dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
APPENDIX 4E - YEAR ENDED 30 JUNE 2021
dorsaVi Ltd and controlled entities
APPENDIX 4E
PRELIMINARY FINANCIAL REPORT
FOR THE YEAR ENDED
30 JUNE 2021
Provided to the ASX under listing rule 4.3A
ABN: 15 129 742 409
ASX CODE: DVL
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
APPENDIX 4E - YEAR ENDED 30 JUNE 2021
CONTENTS
Appendix 4E
Details of the reporting period and the previous corresponding period
Results for Announcement to the Market
Explanation of Results
Statement of Accumulated Losses
Details of entities over which control has been gained or lost during the period
Audit of the Financial Report
Attachment
Annual Report for the year ended 30 June 2021
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
APPENDIX 4E - YEAR ENDED 30 JUNE 2021
Details of the reporting period and the previous corresponding period
Reporting period:
Year ended 30 June 2021
Previous corresponding period:
Year ended 30 June 2020
Results for announcement to the market
June 2021
June 2020
Change
Change
($)
($)
($)
(%)
Revenue
2,779,633
2,397,059
382,574
16%
Loss from ordinary activities after tax attributable to
members
(2,028,267)
(7,593,079)
5,564,812
-73%
Loss for the period attributable to members
(2,028,267)
(7,593,079)
5,564,812
-73%
Net Tangible asset per share
Explanation of Results
June 2021
(cents)
June 2020
(cents)
Change
(cents)
0.62
0.20
0.42
The economies in which the Group operates continue to be impacted by the COVID-19 pandemic. The Group continues to be
focused on: protecting its people, maintaining and growing recurring revenue, and, controlling cost.
Total revenue for the 2021 financial year was $2,779,633 (2020: $2,397,059), an increase of 16%. Sales revenue was
$1,868,982 (2020: $2,019,220). Total revenue also included government grants, including Job Keeper payments, of $493,778
(2020: $250,276) and the change in the fair value of the derivative liability (included in the carrying value of the convertible note)
of $349,925 (2020: an expense of $278,151).
The loss from continuing operations after income tax for the 2021 financial year was $2,028,267 (2020: $7,593,079), a
decrease of 73% on the 2020 financial year.
Total expenditure was $5,225,730 for the 2021 financial year (2020: $10,447,502), a decrease of 50%.
The reduction of expenditure from the prior year was largely a result of: a reduction in depreciation and amortisation expense
from $1,039,365 in the prior year to $210,203 in the current year; a reduction in the provision for impairment of intangible assets
from $4,018,354 in the prior year to $Nil in the current year; and a reduction the change in fair value of the derivative liability
from $278,151 in the prior year as compared to revenue of $349,925 in the current year.
During the financial year there were no returns to shareholders in any form.
This report should be read in conjunction with any public announcements made by dorsaVi Ltd in accordance with the
continuous disclosure requirements arising under the Corporations Act 2001 and ASX Listing Rules.
The information provided in this report contains all the information required by ASX Listing Rule 4.3A.
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
APPENDIX 4E - YEAR ENDED 30 JUNE 2021
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Refer to the attached annual report
Consolidated Statement of Financial Position
Refer to the attached annual report
Consolidated Statement of Changes in Equity
Refer to the attached annual report
Consolidated Statement of Cash Flows
Refer to the attached annual report
Dividends
The board has declared no dividend for the years ended 30 June 2021 (2020: $Nil). There are no dividend reinvestment plans
in operation.
Statement of Accumulated Losses
Consolidated Entity
2021
$
2020
$
Balance at the beginning of year
(40,854,577)
(33,315,228)
Net loss attributable to members of the parent entity
Reversal of share-based payment reserve
Total available for appropriation
Dividends paid
Balance at end of year
(2,028,267)
111,683
(42,771,161)
(7,593,079)
53,730
(40,854,577)
-
-
(42,771,161)
(40,854,577)
Details of entities over which control has been gained or lost during the period
There was no gain or loss in control of entities during the year ended 30 June 2021.
Audit of the Financial Report
The financial report has been audited and an unqualified opinion has been issued with an Emphasis of Matter in relation to
Going Concern.
Date: 26 August 2021
Finance Disclosure Committee
dorsaVi Ltd
ANNUAL REPORT
2021
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
dorsaVi Ltd
(ABN: 15 129 742 409)
Annual Report
For the Year Ended 30 June 2021
CONTENTS
CHAIRMAN’S REVIEW
CEO REPORT
FINANCIAL REPORT
Financial Report
Directors’ Report
Auditor’s Independence Declaration
Financial Report for the Year Ended 30 June 2021
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report to the Members of dorsaVi Ltd
Shareholder Information
dorsaVi Annual Report 2021
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5
10
11
12
27
28
32
60
61
66
2
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CHAIRMAN’S REVIEW
Dear Shareholders
On behalf of the dorsaVi Board, it gives me great pleasure to present our FY21 Annual Report.
The year has been marked by several challenges born from the dynamic and unpredictable global pandemic. In what has
been a challenging year operationally, we are excited by the early signs of positive momentum building into a post-COVID
turnaround. We managed to maintain a resilient recurring revenue stream despite the challenging conditions and saw growth
in the third and fourth quarters, which was underpinned by the continued execution of our strategy to target large customers
in the robust Clinical market. We have continued to re-shape our business, with a core focus on generating recognised
recurring revenue while simultaneously focusing on our lean cost strategy. Running lean has given us the ability to invest in
our product, resulting in a market leading sensor design with secure data privacy that provides a platform to engage new
Clinical market customers.
It is reassuring to see our improved second half results, which represented an uplift in revenues coinciding with the COVID-
19 recovery and subsequent return to work in the US and UK. As these regions continue to return to work, we are confident
that dorsaVi’s recovery will continue accordingly, even as Australia faces the possibility of further lockdowns and an extended
COVID-19 recovery timeline. Our well diversified business across our key geographies has provided some protection to
localised lockdowns leading to a more stable business, which has been complemented by our ability to work from home. This
has been reflected by our CEO, Andrew Ronchi, who has moved back to Australia from the US to leverage his in-depth
knowledge of their Workplace and Clinical markets, to increase the local business profile. This move is made possible by the
3-year period Andrew spent in the US, developing our operations in the US and establishing robust relationships which can
now be maintained virtually. Andrew’s hard work has put us in a strong position to grow in the US and we look forward to him
replicating the success in Australia.
In terms of our clinical applications, we continue to transform the management of patients with digital health solutions which
provide objective assessment, remote monitoring and immediate biofeedback. The Clinical market has seen growth despite
COVID-19 related challenges. dorsaVi has been executing on its strategy to win large-scale customers, substantiated by the
ongoing partnership with Medtronic. We continue to deliver on our promise of creating shareholder value through partnerships
with large reputable institutions, which in turn allows dorsaVi’s products to be improved and validated in the eyes of the wider
clinical market. Importantly, our ongoing work with leading clinical institutions has led to optimised sensor technology, as these
organisations have stringent product requirements, leading to a product with enhanced data privacy and security features and
up-to-date technological advancements. Having a better product with features required by market leading companies provides
dorsaVi with added sales capabilities and greater potential to grow.
