Asanko Gold Inc. Annual Report 2014

FY2014 Annual Report · Asanko Gold Inc.

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ACADEMIES AUSTRALASIA GROUP LIMITED
ANNUAL REPORT 2014

ACN 000 003 725

CHAIRMAN’S REPORT

Dear Shareholder

In last year’s report Neville Cleary stressed the need for the party that won the 2013 Federal election to look
hard at reviving the international education sector. In the year to June 2014, after five years of shrinking
enrolments, the sector grew by 11.5 per cent, or $1.2 billion, to $15.7 billion. This is pleasing to see. But is
this the result of a well thought through strategy put together by the Federal government or, as the Executive
Director of the International Education Association of Australia recently put it, is it just ‘a happy confluence
of circumstances?’ There is a need for a long term plan, supported by all branches of government, that all
participants, especially the non-public sector which is risking its own capital, can work from. Without a clear
blueprint for the future, planning our own operations continues to be difficult. Academies Australasia looks
forward to the Federal Government’s response to the Chaney Report – commissioned in 2011 and submitted
19 months ago.

It has been an eventful year – the biggest achievement being the divestment of our fasteners business
following which Academies Australasia is exclusively engaged in education. We sold the business for $7.7
million in cash, of which $3.9 million has been received. The remaining $3.8 million is due to be paid in four
equal instalments by December 2014, 2015, 2016 and 2017. The debt is secured.

We made several acquisitions, giving us operations around Australia and expanding our course offerings. In
the past 9 months, we acquired control of 7 registered training organisations bringing our total to 17 separately
licenced colleges offering more than 230 courses. We now have a healthy balance of domestic and
international students – 5 years ago we were 100% international students. While consolidating and bedding
down recent acquisitions, we will continue to keep an eye out for other opportunities. That said, as our track
record will show, we have been prudent in our valuations. We are in no rush to grow and will be careful to
avoid opportunities that are expensive.

On behalf of the Board, I would like to welcome all the directors, management and staff of the companies that
have joined the Academies Australasia Group since December last year.

We are pleased with the results for the year under review.
- Profit attributable to owners of the parent entity grew 61% to $5.3 million
- Revenue increased by 21% to $45.8 million
- Contribution from education operations increased by 40% to $8.0 million. Excluding investment

revaluation, the increase was 13%

The Board is pleased to declare a significant increase in the final dividend of 0.5 cents per share, to 3.0 cents,
taking the dividend for the year to 5.5 cents (fully franked).

We continue to strengthen our operations through the recruitment of senior staff, staff training and improving
our policies, procedures and systems. The streamlining and standardisation of operations throughout the group
is also an important focus.

Substantial commitments were made in respect to new premises and the upgrading of existing premises.
Academies Australasia Polytechnic was relocated from 303 Collins Street to 628 Bourke Street in Melbourne
and additional space was taken up in Penrith and in Brisbane.

In October 2013, the end date of the Performance Incentive Plan (‘PIP’) was brought forward and the PIP
closed, for a once-off charge of $344,000 in the period under review. The PIP was structured around
profitability and increase in the value of the Company’s shares. Following the unexpected increase in the
Company’s share price after the share placement in August 2013, the Board considered it prudent, reasonable
and in the interest of stakeholders, to bring forward the end date. It is the Board’s intention to consider an
alternative performance incentive programme to attract and hold senior staff.

- 1 -

I am pleased to report that the Group Managing Director has agreed to sign on for a further term of 3 years
following the expiry of his current contract on 31 December 2014.

There was a substantial increase in the Company’s share capital since the Annual General Meeting on 21
October 2013. At that date, the Company had 52,748,143 shares on issue. Since then, 9,315,341 shares were
issued to bring the total shares on issue today to 62,063,484. This 17.7% increase in shares was for the
purpose of two acquisitions:

a. 3,409,091 shares being payment for the acquisition of DFL Education (Qld) Pty Limited; and
b. 5,906,250 shares being part payment for the acquisition of Newco CLB Training & Development Pty

Limited as trustee for the CLB Unit.

It is pleasing to note that notwithstanding the substantial increase in shares, the earnings per share as well as
the share price have increased. The Board continues to look out for investments that complement current
businesses and where earnings per share is expected to be accretive and, where appropriate, will consider
issuing equity as consideration. The directors have relevant interests in more than 50% of all shares on issue.

Looking forward, I reiterate the importance of there being a clear plan for the international education sector in
Australia. The world demand for international education (students enrolled for education outside their country
of citizenship) has increased substantially over the past 30 years. This trend is expected to continue. Australia
continues to be attractive to international students. We believe that Academies Australasia is well positioned
for further growth. In the international space, our operations in Singapore are well regarded and a good base
from which to grow further in the region. Our recent acquisitions, especially Spectra Training, are expected to
make us a significant player in the domestic arena.

With Neville Cleary’s retirement the Board is comprised of 4 members. Consideration is being given to
expanding the Board and I expect to be able to make an announcement in this regard shortly.

I would like to thank the Group Managing Director and all the directors, management and staff throughout the
group for their contribution in the year under review. My fellow directors and I would like to thank all
shareholders, students, customers and business associates for their loyalty and support.

Finally, may I say that it was an honour to be asked by my colleagues on the Board to take on the position of
Chairman upon Neville Cleary’s retirement. He left the Company in a good position - and big shoes to fill. I
will do my best.

Dr John Lewis Schlederer
Chairman
3 September 2014

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CORPORATE GOVERNANCE STATEMENT

The Board of Academies Australasia Group Limited (‘the Company’) is committed to the highest standards of
corporate governance and enhancing shareholder value. The following Corporate Governance Statement
outlines the framework in which the Board operates to ensure this commitment is upheld.

At the date of this report, the Board comprised the following:

- Dr John Lewis Schlederer
- Christopher Elmore Campbell
- Chiang Meng Heng
- Gabriela Del Carmen Rodriguez Naranjo

Chairman, Non-Executive, Independent
Group Managing Director, Executive
Director, Non-Executive
Director, Executive from 21 October 2013
(Alternate to Neville Thomas Cleary to 31
December 2013)

Appointed
2010
1996
2000
2013

All were members of the Board throughout the year.

Mr Neville Cleary (Chairman and Non-Executive Director) retired from the Board on 31 December 2013.

The Board endorses the Australian Securities Exchange (‘ASX’) Corporate Governance Principles and
Recommendations, (2nd Edition with 2010 Amendments) (‘Recommendations’). This Corporate Governance
Statement is prepared in accordance with these Recommendations.

The ASX Corporate Governance Council recently published a new edition of the Principles and
Recommendations (being the 3rd
Edition), but these changes will only take effect for full year financial reports
commencing on or after 1 July 2014. These changes are therefore not applied to this statement.

Given the small size and composition of the Board, the small size of the Company, its activities, and its cost
structures, it is neither reasonable nor practicable to comply with certain Recommendations.

Key management of the group at any time during the reporting period comprises the Board of the Company
and the senior group executives:

- Stephanie Ann Noble - Group Finance Manager and Company Secretary - Academies Australasia Group

Limited.

- Edmund Kwan - Executive Director and Chief Executive Officer - Academies Australasia College Pte.

Limited.

- Esther Teo - Executive Director and Chief Executive Officer - Academies Australasia Polytechnic Pty
Limited and Executive Director and Chief Executive Officer - Vostro Institute of Training Pty Limited
(from 3 June 2014).
Ivan James Mikkelsen - Director and General Manager - Premier Fasteners Pty Limited (until 1 December
2013).

This statement identifies and explains where the Company has not complied fully with any of the eight
principles stated in the Recommendations.

- 3 -

Principle 1 – Lay solid foundations for management and oversight

Roles and Responsibilities of Board and Management

The Board is responsible for the overall corporate governance of the Company including setting its strategic
direction and performance objectives, increasing shareholder wealth, meeting ethical and regulatory
obligations, and managing business risk.

Key responsibilities include:

appointing and removing the Group Managing Director;
final approval and monitoring of corporate strategies and performance objectives;

•
•
• monitoring senior group executive performance and implementation of the Board approved strategies;
•
•

reviewing and ratifying systems of risk management and internal compliance and control;
approving and monitoring the progress of major capital expenditure, capital management, and
acquisitions and divestments;
approving and monitoring financial and other reporting; and

•
• other matters required to be dealt with by the Board from time to time.

All senior group executives are subject to annual performance review. The Company evaluates their expected
contribution, progress, and achievements. All senior group executives were reviewed in respect to
performance during the year ended 30 June 2014.

The Board ensured that the terms of the (now closed) performance incentive plan (‘PIP’) were complied with.

To assist in the execution of its responsibilities, the Board has established an Audit and Risk Committee and a
Remuneration Committee.

The Board delegates responsibility for the day-to-day operation and administration of the Company to the
Group Managing Director.

The Board meets at least four times per financial year to review the Company’s strategy and progress, with the
Audit and Risk Committee meeting at least twice a year and the Remuneration Committee meeting at least
once a year.

Principle 2 – Structure the Board to add value

Board Composition

The relevant skills, experience, expertise, and terms of office of each director, who is in office at the date of
the annual report, are detailed in the Directors’ Report.

The name of the independent director of the Company is:

Dr John Lewis Schlederer

When determining whether a non-executive director is independent the director must not fail any of the
following materiality thresholds:

•

less than 5% of Company shares are held by the director and any entity or individual directly or
indirectly associated with the director;

• no sales are made to or purchases made from any entity or individual directly or indirectly associated

with the director; and

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• none of the director’s income or the income of an individual or entity directly or indirectly associated
with the director is derived from a contract with any member of the consolidated group other than
income derived as a director of the group.

The Board regularly assesses whether each non-executive director is independent. In assessing a director’s
independence, materiality is assessed on a case by case basis having regard to the individual circumstances of
the director.

Chiang Meng Heng and Christopher Elmore Campbell each have relevant interests of 5% or more in the
Company’s shares. Chiang Meng Heng and Christopher Elmore Campbell are not independent. Gabriela Del
Carmen Rodriguez Naranjo is an Executive Director and is not independent. There is therefore only one
independent director and so the Board does not meet the Recommendation that there be a majority of
independent directors. However, the Board wishes to state that nothing has come to its attention that would
cause it to question whether current procedures and governance are inappropriate for a company of its
structure and size. The skills, experience, and performance of the non-independent directors have led the
Board to conclude that they do act in the best interests of the Company.

Consistent with the Recommendations, the position of Chairman is held by an independent director and the
roles of Chairman and Group Managing Director are exercised by separate individuals, Dr John Lewis
Schlederer and Christopher Elmore Campbell respectively.

All directors – whether independent or not - should bring an independent judgement to bear on Board
decisions. All directors have the right to seek independent professional advice in the furtherance of their duties
as directors at the company’s expense. Written approval must be obtained from the Chairman prior to
incurring any expense on behalf of the company.

Nominations Committee

The purpose of a Nominations Committee is to ensure that the Board comprises directors with a range of skills
and experience appropriate for achieving its mandate.

Currently, the Board executes all of the same functions a Nominations Committee would. The Board
determines the appointment of new directors, except where a director is elected by shareholders. When
considering the appointment of a new director, the Board follows the same principles and guidelines a
Nominations Committee would. These principles and guidelines are outlined below.

Procedure for Selection and Appointment of New Directors

The structure of the Board is determined having regard to the following criteria:

• The Chairman should be a non-executive director, preferably independent.
• A majority of the Board should be non-executive directors, preferably independent.
• The roles of Chairman and Group Managing Director should not be exercised by the same individual.
• The Board should comprise of directors with an appropriate range of qualifications and expertise.

The following principles and guidelines are adhered to in the selection and appointment of new directors:

• The Board is required to have a broad range of skills, experience, diversity, and commercial expertise
to ensure that it is able to discharge its mandate effectively. Therefore, when an individual is
nominated for consideration as a director, they are evaluated on their skills, experience, diversity, and
how they would complement or enhance the Board's effectiveness.

• The composition of the Board needs to be conducive to making decisions expediently and in the best

•

interests of the Company as a whole (rather than of individual shareholders or interest groups).
Individuals being considered for non-executive roles will be required to provide the Board with details
of their other commitments and an indication of the time involved. Candidates must be able to satisfy
the Board that they will have sufficient time to meet what is expected of them.

- 5 -

• The Constitution of the Company provides that the Board may at any time appoint any person to be a
director. That person shall hold office until the end of the next general meeting and shall be eligible
for election at that meeting.

• The Constitution of the Company provides that at every general meeting one-third of the directors or,
if their number is not a multiple of three, then the number nearest to one-third, shall retire from office
and be eligible for re-election.

