticipated milestones during the year ahead. However, the Company is actively planning for
disruptions that may lead to delays in meeting some of these objectives.
Anatara employees have been able to continue laboratory-based activities and as a result have
advanced GaRP to being clinical trial ready. In addition, new bromelain-based formulations were
developed for challenge trials in piglets (in-feed) and in poultry.
15. Events occurring after the reporting period
No matter or circumstance has occurred subsequent to year end that has significantly affected, or
may significantly affect, the operations of the group, the results of those operations or the state of
affairs of the group or economic entity in subsequent financial years.
16. Related party transactions
(a) Subsidiaries
Interests in subsidiaries are set out in note 12(a).
(b) Key management personnel compensation
(c) Transactions with other related parties
During the current financial year, the group engaged a related party (Planet Innovation) for
consulting services which amounted to $28,340 (2021: nil). These transactions were conducted at
arm’s length.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 51
17. Share-based payments
(a) Executive option plan
The establishment of the ‘executive option plan’ (EOP) was approved by shareholders at the 2020
annual general meeting. The plan is designed to provide long-term incentives for executives
(including directors) to deliver long-term shareholder returns. Participation in the plan is at the
board’s discretion and no individual has a contractual right to participate in the plan or to receive
any guaranteed benefits. Set out below are summaries of options granted under the plan:
The forfeited/lapsed options were fully vested before they forfeited/lapsed.
Share options outstanding at the end of the year have the following expiry date and exercise prices:
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 52
(i) Vesting conditions
Vesting condition apply to options granted under the executive option plan (EOP). Shares are not be
issued unless the vesting condition is met. The vesting condition generally
depends on service periods of the employees or directors. If the vesting condition is not met on the
relevant vesting date, the options lapse and the option holders are not issued any shares. The vesting
condition that apply to the options offered are set out in the options offer letter and the EOP.
(ii) Fair value of options granted
The value attributed to options issued is an estimate calculated using an appropriate
mathematical formula based on an option pricing model. The choice of models and the
resultant option value require assumptions to be made in relation to the likelihood and
timing of the conversion of the options to shares and the value and volatility of the price of the
underlying shares.
Management has assessed the fair value of options determined at grant date, using the Black-Scholes
option pricing model that takes into account the exercise price, term of the option, security price at
grant date and expected price volatility of the underlying security, the expected dividend yield, the
risk-free interest rate for the term of the security and certain probability assumptions.
The model inputs for options granted under EOP during the year ended 30 June 2022
included:
(b) Expenses arising from share-based payment transactions
Total expenses arising from share-based payment transactions re
cognised during the year were as follows:
1It was agreed that performance pay for selected employees for the year ended 30 June 2022 would be
paid in performance rights rather than cash. Performance rights to be issued to employees are
long-term incentives under the Executive Option Plan (EOP). However, the performance rights for the
current financial year have not been granted as at 30 June 2022.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 53
18. Remuneration of auditors
During the year the following fees were paid or payable for services provided by the auditor of the
parent entity, its related practices and non-related audit firms:
(a) Grant Thornton Audit Pty Ltd
(i) Audit and other assurance services
It is the group’s policy to employ Grant Thornton Audit Pty Ltd on assignments additional to their
statutory audit duties where Grant Thornton Audit Pty Ltd’s expertise and experience with the group
are important. These assignments are principally tax advice.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 54
19. Loss per share
On the basis of the group's losses, the outstanding options as at 30 June 2022 are considered to be
anti-dilutive and therefore were excluded from the diluted weighted average number of ordinary
shares calculation.
Annual Report 2022 Anatara Lifesciences Ltd
Financial Statements
Page 55
20. Parent entity financial information
(a) Summary financial information
The individual financial statements for the parent resemble the consolidated financial statements as
the company’s subsidiary, Sarantis Pty Ltd is a dormant entity.
(b) Guarantees entered into by the parent entity
The parent entity has not entered into any guarantees in relation to debts of its subsidiaries in the year
ended 30 June 2022 (2021: nil).
(c) Contingent liabilities of the parent entity
The parent entity did not have any contingent liabilities as at 30 June 2022 or 30 June 2021.
(d) Contractual commitments for the acquisition of property, plant or equipment
The parent entity has not entered into any contractual commitments for the acquisition of property,
plant or equipment in the year ended 30 June 2022 (2021: nil).
