think.build.connect.maintain
Appendix 4E
Results for Announcement to
the Market and Annual Report
BSA Limited
50 088 412 748
FOR THE YEAR ENDED 30 JUNE 2017
CONTENTS
- APPENDIX 4E
- ANNUAL REPORT
RESULTS FOR ANNOUNCEMENT TO THE MARKET
FOR THE PERIOD ENDED 30 JUNE 2017
PREVIOUS CORRESPONDING PERIOD 30 JUNE 2016
APPENDIX 4E
Revenue from ordinary activities
Down
(3.8%)
Profit from ordinary activities after income tax attributable to members
Up
278.6%
Net profit for the period attributable to members
Up
278.6%
to
to
to
$’000
492,317
3,963
3,963
2016
cents
(0.52)
(0.52)
3.63
2017
cents
0.94
0.93
5.14
Franked amount per
Amount per security
security at 30% tax
(cents)
(cents)
Nil
0.50
Nil
0.50
Basic earnings per share
Diluted earnings per share
Net tangible asset backing per ordinary share
DIVIDENDS
Interim dividend (fully franked)
Final dividend (fully franked)
Record date for determining entitlement to dividends
12 October 2017
Payment date of dividend
Total dividend payable
2 November 2017
$2,115,000
The company’s Dividend Reinvestment Plan is not in operation for this dividend.
None of this dividend is foreign sourced.
This report is based on the consolidated financial statements which have been audited by Deloitte Touche Tohmatsu, with the Independent Auditor’s Report
included in the financial statements.
BSA LIMITED RESULTS FOR ANNOUNCEMENT TO THE MARKET
think.build.connect.maintain
2017
BSA LIMITED
ANNUAL REPORT
BSA ANNUAL REPORT 2017
BSA | Build is providing a full Mechanical Services Package for Monash
Clayton in VIC including Laboratory Gases, Gas Detection Systems and
Fume Cupboards
The image above shows 2 plant decks of 5 for the fume cupboard exhaust
stacks. As part of the contract works 150 fume cupboards in total were installed.
2
BSA LIMITED ANNUAL REPORT 2017 CONTENTS
Chairman’s Report - 4
Managing Director’s Report - 6
Directors’ Report - 14
Remuneration Report - 17
Auditor’s Independence Declaration - 28
Financial Report - 30
Directors’ Declaration - 86
Independent Auditor’s Report - 87
Shareholder Information - 92
Corporate Directory - 94
3
BSA LIMITED ANNUAL REPORT 2017 CHAIRMAN’S REPORT
Michael Givoni
Chairman
For BSA, 2017 has been a successful year in that we have resolved
key legacy issues, bolstered the executive team, and significantly
enhanced our business development focus. These achievements,
in addition to our strong balance sheet ensure that BSA is well
placed for the year ahead and to take advantage of strategic growth
opportunities in the future.
Coming into 2017 the two major legacy issues requiring resolution
were the NSW Office of State Revenue (OSR) matter and the new
Royal Adelaide Hospital (nRAH) project. As previously announced
to the market, BSA signed a settlement deed with the project’s
Head Contractor (a joint venture between Hansen Yuncken and CPB
(formerly Leighton Contractors)). The deed resulted in a cash receipt
of $5.3 million but negative impact on EBITDA of $2.6 million. There
are a number of commercial issues which require resolution including
more recent variations which BSA consider clear scope changes.
Whilst outside the reporting period, we have also made progress
on the NSW OSR matter. BSA reached an in principle commercial
settlement with the OSR in August 2017, which signals an end to
this long running and complex tax issue. An additional provision for
the impact of this settlement has been recognised in the FY2017
financial statements.
The BSA Management Team was bolstered during the year by the
appointment of our Chief Operating Officer, Tim Harris. This critical
BSA | Build provides Mechanical
and Fire services to the
International Convention Centre
Hotel, Sydney
Basic earnings per share of 0.94 cents (2016: basic loss per share of
0.52 cents)
Final dividend declared 0.5 cents per share (2016: Nil)
BSA | Build continued its strong business development focus and
after securing a number of major contract wins throughout the
year enters 2018 with a record order book of $251 million. The Fire
business has continued its expansion focus and the Queensland Fire
business is now well established and contributing to the
move has enabled our Chief Executive Officer (Nicholas Yates) and
Group result.
Chief Financial Officer (Nick Benson) to return to more traditional
roles. Since commencing in September 2016, Tim has made a
positive impact in terms of restructuring and refining our operational
processes and strengthening the commercial practices within our
business unit teams.
A detailed review of our results is provided within the Managing
Director’s report; however the key highlights are as follows:
Revenue $492.3 million (2016: $511.9 million)
EBITDA $11.1 million (2016: $4.1 million)
EBITDA excluding significant items $17.8 million (2016: $18.6 million)
Whilst the BSA | Connect result was impacted by the NSW OSR
settlement and lower than anticipated revenues across some clients,
the team has had a successful year in terms of mobilisation of key
contracts awarded in the previous year (including nbn works) and
the successful launch into the electrical metering space.
BSA | Maintain has delivered a significant margin improvement in
FY2017. Business development has also been a key priority for this
Business Unit, resulting in the growth of annuity revenue by $10 million
compared with the previous year.
2017 has also been a successful year in relation to workplace health
and safety, with BSA exceeding targets across all key metrics in
NPAT $4.0 million (2016: loss $2.2 million)
this arena.
NPAT excluding significant items $8.7 million (2016: $8.0 million)
Operating cash outflow $0.8 million (2016 inflow $2.0 million)
We are pleased to announce the return to dividend payments in 2017.
A dividend of ½ cent per share will be paid on 2 November 2017 for all
shares on the register as at 12 October 2017.
4
BSA LIMITED ANNUAL REPORT 2017 The market outlook remains positive for the sectors in which we
operate and the Group has also identified a number of opportunities
for expansion into new markets. As mentioned, the Group is
confidently entering 2018 with a solid forward order book and
contracted recurring revenue streams. These factors, combined with
the resolution of key legacy issues and strengthened management
team, should signal the emergence of a sustainable growth period
for BSA.
BSA has again enjoyed a robust and supportive relationship with its
financiers throughout FY2017 and we look forward to their continued
support in FY2018.
On behalf of the Board I would like to thank our CEO, Nicholas Yates,
the executive team and their staff for their continued efforts and
ongoing commitment to our customers and shareholders.
I would like to acknowledge my fellow Directors for their
contribution to BSA and for their support during FY2017.
Michael Givoni
Chairman
28 August 2017
KEY
HIGHLIGHTS
$492.3 million
Revenue
$11.1 million *
EBITDA
$4.0 million
NPAT
* Reconciliation on page 13
5
BSA LIMITED ANNUAL REPORT 2017 MANAGING DIRECTOR’S REPORT
OPERATIONAL AND FINANCIAL HIGHLIGHTS AND OUTLOOK
FY2017 has seen BSA undertake a series of essential programs. Necessary work was undertaken on a
number of outstanding legacy issues, with headway made on all fronts. As announced at the 2016 AGM, the
Group appointed Tim Harris as Chief Operating Officer during the year. The key focus for this role has been
margin improvement and further development of project controls; even at this early stage we are seeing
tangible results.
I have personally led a renewed focus on Business Development continued throughout the year, with this
investment yielding results both in the areas of expansion into new contracts with existing clients and also
diversification into new markets such as metering and energy. We are pleased that for the second reporting
period in a row we can report a group record order book.
Nicholas Yates
Managing Director and
Chief Executive Officer
6
BSA LIMITED ANNUAL REPORT 2017 GROWTH
to the BSA Business Process Framework which are:
The Group launched into FY2018 with a construction forward order
book increased to $251 million and annualised recurring revenues
of $309 million.
Along with steady growth in our existing markets, we are well on
the way to expansion of our services and diversification into new
markets. BSA has invested in a CEO Incubator program, designed
to analyse new markets and service offerings whilst not detracting
from our core focus on margin improvement. This program was the
launchpad for our ventures into both the smart metering and solar
markets where we anticipate further expansion within FY2018 and
beyond.
HEALTH SAFETY, ENVIRONMENT & QUALITY (HSEQ)
FY2017 has seen excellent outcomes in Health and Safety. Once
again BSA has well and truly exceeded the targeted 20% reduction
in Total Recordable Injury Frequency Rate (TRIFR), with a reduction
of 49%. This trend is indicative of a maturing approach to Health and
Safety and a higher priority on medical treatment injuries.
The coming year will see the formal roll-out of the enhanced BSA
•
•
•
•
•
The recognition of BSA’s Basic Safety Attitudes;
To have workers who are capable, competent, aware,
engaged & resourced whilst being personally accountable for
their actions;
To enhance BSA’s ways of operating through the embedding
of processes & systems that provide a standard and value
adding way of working that applies the recognition of
change;
To focus upon hazard identification and risk management
in all areas of the business through the identification and
management of Significant Risk Activities; and
To proactively strengthen the HSEQ culture through the
focus on present and felt leadership.
COMMUNITY SUPPORT
During the year BSA, its subsidiaries and its employees, contributed
to a number of charity fundraisers including Property Industry
Foundation, Everyday Hero, Love Mercy Foundation, Oxfam Australia
Trailwalker, Redkite, the SNRLFC “Sleepy’s Cancer Day” and Toy’s for
Group Induction. This will continue to embed the concepts intrinsic
Kids Christmas Appeal. We also continued our longstanding support
of Youngcare through the provision of services in-kind.
7
BSA LIMITED ANNUAL REPORT 2017 MANAGING DIRECTOR’S REPORT
Demonstrating the benefits of the Foxtel App for online content
streaming during a Foxtel IQ3 customer installation appointment.
BSA | CONNECT
BSA | Connect has continued to consolidate its market position
as a leading national provider of telecommunications operations
(HFC) into the Brisbane and Melbourne markets. Whilst initial nbn
volumes received during FY2017 were below expectations, which
& maintenance services and large scale workforce management
impacted FY2017 revenue & earnings, pleasingly, the business has now
solutions. Our focus on operational excellence, service diversification,
started to see a ramp up of volumes across both contracts.
margin improvement and growth has continued throughout FY2017,
with the business unit delivering an EBITDA result of $9.5 million. This
result represents a $1.8 million or 23% increase from the prior year and
was also after a $2.5 million additional provision taken to settle the
NSW OSR Issue.
BSA | Connect is now covering the
emerging market sectors of Solar,
Energy and connected services via the
Internet of Things (IoT).
FY2017 has seen a ramp up in our operational resourcing & capability
to support the mobilisation of a number of key contracts awarded
BSA | Connect successfully renegotiated and extended agreements
with longstanding clients Foxtel and Optus within the year. In addition,
during FY2016 and early FY2017. Significant mobilisations undertaken
Registered Training Organisation (RTO), Blue Sky Academy continues
in the year include both the nbn Operate and Maintain (OMMA)
to complement the business unit operations, providing accredited
contract awarded in December 2015 and nbn Multi-technology
training support across all key platforms.
Integrated Master Agreement (MIMA) contract awarded in July 2016.
The nbn MIMA contract covers the architecture solutions required to
deploy nbn’s fixed line broadband network and Hybrid Fibre Coax
Business Development continues to be a key priority, covering both core
telecommunication sector (both fixed line & mobile) and diversification
of client offerings and market segments including the emerging markets
8
BSA LIMITED ANNUAL REPORT 2017 BSA metering technician undertaking a residential advanced
metering installation as part of the “Power of Choice” rollout.
sectors of Solar, Energy and connected services via the Internet of
Things (IoT). In addition to nbn MIMA, key contracts that we have
successfully launched during FY2017 include:
•
Ericsson three year services agreement to provide a broad range
of field services including Fixed Wireless and Satellite Connection
Service Australia-wide;
•
Awarded a new services agreement with Fox Sports for installation
and maintenance services; and
•
Agreement with Vector to provide Smart Metering field services.
This contract provides a significant opportunity for the business to
leverage upcoming changes to the National Electricity Market from
December 2017 onwards.
FY2017 has been a period of significant change, optimisation &
rationalisation and the business is well placed both operationally and
strategically to further capitalise on opportunities within the sectors in
which we choose to operate.
BSA | Connect
$186.5 million
Revenue
[2016: $205.7 million]
$9.5 million *
EBITDA
[2016: $7.7 million]
NB: Excludes Corporate Recharges
9
BSA LIMITED ANNUAL REPORT 2017 BSA | Maintain
$89.5 million
$4.7 million *
Revenue
EBITDA
[2016: $79.9 million]
[2016: 2.0 million]
NB: Excludes Corporate Recharges
BSA | Maintain provides programmed maintenance on the mechanical services equipment for
Canberra’s New Acton Nishi Base Building and Cinemas. This includes the Annual fire shut down
of the HVAC equipment and Annual Thermal Scan of all mechanical switch boards.
10
BSA LIMITED ANNUAL REPORT 2017 MANAGING DIRECTOR’S REPORT
BSA | Maintain have been providing services to
Sonic’s pathology labs located at North Ryde.
These services have been ongoing for the past
10 years and include preventative maintenance
to their Air-conditioning and Ventilation systems.
BSA | MAINTAIN
BSA | Maintain revenue increased by 12% to $89.5 million as the
business unit continued its focus on building recurring annuity style
maintenance revenue and expanding its National Contract capabilities.
•
•
Honeywell (WA)
Newscorp (National)
The business unit delivered a 135% increase in EBITDA compared with
the previous year. This increase was achieved primarily as a result of a
number of key profitable maintenance contracts, primarily in Western
Australia and Victoria, which have yielded significant pull through.
A significant change in executive and senior management was
implemented towards the end of the reporting period. This was done
to maintain strong operational performance underpinned by a culture
of disciplined and focused customer service. BSA | Maintain remains a
market leader through the provision of industry leading maintenance
services in Heating, Ventilation & Air Conditioning (HVAC), Fire and
Multi-Services and is aiming to build on this capability in the future.
BSA | Maintain has secured a number of substantial new contracts
during the year which is reflected in the revenue growth. Key contracts
won include:
•
•
•
•
Sydney Cricket and Sports Ground Trust (NSW)
Global Switch (NSW)
Telstra (National)
Shell (WA)
Our successful relationships with key clients Monash University,
Harvey Norman, Broadspectrum and Spotless Defence continued
throughout the year, contributing to the increased revenue results for
the Business Unit.
The following key contract extensions have been secured during the
financial year:
•
•
•
•
Ausgrid
Fiona Stanley
Suncorp Stadium
Sydney Water
• Westfield
•
Honeywell
Work has continued to unite the BSA | Build and BSA | Maintain
teams across the HVAC, Fire and Multi Service sectors, in order
to deliver life cycle asset solutions in the HVAC and Fire market
segments, underpinned by an increased focus on BSA’s Advisory
services and specifically energy efficiency solutions. The goal is to
provide these services in every capital city across Australia.
11
BSA LIMITED ANNUAL REPORT 2017 BSA | Build completed works at 1 Parramatta
Square which comprised of the design, engineering,
drafting, supply, installation and commissioning of
the mechanical services systems.
BSA | Build
$216.6 million
Revenue
[2016: $226.4 million]
$1.4 million *
EBITDA
[2016: $1.5 million loss]
NB: Excludes Corporate Recharges
BSA | BUILD
During 2017, the operational structure of BSA | Build was further
streamlined and refocused to optimise our market offering of leading
improved profitability is continuing. The poor financial results were
largely as a consequence of the previously announced nRAH settlement
design and construct solutions in HVAC systems and Fire Protection.
and completion costs of $2.6 million along with tougher than expected
Geographically the business is present in all major state capital cities
conditions in Queensland.
across Australia.
During the year the Group undertook the consolidation of the Sydney
and Brisbane HVAC divisions. The restructuring has impacted the
EBITDA during the year with net losses of $3.3 million. These changes
will result in a significant financial improvement in the HVAC divisions in
2018 and beyond.
All businesses within BSA | Build continued to establish and maintain
their status as tier 1 solution providers with end-to-end in-house
capability in the Fire and HVAC sectors.
The new Royal Adelaide Hospital (nRAH) project reached
commercial acceptance during the financial year and accepted its
In FY2017 BSA | Build delivered works on a large number of landmark
projects in almost every state. Examples include:
•
•
Global Switch East Stage 2 (NSW)
International Convention Centre Hotel (NSW)
• Williamtown RAAF Base (NSW)
•
•
•
•
•
Macarthur Square (NSW)
Capital Square T1 (WA)
1 Parramatta Square (NSW)
RACV Cape Schanck Resort Development (VIC)
664 Collins Street Melbourne (VIC)
first patient on 14 August 2017. We have been focusing on remaining
• Whitford City Stage ELP (WA)
a significant market player in South Australia. This was achieved
through the award of the design and construct contract for the
Calvary Hospital worth $23.4 million.
The ongoing redesign and re-embedding of key functional disciplines
to facilitate enhanced project delivery; improved risk mitigation and
•
La Trobe University Donald Whitehead Building (VIC)
BSA | Build enters FY2018 with significant work in hand of $251
million with further opportunities across Australia. During FY2017 the
business unit was awarded a number of signifigant projects including
the following:
12
BSA LIMITED ANNUAL REPORT 2017 MANAGING DIRECTOR’S REPORT
•
•
•
•
•
•
•
•
•
•
The Glen Shopping Centre (VIC)
Blacktown Hospital (NSW)
Battlefield Airlifter Project (QLD)
Sunshine Coast Plaza – Fire (QLD)
North East Plot DA – Fire (NSW)
ITB Northern HVAC Upgrade (QLD)
QT Hotel (WA)
Mascot Tunnel (NSW)
Brookside Shopping Centre (QLD)
105 Phillip St Parramatta – Fire (NSW)
BSA has commenced building business value propositions for
customers across their asset lifecycles as well as other value add
services. Renewable Energy advisory has commenced to key clients
within BSA | Build; the purpose of which is to align with prospective
clients earlier and provide detailed solar energy design solutions
and procurement advisory services in advance of bid work and final
contract awards.
Our FY2018 focus will include significant targeted projects as we
continue to build a solid disciplinary foundation in the way we win,
execute and maintain our projects.
OSR
While after the close of the Financial Year, BSA Limited has reached a
commercial settlement in principle with the NSW OSR in relation to our
long running dispute concerning payroll tax. The settlement has had an
impact on the year’s results but now draws a line under the longest running
and most complex BSA legacy issue. The cash impact of the settlement
arrangement has been mitigated by way of a three year payment plan.
Nicholas Yates
Managing Director and
Chief Executive Officer
28 August 2017
DISCLOSING NON-IFRS FINANCIAL INFORMATION
Earnings before Interest, Tax, Depreciation and Amortisation (EBITDA)
FY2017
A$’000
FY2016
A$’000
3,963
(2,219)
Profit/(loss) for the year from
continuing Operations
Add back
nRAH
Income tax expense/(benefit)
1,671
(795)
As previously advised to the market, in November 2016 BSA Limited
executed a deed of settlement in relation to its contract on the new
Royal Adelaide Hospital project in Adelaide. The deed provided for
the resolution of a number of significant outstanding claims and
disputes. The remaining works undertaken since the execution of the
deed in November are currently under negotiation and largely relate to
instructed scope changes.
Finance costs
Interest revenue
Depreciation
Amortisation expense
EBITDA
Total Significant Items (note 8.5)
595
(166)
4,260
738
11,061
6,751
EBITDA excluding Significant Items
17,812
741
(96)
5,029
1,440
4,100
14,534
18,634
The main plant room in the Royal Victorian Eye & Ear
Hospital East Melbourne. A Full Mechanical Services
Installation was undertaken by BSA | Build including new
Emergency Department and Operating Theatres.
13
BSA LIMITED ANNUAL REPORT 2017
DIRECTORS’ REPORT
THE BOARD OF DIRECTORS PRESENTS ITS REPORT
The Directors of BSA Limited (‘BSA’ or the ‘Company’) present their report on the Company and its
subsidiaries for the financial year ended 30 June 2017.
THE BOARD OF DIRECTORS AS AT 30 JUNE 2017
MICHAEL GIVONI
CHAIRMAN (NON-EXECUTIVE)
Mr Givoni has had extensive executive
experience in the business-to-business (B2B)
areas of commerce. His particular area of
expertise is in strategy, business development
and mergers and acquisitions. Michael has
PAUL TEISSEIRE
NON-EXECUTIVE DIRECTOR
Mr Teisseire is a professional independent
Non-Executive Director. He spent over 20
years in private practices as a corporate lawyer
specialising in business and corporate law with
a special interest in corporate governance.
held senior executive roles in listed companies including Spotless Group
He is a Non-Executive Director of Drake Supermarkets Pty Ltd. Paul
Ltd. Prior to his executive career, Michael was a partner in a prominent
was appointed as a Non-Executive Director on 23 March 2005 and is
Melbourne legal practice. Michael joined BSA as a Non-Executive
currently Chair of the Audit Committee.
Director on 23 March 2005 and was appointed as Chairman from 29
April 2015. He holds a number of other Non-Executive Director and
Chair roles in significant privately owned businesses including Winslow
Group, RSEA, First5Minutes and Buzz Products.