Performance Evaluation

The Board conducts a review of its performance, policies and practices annually. The review includes an
examination of the effectiveness and composition of the Board, including the required mix of skills,
experience, diversity and other qualities that the non-executive directors should bring to the Board. The Board
also reviews the Company’s strategic direction, objectives, and corporate governance practices. The Board
reviews the objectives and achievements of the Group Managing Director and senior group executives
annually, with the Chairman regularly discussing performance with directors throughout the year.

The Board reviewed its performance and the performance of its committees and individual directors and all
senior group executives in respect to the year ended 30 June 2014.

Principle 3 – Promote ethical and responsible decision making

Code of Conduct

The Company has established a Code of Conduct to guide the Board and senior group executives as to the
practices necessary to maintain confidence in the Company's integrity, as well as the responsibility and
accountability of individuals for reporting and investigating reports of unethical practices. The Company and
its directors, managers, employees, and contractors are expected to act with high standards of honesty,
integrity, independent judgement, fairness, and equity; striving at all times to enhance the reputation and
performance of the consolidated group as a whole.

The Company’s Code of Conduct is on the Company’s website (www.academies.edu.au).

Diversity Policy

The Company is committed to diversity and inclusiveness. It aims to provide an environment in which
employees have equal access to opportunities, are treated with fairness and respect, and are not judged by
unlawful or irrelevant reference to their attributes. This commitment enables the Company to attract and retain
people with the best skills and abilities.

A copy of the Company’s Diversity Policy is on the Company’s website (www.academies.edu.au)

The Company does not favour or discriminate against females. As at 30 June 2014, 43% of senior group
executives, including Board members were female. The objective of 30% female composition of Board and
senior group executives combined was therefore achieved.

At that date, 63% of group employees (excluding academic staff) were female. The objective is to have an
equal balance of male and female employees (excluding academic staff).

Employees have a wide range of qualifications and experience and come from more than 20 countries.

Share Trading Policy

A copy of the Company’s policy on the trading of the Company’s securities by key management personnel is
on the Company’s website (www.academies.edu.au).

- 6 -

The policy also addresses the subject of ‘Insider Trading’ – i.e. trading while in possession of price sensitive
information. Employees must not trade in the Company’s securities while in possession of price sensitive
information. This prohibition applies to all employees at all times.

Principle 4 – Safeguard integrity in financial reporting

Audit and Risk Committee

The names and qualifications of the directors appointed to the Audit and Risk Committee and their attendance
at meetings of the committee are included in the Directors’ Report.

During the year the Audit and Risk Committee comprised of Dr John Lewis Schlederer, Neville Thomas
Cleary (to 31 December 2013) and Chiang Meng Heng. The Committee was chaired by Dr John Lewis
Schlederer.

The Company complied with all four recommendations until the retirement of Neville Thomas Cleary on 31
December 2013. Presently, it complies with the recommendation that all members be non-executive. It does
not comply with the minimum member size of three, the Chairman not being the Chairman of the Board and
having a majority of independent directors.

The Group Managing Director, Executive Director, Group Finance Manager and external auditor attend Audit
and Risk Committee meetings.

The functions of the Audit and Risk Committee encompass:

• Financial reporting
• Risk management
• Authorities for financial risk management
• External audit
•
Internal audit
•
Insurance programme
• Legal proceedings

The Audit and Risk Committee’s Charter is available on the Company’s website (www.academies.edu.au).

Principle 5 – Make timely and balanced disclosure

Continuous Disclosure

The Company has adopted a policy to ensure that it complies with its continuous disclosure obligations under
the ASX Listing Rules, which state that:

Once an entity is or becomes aware of any information concerning it that a reasonable person would expect to
have a material effect on the price or value of the entity's securities, the entity must immediately tell ASX that
information.

Employees must immediately notify the Group Managing Director if they become aware of any information
that should be considered for release to the market. The information is reviewed and, if considered material,
the appropriate disclosure is made to the ASX.

The Company will not release any information to any other party until acknowledgement has been received
from the ASX that the information has been released to the market.

A copy of the Company’s Continuous Disclosure policy is on the Company’s website
(www.academies.edu.au).

- 7 -

Principle 6 – Respect the rights of shareholders

The Company recognises that shareholders must receive high quality relevant information in a timely manner
in order to be able to properly and effectively exercise their rights.

The Company aims to ensure that shareholders are informed of all major developments affecting the
Company. Information is communicated to shareholders on a regular basis through continuous disclosures and
half yearly and annual reports. The Board ensures that these reports include all relevant information about the
operations of the Company, changes in the state of affairs of the Company and details of future developments.

All documents that are released publicly (i.e. ASX Announcements and Annual Reports) are made available
on the Company's website (www.academies.edu.au).

The Board encourages full participation of shareholders at the Annual General Meeting to ensure a high level
of accountability and identification with the Company's strategy and goals. Important issues are presented to
the shareholders as single resolutions. The Board also requests that the external auditor attend the Annual
General Meeting and be available to answer shareholder questions about the conduct of the audit and the
preparation and content of the auditor's report.

Principle 7 – Recognise and manage risk

The Board has established policies for the oversight and management of material business risks. The Audit
and Risk Committee assists the Board in carrying out this function.

The following material business risks that have the potential to adversely impact the Company’s operations
are addressed:

a. Financial risk: market price risk, liquidity risk, credit risk and corporate and bank guarantees.
b. Business risk: A range of policies and procedures dealing with specific business risks, including:

- Delegation of Authority;
- Capital investment;
- Business conduct; and
- Litigation reporting.

c. Operational risk:

- Health, safety and environment;
- Asset protection and operational security; and
-

Insurance.

Procedures exist to monitor risk, with ultimate reporting to the Board, through either the Audit and Risk
Committee for financial and business risk or the Group Managing Director for operational risk.

The Board acknowledges that the policies are designed to provide reasonable but not absolute protection
against errors and irregularities and that they are intended to identify control issues that require the attention of
the Board or Audit and Risk Committee.

Management has reported that the material business risks are being managed effectively.

The Company has a number of financial control processes to ensure that the information that is presented to
senior management and the Board is both accurate and timely. The control processes include, among other
things:

annual audit and half year review by the external auditor;

-
- management review of the balance sheet and internal control environment;
- monthly review of financial performance compared to budget and forecast; and

- 8 -

analysis of financial performance and significant balance sheet items with comparative
periods.

The Board reviews the implementation of the risk management and internal compliance and control system on
an annual basis. The group currently does not have an internal audit function due to the small size and cost
structure of the group. As the group grows, consideration will be given to establishing an internal audit
operation – either staffed in-house or on contract with an external firm.

For the annual and half-year accounts released publicly, the Board has received assurance from the Group
Managing Director (Chief Executive Officer) and the Group Finance Manager (Chief Financial Officer) that,
in their opinion:

-
-

the financial records of the group have been properly maintained;
the financial statements and notes required by accounting standards for external reporting:
• give a true and fair view of the financial position and performance of the Company and

•
•

the consolidated group; and
comply with the accounting standards and applicable ASIC Class orders; and
the above representations are based on a sound system of risk management and internal
control and that the system is operating effectively in all material respects in relation to
financial reporting risks.

Principle 8 – Remunerate fairly and responsibly

Remuneration Policies

The Remuneration Committee annually reviews and makes recommendations to the Board on remuneration
packages and policies applicable to the Group Managing Director, senior group executives and directors
themselves. This role also includes responsibility for share option schemes, performance incentive packages,
superannuation entitlements, any remuneration by gender, retirement and termination entitlements, fringe
benefit policies and professional indemnity and liability insurance policies. Remuneration levels are
competitively set to attract the most qualified and experienced directors and senior executives.

The directors and senior group executives are all on fixed remuneration. The Company PIP was closed on 22
October 2013. Non-executive directors were not eligible to participate in the PIP.

Remuneration Committee

The role of the Remuneration Committee is to assist the Board with the application of its remuneration
policies. The structure of this committee is consistent with the Recommendations in that it comprises at least
three members and has an independent Chair. However, only one of the three members is an independent
director. This is because its members are procured from the Board, where there is only one independent
director.

The names of the members of the Remuneration Committee and their attendance at meetings of the
Committee are detailed in the Directors’ Report.

There are no schemes for retirement benefits other than statutory superannuation for non-executive directors.

A copy of the Company’s Remuneration Committee Charter is on the Company’s website
(www.academies.edu.au).

This Corporate Governance Statement and information about the Company’s corporate governance practices
and policies (including ‘Charters’ referred to in this statement) is available on the Company’s website at
www.academies.edu.au

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106th ANNUAL REPORT OF THE DIRECTORS

Your directors present this report on Academies Australasia Group Limited and its controlled entities for the
financial year ended 30 June 2014.

DIRECTORS

The names of directors in office at any time during or since the end of the year are:

- Dr John Lewis Schlederer
- Neville Thomas Cleary
- Christopher Elmore Campbell
- Chiang Meng Heng
- Gabriela Del Carmen Rodriguez Naranjo Appointed 21 October 2013 (Alternate to Neville Thomas

Retired 31 December 2013

Cleary until 31 December 2013)

Dr John Lewis Schlederer, Christopher Elmore Campbell, Chiang Meng Heng and Gabriela Del Carmen
Rodriguez Naranjo have all been in office since the start of the financial year to the date of this report.

Neville Thomas Cleary was in office from the start of the financial year until 31 December 2013.

COMPANY SECRETARY

Mrs Stephanie Noble held the position of company secretary of Academies Australasia Group Limited at the
end of the financial year. She was appointed company secretary on 27 November 2006. Mrs. Noble is a CPA
Australia and a Fellow of the Association of Chartered Certified Accountants and holds an Honours Degree in
Accounting.

PRINCIPAL ACTIVITIES

The principal activity of the consolidated group during the course of the financial year was the provision of
training and education services. The fasteners business was sold on 1 December 2013.

CONSOLIDATED RESULT

The consolidated profit of the consolidated group for the financial year after providing for income tax and
eliminating non-controlling entity interests amounted to $5,400,000 (2013: $3,269,000).

REVIEW OF OPERATIONS

A review of the operations of the consolidated group during the financial year and the results of those
operations are as follows:

Education

The contribution from the education business (before tax) increased by 40% to $7,984,000 (2013: $5,681,000)
during the financial year, while revenue increased by 40% to $42,569,000.

Excluding the $2,109,000 from the revaluation of investments, the contribution before tax increased by 13%.

- 10 -

During the year the group acquired control of (See Note 14):

- DFL Education (Qld) Pty Limited T/A Brisbane School of Hairdressing, Gold Coast School of

Hairdressing and Brisbane School of Beauty (‘DFL’).
International College of Capoeira Pty Limited T/A College of Sports & Fitness (‘CSF’).

-
- Vostro Institute of Training Australia Pty Limited (‘Vostro Institute’).
- Kreate Pty Limited T/A RuralBiz Training.
- Newco CLB Training and Development Pty Limited as trustee for the CLB Unit Trust T/A Spectra

Training

Fasteners

The contribution from the fasteners business (before tax) was $359,000 and revenue was $3,215,000. The
fasteners business was sold on 1 December 2013

Dividends Paid or Proposed

A fully franked dividend of two and a half cents per share ($1,319,000) was paid on 26 September 2013. An
interim fully franked dividend of two and a half cents per share ($1,404,000) was paid on 15 April 2014.

The directors have announced the payment of a fully franked final dividend of three cents per share
($1,861,905), to be paid on 26 September 2014.

FINANCIAL POSITION

The net assets of the consolidated group have increased by $16,302,000 since 30 June 2013.

SIGNIFICANT CHANGES IN STATE OF AFFAIRS

There were no significant changes in the state of affairs of the consolidated group during the reporting period.

EVENTS AFTER THE REPORTING PERIOD

The acquisition of Newco CLB Training & Development Pty Limited as trustee for the CLB Unit Trust T/A Spectra
Training was finalised on 23 July 2014 (See Note 14). On 1 July 2014, Spectra Training acquired 100% of
Print Training Australia Pty Limited (‘PTA’). With the acquisition of Spectra Training, PTA became a wholly
owned subsidiary of the group.

On 16 August 2014, the group acquired 75% of Language Links International Pty Limited, a college in Perth
that offers English Language courses.

At an Extraordinary General Meeting held on 1 September 2014, shareholders approved the issue of the
1,500,000 new shares to the vendors of Spectra Training, and also ratified the prior issue of 7,815,341 shares.

There were no other matters or circumstances that have arisen since the end of the financial year which
significantly affected or may significantly affect the operations of the consolidated group, the results of those
operations, or the state of affairs of the consolidated group in subsequent financial years.