The Workplace market is primed for growth as people return to work and the COVID-19 recovery continues worldwide. dorsaVi
is positioned strongly to capitalise on this trend, which we aim to do through the execution of our channel partnership strategy
and enhanced product capabilities. The Company’s strategy to align with channel partners, such as QBE Australia, aims to
provide these customers with our market leading wearable sensor technology thereby lowering insurance premiums, driving
safer work environments, and gaining exposure to high-quality corporate customers. In the Workplace market, dorsaVi enables
employers to assess risk of injury for their employees as well as test the effectiveness and implement improvements to OH&S
workplace design, equipment or methods based on objective evidence. We are pleased to have advanced the Company’s
goal to improve workplace safety culture, which ultimately helps minimise injuries.
dorsaVi continues to pursue its lean management strategy by reducing our cost base through FY21. Running lean was initially
a response to COVID-19, but now forms an integral part of the Company’s strategy and has allowed for important investment
in R&D. By investing strategically in product development, dorsaVi has ensured it will continue to meet the advanced
compliance requirements of sophisticated customers, while simultaneously increasing the appeal of our products to win new
top tier customers.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Finally, on behalf of the Board, I would like to take this opportunity to thank CEO, Andrew Ronchi, my fellow Board directors,
and the entire dorsaVi team for their outstanding contribution.
We look forward to the coming year as we continue to assist patients in their recovery process and work towards our goal of
significantly reducing injuries in the workplace. With a strengthened product, increased marketability, US market coming back
to life and Andrew back in Australia to help drive local and international growth, the future looks promising for dorsaVi.
Yours sincerely
Greg Tweedly
Chairman
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
CEO REPORT
Introduction
This past year has taught us all how to re-think our work environments, as we have navigated through challenging and
complicated times due to the Coronavirus (COVID-19) pandemic. From the perspective of dorsaVi, this has brought new and
difficult obstacles to overcome, but has also presented us with growth opportunities and potential investment pathways.
Fortunately, the tide of lockdowns in some of our key markets (USA and UK) is turning and evidenced by our recent quarterly
results, there appears to be an increase in activity in both the Clinical and Workplace markets. I am eager for us to build on
our positive momentum by leveraging the ‘return to normal’ environment to sign new customers and drive growth.
The strategic foundations we have set over the last few years are underpinned by a focus on generating recurring revenue
through large customers in the Workplace and Clinical markets. Large clients are attractive to target given their bespoke
requirements and need for analytical insights. The scope of signing these customers requires a consulting style revenue early
in the agreement, followed by more predictable recurring revenues later. This structure typically results in larger contracts and
provides industry validation for our technology by demonstrating a proven ability to work with industry leaders. These benefits
illustrate what makes large-scale multinational customers so appealing and substantiate the Company’s decision to continue
to target leading organisations.
Given the uncertainty surrounding the current trading environment, and a large part of the working population not physically
going to work, we have adopted a lean strategy to ensure our operational spend reflects the current climate. This mindset has
enabled us to dynamically adjust to the challenges presented, leading us to decrease our expenses, while simultaneously
presenting us the chance to invest in necessary upgrades to ensure our product remains best in class. Further, we have made
inroads in product design which has led to material cost reductions in our sensor production which we aim to leverage in the
coming years.
We continue to focus on our channel partners in the insurance, medical device and the emergency services sectors and hope
to grow these relationships in the near future. I believe with an improved product complemented by a materially lower
production cost, established partnerships with market leaders and industry tailwinds supportive of back-to-work initiatives, we
are well positioned to capitalise on a return to normality.
Strategic overview
Our strategic focus is underpinned by core strategic pillars; a focus on recurring revenue, targeting large-scale customers,
running a lean operation, and optimising our product offering.
Focus on recurring revenue
Our strategy to transition away from a historical reliance on one-off consulting revenue, to the more reliable recognised
recurring revenue (RRR) model, is already proving prudent given how resilient our revenue profile has been. Our RRR in FY21
was $1.4m which was marginally lower than our FY20 RRR of $1.5m. Given the direct influence COVID-19 had on workplace
utilisation and the ability for patients to see practitioners in the lockdown periods, we believe this result provides a great
foundation for revenue growth as we move away from of a lockdown environment.
dorsaVi Annual Report 2021
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FIGURE 1: Recurring revenue over the last 5 years (A$’000)
1,600
1,400
1,200
1,000
800
600
400
200
0
329
293
355
304
FY19
373
340
396
395
Q4
Q3
Q2
Q1
386
356
346
333
FY20
FY21
176
148
140
178
FY17
247
214
213
180
FY18
Pleasingly, we achieved $742k in recurring revenue in the second half of FY21, up 9% from $679k in the first half of FY21 and
up 4% from $713k in the pcp. We believe these results are early signs of positive momentum which we hope will continue to
build as our key markets rebound out of COVID-19. The mix of recurring revenue against consulting revenue continues to
grow, and we expect this trend to continue with further product enhancements.
FIGURE 2: Recurring revenue as percentage of customer sales revenue
74%
76%
51%
19%
26%
FY17
FY18
FY19
FY20
FY21
Targeting large scale customers
Our strategic focus on targeting large scale customers in both the clinical and the workplace markets is starting to pay
dividends, as we have seen with Medtronic. Subsequent to the year end, we signed a third agreement with Medtronic. Across
the three agreements we have generated a combined revenue value of >US$570k ($760k AUD) with the majority of the
revenue to be recognised in FY22. Not only has this given us stable financial cash flow, but it has also provided us with industry
validation, as our products have been recognised by a sector leader. We aim to leverage off this confirmation to increase our
funnel of large-scale enterprises in both the clinical and workplace markets, and ultimately grow our recurring revenues and
average contract size.
Running a lean operation
Reflective of the current environment, and the size of our current operations, we have continued to optimise our cost structure
by employing a lean management strategy. To achieve this, we have been realising various operational efficiencies such as
reducing our office spend by transitioning our sales staff to work from home arrangements, optimising our technology stack to
reduce non-essential subscription costs, and customising our marketing strategy resulting in reduced overheads. These,
among other levers, have allowed us to decrease our operational expenditure. We are pleased to report our total expenses
dorsaVi Annual Report 2021
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ABN: 15 129 742 409
reduced from $6.4m in FY20 to $5.2m on a normalised basis (removing provision for impairment of intangibles from FY20),
which includes our added investment in new product development. We will continue to focus on our lean execution, and firmly
believe that our reductions are sustainable in the near term.
FIGURE 3: Total costs in FY20, FY21 (A$m)
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0.0
Employee
Other
D&A
Software
Advertising
Occupancy
Cost of sales
FY20
FY21
Product update
Our sensors and products are now better than ever due to strategic investment during the past 2 years. In line with our strategic
objectives, we have made important upgrades to the data privacy and security features of our sensors which are a necessary
pre-requisite for partnering with increasingly sophisticated companies. Many large-scale entities require their IT infrastructure
and any data capturing systems to have a high level of sophistication and data protection. The decision to make this investment
has proven wise as it has enabled us to present a point of difference versus our competitors. Further, ongoing work with these
larger institutions has given us early insight into specific industry trends and the associated areas for product enhancement
and optimisation. This has allowed us to design our sensors, software, apps, algorithms and our data platform to be what we
believe is best in class, with market leading and on-trend features.
Through our refinements, we have been able to substantially lower the unit cost of our product, with translational benefits in
other markets and sales channels that weren’t previously available. With a materially lower cost of production, we can now
look to explore various growth opportunities. One such opportunity could be a further push into the lucrative US market via
lower cost selling (direct online) channels, and a more flexible approach to contract negotiation, allowing for wider trial periods
of the product which can be recovered through a recurring revenue monthly contract. As this lower cost of production is
relatively recent, we look forward to exploring new ways to capitalise on the flexibility afforded to us by a lower cost of
production.