NICHOLAS YATES
MANAGING DIRECTOR AND CHIEF
EXECUTIVE OFFICER
MAX COWLEY
NON-EXECUTIVE DIRECTOR
Mr Cowley practised as Principal of Chartered
Accounting firm E M Cowley & Co for 47
years. His years of corporate and financial
experience are extensive. Max is a director
of WIN Corporation Pty Ltd, Australia’s
Mr Yates graduated with a Bachelor of
largest regional television network and has been involved with that
Engineering (Mechanical) from the University
organisation from its commencement and over the past 36 years. Max
of Sydney and went on to forge an extensive
is a Director of a number of Private Companies. Having previously
career in the building services and facilities
served on the Board of BSA from 2 May 2006 until 27 November 2012,
management industries. Commencing as a site engineer overseeing
Max was appointed as a Non-Executive Director on 14 April 2014.
mechanical services installations, Nicholas then progressed through
various management roles within Lend Lease and eventually moved
on to become CEO of APP Corporation Pty Limited, Australia’s leading
Construction Project Management consulting business. When APP
was acquired by Transfield Services, Mr Yates moved into a series
of leadership roles within Transfield Services, most recently Chief
Executive Officer, Infrastructure ANZ. Nicholas sits on the Boards of a
number of private companies and was appointed Managing Director
and Chief Executive Officer of BSA Limited on 13 March 2014.
MARK LOWE
NON-EXECUTIVE DIRECTOR
Mr Lowe was appointed as a Director of BSA
on 1 August 2007 upon completion of the
acquisition of the Triple ‘M’ Group. Mark brings
a wealth of knowledge to the Company from
GRAEME BARCLAY
NON-EXECUTIVE DIRECTOR
Mr Barclay has extensive experience in
executive leadership and strategic development
in areas that brings valuable skills to the BSA
board and company. Mr Barclay successfully
led all aspects of a major telecommunications
group for more than a decade in the role of Group CEO with responsibility
for financial performance, strategy, sales, corporate development,
international expansion, operations and capital structure.
Mr Barclay also has senior executive level experience within
investment banking and chartered accounting businesses, with
responsibilities including property investment banking, corporate
finance and corporate restructuring.
his 30 years’ experience in the installation
Mr Barclay is a member of the Australian Institute of Company Directors,
and maintenance of Air Conditioning and Fire
a Fellow of the Financial Services Institute of Australasia and is a qualified
Protection Services. He is a former Director of Construction Information
Chartered Accountant in Scotland and Australia/NZ. Mr Barclay is
Systems Limited (NATSPEC) and a former National President of the Air
currently a Director and Non-Executive Chairman of MGH Holdco Pty Ltd
Conditioning Mechanical Contractors Association of Australia. Following
and a Non-Executive Director of Codan Limited and of Axicom Group
his retirement from executive duties Mark was appointed a Non-
Holdings Pty Limited. Graeme was appointed as a Non-Executive Director
Executive Director on 2 March 2012.
on 30 June 2015, and is currently Chair of the Remuneration Committee.
14
BSA LIMITED ANNUAL REPORT 2017 BSA | Build Engineer reviewing concepts for innovation opportunity
DIRECTOR INDEPENDENCE
Company Secretary for Legend Corporation Limited, Erinbar Limited
The Board considers three of BSA’s Directors independent, as defined
under the guidelines of the ASX Corporate Governance Council, being:
Michael Givoni, Paul Teisseire and Graeme Barclay.
and UXA Resources Limited.
ENVIRONMENTAL REGULATION AND PERFORMANCE
In assessing the independence of Directors, the Board follows the ASX
guidelines as set out in the Corporate Governance Statement on the
BSA was not subject to any particular or significant environmental
regulations of the Commonwealth, individual states, or territories,
Company’s website.
during the financial year.
PERFORMANCE OF DIRECTORS
CORPORATE GOVERNANCE
In accordance with Principle 2.5 of the ASX Corporate Governance
Principles and Recommendations, the Board conducts a review of
the performance of its Directors and the Board’s function as a whole
each year. The evaluation of Directors is carried out in accordance
with the process established by the Board, led by the chairman of the
BSA continued to follow best practice recommendations as set out by
the ASX Corporate Governance Council. Where the Company has not
followed best practice for any recommendation, explanation is given in
the Corporate Governance Statement which is available on the Company’s
website at www.bsa.com.au/pages/about/corporate-governance.html
Remuneration Committee.
COMPANY SECRETARY
The following person held the position of Company Secretary at the end
of the financial year:
Mr Graham Seppelt - Mr Seppelt has had extensive experience as a
contract accountant and in corporate advisory roles. He is currently
REVIEW OF OPERATIONS
Information relating to the operations of BSA including a description
of principal activities, a review of operations, significant changes in
activities and affairs during the year and likely future developments
and prospects can be found in the Chairman’s Report and Managing
Director’s Report on pages 4 to 13.
15
BSA LIMITED ANNUAL REPORT 2017 DIRECTORS’ REPORT
INFORMATION ON DIRECTORS
As at 30 June 2017, the following information is provided in relation to Directors:
Director
Special Responsibilities
Ordinary Share
Options
Share Rights
Michael Givoni
Non-Executive Director
Chairman of Board
Member of Remuneration Committee
Member of Audit Committee
Nicholas Yates
Executive Director
Managing Director
Max Cowley
Non-Executive Director
Member of Remuneration Committee
Member of Audit Committee
Paul Teisseire
Non-Executive Director
Member of Remuneration Committee
Chairman of Audit Committee
Mark Lowe
Non-Executive Director
Member of Remuneration Committee
Member of Audit Committee
Graeme Barclay
Non-Executive Director
Chairman of Remuneration Committee
Member of Audit Committee
796,400
Nil
Nil
2,727,273
Nil
1,116,667
67,204,000*
Nil
Nil
680,012
Nil
Nil
10,315,403
Nil
Nil
Nil
Nil
Nil
*Max Cowley is a director of Birketu Pty Ltd which holds the 67,204,000 ordinary shares in BSA Limited.
At the date of this Annual Report, there has been no change to the above directors’ interest in shares, rights or options.
BSA | Build are providing full Mechanical Services Installation to RACV Cape Schanck Resort VIC including 100 Hotel Rooms, Restaurant, Bar, Pool and Golf Club.
16
BSA LIMITED ANNUAL REPORT 2017 DIRECTORSHIPS HELD IN OTHER LISTED ENTITIES
Period of Appointment
Name of Company
Position Held (Non-Executive or Executive Director)
Graeme Barclay
Appointed 1 February 2015
Codan Limited
Non-Executive Director
REMUNERATION REPORT - AUDITED
This remuneration report details the nature and amount of remuneration
In consultation with external remuneration consultants, the Group
for each key management person of BSA Limited.
has structured an executive remuneration framework that is market
The Company’s policy for determining the nature and amount of
remuneration for Board members and Senior Executives of the
competitive and complementary to the reward strategy of the
organisation.
Company is as follows and is set out under the following main headings:
Alignment to shareholders’ interests:
A.
Principles used to determine the nature and amount of
remuneration
Details of remuneration
Service agreements
Cash bonuses
Share-based compensation
Remuneration Consultants
B.
C.
D.
E.
F.
The information provided in this remuneration report has been audited
as required by section 308(3C) of the Corporations Act 2001.
A.
PRINCIPLES USED TO DETERMINE THE NATURE AND
AMOUNT OF REMUNERATION
The objective of the Group’s executive reward framework is to ensure
reward for performance is competitive and appropriate for the results
delivered. The framework aligns executive reward with achievement of
strategic objectives, the creation of value for shareholders and conforms
to market practice for how the reward is paid. The Board ensures that
executives’ reward satisfies the following key criteria for good reward
governance practices:
•
•
•
•
•
Competitiveness and reasonableness;
Acceptability to shareholders;
Performance linkage/alignment of executive compensation;
Transparency; and
Capital management.
•
Has the achievement of target financial profit as a core
component of performance reward;
•
As well as focusing each executive on key performance metrics
relevant to the role; and
•
Attracts and retains high calibre executives.
Alignment to program participants’ interests:
•
•
•
•
Rewards capability and experience;
Reflects competitive reward for contribution to financial
performance;
Provides a clear structure for earning rewards; and
Provides recognition for contribution.
The framework provides a mix of fixed and variable at-risk pay for
executives and senior managers as well as additional long-term
incentives for the most senior executives. As executives gain seniority
and greater responsibility within the Group, the balance of this mix
shifts to a higher proportion of at-risk rewards.
The Board has established a Remuneration Committee that provides
advice on remuneration and incentive policies and practices, as well
as specific recommendations on remuneration packages and other
terms of employment for Executive Directors, other Senior Executives
and Non-Executive Directors. The Corporate Governance Statement
provides further information on the role of this committee.
17
BSA LIMITED ANNUAL REPORT 2017 DIRECTORS’ REPORT
The table below sets out summary information about the consolidated entity’s earnings and movements in shareholder wealth for the five years to
30 June 2017:
Revenue
Net profit/(loss) before tax
Net profit/(loss) after tax
Share price at start of year
Share price at end of year
Interim Dividend 1
Final Dividend 2
Basic earnings per share
Diluted earnings per share
30 June 2017
30 June 2016
30 June 2015
30 June 2014
30 June 2013
$492.3m
$5.6m
$4.0m
$0.245
$0.340
$511.9m
($3.0)m
($2.2)m
$0.165
$0.245
$543.7m
$491.5m
$474.2m
$5.4m
$3.9m
$0.100
$0.165
($61.3)m
($54.8)m
$0.145
$0.100
$2.8m
$3.8m
$0.200
$0.145
0.00 cps
0.00 cps
0.00 cps
0.00 cps
0.50 cps
0.50 cps
0.00 cps
0.00 cps
0.00 cps
0.00 cps
0.94cps
(0.52)cps
1.11 cps
(23.97) cps
0.93cps
(0.52)cps
1.10 cps
(23.97) cps
1.64 cps
1.60 cps
1 Franked to 100% at 30% corporate income tax rate.
2 Declared after the end of the reporting period and not reflected in the financial statements.
Non-Executive Directors
Fees and payments to Non-Executive Directors reflect the demands
that are made on, and the responsibilities of, the Directors.
The Chairman’s fees are determined independently to the fees of
Non-Executive Directors based on the Director’s experience and
•
•
•
Base pay and benefits, including superannuation;
Short-term performance incentives; and
Long-term incentives through participation in the employee
share scheme, employee option plan and performance
rights plan.
comparative roles in the external market. The Chairman is not present
The combination of these components comprises the executive’s
at any discussions relating to determination of his own remuneration.
total remuneration.
Directors’ and Chairman’s Fees
Base Pay
The current base remuneration for Directors was last reviewed and
Base pay is structured as a total employment cost package which may
determined on 26 June 2012, therefore there has been no increase in the
be delivered as a combination of cash and prescribed non-financial
base remuneration paid to a Director for five years. Directors’ fees are
benefits at the executives’ discretion.
inclusive of superannuation and include the requirement to sit on two
or more Board committees for the duration of their tenure. A Director’s
expected time commitment is a minimum ten hours per month. Directors
are reimbursed actual expenses or paid a per diem allowance for
attendance at the monthly meetings.
Executives are offered a competitive base pay that comprises the
fixed component of pay and rewards. Base pay for Senior Executives is
reviewed annually to ensure the executive’s pay is competitive with the
market and reflects the responsibilities of the position. An executive’s
pay is also reviewed on promotion. There are no guaranteed base pay
Non-Executive Directors’ fees are determined within an aggregate
increases included in the Senior Executive terms of employment.
Directors’ fee pool limit, which is periodically recommended for approval
by shareholders. The maximum currently stands at $600,000 per
Benefits
annum which was approved by shareholders at the Annual General
Executives receive benefits including allowances.
Meeting (AGM) on 26 November 2007. There has been no change to
the aggregate fee pool for non-executive directors for approximately 10
Retirement Benefits
years. The following fees have applied during the year to 30 June 2017:
All employees are eligible to participate in the Company’s default
Base fees
Chairman
Other Non-Executive Directors
superannuation fund. With the change in legislation as at 1 July 2005,
employees can exercise choice as to where their superannuation is paid.
$170,829
$91,560
Short Term Incentives
Non-Executive Directors do not participate in any share or option
incentive plan.
Retirement Allowances for Directors
There are no retirement schemes or retirement benefits, other than
statutory superannuation, paid to Non-Executive Directors.
Executive Pay
Executive remuneration packages include a bonus based on a
combination of the Company achieving a pre-determined profit target
and certain operational pre-determined targets being met. Using a
profit target ensures variable at-risk reward is only available when
value has been created for shareholders and when achieved profit is
consistent with the business plan.
Each executive and senior manager with operational responsibilities
has a Short-Term Incentive (STI) depending on the accountabilities of
The Executive pay and reward framework has three components:
the role and impact on organisation and business unit performance.
18
BSA LIMITED ANNUAL REPORT 2017 The maximum target bonus opportunity is 80% of base salary. To the
This plan provided for the Company to provide loans to executives to
extent an STI bonus is earned, 50% of the bonus is paid in cash, and the
acquire shares. The maximum amount of any loan is not to exceed the
other 50% could be either cash or performance rights, is retained for a
total subscription price for the shares applied for.
period of two years.
The terms of the loan included a provision that no interest is payable by
For the year ended 30 June 2017, the targets under the STI plans were
the Borrower under the Loan Agreement.
based on the group and individual business unit financial objectives. The
target achievement required performance in reducing operating cost,
increasing revenue to deliver an overall increase in EBITDA. The Group
targets apply to the whole of the management team.
The Remuneration Committee is responsible for assessing whether the
targets are met. Targets are set at the beginning of each financial year
and are set for the year. Short-term bonus payments are adjusted in line
with actual performance versus target performance levels. Because short-
All shares are held in escrow until loans are fully repaid. An executive
must not sell, mortgage, charge, assign or otherwise dispose of or
encumber any shares before payment or repayment of any loan
outstanding to the Company.
Subject to this restriction and to the terms of the loan from the
Company (if any), an executive shall from the Date of Allotment, be
the absolute beneficial owner of the shares.
term targets cover several operational areas of the business as well as the
Unless the Directors of the Company otherwise provide in the terms
overall Group target, a proportion of STI may be paid when operational
of any invitation, all Plan Shares shall rank for dividends declared on
targets are achieved although the Group’s overall target may not be met.
or after the Date of Allotment and shall in all respects rank equally
Options
No options were exercised under the BSA options scheme during the year
ended 30 June 2017.
No amounts are unpaid on any shares issued on the exercise of options.
with and have the same rights and entitlements as all other fully paid
ordinary shares of the Company.
No offers were made under the Executive Securities Plan to any Directors
or employees of BSA Limited during the year ended 30 June 2017.
The number of shares held in escrow, and the amount of the outstanding
All options have expired as at 30 June 2017.
loans, as at 30 June 2017 is set out in section E of this report.
No options were granted to any executive, senior manager or director
Employee Performance Rights Plan
during the year. 78,200 options previously granted in connection
with rights granted under the BSA Performance Rights Plan, as a
consequence of the 2014 captial raising, were exercised during the year.
Employee Share scheme
At the AGM held on 25 November 2008, shareholders approved the
introduction of the BSA Employee Performance Rights Plan.
This incentive plan is designed to increase the motivation of eligible key
staff and to create a stronger link between increasing shareholder value
A scheme under which shares were issued by the Company to employees
and employee reward.
for no cash consideration was ratified by shareholders at the 2004 AGM.
All permanent employees (including Executive Directors) who were
continuously employed by the consolidated entity for a period of at least
one year were eligible to participate in the scheme. Employees could
elect not to participate in the scheme.
Under the scheme, eligible employees were offered $1,000 worth of
fully-paid ordinary shares in BSA Limited for the year ended 30 June
2004 for no cash consideration. The market value of shares issued under
the scheme, measured as the weighted average market price on the day
of issue of the shares, was recognised in the Consolidated Statement of
To achieve its corporate objectives, the Company needs to attract
and retain key staff. The Board believes that awards made to selected
eligible employees under this plan:
•
Provide an incentive for the creation of, and focus on,
shareholder wealth;
•
Enable the Company to recruit and retain the talented people
needed to achieve the Company’s business objectives;
•
Link the reward of key staff with the achievement of strategic
goals and the performance of the Company;
Financial Position as share capital and as part of employee benefit costs.
•
Align the financial interests of participants with those of
Offers under the scheme are at the discretion of the Company. No offers
were made to any Director or employee of BSA Limited during the year
ended 30 June 2017.
Executives Securities Plan
The establishment of the BSA Executive Securities Plan was approved by
shareholders at the 2005 AGM. The plan was established as a mechanism
to provide the Company’s key executives with a direct equity interest in
the Company to better align them with the shareholders.
The number of securities to be offered and the time at which securities
may be offered from time to time to executives, and the price and terms
of payment are determined by the Board in its discretion.
The Board may at such times as it determines invite any executive to be a
member of the plan.
Company shareholders; and
•
Ensure the remuneration packages of employees are consistent
with market practice.
Vesting of rights or shares under this Plan requires the achievement of
appropriate perfomance or service hurdles to be determined by the Board:
(i) Service condition of a specified period; or
(ii) The Company’s performance as measured by earnings per
share (EPS), being the EPS for the relevant Measurement Period
as determined by the Board having regard to the financial
statements. Certain growth in EPS for the shares must be
attained in respect of each Measurement Period and pro-rata in
respect of the initial Measurement Period. The Company must
achieve these performance conditions before the rights vest.
19
BSA LIMITED ANNUAL REPORT 2017 DIRECTORS’ REPORT
Once rights have been exercised by an eligible employee (subject to
made which aim to enhance the above scheme to improve the direct
relevant service or performance conditions being met), the Company
link to performance, incentivise managers and assist the Company in
may make non-refundable contributions to either fund the purchase of
retaining high performing executives and managers. Details of a new
a new plan share, or to acquire on the ASX existing shares and transfer
Employee Performance Rights Scheme to replace the existing Employee
these to an eligible employee.
The specific terms of a particular grant, including any performance
conditions, will be contained in the invitation and associated
documentation sent to the eligible employee.
A right granted to a participant is not transferable and may not
otherwise be dealt with, except with the Board’s approval, or by
operation of law on death or legal incapacity.
Rights to acquire shares are not exercisable until the end of the final
measurement period, and until those rights have satisfied all vesting
conditions and any performance hurdles established by the Board.
This is subject to a number of exceptions (including death, cessation
of employment, takeovers and schemes of arrangement). The rights
will have a specified life determined by the Board. All grants of rights
will have a life terminating five (5) years after the grant date or such
other date as determined by the Board.
On or after the end of the final measurement period and provided
any performance hurdle prescribed by the Board has been achieved
and, where applicable, to the extent it has been achieved, the plan
participant may then acquire shares by exercising the rights.
A right lapses if the vesting conditions are not met.
Performance Rights Scheme are being considered by the Board and
Remuneration Committee as outlined in section F below which will, if
the Board determines to proceed with it, be tabled at the forthcoming
Company AGM for approval by shareholders.
B
DETAILS OF REMUNERATION
Details of the remuneration of the Directors, the key management
personnel of the Group (as defined in AASB 124 Related Party
Disclosures) and specified executives of BSA and the BSA Group are set
out in the following tables.
The Key Management Personnel of the Group are the following:
(i) Chairman - Non-Executive
Michael Givoni
(ii) Executive Directors
Nicholas Yates
(iii) Non-Executive Directors
Paul Teisseire
Max Cowley
Mark Lowe
Graeme Barclay
Following a review of the Employee Performance Rights Plan by
external advisors to the Board, certain recommendations have been
(iv) Chief Financial Officer
Nicholas Benson
20
BSA LIMITED ANNUAL REPORT 2017 Non-Executive Directors, key management personnel of the Group and other executives of the Company and the Group
2017
Short-term
Benefits
Long-
term
Post Employment
Benefits
Share-based
payments
Cash,
Interest
Unwind
Long
Name
Fees
Bonus
Loans
Superannuation
Leave
Benefits
Rights
Rights
Total
Related
Salary &
Cash
on
Service
Termination
Performance
$
$
$
$
$
$
$
%
$
%
Non-Executive Directors
Michael Givoni
Paul Teisseire
Max Cowley
Mark Lowe *
Graeme Barclay
156,008
83,616
83,616
107,616
83,616
Sub-total
514,472
Non-Executive Directors
Executive Directors
-
-
-
-
-
-
-
-
-
-
-
-
14,821
7,944
7,944
10,224
7,944
48,877
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
170,829
91,560
91,560
117,840
91,560
563,349
-
-
-
-
-
Nicholas Yates
643,449
50,000
-
19,308
12,835
-
-
-
725,592
6.89
Other Key
Management Personnel
Chief Financial Officer
Nicholas Benson
386,944
50,000
Total compensation
1,544,865
100,000
-
-
25,000
8,457
-
29,355
5.87
499,756
15.88
93,185
21,292
-
29,355
1,788,697
* During FY2017 Mark Lowe was contracted to the company within the BSA | Build business unit, to assist in driving improved performance from the business
unit. $24,000 of Mark Lowe’s remuneration relates to his role assisting BSA | Build during the year.