- 11 -

FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES

Reference is made in the Chairman’s Report (Pages 1 and 2) to the consolidated group’s future direction. No
detailed information in respect of the consolidated group’s corporate strategies has been included, as directors
believe that the disclosure of such information is likely to result in unreasonable prejudice to the consolidated
group.

ENVIRONMENTAL ISSUES

The consolidated group operations are not subject to any significant environmental legislation.

- 12 -

INFORMATION ON DIRECTORS

Dr John Lewis Schlederer

Qualifications/Experience

Interest in Shares
Special Responsibilities

- Chairman, (Independent & Non-Executive), Director since 2010,
Chairman since 1 January 2014.
- B.Sc (Hons), PhD, Grad. Diploma. More than 20 years teaching
experience, at University of New South Wales and TAFE NSW
(Technical and Further Education, New South Wales) and many
years in business.

- 987,140 shares (1.59%) as at 2 September 2014
- Chairman of the Remuneration Committee and Audit and Risk

Committee. Non-Executive Director of Benchmark Resources Pty
Limited T/A Benchmark College.

Directorships held in other listed entities

- None

Christopher Elmore Campbell

Qualifications/Experience

Interest in Shares
Special Responsibilities

- Group Managing Director and Chief Executive Officer, since
1996.
- B.Soc.Sci. (Hons), FFin, FAICD, FCIS, FSCA. Previous
positions include senior appointments with the Monetary
Authority of Singapore and an international bank in Australia.

- 7,416,767 shares (11.95%) as at 2 September 2014
- Member of the Remuneration Committee. Director of each of the

subsidiary companies in the Academies Australasia Group.

Directorships held in other listed entities

Director, Asia Society Australia.
- None.

Chiang Meng Heng
Qualifications/Experience

Interest in Shares
Special Responsibilities

- Director (Non-Executive), since 2000.
- BBA (Hons). Previous positions include President, Asia

Commercial Bank Ltd, Adviser & Department Head, Monetary
Authority of Singapore, Managing Director, First Capital
Corporation Ltd, Executive Director, Far East Organization and
Group Managing Director, Lim Kah Ngam Ltd.

- 24,941,886 shares (40.19%) as at 2 September 2014
- Member of the Audit and Risk, and Remuneration Committees.
Chairman (Non-executive) and Director of ACA Investment
Holdings Pte. Limited, Centre for Australian Education Pte.
Limited and Academies Australasia College Pte. Limited.

Directorships held in other listed entities

- Far East Orchard Limited, Macquarie International Infrastructure

Fund Limited and Keppel Land Limited (all listed on the
Singapore Stock Exchange).

Gabriela Del Carmen Rodriguez
Naranjo
Qualifications/Experience

Interest in Shares
Special Responsibilities

- Executive Director, since 21 October 2013. (Alternate to Neville

Cleary May 2011 to December 2013).

- B. Comp.Sci, B.Sci. Sys. Eng, MAICD. More than 10 years
experience in various aspects of international education in
Australia.

- 15,000 shares (0.02%) as at 2 September 2014
- Executive Director, Academies Australasia Group Limited.

General Manager and Chief Operations Officer of Academies
Australasia Pty Limited and Director of each of its subsidiaries
(excluding ACA Investment Holdings Pte. Limited).

- 13 -

REMUNERATION REPORT

Remuneration Policies

The Remuneration Committee reviews and makes recommendations to the Board on remuneration packages and
policies applicable to the Group Managing Director, senior group executives and directors themselves.
This role also includes responsibility for share option schemes, performance incentive packages, superannuation
entitlements, retirement and termination entitlements, fringe benefit policies and professional indemnity and
liability insurance policies. Remuneration levels are competitively set to attract the most qualified and
experienced directors and senior executives. During the year, the members of the Remuneration Committee
were Dr John Lewis Schlederer, Neville Thomas Cleary (to 31 December 2013), Chiang Meng Heng and
Christopher Elmore Campbell.
The remuneration policy of the Company in respect of directors and senior group executives is to ensure
certainty of exposure of the Company to employees by agreeing a fixed salary for each director and senior group
executive.
All executives receive a base salary, which is based on factors such as length of service and experience and
superannuation (as required by law). Executives may sacrifice part of their salary to increase payments towards
superannuation.
There are no options over unissued capital. The Company does not have an employee share option plan. The PIP
was closed on 22 October 2013.
All remuneration paid to directors and executives is valued at the cost to the Company and expensed.
The maximum aggregate amount of fees that can be paid to non-executive directors is subject to approval by
shareholders at the Annual General Meeting. The amount approved at the 2009 Annual General Meeting is
$250,000 per annum. Fees for non-executive directors are not linked to the performance of the consolidated
group.

Directors and Senior Group Executives

a. Directors and Senior Group Executives

The names of each person holding the position of director of Academies Australasia Group Limited at any time
during the financial year were:

- Dr John Lewis Schlederer (Independent & Non-Executive Director, Chairman from 1 January 2014).

- Neville Thomas Cleary (Independent & Non-Executive Director and Chairman to 31 December 2013)

- Christopher Elmore Campbell (Group Managing Director - Executive).

- Chiang Meng Heng (Non-Executive Director).

- Gabriela Del Carmen Rodriguez Naranjo (Alternate Director to Neville Thomas Cleary to 31 December

2013. Executive Director from 21 October 2013).

The names of each person holding the position of senior group executive, other than executives listed above at
any time during the financial year were:

- Stephanie Ann Noble (Group Finance Manager and Company Secretary - Academies Australasia Group

Limited. Director Premier Fasteners Pty Limited to 1 December 2013).

- Edmund Kwan (Executive Director and Chief Executive Officer- Academies Australasia College Pte.

Limited).

- Esther Teo (Executive Director and Chief Executive Officer - Academies Australasia Polytechnic Pty
Limited. Executive director and Chief Executive Officer - Vostro Institute of Training Australia Pty
Limited from 3 June 2014).
Ivan James Mikkelsen (Director and General Manager - Premier Fasteners Pty Limited to 1 December
2013).

- 14 -

b. Directors and Senior Group Executives Remuneration

The remuneration for each director and each of the senior group executives during the year was as follows:

2014 Directors and Senior group executives

Short-term employee benefits

PIP/bonus

Cash, salary
and
commissions

Non-
monetary
benefits

Post- employment
benefits

Superannuation

Total

Dr John Lewis Schlederer

Neville Thomas Cleary (to 31 December 2013)

Christopher Elmore Campbell

Chiang Meng Heng

Gabriela Del Carmen Rodriguez Naranjo

Stephanie Ann Noble

Edmund Kwan

Esther Teo

Ivan James Mikkelsen (to 1 December 2013)

$000s

372

136

131

102

967

-
a
172
b
107
32
c
73
-

455

3
a
24
b
22
10
c
34
13

521

332

260

120

209

219

1,641

Non-recurring payment arising from the early closure of the PIP
a Gabriela Del Carmen Rodriguez Naranjo $133,000
b Stephanie Ann Noble $83,000
c
Esther Teo $56,000

2013 Directors and Senior group executives

Short-term employee benefits

Dr John Lewis Schlederer

Neville Thomas Cleary

Christopher Elmore Campbell

Chiang Meng Heng

Gabriela Del Carmen Rodriguez Naranjo

Stephanie Ann Noble

Edmund Kwan

Esther Teo

Ivan James Mikkelsen

Jacqualine Apps

Bridget Carroll (to 4 March 2013)

Philip Carroll (to 4 March 2013)

PIP/bonus

Cash, salary
and
commissions

Non-
monetary
benefits

373

130

124

183

120

143

1,303

220

Post- employment
benefits

Superannuation

Total

593

191

168

135

221

131

252

1,796

None of the remuneration paid to any director or senior group executive is tied to any specific performance
condition.

- 15 -

c. Options issued as part of remuneration for the year ended 30 June 2014

No options were granted as part of remuneration.

d. Employment contracts of senior group executives

The employment conditions of all senior group executives are formalised in written contracts of employment.
Generally, the employment contracts stipulate a one-month resignation period. Termination payments are
generally not payable on resignation or dismissal for serious misconduct. In the instance of serious misconduct
the company can terminate employment at any time.

Christopher Elmore Campbell has agreed to a further term of 3 years following the expiration of his current
contract of employment on 31 December 2014.

MEETINGS OF DIRECTORS

The number of directors’ meetings (including meetings of committees of directors) and the number of
meetings attended by the directors of the Company during the financial year are:

Director

Directors’
Meetings
B

Audit and Risk
Committee
B

Remuneration
Committee
B

Dr John Lewis Schlederer
Neville Thomas Cleary (retired 31
December 2013)
Christopher Elmore Campbell
Chiang Meng Heng
Gabriela Del Carmen Rodriguez Naranjo

5
7
7
7

1
2
2
2

1
1
1
-

A - Number of meetings held during the time the director held office during the period
B - Number of meetings attended

INDEMNIFICATION AND INSURANCE OF OFFICERS

The Company’s Articles of Association provides an indemnity to officers of the Company. The Company is
required to pay all costs, losses and expenses that an officer may incur by reason of any contract entered into
or act or thing done by them in the discharge of their duties except where they act dishonestly.

The Company has also paid an insurance premium in respect of a directors and officers liability insurance
policy covering the directors and officer’s liabilities as officers of the Company. It has also taken out “key
man” insurance policies, the premium and nature of the liabilities covered by the policies are not to be
disclosed, under the terms of the policies.

OPTIONS

No options have been issued on the Company’s shares.

- 16 -

PROCEEDINGS ON BEHALF OF THE COMPANY

The Company was not a party to any proceedings in a Court of Law during the year.

NON-AUDIT SERVICES

The Board of Directors, in accordance with advice from the Audit and Risk Committee, is satisfied that the
provision of non-audit services during the year is compatible with the general standard of independence of
auditors imposed by the Corporations Act 2001. The directors are satisfied that the services disclosed below
did not compromise the external auditor’s independence for the following reasons:

• All non-audit services are reviewed and approved by the Audit and Risk Committee.
• The nature of services provided does not compromise the general principles relating to audit

independence.

The following fees were paid or payable for non-audit services to the external auditors during the year ended
30 June 2014:

• Taxation services
• Due diligence and other services

$73,000
$217,000

- 17 -

AUDITOR’S INDEPENDENCE DECLARATION

The Auditor’s Independence Declaration for the year ended 30 June 2014 has been received and can be found
on page 19.

Signed in accordance with a resolution of the Board of Directors.

Dr John Lewis Schlederer
Director

3 September 2014

Christopher Elmore Campbell
Director

- 18 -

ACADEMIES AUSTRALASIA GROUP LIMITED
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2014

Note 2014
$000s

2013
$000s

Revenue from continuing operations

Depreciation and amortisation expense
Cost of sales
Cost of services
Employee benefits expense
Finance costs
Insurance
Lease rental expense – operating leases
Legal expenses
Non-executive directors fees
Payroll tax
Other expenses

Profit before income tax

Income tax expense

Profit for the year

45,784

37,827

(767)
(1,549)
(14,633)
(10,569)
(305)
(494)
(4,990)
(113)
(116)
(574)
(4,600)

(715)
(3,587)
(12,230)
(8,066)
(210)
(424)
(4,084)
(74)
(133)
(438)
(3,303)

7,074

4,563

(1,674)

(1,294)

5,400

3,269

Other comprehensive income:
Exchange differences on translating foreign controlled entities

Net (loss)/gain on revaluation of assets

Other comprehensive income for the year, net of tax

Total comprehensive income for the year

Profit attributable to:

Owners of the parent entity

Non-controlling interests

Total comprehensive income attributable to:

Owners of the parent entity

Non-controlling interests

Earnings per share (cents per share)
Basic
Diluted

Dividends per share (cents)

The accompanying notes form part of these financial statements.

7
7

- 20 -

(25)

(719)

(744)

4,656

5,264

136

5,400

4,520

136

4,656

9.8
8.8

5.0

630

717

3,986

3,269

3,986

6.8
6.8

5.0

ACADEMIES AUSTRALASIA GROUP LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2014

Note

2014
$000s

2013
$000s

Current Assets

Cash and cash equivalents
Trade and other receivables
Inventories
Other current assets
Total Current Assets

Non-Current Assets

Trade and other receivables
Investments
Plant and equipment
Deferred tax assets
Intangible assets
Total Non-Current Assets

Total Assets

Current Liabilities

Trade and other payables
Current tax liabilities
Borrowings
Provisions
Total Current Liabilities

Non-Current Liabilities

Deferred tax liability
Borrowings
Provisions
Total Non-Current Liabilities

Total Liabilities

Net Assets

Equity

Share capital
Share capital contracted to be issued
Accumulated losses
Asset revaluation reserve
Foreign currency translation reserve
Non-controlling interests

Total Equity

9
10
11
12

10
13
15
16
17

18
4
19
20

16
19
20

21a
21b

7,833
8,798
-
1,227
17,858

6,225
2,618
6,637
-
28,770
44,250

62,108

18,852
297
1,319
1,556
22,024

85
2,665
5,740
8,490

30,514

31,594

25,446
7,087
(1,319)
-
58
322

31,594

4,992
2,417
3,815
956
12,180

-
903
3,759
436
10,408
15,506

27,686

6,327
456
969
752
8,504

-
2,402
1,488
3,890

12,394

15,292

18,372
-
(4,226)
1,063
83
-

15,292

The accompanying notes form part of these financial statements.