Overview of our key markets (Clinical and Workplace)
Clinical market
The Clinical market has remained robust despite COVID-19 related challenges. The promising developments in this market
has been predominantly driven by the need for sophisticated sensor technology, as our core client base of esteemed
physiotherapists (Physical Therapists in the US market) and medical researchers continues to evolve. dorsaVi has been well
placed to benefit from this trend, as not only is our technology highly regarded, but it can also be adjusted to fit more customised
requirements. Pleasingly, we have managed to maintain our revenue from the Clinical market in FY21 of $1.13m ($1.13m in
FY20) despite the challenges associated with our client base of physical therapists, who had reduced face-to-face client
engagements during COVID lockdowns. As more communities come out of lockdown, and people recommence their daily
activities, we expect increased organic growth in the Clinical space, coupled by further agreements with Medtronic and other
leading medical organisations.
As mentioned earlier, our lower product costs enable us to open new sales channels, which are more apparent in the Clinical
market. One such pathway is for dorsaVi to offer its products online, increasing the Company’s reach to general practitioners
and physiotherapists throughout the world. This material cost difference gives us confidence we can grow our practitioner
market share, with a market leading product at a significantly lower price point. The numerous industry tailwinds prevalent in
the clinical space highlight my confidence and enthusiasm for dorsaVi’s immediate future.
dorsaVi Annual Report 2021
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Workplace market
The Workplace market has been challenging over FY21 due to the lockdowns, resulting in customers in our key markets
working from home wherever possible. Fewer people going to work has a direct relationship to our revenue, as organisations
have less of a desire to invest in ergonomics and staff well-being if people are working from home. With that being said, we
have managed to record a FY21 $739k revenue result in the Workplace market ($894k in FY20). While on the surface our
revenue has fallen, our FY21 result has been materially impacted by the recent on-going lockdowns in Australia. We have
actively had to delay numerous projects (signed contracts) with institutional Australian clients as we have physically been
unable to travel interstate or gain access to their premises. This will remain an ongoing issue for us until Australia returns to
pre-COVID levels of activity.
Last year we commenced our channel partner strategy with insurance firm QBE Australia. This partnership allows us to provide
QBE’s customers with our world leading technology to help improve their health and safety outcomes, and ultimately reduce
insurance premiums. This initiative, in many cases, resulted in dorsaVi undertaking additional work for these clients. As people
return to work, we expect demand to increase through our channel partners, as there will be a greater need to ensure staff are
safe considering lengthy times away from the office and the risk of deconditioned people returning to physically demanding
work tasks.
Outlook and FY21 results
In what has been arguably our most challenging year operationally, it is satisfying to see our total revenue number of $2.8m
exceed last financial year’s result ($2.4m in FY20). While an element of this year’s top line number does include benefits from
both the Australian and United States governments, we believe these have supplemented income that we would have been
able to realise had it not been for the pandemic. Our total revenue from customers in FY21 of $1.9m was largely in line with
last year ($2.0m in FY20), which was underpinned by the strong performance and resilience of the clinical market, and our
client’s reliance on our products.
FIGURE 4: Revenue by key market (A$’000)
2,500
2,000
1,500
1,000
500
0
894
1,125
739
1,130
Workplace
Clinical
FY20
FY21
Further, our continued focus on lean execution has resulted in the Company reporting a materially stronger result than in
FY20. The total loss for the year was $2.0m, a dramatic $5.6m* improvement on FY20. Our diversified sales strategy across
different geographies has allowed us to manage the COVID-19 impact and associated risks. The need for a diversified
customer group is more paramount than ever, as each individual region can be thrown into lockdown at short notice. This has
been highlighted by the current situation we find ourselves in throughout Eastern Australia. Thankfully, our decreased activity
in Australia has been more than offset by the increased activity in both the UK and the US, with the latter being our largest
market.
*Note that $4.6m of the $5.6m was related to removing provision for impairment of intangibles
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dorsaVi Ltd and controlled entities
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Thank you for your support
I would like to thank the Board of dorsaVi for their continued help and guidance as we navigated through FY21. As a show of
character, and in line with last year, the Company’s non-executive directors accepted options in lieu of directors’ fees, which
highlights their alignment to creating long term value for the Company and their belief in its future. I would also like to extend
my thanks to both the Australian and United States governments, who helped provide us with a supportive footing in the height
of uncertainty. From a staffing perspective, I would like to thank Matt May who started with dorsaVi close to 7 years ago as
Head of Australian Sales and Operations and moved into a GM role with dorsaVi, while I was located in the US for the past 3
years. Matt has been a long serving teammate and friend for these years and is moving on from his role with dorsaVi. I’d like
to wish Matt the very best of luck in his future endeavours and thank him for his efforts.
Lastly, I would like to especially thank our shareholders for their continued support in what has been a year filled with challenge.
I firmly believe we have laid the foundations for growth. I wish you all a safe year ahead and hope to see us leverage the
favourable industry tailwinds into new clients, new contracts, and more growth.
Andrew Ronchi
Chief Executive Officer
dorsaVi Annual Report 2021
9
FINANCIAL REPORT
For the Year Ended 30 June 2021
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
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Financial Report
For the Year Ended 30 June 2021
TABLE OF CONTENTS
Financial Report
Directors’ Report
Auditor’s Independence Declaration
Financial Report for the Year Ended 30 June 2021
Consolidated Statement Of Profit Or Loss And Other Comprehensive Income
Consolidated Statement Of Financial Position
Consolidated Statement Of Changes In Equity
Consolidated Statement Of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Independent Auditor’s Report to the Members of dorsaVi Ltd
Shareholder Information
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12
27
28
28
29
30
31
32
60
61
66
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Directors’ Report
The directors present their report together with the financial report of the Group consisting of dorsaVi and the entities it
controlled, for the financial year ended 30 June 2021 and auditor’s report thereon.
Directors
The names of directors in office at any time during or since the end of the year are:
Name
Greg Tweedly
Ashraf Attia
Caroline Elliott
Michael Panaccio
Andrew Ronchi
Designation
Non-Executive Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Chief Executive Officer, Executive Director
Appointed
29 October 2013
14 July 2008
24 November 2017
16 May 2008
18 February 2008
The directors have been in office since the start of the year to the date of this report unless otherwise stated.
Principal Activities
The principal activity of dorsaVi Ltd and its controlled entities during the financial year was the development and sale of
innovative motion analysis technologies. These technologies are commercialised via license, sale or fixed fee consultancy.
There has been no significant change in the nature of these activities during the financial year.
Results
The consolidated loss from continuing operations, after income tax, attributable to the members of dorsaVi Ltd was
$2,028,267 (2020: $7,593,079).
Review of Operations
The Group consists of four entities:
1. dorsaVi Ltd;
2. dorsaVi Europe Ltd, a wholly owned subsidiary incorporated and domiciled in the UK;
3. dorsaVi USA, Inc., a wholly owned subsidiary incorporated and domiciled in the US; and
4. Australian Workplace Compliance Pty Ltd, a wholly owned subsidiary domiciled in Australia.
As at 30 June 2021, net assets of the Group were $2,163,173 (2020: $459,029).
Total revenue for the 2021 financial year was $2,779,633 (2020: $2,397,059). Sales revenue was $1,868,982 (2020:
$2,019,220). Total revenue also included government grants, including Job Keeper payments, of $493,778 (2020:
$250,276) and the change in the fair value of the derivative liability included in the carrying value of the convertible note of
$349,925 (2020: expense $278,151).
Clinical
Despite the ongoing impact of COVID – 19 on the broader economy, Clinical income was $1,130,045 for the 2021 financial
year (2020: $1,125,151).
Workplace
Workplace income, utilising ViSafe technology, was $738,937 for the 2021 financial year (2020: $894,069).
The COVID-19 pandemic has continued to significantly impact Workplace sales revenues in the year to 30 June 2021.