(e) Determining the parent entity financial information
The financial information for the parent entity has been prepared on the same basis as the
consolidated financial statements, except as set out below.
(i) Investments in subsidiaries
Investments in subsidiaries are accounted for at cost in the financial statements of Anatara
Lifesciences Ltd.
(ii) Tax consolidation legislation
Anatara Lifesciences Ltd and its wholly-owned Australian controlled entities have implemented the
tax consolidation legislation. The head entity, Anatara Lifesciences Ltd, and the controlled entities
in the tax consolidated group 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. In addition to its own current and deferred tax amounts, Anatara
Lifesciences Ltd also recognises the current tax liabilities (or assets) and the deferred tax assets arising
from unused tax losses and unused tax credits assumed from controlled entities in the tax
consolidated group.
The entities have also entered into a tax funding agreement under which the wholly-owned entities
fully compensate Anatara Lifesciences Ltd for any current tax payable assumed and are
compensated by Anatara Lifesciences Ltd for any current tax receivable and deferred tax assets
relating to unused tax losses or unused tax credits that are transferred to Anatara Lifesciences Ltd
under the tax consolidation legislation. The funding amounts are determined by reference to the
amounts recognised in the wholly-owned entities’ financial statements.
The amounts receivable/payable under the tax funding agreement are due upon receipt of the
funding advice from the head entity, which is issued as soon as practicable after the end of each
financial year. The head entity may also require payment of interim funding amounts to assist with its
obligations to pay tax instalments. Assets or liabilities arising under tax funding agreements with the
tax consolidated entities are recognised as current amounts receivable from or payable to other
entities in the group. Any difference between the amounts assumed and amounts receivable or
payable under the tax funding agreement are recognised as a contribution to (or distribution from)
wholly-owned tax consolidated entities.
Annual Report 2022 Anatara Lifesciences Ltd
Contents summary of
accounting policies
Page 56
Contents of the summary of significant accounting policies
Page
(a)
(b)
(c)
(d)
(e)
(f)
(g)
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(o)
(p)
(q)
(r)
59
59
57
58
58
58
58
Basis of preparation
Principles of consolidation
Segment reporting
Foreign currency translation
Government grants
Income tax
Leases
Impairment of non-financial assets 59
60
Cash and cash equivalents
60
Trade receivables
60
Financial assets
61
Trade and other payables
63
Employee benefits
Contributed equity
64
Dividends
Loss per share
Rounding of amounts
Goods and services tax (GST)
64
64
64
64
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 57
21. Summary of significant accounting policies
This note provides a list of the significant accounting policies adopted in the preparation of these
consolidated financial statements to the extent they have not already been disclosed in the other
notes above. These policies have been consistently applied to all the years presented, unless otherwise
stated. The financial statements are for the group consisting of Anatara Lifesciences Ltd and its
subsidiaries.
(a) Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian
Accounting Standards and Interpretations issued by the Australian Accounting Standards Board and
the Corporations Act 2001. Anatara Lifesciences Ltd is a for-profit entity for the purpose of preparing
the financial statements.
(i) Compliance with IFRS
The consolidated financial statements of the Anatara Lifesciences Ltd group also comply with
International Financial Reporting Standards (IFRS) as issued by the International Accounting
Standards Board (IASB).
(ii) Historical cost convention
The financial statements have been prepared on a historical cost basis.
(iii) Going concern
The financial statements have been prepared on the going concern basis, which contemplates
continuity of normal business activities and the realisation of assets and settlement of liabilities in
the normal course of business. As disclosed in the financial statements, the group incurred a loss of
$2,532,293 and had operating cash outflows of $2,232,876 for the year ended 30 June 2022.
As at 30 June 2022, the group’s held cash and cash equivalents of $1,120,204. In the process of
approving the group’s internal forecast and business plan for upcoming financial years, the board has
considered the cash position of the group within the next 12 months from the date of this report. The
group’s internal forecast and business plan for the upcoming financial year includes capital raising.
The directors are confident that the company could raise additional capital to meet the group’s
contractual commitments and working capital requirements. Notwithstanding the uncertainty over
either of these events occurring, based on the above considerations the board has assessed the
resources and opportunities available to the group, and consequently believe that the group will be
able to repay its debts as and when they fall due and are of the opinion that the financial statements
have been appropriately prepared on a going concern basis.