- 21 -

ACADEMIES AUSTRALASIA GROUP LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
As at 30 June 2014

Ordinary
Shares

Other
Equity

Retained
Profits

Reserves

Non -
Controlling
Interests

Total

$000s

(4,414)

3,269

(694)

(2,387)

(4,226)

429

630

717

1,146

743

14,496

3,269

630

3,986

484

114

(743)

(1,401)

(2,387)

15,292

(4,226)

5,264

1,146

15,292

136

5,400

344

(25)

(1,063)

(25)

(719)

5,608

(1,088)

136

4,656

(2,701)

(1,319)

186

7,087

(484)

3,808

3,936

(2,701)

322

31,594

Balance at 1.7.2012

Profit for the period

Exchange differences on translating
foreign operations

Asset revaluation reserve

Total comprehensive income for
the year

Share issue (PIP)

Share issue (Investment in associate)

Acquisition of non-controlling
interests

Dividend paid

17,738

484

114

Balance at 30.6.2013

18,372

Balance at 1.7.2013

Profit for the period

Exchange differences on translating
foreign operations

Asset revaluation reserve

Total comprehensive income for
the year

Shares contracted to be issued
(Acquisition of subsidiary)

Share issue (PIP)

Share issue (Placement)

Acquisition of subsidiaries

Dividend paid

18,372

(484)

3,808

3,750

7,087

Balance at 30.6.2014

25,446

7,087

The accompanying notes form part of these financial statements.

- 22 -

ACADEMIES AUSTRALASIA GROUP LIMITED
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 30 June 2014

Cash Flows from Operating Activities

Receipts from customers
Payments to suppliers and employees
Interest received
Finance costs
Income taxes paid

Note
2014
$000s

2013
$000s

44,410
(40,166)
73
(305)
(1,097)

39,849
(33,326)
63
(210)
(950)

Net cash provided by (used in) operating activities

25a

2,915

5,426

Cash Flows from Investing Activities

Proceeds from sale of plant & equipment
Purchase of plant & equipment
Expenditure on re branding
Net cash on acquisition/disposal of subsidiaries
Investment in subsidiary
Acquisition of non-controlling interests
Investment in associate
Investment in other financial assets

Net cash provided by (used in) investing activities

Cash Flows from Financing Activities

Dividends paid
Proceeds from borrowings
Repayment of borrowings
Proceeds from share placement
Non recurring payment (PIP)

Net cash provided by (used in) financing activities

Net increase in cash held
Cash at the beginning of the financial year

Cash at the end of the financial year

39
(1,805)
-
1,701
-
-
-
-

(65)

(2,701)
1,784
(1,893)
3,808
(1,007)

(9)

2,841
4,992

7,833

-
(262)
(62)
585
(190)
(1,401)
(300)
(29)

(1,659)

(2,387)
1,781
(737)
-
-

(1,343)

2,424
2,568

4,992

The accompanying notes form part of these financial statements.

- 23 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

The financial report is a general purpose financial report that has been prepared in accordance with
Australian Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements
.
of the Australian Accounting Standards Board and the Corporations Act 2001
The financial report includes the consolidated financial statements of Academies Australasia Group Limited
and controlled entities. Details of the parent entity can be found in Note 30.
Academies Australasia Group Limited is a listed public company, incorporated and domiciled in Australia.
The group is a for profit entity for financial reporting purposes under Australian Accounting Standards
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions.
Compliance with Australian Accounting Standards ensures that the financial statements and notes also
comply with International Financial Reporting Standards. Material accounting policies adopted in the
preparation of this financial report are presented below and have been consistently applied unless otherwise
stated.

Basis of preparation

The accounting policies set out below have been consistently applied to all years presented.
The financial report has been prepared on an accruals basis and is based on historical costs modified by the
revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value
basis of accounting has been applied. The financial report is presented in Australian Dollars and rounded to
the nearest thousand dollars in accordance with Class Order 98/100.

Accounting Policies

Basis of consolidation

The consolidated financial statements incorporate all of the assets, liabilities and results of the parent
(Academies Australasia Group Limited) and all of the subsidiaries (including any structured entities).
Subsidiaries are entities the parent controls. The parent controls an entity when it 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 over the entity. A list of the subsidiaries is provided in Note 14.
The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the
group from the date on which control is obtained by the group. The consolidation of a subsidiary is
discontinued from the date that control ceases. Intercompany transactions, balances and unrealised gains or
losses on transactions between group entities are fully eliminated on consolidation. Accounting policies of
subsidiaries have been changed and adjustments made where necessary to ensure uniformity of the
accounting policies adopted by the group.
Equity interests in a subsidiary not attributable, directly or indirectly, to the group are presented as “non-
controlling interests”. The group initially recognises non-controlling interests that are present ownership
interests in subsidiaries and are entitled to a proportionate share of the subsidiary’s net assets on liquidation
at either fair value or at the non-controlling interests’ proportionate share of the subsidiary’s net assets.
Subsequent to initial recognition, non-controlling interests are attributed their share of profit or loss and each
component of other comprehensive income. Non-controlling interests are shown separately within the equity
section of the statement of financial position and statement of comprehensive income.

- 24 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Business combinations

Business combinations occur where an acquirer obtains control over one or more businesses.
A business combination is accounted for by applying the acquisiton method, unless it is a combination
involving entities or businesses under common control. The business combination will be accounted for from
the date that control is attained, whereby the fair value of the identifiable assets acquired and liabilities
(including contingent liabilities) assumed is recognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability resulting
from a contingent consideration arrangement is also included. Subsequent to initial recognition, contingent
consideration classified as equity is not remeasured and its subsequent settlement is accounted for within
equity. Contingent consideration classified as an asset or liability is remeasured each reporting period to fair
value, recognising any change to fair value in profit or loss, unless the change in value can be identified as
existing at acquisition date.
All transaction costs incurred in relation to the business combination are expensed to the statement of
comprehensive income.
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase.

Cash and cash equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly
liquid investments with original maturities of one month or less, and bank overdrafts. Bank overdrafts are
shown within short-term borrowings in current liabilities on the balance sheet.

Trade and other receivables

Trade and other receivables include amounts due from customers for services performed and goods sold in
the ordinary course of business. Receivables expected to be collected within 12 months of the end of the
reporting period are classified as current assets. All other receivables are classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost
using the effective interest method, less any provision for impairment. Refer to Note 10 for further discussion
on the determination of impairment losses.

Inventories

Inventories are measured at the lower of cost and net realisable value. The cost of manufactured products
includes direct materials, direct labour and an appropriate portion of variable and fixed overheads. Overheads
are applied on the basis of normal operating capacity. Costs are assigned on the basis of weighted average
costs.
Where the book value of stock items exceeds the net realisable value, a provision for diminution in value is
raised.

- 25 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Financial instruments

Recognition and Initial Measurement
Financial instruments, incorporating financial assets and financial liabilities, are recognised when the entity
becomes a party to the contractual provisions of the instrument. Trade date accounting is adopted for
financial assets that are delivered within timeframes established by marketplace convention.
Financial instruments are initially measured at fair value plus transactions costs where the instrument is not
classified as at fair value through profit or loss. Transaction costs related to instruments classified as at fair
value through profit or loss are expensed to profit or loss immediately. Financial instruments are classified
and measured as set out below.
Derecognition
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the
risks and benefits associated with the asset. Financial liabilities are derecognised where the related
obligations are either discharged, cancelled or expire. The difference between the carrying value of the
financial liability extinguished or transferred to another party and the fair value of consideration paid,
including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.
Classification and Subsequent Measurement

Loans and receivables

Available-for-sale investments

Financial assets at fair value through profit or loss

i.
Financial assets are classified at fair value through profit or loss when they are held for trading for the
purpose of short term profit taking, where they are derivatives not held for hedging purposes, or
designated as such to avoid an accounting mismatch or to enable performance evaluation where a
group of financial assets is managed by key management personnel on a fair value basis in accordance
with a documented risk management or investment strategy. Realised and unrealised gains and losses
arising from changes in fair value are included in profit or loss in the period in which they arise.
ii.
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market and are subsequently measured at amortised cost using the effective
interest rate method.
iii.
Available-for-sale investments are non-derivative financial assets that are either not capable of being
classified into other categories of financial assets due to their nature or they are designated as such by
management. They comprise investments in the equity of other entities where there is neither a fixed
maturity nor fixed or determinable payments.
They are subsequently measured at fair value with any re-measurements other than impairment losses
and foreign exchange gains and losses recognised in other comprehensive income. When the financial
asset is derecognised, the cumulative gain or loss pertaining to that asset previously recognised in
other comprehensive income is reclassified into profit or loss.
Available-for-sale financial assets are classified as non-current assets when they are expected to be
sold after 12 months from the end of the reporting period. All other available-for-sale financial assets
are classified as current assets.
iv.
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at
amortised cost using the effective interest rate method.

Financial Liabilities

- 26 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Derivative instruments
The group has no derivative instruments at reporting date.

Fair value
The only financial asset or liability carried at fair value is investments. Fair value is determined by a number
of market and observable factors, including quoted prices, market activity levels, the financial position and
performance of the investment and the relative size of the group’s shareholding. They are categorised as a
Level 1 in the fair value hierarchy of the Accounting Standards (market inputs are used to determine fair
value).

Financial guarantees
Where material, financial guarantees are issued, which require the issuer to make specified payments to
reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due, are
recognised as a financial liability at fair value on initial recognition. The guarantee is subsequently measured
at the higher of the best estimate of the obligation and the amount initially recognised less, when appropriate,
cumulative amortisation in accordance with AASB 118: Revenue. Where the entity gives guarantees in
exchange for a fee, revenue is recognised under AASB 118.
The fair value of financial guarantee contracts has been assessed using a probability weighted discounted
cash flow approach. The probability has been based on:

the likelihood of the guaranteed party defaulting in a year period;
the proportion of the exposure that is not expected to be recovered due to the guaranteed party
defaulting; and
the maximum loss exposed if the guaranteed party were to default.

Interest borrowing costs
Interest payable costs are recognised as expenses in the period in which they are incurred.

Leases

Leases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset,
but not the legal ownership, are transferred to entities in the consolidated group, are classified as finance
leases. Finance leases are capitalised by recording an asset and a liability at the lower of the amounts equal to
the fair value of the leased property or the present value of the minimum lease payments, including any
guaranteed residual values. Lease payments are allocated between the reduction of the lease liability and the
lease interest expense for the period. Leased assets are depreciated on a straight-line basis over the shorter of
their estimated useful lives or the lease term.
Operating lease rental payments are recognised on a straight line basis over the lease term and contingent
rental payments are recognised in the period when incurred.
Assets receivable under lease incentives are recognised when the group has a contractual right to them and
they can be reliably estimated. Where applicable, specific categories of assets received under such
arrangements are recognised in the appropriate asset heading and accounted for in accordance with the
group’s applicable accounting policy for that asset.
Lease incentives under operating leases are recognised as a liability and amortised as a reduction in rent on a
straight-line basis over the lease term, unless another systematic basis is more representative of the time
pattern in which the economic benefits from the leased asset are consumed.

- 27 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Plant and equipment

The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of
the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected
net cash flows that will be received from the asset’s employment and subsequent disposal. The expected net
cash flows have been discounted to their present values in determining recoverable amounts.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the group and the
cost of the item can be measured reliably. All other repairs and maintenance are charged to the income
statement during the financial period in which they are incurred.

Depreciation

The depreciable amount of all fixed assets including capitalised lease assets is depreciated on a straight-line
or a diminishing value basis over their useful lives to the consolidated group commencing from the time the
asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired
period of the lease or the estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable assets are:

Class of Fixed Asset

Leasehold improvements
Plant and equipment
Leased plant and equipment

Depreciation Rate
12.5 – 22.5%
5 – 40%
5 – 25%

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet
date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s
carrying amount is greater than its estimated recoverable amount. Gains and losses on disposals are
determined by comparing proceeds with the carrying amount. These gains and losses are included in the
statement of comprehensive income.