Expenditure
Total expenditure was $5,225,730 for the 2021 financial year (2020: $10,447,502).
The reduction of expenditure from the prior year was largely a result of: a reduction in depreciation and amortisation
expense from $1,039,365 in the prior year to $210,203 in the current year; a reduction in the provision for impairment of
intangible assets from $4,018,354 in the prior year to $Nil in the current year; and a reduction the change in fair value of the
derivative liability from $278,151 in the prior year as compared to revenue of $349,925 in the current year.
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The material business risks that are likely to have an effect on the financial prospects of the Group include:
▪ Over time, dorsaVi may be subjected to increased competition if potential competitors develop new technologies or
▪
make scientific or systems advances that compare with or compete with dorsaVi’s products.
In the medical sector (but not the Elite Sports or OHS sectors), sales and adoption rates of dorsaVi’s system are, in
part, likely to be influenced by the availability and level of reimbursement from government and/or insurance payers.
Whilst dorsaVi’s products already benefit from reimbursement in some circumstances, there is no guarantee that the
use of dorsaVi’s products will receive further reimbursement.
▪ General economic conditions, movements in interest and inflation rates and currency exchange rates may have an
adverse effect on dorsaVi’s activities, as well as on its ability to fund those activities. In particular, much of its future
income is expected to come from the US and European markets and therefore dorsaVi’s activities will be affected by
currency exchange fluctuations. The COVID-19 pandemic has significantly impacted economic conditions in the year to
30 June 2021 and is expected to continue to have an economic impact in the near future.
▪ dorsaVi is not currently profitable. Proceeds from the initial float and subsequent capital raisings were and are primarily
being used to fund, both, the commercial rollout of dorsaVi’s products and continued product development. There is no
guarantee that the commercial rollout will result in profitability for the Group. If the commercial roll out is slower or less
successful than planned, dorsaVi may need to raise additional capital in the future.
Significant Changes in the State of Affairs
The following changes in the state of affairs occurred during the period:
•
•
•
•
•
•
•
•
•
On 9 July 2020, dorsaVi Ltd announced the grant of 3,693,714 options to non-executive directors, in lieu of directors’
fees, at an exercise price of $0.016 per share and an expiry date of 7 July 2025. The impact of the grant of these
options was recognised in share based payments as at 30 June 2020.
On 13 October 2020, dorsaVi Ltd announced the grant of 1,412,303 options to non-executive directors, in lieu of
directors’ fees, at an exercise price of $0.049 per share and an expiry date of 7 October 2025.
On 30 October 2020, dorsaVi Ltd announced the placement, to institutional and sophisticated investors, of
57,856,881 fully paid ordinary shares at $0.032 per share raising $1,851,420 before issue costs.
On 20 November 2020, dorsaVi Ltd, pursuant to a 1 for 4 non-renounceable share purchase plan to eligible
shareholders (announced 22 October 2020), issued 9,353,245 fully paid ordinary shares at $0.032 per share raising
$299,304 before costs.
On 23 December 2020, dorsaVi Ltd issued 2,707,286 fully paid ordinary shares, at $Nil per share, to the Managing
Director in lieu of a reduction in cash wages and other entitlements of $75,804. This share issue was approved by
shareholders at the Annual General Meeting held on 27 November 2020.
On 13 January 2021, dorsaVi Ltd announced the grant of 1,171,178 options to non-executive directors, in lieu of
directors’ fees, at an exercise price of $0.061 per share and an expiry date of 8 January 2026.
On 2 February 2021, dorsaVi Ltd announced the completion of a shortfall placement, to professional and
sophisticated investors, and issued 48,503,636 fully paid ordinary shares at $0.032 per share raising $1,552,116
before costs. The terms and issue price of the shortfall placement were in accordance with the entitlement offer that
closed on 13 November 2020.
On 12 March 2021, dorsaVi Ltd announced the issue of 1,084,000 fully paid ordinary shares, at $Nil per share, to
employees, under the dorsaVi ESOP. The issue of these shares arose on the vesting of 1,084,000 performance rights
previously granted as a result of those employees meeting the performance conditions attached to the rights.
On 14 April 2021, dorsaVi Ltd announced the grant of 1,297,792 options to non-executive directors, in lieu of directors’
fees, at an exercise price of $0.063 per share and an expiry date of 8 April 2026.
After Balance Date Events
No matters or circumstances have arisen since the end of the financial year that have significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future
financial years with the exception of the following:
•
On 7 July 2021, dorsaVi Ltd announced the issue of 1,778,455 options to non-executive directors, in lieu of directors’
fees, at an exercise price of $0.041 per share and an expiry date of 5 July 2026. The impact of the grant of these
options was recognised in share based payments as at 30 June 2021.
Likely Developments
The following likely developments, in the business of the Group, are expected to influence its future financial results:
▪ The Group expects to increase, year on year, the annuity revenue proportion of total clinical and workplace revenue.
▪ The Group expects that product, released globally in recent years, will continue to support revenue growth.
dorsaVi Annual Report 2021
13
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Environmental Regulation
The Group’s operations are not subject to any significant environmental Commonwealth or State regulations or laws.
Dividend Paid, Recommended and Declared
No dividends were paid, declared or recommended since the start of the financial year.
Equity Instruments
There were no options over unissued ordinary shares granted to executives by dorsaVi Ltd during the financial year. During
the financial year, 1,000,000 performance rights were granted to executives and 1,084,000 vested into shares. Further
details regarding performance rights and shares granted as remuneration are provided in the Remuneration Report below.
There were 5,659,728 options over unissued ordinary shares granted to non-executive directors during or since the financial
year end in lieu of the payment of directors’ fees. Further details regarding options granted as remuneration are provided in
the Remuneration Report below.
Shares under Option
Unissued ordinary shares of dorsaVi Ltd under option at the date of this report are as follows:
Date Options Granted
Number of
Unissued Ordinary Shares under
Option
Exercise Price of
Options
Expiry Date of the
Options
15 May 2017
15 May 2017
15 May 2017
4 December 2019
4 December 2019
7 January 2020
7 April 2020
7 July 2020
7 October 2020
8 January 2021
8 April 2021
5 July 2021
500,000
55,000
24,166
1,280,488
1,116,703
1,846,856
4,801,827
3,693,714
1,412,303
1,171,178
1,297,792
1,778,455
18,978,482
$0.33
$0.33
$0.33
$0.084
$0.070
$0.034
$0.022
$0.016
$0.049
$0.061
$0.063
$0.041
15 May 2022
1 October 2022
1 October 2023
4 December 2024
4 December 2024
7 January 2025
7 April 2025
7 July 2025
7 October 2025
8 January 2026
8 April 2026
5 July 2026
No option holder has any right under the options to participate in any other share issue of the Group.
Shares Issued on Exercise of Options
To the date of this report, there have been no shares issued during or since the end of the year as a result of the exercise of
an option over unissued shares.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Shares Subject to Performance Rights
Unissued ordinary shares of dorsaVi Ltd subject to performance rights at the date of this report are as follows:
Date Performance Rights
Granted
18 September 2019
Number of Unissued Ordinary
Shares subject to Performance
Rights
200,000
200,000
Issue Price of Shares
-
Vesting Date of
Performance Rights
1 September 2022
A performance right holder does not have any right to participate in any other share issue of the Group until the performance
rights vest and are converted to ordinary shares.
Shares Issued on Vesting of Performance Rights
During the year ended 30 June 2021 and to the date of this report, 1,084,000 shares were allocated on the vesting of
1,084,000 performance rights. During the year ended 30 June 2021 and to the date of this report, 146,000 performance
rights lapsed. There remain 200,000 performance rights that do not convert to issued shares unless performance conditions
are met, and they vest.