In the event that these measures are unsuccessful, there would be a material uncertainty which may
cast significant doubt as to whether the consolidated entity will continue as a going concern and
therefore whether it will realise its assets and extinguish its liabilities in the normal course of business
and at the amounts stated in the financial report.
The financial report does not include any adjustments related to the amounts or classification of
recorded assets or liabilities that might be necessary if the consolidated entity does not continue as a
going concern.
However, Anatara employees have been able to continue laboratory-based activities and as a result
have advanced GaRP to being clinical trial ready. In addition, new bromelain-based formulations were
developed for challenge trials in piglets (in-feed) and in poultry.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 58
(a) Basis of preparation (continued)
(iv)
New and amended standards adopted by the group
The group has adopted all of the new or amended Accounting Standards and Interpretations issued
by the Australian Accounting Standards Board (‘AASB’) that are mandatory for the current reporting
period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not
been early adopted.
(b) Principles of consolidation
(i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the group has control.
The group controls an entity when the group is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those returns through its power to direct the
activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred
to the group. They are deconsolidated from the date that control ceases. The acquisition method of
accounting is used to account for business combinations by the group.
Intercompany transactions, balances and unrealised gains on transactions between group companies
are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of an
impairment of the transferred asset. Accounting policies of subsidiaries have been changed where
necessary to ensure consistency with the policies adopted by the group.
(c) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the
chief operating decision maker. This has been identified as the chief executive officer and executive
chair.
(d) Foreign currency translation
(i) Functional and presentation currency
Items included in the financial statements of each of the group’s entities are measured using the
currency of the primary economic environment in which the entity operates (‘the functional
currency’). The consolidated financial statements are presented in Australian dollar ($), which is
Anatara Lifesciences Ltd’s functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of
such transactions and from the translation of monetary assets and liabilities denominated in foreign
currencies at year end exchange rates are generally recognised in profit or loss.
Foreign exchange gains and losses that relate to borrowings are presented in the consolidated
income statement, within finance costs. All other foreign exchange gains and losses are presented in
the consolidated income statement on a net basis within other gains/(losses).
(e) Government grants
Transactions involving government grants received are accounted for by applying AASB 120
Government Grants. Grants from the government are recognised at their fair value where there is a
reasonable assurance that the grant will be received and the group will comply with all attached
conditions. Note 2 provides further information on how the group accounts for government grants.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 59
(f) Income tax
The income tax expense or credit for the year is the tax payable on the current year’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.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively
enacted at the end of the reporting year in the countries where the company and its subsidiaries and
associates operate and generate taxable income. Management periodically evaluates positions taken
in tax returns with respect to situations in which applicable tax regulation is subject to interpretation.
It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax
authorities.
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 in the consolidated
financial statements. However, deferred tax liabilities are not recognised if they arise from the initial
recognition of goodwill. Deferred income tax is also 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 end of the reporting year 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 only if it is probable that future taxable amounts will be available
to utilise those temporary differences and losses. Current and deferred tax is recognised in profit or
loss, except to the extent that it relates to items recognised in other comprehensive income or direct-
ly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity,
respectively.
(g) Leases
With the exception of short-term, low value and immaterial leases, right-of-use assets and
corresponding lease liabilities are recognised in the statement of financial position. Straight-line
operating lease expense recognition is replaced with a depreciation charge for the right-of-use
assets (included in operating costs) and an interest expense on the recognised lease liabilities
(included in finance costs).
Payments associated with short-term leases, low value and immaterial leases are recognised on a
straight-line basis as an expense in profit or loss. Short-term leases are leases with a lease term of 12
months or less.
(h) Impairment of non-financial assets
Intangible 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 of disposal 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). Non-financial assets other than goodwill that suffered an
impairment are reviewed for possible reversal of the impairment at the end of each reporting year.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 60
(i) Cash and cash equivalents
For the purpose of presentation in the consolidated statement of cash flows, cash and cash
equivalents includes cash on hand, deposits held at call with financial institutions, other short-term,
highly liquid investments with original maturities of three months or less that are readily convertible
to known amounts of cash and which are subject to an insignificant risk of changes in value, and
bank overdrafts. Bank overdrafts are
shown within borrowings in current liabilities in the consolidated statement of financial position.
(j) Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost
using the effective interest method, less loss allowance. See note 4(b) for further information about
the group’s accounting for trade receivables and note 10(b) for a description of the group’s
impairment policies.