Goodwill

Goodwill is carried at cost less accumulated impairment losses. Goodwill is calculated as the excess of the
sum of:
-
-
-

the consideration transferred
any non-controlling interest; and
the acquisition date fair value of any previously held equity interest

over the acquisition date fair value of net identifiable assets acquired.
The acquisition date fair value of the consideration transferred for a business combination plus the
acquisition date fair value of any previously held equity interest shall form the cost of the investment in the
separate financial statements.
Fair value uplifts in the value of pre-existing equity holdings are taken to the statement of comprehensive
income. Where changes in the value of such equity holdings had previously been recognised in other
comprehensive income, such amounts are recycled to profit or loss.

- 28 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

The amount of goodwill recognised on acquisition of each subsidiary in which the group holds less than a
100% interest will depend on the method adopted in measuring the non-controlling interest.
The group can elect in most circumstances to measure the non-controlling interest in the acquiree either at
fair value (full goodwill method) or at the non-controlling interest’s proportionate share of the subsidiary’s
identifiable net asets (proportionate interest method). In such circumstances, the group determines which
method to adopt for each acquisition and this is stated in the respective notes of these financial statements
disclosing the business combination.
Under the full goodwill method, the fair value of the non-controlling interest is detemined using valuation
techniques which make the maximum use of market information where available. Under this method,
goodwill attributable to the non-controlling interests is recognised in the consolidated financial statements.
Goodwill on acquisitions of subsidiaries is included in intangible assets.
Goodwill is tested for impairment annually and is allocated to the group’s cash-generating units or groups of
cash-generating units, representing the lowest level at which goodwill is monitored not larger than an
operating segment. Gains and losses on the disposal of an entity include the carrying amount of goodwill
related to the entity disposed of.
Changes in the ownership interests in a subsidiary are accounted for as equity transactions and do not affect
the carrying values of goodwill.

Intangible assets

Intangible assets include course development costs and other intangible assets.
Course development costs are capitalised where they can be related to the development of an identifiable and
separable resource and which yields particular streams of future economic benefits. They are only capitalised
when technical feasibility studies identify that the project is expected to deliver future economic benefits and
these benefits can be measured reliably. These capitalised costs are amortised over their useful lives starting
from the time the development of a particular resource is complete and available for use.

Impairment of assets

At each reporting date, the group reviews the carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets have been impaired. If such an indication exists,
the recoverable amount of the asset, being the higher of the asset’s fair value less costs to sell and value in
use, is compared to the asset’s carrying value. Any excess of the asset’s carrying value over its recoverable
amount is expensed to the statement of comprehensive income.
Impairment testing is performed annually for goodwill and intangible assets with indefinite lives.
Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
Collectibility of trade debtors is reviewed on an ongoing basis. Debts are written off when they are known to
be uncollectible. A provision for doubtful debts is raised where some doubt as to collection exists and is the
difference between the total amount owing and the amount expected to be recovered.

Trade and other payables

Trade and other payables represent the liabilities for goods and services received by the entity that remain
unpaid at the end of the reporting period. The balance is recognised as a current liability with the amounts
normally paid within 30 days of recognition of the liability.

- 29 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Provisions and employee benefits

Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past
event, it is probable that an outflow of resources embodying economic benefits will be required to settle the
obligation and a reliable estimate can be made of the amount of the obligation.
Provisions are measured at the present value of management’s best estimate of the expenditure required to
settle the present obligation at the balance sheet date. If the effect of the time value of money is material,
provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current
market assessments of the time value of money and, where appropriate, the risks specific to the liability.
Provision is made for the group’s liability for employee benefits arising from services rendered by
employees to balance date. Employee benefits that are expected to be settled within one year have been
measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee
benefits payable later than one year have been measured at the present value of the estimated future cash
outflows to be made for those benefits.

Issued capital

Ordinary shares are classified as equity, and are recognised at the fair value of the consideration received by
the company. Incremental costs directly attributable to the issue of new shares are shown in equity as a
deduction, net of tax, from the proceeds.
The group has entered into a commitment to settle transactions in its own shares and these new shares yet to
be issued are recognised in equity, separately from issued capital. Once the shares are issued they are
transferred within equity to issued capital. (Note 21)

Revenue

Revenue recognition relating to the provision of education services is determined with reference to the stage
of completion of the transaction at the end of the reporting period, where the outcome of the contract can be
estimated reliably. The assessment of stage of completion of educational services is also determined by
reference to the provision of educational resources and the proportion of their costs incurred to date as well
as the tuition day count.
Revenue from the sale of goods is recognised upon the delivery of goods to customers.
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the
financial assets.
Dividend revenue is recognised when the right to receive a dividend has been established.
Rental revenue is recognised on a straight line accrual basis over the term of the lease.
All revenue is stated net of the amount of goods and services tax (GST).

Goods and services tax (GST)

Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST
incurred is not recoverable from the Australian Tax Office. In these circumstances the GST is recognised as
part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in
the balance sheet are shown inclusive of GST.
Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of
investing and financing activities, which are disclosed as operating cash flows.

- 30 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Income tax

The charge for current income tax expense is based on the profit for the year adjusted for any non-assessable
or disallowed items. It is calculated using the tax rates that have been enacted or are substantially enacted by
the balance sheet date.
Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences
arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.
No deferred income tax will be recognised from the initial recognition of an asset or liability, excluding a
business combination, where there is no effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or
liability is settled. Deferred tax is credited in the income statement except where it relates to items that may
be credited directly to equity, in which case the deferred tax is adjusted directly against equity.
The amount of benefits brought to account or which may be realised in the future is based on the assumption
that no adverse change will occur in income taxation legislation and the anticipation that the consolidated
group will derive sufficient future assessable income to enable the benefit to be realised and comply with the
conditions of deductibility imposed by the law.
Academies Australasia Group Limited and its wholly-owned Australian subsidiaries have formed an income
tax consolidated group under the tax consolidation regime. The group notified the Australian Tax Office that
it had formed an income tax consolidated group to apply from 1 July 2003.
The tax consolidated group has entered a tax sharing agreement whereby each company in the group
contributes to the income tax payable in proportion to their contribution to the net profit before tax of the tax
consolidated group.

Foreign currency transactions and balances

Foreign currency transactions are translated into Australian currency (the functional currency) using the
exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the
year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the
exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the
exchange rate at the date when fair values were determined.

Foreign Group Companies
The financial results and position of foreign operations whose functional currency is different from the
group’s presentation currency are translated as follows:

-
-

assets and liabilities are translated at year-end exchange rates prevailing at the end of the financial
year;
income and expenses are translated at average rates for the period; and
retained earnings are translated at the exchange rates prevailing at the date of the transaction.

Exchange differences arising on translation of foreign operations are transferred directly to the group’s
foreign currency translation reserve in the statement of financial position. These differences are recognised in
the statement of comprehensive income.

Earnings per share

Basic earnings per share are calculated as net profit attributable to members of the parent divided by the
weighted average number of ordinary shares.
Diluted earnings per share is calculated as net profit attributable to members of the parent, divided by the
weighted average number of shares both issued and contracted to be issued.

- 31 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (continued)

Comparative figures

When required by Accounting Standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.

Critical accounting estimates and judgements

The directors evaluate estimates and judgements incorporated into the financial report based on historical
knowledge and best available current information. Estimates assume a reasonable expectation of future
events and are based on current trends and economic data, obtained both externally and within the group.
These changed estimates and judgements are considered significant items of revenue and expenses relevant
in explaining the financial performance.
Key Estimates – Impairment
The group assesses impairment at each reporting date by evaluating conditions specific to the group that may
lead to impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is
determined. Value-in-use calculations performed in assessing recoverable amounts incorporate a number of
key estimates. Further details on the key estimates used in impairment can be found in Note 17. No
impairment has been recognised in respect of goodwill for the year ended 30 June 2014.
Key Estimates – Revenue
Stage completion for student revenue is estimated as per revenue policy.

Segment reporting

An operating segment is a component of an entity

that engages in business activities from which it may earn revenues and incur expenses (including
revenues and expenses relating to transactions with other components of the same entity)

- whose operating results are regularly reviewed by the entity’s Board to make decisions about resources

to be allocated to the segment and assess its performance
for which discrete financial information is available

-
The company has determined that it has only one operating segment, education, since the sale of the
fasteners business on 1 December 2013.

- 32 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

2. REVENUE

Operating activities

- Sale of goods
- Services revenue
- Interest received
- Rent received

Non-operating activities

- Other

Total Revenue

3. PROFIT FOR THE YEAR

Expenses

Finance costs - external

Bad and doubtful debts – trade receivables

Rental expense on operating leases
- Minimum lease payments
- Contingent rentals

2014
$000s

2013
$000s

3,215
40,094
69
297
43,675

7,495
29,818
64
272
37,649

2,109

178

45,784

37,827

305

4,794
196
4,990

210

4,065
19
4,084

Superannuation expenses

814

530

4. INCOME TAX EXPENSE

a. The components of tax expense comprise:

Current tax
Deferred tax

b. The prima facie tax on profit from ordinary activities before tax is

reconciled to income tax as follows:

Tax payable on profit from ordinary activities before tax at 30%
Add/(less):
Tax effect of:
Permanent differences
Assumption of tax balances of controlled entities
Income tax expense attributable to the entity

- 33 -

(921)
(753)
(1,674)

(1,413)
119
(1,294)

2,122

1,369

(184)
(264)
1,674

32
(107)
1,294

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

4. INCOME TAX EXPENSE (continued)

c. Current tax payable for the year reconciles as follows:

Opening provision
Add: Current year provision
Less: Over provision previous year
Add: Tax balance subsidiary acquired
Less: Tax paid
Closing provision

2014
$000s

2013
$000s

456
929
(8)
17
(1,097)
297

(9)
1.447
(32)
-
(950)
456

5. SENIOR GROUP EXECUTIVES COMPENSATION

Names and positions of the senior group executives in office at any time during the financial year are:

Senior group executive

Position

Christopher Elmore Campbell

Group Managing Director.

Gabriela Del Carmen Rodriguez Naranjo

Stephanie Ann Noble

Edmund Kwan

Esther Teo

Executive Director - Academies Australasia Group Limited from
21 October 2013. General Manager and Chief Operations Officer
of Academies Australasia Pty Limited and director of each of its
subsidiaries (except ACA Investment Holdings Pte. Limited).

Group Finance Manager and Company Secretary - Academies
Australasia Group Limited. Director Premier Fasteners Pty
Limited to 1 December 2013.

Executive Director and Chief Executive Officer - Academies
Australasia College Pte. Limited.

Executive Director and Chief Executive Officer - Academies
Australasia Polytechnic Pty Limited.
Executive Director and Chief Executive Officer - Vostro Institute
of Training from 3 June 2014

Ivan James Mikkelsen

Director and General Manager - Premier Fasteners Pty Limited to
1 December 2013.

b. Remuneration for senior group executives has been included in the Remuneration Report section of the Directors’

Report.

- 34 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

5. SENIOR GROUP EXECUTIVES COMPENSATION (continued)

Shareholdings

Number of shares held by senior group executives and parties related to them

Senior group executive

Balance
1.7.2013

Net Change
Other
(i)

000s

Christopher Elmore Campbell

Gabriela Del Carmen Rodriguez Naranjo

8,137

126

(i) Shares purchased on market via the Australian Securities Exchange.

(ii) Shares surrendered and cancelled

PIP

(ii)

000s

(846)

Balance
30.6.2014

000s

7,417

6. AUDITOR’S REMUNERATION

Remuneration of the auditor of the parent entity for:
- Auditing and reviewing the financial report
- Taxation services
- Due diligence and other services

Remuneration of other auditors of subsidiaries for:
- Auditing and reviewing the financial report
- Taxation services
- Other services

7. EARNINGS PER SHARE

Basic (cents per share)

Diluted (cents per share)

2014
$000s

2013
$000s

186
73
217
476

15
4
-
19

9.8

8.8

155
24
40
219

14
3
3
20

6.8

Weighted average number of ordinary shares used in calculation of basic
earnings per share

54,401

47,867

In estimating the fully dilutive earnings per share the ordinary shares contracted to be issued (5,906,250) were
included

b. The earnings figure used was $5,264,000, being profit on ordinary activities after tax attributable to owners of

the parent entity.