Information on Directors and Company Secretary
Greg Tweedly, B. Com, CPA, GAICD – Non-executive Chairman
Greg Tweedly is Chairman of dorsaVi Ltd and serves on the Nomination and Remuneration Committee. He was appointed
to the Board on 29 October 2013.
Greg is a Director of Melbourne Health, Deputy Chair of Environment Protection Authority Victoria, Chair of the Personal
Injury Education Foundation and was a Director and CEO of the Victorian WorkCover Authority (WorkSafe) from 2003 to
2012. Prior to joining WorkSafe, Greg was an executive with the Transport Accident Commission from 1996 to 2002 in
various senior roles including Chief Operating Officer. He was formerly a Director of the Emergency Services and
Telecommunications Authority, Director of the Institute of Safety Compensation and Recovery Research, a Director of the
Personal Injury Education Foundation, a Director and Chair of the Victorian Trauma Foundation, Chair of the Heads of
Workers’ Compensation Authorities of Australia and New Zealand and Member of SafeWork Australia and its predecessor
organisation.
No other directorships of listed companies were held during the three years to 30 June 2021.
Ashraf Attia, PhD, FAICD – Non-executive Director
Ash Attia was appointed as a director of dorsaVi on 14 July 2008 and chairs the Nomination and Remuneration Committee
and serves on the Audit and Risk Committee.
Ash has had senior management experience in multinational operations for over 30 years within the medical devices,
biotechnology and diagnostics industries. He is currently Chief Executive Officer of Bionic Vision Technologies, a company
developing an implantable device to restore sight to the blind. Prior to Bionic Vision , Ash held the position of Vice President
of Asia Pacific, Middle East and Israel at TransMedics Inc, a company based in Boston, USA and has commercialized
a revolutionary system in the area of heart, lung and Liver organ transplants and preservation. He has held several senior
executive roles with global medical devices organizations and has special expertise in the areas of commercialization,
business development, clinical, regulatory, R&D, strategic marketing, sales and distribution management.
No other directorships of listed companies were held during the three years to 30 June 2021.
Michael Panaccio, BSc (Hons), MBA, PhD, FAICD – Non-executive Director
Michael Panaccio serves on the Audit and Risk Committee and the Nomination and Remuneration Committee. He was
appointed to the Board on 16 May 2008.
Michael is one of the founding directors of Starfish Ventures Pty Ltd, an Australian based venture capital manager. He was
formerly an Investment Manager with JAFCO Investment (Asia Pacific). Prior to joining JAFCO, Michael was Head of the
Department of Molecular Biology at the Victorian Institute of Animal Sciences. Michael has previously been a director of
numerous technology businesses in Australia and the US including ImpediMed Ltd, SIRTeX Medical Ltd, Protagonist
Therapeutic Inc and Energy Response Pty Ltd.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
No other Directorships of listed companies were held during the three years to 30 June 2021. Michael is also a director of
Starfish Ventures Pty Ltd.
Caroline Elliott, B. Ec, CA, GAICD – Non-executive Director
Caroline Elliott is chair of the Audit and Risk Committee and was appointed to the Board on 24 November 2017.
Caroline is currently a Director of the National Film and Sound Archive of Australia, St John’s Ambulance Australia (Vic) and
Wiltrust Nominees Pty Ltd. She has previously held non-executive director roles at Cell Therapies Pty Ltd, Peter MacCallum
Cancer Centre and the Public Transport Ombudsman Limited. She is currently the Chief Executive Officer at apparel
business, The Propel Group Pty Ltd, and was previously the CFO and Company Secretary at Optal Ltd.
No other directorships of listed companies were held during the three years to 30 June 2021.
Andrew Ronchi, B. App. Sci. (Physio), PhD (RMIT Eng), GAICD – Chief Executive Officer, Director
Andrew Ronchi was appointed to the Board on 18 February 2008.
Before co-founding dorsaVi, Andrew was a practising physiotherapist both at an AFL club and in private practice. He has
also been founding partner in two physiotherapy centres, the largest of these employing 28 staff (including 13
physiotherapists). Andrew completed a PhD in Computer and Systems Engineering, investigating the reliability and validity
of transducers for measuring lumbar spine movement. As CEO of dorsaVi Ltd, Andrew is responsible for all aspects of the
Group’s operations.
No other directorships of listed companies were held during the three years to 30 June 2021.
Brendan Case, MComLaw (Melb), BEc, CPA, Grad Dip App Fin, Dip FP, FCIS
Brendan Case has served as dorsaVi Ltd’s secretary since 29 October 2013 and has more than 20 years of company
secretarial, corporate governance and finance experience. He is a former Associate Company Secretary of National
Australia Bank Limited (NAB), former secretary of NAB’s Audit and Risk Committees and has held senior management roles
in risk management and regulatory affairs.
Directors’ Meetings
The number of meetings of the board of directors and of each board committee held during the financial year and the
numbers of meetings attended by each director were:
G Tweedly
A Attia
C Elliott
M Panaccio
A Ronchi
G Tweedly
A Attia
M Panaccio
Board of Directors
Audit and Risk Committee
Eligible to Attend
12
12
12
12
12
Attended
12
12
12
12
12
Eligible to Attend
-
2
2
2
-
Attended
-
2
2
2
-
Nomination and Remuneration Committee
Eligible to Attend
2
2
2
Attended
2
2
2
Directors’ Interest in Shares, Performance Rights or Options as at the date of this report.
Names of Holders
M Panaccio
A Ronchi
G Tweedly
A Attia
C Elliott
Ordinary Shares
102,875,786
17,103,889
1,018,911
576,898
462,963
Options
4,214,910
-
5,754,586
4,214,910
4,214,910
The directors have no interests in performance rights. As approved by shareholders at the 2019 and 2020 Annual General
Meetings (AGM), non-executive directors have been progressively granted 5,659,728 options over ordinary shares in
dorsaVi Ltd over the course of the year ended 30 June 2021 and up to the date of this report (2020: 12,739,588 options).
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
The details of each non-executive director’s entitlement to options granted and a summary of the related terms is included in
Table 5 of this report.
Indemnification and Insurance of Directors and Officers
The Group has insured its Directors, Secretary and executive officers for the financial year ended 30 June 2021. Under the
Group’s Directors and Officers Liability Insurance Policy, the Group cannot release to any third party or otherwise publish
details of the nature of the liabilities insured by the policy or the amount of the premium.
The Group also indemnifies every person who is or has been an officer of the Group against any liability (other than for legal
costs) incurred by that person as an officer of the Group where the Group requested the officer to accept appointment as
Director.
To the extent permitted by law and subject to the restrictions in section 199A and 199B of the Corporations Act 2001, the
Group indemnifies every person who is or has been an officer of the Group against reasonable legal costs incurred in
defending an action for a liability incurred by that person as an officer of the Group.
ASIC Instrument on Rounding of Amounts
In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, the amounts in the
directors’ report and in the financial statements have been rounded to the nearest dollar.
Indemnification and Insurance of Auditors
No indemnities have been given or insurance premiums paid during or since the end of the financial year for any auditors of
the Group.
Proceedings on behalf of the Group
No person has applied for leave of Court to bring proceedings on behalf of the Group.
Auditor’s Independence Declaration
A copy of the auditor’s independence declaration as required under section 307C of the Corporations Act 2001 in relation to
the audit for the financial year is provided with this report.