21
BSA LIMITED ANNUAL REPORT 2017
DIRECTORS’ REPORT
2016
Short-term
Benefits
Long-
term
Post Employment
Benefits
Share-based
payments
Cash,
Interest
Unwind
Long
Name
Fees
Bonus
Loans
Superannuation
Leave
Benefits
Rights
Rights
Total
Related
Salary &
Cash
on
Service
Termination
Performance
$
$
$
$
$
$
$
%
$
%
Non-Executive Directors
Michael Givoni
Paul Teisseire
Max Cowley
Mark Lowe *
Graeme Barclay
156,008
83,616
87,230
311,230
83,616
Sub-total
721,700
Non-Executive Directors
Executive Directors
-
-
-
-
-
-
-
-
-
-
-
-
14,821
7,944
8,287
29,567
7,944
68,563
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
170,829
91,560
95,517
340,797
91,560
790,263
-
-
-
-
-
Nicholas Yates
659,422
268,000
-
20,010
8,554
-
-
-
955,986
28.03
Other Key
Management Personnel
Chief Financial Officer
Nicholas Benson
369,310
72,000
Total compensation
1,750,432
340,000
-
-
26,537
5,155
115,110
13,709
-
-
-
-
-
473,002
15.22
2,219,251
* During FY2015 Mark Lowe was contracted to the company within the BSA | Build business unit, to assist in driving improved performance from the business
unit. $224,000 of Mark Lowe’s remuneration relates to his role assisting BSA | Build during the year.
Performance Income as a Proportion of Total Remuneration:
Remuneration and other terms of employment for the Managing
Executive Directors and executives are paid performance based
bonuses based on set monetary figures, rather than proportions of
their salary. This has led to the proportions of remuneration related
to performance varying between individuals. The Remuneration
Committee has set these bonuses to encourage achievement of specific
goals that have been given a high level of importance to the future
Director and the other key management personnel are also formalised
in service agreements. Each of these agreements provide for the
provision of performance-related cash bonuses, other benefits, car
allowances, and participation, when eligible, in the BSA Limited Option
Plan and the BSA Performance Rights Plan. Other major provisions of
the agreements relating to remuneration are set out below.
growth and profitability of the consolidated Group.
All contracts with executives may be terminated early by either party
The Remuneration Committee will review the performance bonuses
with three to six months notice.
to gauge their effectiveness against achievement of the set goals, and
D.
CASH BONUSES
adjust future years’ incentives as they see fit, to ensure use of the most
cost effective and efficient methods.
C.
SERVICE AGREEMENTS
Bonuses vested as per the below table during the financial year ended
30 June 2017.
Key management personnel and executives are also entitled to a short-
On appointment to the Board, all Non-Executive Directors enter into
term cash incentive based on performance criteria described in section
a service agreement with the Company in the form of a letter of
A to this Remuneration Report. Details of these FY2017 short-term
appointment. The letter summarises the Board policies and terms,
incentives recognised as remuneration, forfeited or available for vesting
including compensation, relevant to the office of Director. A copy of the
in future financial years is outlined below.
letter can be found on BSA Limited’s website.
22
BSA LIMITED ANNUAL REPORT 2017
Name
Other key management personnel (Group)
Nicholas Yates
Nicholas Benson
E
SHARE-BASED COMPENSATION
Executives Securities Plan
Set out below are summaries of Securities held in escrow:
Included in
Remuneration
% Vested in
current year
% Forfeited
in current year
50,000
50,000
100
100
-
-
Issue Price
Balance at Start
During the
During the Year Based on
Balance in Escrow
Amount of
Granted
Released from Escrow
Grant Date
(cents)
of the Year
Year
Full Loan Repayment
at End of the Year
Number
Number
Number
Number
Loan
$
Consolidated and parent entity
13 Oct 2006
19 Jul 2007
11 Sep 2007
13 Sep 2007
14 Dec 2007
10 Feb 2009
Total
0.23
0.63
0.68
0.68
0.68
0.10
700,000
1,600,000
150,000
200,000
400,000
1,700,000
4,750,000
-
-
-
-
-
-
-
Employee Performance Rights Plan
Set out below are summaries of Rights issued to key management personnel under the plan:
-
-
-
-
-
-
-
700,000
161,000
1,600,000
1,008,000
150,000
102,000
200,000
136,000
400,000
272,000
1,700,000
170,000
4,750,000
1,849,000
Name
Grant Date
Date
Expiry Date
the Year
the Year
Year
the Year
Year
Date $
$
Vesting
at Start of
During
During the
During
End of the
at Grant
Fair Value
Number
Number
Number
Number
Balance
Granted
from Escrow
Forfeited
Escrow at
per Right
Aggregate
Released
Balance in
Fair Value
Consolidated and parent entity
Nicholas Yates*
25 Nov 2014
30 Jun 2015
25 Nov 2019
1,116,667
-
Nicholas Benson
29 Nov 2016
6 Feb 2017
29 Nov 2021
-
90,322
Total
1,116,667
90,322
-
-
-
-
-
1,116.667
0.165
184,250
90,322
0.325
29,355
1,206,989
213,605
Rights are granted over ordinary shares and nil is payable on exercise.
*In addition, the Board has approved that Nicholas Yates be awarded 142,857 performance rights with an exercise price of $0.35 per right, but
subject to a tenure of 12 months from 31 January 2017 to 31 January 2018. These are subject to the approval of shareholders at the 2017 AGM.
23
BSA LIMITED ANNUAL REPORT 2017 DIRECTORS’ REPORT
F
REMUNERATION CONSULTANTS
In December 2016, Godfrey Remuneration Group (GRG) was appointed as independent remuneration advisor to the Board and was engaged,
independent of management, to assist the Board with a review of the current structure of the Executive Rights Plan. GRG is assisting the Board to
develop and document a new Rights plan which is reflective of the current regulatory and tax environment, including the use of indeterminate rights
(which are rights to the value of a share, which may be settled in the future for of a Company share, or the equivalent value in cash). The purpose of
the use of indeterminate rights is to manage termination and tax issues that arise rather than to award long term incentives in cash i.e. it would be
expected that Rights will be settled in shares, other than in exceptional circumstances. The new plan will also allow executives to elect to extend the
deferral of their incentives beyond the default periods, if it is in their view appropriate to their circumstances, and facilitate the sacrificing of cash
remuneration into Restricted Rights (which are subject to disposal restrictions). This is intended to encourage executives to hold more equity, for
longer, improving alignment with shareholders. GRG was also engaged to develop an opportunity for non-executive directors to purchase equity in
BSA through a fee sacrifice scheme, which is also intended to improve the alignment between such directors, and shareholders.
The engagement of GRG by the Chairman of the Remuneration Committee was based on an agreed set of protocols that have been followed
by GRG, members of the Remuneration Committee and members of the key management personnel, governing the way in which remuneration
recommendations would be developed by GRG and provided non-executive members of the Remuneration Committee.
These arrangements were implemented to ensure that GRG would be able to carry out its work, including information capture and the formation of its
recommendations, free from undue influence by Executive directors or executive key management personnel about whom the recommendations may relate.
The Board undertook its own inquiries and review of the processes and procedures followed by GRG and is satisfied that their remuneration
recommendations were made free from such influence.
The Board and Remuneration Committee confirm that GRG made remuneration recommendations within the meaning of the Corporations Act
in respect of the structure of the Incentive Plans being considered. These remuneration recommendations were made in respect of elements of
remuneration and were not in respect of the quantum of the incentives to be provided.
The advice obtained from GRG is currently being considered by the Board and Remuneration Committee and if any new schemes, or amendments to
existing schemes, are considered appropriate, they will be brought to shareholders for approval.
The total consideration paid during the year by the company to GRG for the provision of the remuneration recommendations in the 2017 financial
year was $5,000 (2016: Nil).
End of Audited Remuneration Report
BSA | Build Parklands Project on the Gold Coast consisted of design and installation of Fire Detection, Fire Sprinklers, Fire Hydrants, Hose Reels, Fire
Extinguishers and Occupant warning Systems to 18 midrise towers contained within 5 super lots. The site will contain 1,252 residences and 5 804m2 of retail
space. In late 2017 Parklands Project will be transformed into the 2018 Commonwealth Games Village.
24
BSA LIMITED ANNUAL REPORT 2017 MEETINGS OF DIRECTORS
The number of meetings of BSA’s Board of Directors and each Board committee held during the year ended 30 June 2017, and the number of
meetings attended by each Director were:
Board Meetings
Audit Committee Meetings
Remuneration Committee Meetings
Meetings Held
Meetings Held during
Meetings
Attended
during tenure
Meetings
in FY2017
Attended
tenure
in FY2017
Meetings
Attended
Meetings Held
during tenure
in FY2017
Michael Givoni
Nicholas Yates
Graeme Barclay
Max Cowley
Paul Teisseire
Mark Lowe
12
12
11
11
12
12
12
12
12
12
12
12
3
*
3
2
3
2
3
*
3
3
3
3
4
*
4
3
4
4
4
*
4
4
4
4
*Not a member of the relevant committees, but attended all the Audit Committee and Remuneration Committee meetings.
RETIREMENT, ELECTION AND CONTINUATION
IN OFFICE OF DIRECTORS
RIGHTS
As at the date of this report, the unissued ordinary shares of the
Directors are subject to retirement by rotation and election by
Company, under right, are as follows:
Grant Date
Date of Expiry
Exercise Price
Number
under Right
Fair value at
grant date
25 Nov 2014
25 Nov 2019
29 Nov 2016
29 Nov 2021
$0.00
$0.00
1,116,667
290,322
1,406.989
$0.165
$0.325
During the year ended 30 June 2017, 506,000 rights and 344,080
options granted under the BSA Limited Employee Performance Rights
Plan were cancelled because vesting conditions were not met. During
the year ended 30 June 2017, 115,000 rights and 78,200 options
granted under the BSA Limited Employee Performance Rights Plan
were exercised. No further shares have been issued since that date. No
amounts are unpaid on any of the shares.
No person entitled to exercise the right had, or has, any right by virtue of
the right to participate in any share issue of any other body corporate.
shareholders at a general meeting. No Director, other than the
Managing Director, may remain on the Board for more than three years
without re-election. Where a Director is appointed during the year, the
Director will hold office until the next Annual General Meeting (AGM),
and then be eligible for election.
Michael Givoni and Mark Lowe are the Directors who have been longest
in office and who, being eligible, offer themselves for re-election at the
2017 Annual General Meeting.
INDEMNIFYING OFFICERS OR AUDITORS
During the year, the Company paid a premium for a contract insuring
all Directors, secretaries, Executive officers and officers of the
Company, and of each related body corporate of the Company. The
insurance does not provide cover for the independent auditors of the
Company, or of a related body corporate of the Company.
In accordance with usual commercial practice, the insurance contract
prohibits disclosure of details of the nature of the liabilities covered by
the insurance, the limit of indemnity and the amount of the premium
paid under the contract.
No liability has arisen under this indemnity as at the date of this report.
OPTIONS
As at the date of this report, there were no unissued ordinary shares of
the Company under option.
During the year ended 30 June 2017, no ordinary shares of the Company
were issued on the exercise of options granted under the BSA Limited
Employee Option Plan. No further shares have been issued since that
date. No amounts are unpaid on any of the shares.
25
BSA LIMITED ANNUAL REPORT 2017 DIRECTORS’ REPORT
PROCEEDINGS ON BEHALF OF THE COMPANY
AUDITORS’ REMUNERATION
No person has applied to the court under section 237 of the
Corporations Act 2001 (Cth) for leave to bring proceedings on behalf of
the Company, or to intervene in any proceedings to which the Company
is a party, for the purpose of taking responsibility on behalf of the
2017
$
2016
$
Company for all, or part, of those proceedings.
Amounts due for the financial year to Deloitte Touche Tohmatsu for:
No proceedings have been brought or intervened on behalf of
the Company with leave of the court under section 237 of the
Corporations Act 2001 (Cth).
Auditing or reviewing the financial report
366,765
337,461
Taxation services
Other non-audit services
125,963
152,426
12,329
12,333
NON AUDIT SERVICES
AUDITORS INDEPENDENCE DECLARATION
The Company may decide to employ the auditor on assignments
The lead auditors’ independence declaration for the year ended 30 June
additional to their statutory audit duties where the auditor’s expertise
2017 as required under section 307c of the Corporations Act 2001 (Cth)
and experience with the Company and/or Group are important.
has been received and can be found on page 28 of this report.
Details of the amounts paid or payable to the auditor (Deloitte
Touche Tohmatsu) for audit and non-audit services during the year
ROUNDING OF AMOUNTS
are set out below.
The company is a company of the kind referred to in ASIC Corporations
The Board of Directors has considered the position and in accordance
(Rounding in Financials/Directors’ Reports) Instrument 2016/191, dated
with the advice received from the Audit Committee, is satisfied that
24 March 2016, and in accordance with that Corporations Instrument
the provision of non-audit services by the auditor, as set out below,
amounts in the directors’ report and the financial statements are
did not compromise the auditor independence requirements of the
rounded off to the nearest thousand dollars, unless otherwise indicated.
Corporations Act 2001 (Cth) for the following reasons:
All non-audit services have been reviewed by the Audit Committee
to ensure they do not impact the impartiality and objectivity of the
auditor; and
None of the services undermine the general principles relating to
auditor independence as set out in Professional Statement APES 110
Code of Ethics for Professional Accountants, including reviewing or
auditing the auditors own work, acting in a management or a decision
making capacity for the Company, acting as advocate for the Company
or jointly sharing economic risk and rewards.
26
Signed in accordance with a resolution of the Board of Directors.
Michael Givoni
Chairman
28 August 2017
BSA LIMITED ANNUAL REPORT 2017 Bolte Tower 10, Docklands Victoria. Mechanical Services provided by
BSA | Build for 270 Apartments over 30 Levels with Central Plant.
27
BSA LIMITED ANNUAL REPORT 2017 AUDITOR’S INDEPENDENCE DECLARATION
28
BSA LIMITED ANNUAL REPORT 2017 nbn Operate and Maintain Technician
undertaking works at a pillar for BSA | Connect.
29
BSA LIMITED ANNUAL REPORT 2017 FINANCIAL REPORT
BSA LIMITED
ABN 50 088 412 748
31 —
Consolidated Statement of Profit or Loss and
Other Comprehensive Income
32 —
Consolidated Statement of Financial Position
33 —
Consolidated Statement of Changes in Equity
34 —
Consolidated Statement of Cash Flows
35 —
Notes to the Financial Statements
86 —
Directors’ Declaration
87 —
Independent Auditor’s Report
92 —
Shareholder Information
30
BSA LIMITED ANNUAL REPORT 2017 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Revenue
Investment revenue
Other gains and losses
Share of losses/profits of joint venture
Changes in inventories of finished goods and work in progress
Subcontractor and raw materials used
Employee benefits expense
Depreciation expenses
Amortisation expenses
Occupancy expenses
Finance costs
Other expenses
Profit/(loss) before tax
Income tax (expense)/benefit
Profit/(loss) for the year
Other comprehensive income for the year, net of tax
Items that may be reclassified subsequently to profit or loss:
Net gain recognised on cash flow hedges
Total comprehensive income for the year, net of tax
Earnings per share for profit from continuing operations:
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
Note
5
6
7
20
8.1
8.1
8.4
8.3
8.3
8.2
37
9.1
2017
$’000
492,317
166
387
-
(557)
(398,279)
(45,803)
(4,260)
(738)
(6,699)
(595)
(30,305)
Consolidated
2016
$’000
511,856
96
120
(277)
(1,969)
(426,675)
(46,931)
(5,029)
(1,440)
(6,816)
(741)
(25,208)
5,634
(3,014)
(1,671)
3,963
-
3,963
795
(2,219)
-
(2,219)
12
12
0.94 cents
0.93 cents
(0.52) cents
(0.52) cents
The above Consolidated Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes.
31
BSA LIMITED ANNUAL REPORT 2017 CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2017
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Inventories
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Trade and other receivables
Other financial assets
Property, plant & equipment
Deferred tax assets
Goodwill
Other intangible assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Borrowings
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Borrowings
Provisions
Investment in Joint Venture
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued Capital
Reserves
Accumulated losses
Profit Reserve
TOTAL EQUITY
Note
13
14
15
14
19
16
9.3
17
18
23
24
25
24
25
20
26
27
27
27
(a)
(b)
(c)
2017
$’000
16,432
99,043
2,174
117,649
2,248
3
9,522
6,124
15,185
2,414
35,496
153,145
88,320
1,664
14,381
104,365
1,263
1,992
81
3,336
107,701
45,444
97,564
1,423
(65,243)
11,700
45,444
Consolidated
2016
$’000
21,490
77,795
2,731
102,016
1,957
3
7,723
7,795
15,185
3,152
35,815
137,831
70,593
1,895
21,684
94,172
1,094
1,052
17
2,163
96,335
41,496
97,592
1,410
(65,243)
7,737
41,496
The above Consolidated Statement of Financial Position should be read in conjunction with the accompanying notes.
32
BSA LIMITED ANNUAL REPORT 2017
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017
Balance at 1 July 2015
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
Balance at 30 June 2016
Profit for the year
Other comprehensive income for the year
Total comprehensive income for the year
Share-based payment expense
Issued
Accumulated
Capital
$’000
97,592
-
-
-
Losses
$’000
(63,024)
(2,219)
-
(2,219)
97,592
(65,243)
-
-
-
-
-
-
-
-
-
Profit
Reserve
$’000
Share-based
Payment
Reserve
$’000
7,737
1,410
-
-
-
7,737
3,963
-
3,963
-
-
-
-
-
1,410
-
-
-
54
(41)
Consolidated
Total
$’000
43,715
(2,219)
-
(2,219)
41,496
3,963
-
3,963
54
(69)
Shares issued in satisfaction of performance conditions
(28)
Balance at 30 June 2017
97,564
(65,243)
11,700
1,423
45,444
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
33
BSA LIMITED ANNUAL REPORT 2017 CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2017
Note
Cash Flows From Operating Activities:
Cash receipts from customers
Payments to suppliers and employees
Interest received
Interest and other costs of finance paid
Net cash (used in)/generated by operating activities
30 (a)
Cash Flows from Investing Activities:
Proceeds from disposal of property, plant and equipment
Payment for plant and equipment
Net cash used in investing activities
Cash Flows From Financing Activities:
Payment for shares issued for vesting rights
Proceeds from borrowings
Repayment of borrowings
Payment of finance lease and hire purchase liabilities
Share issue costs paid
Net cash used in financing activities
Net decrease in cash
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
13
The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes.
2017
$’000
539,854
(540,202)
166
(596)
(778)
467
(4,050)
(3,583)
(41)
3,801
(3,718)
(711)
(28)
(697)
(5,058)
21,490
16,432
Consolidated
2016
$’000
557,462
(554,781)
96
(741)
2,036
188
(1,406)
(1,218)
-
3,513
(8,329)
(1,578)
-
(6,394)
(5,576)
27,066
21,490
34
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 1 GENERAL INFORMATION
BSA Limited (the Company) is a limited company incorporated in Australia. The address of its registered office and principal places of business are disclosed in
the Corporate Directory at the end of the Annual Report. The principal activities of the Company and its subsidiaries (the Group) are described in note 29.
NOTE 2 APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRSs)
2.1 Amendments to IFRSs that are mandatorily effective for the current year
In the current year, the Group has applied a number of amendments to IFRSs issued by the International Accounting Standards Board (IASB) that are
mandatorily effective for an accounting period that begins on or after 1 July 2016.
Amendments to IFRS 11 Accounting for Acquisitions of Interests in Joint Operations
The Group has applied these amendments for the first time in the current year. The amendments provide guidance on how to account for the acquisition of
a joint operation that constitutes a business as defined in IFRS 3 Business Combinations. Specifically, the amendments state that the relevant principles on
accounting for business combinations in IFRS 3 and other standards should be applied. The same requirements should be applied to the formation of a joint
operation if and only if an existing business is contributed to the joint operation by one of the parties that participate in the joint operation.
A joint operator is also required to disclose the relevant information required by IFRS 3 and other standards for business combinations.
The application of these amendments has had no impact on the Group's consolidated financial statements as the Group did not have any such transactions
in the current year.
Amendments to IAS 1 Disclosure Initiative
The Group has applied these amendments for the first time in the current year. The amendments clarify that an entity need not provide a specific disclosure
required by an IFRS if the information resulting from that disclosure is not material, and give guidance on the basis of aggregating and disaggregating
information for disclosure purposes. However, the amendments reiterate that an entity should consider providing additional disclosures when compliance
with the specific requirements in IFRS is insufficient to enable users of financial statements to understand the impact of particular transactions, events and
conditions on the entity’s financial position and financial performance.
In addition, the amendments clarify that an entity’s share of the other comprehensive income of associates and joint ventures accounted for using the equity
method should be presented separately from those arising from the Group, and should be separated into the share of items that, in accordance with other
IFRSs: (i) will not be reclassified subsequently to profit or loss; and (ii) will be reclassified subsequently to profit or loss when specific conditions are met.
As regards to the structure of the financial statements, the amendments provide examples of systematic ordering or grouping of the notes.
The application of these amendments has not resulted in any impact on the financial performance or financial position of the Group.