- 35 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

8. DIVIDENDS

Distributions recognised

Interim fully franked ordinary dividend of 2.5 cents per share (2013: 2.5 cent
fully franked)

2013 final fully franked ordinary dividend of 2.5 cents per share paid in 2014
(2012 2.5 cents franked paid in 2013 )

Interim fully franked ordinary dividend of 2.5 cents per share 2013 returned

Dividends proposed or declared but not recognised in the financial
statements:
Proposed fully franked ordinary dividend of 3 cents per share (2013: 2.5
cents fully franked)

Balance of franking account at year end adjusted for franking credits
arising from:

2014
$000s

2013
$000s

1,404

1,180

1,319

(22)
2,701

1,207

-
2,387

1,862

1,340

—

payment of income tax

3,646

2.445

9. CASH AND CASH EQUIVALENTS

Cash at bank and on hand

7,833

4,992

Included in the above are tuition fees held in Tuition Protection Service Account in Australia
In 2012 the Education Services for Overseas Student Act 2000 (“ESOS Act”) was amended to provide additional
protection for international students studying in Australia. With effect from 1 July 2013, the group is now required to
maintain, in Australia, separate bank accounts for prepaid fees received from international students prior to
commencement of their course.
As at 30 June 2014, the group held $5,100,000 (2013: $3,801,000) in prepaid fees for students who had not yet
commenced studies, with a corresponding amount included in deferred revenue.
These funds are held in separate bank accounts until the student commences their course, at which point the funds may
be used to settle normal obligations of the group. At all times, the group must ensure that there are sufficient funds in
these separate bank accounts to repay any prepaid tuition fees to all international students who have paid and have not
yet commenced their course.

10. TRADE AND OTHER RECEIVABLES

CURRENT
Trade receivables
Receivable from the sale of Premier Fasteners
Lease incentives
Other receivables

NON-CURRENT
Receivable from the sale of Premier Fasteners
Lease incentives

- 36 -

2014
$000s

2013
$000s

3,157
937
304
4,400
8,798

2,813
3,412
6,225

2,201
-
-
216
2,417

-
-
-

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

10. TRADE AND OTHER RECEIVABLES (continued)

2014
$000s

2013
$000s

TOTAL
Trade receivables
Receivable from the sale of Premier Fasteners
Lease incentives
Other receivables

a. The ageing analysis of trade receivables is as follows:

0 -30 days
31- 60 days – not impaired *
61- 90 days – not impaired *
+91 days – not impaired *

3,157
3,750
3,716
4,400
15,023

1,708
327
214
908
3,157

2,201
-
-
216
2,417

847
641
198
515
2,201

* These are debtors that are past due for which no collateral is held and for which no provision for doubtful debts
has been made as there has not been a significant change in credit quality and the directors believe that the
amounts are still recoverable.

b. The consolidated group has an exposure to credit risk in Singapore and Australia given the consolidated group’s
operations in those countries. An amount of $348,000 has been included in trade and other receivables in respect
of the business operations in Singapore. All other receivables of the consolidated group are exposures in
Australia.

c. The receivable from the sale of Premier Fasteners is over 4 years in accordance with the terms of the contract for

the sale.

11. INVENTORIES

CURRENT
At cost
Raw materials and stores
Finished goods

12. OTHER ASSETS

CURRENT
Prepayments and accrued income
Security deposits

13. INVESTMENTS

NON-CURRENT
Investment in Associate (a)
Shares in Listed Corporations

2014
$000s

2013
$000s

-
-
-

564
3,251
3,815

1,062
165
1,227

-
2,618
2,618

954
2
956

394
509
903

a. On 1 December 2013, the group acquired an additional 11 % of the issued share capital of International College
of Capoeira Pty Limited T/A as College of Sports & Fitness. Academies Australasia Group Limited now owns
51% (See Note 14).

- 37 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

14. CONTROLLED ENTITIES

Parent Entity - Academies Australasia Group Limited

Ultimate Parent Entity - Academies Australasia Group Limited

Academies Australasia Pty Limited
Premier Fasteners Pty Limited (Sold 1 December 2013)
Skilled Placements Pty Limited

Parent Entity - Academies Australasia Pty Limited

Academies Australasia (Management) Pty Limited
Academy of English Pty Limited
Academies Australasia Institute Pty Limited
Australian Institute of Professional Studies Pty Limited
Australian International High School Pty Limited
Australian College of Technology Pty Limited
Australian Trades Institute Pty Limited
Clarendon Business College Pty Limited
Supreme Business College Pty Limited
AMI Education Pty Limited
ACA Investment Holdings Pte. Limited
Academies Australasia College Pte. Limited
Centre for Australian Education Pte. Limited (Incorporated 9 December 2013)
AKG Investment Holdings Pty Limited
Academies Australasia Polytechnic Pty Limited
AKG2 Investment Holdings Pty Limited
Benchmark Resources Pty Limited T/A Benchmark College
AKG3 Investment Holdings Pty Limited
Live. Laugh. Learn. Pty Limited
AKG4 Investment Holdings Pty Limited
Discover English Pty Limited

International College of Capoeira Pty Limited T/A College of Sports & Fitness
(Acquired additional 11% 1 December 2013)

DFL Education (Qld) Pty Limited T/A Brisbane School of Hairdressing, Gold Coast
School of Hairdressing and Brisbane School of Beauty (Acquired 1 December 2013)

Vostro Institute of Training Australia Pty Limited (Acquired 1 December 2013)
Kreate Pty Limited T/A RuralBiz Training (Acquired 2 June 2014)
Newco CLB Training & Development Pty Limited as trustee for the CLB Unit
Trust T/A Spectra Training (2 June 2014)

Percentage of voting power is in proportion to ownership/control

- 38 -

Country of
Incorporation

Percentage
Owned/Controlled
(%)

2014

2013

Australia
Australia
Australia

Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Singapore
Singapore
Singapore
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia

Australia

Australia
Australia

Australia

100
-
100

100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100

100

100
51

100

100
100
100

100
100
100
100
100
100
100
100
100
100
100
100
-
100
100
100
100
100
100
100
100

-
-

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

14. CONTROLLED ENTITIES (continued)

Acquisition of controlled entities

On 1 December 2013, the group acquired:

a) 100% of the issued share capital of DFL, a college operating in Brisbane and the Gold Coast, for a consideration
of $4,858,094. The purchase was satisfied by the issue of 3,409,091 fully paid ordinary shares in Academies
Australasia Group Limited and the payment of $1,108,094 in cash.

b) A further 11% of the issued share capital of CSF, for $70,000 in cash. The group now owns 51%.
c) 100% of the issued share capital of Vostro Institute, a college in Melbourne. The consideration was $2,000,000

in cash. The acquisition was completed on 30 January 2014.

The numbers below incorporate final adjustments to those reported on 31 December 2013 ($717,000, $121,000 and
$592,000 respectively), to reflect adjustments to identifiable assets acquired and liabilities assumed at the date of
acquisition.

Vostro Institute

CSF

DFL

Fair Value Fair Value Fair Value

Purchase consideration

-Ordinary shares

-Ordinary shares – 25 October 2012

-Cash – 25 October 2012

-Cash

-Group share accumulated profit as associate

Less:

Cash

Receivables

Property, plant and equipment

Intangibles

Payables

Identifiable assets acquired and liabilities assumed

Group share

Goodwill

Purchase consideration settled in cash

Cash inflow on acquisition

$000s

100%

2,000

623

633

134

(1,639)

(235)

2,235

2,000

623

$000s

51%

114

300

491

203

298

371

(696)

176

401

203

$000s

100%

3,750

1,108

4,858

195

417

653

(577)

701

4,157

1,108

195

- 39 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

14. CONTROLLED ENTITIES (continued)

Acquisition of controlled entities (continued)

On 2 June 2014, the group acquired

a) 51% of the issued share capital of RuralBiz Training, a college in Dubbo, NSW for a consideration of $234,835

in cash.

b) 100% control of Spectra Training, a college in Melbourne, operating throughout mainland Australia. The
consideration was $15,750,000, to be satisfied by the issue of 5,906,250 new fully paid ordinary shares in
Academies Australasia Group Limited and the payment of $8,662,500 in cash, financed by a bank loan. The
acquisition was completed on 23 July 2014. On that date the cash component was paid and 4,406,250 shares
were issued. The issue of the remaining 1,500,000 shares was approved by shareholders on 1 September 2014.

The acquisitions are part of the group’s overall strategy to expand its education operations.

RuralBiz Training

Spectra Training

Fair Value

$000s

51%

235

229

(64)

204

104

131

235

229

$000s

100%

7,087

8,663

15,750

4,682

396

1,178

(2,598)

3,695

12,055

8,663

Purchase consideration

-Ordinary shares (to be issued)

-Cash

-Cash payable to vendor

Less:

Cash

Receivables

Property, plant and equipment

Intangibles

Payables

Identifiable assets acquired and liabilities assumed

Group share

Goodwill

Purchase consideration settled in cash

Cash inflow on acquisition

- 40 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

14. CONTROLLED ENTITIES (continued)

The consolidated revenue and profit of the group if the acquisitions had taken place on 1 July 2013 has not been
disclosed. This is because it is impracticable to determine what the results of these acquisitions might have been prior to
the actual date of acquisition in accordance with the accounting policies of the group using available accounting
information.

It is impracticable to disclose the profit of these acquisitions since acquisition and include them in the consolidated
statement of comprehensive income. This is because they form part of the group’s education operation which is managed
as a unit. Some costs can be determined only from a group perspective and cannot be allocated specifically to them.
Consequently, it is not possible to determine separate results for these acquisitions.

Sale of Controlled entity

On 1 December 2013, the group sold Premier Fasteners Pty Limited for $7,688,937 in cash.

Fair Value

$000s

3,939

3,750

7,689

112

1,704

3,769

1,142

1,892

(930)

7,689

Sale Proceeds

-Cash

-Deferred consideration

Less:

Cash

Receivables

Inventories

Property, plant and equipment

Intangibles

Payables

Identifiable assets and liabilities sold

Gain/(loss) on disposal

- 41 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

15. PLANT AND EQUIPMENT

2014
$000s

2013
$000s

Plant and equipment
At cost
At valuation
Accumulated depreciation

Leasehold improvements
At cost
Accumulated amortisation

Leased plant and equipment
Capitalised leased assets
Accumulated depreciation

Total plant & equipment

2014

Balance at the beginning of the year
Revaluation
Additions
Acquisitions
Disposals
Depreciation expense
Net foreign currency difference arising on
translation of financial statements of foreign
operations
Carrying amount at the end of the year

2013

Balance at the beginning of the year
Revaluation
Additions
Disposals
Depreciation expense
Net foreign currency difference arising on
translation of financial statements of foreign
operations
Carrying amount at the end of the year

3,180
1,843
(2,322)
2,701

2,584
(1,550)
1,034

53
(29)
24

3,759

Total

$000s

3,759
(719)
4,125
1,580
(1,339)
(767)

(2)

6,637

3,233
974
295
(29)
(715)

3,759

5,043
-
(2,737)
2,306

5,762
(1,646)
4,116

215
-
215

6,637

Plant and
equipment

Leasehold
improvements

$000s

Leased
plant and
equipment

$000s

24
-
215
-
(24)
-

215

32
-
-
-
(8)

2,701
(719)
957
844
(1,110)
(365)

(2)

2,306

1,882
974
223
(11)
(367)

1,034
-
2,953
736
(205)
(402)

4,116

1,319
-
72
(18)
(340)

2,701

1,034

- 42 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

16. DEFERRED TAX ASSETS / LIABILITIES

Future income tax benefit

The future income tax benefits is made up of the following estimated tax benefits:
Temporary differences:
-deferred tax assets
-deferred tax liabilities

Tax losses:

-operating losses

2014
$000s

2013
$000s

(85)

436

980
(1,206)

141
(85)

948
(512)

-
436

Opening
Balance
$000s

Charged To
Income
$000s

Acquired

$000s

Closing
Balance
$000s

Deferred Tax Assets
Provisions
Unearned income
Other

Deferred Tax Liabilities
Plant & equipment
Investments
Prepayments and other

617
220
111
948

388
53
71
512

(221)
26
126
(69)

(117)
633
168
684

Deferred tax assets not brought to account, the benefits of which will only be
realised if the conditions for deductibility set out in Note 1r occur:
Tax losses:

-operating losses
-capital losses

13
76
12
101

-
-
10
10

409
322
249
980

271
686
249
1,206

2014
$000s

2013
$000s

407
-
-

407
5
412

- 43 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

17. INTANGIBLE ASSETS

Goodwill at cost
Accumulated impairment losses
Net carrying value

Course development costs
Accumulated amortisation
Net carrying value

Other at cost

Year ended 30 June 2014
Balance at the beginning of the year
Sale of Premier Fasteners
Acquisition of DFL
Acquisition of Vostro Institute
Acquisition of CSF
Acquisition of RuralBiz Training
Acquisition of Spectra Training
Rebranding costs
Balance at the end of the year

Year ended 30 June 2013
Balance at the beginning of the year
Foreign exchange adjustment
Acquisition of Discover English Pty Limited
Rebranding costs
Balance at the end of the year

Impairment Disclosures

Fasteners segment
Education segment
Total

- 44 -

2014
$000s

27,814
(382)
27,432

1,540
(352)
1,188

150
28,770

2013
$000s

10,727
(382)
10,345

-
-
-

63
10,408

Goodwill

$000s

10,345
(1,892)
4,157
2,235
401
131
12,055
-
27,432

9,952
8
385
-
10,345

Course
Development
Costs
$000s

Other

Total

$000s

-
-
-
-
-
-
1,188
-
1,188

-
-
-
-
-

63
-
13
11
-
-
71
(8)
150

1
-
-
62
63

10,408
(1,892)
4,170
2,246
401
131
13,314
(8)
28,770

9,953
8
385
62
10,408

2014
$000s

-
27,432
27,432

2013
$000s

1,892
8,453
10,345

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

17. INTANGIBLE ASSETS (continued)

The recoverable amount of each cash generating unit is determined based on value in use calculations supplemented by
the fair values of recent acquisitions. In accordance with paragraph 24 of AASB 136 Impairment of Assets, reliance has
been placed on a model created in a preceding period. The model includes a sensitivity analysis allowing for a range of
growth rates.