Non-audit Services
Non-audit services are approved by resolution of the audit committee and approval is provided in writing to the board of
directors. Non-audit services were provided by the auditors of entities in the consolidated group during the year, namely
Pitcher Partners (Melbourne), network firms of Pitcher Partners, and other non-related audit firms, as detailed below. The
directors are satisfied that the provision of the non-audit services during the year by the auditor is compatible with the
general standard of independence for auditors imposed by the Corporations Act 2001 for the following reasons:
▪ all non-audit services were subject to the corporate governance procedures adopted by dorsaVi Ltd and have been
reviewed and approved by the Audit Committee to ensure they do not impact on the integrity and objectivity of the
auditor; and
▪
the non-audit services provided do not undermine the general principles relating to auditor independence as set out in
APES 110 Code of Ethics for Professional Accountants (including Independence Standards), as they did not involve
reviewing or auditing the auditor’s own work, acting in a management or decision making capacity for dorsaVi Ltd or any
of its related entities, acting as an advocate for dorsaVi Ltd or any of its related entities, or jointly sharing risks and
rewards in relation to the operations or activities of dorsaVi Ltd or any of its related entities.
Amounts Paid and Payable to Pitcher Partners Melbourne for Non-audit Services:
Taxation and Other Compliance Services
Total Remuneration for Non-audit Services
2021
$
11,100
11,100
2020
$
14,901
14,901
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Remuneration Report (Audited)
The Directors present the Group’s 2021 Remuneration Report, which details the remuneration information for dorsaVi Ltd’s,
Directors and other Key Management Personnel (KMP).
A.
Details of the Key Management Personnel
Period of Responsibility
Position
Non-Executive Directors:
Greg Tweedly
Caroline Elliott
Ashraf Attia
Michael Panaccio
Executive Director:
Andrew Ronchi
Executives:
Matthew May
Damian Connellan
David Erikson
Joanna Goldin
Yasmine Pateras
Full Year
Full Year
Full Year
Full Year
Full Year
Chairman, Non-Executive Director
Independent, Non-Executive Director
Independent, Non-Executive Director
Non-Executive Director
Chief Executive Officer/Director
Full Year
Full Year
Resigned 22/10/2020
Full Year
Full Year
General Manager
Chief Financial Officer
Chief Technical Officer
Clinical Manager
Workplace Manager
B.
Remuneration Policies
Nomination and Remuneration Committee (N&RC)
The N&RC of the Board of Directors is responsible for making recommendations to the Board on the remuneration
arrangements for each Non-Executive Director, Executive Director/Chief Executive Officer (CEO) and each Executive
reporting to the CEO. The current members of the N&RC are: Ashraf Attia, Michael Panaccio and Greg Tweedly.
The N&RC assess the appropriateness of the nature and amount of remuneration of executives on a periodic basis by
reference to relevant employment market conditions with the overall objective of ensuring maximum stakeholder benefit from
the retention of high quality, high performing directors and executive team. In determining the level and composition of
executive remuneration, the N&RC may also engage external consultants to provide independent advice.
The primary responsibility of the N&RC is to review and recommend to the Board:
▪ Executive remuneration and incentive policies and practices;
▪ The Executive Director's total remuneration having regard to remuneration and incentive policies;
▪ The design and total proposed payments from any executive incentive plan and reviewing the performance hurdles for
any equity-based plan;
▪ The remuneration and related policies of Non-Executive Directors for serving on the board and any committee (both
individually and in total); and
▪ Any other responsibilities as determined by the N&RC or the Board from time to time.
Remuneration Strategy
The remuneration strategy of dorsaVi Ltd is designed to attract, motivate and retain Employees, Executives and Non-
Executive Directors in Australia, the United States and Europe by identifying and rewarding high performers and recognising
the contribution of each employee to the continued growth and success of the Group. To this end, the key objectives of the
Group’s reward framework are to:
▪ Align remuneration with the Group’s business strategy;
▪ Offer an attractive mix of remuneration benchmarked against the applicable market’s region and country practices;
▪ Provide strong linkage between individual and Group performance and rewards;
▪ Offer remuneration based on merit and individual skill matching the role requirements with their experience and
responsibilities;
▪ Align the interests of executives with shareholders and share the success of the Group with the employees; and
▪ Support the corporate mission statement, values and policies through the approach to recruiting, organizing and
managing people.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Remuneration Structure
In accordance with best practice corporate governance, the structure of the Non-Executive Directors and Executive
remuneration is separate and distinct.
Non-Executive Director Remuneration Structure
The ASX Listing Rules specify that an entity must not increase the total aggregate amount of remuneration of Non-Executive
Directors without the approval of holders of its ordinary securities.
The Board, and since its inception the N&RC, considers the level of remuneration required to attract and retain Non-
Executive Directors with the necessary skills and experience for the Group’s Board. This remuneration is reviewed with
regard to market practice and Non-Executive Directors’ duties and accountability.
The constitution provides that the Non-Executive Directors are entitled to remuneration for their services as determined by
the Board up to an aggregate limit of $500,000 (which may be increased with Shareholder approval). The Group has
previously obtained advice about remuneration levels for Directors of listed companies and, based on that advice, set the
following annual Non-Executive Directors’ fees:
▪ Chairman: $75,092 plus superannuation;
▪ Other Directors: $50,000 plus superannuation; and
▪ Further fees for acting as chairman of a committee: $5,000 plus superannuation per committee.
The Group determines the maximum amount for remuneration, including thresholds for share-based remuneration for
Executives, by resolution. The remuneration received by the Non-Executive Directors for the year ended 30 June 2021 is
detailed in Table 1 of this section of the report.
As approved at the 2020 AGM, Non-Executive Directors were, in lieu of the payment of directors’ fees, granted 5,659,728
options over ordinary shares. Refer table 5 below for details of the options granted.
Executive Remuneration Structure
The Group provides a remuneration package that incorporates both cash-based remuneration and share-based
remuneration. The contracts for service between the Group and Executives are on a continuing basis the terms of which are
not expected to change in the immediate future. Share-based remuneration is conditional upon continuing employment
thereby aligning Executives with shareholder interests.
Remuneration consists of the following key elements:
▪ Fixed remuneration (base salary and superannuation); and
▪ Variable remuneration – short term incentives (STI) in the form of an annual incentive plan and long-term equity
incentive (LTI). STI and LTI are currently only provided to KMP by way of share-based payments and include no cash
component.
Fixed Remuneration
Objective
Fixed remuneration is reviewed annually by the Board and N&RC. The process consists of a review of the Group and
individual performance, relevant comparative remuneration from external and internal sources and where appropriate,
external advice on policies and practices.
Structure
Executives are given the opportunity to receive their fixed remuneration in a variety of forms including cash and allowances
(such as motor vehicle allowance). It is intended that the manner of payment chosen will be optimal for the recipient without
creating undue cost for the Group.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Variable Remuneration – Short-Term Incentive (STI)
Objective
The key objective of the STI program is to link the achievement of the Group’s operational targets with the remuneration
received by the Executives charged with meeting those targets.
Structure
Any STI granted depend on the extent to which specific targets set at the beginning of the financial year or on appointment
are met. The Key Milestones or Key Performance Indicators (KPI’s) cover individual, team and organisational financial
measures of performance. Typically included are measures such as: Achieving sales/revenue targets and/or growth, and
meeting Group compliance requirements. These measures were chosen as they represent the key drivers for the short-term
success of dorsaVi.
The Group has predetermined benchmarks that must be met in order to trigger STI under the STI scheme. Either on an
annual or financial year basis, after consideration of performance against the Key Milestones or KPIs, the N&RC, in line with
their responsibilities determine the amount, if any, of the STI to be awarded to each Executive. This process usually occurs
within one month after the trigger date. Typically, STI awards are made under the Employee Share Ownership Plan (ESOP)
and are delivered in the form of share options or performance rights. Each option entitles the holder to one fully paid
ordinary share of dorsaVi Ltd at an exercise price to be determined in accordance with the ESOP or by determination by the
N&RC. Each performance right vested entitles the holder to one fully paid ordinary share of dorsaVi Ltd at $Nil price.