Amendments to IAS 16 and IAS 38 Clarification of Acceptable Methods of Depreciation and Amortisation
The Group has applied these amendments for the first time in the current year. The amendments to IAS 16 prohibit entities from using a revenue-based
depreciation method for items of property, plant and equipment. The amendments to IAS 38 introduce a rebuttable presumption that revenue is not an
appropriate basis for amortisation of an intangible asset. This presumption can only be rebutted in the following two limited circumstances:
a)
b)
when the intangible asset is expressed as a measure of revenue; or
when it can be demonstrated that revenue and consumption of the economic benefits of the intangible asset are highly correlated.
As the Group already uses the straight-line method for depreciation and amortisation for its property, plant and equipment, and intangible assets
respectively, the application of these amendments has had no impact on the Group's consolidated financial statements.
Annual Improvements to IFRSs 2012-2014 Cycle
The Group has applied the below amendment for the first time in the current year. The Annual Improvements to IFRSs 2012-2014 Cycle include a number of
amendments to various IFRSs.
The amendments to IAS 19 clarify that the rate used to discount post-employment benefit obligations should be determined by reference to market yields
at the end of the reporting period on high quality corporate bonds. The assessment of the depth of a market for high quality corporate bonds should be
at the currency level (i.e. the same currency as the benefits are to be paid). For currencies for which there is no deep market in such high quality corporate
bonds, the market yields at the end of the reporting period on government bonds denominated in that currency should be used instead.
The application of these amendments has had no effect on the Group's consolidated financial statements.
35
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 2 APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (CONTINUED)
2.2 Standards and Interpretations on issue not yet adopted
The Group has not applied the following new and revised IFRSs that have been issued but are not yet effective:
Standard/Interpretation
AASB 9 Financial Instruments
Effective for annual
Expected to be
reporting periods
initially applied in the
beginning on or after
financial year ending
1 January 2017
30 June 2018
AASB 15 Revenue from Contracts with Customers (and the related Clarifications)*
1 January 2018
30 June 2019
AASB 16 ‘Leases’ **
1 January 2019
30 June 2020
Amendments to AASB 2 Classification and Measurement of Share-based Payment Transactions
To be determined
To be determined
Amendments to AASB 10 and AASB 128 Sale or Contribution of Assets between an Investor and its
To be determined
To be determined
Associate or Joint Venture
Amendments to AASB 107 Disclosure Initiative
1 January 2017
30 June 2018
Amendments to AASB 112 Recognition of Deferred Tax Assets for Unrealised Losses
1 January 2017
30 June 2018
*AASB 15 replaces all current guidance on revenue recognition from contracts with customers. It requires identification of discrete performance obligations
within a transaction and an associated transaction price allocation to these obligations. Revenue is recognised upon satisfaction of these performance
obligations, which occur when control of the goods or services are transferred to the customer. Revenue received for a contract that includes a variable
amount is subject to revised conditions for recognition, whereby it must be highly probable that no significant reversal of the variable component may
occur when the uncertainties around its measurement are removed.
The Company will first apply AASB 15 in the financial year beginning 1 July 2018 and is expected to apply the standard retrospectively, recognising the
cumulative effect of initially applying the standard as an adjustment to the opening balance of retained earnings.
The impact of the application of this standard is still being assessed by the Company. Any transition adjustment to retained earnings is subject to the
revenue streams existing at the date of transition.
** AASB 16 replaces the current AASB 117 Leases standard and sets out a comprehensive model for identifying lease arrangements and the subsequent
measurement. A contract contains a lease if it conveys the right to control the use of an identified asset for a period of time. The majority of leases from
the lessee perspective within the scope of AASB 16 will require the recognition of a ‘right of use’ asset and a related lease liability, being the present value
of future lease payments. This will result in an increase in the recognised assets and liabilities in the statement of financial position as well as a change in
expense recognition, with interest and depreciation replacing operating lease expense.
AASB 16 is effective for the Company for the annual period beginning 1 July 2019 with the option to early adopt in the financial year beginning 1 July 2018.
The Company is expected to apply the standard retrospectively, recognising the cumulative effect of initially applying the standard as an adjustment to the
opening balance of retained earnings. Alternative methods of calculating the ‘right of use’ asset are allowed under AASB 16 which impact the size of the
transition adjustment. The Company is still evaluating which method to apply.
The application of this standard is currently being assessed by the Company. Refer to Section 3.9 for Leasing.
36
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES
3.1 Statement of compliance
The consolidated financial statements have been prepared using Australian equivalents to International Financial Reporting Standards compliant with IFRS.
The financial statements were authorised for issue by the Directors on 28 August 2017.
3.2 Basis of preparation
The consolidated financial statements have been prepared on the basis of historical cost, except for certain financial instruments that are measured at
revalued amounts or fair values at the end of each reporting period, as explained in the accounting policies below.
Historical cost is generally based on the fair values of the consideration given in exchange for goods and services. All amounts are presented in Australian
dollars, unless otherwise noted.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an
asset or a liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account
when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is
determined on such a basis, except for share-based payment transactions that are within the scope of AASB 2, leasing transactions that are within the scope of
AASB 117, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in AASB 102 or value in use in AASB 136.
In addition, for financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair
value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:
• Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;
• Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
• Level 3 inputs are unobservable inputs for the asset or liability.
The principal accounting policies are set out below.
3.3 Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company and its subsidiaries.
Control is achieved when the Company:
• has power over the investee;
•
is exposed, or has rights, to variable returns from its involvement with the investee; and
• has the ability to use its power to affect its returns.
The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three
elements of control listed above.
When the Company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give
it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances in assessing
whether or not the Company’s voting rights in an investee are sufficient to give it power, including:
•
the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;
• potential voting rights held by the Company, other vote holders or other parties;
•
rights arising from other contractual arrangements; and
• any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant activities at the
time that decisions need to be made, including voting patterns at previous shareholders’ meetings.
Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary.
Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss and
other comprehensive income from the date the Company gains control until the date when the Company ceases to control the subsidiary.
Profit or loss and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total
comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-
controlling interests having a deficit balance.
37
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the Group’s
accounting policies.
All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the Group are eliminated in full on
consolidation.
The parent entity carries its investment in subsidiaries at cost less impairment (if any).
3.4 Business combinations
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value
which is calculated as the sum of the acquisition-date fair values of assets transferred by the Group, liabilities incurred by the Group to the former owners
of the acquiree and the equity instruments issued by the Group in exchange for control of the acquiree. Acquisition-related costs are recognised in profit or
loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value at the acquisition date, except that:
• Deferred tax assets or liabilities and liabilities or assets related to employee benefit arrangements, are recognised and measured in accordance with
AASB 112 Income Taxes and AASB 19 respectively;
• Liabilities or equity instruments related to share-based payment arrangements of the acquiree, or share-based payment arrangements of the Group
entered into to replace share-based payment arrangements of the acquiree, are measured in accordance with AASB 2 ‘Share-based Payment’ at the
acquisition date (see note 3.12); and
• Assets (or disposal groups) that are classified as held for sale in accordance with AASB 5 Noncurrent Assets Held for Sale and Discontinued Operations
are measured in accordance with that Standard.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair
value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired
and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds
the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held
interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.
Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity’s net assets in the event of
liquidation may be initially measured either at fair value or at the non-controlling interests’ proportionate share of the recognised amounts of the acquiree’ s
identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are measured at
fair value or, when applicable, on the basis specified in another A-IFRS.
Where the consideration transferred by the Group in a business combination includes assets or liabilities resulting from a contingent consideration
arrangement, the contingent consideration is measured at its acquisition-date fair value. Changes in the fair value of the contingent consideration
that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period
adjustments are adjustments that arise from additional information obtained during the ‘measurement period’ (which cannot exceed one year from the
acquisition date) about facts and circumstances that existed at the acquisition date.
The subsequent accounting for changes in the fair value of contingent consideration that do not qualify as measurement period adjustments depends on
how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and
its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or liability is remeasured at subsequent
reporting dates in accordance with AASB 139, or AASB 137 ‘Provisions, Contingent Liabilities and Contingent Assets’, as appropriate, with the corresponding
gain or loss being recognised in profit or loss.
Where a business combination is achieved in stages, the Group’s previously held interests in the acquired entity are remeasured to fair value at the
acquisition date (i.e. the date the Group attains control) and the resulting gain or loss, if any, is recognised in profit or loss. Amounts arising from interests in
the acquiree prior to the acquisition date that have previously been recognised in other comprehensive income are reclassified to profit or loss, where such
treatment would be appropriate if that interest were disposed of.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports
provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see
above), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed as of the acquisition
date that, if known, would have affected the amounts recognised as of that date.
38
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.5 Goodwill
Goodwill arising on an acquisition of a business is carried at cost as established at the date of the acquisition of the business (see 3.4 above) less
accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating units) that is
expected to benefit from the synergies of the combination.
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is indication that the unit
may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce
the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in
the unit. Any impairment loss for goodwill is recognised directly in profit or loss in the Consolidated Statement of Profit or Loss and Other Comprehensive
Income. An impairment loss recognised for goodwill is not reversed in subsequent periods.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
3.6 Interests in Associates and Joint Ventures
An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy
decisions of the investee but is not control or joint control over those policies.
A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement.
Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require
unanimous consent of the parties sharing control.
The results and assets and liabilities of associates or joint ventures are incorporated in these consolidated financial statements using the equity method
of accounting, except when the investment, or a portion thereof, is classified as held for sale, in which case it is accounted for in accordance with IFRS
5. Under the equity method, an investment in an associate or a joint venture is initially recognised in the consolidated statement of financial position at
cost and adjusted thereafter to recognise the Group's share of the profit or loss and other comprehensive income of the associate or joint venture. When
the Group's share of losses of an associate or a joint venture exceeds the Group's interest in that associate or joint venture (which includes any long-term
interests that, in substance, form part of the Group's net investment in the associate or joint venture), the Group discontinues recognising its share of further
losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the
associate or joint venture.
An investment in an associate or a joint venture is accounted for using the equity method from the date on which the investee becomes an associate
or a joint venture. On acquisition of the investment in an associate or a joint venture, any excess of the cost of the investment over the Group's share of
the net fair value of the identifiable assets and liabilities of the investee is recognised as goodwill, which is included within the carrying amount of the
investment. Any excess of the Group's share of the net fair value of the identifiable assets and liabilities over the cost of the investment, after reassessment,
is recognised immediately in profit or loss in the period in which the investment is acquired.
The requirements of AASB 139 are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group’s investment in
an associate or a joint venture. When necessary, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance
with AASB 136 Impairment of Assets as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs of disposal)
with its carrying amount. Any impairment loss recognised forms part of the carrying amount of the investment. Any reversal of that impairment loss is
recognised in accordance with AASB 136 to the extent that the recoverable amount of the investment subsequently increases.
The Group discontinues the use of the equity method from the date when the investment ceases to be an associate or a joint venture, or when the
investment is classified as held for sale. When the Group retains an interest in the former associate or joint venture and the retained interest is a financial
asset, the Group measures the retained interest at fair value at that date and the fair value is regarded as its fair value on initial recognition in accordance
with IAS 39. The difference between the carrying amount of the associate or joint venture at the date the equity method was discontinued, and the fair
value of any retained interest and any proceeds from disposing of a part interest in the associate or joint venture is included in the determination of the gain
or loss on disposal of the associate or joint venture. In addition, the Group accounts for all amounts previously recognised in other comprehensive income
in relation to that associate or joint venture on the same basis as would be required if that associate or joint venture had directly disposed of the related
assets or liabilities. Therefore, if a gain or loss previously recognised in other comprehensive income by that associate or joint venture would be reclassified
to profit or loss on the disposal of the related assets or liabilities, the Group reclassifies the gain or loss from equity to profit or loss (as a reclassification
adjustment) when the equity method is discontinued.
39
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
The Group continues to use the equity method when an investment in an associate becomes an investment in a joint venture or an investment in a joint
venture becomes an investment in an associate. There is no remeasurement to fair value upon such changes in ownership interests.
When the Group reduces its ownership interest in an associate or a joint venture but the Group continues to use the equity method, the Group reclassifies to
profit or loss the proportion of the gain or loss that had previously been recognised in other comprehensive income relating to that reduction in ownership
interest if that gain or loss would be reclassified to profit or loss on the disposal of the related assets or liabilities.
When a group entity transacts with an associate or a joint venture of the Group, profits and losses resulting from the transactions with the associate or joint venture
are recognised in the Group's consolidated financial statements only to the extent of interests in the associate or joint venture that are not related to the Group.
3.7 Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates and other
similar allowances.
3.7.1 Sale of goods
Revenue from the sale of goods is recognised when the goods are delivered and title has passed, at which time all the following conditions are satisfied:
• The Group has transferred to the buyer the significant risks and rewards of ownership of the goods;
• The Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold;
• The amount of revenue can be measured reliably;
•
It is probable that the economic benefits associated with the transaction will flow to the Group; and
• The costs incurred or to be incurred in respect of the transaction can be measured reliably.
3.7.2 Rendering of services
Revenue from a contract to provide services is recognised by reference to the stage of completion of the contract. The stage of completion of the contract
is determined as follows:
•
Installation fees are recognised by reference to the stage of completion of the installation, determined as the proportion of the total time expected to
install that has elapsed at the end of the reporting period;
• Servicing fees included in the price of products sold are recognised by reference to the proportion of the total cost of providing the servicing for the
product sold; and
• Revenue from time and material contracts is recognised at the contractual rates as labour hours are delivered and direct expenses are incurred.
The Group’s policy for recognition of revenue from construction contracts is described at 3.8 below.
3.7.3 Dividend and interest income
Dividend income from investments is recognised when the shareholder’s right to receive payment has been established (provided that it is probable that
the economic benefits will flow to the Group and the amount of revenue can be measured reliably).
Interest income is recognised when it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably.
Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that
exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.
40
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.8 Construction contracts and work in progress
Construction contract revenue is recognised by reference to the stage of completion of the contract activity at the end of the reporting period, measured
based on the proportion of contract revenue for work performed to date relative to the estimated total contract value. Variations in contract work, claims
and incentive payments are included to the extent that the amount can be measured reliably and its receipt is considered probable.
When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.
When contract costs incurred to date plus recognised profits less recognised losses exceed progress billings, the surplus is shown as amounts due from
customers for contract work. For contracts where progress billings exceed contract costs incurred to date plus recognised profits less recognised losses,
the surplus is shown as the amounts due to customers for contract work. Amounts received before the related work is performed are included in the
consolidated statement of financial position, as a liability, as advances received. Amounts billed for work performed but not yet paid by the customer are
included in the consolidated statement of financial position under trade and other receivables.
3.9 Leasing
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are
classified as operating leases.
3.9.1 The Group as lessee
Assets held under finance leases are initially recognised as assets of the Group at their fair value at the inception of the lease or, if lower, at the present value of the
minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation.
Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining
balance of the liability. Finance expenses are recognised immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are
capitalised in accordance with the Group’s general policy on borrowing costs (see 3.10 below). Contingent rentals are recognised as expenses in the periods in which
they are incurred.
Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of
the time pattern in which economic benefits from the leased asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in
the period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is
recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which
economic benefits from the leased asset are consumed.
3.10 Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial
period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their
intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the
borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
3.11 Employee benefits
A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave and long service leave when it is probable that
settlement will be required and they are capable of being measured reliably.
Liabilities recognised in respect of short-term employee benefits, are measured at their nominal values using the remuneration rate expected to apply at the
time of settlement.
Liabilities recognised in respect of long-term employee benefits are measured as the present value of the estimated future cash outflows to be made by the
Group in respect of services provided by employees up to reporting date.
41
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.12 Share-based payments
Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments at the
grant date. Details regarding the determination of the fair value of equity-settled share-based transactions are set out in note 31.
The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based
on the Group’s estimate of equity instruments that will eventually vest. At the end of each reporting period, the Group revises its estimate of the number
of equity instruments expected to vest with a corresponding increase in equity. At the end of each reporting period, the Group revises its estimate of the
number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the
cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee benefits reserve.
Equity-settled share-based payment transactions with parties other than employees are measured at the fair value of the goods or services received, except
where that fair value cannot be estimated reliably, in which case they are measured at the fair value of the equity instruments granted, measured at the date
the entity obtains the goods or the counterparty renders the service.
3.13 Taxation
Income tax expense represents the sum of the tax currently payable and deferred tax.
3.13.1 Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit as reported in the Consolidated Statement of Profit or Loss and
Other Comprehensive Income because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible.
The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period.
3.13.2 Deferred tax
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the
corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences.
Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available
against which those deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference
arises from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit
nor the accounting profit. In addition, deferred tax liabilities are not recognized if the temporary difference arises from the initial recognition of goodwill.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint
ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not
reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only
recognised to the extent that it is probable that there will be sufficient taxable profits against which to utilise the benefits of the temporary differences and
they are expected to reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that
sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised,
based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period. The measurement of deferred tax
liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to
recover or settle the carrying amount of its assets and liabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they
relate to income taxes levied by the same taxation authority and the Group intends to settle its current tax assets and liabilities on a net basis.
3.13.3 Current and deferred tax for the year
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity,
in which case the current and deferred tax are also recognized in other comprehensive income or directly in equity. Where current tax or deferred tax arises from
the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.
42
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.13.4 Tax consolidation
The Company and its wholly-owned Australian resident entities have formed a tax-consolidated group with effect from 1 August 2007 and are therefore
taxed as a single entity from that date. The head entity within the tax-consolidated group is BSA Limited. The members of the tax-consolidated group
are identified in note 19. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the
tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group using the ‘separate taxpayer
within group’ approach by reference to the carrying amounts in the separate financial statements of each entity and the tax values applying under tax
consolidation. Current tax liabilities and assets and deferred tax assets arising from un-used tax losses and relevant tax credits of the members of the tax-
consolidated group are recognised by the Company (as head entity in the tax-consolidated group).
Due to the existence of a tax funding arrangement between the entities in the tax-consolidated group, amounts are recognised as payable to or received by
the Company and each member of the Group in relation to the tax contribution amounts paid or payable between the parent entity and the other members
of the tax-consolidated group in accordance with the arrangement.
3.14 Property, plant and equipment
Land and buildings held for use in the production or supply of goods or services, or for administrative purposes, are stated in the Consolidated Statement of
Financial Position at cost.
Depreciation on buildings is recognised in profit or loss.
Freehold land is not depreciated.
Fixtures and equipment are stated at cost less accumulated depreciation and accumulated impairment losses.
Depreciation is recognised so as to write off the cost (other than freehold land) less their residual values over their useful lives, using the straight-line
method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any
changes in estimate accounted for on a prospective basis.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets. However, when there is no reasonable
certainty that ownership will be obtained by the end of the lease term, assets are depreciated over the shorter of the lease term and their useful lives.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use
of the asset. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the
sales proceeds and the carrying amount of the asset and is recognised in profit or loss.
3.15 Intangible assets
3.15.1 Intangible assets acquired separately
Intangible assets with finite lives that are acquired separately are carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation
is recognised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each reporting
period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired
separately are carried at cost less accumulated impairment losses.
3.15.2 Intangible assets acquired in a business combination
Intangible assets acquired in a business combination and recognised separately from goodwill are initially recognised at their fair value at the acquisition
date (which is regarded as their cost).
Subsequent to initial recognition, intangible assets acquired in a business combination are reported at cost less accumulated amortisation and accumulated
impairment losses, on the same basis as intangible assets that are acquired separately.
The following intangible assets were recognised separately from goodwill acquired during business combinations:
-
-
Customer relationships acquired during a business combination which were assessed to have a useful life of 9 years
Backlog of orders acquired during business combinations which were assessed to have useful lives of 1 to 9.5 years.
43
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.16 Impairment of tangible and intangible assets excluding goodwill
At the end of each reporting period, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any
indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). 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. Where a reasonable and consistent basis of allocation can be identified,
corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for
which a reasonable and consistent allocation basis can be identified.
Intangible assets with indefinite useful lives and intangible assets not yet available for use are tested for impairment at least annually, and whenever there is
an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for
which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-
generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a
revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of
its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit
or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase. An
impairment loss recognised for goodwill is not reversed in subsequent periods.
3.17 Inventories
Inventories are stated at the lower of cost and net realisable value. Costs, including an appropriate portion of fixed and variable overhead expenses, are
assigned to inventories by the method most appropriate to the particular class of inventory, with the majority being valued on the basis of weighted average
cost. Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale.
3.18 Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be
required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period,
taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present value of those cash flows (where the effect of the time value of money is material).
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an
asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably.
3.18.1 Warranties
Provisions for the expected cost of warranty obligations under construction contracts are recognised at the Directors’ best estimate of the expenditure required to
settle the Group’s obligation.
3.18.2 Make Good
Provisions for the estimated cost of work to comply with make good provisions in certain Group property leases are recognised at the Directors’ best estimate of
the expenditure to settle the Group’s obligation.
44
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.19 Financial Assets
Financial assets are classified into the specified category of ‘loans and receivables’. The classification depends on the nature and purpose of the financial
assets and is determined at the time of initial recognition.
3.19.1 Effective Interest Method
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The
effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees on points paid or received that form an integral part of
the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or (where appropriate) a shorter
period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest basis for debt instruments.
3.19.2 Loans and receivables
Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and
receivables’. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment. Interest income is recognised by
applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
3.19.3 Impairment of financial assets
Financial assets, other than those at Fair Value Through Profit or Loss, are assessed for indicators of impairment at the end of each reporting period.
Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial
recognition of the financial asset, the estimated future cash flows of the investment have been affected.
For certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are, in addition, assessed for
impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the Group’s past experience of collecting
payments, an increase in the number of delayed payments in the portfolio past the average credit period of 30 days, as well as observable changes in
national or local economic conditions that correlate with default on receivables.
For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between the asset’s carrying amount and the
present value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where
the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the
allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of
the allowance account are recognised in profit or loss.
3.20 Financial liabilities and equity instruments issued by the Group
3.20.1 Classification as debt or equity
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.
3.20.2 Equity instruments
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities. Equity instruments issued
by the Group are recognised at the proceeds received, net of direct issue costs.
3.20.3 Financial Liabilities
Financial liabilities are classified as ‘other financial liabilities’.
45
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 3 SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
3.20.4 Other Financial Liabilities
Other financial liabilities, including borrowings and trade and other payables, are initially measured at fair value, net of transaction costs.
Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective
yield basis.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period.
The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or (where
appropriate) a shorter period, to the net carrying on initial recognition.
3.21 Derivative financial instruments
From time to time the Group enters into a variety of derivative financial instruments to manage its exposure to interest rate risk, including interest rate
swaps. Further details of derivative financial instruments are disclosed in note 35.
Derivatives are initially recognised at fair value at the date the derivative contract is entered into and are subsequently remeasured to their fair value at
the end of each reporting period. The resulting gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a
hedging instrument, in which event the timing of the recognition in profit or loss depends on the nature of the hedge relationship.
3.21.1 Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other
comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss, and is included in the ‘other gains
and losses’ line item.
Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to profit or loss in the periods when the
hedged item is recognised in profit or loss, in the same line of the Consolidated Statement of Profit or Loss and Other Comprehensive Income as the
recognised hedged item. However, when the forecast transaction that is hedged results in the recognition of a non-financial asset or a non-financial
liability, the gains and losses previously accumulated in equity are transferred from equity and included in the initial measurement of the cost of the
non-financial asset or non-financial liability.
Hedge accounting is discontinued when the Group revokes the hedging relationship, when the hedging instrument expires or is sold, terminated, or
exercised, or when it no longer qualifies for hedge accounting. Any gain or loss accumulated in equity at that time remains in equity and is recognised
when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the gain or loss
accumulated in equity is recognised immediately in profit or loss.
3.22 Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:
i. Where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the cost of acquisition of an asset or as
part of an item of expense; or
ii. For receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables.
Cash flows are included in the cash flow statement on a gross basis. The GST component of cash flows arising from investing and financing activities which
is recoverable from, or payable to, the taxation authority is classified within operating cash flows.
46
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 4 CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
In the application of the Group’s accounting policies, which are described in note 3, the Directors are required to make judgements, estimates and assumptions
about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on
historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate
is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
4.1 Key sources of estimation uncertainty
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have
a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
4.1.1 Contracts - estimates to complete
Construction contracts are accounted for as per 3.8. Inherent in the assessment of profitability of each contract is the estimate to complete. This estimate
requires the Directors to assess the conduct of the contract to date and the expected cost to complete the contract. In addition, where appropriate,
Management and the Directors assess the probability of recovery of variations within the contract estimates.
Variations in contract work and claims are included to the extent that the amount can be measured reliably and its receipt is considered probable. Claims
and variations can be both approved and not approved by the customer. Where the claim and/or variation are not approved by the customer, estimates are
made in relation to the claim and/or variation position and management assesses the recovery at each reporting period.
4.1.2 Recoverability of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The
value in use calculation requires the directors to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate
in order to calculate present value. Where the actual future cash flows are less than expected, a material impairment loss may arise.
The carrying amount of goodwill at 30 June 2017 was $15,185,000 (30 June 2016: $15,185,000).
See note 17 for details.
4.1.3 Payroll Tax Liability
BSA has previously advised the market about a possible payroll-tax liability with the NSW Office of State Revenue (OSR). BSA has increased the provision
in its FY2017 accounts to $5,236,000 (FY2016 $2,736,000) as recognition of settlement up to 30 June 2016 as agreed with NSW OSR. The Directors' estimate
of any remaining payroll tax liability for FY2017 has been provided for in the financial statements.
See Note 25 for details.
47
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 5 REVENUE
The following is an analysis of the Group's revenue
(excluding investment revenue - see note 6).
Revenue from sale of goods
Revenue from the rendering of services
Contract revenue
Total Revenue
NOTE 6 INVESTMENT REVENUE
Interest revenue
Bank deposits
The following is an analysis of investment revenue earned on financial assets by
category of asset:
Loans and receivables (including cash and bank balances)
NOTE 7 OTHER GAINS AND LOSSES
Gain on disposal of property, plant and equipment
48
2017
$’000
Consolidated
2016
$’000
6,778
170,484
315,055
21,969
183,715
306,172
492,317
511,856
2017
$’000
166
166
166
166
2017
$’000
387
387
Consolidated
2016
$’000
96
96
96
96
Consolidated
2016
$’000
120
120
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 8 PROFIT/(LOSS) FOR THE YEAR FROM CONTINUING OPERATIONS
Profit/(Loss) for the year from continuing operations has been arrived at after charging/(crediting):
8.1
Cost of sales
8.2
Finance costs
Interest on bank overdrafts and loans
Total finance costs
8.3
Depreciation and amortisation expense
Depreciation of property, plant and equipment
Amortisation of intangible assets
2017
$’000
Consolidated
2016
$’000
398,836
428,644
595
595
4,260
738
741
741
5,029
1,440
Total depreciation and amortisation expense
4,998
6,469
8.4
Employee benefits expense
Post employment benefits
Superannuation
Share-based payments (see note 31(d))
Equity-settled share-based payments
Termination benefits
Other employee benefits
9,814
10,107
54
-
1,234
34,701
1,877
34,947
Total employee benefits expense
45,803
46,931
8.5
Significant Items
Restructure costs
nRAH completion and commissioning costs and settlement impact
Other contract one-off items
Legal and professional fees relating to legacy issues
Additional provision for NSW OSR issue
Other significant items
1,234
1,891
-
1,126
2,500
-
3,267
7,514
385
3,493
736
(861)
Total significant items
6,751
14,534
$6,751,000 (2016: $14,534,000) is included in the following categories in the Consolidated Statement of Profit or Loss and Other Comprehensive
Income, 'Subcontractors and raw materials' ($4,391,000) (2016: $12,847,000), 'Employee benefits expense' ($1,234,000) (2016: $1,197,000), 'Other
expenses' ($1,126,000) (2016: $398,000), 'Finance costs' (Nil) (2016: $11,000) and 'Depreciation expense' (Nil) (2016: $81,000).
49
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 9 INCOME TAXES
9.1
Income tax recognised in profit or loss
Current tax
In respect of the current year (benefit)
Deferred tax
In respect of the current year
2017
$’000
Note
Consolidated
2016
$’000
(70)
(70)
1,741
1,741
-
-
(795)
(795)
(795)
Total income tax expense/(benefit) recognised in the current year relating to continuing operations
1,671
The expense for the year can be reconciled to the accounting profit/(loss) as follows:
Profit/(Loss) from continuing operations
5,634
(3,014)
Income tax expense/(benefit) calculated at 30%
Adjusted for:
Non-deductible expenses
Adjustments recognised in the current year in relation to the current tax of prior years
Other
1,690
18
1,708
(37)
(37)
Total income tax expense/(benefit) recognised in the current year relating to continuing operations
1,671
(904)
138
(766)
(29)
(29)
(795)
The tax rate used for the 2017 and 2016 reconciliations above is the corporate tax rate of 30% payable by Australian corporate entities on taxable
profits under Australian tax law.
9.2
Current tax assets and liabilities
Current tax assets
Tax refund receivable
50
-
-
-
-
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 9 INCOME TAXES (CONTINUED)
9.3
Deferred tax balances
2017
Temporary differences
Finance leases
Intangible assets
Employee benefits
Provisions
Doubtful debts
Tax loss carried forward
2016
Temporary differences
Finance leases
Intangible assets
Employee benefits
Provisions
Doubtful debts
Tax loss carried forward
Deferred tax balances are presented in the Statement of Financial Position as follows:
Deferred tax assets
Deferred tax liabilities
Opening balance
Recognised in
profit or loss
Closing balance
(93)
(945)
3,269
4,094
542
928
7,795
105
221
136
(2,204)
1
70
(1,671)
12
(724)
3,405
1,890
543
998
6,124
Opening balance
Recognised in
profit or loss
Closing balance
(146)
(1,378)
3,525
2,800
758
1,441
7,000
53
433
(256)
1,294
(216)
(513)
795
(93)
(945)
3,269
4,094
542
928
7,795
30/06/2017
30/06/2016
$’000
$’000
6,124
-
6,124
7,795
-
7,795
51
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 9 INCOME TAXES (CONTINUED)
9.4
Tax consolidation
Relevance of tax consolidation to the Group
The Company and its wholly-owned Australian resident entities have formed a tax-consolidated group with effect from 1 August 2007 and are
therefore taxed as a single entity from that date. The head entity within the tax-consolidated group is BSA Limited. The members of the tax-
consolidated group are identified in note 19. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences
of the members of the tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group
using the 'separate taxpayer within group' approach by reference to the carrying amounts in the separate financial statements of each entity
and the tax values applying under tax consolidation. Current tax liabilities and assets and deferred tax assets arising from un-used tax losses and
relevant tax credits of the members of the tax-consolidated group are recognised by the Company (as head entity in the tax-consolidated group).
Due to the existence of a tax funding arrangement between the entities in the tax-consolidated group, amounts are recognised as payable to or
received by the Company and each member of the Group in relation to the tax contribution amounts paid or payable between the parent entity
and the other members of the tax-consolidated group in accordance with the arrangement.
NOTE 10 KEY MANAGEMENT PERSONNEL
The aggregate compensation made to Directors and other Key Management Personnel of the Company and the Group is set out below:
Compensation
Short-term employee benefits
Post-employment benefits
Other long-term benefits
Share-based payments
2017
$
Consolidated
2016
$
1,644,865
2,090,432
93,185
21,292
29,355
115,110
13,709
-
1,788,697
2,219,251
Further information regarding the identity of key management personnel and their compensation can be found in the Audited Remuneration
Report contained in the Directors' Report on pages 17 to 24 of this Annual Report.
52
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 11 AUDITORS’ REMUNERATION
Remuneration of the auditor of the Group for:
- Auditing or reviewing the Financial Report
- Taxation services
- Other non-audit services
The auditor of BSA Limited is Deloitte Touche Tohmatsu.
NOTE 12 EARNINGS PER SHARE
Basic profit/(loss) per share
Diluted profit/(loss) per share
(a)
Reconciliation of Earnings to Profit
Profit/(Loss)
Profit/(Loss) used to calculate basic EPS and dilutive EPS
2017
$
Consolidated
2016
$
366,765
125,963
12,329
337,461
152,426
12,333
505,057
502,220
2017
Cents
0.94
0.93
Consolidated
2016
Cents
(0.52)
(0.52)
$’000
$’000
3,963
3,963
(2,219)
(2,219)
Number
Number
(b)
Weighted average number of ordinary shares outstanding during the year used
422,907,346
422,907,346
in calculating basic EPS
Weighted average number of options/rights outstanding
1,654,946
-
Weighted average number of ordinary shares outstanding during the year used in calculating diluted EPS
424,562,292
422,907,346
(c)
Information concerning the classification of securities
Options/Rights
Options granted to employees under the BSA Limited Employee Option Plan and rights granted to employees under the BSA Limited Employees
Performance Rights Plan are considered to be potential ordinary shares and have been included in the determination of diluted earnings per share
to the extent to which they are dilutive. The options/rights have not been included in the determination of basic earnings per share. Details relating
to the options and rights are set out in note 31.
53
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 13 CASH AND CASH EQUIVALENTS
For the purposes of the Consolidated Statement of Cash Flows, cash and cash equivalents include cash on hand and in banks.
Cash at bank and on hand
NOTE 14 TRADE AND OTHER RECEIVABLES
CURRENT
Trade receivables
Allowance for doubtful debts
Other receivables
Executive Share Plan receivables
Amounts due from customers under construction contracts
Allowance for doubtful debts (construction contracts)
Accrued Revenue
Prepayments
NON-CURRENT
Executive Share Plan receivables
Other Receivables
Trade receivables
2017
$’000
16,432
16,432
2017
$’000
8,186
(160)
8,026
21,424
329
54,874
(978)
14,075
1,293
91,017
Consolidated
2016
$’000
21,490
21,490
Consolidated
2016
$’000
5,388
(206)
5,182
1,408
1,328
56,115
(947)
13,332
1,377
72,613
99,043
77,795
1,332
916
2,248
313
1,644
1,957
Note
33 (c)
21
33(c)
Trade receivables disclosed above are classified as loans and receivables and are therefore measured at amortised cost.
The average credit period for the Group is 47 days. No interest is charged on overdue receivables. Allowances for doubtful debts are recognised
against trade receivables greater than 60 days based on estimated irrecoverable amounts determined by reference to past default experience of
the counterparty.
Before accepting a new customer, the Group uses an external credit scoring system to assess the potential customer’s credit quality and defines
credit limits by customer.
54
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 14 TRADE AND OTHER RECEIVABLES (CONTINUED)
Age analysis of trade receivables that are past due but not impaired at the reporting date
Not past due
Past due [30] days
Past due [30-60] days
Past due [60-90] days
Past due [>90] days
Total
Total
$’000
7,111
693
202
80
100
8,186
Amounts due from customers under construction contracts
2017
Amount
Amount Not
Impaired
Impaired
$’000
$’000
-
-
-
65
95
160
7,111
693
202
15
5
Total
$’000
4,206
633
223
155
164
8,026
5,381
Not past due
Past due [30] days
Past due [30-60] days
Past due [60-90] days
Past due [>90] days
Total
2017
Amount
Amount Not
Impaired
Impaired
$’000
-
-
-
-
978
978
$’000
32,043
14,352
1,607
1,374
4,520
53,896
Total
$’000
32,043
14,352
1,607
1,374
5,498
54,874
Total
$’000
40,889
6,518
2,515
1,661
4,532
56,115
Consolidated
2016
Amount
Amount Not
Impaired
Impaired
$’000
4,206
633
223
10
103
5,175
Consolidated
$’000
-
-
-
145
61
206
2016
Amount
Amount Not
Impaired
Impaired
$’000
-
-
-
-
947
947
$’000
40,889
6,518
2,515
1,661
3,585
55,168
As at 30 June 2017, the Group had current trade receivables of $1,138,000 (2016: $1,153,000) that were impaired. The amounts relate to
customers who had not responded to final request for payment notices, customers that BSA had requested external collection agencies to
collect outstanding debts or customers who have disputed invoiced amounts.
Analysis of Allowance Account
Opening Balance
Provisions for doubtful receivables current
Receivables written off during the year
Closing balance
NOTE 15 INVENTORIES
CURRENT
Inventories of finished goods and work in progress at net realisable value
Consolidated
2016
$’000
1,268
474
(589)
1,153
Consolidated
2016
$’000
2,731
2,731
2017
$’000
1,153
405
(420)
1,138
2017
$’000
2,174
2,174
The cost of inventories recognised as an expense includes $457,000 (2016:$395,000) in respect of write-down of inventory to net realisable value.
55
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 16 PROPERTY, PLANT AND EQUIPMENT
Plant &
Equipment
Under Finance
Leasehold
Plant &
Lease & Hire
Make
Assets
Under
Land
Buildings
Improvements
Equipment
Purchase
Good
Construction
Total
$’000
$’000
$’000
$’000
$’000
$'000
$’000
Cost
Balance as at 1 July 2015
253
410
3,223
30,357
11,104
Additions
Disposals
Transfers *
-
-
-
-
-
-
7
-
-
1,401
(479)
94
659
(361)
(94)
251
12
-
-
Balance as at 30 June 2016
253
410
3,230
31,373
11,308
263
-
-
-
-
-
45,598
2,079
(840)
-
46,837
Additions
Disposals
Transfers *
-
-
-
-
-
-
64
(4)
1
3,313
(1,720)
15
1,101
(851)
(16)
987
673
6,138
-
-
-
-
(2,575)
-
Balance as at 30 June 2017
253
410
3,291
32,981
11,542
1,250
673
50,400
Accumulated depreciation and impairment
Balance as at 1 July 2015
Additions
Disposals
Transfers
Balance as at 30 June 2016
Additions
Disposals
Transfers *
Balance as at 30 June 2017
-
-
-
-
-
-
-
-
-
Net Book Value as at 30 June 2017
Net Book Value as at 30 June 2016
253
253
* Transfers between categories
55
17
-
-
72
16
-
-
88
322
338
2,276
477
-
-
24,727
3,111
(442)
82
7,570
1,390
(330)
(82)
229
34
-
-
2,753
27,478
8,548
263
460
(4)
-
2,363
(1,669)
(83)
3,209
28,089
82
477
4,892
3,895
1,255
(823)
83
9,063
2,479
2,760
166
-
-
429
821
-
-
-
-
-
-
-
-
-
-
34,857
5,029
(772)
-
39,114
4,260
(2,496)
-
40,878
673
9,522
-
7,723
16.1
The following useful lives are used in the calculation of depreciation:
Buildings
Leasehold improvements
Plant and equipment
25 years
4 - 5 years
3 - 10 years
Plant and equipment under finance
3 - 5 years
lease
16.2
Assets held as security
Fixed and floating charges over the whole of the parent entity and its subsidiaries' assets have been pledged as security for bank loans (see note 24).
56
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 17 NON-CURRENT ASSETS - GOODWILL
$'000
Cost
Balance at the beginning of year
2017
2016
BSA | Connect
BSA | Build
BSA | Maintain
Consolidated
-
-
15,185
15,185
-
-
15,185
15,185
The recoverable amount of each cash generating unit is determined based on value-in-use calculations. Value-in-use is calculated based on the
present value of cash flow projections over a three year period with the period extending beyond three years extrapolated using an estimate growth
rate of 3.0% for BSA | Build. The cash flows are discounted using the weighted average cost of capital with mid-year discounting.
At 30 June 2017 the company has assessed both internal and external indicators of impairment, including completing the value-in-use models, and
did not identify any indicators of impairment.
The key assumptions used in the value-in-use calculations as at 30 June 2017 and 30 June 2016 were as follows:
- growth rate used to extrapolate cash flows beyond the forecast period: 3.0% for BSA | Build (2016: 3.0%);
- pre-tax discount rate: 12.5% (2016: 12.5%); and
- divisional Revenue, EBIT, working capital adjustments and maintenance capital expenditure
NOTE 18 NON-CURRENT ASSETS - OTHER INTANGIBLE ASSETS
Intangible assets, other than goodwill, have finite lives. The current amortisation for intangible assets is included under depreciation and
amortisation expense per the Consolidated Statement of Profit or Loss and Other Comprehensive Income.
Customer Relationships
Order Backlog
$’000
$’000
Cost
Balance as at 1 July 2015
Acquisitions through business combinations
Balance at 30 June 2016
Acquisitions through business combinations
Balance at 30 June 2017
Accumulated amortisation and impairment
Balance as at 1 July 2015
Amortisation expense
Balance at 30 June 2016
Amortisation expense
Balance at 30 June 2017
Net Book Value as at 30 June 2017
Net Book Value as at 30 June 2016
The following useful lives are used in the calculation of amortisation.
6,900
-
6,900
-
6,900
(6,071)
(766)
(6,837)
(63)
(6,900)
-
63
10,079
-
10,079
-
10,079
(6,316)
(674)
(6,990)
(675)
(7,665)
2,414
3,089
Customer relationships
Order backlog
9 years
1 to 9.5 years
Total
$’000
16,979
-
16,979
-
16,979
(12,387)
(1,440)
(13,827)
(738)
(14,565)
2,414
3,152
57
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 19 OTHER FINANCIAL ASSETS
Shares in other corporations at cost
(a)
Shares in subsidiaries
Details of Group Companies
Parent Entity:
BSA Limited
Ultimate Parent Entity:
BSA Limited
Name of Subsidiary
Mr Broadband Pty Limited
Allstaff Airconditioning Holdings Pty Limited
Allstaff Airconditioning (VIC) Pty Limited
Allstaff Airconditioning (NSW) Pty Limited
Allstaff Airconditioning (ACT) Pty Limited
Complex Airconditioning Pty Limited
BSA | Build
BSA | Build
BSA | Build
BSA | Build
BSA | Maintain
BSA | Maintain
ACN 085 921 615 Pty Ltd (Formerly Mr Antenna Pty Limited)
BSA | Connect
Satellite Receiving Systems (QLD) Pty Limited
BSA | Connect
ACN 066 496 893 Pty Ltd (Formerly Mr Alarms Pty Limited)
BSA | Connect
MEC Services Pty Limited
BSA Transmission Solutions Pty Limited
066 059 809 Pty Limited
Triple M Group Pty Limited
Triple M Mechanical Services Pty Limited
Triple M Mechanical Services (Qld) Pty Limited
Triple M Fire Pty Limited
Triple M Mechanical Services (Administration) Pty Limited
BSA Networks Pty Limited
BurkeAir Pty Limited
(b)
Deed of Cross Guarantee:
BSA | Maintain
BSA | Connect
BSA | Connect
BSA | Build
BSA | Build
BSA | Build
BSA | Build
BSA | Build
BSA | Connect
BSA | Maintain
2017
$’000
3
3
Consolidated
2016
$’000
3
3
Principal
Activity
Place of incorporation
2017
2016
Percentage owned (%)
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
Australia
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%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
All Controlled Entities are parties to the Deed of Cross Guarantee, where relief is obtained from preparing individual financial reports under ASIC
Corporations Legislative Instrument 2016/785, and are members of the Closed Group. Under the Deed, BSA Limited agrees to support the liabilities
and obligations of the Controlled Entities.