(k) Financial assets
(i) Classification
The group classifies its financial assets in the following measurement categories:
▶ those to be measured subsequently at fair value (either through OCI or through profit or
loss), and
▶ those to be measured at amortised cost.
The classification depends on the entity’s business model for managing the financial assets and the
contractual terms of the cash flows. For assets measured at fair value, gains and losses will either be
recorded in profit or loss or OCI. For investments in equity instruments that are not held for trading,
this will depend on whether the group has made an irrevocable election at the time of initial
recognition to account for the equity investment at fair value through other comprehensive income
(FVOCI).
(ii) Recognition and derecognition
Regular way purchases and sales of financial assets are recognised on trade-date, the date on which
the group commits to purchase or sell the asset. Financial assets are derecognised when the rights to
receive cash flows from the financial assets have expired or have been transferred and the group has
transferred substantially all the risks and rewards of ownership.
(iii)
Measurement
At initial recognition, the group measures a financial asset at its fair value plus, in the case of a
financial asset not at fair value through profit or loss (FVPL), transaction costs that are directly
attributable to the acquisition of the financial asset. Transaction costs of financial assets carried at
FVPL are expensed in profit or loss.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 61
Debt instruments
Subsequent measurement of debt instruments depends on the group’s business model for
managing the asset and the cash flow characteristics of the asset. There are three measurement
categories into which the group classifies its debt instruments:
▶ Amortised cost: Assets that are held for collection of contractual cash flows where those cash flows
represent solely payments of principal and interest are measured at amortised cost. Interest income
from these financial assets is included in finance income using the effective interest rate method.
Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in other
gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as
separate line item in the consolidated income statement.
▶ FVOCI: Assets that are held for collection of contractual cash flows and for selling the financial
assets, where the assets’ cash flows represent solely payments of principal and interest, are measured
at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of
impairment gains or losses, interest income and foreign exchange gains and losses which are
recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss
previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/
(losses). Interest income from these financial assets is included in finance income using the effective
interest rate method. Foreign exchange gains and losses are presented in other gains/(losses) and
impairment expenses are presented as separate line item in the consolidated income statement.
▶ FVPL: Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL.
A gain or loss on a debt investment that is subsequently measured at FVPL is recognised in profit or
loss and presented net within other gains/(losses) in the year in which it arises.
(k) Financial assets (continued)
(iv) Impairment
The group assesses on a forward looking basis the expected credit losses associated with its debt
instruments carried at amortised cost and FVOCI. The impairment methodology applied depends on
whether there has been a significant increase in credit risk.
(v) Income recognition Interest income
Interest income is recognised using the effective interest method. When a receivable is impaired, the
group reduces the carrying amount to its recoverable amount, being the estimated future cash flow
discounted at the original effective interest rate of the instrument, and continues unwinding the dis-
count as interest income. Interest income on impaired loans is recognised using the original effective
interest rate.
(l) Trade and other payables
These amounts represent liabilities for goods and services provided to the group prior to the end of
financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of
recognition. Trade and other payables are presented as current liabilities unless payment is not due
within 12 months after the reporting year. They are recognised initially at their fair value and
subsequently measured at amortised cost using the effective interest method.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 62
(m) Employee benefits
(i) Short-term obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating
sick leave that are expected to be settled wholly within 12 months after the end of the year in which
the employees render the related service are recognised in respect of employees’ services up to the
end of the reporting year and are measured at the amounts expected to be paid when the liabilities
are settled. The liabilities are presented as current employee benefit obligations in the balance sheet.
(ii) Other long-term employee benefit obligations
The group also has liabilities for long service leave and annual leave that are not expected to be
settled wholly within 12 months after the end of the year in which the employees render the related
service. These obligations are therefore measured as the present value of expected future payments
to be made in respect of services provided by employees up to the end of the reporting year using
the projected unit credit method. Consideration is given to expected future wage and salary levels,
experience of employee departures and years of service.
Expected future payments are discounted using market yields at the end of the reporting year of
high-quality corporate bonds with terms and currencies that match, as closely as possible, the
estimated future cash outflows. Remeasurements as a result of experience adjustments and changes
in actuarial assumptions are recognised in profit or loss.