The annual STI available for executives across the Group are subject to the approval of the N&RC.
Variable Remuneration – Long-Term Incentive (LTI)
Objective
The objectives of providing long term incentives are: To motivate and retain key dorsaVi employees; to attract quality
employees; to create commonality of purpose between dorsaVi and its employees; to add wealth for all shareholders of the
Group through the motivation of dorsaVi’s employees; and by allowing dorsaVi’s employees to share in the rewards of the
success of dorsaVi through the acquisition of, or entitlements to, shares and options.
Structure
The Board offers LTIs to reward the performance of employees, which is in alignment with shareholders’ interests and the
long-term benefit of the Group. LTI awards are made under the Employee Share Ownership Plan (ESOP) and are delivered
in the form of share options, performance rights or loan for shares. Each option entitles the holder to one fully paid ordinary
share of dorsaVi Ltd at an exercise price to be determined in accordance with the ESOP or by determination by the N&RC.
Each performance right vested entitles the holder to one fully paid ordinary share of dorsaVi Ltd at $Nil price.
Where an LTI participant ceases employment prior to vesting in their award, the options and unvested performance rights
are forfeited unless the N&RC applies its discretion to allow vesting at or post cessation of employment in appropriate
circumstances.
Options and performance rights have been granted, under the ESOP. Refer Table 5 for details of options and performance
rights granted to Executives under the ESOP.
Employment Agreements
The Group has entered into employment agreements with all Executives, including the CEO. The Group may terminate an
Executive’s employment agreement by providing written notice or providing payment in lieu of the notice period (based on
the fixed component of the Executive’s remuneration). The Group may terminate the contract at any time without notice if
serious misconduct has occurred.
The notice periods for key management personnel are as follows:
Name
Andrew Ronchi
Matthew May
Damian Connellan
Joanna Goldin
Yasmine Pateras
Notice Period
5 months
3 months
3 months
1 month
1 month
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
CEO Remuneration
At the commencement of the 2021 financial year, Andrew Ronchi’s fixed remuneration was US$203,712, including medical
benefits insurance, plus director’s fees of A$5,000 per annum. Subsequent to the start of the 2021 financial year Andrew
Ronchi returned to Australia. In June 2021 he agreed to a fixed remuneration of A$190,000 plus superannuation. Upon
termination of Andrew Ronchi’s employment contract, he will be subject to a restraint of trade for a maximum of 12 months.
C.
Details of Key Management Personnel Remuneration
(a)
Non-Executive Directors’ Remuneration: Table 1
2021
Non-Executive Directors
G Tweedly
A Attia
C Elliott
M Panaccio (i)
Short-Term
Salary fees
$
Post-employment
Pension Plan
$
-
-
-
-
-
-
-
-
Share-based
payments
Options
$
60,072
44,000
44,000
44,000
TOTAL
$
60,072
44,000
44,000
44,000
-
-
192,072
192,072
Total performance
related
Options as %
of total
%
-
-
-
-
-
%
100%
100%
100%
100%
(i) Michael Panaccio provides his services via Starfish Ventures Pty Ltd.
2020
Non-Executive Directors
G Tweedly
A Attia
C Elliott
M Panaccio (i)
Short-Term
Salary fees
$
Post-employment
Pension Plan
$
Share-based
payments (ii)
Options
$
TOTAL
$
-
-
-
-
-
-
-
-
80,096
58,667
58,667
58,667
80,096
58,667
58,667
58,667
-
-
256,097
256,097
Total performance
related
Options as %
of total
%
-
-
-
-
-
%
100%
100%
100%
100%
(i)
(ii)
Michael Panaccio provides his services via Starfish Ventures Pty Ltd.
Includes fees for the period 1 March 2019 through 30 June 2019, subsequently approved by shareholders at the 2019 AGM.
(b)
Executives’ Remuneration: Table 2
2021
Executive Director:
A Ronchi (iii)
Executives:
D Connellan
D Erikson (iv)
J Goldin (iii)
M May
Y Pateras
Short-Term
Salary, fees
$
Other (i)
$
Post-
employment
Pension Plan
$
Share-based
payments
Equity (ii)
$
Total
Total
performance
related
Share based
payments as % of
total
$
%
%
195,240
7,938
12,469
75,804
291,451
26.0
26.0
69,996
67,598
141,158
198,462
81,532
753,986
-
-
-
-
-
7,938
-
-
5,479
-
3,648
33,000
18,854
7,746
44,548
-
-
112,452
69,996
76,725
174,158
217,316
89,278
918,924
-
4.8
18.9
-
-
12.2
-
4.8
18.9
-
-
12.2
(i) Other benefits include the payment of certain health insurance premiums in the US.
(ii) Share based payments comprise the grant of performance rights and shares, and, for accounting purposes, are valued the same as options.
(iii) Foreign currency amounts are converted into AUD at the average exchange rates applicable throughout the year.
(iv) Resigned 22 October 2020
dorsaVi Annual Report 2021
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ABN: 15 129 742 409
Short-Term
Post-
employment
Share-based
payments
Total
Total
performance
related
Share based
payments as % of
total
2020
Executive Director:
A Ronchi (iii)
Executives:
D Connellan
D Erikson
M May
Salary, fees
$
Other (i)
$
Pension Plan
$
Equity (ii)
$
$
%
285,473
31,996
5,000
30,356
352,825
8.6
71,205
188,009
210,128
754,815
-
-
-
31,996
-
17,861
19,962
42,823
19,091
14,737
2,690
66,874
90,296
220,607
232,780
896,508
21.1
6.7
1.2
7.5
%
8.6
21.1
6.7
1.2
7.5
(i) Other benefits include the payment of certain health insurance premiums in the US.
(ii) Share based payments comprise the grant of performance rights and shares, and, for accounting purposes, are valued the same as options.
(iii) Foreign currency amounts are converted into AUD at the average exchange rates applicable throughout the year.
D.
(a)
Relationship between Remuneration and Group Performance
Remuneration Not Dependent on Satisfaction of Performance Condition
The non-executive remuneration policy is not directly related to Group performance. The Board considers a remuneration
policy based on short-term returns may not be beneficial to the long-term creation of wealth by the Group for shareholders.
(b)
Remuneration Dependent on Satisfaction of Performance Condition
A portion of the Executive Remuneration is based on attainment of performance conditions. Performance-based
remuneration may include short-term and long-term incentive plans. Performance-based remuneration granted to key
management personnel has regard to Group performance over a twelve month to 3-year period.
Summary of the performance conditions for KMP with performance-linked equity instruments: Table 3
KMP
Andrew Ronchi
Matthew May
Damian Connellan
David Erikson
Joanna Goldin
Yasmine Pateras
Conditions for vesting of Options and Performance Rights
Key Milestones as determined by and at the discretion of the Board
Key Milestones as determined by and at the discretion of the Board
Key Milestones as determined by and at the discretion of the Board
Key Milestones as determined by and at the discretion of the Board
Key Milestones as determined by and at the discretion of the Board
Key Milestones as determined by and at the discretion of the Board
The conditions were selected to promote the creation of shareholder wealth during the period.