(c)
Tax Consolidation Group
All the controlled entities are part of the Tax Consolidation Group.
BSA Limited is the head entity in the Tax Consolidation Group.
58
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 19 OTHER FINANCIAL ASSETS (CONTINUED)
19.1
Composition of the Group
Information about the composition of the Group at the end of the reporting period is as follows:
Principal Activity
BSA | Connect
BSA | Build
BSA | Maintain
Place of incorporation
and operation
Australia
Australia
Australia
NOTE 20 DETAILS OF JOINT VENTURE
Details of the Group’s joint venture at the end of the reporting period is as follows:
Name of Joint Venture
Principal Activity
Place of incorporation and
principal place of business
Triple M and Premier Fire JV Co Limited Installation of fire services
Australia
Number of wholly-owned
subsidiaries
2017
2016
6
9
4
19
6
11
2
19
Proportion of ownership
interest and voting power
held by the group
2017
50%
2016
50%
The above joint venture is accounted for using the equity method in these consolidated financial statements.
Summarised financial information in respect of the Group’s material joint venture is set out below. The summarised financial information below
represents amounts shown in the joint venture’s financial statements prepared in accordance with AASBs (adjusted by the Group for equity
accounting purposes).
Triple M and Premier Fire JV Co Limited
Current Assets
Non-current assets
Current Liabilities
Non-current liabilities
The above amounts of assets and liabilities include the following:
Cash and cash equivalents
Current financial liabilities (excluding trade and other payables and provisions)
Non-current financial liabilities (excluding trade and other payables and provisions)
2017
$’000
1,040
-
(1,202)
-
482
-
-
2016
$’000
3,272
-
(3,306)
-
696
-
-
59
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 20 DETAILS OF JOINT VENTURE (CONTINUED)
Revenue
Profit or loss from continuing operations
Post-tax profit/(loss) from discontinued operations
Profit/(loss) for the year
Other comprehensive income for the year
Total comprehensive income for the year
Dividends received from the joint venture during the year
The above profit/(loss) for the year include the following:
Depreciation and amortisation
Interest income
Interest expenses
Income tax expense (income)
2017
$’000
-
-
-
-
-
-
-
-
-
-
-
Reconciliation of the above summarised financial information to the carrying amount of the interest in the joint venture recognised in the
consolidated financial statements:
Net liabilities of the joint venture
Proportion of the Group's ownership interest in the joint venture
Goodwill
Other adjustments
Carrying amount of the Group's interest in the joint venture
2017
$’000
(162)
50%
-
-
(81)
NOTE 21 AMOUNTS DUE FROM (TO) CUSTOMERS UNDER CONSTRUCTION CONTRACTS
Contracts in progress
Construction costs incurred plus recognised profits less recognised losses to date
Less: progress billings
Represented by amounts due:
- from customers under construction contracts (note 14)
- to customers under construction contracts (note 23)
Advances received from customers for contract work amounted to Nil (30 June 2016: $8,188,000)
60
2017
$’000
317,397
(262,523)
54,874
54,874
-
54,874
2016
$’000
19,212
(554)
-
(554)
-
(554)
-
-
-
-
(131)
2016
$’000
(34)
50%
-
-
(17)
2016
$’000
311,804
(263,877)
47,927
56,115
(8,188)
47,927
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 22 PARENT ENTITY DISCLOSURES
(a)
Financial Position
Assets
Current assets
Non-current assets
Total assets
Liabilities
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Accumulated losses
Profit Reserve
Reserves
Share-based payments reserve
Cash flow hedge reserve
Total equity
(b)
Financial Performance
Profit/(Loss) for the year
Other comprehensive income for the year, net of tax
Items that may be reclassified subsequently to profit or loss:
Gain recognised on cash flow hedges
Total comprehensive income for the year, net of tax
2017
$’000
42,492
40,560
83,052
36,176
2,298
38,474
44,578
97,564
(77,546)
23,137
1,423
-
44,578
Consolidated
2016
$’000
29,083
80,573
109,656
25,865
959
26,824
82,832
97,592
(39,306)
23,136
1,410
-
82,832
(38,239)
(3,880)
-
(38,239)
-
(3,880)
(c)
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
BSA Limited has entered into a cross guarantee with its wholly owned subsidiaries.
57,164
57,164
(d)
Contingent Liabilities
Under the above cross guarantee, BSA Limited, as the parent entity, guarantees all contingent liabilities of the wholly owned subsidiaries.
Guarantees established in favour of National Australia Bank Limited and Swiss Re International SE for Guarantees issued to various clients for
satisfactory contract performance, secured by cross guarantees from all wholly owned group members amounting to $8,754,000 (2016: $7,501,000
directly relating to the parent. Guarantees secured by cross guarantee by all group members amounted to $42,670,000 (2016:$39,420,000).
61
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 23 TRADE AND OTHER PAYABLES
Trade payables
Other payables
Work in progress
Amounts due to customers under construction contracts (see note 21)
Total Payables
Note
2017
$’000
41,771
27,809
18,740
-
88,320
Consolidated
2016
$’000
39,414
8,299
14,692
8,188
70,593
The average credit period on purchases is 32 days. The Group has financial risk management policies in place to ensure that all payables are paid
within the pre-agreed credit terms.
NOTE 24 BORROWINGS
CURRENT
Secured liabilities at amortised cost:
Hire purchase liabilities
Lease liabilities
Bank loans
Other
Total borrowings
NON-CURRENT
Secured liabilities at amortised cost:
Hire purchase liabilities
Lease liabilities
Bank loans
Total borrowings
Note
2017
$’000
Consolidated
2016
$’000
(b), 28(iii)
(b), 28(ii)
(a)
(b), 28(iii)
(b), 28(ii)
(a)
718
297
-
649
1,664
1,135
128
-
1,263
487
1,099
-
309
1,895
879
215
-
1,094
(a)
The bank loans of the Group are secured by fixed and floating charges registered by mortgage debenture over assets and undertakings of the parent
entity and its subsidiaries along with interlocking guarantees and indemnities for $57,164,000 between the parent entity and its subsidiaries. There
were no bank loans outstanding at year end.
The Group has Banking Facilities amounting to $51,500,000 which have an expiry date of 31 December 2018, including $26.5 million bank
guarantee facility drawn down per note 35c. Total loan facilities of $25 million were partially drawn down at 30 June 2017 per note 35c.
The covenants within the bank borrowings have the following ratios as at 30 June 2017:
Quarterly interest cover ratio greater than 3.5 times,
Quarterly total leverage ratio less than 3.5 times
62
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 24 BORROWINGS (CONTINUED)
Total financial assets pledged as security
CURRENT
Cash and cash equivalents
Trade and other receivables
Inventories
NON-CURRENT
Trade and other receivables
Other financial assets
Property, plant & equipment
Deferred tax assets
Goodwill
Other intangible assets
2017
$’000
16,432
99,043
2,174
117,649
2,248
3
9,522
6,124
15,185
2,414
35,496
153,145
Consolidated
2016
$’000
21,490
77,795
2,731
102,016
1,957
3
7,723
7,795
15,185
3,152
35,815
137,831
(b)
Lease liabilities and hire purchase liabilities are effectively secured as the rights to the assets recognised in the financial statements and revert to the
financier in the event of default.
Actual interest rates for hire purchase liabilities outstanding during the year ranged between 4.47% and 6.26%. Actual interest rates for lease liabilities
outstanding during the year ranged between 4.32% and 6.19%.
(c)
There were no defaults or breaches of any loan agreements during the current year.
63
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 25 PROVISIONS
Employee benefits
Other provisions (see below)
CURRENT
NON-CURRENT
Note
(i)
Other Provisions
Balance at 1 July 2016
Additional provisions recognised
Provisions reversed
Balance at 30 June 2017
NSW Office
of State
Revenue (ii)
2,736
2,500
-
5,236
Make
Good (iii)
280
1,082
-
1,362
2017
$’000
9,742
6,631
16,373
14,381
1,992
16,373
Contract
Provisions
(iv)
10,292
(10,259)
-
33
Consolidated
2016
$’000
9,428
13,308
22,736
21,684
1,052
22,736
Total
13,308
(6,677)
-
6,631
(i)
The provision for employee benefits represents annual leave and vested and non-vested long service leave entitlements accrued.
(ii)
The provision for NSW Office of State Revenue (OSR) relates to the following:
BSA has previously advised the market about a possible payroll-tax liability with the NSW Office of State Revenue (OSR). BSA has increased the
provision in its FY2017 accounts to $5,236,000 (FY2016 $2,736,000) as recognition of settlement up to 30 June 2016 as agreed with NSW OSR. The
Directors' estimate of any remaining payroll tax liability for FY2017 has been provided for in the financial statements.
(iii)
The provision for make good represents the estimated cost of work to comply with make good obligations in certain Group property leases.
(iv)
The provision for project provisions represents the expected cost of obligations under construction contracts recognised at the Directors' best
estimate of the expenditure to settle the Group's obligation.
64
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 26 ISSUED CAPITAL
(a)
Share capital
Ordinary shares - fully paid
(b)
Movements in ordinary share capital
Date
Details
1 July 2015
1 July 2016
Opening Balance
Opening Balance
Less: transaction costs arising on shares issued
30 June 2017
Balance
Parent Entity
2017
2016
Number of
Number of
Shares
Shares
422,907,346
422,907,346
$’000
97,592
97,592
(28)
97,564
Note
(c)
Number of
Shares
422,907,346
422,907,346
-
422,907,346
Changes to the Corporations Law abolished the authorised capital and par value concept in relation to share capital from 1 July 1998. Therefore the
Company does not have a limited amount of authorised capital and issued shares do not have a par value.
(c)
Ordinary Shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on winding up of the Company in proportion to the number of and
amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting in person or by proxy, is entitled to one vote, and upon a poll each share is
entitled to one vote.
(d)
Options
At 30 June 2017 no options were held over ordinary shares of the Company.
Share options granted under the Share Option Plan carry no rights to dividends and no voting rights. Further information relating to the BSA Limited
Employee Option Plan, including details of options issued, exercised and lapsed during the financial year and options outstanding at the end of the
financial year, is set out in Note 31.
(e)
Executive Securities Plan
The Company has established an Executive Securities Plan as a mechanism to provide the Company’s key Executives with a direct equity
involvement and incentive in the Company which aligns them with the shareholders.
(f)
Dividend Reinvestment Plan
The Company has established a dividend reinvestment plan under which holders of ordinary shares may elect to have all or part of their dividend
entitlements satisfied by the issue of new ordinary shares rather than by being paid in cash. The Dividend Reinvestment Plan has been suspended
since the final dividend for 30 June 2012.
(g)
Rights
Information relating to the BSA Limited Performance Rights Plan, including details of rights issued, exercised and lapsed during the financial year
and rights outstanding at the end of the financial year, is set out in Note 31.
65
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 27 RESERVES AND ACCUMULATED LOSSES
(a)
Reserves
Share-based payments reserve
Share-based payments reserve
Opening balance
Rights expense
Shares issued in satisfaction of performance conditions
Closing balance
2017
$’000
1,423
1,423
1,410
54
(41)
1,423
Consolidated
2016
$’000
1,410
1,410
1,410
-
-
1,410
The share-based payments reserve relates to share options and share rights granted to employees under the Employee Share Option Plan and the
Employee Performance Rights Plan. Further information about share-based payments to employees is set out in note 31.
The share-based payments reserve records items recognised as expenses on valuation of employee share options and rights.
(b)
Accumulated losses
Movements in accumulated losses were as follows:
Balance at beginning of year
Net loss for the year
Balance at end of year
(c)
Profit Reserve
Movements in profit reserve were as follows:
Balance at beginning of year
Net profit for the year
Dividends
Balance at end of year
(65,243)
-
(65,243)
7,737
3,963
-
11,700
(63,024)
(2,219)
(65,243)
7,737
-
-
7,737
66
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 27 RESERVES AND ACCUMULATED LOSSES (CONTINUED)
(d)
Dividends on equity instruments
Recognised amounts
Fully paid ordinary shares
Interim dividend:
Final dividend:
Unrecognised amounts
Fully paid ordinary shares
Final dividend:
Year ended 30/06/17
Year ended 30/06/16
Cents per share
Total ‘000
Cents per share
Total ‘000
-
-
-
-
0.50
2,115
-
-
-
-
-
-
On 28 August 2017 the Directors declared a fully franked dividend of 0.50 cent per share to the holders of fully paid ordinary shares in respect of
the financial year ended 30 June 2017, to be paid to shareholders on 2 November 2017. This dividend has not been included as a liability in these
consolidated financial statements. The dividend will be paid to all shareholders on the Register of Members on 12 October 2017. The total estimated
dividend to be paid is $2,115,000.
(e)
Franked credits
Franking account balance as at 30 June
Franking credits that will attach to the payment of dividends proposed or declared before
the financial report was authorised for issue but not recognised as a distribution to equity
holders during the period.
Net franking credits available
2017
$’000
16,285
(902)
15,383
Consolidated
2016
$’000
16,285
-
16,285
67
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 28 CAPITAL AND LEASING COMMITMENTS
Note
2017
$’000
Consolidated
2016
$’000
(i)
Operating Lease Commitments
The Group leases various offices and warehouses under non-cancellable operating leases expiring within one to five years. The leases have varying
terms, escalation clauses and renewal rights. On renewal, the terms of the leases are renegotiated.
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
(ii)
Finance Lease Commitments
2,956
6,540
-
9,496
4,438
1,483
-
5,921
The Group leases various plant and equipment with a carrying amount of $728,000 (2016: $1,501,000) under finance leases expiring within one to four
years. Under the terms of the leases, the Group has the option to acquire the leased assets after paying the residual amount on expiry of the leases.
Commitments in relation to finance leases are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
Minimum lease payments
Less future finance charges
Total Lease Liability
Represented by:
Current liability
Non-current liability
(iii)
Hire Purchase Commitments
326
137
-
463
(38)
425
297
128
425
1,218
318
-
1,536
(222)
1,314
1,099
215
1,314
24
24
The Group has purchased various plant and equipment with a carrying amount of $1,751,000 (2016: $1,177,000) under hire purchase agreements
expiring within one to four years. Under the terms of the agreements, the Group has the option to acquire the assets after paying the residual
amount on expiry of the agreements.
Commitments in relation to hire purchase agreements are payable as follows:
Within one year
Later than one year but not later than five years
Later than five years
Minimum payments
Less future finance charges
Total Hire Purchase Liability
Represented by:
Current liability
Non-current liability
68
798
1,235
-
2,033
(180)
1,853
718
1,135
1,853
562
939
-
1,501
(135)
1,366
487
879
1,366
24
24
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 29 SEGMENT INFORMATION
(a)
AASB 8 Operating Segments
AASB 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by
the chief operating decision maker in order to allocate resources to the segment and to assess its performance.
(b)
Products and services from which reportable segments derive their revenues
The Group is organised into the following reportable segments:
BSA | Connect
BSA | Connect provides contracting services to the telecommunications, subscription television and communication industries. The contracting
services include the delivery of bundled services over fixed line multi-technology services and networks and the installation of subscription
television.
BSA | Build
BSA | Build provides the design and installation of building services for commercial and industrial buildings including: Mechanical Services, Air
Conditioning, Heating and Ventilation, Refrigeration and Fire services.
BSA | Maintain
BSA | Maintain provides the maintenance of building services for commercial and industrial buildings including: Mechanical Services, Air
Conditioning, Heating and Ventilation, Refrigeration and Fire services.
(c)
Segment revenues and results
The following is an analysis of the Group’s revenue and results by reportable operating segment:
BSA | Connect
BSA | Build
BSA | Maintain
Other
Revenue
Year Ended
30 Jun 17
$’000
186,531
216,626
89,547
166
492,870
30 Jun 16
$’000
205,731
226,392
79,853
96
512,072
Segment Profit/Loss
Year Ended
30 Jun 17
$’000
30 Jun 16
$’000
8,043
352
2,762
-
11,157
6,183
(3,285)
(312)
-
2,586
Corporate costs including acquisition, legal and advisory
(4,928)
(4,859)
Finance costs
Profit/(Loss) before tax
(595)
(741)
5,634
(3,014)
Segment revenue reported above represents revenue generated from external customers. There were no inter-segment sales in the current year (2016: Nil).
The accounting policies of the reportable segments are the same as the Group’s accounting policies described in note 3. Segment profit/loss
represents the profit/loss earned by each segment without allocation of central administration costs and Directors’ salaries, investment income,
gains and losses, finance costs and income tax expense. This is the measure reported to the chief operating decision maker for the purposes of
resource allocation and assessment of segment performance.
69
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 29 SEGMENT INFORMATION (CONTINUED)
(d)
Segment assets and liabilities
Segment assets
BSA | Connect
BSA | Build
BSA | Maintain
Consolidated assets
Segment liabilities
BSA | Connect
BSA | Build
BSA | Maintain
Consolidated liabilities
Year Ended
30 Jun 17
$’000
50,260
73,934
28,951
30 Jun 16
$’000
37,936
80,406
19,489
153,145
137,831
40,711
49,019
17,971
33,768
52,950
9,617
107,701
96,335
For the purposes of monitoring segment performance and allocating resources between segments.
*
*
All assets, except cash, are allocated to reportable segments. In 2017 and 2016, cash is allocated to BSA | Connect, who operate the Group's
treasury. Goodwill is allocated to reportable segments as described in note 17. Assets used jointly by reportable segments are allocated on the basis
of the revenues earned by individual reportable segments; and
All liabilities are allocated to reportable segments. Liabilities for which reportable segments are jointly liable are allocated in proportion to segment assets.
(e)
Other segment information
Continuing operations
(1) BSA | Connect
BSA | Build
BSA | Maintain
Depreciation and amortisation
Additions to non-current assets
Year Ended
Year Ended
30 Jun 17
$’000
30 Jun 16
$’000
30 Jun 17
$’000
30 Jun 16
$’000
2,041
1,034
1,923
2,357
1,811
2,301
3,974
715
1,449
731
920
428
4,998
6,469
6,138
2,079
(1) BSA | Connect includes Corporate depreciation amortisation of $578,000 and Corporate Additions to non-current assets of $2,090,000.
70
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 29 SEGMENT INFORMATION (CONTINUED)
(f)
Geographical information
The Group only operates in Australia.
The Group’s revenue from continuing operations from external customers and information about its non-current assets by geographical location are
detailed below:
Australia
Revenue from external customers
Non-current assets
Year ended
Year Ended
30 Jun 17
$’000
492,870
492,870
30 Jun 16
$’000
512,072
512,072
30 Jun 17
$’000
35,496
35,496
30 Jun 16
$’000
35,815
35,815
(g)
Information about major customers
The Group has a number of customers to whom it provides both products and services. The Group supplies a single external customer in the
BSA | Connect segment who accounts for 17% of external revenue (2016:26%). The Group's next most significant client is in the BSA | Connect
segment and accounts for 10% of external revenue (2016: 8% in the BSA | Build segment).
71
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 30 CASH FLOW INFORMATION FOR THE PERIOD
(a)
Reconciliation of profit/(loss) to net cash flows from operating activities for the year
Profit/(Loss) for the year
Depreciation
Amortisation
Share-based payment expense
Net profit on sale of non-current assets
Change in operating assets and liabilities
Increase in trade receivables
Decrease in inventories
Decrease/(increase) in deferred tax asset
Increase in other operating assets
Increase in trade payables
Increase/decrease in other operating liabilities
(Decrease)/increase in provisions
Net cash (used by)/generated by operating activities
2017
$’000
3,963
4,260
738
54
(387)
(1,695)
557
1,672
(19,586)
2,357
13,652
(6,363)
(778)
Consolidated
2016
$’000
(2,219)
5,029
1,440
-
(120)
(5,580)
1,969
(795)
(2,311)
7,913
(7,210)
3,920
2,036
(b)
Non-cash transactions
During the year the consolidated entity acquired plant and equipment with an aggregate value of $1,101,000 (2016:$659,000) by means of finance
leases. These acquisitions are not reflected in the statements of cash flows.
2017
$’000
20,000
-
20,000
5,000
(2,277)
2,723
Consolidated
2016
$’000
20,000
-
20,000
5,000
(2,679)
2,321
(c)
Credit Standby Arrangements with Banks
Credit facility
Amount utilised
Unused credit facility
The major facility is summarised as follows:
A Working Capital Facility which covers the financial requirements of the day to day operations of the Group.