The obligations are presented as current liabilities in the balance sheet if the entity does not have an
unconditional right to defer settlement for at least twelve months after the reporting year, regardless
of when the actual settlement is expected to occur.
(iii) Share-based payments
Share-based compensation benefits are provided to employees via the ‘employee option plan’ (EOP).
Information relating to these schemes is set out in note 17.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 63
(m) Employee benefits (continued)
Employee options
The fair value of options granted under the EOP is recognised as a share-based payment expense with
a corresponding increase in equity. The total amount to be expensed is determined by reference to the
fair value of the options granted:
▶ including any market performance conditions (e.g. the company’s share price)
▶ excluding the impact of any service and non-market performance vesting conditions (e.g.
profitability, sales growth targets and remaining an employee of the company over a specified
time year), and
▶ including the impact of any non-vesting conditions (e.g. the requirement for employees to
save or holdings shares for a specific year of time).
The total expense is recognised over the vesting year, which is the year over which all of the specified
vesting conditions are to be satisfied. At the end of each year, the entity revises its estimates of the
number of options that are expected to vest based on the non-market vesting and service conditions.
It recognises the impact of the revision to original estimates, if any, in profit or loss, with a
corresponding adjustment to equity.
Annual Report 2022 Anatara Lifesciences Ltd
Accounting policies
Page 64
Performance rights
Performance pay for selected employees of the group would be paid in performance rights rather
than cash, subject to board approval. Performance rights to be issued to employees are long-term
incentives under the Executive Option Plan (EOP).
(n) Contributed equity
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.
(o) 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 reporting year but not distributed at
the end of the reporting year.
(p) Loss per share
(i) Basic loss per share
Basic loss per share is calculated by dividing:
▶ the loss attributable to owners of the company, excluding any costs of servicing equity other
than ordinary shares
▶ by the weighted average number of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued during the year.
(ii) Diluted loss per share
Diluted loss per share adjusts the figures used in the determination of basic loss 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 additional ordinary shares that would have been
outstanding assuming the conversion of all dilutive potential ordinary shares.
(q) Rounding of amounts
The company is of a kind referred to in ASIC Legislative Instrument 2016/191, relating to the ‘rounding
off’ of amounts in the financial statements. Amounts in the financial statements have been rounded
off in accordance with the instrument to the nearest dollar.
(r) Goods and services tax (GST)
Revenues, expenses and assets are recognised net of the amount of associated 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 consolidated 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.
Annual Report 2022 Anatara Lifesciences Ltd
Director’s Declaration
Page 65
In the directors’ opinion:
(a) the financial statements and notes set out on pages 32 to 56 are in accordance with the
Corporations Act 2001, including:
(i) complying with Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting requirements, and
(ii) giving a true and fair view of the consolidated entity’s financial position as at 30 June
2022 and of its performance for the financial year ended on that date, and
(b) there are reasonable grounds to believe that the company will be able to pay its debts as and
when they become due and payable.
Note 21(a) confirms that the financial statements also comply with International Financial
Reporting Standards as issued by the International Accounting Standards Board.
The directors have been given the declarations by the chief executive officer and chief financial
officer required by section 295A of the Corporations Act 2001.
This declaration is made in accordance with a resolution of directors.
Dr David Brookes Executive Chair
Melbourne
29 August 2022
Annual Report 2022 Anatara Lifesciences Ltd
Independant Auditor’s Report
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Annual Report 2022 Anatara Lifesciences Ltd
Independant Auditor’s Report
Page 67
Annual Report 2022 Anatara Lifesciences Ltd
Independant Auditor’s Report
Page 68
Annual Report 2022 Anatara Lifesciences Ltd
Shareholder Information
Page 69
The shareholder information set out below was applicable as at 13 September 2022.
There were 301 holders of less than a marketable parcel of ordinary shares.
B. Equity security holders
Twenty largest quoted equity security holders
The names of the twenty largest holders of quoted equity securities are listed below:
Annual Report 2022 Anatara Lifesciences Ltd
Shareholder Information
Page 70
B. Equity security holders (continued)
Unquoted equity securities
C. Voting rights
The voting rights attaching to each class of equity securities are set out below:
(a) Ordinary shares: On a show of hands every member present at a meeting in person or by proxy
shall have one vote and upon a poll each share shall have one vote.
(b) Options: No voting rights.
(c) Performance rights: No voting rights.
There are no other classes of equity securities.
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