The following assumptions were used in the value in use calculations:

Education segment

10%

2.5

Growth rate

Discount rate

Terminal Multiple

The growth rate is a long-term average growth rate.
The discount rate used reflects entity and market specific factors
To generate impairment, the discount rate would need to be in excess of 20% or growth rates would need to be negative.

18. TRADE AND OTHER PAYABLES

CURRENT

Unsecured Liabilities
Trade payables a
Sundry payables and accrued expenses

Payable to the vendors of Spectra Training

2014
$000s

2013
$000s

4,997
5,192
10,189
8,663
18,852

4,071
2,256
6,327
-
6,327

a. Trade payables includes $3,521,000 (2013: $2,568,000) tuition fees paid in advance by college students.
b. Paid on 23 July 2014, financed by a bank loan.

19. BORROWINGS

CURRENT
Secured Liabilities – Interest Bearing
Bank bills
Trade finance loan facility
Lease purchase agreements

NON-CURRENT
Secured Liabilities – Interest Bearing
Bank bills
Lease purchase agreements

Note

19a
19a
19a

19a
19a

2014
$000s

2013
$000s

1,238
-
81
1,319

2,503
162
2,665

919
46
4
969

2,402
-
2,402

- 45 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

19. BORROWINGS (continued)

Note

2014
$000s

2013
$000s

a. Total current and non-current secured liabilities:

Bank bills
Trade finance loan facility
Lease purchase agreements

28
28
22, 28

b. The carrying amounts of non-current assets pledged as security are:

Floating charge over assets
Plant and equipment

3,741
-
243
3,984

39,147
215
39,362

3,321
46
4
3,371

11,099
-
11,099

c. The bank bills are secured by a floating charge over the assets of the parent entity and its wholly owned

subsidiaries (other than those in Note 23).

d. The lease purchase borrowings are additionally secured on the leased asset. The leases are due for repayment in

2017.

20. PROVISIONS

CURRENT

Employee entitlements

Lease incentives

Other

NON CURRENT

Employee entitlements

Lease incentives

Other

TOTAL

Employee entitlements

Lease incentives

Other

2014
$000s

2013
$000s

964

592

1,556

807

4,933

5,740

1,771

5,525

7,296

615

137

752

1,253

235

1,488

1,868

372

2,240

- 46 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

21. SHARE CAPITAL

Issued Share Capital

2014
Share number

2014
$000s

2013
Share number

2013
$000s

Ordinary shares fully paid

56,157,234

25,446

48,254,297

18,372

Ordinary share capital

Balance at the beginning of the financial year

48,254,297

18,372

47,209,410

17,738

Placement of ordinary shares on 2 August 2013

5,340,000

3,808

Ordinary shares issued on 1 December 2013 on
acquisition of DFL

3,409,091

3,750

Ordinary shares issued on 9 November 2012 (PIP)
and cancellation in September 2013

Ordinary shares issued on 25 October 2012 for
investment in CSF

Ordinary shares issued on 15 February 2013 on
acquisition of 25% of Academies Australasia
Polytechnic Pty Limited

(846,154)

(484)

846,154

484

142,858

114

55,875

Balance at the end of the financial year

56,157,234

25,446

48,254,297

18,372

b. Shares contracted to be issued

Ordinary shares fully paid to be issued on acquisition
of 100% of Spectra Training (See Note 14)

5,906,250

7,087

i. Shares disclosure.

Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the
number of shares held.
At a shareholders meeting each ordinary share is entitled to one vote when a poll is called. Otherwise, each shareholder
has one vote on a show of hands.
The number of shares authorised is equal to the number of shares issued. Shares have no par value.

ii. Capital Management.

Management controls the capital of the group in order to maintain a good debt to equity ratio, provide the shareholders
with adequate returns and ensure that the group can fund its operations and continue as a going concern.
The group’s debt and capital includes ordinary share capital and financial liabilities, supported by financial assets.
There are no externally imposed capital requirements.
Management effectively manages the group’s capital by assessing the group’s financial risks and adjusting its capital
structure in response to changes in these risks and in the market. These responses include the management of debt
levels, distributions to shareholders and share issues.
There were no changes in the group’s capital management procedures during the year.

- 47 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

22. LEASING COMMITMENTS

Lease purchase commitments

Payable – minimum lease payments

Not later than one year
Later than one year but not later than five years
Minimum lease payments
Less future finance charges
Present value of minimum lease payments

Note

2014
$000s

2013
$000s

93
172
265
(22)
243

4
-
4
-
4

19a

At the end of the lease periods the lessor’s charges over the plant and equipment cease, leaving the assets the
unencumbered property of the consolidated group.

Operating Lease commitments

Non-cancellable operating leases contracted for but not capitalised in the financial statements:

Not later than one year
Later than one year but not later than five years
Later than five years

2014
$000s

5,511
13,508
17,690
36,710

2013
$000s

3,825
8,982
1,530
14,337

The consolidated group leases property under operating leases expiring from 1 year to 15 years. Lease payments
comprise a base amount plus an incremental rental, based on either movement in the Consumer Price Index or minimum
percentage increase criteria. During the year, the group has acquired a number of new leases. Lease incentives have
been recognised in accordance with the group’s accounting policies.

23. CONTINGENT LIABILITIES AND CONTINGENT ASSETS

Contingent Liabilities

Guarantees

There is a corporate guarantee between the wholly owned group companies as security for the bank facilities. This
guarantee does not include:

Academies Australasia College Pte. Limited
Centre for Australian Education Pte. Limited
DFL Education (Qld) Pty Limited
Kreate Pty Limited

- 48 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

24. SEGMENT REPORTING

FASTENERS

EDUCATION

CONSOLIDATED

2014
$000s

2013
$000s

2014
$000s

2013
$000s

2014
$000s

2013
$000s

3,215
-

3,215

7,495
-

7,495

40,094
2,475

42,569

29,818
514

30,332

43,309
2,475

45,784
-

35,749
2,078

37,827
-

45,784

37,827

359

738

7,984

5,681

8,343

6,419

9,108

58,026

17,078

1,726

29,596

9,437

(1,269)

(1,856)

7,074

4,563

58,026
4,082

26,186
1,500

62,108

27,686

29,596
918

11,163
1,231

30,514

12,394

4,079

331

4,125

138

595

459

650

366

597

Primary reporting – Business segments
Revenue

External sales
Other revenue

Unallocated revenue

Total revenue

Segment result
Unallocated expenses net of unallocated
revenue

Profit from ordinary activities before
income tax

Segment assets
Unallocated

Total assets

Segment liabilities
Unallocated

Total liabilities

Acquisition of non-current segment assets

Depreciation and amortisation of segment
assets

Business segments

Major products/services of business segments:

Education
Fasteners

Provision of training and education services
Manufacture, import and sale of fasteners (to 1 December 2013)

Geographical information
The consolidated group operates in Australia and Singapore. The revenues and non-current assets of the consolidated
group are as follows:

Geographic Location
Revenues from External Customers
Non-current assets

$000s
Australia
40,279
27,447

$000s
Singapore
5,505
97

Accounting Policies
Segment revenues and expenses are those directly attributable to the segments.
Segment assets and liabilities include all assets used in and all liabilities generated by the segments. Deferred tax assets
and liabilities are not allocated to segments.

- 49 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

25. CASH FLOW INFORMATION

a. Reconciliation of cash flow from operations with profit after
income tax

2014
$000s

2013
$000s

Profit after income tax

5,400

3,269

Non-cash flows in profit (loss)
Amortisation
Depreciation
Net (profit)/loss on disposal of plant and equipment
Write-downs to recoverable amounts
Unrealised gain on investments
Unrealised foreign exchange movement
Deferred tax on revaluation

Changes in assets and liabilities
(Increase)/decrease in trade and other receivables
(Increase)/decrease in inventories
(Increase)/decrease in other current assets
(Increase)/decrease in investments
(Increase)/decrease in intangibles
(Increase)/decrease in deferred tax assets
Increase/(decrease) in trade and other payables
Increase/(decrease) in tax payables
Increase/(decrease) in loans
Increase/(decrease) in provisions

Cash flow from operations

b. Borrowing arrangements with banks

Total Facilities

Cash advance facilities available
Amount utilised

The major facilities are summarised as follows:

402
365
(9)
(104)
(2,109)
(22)
-

(1,432)
112
(38)
(27)
(71)
754
91
(176)
5
(226)

2,915

340
375
29
75
(178)
77
(272)

172
(161)
(87)
20
-
152
810
465
-
340

5,426

15,315
(3,537)
11,778

5,000
(3,321)
1,679

Bank overdrafts
Bank overdraft facilities are arranged with the general terms and conditions being set and agreed annually. They are due
for review on 1 July 2015. Interest rates are variable and subject to adjustment.

Cash Advance Facilities
$6,315,000 of the facilities expire on 30 June 2016 and $9,000,000 of the facilities expire on 14 September 2019.

- 50 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

26. EVENTS AFTER THE BALANCE SHEET DATE

The acquisition of Newco CLB Training & Development Pty Limited as trustee for the CLB Unit Trust T/A Spectra
Training was finalised on 23 July 2014 (See Note 14). On 1 July 2014, Spectra Training acquired 100% of Print
Training Australia Pty Limited (PTA). With the acquisition of Spectra Training, PTA became a wholly owned
subsidiary of the group.

On 16 August 2014, the group acquired 75% of Language Links International Pty Limited, a college in Perth that offers
English Language courses.

At an Extraordinary General Meeting held on 1 September 2014, shareholders approved the issue of the 1,500,000 new
shares to the vendors of Spectra Training, and also ratified the prior issue of 7,815,341 shares.

There were no other matters or circumstances that have arisen since the end of the financial year which significantly
affected or may significantly affect the operations of the consolidated group, the results of those operations, or the state
of affairs of the consolidated group in subsequent financial years.

The financial report was authorised on 3 September 2014 by the Board of Directors.

27. RELATED PARTY TRANSACTIONS

Directors’ transactions with the Company and the consolidated group

Details of directors’ remuneration are set out in the Remuneration Report section of the Directors’ Report. Directors are
reimbursed for expenses incurred by them on behalf of the consolidated group.
During the year, CSF paid $60,000 to Andre Cerutti and $28,000 to Julio Cerne Chaves, two of the directors of CSF,
being the settlement of their outstanding loans to the company.

Directors’ and specified executives’ relevant interests in shares

Details of directors’ relevant interests in shares are set out in the Directors’ Report.

Other related party transactions

Transactions between the Company and controlled entities include loans, management fees and interest are eliminated
on consolidation.

28. FINANCIAL INSTRUMENTS

Financial Risk Management

The group’s financial instruments consist mainly of deposits with banks, investments, accounts receivable and
payable, loans to and from subsidiaries, bills and leases.

The main purpose of non-derivative financial instruments is to raise finance for group operations.

Treasury Risk Management

Senior management meet on a regular basis to review currency and interest rate exposure and to evaluate
treasury management strategies where relevant, in the context of the most recent economic conditions and
forecasts.

- 51 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

28. FINANCIAL INSTRUMENTS (continued)

ii.

Financial Risks

The main risks the group is exposed to through its financial instruments are interest rate risk, foreign
currency risk, liquidity risk, credit risk and price risk.

Interest rate risk

The interest rate risk has been managed by the consolidated group by reducing and in most cases
eliminating interest bearing debt. Stand by facilities has been set with a combination of fixed and floating
rate possibilities. There is no set policy as to the mix of interest rate exposures.