(d)
Master Asset Finance Facilities
Total asset finance facility
Amount utilised
Total unused Master Asset Finance Facility
72
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 30 CASH FLOW INFORMATION FOR THE PERIOD (CONTINUED)
(e)
Loan facilities
Loan facilities
Amount utilised
Unused loan facility
The major facilities are summarised as follows:
Acquisition Finance Loans
2017
$’000
-
-
-
Consolidated
2016
$’000
-
-
-
Finance will be provided under the facility, provided the Company and the consolidated entity has not breached any borrowing requirements and
the required financial ratios are met. During the year, the Company and the consolidated entity have not breached any borrowing requirements.
(f)
Guarantees
Guarantees to the value of $24,028,000 were utilised at 30 June 2017 (2016: $20,424,000), and are secured by fixed and floating charge to the
bank over the assets of the Company together with guarantees in favour of the parent given by all controlled entities.
(g)
Surety Bonds
Surety Bonds of which $18,642,000 were utilised at 30 June 2017 (2016: $18,996,000), are unsecured.
NOTE 31 SHARE-BASED PAYMENTS
(a)
Employee Option Plan
The establishment of the BSA Limited Employee Option Plan was approved by shareholders at the 2004 AGM. Staff eligible to participate are those
who are full time or permanent part-time employees of any company in the Group, including an Executive Director and Non-Executive Director of
the company and whom the Board of Directors has sole discretion to determine to be eligible to participate but does not include a person who has a
relevant interest in greater than 5% of the issued ordinary share capital of the Company.
The exercise price and exercise period applicable to any options to be offered under the Option Plan will, at or before the time of issuing an
invitation to eligible employees to subscribe for options, be determined by the Board in its absolute discretion.
Subject to any restrictions in the Listing Rules or the Corporations Act 2001, the Board may in its absolute discretion impose on the options such other
terms as it considers appropriate.
As soon as practicable after receipt of a valid notice of exercise of an option together with the exercise price the Company will allot the appropriate
number of ordinary shares. Any shares issued on the exercise of the options granted pursuant to the resolution will be officially quoted and will rank
equally with all other shares on issue in the Company and all the rights and entitlements of the holders in respect of those shares will be identical to the
rights and entitlements of the holders of the currently issued shares in the Company.
Options can only be exercised after three years if the employee remains in the employment of the Company and the option will then expire two
years after this date. If the employee terminates their employment within the three years, the option is exercisable for twelve months from the date
after termination. If the Company is subject to a takeover the option will vest and be exercisable for a period of three months.
Options may not be transferred, though prior to issue a nominee may be advised for consideration by the Board.
There were no options outstanding at 30 June 2017 (2016: Nil).
Fair value of options granted
There have been no options granted since 25 November 2004 under this scheme. As referred to in the Remuneration Report on page 19,
78,200 options previously granted in connection with rights granted under the BSA Performance Rights Plan, as a consequence of
the 2014 captial raising, were exercised during the year.
There is no employee benefits expense in the Consolidated Statement of Profit or Loss and Other Comprehensive Income (2016: nil), which
relates to equity-settled share-based payment transactions.
73
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 31 SHARE-BASED PAYMENTS (CONTINUED)
(b)
Employee Share Scheme
A scheme under which shares were issued by the Company to employees for no cash consideration was ratified by shareholders at the 2004 AGM.
All permanent employees (including Executive Directors) who were continuously employed by the consolidated entity for a period of at least one
year were eligible to participate in the scheme. Employees could elect not to participate in the scheme.
Under the scheme, eligible employees were offered $1,000 worth of fully-paid ordinary shares in BSA Limited for the Year Ended 30 June 2004 for
no cash consideration. The market value of shares issued under the scheme, measured as the weighted average market price on the day of issue of
the shares, was recognised in the Consolidated Statement of Financial Position as share capital and as part of employee benefit cost.
Offers under the scheme are at the discretion of the Company. No offers were made to any director or employee of BSA Limited during the year
ended 30 June 2017 (2016: Nil).
Shares under the scheme may not be sold until the earlier of three years after issue or cessation of employment with the consolidated entity. In all
other aspects the shares rank equally with other fully-paid ordinary shares on issue (see note 26(c)).
The number of shares issued to participants in the scheme is the offered amount divided by the weighted average price at which the Company's
shares are traded on the Australian Stock Exchange during the five trading days immediately before the date of the offer.
(c)
Executive Securities Plan
The establishment of the BSA Executive Securities Plan was approved by shareholders at the 2005 AGM. The Plan was established as a mechanism
to provide the Company's key executives with a direct equity interest in the Company to better align them with the shareholders.
The number of securities to be offered and the time at which securities may be offered from time to time to executives and the price and terms of
payment, shall be determined by the Board in its discretion.
The Board may at such times as it determines invite any executive to be a member of the Plan.
This plan provided for the Company to provide loans to executives to acquire shares. The maximum amount of any loan is not to exceed the
total subscription price for the shares applied for.
The terms of the loan included a provision that no interest is payable by the Borrower under the Loan Agreement.
All shares are held in escrow until loans are fully repaid. An executive must not sell, mortgage, charge, assign or otherwise dispose of or
encumber any shares before payment or repayment of any loan outstanding to the Company.
Subject to this restriction and to the terms of the loan from the Company (if any), an executive shall from the Date of Allotment, be the
absolute beneficial owner of the shares.
Unless the Directors of the Company otherwise provide in the terms of any invitation, all Plan Shares shall rank for dividends declared on
or after the Date of Allotment and shall in all respects rank equally with and have the same rights and entitlements as all other fully paid
ordinary shares of the Company.
No offers were made under the Executive Securities Plan to any Directors or employees of BSA Limited during the year ended 30 June 2017.
Under the Loan Agreement, the borrower shall repay the balance outstanding of the Outstanding Principal when the borrower ceases to be an
employee or Director of the Lender. BSA Limited has adopted the policy of having a rolling three year maturity date for all Executives who do not
have a termed employment contract.
Set out below are summaries of securities accepted under the plan:
Consolidated and parent entity
Issue Price
Balance at Start
Granted During
Released from Escrow
Balance in Escrow
Grant Date
Expiry Date
(cents)
of the Year
n/a
n/a
n/a
n/a
n/a
n/a
0.23
0.63
0.68
0.68
0.68
0.10
Number
700,000
1,600,000
150,000
200,000
400,000
1,700,000
4,750,000
13 Oct 2006
19 Jul 2007
11 Sep 2007
13 Sep 2007
14 Dec 2007
10 Feb 2009
Total
74
the Year
Number
-
-
-
-
-
-
-
During the Year
at End of the Year
Number
-
-
-
-
-
-
-
Number
700,000
1,600,000
150,000
200,000
400,000
1,700,000
4,750,000
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 31 SHARE-BASED PAYMENTS (CONTINUED)
(d)
Employee Performance Rights Plan
At the AGM held on 25 November 2008, shareholders approved the introduction of the BSA Employee Performance Rights Plan.
This incentive plan is designed to increase the motivation of eligible key staff and to create a stronger link between increasing shareholder
value and employee reward.
To achieve its corporate objectives, the Company needs to attract and retain key staff. The Board believes that awards made to selected
eligible employees under this plan:
•
•
•
•
•
Provide an incentive for the creation of, and focus on, shareholder wealth;
Enable the Company to recruit and retain the talented people needed to achieve the Company’s business objectives;
Link the reward of key staff with the achievement of strategic goals and the performance of the Company;
Align the financial interests of participants with those of Company shareholders; and
Ensure the remuneration packages of employees are consistent with market practice.
Vesting of rights or shares under this Plan requires the achievement of appropriate perfomance or service hurdles to be determined by the Board:
(i) Service condition of a specified period; or
(ii) The Company’s performance as measured by earnings per share (EPS), being the EPS for the relevant Measurement Period as
determined by the Board having regard to the financial statements. Certain growth in EPS for the shares must be attained in
respect of each Measurement Period and pro-rata in respect of the initial Measurement Period. The Company must achieve these
performance conditions before the rights vest.
Once rights have been exercised by an eligible employee (subject to relevant service or performance conditions being met), the
Company may make non-refundable contributions to either fund the purchase of a new plan share, or to acquire on the ASX existing
shares and transfer these to an eligible employee.
The specific terms of a particular grant, including any performance conditions, will be contained in the invitation and associated
documentation sent to the eligible employee.
A right granted to a participant is not transferable and may not otherwise be dealt with, except with the Board’s approval, or by
operation of law on death or legal incapacity.
Rights to acquire shares are not exercisable until the end of the final measurement period, and until those rights have satisfied all
vesting conditions and any performance hurdles established by the Board. This is subject to a number of exceptions (including death,
cessation of employment, takeovers and schemes of arrangement). The rights will have a specified life determined by the Board. All
grants of rights will have a life terminating five (5) years after the grant date or such other date as determined by the Board.
On or after the end of the final measurement period and provided any performance hurdle prescribed by the Board has been achieved
and, where applicable, to the extent it has been achieved, the plan participant may then acquire shares by exercising the rights.
A right lapses if the vesting conditions are not met.
75
BSA LIMITED ANNUAL REPORT 2017 NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 31 SHARE-BASED PAYMENTS (CONTINUED)
Consolidated and parent entity
Grant
Date
Exercise
Date
Expiry
Date
Exercise
Price
(cents)
14 Nov 11
14 Nov 14
14 Nov 16
25 Nov 14
30 Jun 15
25 Nov 17
29 Nov 16
6 Feb 17
29 Nov 21
29 Nov 16
1 Sep 17
29 Nov 21
-
-
-
-
Balance
at Start
of the
Year
Under
Right
Balance
at Start
of the
Year
Under
Option
Granted
During
the Year
Under
Right
Granted
During
the Year
Under
Option
Exercised
During
the Year
Under
Right
Exercised
During
the Year
Under
Option
Cancelled
During
the Year
Under
Right
Cancelled
During
the Year
Under
Option
Balance
in Escrow
at End of
the Year
Under
Right
Balance
in Escrow
at End of
the Year
Under
Option
Number
Number Number Number
Number
Number
Number
Number
Number
Number
621,000
422,280
1,116,667
-
-
-
-
90,322
-
-
- 200,000
-
-
-
-
-
(115,000)
(78,200)
(506,000)
(344,080)
-
-
-
-
-
-
-
-
-
-
-
-
-
1,116,667
90,322
200,000
(115,000)
(78,200)
(506,000)
(344,080)
1,406,989
-
-
-
-
-
Total
1,737,667
422,280 290,322
In addition, the Board has approved that Nicholas Yates be awarded 142,857 performance rights with an exercised price of $0.35 per right, but subject to a
tenure of 12 months from 31 January 2017 to 31 January 2018. These are subject to the approval of shareholders at the 2017 AGM.
NOTE 32 EVENTS OCCURRING AFTER THE BALANCE DATE
During August 2017 BSA reached an in principle agreement with NSW OSR closing out all payroll tax issues up to 30 June 2016. This resulted in an
additional $2.5 million provision taken up in the FY2017 accounts.
The Directors are not aware of any other significant events since the end of the reporting period.
NOTE 33 RELATED PARTY TRANSACTIONS
Transactions between related parties are on normal commercial terms and conditions no more favourable than those to other parties unless
otherwise stated.
(a)
Transactions with related parties:
2017
$
Consolidated Entity
2016
$
Rent was paid to The Day Street Unit Trust in which M Lowe, a Director, has a beneficial
178,496
178,496
interest
Outstanding balances arising from purchases of services
No balances are outstanding at the reporting date in relation to transactions with related parties (2016: Nil)
76
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 33 RELATED PARTY TRANSACTIONS (CONTINUED)
(b)
Equity instrument disclosures relating to Key Management Personnel
(i) Rights holdings
The numbers of rights over ordinary shares in the Company held during the financial year by each Director of BSA Limited and other Key
Management Personnel of the Group, including their personally related parties, are set out below.
Balance at
Net
Balance
the start of
Granted as
Rights
Change
at End of
Vested
but Not
Vested
Vesting
and
During
Rights
2017
the year
Compensation
Exercised
Other
Year
Exercisable
Exercisable
Year
Nicholas Yates
Nicholas Benson
1,116,667
-
-
90,322
1,116,667
90,322
-
-
-
-
-
1,116,667
90,322
-
1,206,989
-
-
-
1,116,667
-
90,322
90,322
1,206,989
90,322
In addition, the Board has approved that Nicholas Yates be awarded 142,857 performance rights with a strike rate of $0.35 per right, but subject to a
tenure of 12 months from 31 January 2017 to 31 January 2018. These are subject to the approval of shareholders at the 2017 AGM.
Balance at
Net
Balance
the start of
Granted as
Rights
Change
at End of
Vested
but Not
Vested
Vesting
and
During
Rights
2016
the year
Compensation
Exercised
Other
Year
Exercisable
Exercisable
Year
Nicholas Yates
1,116,667
1,116,667
-
-
-
-
-
-
1,116,667
1,116,667
-
-
1,116,667
1,116,667
1,116,667
1,116,667
Further details of schemes can be found in the Directors’ Report.
77
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 33 RELATED PARTY TRANSACTIONS (CONTINUED)
(ii) Share holdings
The numbers of shares in the Company held during the year by each Director of BSA Limited and other key management personnel of the Group,
including their personally related parties, are set out below. There were no shares granted during the reporting period as compensation.
Balance at
the start of
Rights
the year
Exercised
Other Changes
During the Year
Balance at the
Balance
End of the Year
Held Nominally
2017
Directors of BSA Limited
Ordinary Shares
Mark Lowe
Paul Teisseire
Michael Givoni
Graeme Barclay
Nicholas Yates
10,115,403
680,012
636,400
-
2,727,273
Ordinary Shares - Escrowed
Mark Lowe
200,000
Key Management Personnel
Ordinary Shares
Nicholas Benson
1,363,636
15,722,724
-
-
-
-
-
-
-
-
-
-
160,000
-
-
-
10,115,403
680,012
796,400
-
2,727,273
200,000
1,363,636
160,000
15,882,724
-
-
-
-
-
-
-
-
Max Cowley is a nominee director of Birketu Pty Ltd and is also a director of Birketu Pty Ltd. Birketu Pty Ltd holds shares in BSA Limited of
67,204,000 (2016: 66,000,000). Max Cowley has no beneficial interest in Birketu Pty Ltd.
2016
the year
Exercised
During the Year
End of the Year
Held Nominally
Balance at
the start of
Rights
Other Changes
Balance at the
Balance
Directors of BSA Limited
Ordinary Shares
Mark Lowe
Paul Teisseire
Michael Givoni
Graeme Barclay
Nicholas Yates
Ordinary Shares - Escrowed
Mark Lowe
Key Management Personnel
Ordinary Shares
Nicholas Benson
78
10,115,403
680,012
636,400
-
2,727,273
200,000
1,363,636
15,722,724
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
10,115,403
680,012
636,400
-
2,727,273
200,000
1,363,636
15,722,724
-
-
-
-
-
-
-
-
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 33 RELATED PARTY TRANSACTIONS (CONTINUED)
(c)
Executive Securities Loans
Balance at
Notional
Notional
Interest
End of Year
Interest Charged
Not Charged
Provision for
Impairment
Number of
Individuals
$000
$000
$000
$000
Opening
Balance
$000
1,734
1,705
1,473
1,473
1,477
2,552
2,656
2,487
2,437
1,029
833
807
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
1,661
1,734
1,705
1,473
1,473
1,477
2,552
2,656
2,487
2,437
1,029
833
1
29
232
90
90
93
44
334
171
148
63
26
-
-
-
-
-
-
-
-
-
-
-
-
Individuals with loans above $100,000 in reporting period
Opening
Notional Interest Charged Using
Balance at End
2017
Balance
Effective Interest Rate Method
Brendan Foley
Ray Larkin
Leaston Paull
Bryce Wood
Peter Tripodi *
Younis Tehfe
$
590,065
227,228
227,228
192,919
143,750
135,373
$
347
134
134
113
-
80
of Year
$
590,412
227,362
227,362
193,032
143,750
135,453
* Balance at year end stated at actual date to the terms of the loans
Opening
Notional Interest Charged Using
Balance at End
2016
Balance
Effective Interest Rate Method
Brendan Foley
Ray Larkin
Leaston Paull
Bryce Wood
Peter Tripodi *
Younis Tehfe
$
579,242
223,011
223,011
189,339
143,750
132,733
$
10,823
4,217
4,217
3,580
-
2,640
* Balance at year end stated at actual due to the terms of the loans.
of Year
$
590,065
227,228
227,228
192,919
143,750
135,373
74
-
-
-
-
-
-
-
-
-
-
-
11
11
11
11
11
11
13
13
13
13
6
1
Highest Balance
During Period
$
590,412
227,362
227,362
193,032
143,750
135,453
Highest Balance
During Period
$
590,065
227,228
227,228
192,919
143,750
135,373
The above current loans represent unsecured loans to purchase shares in BSA Limited which was passed at a meeting of members held on 12
December 2005. The shares were issued between 13 October 2006 and 10 February 2009 at values ranging from 10.0 cents per share to 68.0 cents
per share. The loans are repayable on the termination of each individual from the Company and do not bear interest. These loans have been booked
into the accounts at net present value on a rolling three year basis.
At the discretion of the Board, the above loan to Peter Tripodi was not repaid at the termination date. The outstanding principal is now due and
receivable and actions to recover are under way.
79
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 34 FINANCIAL INSTRUMENTS
Fair value of financial instruments carried at amortised cost.
The Directors consider that the carrying amounts of financial assets and financial liabilities recognised at amortised cost in the financial statements
approximate their fair values.
Financial Assets
Cash and cash equivalents
Loans and receivables
Trade and other receivables
2017
$’000
Consolidated
2016
$’000
16,432
21,490
100,001
78,378
Financial Assets at amortised cost
116,433
99,868
Financial liabilities
Financial liabilities held at amortised cost
Trade and other payables
Borrowings
78,578
2,927
61,165
2,989
Financial liabilities at amortised cost
81,505
64,154
NOTE 35 FINANCIAL RISK MANAGEMENT
(a)
General objectives, policies and processes
In common with all other businesses, the Group is exposed to financial risks that arise. This note describes the Group’s objectives, policies and
processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented
throughout these financial statements.
There have been no substantive changes in the Group’s exposure to financial instrument risks, its objectives, policies and processes for managing
those risks or the methods used to measure them from previous periods unless otherwise stated in this note.
The principal financial instruments from which financial instrument risk arises are:
- Trade receivables;
- Cash at bank;
- Bank overdrafts;
- Trade and other payables; and
- Borrowings.
The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and, whilst retaining ultimate
responsibility for them, it has delegated the authority for designing and operating processes that ensure the effective implementation of the
objectives and policies to the Group’s finance function. The Group’s risk management policies and objectives are therefore designed to minimise
the potential impacts of these risks on the results of the Group where such impacts may be material. The Board receives monthly reports from the
Finance Department through which it reviews the effectiveness of the processes put in place and the objectives and policies it sets. The overall
objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the Group’s competitiveness and flexibility.
80
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 35 FINANCIAL RISK MANAGEMENT (CONTINUED)
(b)
Credit Risk
Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the Group incurring a financial
loss. This usually occurs when debtors fail to settle their obligations owing to the Group.
Trade receivables consist of a large number of customers. The Group does not have significant credit risk exposure to any single counterparty or
group of counterparties having similar characteristics. The Group defines counterparties as having similar characteristics if they are related entities.
Concentration of credit risk to the largest counterparty did not exceed 9% of gross monetary assets at balance date. Concentration of credit risk to
any other counterparty did not exceed 9% of gross monetary assets at balance date.
The maximum exposure to credit risk at balance date is as follows:
Receivables
2017
$’000
101,291
101,291
Included in loans and receivables, the most significant customer accounts for 6.6% of trade receivables at 30 June 2017 (2016: 5.9%).
The maximum exposure to credit risk at balance date by country is as follows:
Australia
2017
$’000
101,291
101,291
The maximum exposure to credit risk for cash and trade receivables at balance date by type of customer is as follows:
BSA | Connect
BSA | Build
BSA | Maintain
2017
$’000
35,792
41,628
23,871
101,291
The Group's most significant customer, a BSA | Build customer, accounts for $4,210,000 of trade receivables at 30 June 2017.
At 30 June 2016, the Group's most significant customer was a BSA | Build customer which accounted for $3,665,000.
All major customers are credit worthy, as detailed above.
The Group has significant concentration of credit risk as all loans and lease liabilities are with the one financial institution.
Consolidated
2016
$’000
79,752
79,752
Consolidated
2016
$’000
79,752
79,752
Consolidated
2016
$’000
23,939
38,498
17,315
79,752
81
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 35 FINANCIAL RISK MANAGEMENT (CONTINUED)
(c)
Liquidity risk
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has established an appropriate liquidity risk
management framework for the management of the Group’s short, medium and long-term funding and liquidity management requirements. The
Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring
forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. The table below sets out details of additional
undrawn facilities that the Group has at its disposal to further reduce liquidity risk.
Financing arrangements
The following financing facilities were available at balance date:
Credit stand-by arrangements
Total facilities:
Corporate Market Loan
Used at balance date:
Corporate Market Loan
Unused at balance date:
Corporate Market Loan
Bank loans
Total facilities:
Used at balance date
Unused at balance date
2017
$’000
20,000
20,000
-
-
20,000
20,000
-
-
-
Consolidated
2016
$’000
20,000
20,000
-
-
20,000
20,000
-
-
-
Total unused credit facilities at balance date
20,000
20,000
Master Asset Finance Facility
Total facilities:
Used at balance date
Total unused Master Asset Finance Facility
Total unused Facilities at balance date
5,000
2,278
2,722
22,722
5,000
2,680
2,320
22,320
In addition to the above arrangements the consolidated entity has a bank guarantee facility of $26,500,000 (2016:$26,500,000) which was utilised
to $24,028,000 (2016: $20,424,000).