Foreign currency risk
The consolidated group is exposed to foreign currency risk on its purchase of products and the sale of
training and education courses to international students and on the translation of its foreign subsidiaries.
The consolidated group had not hedged foreign currency transactions as at 30 June 2014. Senior
management continue to evaluate this risk on an ongoing basis.
Liquidity risk

Liquidity risk is managed by monitoring forecast cash flows and ensuring that adequate unutilised
borrowing facilities are maintained, where possible.

Credit risk

The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance
date to recognised financial assets, is the carrying amount, net of any provisions for impairment of those
assets, as disclosed in the balance sheet and notes to the financial statements. In the education business,
credit risk is minimised by, generally, collecting tuition fees in advance

Financial Instruments

Interest Rate Risk

The consolidated group’s exposure to interest rate risk, which is the risk that a financial instrument’s value
will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates
on classes of financial assets and financial liabilities, is as follows:

Note Weighted Floating Fixed interest maturing in: Non-

average
interest
rate

interest
rate

1 year
or less

1 to 5
years

Interest
bearing

Total

$000s

2014
Financial assets
Cash and cash
equivalents

Trade and other
receivables

Financial liabilities
Trade and other

payables
Bank bills
Lease purchase
agreements

18
19

1.02%

7,833

5.67%

10.90%

-
7,833

-
-

- 52 -

-
-

-
1,238

81
1,319

-
-

-
2,503

162
2,665

7,833

15,023
15,023

18,852
-

-
18,852

15,023
22,856

18,852
3,741

243
22,836

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

28. FINANCIAL INSTRUMENTS (continued)

Note Weighted Floating Fixed interest maturing in: Non-

average
interest
rate

interest
rate

1 year
or less

1 to 5
years

Interest
bearing

Total

$000s

2013
Financial assets
Cash and cash
equivalents
Trade and other
receivables

Financial liabilities
Trade and other

18
payables
Bank bills
19
Bank Trade refinance 19
Lease purchase
agreements

1.13%

4,992

-
4,992

-
-
-

-
-

8.62%
4.84%

8.93%

-
-

-
919
46

4
969

-
-

-
2,402
-

-
2,402

2,417
2,417

6,327
-
-

-
6,327

4,992

2,417
7,409

6,327
3,321
46

4
9,698

ii.

Net fair values of financial assets and liabilities

The carrying amounts of financial assets and liabilities approximate their net fair value.

iii.

Amounts payable in foreign currencies
The Australian dollar equivalents of unhedged amounts payable or receivable in foreign currencies
calculated at year end exchange rates, are as follows:

United States Dollars

Amounts payable

2014
$000s

2013
$000s

189

iv.

In addition the group holds investments recognised at fair value of $2,618,000 (2013: $509,000). The basis
for fair value is disclosed in Note 1.

Sensitivity Analysis

The following table illustrates sensitivity analysis to the group’s exposure to changes in interest rates. The
table indicates the estimated impact on how profit and equity values reported at the end of the reporting
period would have been affected by changes in the interest rate that management considers reasonably
possible.

2014

+/- 2% in interest rates

Profit

Equity

- 53 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

29. NEW ACCOUNTING STANDARDS FOR APPLICATION IN FUTURE PERIODS

Management have considered all standards and interpretations issued but not yet effective and do not believe that any
will have a material impact on the financial report. No new standards and interpretations have been adopted early.

30. PARENT INFORMATION

The following information has been extracted from the books of the parent and has been prepared in accordance with
Australian Accounting Standards

STATEMENT OF FINANCIAL POSITION

2014
$000s

2013
$000s

Assets
Current assets
Non-current assets
Total Assets

Liabilities
Current Liabilities
Non-current liabilities
Total Liabilities

Equity
Share capital
Retained earnings
Total Equity

STATEMENT OF COMPREHENSIVE INCOME

Total profit

Total comprehensive income

21,309
4,431
25,740

170
748
918

32,534
(7,713)
24,821

4,874

6,101
5,173
11,274

486
745
1,231

18,372
(8,329)
10,043

1,669

- 54 -

ACADEMIES AUSTRALASIA GROUP LIMITED
NOTES TO THE FINANCIAL STATEMENTS
For the year ended 30 June 2014

31. COMPANY DETAILS

The registered office of Academies Australasia Group Limited is:

Level 6
505 George Street
Sydney NSW 2000

The principal places of business as at 3 September 2014 are:

NEW SOUTH WALES

VICTORIA

Academies Australasia Institute
Academy of English
Australian College of Technology
Australian International High School
Clarendon Business College
Supreme Business College
Level 6, 505 George Street
Sydney, NSW 2000

Benchmark College
140 Henry Street, Penrith, NSW 2750

College of Sports & Fitness
12 Wentworth Avenue, Darlinghurst, NSW 2010

RuralBiz Training
46 Wingewarra Street, Dubbo, NSW 2830

Academies Australasia Polytechnic
Level 7, 628 Bourke Street
Melbourne,VIC 3000

Discover English
378 Bourke Street, Melbourne, VIC 3000

Spectra Training
100 Dorcas Street, Melbourne, VIC 3205

Vostro Institute
82-96 Hampstead Road, Maidstone, VIC 3012

SOUTH AUSTRALIA

Print Training Australia
Unit 17, 169 Unley Road, Unley, SA 5061

QUEENSLAND

Brisbane School of Hairdressing
Brisbane School of Beauty
Queen Adelaide Building
90-112 Queen Street Mall
Brisbane, QLD 4000

Gold Coast School of Hairdressing
Shop G105, Australia Fair Shopping Centre
Southport, QLD 4215

WESTERN AUSTRALIA

Language Links
90 Beaufort Street, Perth, WA 6000

SINGAPORE

Academies Australasia College
51 Middle Road, Singapore 188959

***

- 55 -

ACADEMIES AUSTRALASIA GROUP LIMITED
AND CONTROLLED ENTITIES
DIRECTORS’ DECLARATION

The directors of the Company declare that:

the financial statements and notes, set out on pages 20 to 55, are in accordance with the Corporations Act
2001 and

(i) comply with Accounting Standards which, as stated in accounting policy Note 1 to the financial
statements, constitutes explicit and unreserved compliance with International Financial Reporting
Standards (IFRS); and

(ii) give a true and fair view of the financial position as at 30 June 2014 and of the performance for the

year ended on that date of the Company and consolidated group.

2. The Chief Executive Officer and Chief Financial Officer have each declared that:

(i)

the financial records of the company and the consolidated group for the financial year have been
properly maintained in accordance with s 286 of the Corporations Act 2001;

(ii) the financial statements and notes for the financial year comply with Accounting Standards; and

(iii) the financial statements and notes for the financial year give a true and fair view, and

3. In the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable. The Company and wholly owned subsidiaries
identified in Note 14 but excluding those in Note 23, have entered into a deed of cross guarantee under
which the Company and its subsidiaries guarantee the debts of each other.

At the date of this declaration, there are reasonable grounds to believe that the companies which are party to
this deed of cross guarantee will be able to meet any obligations or liabilities to which they are, or may
become subject to, by virtue of the deed.

This declaration is made in accordance with a resolution of the Board of Directors.

Dr John Lewis Schlederer
Director

3 September 2014

Christopher Elmore Campbell
Director

- 56 -

ACADEMIES AUSTRALASIA GROUP LIMITED
AND CONTROLLED ENTITIES
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

Additional information required by the Australian Securities Exchange Limited and not shown
elsewhere in this report is as follows.

SUBSTANTIAL HOLDERS

Ordinary Shares

The relevant interests of substantial shareholders as at 2 September 2014 were:

Shareholder

No. of Shares Held

Mr Chiang Meng Heng
b
Mr Christopher Elmore Campbell
Jilcy Pty Ltd Jilcy Super Fund A/C
c
Raphael Geminder
d
Gary Cobbledick
Eng Kim Low
ACN 166 970 565 Pty Ltd
Pie Funds Management Limited

24,941,886
7,416,767
6,912,767
4,979,605
4,933,041
3,779,126
3,409,091
3,203,174

40.19
11.95
11.14
8.02
7.95
6.09
5.49
5.16

a Includes 3,779,126 shares held by Eng Kim Low
b

Includes 6,912,767 shares held by Jilcy Pty Ltd Jilcy Super Fund A/C and 500,000 shares held by Bankura
Pty Ltd Campbell Family Trust A/C

c 4,006,396 held BB&M Holdings Pty Limited and 973,209 held by Geminder Holdings Pty Limited
4,006,396 held BB&M Holdings Pty Limited and 926,645 held by Stormont Pty Limited.
d

VOTING RIGHTS

Ordinary Shares

At 2 September 2014 there were 418 holders of the ordinary shares of the Company. The voting rights
attaching to the ordinary shares, set out in Articles 69 and 70 of the Company’s Articles of
Association, are:

Article 69
“Subject to these Articles and any rights or restrictions for the time being attached to any class or
classes of shares:
(a) at meetings of members or classes of members each member entitled to attend and vote may
attend and vote in person or by proxy, or attorney and (where the member is a body corporate)
by representative;

(b) on a show of hands, every Member present has 1 vote;
(c) on a poll, every Member present has:

(i) 1 vote for each fully paid share; …….”

Article 70
“Where more than 1 joint holder votes, the vote of the holder, whose name appears first in the register
of members shall be accepted to the exclusion of the others.”

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ACADEMIES AUSTRALASIA GROUP LIMITED
AND CONTROLLED ENTITIES
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES

20 LARGEST SHAREHOLDERS AS AT 2 SEPTEMBER 2014

Registered Name

No. Shares

1 Mr Chiang Meng Heng
Jilcy Pty Ltd Jilcy Super Fund A/C
2
BB&M Holdings Pty Limited
3
Eng Kim Low
4
ACN 166 970 565 Pty Ltd
5
Citicorp Nominees Pty Limited
6
National Nominees Limited
7
Catholic Church Insurance Limited
8
Vasek Fasteners Pty Ltd Premier Screw Super A/C
9
J&B Schlederer Pty Ltd J&B Schlederer super A/C
10
Geminder Holdings Pty Limited
11
12
Stormont Pty Limited
13 Mrs Gail Leslie Storey
14
15 Ms Anthea Judith Drescher
Frank Kwong-Shing Wong
16
JP Morgan Nominees Australia Limited
17
18
Daniel Hing Yuen Wong Jehovah Jireh Family A/C
19 Moat Investment Pty ltd < Moat Investment A/C
20

Equitas Nominees Pty limited < 3021524 A/C

Bankura Pty Ltd Campbell Family Trust A/C

21,162,760 34.10
6,912,767 11.41
6.46
4,006,396
6.09
3,779,126
5.49
3,409,091
5.17
3,209,566
4.68
2,902,743
2.59
1,607,860
2.50
1,553,529
1.59
987,140
1.57
973,209
1.49
926,645
1.02
634,335
0.77
476,000
0.71
439,922
0.61
380,000
0.58
359,806
0.55
340,000
0.48
300,000
0.42
259,750

54,620,645

88.01

HOLDING RANGE (SHAREHOLDERS) AS AT 2 SEPTEMBER 2014

Range
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000

100,001 +

No. Holders
70
146
65
100
37
418

Total No. Shares

49,854
427,437
503,545
3,729,237
57,353,411
62,063,484

%
0.08
0.69
0.81
6.01
92.41
100.00

UNMARKETABLE PARCELS AS AT 2 SEPTEMBER 2014

Minimum $500.00 parcel at $1.375 per
unit

360

2,303

Minimum Parcel Size

No. Holders

Units

* * *

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OFFICES AND OFFICERS

DIRECTORS

Dr John Lewis Schlederer

Chairman (Independent & Non-
Executive)

Christopher Elmore Campbell

Group Managing Director

Chiang Meng Heng

Director (Non-Executive)

Gabriela Del Carmen Rodriguez
Naranjo

Director (Executive)

COMPANY SECRETARY

Stephanie Ann Noble

REGISTERED OFFICE

Academies Australasia Group Limited
Level 6
505 George Street
Sydney NSW 2000

Telephone: (02) 9224 5555
(02) 9224 5550
Facsimile:

Web Site: www.academies.edu.au

SHARE REGISTRAR

Computershare Investor Services Pty Limited
Level 3
60 Carrington Street
Sydney NSW 2000

Telephone: (02) 8234 5000
Toll Free (Australia only) 1300 850 505
Facsimile:

(02) 8234 5050

SECURITIES EXCHANGE

The Company is listed on the Australian Securities Exchange. The
Home Exchange is Sydney.

ASX Code:

AKG

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