In addition to the above facilities the consolidated entity has a surety bond facility with Swiss Re International SE of $30,000,000 (2016:$20,000,000)
which was utilised to $18,642,000 (2016: $18,996,000).
Refer Note 24(a) for details of terms of financing arrangements.
82
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 35 FINANCIAL RISK MANAGEMENT (CONTINUED)
Maturity Analysis - Group
The following table details the Group’s remaining contractual maturity for its financial liabilities with agreed repayment periods. The table has been
drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay. The table
includes both interest and principal cash flows. To the extent that interest flows are at floating rate, the undiscounted amount is derived from interest
rate curves at the end of the reporting period. The contractual maturity is based on the earliest date on which the Group may be required to pay.
The table below includes the weighted average effective interest rate and a reconciliation to the carrying amount in the Statement of Financial
Position as an example of summary quantitative data about exposure to interest rates at the end of the reporting period that an entity may provide
internally to management personnel.
Financial Liabilities
30 June 2017
Bank loans
Other
Trade payables
Other payables
Finance lease and hire purchase liabilities
TOTAL
30 June 2016
Bank loans
Other
Trade payables
Other payables
Finance lease and hire purchase liabilities
TOTAL
Carrying
Contractual Cash
Amount
$’000
-
649
41,771
62,922
2,278
107,620
Flows
$’000
-
649
41,771
62,922
2,496
< 6
mths
$’000
-
649
41,771
62,922
562
107,838
105,904
Carrying
Contractual Cash
Amount
$’000
-
309
39,414
53,915
2,680
96,318
Flows
$’000
-
309
39,414
53,915
3,037
96,675
< 6
mths
$’000
-
309
39,414
53,915
890
94,528
6- 12
mths
$’000
-
-
-
-
562
562
6- 12
mths
$’000
-
-
-
-
890
890
1-3
years
$’000
-
-
-
-
1,372
1,372
1-3
years
$’000
-
-
-
-
1,257
1,257
> 3
years
$’000
-
-
-
-
-
-
> 3
years
$’000
-
-
-
-
-
-
The following table details the Group’s expected maturity for its non-derivative financial assets. The table has been drawn up based on the undiscounted
contractual maturities of the financial assets including interest that will be earned on those assets. The inclusion of information on non-derivative financial
assets is necessary in order to understand the Group’s liquidity risk management as the liquidity is managed on a net asset and liability basis.
Financial Assets
30 June 2017
Trade receivables
Other receivables
TOTAL
30 June 2016
Trade receivables
Other receivables
TOTAL
Carrying
Contractual Cash
Amount
$’000
8,026
93,265
101,291
Flows
$’000
8,186
93,070
101,256
Carrying
Contractual Cash
Amount
$’000
5,182
74,570
79,752
Flows
$’000
5,381
75,641
81,022
< 6
mths
$’000
8,186
91,409
99,595
< 6
mths
$’000
5,381
72,356
77,737
6- 12
mths
$’000
-
119
119
6- 12
mths
$’000
-
1,328
1,328
1-3
years
$’000
-
-
-
1-3
years
$’000
-
-
-
> 3
years
$’000
-
1,542
1,542
> 3
years
$’000
-
1,957
1,957
83
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 35 FINANCIAL RISK MANAGEMENT (CONTINUED)
(d) Market Risk
Interest rate risk
The Group's main interest rate risk arises from long-term borrowings. Borrowings issued at variable rates expose the Group to cash flow interest rate
risk. Management actively manage the risk by activating various options including utilising a mix between fixed and floating rate borrowings and by
using interest rate swap contracts. As at 30 June 2017 there were no bank borrowings.
NOTE 36 CAPITAL RISK MANAGEMENT
In managing its capital, the Group’s primary objective is to ensure its continued ability to provide a consistent return for its equity shareholders through
a combination of capital growth and distributions. In order to achieve this objective, the Group seeks to maintain a gearing ratio that balances risks and
returns at an acceptable level and also to maintain a sufficient funding base to enable the Group to meet its working capital and strategic investment
needs. In making decisions to adjust its capital structure to achieve these aims, either through altering its dividend policy, new share issues or the
reduction of debt, the Group considers not only its short-term position but also its long-term operational and strategic objectives.
It is the Group’s policy to review its gearing ratio to ensure adequate funds are available to meet its obligations. The Group’s gearing ratio at the
balance sheet date is shown below :
Gearing ratios
Net (cash) / debt
Total equity
Total Gearing Ratio
2017
$’000
(13,505)
45,444
(29.72%)
Consolidated
2016
$’000
(18,501)
41,496
(44.59%)
Gearing levels were maintained at a healthy position at 30 June 2017. The net cash position was impacted by late receipts in BSA | Build and cash
outgoings to close out the nRAH project in the second half not recovered by 30 June 2017. It is the Board's intention to monitor gearing levels going
forward to ensure flexibility. There have been no changes to the Group's capital management objectives, policies and processes in the year nor has
there been any change in what the Group considers to be its capital.
NOTE 37 OTHER EXPENSES
Bad debt and debt collection expenses
Communications
Insurance
Legal
Motor vehicle expenses
Travel and entertainment
Recruitment and Training
Additional NSW OSR Provision
Other
Total Other Expenses
84
Note
2017
$’000
471
2,709
1,182
2,124
3,242
2,716
2,423
2,500
12,938
30,305
Consolidated
2016
$’000
399
2,541
856
3,033
3,239
2,350
1,824
-
10,966
25,208
BSA LIMITED ANNUAL REPORT 2017
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2017
NOTE 38 CONTINGENT LIABILITIES
(i) Guarantees established in favour of National Australia Bank Limited and Swiss Re International SE for guarantees issued to various clients for satisfactory
contract performance, secured by cross guarantees from all wholly owned group members amounting to $42,670,000 (2016:$39,420,000).
(ii) On 27 June 2016 the Company received a certificate of finding under section 27J of the Industry Research and Development Act 1986 from
Innovation Australia. The certificate of finding outlines Innovation Australia’s view that none of the activities claimed in previous years by BSA
as Research and Development are “Core R&D activities” for the purpose of the Income Tax Assessment Acts.
BSA has filed a section 30C internal review of the section 27J finding.
In the event that BSA is unsuccessful in challenging the finding through appropriate mechanisms, the Company may be denied tax deductions
previously claimed totalling approximately $2 million (tax effected) of tax relating to prior years tax concessions claimed.
Based on expert advice the directors are of the opinion that the activities fall within the legislative requirements for R&D claims to be made
under the Income Tax Assessment Acts, that the documents submitted to Innovation Australia support and are consistent with the claims made
and that therefore BSA is in a defendable position against the Innovation Australia finding under s27J.
Accordingly, BSA has not made any provision in relation to this matter in these financial statements.
NOTE 39 CORPORATE INFORMATION
The Financial Report of BSA Limited for the year ended 30 June 2017 was authorised for issue in accordance with a resolution of the Directors on
28 August 2017 and covers the consolidated entity consisting of BSA Limited and its subsidiaries as required by the Corporations Act 2001. BSA
Limited is a company limited by shares incorporated in Australia and whose shares are publicly traded on the Australian Securities Exchange.
The financial report is presented in Australian currency.
The address of the registered office and principal place of business is:
Level 7, 3 Thomas Holt Drive
Macquarie Park NSW 2113
85
BSA LIMITED ANNUAL REPORT 2017
DIRECTORS’ DECLARATION
FOR THE YEAR ENDED 30 JUNE 2017
The Directors declare that:
(a)
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;
(b)
in the Directors’ opinion, the attached financial statements are in compliance with International Financial Reporting Standards, as
stated in note 3.1 to the financial statements;
(c)
In the Directors’ opinion, the attached financial statements and notes thereto are in accordance with the Corporations Act 2001,
including compliance with accounting standards and giving a true and fair view of the financial position and performance of the
consolidated entity; and
(d)
The Directors have been given the declarations required by s.295A of the Corporations Act 2001.
At the date of this declaration, the Company is within the class of companies affected by Corporations Legislative Instrument 2016/785.
The nature of the deed of cross guarantee is such that each company which is party to the deed guarantees to each creditor payment in
full of any debt in accordance with the deed of cross guarantee.
In the Directors’ opinion, there are reasonable grounds to believe that the Company and the companies to which the ASIC Class Order
applies, as detailed in note 19 to the financial statements will, as a group, be able to meet any obligations or liabilities to which they are, or
may become, subject by virtue of the deed of cross guarantee.
Signed in accordance with a resolution of the Directors made pursuant to s.295(5) of the Corporations Act 2001 (Cth).
On behalf of the Directors.
Michael Givoni
Chairman
Sydney
28 August 2017
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BSA LIMITED ANNUAL REPORT 2017
INDEPENDENT AUDITOR’S REPORT
Deloitte Touche Tohmatsu
A.C.N. 74 490 121 060
Grosvenor Place
225 George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1217 Australia
DX 10307SSE
Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2 9322 7001
www.deloitte.com.au
Independent Auditor’s Report to the members of BSA Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of BSA Limited (the “Company”) and its subsidiaries (the “Group”), which
comprises the consolidated statement of financial position as at 30 June 2017, the consolidated statement of
profit or loss and other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, notes to the financial statements, including a
summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001,
including:
(i)
giving a true and fair view of the Group’s financial position as at 30 June 2017 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial
report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s
report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report for the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited
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BSA LIMITED ANNUAL REPORT 2017 INDEPENDENT AUDITOR’S REPORT
Key Audit Matter
How the scope of our audit responded to the Key
Audit Matter
Recognition of revenue
Our procedures included, amongst others:
•
•
•
Refer to note 3.8 ‘Construction contracts and work in
progress’, note 4 ’Critical accounting judgements and
key sources of estimation uncertainty’, note 5
‘Revenue’, and note 29 ‘Segment Information’.
The Group's primary source of revenue is from
construction projects. Revenue is derived from a
number of contracts and recognised based on the stage
of completion of each contract. Stage of completion of
the construction work is determined with reference to
the work completed, i.e. the percentage of work
performed up to the reporting date with respect to the
total anticipated contract work to be performed. The
recognition of revenue is dependent on the following
key factors:
•
•
•
•
determination of stage of completion;
estimation of total contract revenue and
contract cost including the estimation of
cost contingencies;
determination of contractual entitlement
and assessment of the probability of
customer approval of variations and
acceptance of claims; and
estimation of project completion date.
We focused on revenue as a key audit matter due to
the number and type of estimation events over the
course of a contract life, and the unique nature of
individual contract conditions leading to complex and
judgemental revenue recognition from contracts.
-
-
Evaluating management’s processes and controls in
respect of the recognition of contract revenue. As
part of this process we tested key controls including:
the project review process conducted by
management at the tendering phase;
the preparation, management review and
authorisation of monthly contract status
reports for a sample of contracts;
the estimation and review of costs to
complete; and
project
the
management on a monthly basis.
undertaken by
reviews
-
-
Attending a sample of project review meetings to
enhance our understanding of
the Group’s
contracting processes, the consistency of their
application, and to discuss with project management
the key risks and opportunities in relation to
individual contracts.
Selecting a sample of contracts for testing using a
combination of quantitative and qualitative factors
which may indicate that a greater level of judgement
is required in recognising revenue including:
-
-
-
-
-
-
-
and
claims
unapproved
contract history;
significant
variations;
delay risk;
potential impact and likelihood of risk
events;
new contracts for which a material amount of
revenue was recognised during the financial
year;
high-value contracts; and
loss-making contracts.
•
For the sample of contracts selected, performing the
following procedures:
-
-
-
-
-
to
these
obtaining an understanding of the contract
terms and conditions and inspecting signed
contracts to evaluate whether contract terms
were reflected in management’s estimate of
forecast costs and revenue;
testing a sample of costs incurred to date and
supporting
agreeing
documentation;
assessing through enquiry of management
the current project status against the original
budget;
challenging the forecast costs to complete
through enquiry of project managers and
finance personnel in respect of a sample of
contracts, as well as inspection of supporting
documentation for contracted costs;
testing on a sample basis contractual
entitlement,
claims
variations
recognised in contract revenue through
agreement to supporting documentation and
and
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BSA LIMITED ANNUAL REPORT 2017 INDEPENDENT AUDITOR’S REPORT
-
-
contracts by understanding the contract
progress to date against contract terms;
evaluating on a sample basis significant
exposures to liquidated damages for late
delivery of contract works; and
evaluating contract performance
in the
period since year end to determine if any
adjustments to amounts recognised in the
year ended 30 June 2017 were required.
•
Assessing the appropriateness of the disclosures in
the financial statements.
Our procedures included, amongst others:
•
•
•
•
•
•
Evaluating management’s processes and controls in
respect of the collectability of trade receivables and
amounts due from customers under construction
contracts;
Assessing on a sample basis the aged debtor and
work in progress reports at year end and agreeing to
the subsequent receipt of cash;
Evaluating on a sample basis for the trade receivable
balances that were not collected prior to the issue of
the financial statements, the probability of recovery
of outstanding amounts by reference to the status of
contract negotiations, correspondence with the
customers, external and internal legal opinions,
historical
supporting
documentation;
recoveries
other
and
Testing on a sample basis that amounts due from
customers under construction contracts at year end
were subsequently billed to the customer;
For the amounts due
from customers under
construction contracts, amounts that were not billed
to the customer by the end of our audit, challenging
management’s assessment of the recoverability of
these amounts via
inquiry of management,
inspection of internal and external legal advice; and
Assessing the appropriateness of the disclosures in
the financial statements.
Collectability of trade receivables and amounts
due
construction
customers under
contracts
from
Refer to note 34 ‘Financial Instruments’ and note 14
‘Trade and other receivables’ and note 21 ‘Amounts
due from (to) customers under construction contracts’.
The Group recognises amounts due from customers
under construction contracts
in respect of the
progressive valuation of work completed as well as
trade receivables which represent amounts invoiced to
customers.
Credit risk and collectability of trade receivables are
subject to estimation and judgement and are required
to be monitored by management on an ongoing basis.
Amounts due from customers under construction
contracts (or work in progress) are amounts due to the
Group from customers that have not been invoiced.
Some of these project receivables are made up of
claims and variations, both approved and not approved
by the customer. Management assesses the likelihood
of recovery prior to recognising the amount due from
the customer.
We focused on this area as a key audit matter due to
the
the
judgement applied when determining
collectability of trade receivables and amounts due
from customers under construction contracts.
Litigation and claims
Our procedures included, amongst others:
Refer to note 25 ‘Provisions’ and note 38 ‘Contingent
Liabilities’.
• Obtaining the Group’s litigation reports and making
enquiries about the status of litigation matters with
Group management and external legal advisors.
The Group is party to legal proceedings brought by
third parties as a result of normal business operations.
Management have assessed each of these legal
matters and determined, with the assistance of
external legal counsel where relevant, whether there is
a requirement to provide for expected exposures or
disclose a contingent liability in the financial report.
•
•
We focused on this area as a key audit matter due to
the judgement applied when determining the likely
settlement of litigation and claims.
Reviewing minutes of meetings of those charged with
governance to identify their consideration of legal
relevant and correspondence
proceedings as
between the Group and its external legal advisors;
Assessing management’s determination of the
provisions recorded for potential litigation losses;
and
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BSA LIMITED ANNUAL REPORT 2017 INDEPENDENT AUDITOR’S REPORT
•
Assessing the appropriateness of the disclosures in
the financial statements.
Other Information
The directors are responsible for the other information. The other information comprises the information included
in the Group’s annual report for the year ended 30 June 2017, but does not include the financial report and our
auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not and will not
express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have
performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that
there is a material misstatement of this other information, we are required to report that fact. We have nothing
to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that gives a true
and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the Group or to cease operations, or have no realistic
alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance
with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Group’s internal control.
•
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However,
future events or conditions may cause the Group to cease to continue as a going concern.
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BSA LIMITED ANNUAL REPORT 2017 INDEPENDENT AUDITOR’S REPORT
•
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the
direction, supervision and performance of the Group audit. We remain solely responsible for our audit
opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may reasonably
be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included on pages 17 to 25 of the Directors’ Report for the year ended
30 June 2017.
In our opinion, the Remuneration Report of BSA Limited, for the year ended 30 June 2017, complies with section
300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the
Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
DELOITTE TOUCHE TOHMATSU
AG Collinson
Partner
Chartered Accountants
Sydney, 28 August 2017
91
91
BSA LIMITED ANNUAL REPORT 2017 SHAREHOLDER INFORMATION
THE SHAREHOLDER INFORMATION SET OUT BELOW WAS APPLICABLE AS AT 31 JULY 2017
A. DISTRIBUTION OF EQUITY SECURITIES
Analysis of numbers of equity security holders by size of holding:
Number of
Holders
Ordinary
Shares
Number of
Holders
Options
of Holders
Rights
Number
Performance
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and above
169
518
310
762
220
72,136
1,627,011
2,458,144
32,600,992
386,149,063
1,979
422,907,346
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1
2
3
-
-
-
90,322
1,316,667
1,406,989
There were 194 (2016: 283) holders of less than a marketable parcel of ordinary shares.
B. EQUITY SECURITY HOLDERS
Twenty largest quoted equity security holders
The names of the twenty largest holders of quoted equity securities are listed below:
Name of Holder
AUST EXECUTOR TRUSTEES LTD
BIRKETU PTY LTD
AET SFS PTY LTD
AET SFS PTY LTD
HGT INVESTMENTS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NATIONAL NOMINEES LIMITED
SANDHURST TRUSTEES LTD
SAMLOWE PTY LTD
BNP PARIBAS NOMS PTY LTD
MR GREG MULLANE
J P MORGAN NOMINEES AUSTRALIA LIMITED
FF OKRAM PTY LTD
NATIONAL NOMINEES LIMITED
EMELWIN PTY LTD
CITICORP NOMINEES PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD
AUST EXECUTOR TRUSTEES LTD
CTSF PTY LTD
EDINGTON PTY LIMITED
Top 20 Shareholders
92
Ordinary Shares
Number
Percentage
Held
of Issued
86,033,332
67,204,000
35,045,602
23,752,854
21,373,659
16,778,434
12,553,896
10,354,512
10,115,403
9,105,500
7,548,743
5,061,444
4,762,975
4,138,070
2,727,273
2,183,362
2,101,545
1,916,964
1,775,945
1,769,376
326,302,889
20.34%
15.89%
8.29%
5.62%
5.05%
3.97%
2.97%
2.45%
2.39%
2.15%
1.78%
1.20%
1.13%
0.98%
0.64%
0.52%
0.50%
0.45%
0.42%
0.42%
77.16%
BSA LIMITED ANNUAL REPORT 2017 SHAREHOLDER INFORMATION
THE SHAREHOLDER INFORMATION SET OUT BELOW WAS APPLICABLE AS AT 31 JULY 2017
C. SUBSTANTIAL SHAREHOLDERS
Substantial shareholders in the Company are set out below:
Ordinary Shares
AUST EXECUTOR TRUSTEES LTD
BIRKETU PTY LTD
NAOS ASSET MANAGEMENT LIMITED
HGT INVESTMENTS PTY LTD
D. VOTING RIGHTS
Number Held
Percentage
86,033,332
67,204,000
60,995,885
21,373,659
20.34%
15.89%
14.42%
5.05%
The voting rights attaching to each class of equity securities are set out below:
(a) Ordinary shares
On a show of hands every member present at a meeting in person, or by proxy, shall have one vote and upon a poll each share shall have one vote.
(b) Option over an ordinary share
No voting rights.
(c) Rights over an ordinary share
No voting rights.
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BSA LIMITED ANNUAL REPORT 2017 CORPORATE DIRECTORY
BSA Limited - Corporate
BSA | Build
Registered Office (Sydney)
Level 7, 3 Thomas Holt Drive
Macquaire Park NSW 2113
P
F
E
W
+61 2 8748 2400
+61 2 8748 2577
corporate@bsa.com.au
www.bsa.com.au
Head Office (Sydney)
Level 7, 3 Thomas Holt Drive
Macquaire Park NSW 2113
P
F
+61 2 9763 6200
+61 2 9763 6201
BSA | Connect
Head Office (Sydney)
Level 7, 3 Thomas Holt Drive
Macquaire Park NSW 2113
P
F
+61 2 8748 2400
+61 2 8748 2577
BSA | Maintain
Head Office (Sydney)
Level 7, 3 Thomas Holt Drive
Macquaire Park NSW 2113
P
F
+61 2 9763 6200
+61 2 9763 6201
Share Registry
Computershare Investor Services
GPO Box 2975
Melbourne VIC 3001 Australia
P
P
F
1300 85 05 05
+61 3 9415 4000
+61 3 9473 2500
Auditor
Deloitte Touche Tohmatsu
225 George Street
Sydney NSW 2000
Banker
National Australia Bank
255 George Street
Sydney NSW 2000
www.bsa.com.au
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BSA LIMITED ANNUAL REPORT 2017