(c)
Consequences of Group’s Performance on Shareholder Wealth
Summary of Group Performance and Key Performance Indicators: Table 4
Company Performance
Revenue
% increase/(decrease)
Loss after tax
% (increase)/decrease
Change in share price
Dividend paid to shareholders
Return of capital
Total remuneration of KMP
Total performance based remuneration
2021
2,779,633
16%
2020
2,397,059
(26%)
2019
3,223,869
(27%)
2018
4,394,271
13%
2017
3,897,882
20%
(2,028,267)
(7,593,079)
(4,020,751)
(3,727,073)
(3,876,248)
73%
69%
-
-
1,110,996
112,452
(89%)
(68%)
-
-
1,152,605
66,874
(8%)
(58%)
-
-
1,543,180
142,567
4%
(59%)
-
-
2,433,653
369,702
26%
7%
-
-
2,182,038
290,885
dorsaVi Annual Report 2021
22
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
E.
(a)
Key Management Personnel’s Share-Based Compensation
Details of Compensation Equity
Table 5
2021
Grant Date (i), (ii)
Number
Granted
Non-Executive Directors:
G Tweedly:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
A Attia:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
C Elliott:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
M Panaccio:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
Executives:
A Ronchi:
400,486
349,261
577,625
1,501,824
1,155,249
441,713
366,299
405,898
556,231
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
Value per
unit at grant
date
$
0.026
0.026
0.026
0.010
0.029
0.034
0.041
0.037
0.027
0.026
0.026
0.026
0.010
0.029
0.034
0.041
0.037
0.027
0.026
0.026
0.026
0.010
0.029
0.034
0.041
0.037
0.027
0.026
0.026
0.026
0.010
0.029
0.034
0.041
0.037
0.027
Vested during
the year
Year in
which equity
may vest
400,486
349,261
577,625
1,501,824
1,155,249
441,713
366,299
405,898
556,231
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
293,334
255,814
423,077
1,100,001
846,155
323,530
268,293
297,298
407,408
2020
2020
2020
2020
2020
2021
2021
2021
2021
2020
2020
2020
2020
2020
2021
2021
2021
2021
2020
2020
2020
2020
2020
2021
2021
2021
2021
2020
2020
2020
2020
2020
2021
2021
2021
2021
Vest
%
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%
Terms and conditions for each grant
Lapsed/re-
moved
during the
year
Exercise
Price
Expiry Date
First
Exercise
Date
Last
Exercise
Date
$
0.084
0.070
0.034
0.022
0.016
0.049
0.061
0.063
0.041
0.084
0.070
0.034
0.022
0.016
0.049
0.061
0.063
0.041
0.084
0.070
0.034
0.022
0.016
0.049
0.061
0.063
0.041
0.084
0.070
0.034
0.022
0.016
0.049
0.061
0.063
0.041
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
23-Dec-20
2,707,286
0.037
2,707,286
2021
100%
M May:
5-Nov-14
20,000
0.27
-
2025
100%
-
-
-
N/A
0.40
5-Nov-24
N/A
N/A
N/A
N/A
D Erikson:
18-Sep-19
18-Sep-19
18-Sep-19
J Goldin
11-Mar-21
115,000
115,000
200,000
0.04
0.04
0.04
84,000
-
-
2021
2022
2023
73%
-
-
1,000,000
22,556,602
0.033
1,000,000
22,190,602
2021
100%
31,000
115,000
-
-
146,000
-
-
-
N/A
N/A
1-Sep-22
N/A
N/A
1-Sep-22
N/A
N/A
1-Sep-22
N/A
N/A
N/A
(i) The options granted to non-executive directors are in lieu of the payment of directors' fees.
(ii) The performance rights granted to executives are subject to performance and retention conditions.
dorsaVi Annual Report 2021
23
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
2020
Grant Date (i), (ii)
Number
Granted
Non-Executive Directors:
G Tweedly:
Vested during
the year
Year in
which equity
may vest
Terms and conditions for each grant
Lapsed/re-
moved during
the year
Exercise
Price
Expiry
Date
First
Exercise
Date
Last
Exercise
Date
Vest
%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Value per
unit at grant
date
$
0.026
0.026
0.026
0.010
0.029
0.026
0.026
0.026
0.010
0.029
0.026
0.026
0.026
0.010
0.029
0.026
0.026
0.026
0.010
0.029
400,486
349,261
577,625
1,501,824
1,155,249
293,334
255,814
423,077
1,100,001
846,155
293,334
255,814
423,077
1,100,001
846,155
293,334
255,814
423,077
1,100,001
846,155
400,486
349,261
577,625
1,501,824
1,155,249
293,334
255,814
423,077
1,100,001
846,155
293,334
255,814
423,077
1,100,001
846,155
293,334
255,814
423,077
1,100,001
846,155
150,000
450,000
0.45
0.45
63,000
450,000
20,000
125,000
200,000
0.27
0.31
0.31
100,000
70,000
115,000
115,000
200,000
200,000
1,071,071
15,555,659
0.04
0.04
0.04
0.04
0.04
0.04
0.01
-
75,750
200,000
100,000
68,250
-
-
-
200,000
1,071,071
14,967,659
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2020
2025
2020
2020
2020
2020
2021
2022
2023
2020
2020
42%
100%
87,000
-
100%
61%
100%
100%
98%
-
-
-
100%
100%
-
49,250
-
-
1,750
-
-
-
-
-
138,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
0.086
0.072
0.036
0.024
0.018
0.086
0.072
0.036
0.024
0.018
0.086
0.072
0.036
0.024
0.018
0.086
0.072
0.036
0.024
0.018
-
-
0.40
-
-
-
-
-
-
-
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
N/A
N/A
5-Nov-24
N/A
N/A
N/A
N/A
1-Oct-20
1-Oct-21
1-Sep-22
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
4-Dec-20
4-Dec-20
7-Jan-20
7-Apr-20
7-Jul-20
N/A
N/A
N/A
N/A
N/A
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
N/A
N/A
N/A
N/A
N/A
N/A
N/A
1-Oct-20
1-Oct-21
1-Sep-22
N/A
N/A
1-Oct-20
1-Oct-21
1-Sep-22
N/A
N/A
N/A
N/A
N/A
N/A
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
A Attia:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
C Elliott:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
M Panaccio:
28-Nov-19
28-Nov-19
7-Jan-20
7-Apr-20
7-Jul-20
Executives:
A Ronchi:
29-Nov-16
29-Nov-16
M May:
5-Nov-14
5-Jun-17
5-Jun-17
D Erikson:
18-Sep-19
18-Sep-19
18-Sep-19
18-Sep-19
18-Sep-19
D Connellan:
18-Sep-19
25-Jun-20
(i) The options granted to non-executive directors are in lieu of the payment of directors’ fees.
(ii) The performance rights granted to executives are subject to performance and retention conditions.
As at 30 June 2021, no options have been exercised and, accordingly, no shares have been issued as a result of options
previously vested.
F.
(a)
Key Management Personnel’s Equity Holdings
Number of Equity Holdings held by Key Management Personnel
As at 30 June 2021, no key management personnel held options, under the Group’s Employee Share Ownership Plan 2013.
The non-executive directors, as approved at the 2019 and 2020 AGMs, were granted 5,659,728 options over ordinary
shares in lieu of the payment of directors’ fees, refer table 5 above.
As at 30 June 2021, key management personnel held 200,000 performance rights under the Group’s Employee Share
Ownership Plan 2013, which, on vesting, convert to 200,000 ordinary shares of the Group. As at 30 June 2021, none of
these performance rights had vested and converted to shares.
dorsaVi Annual Report 2021
24
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(b)
Number of Shares held by Key Management Personnel (Consolidated)
The relevant interest of each key management personnel in the share capital of the Group as notified the ASX as at 30 June
2021 is as follows:
Table 7
2021
Balance 30
June 2020
Vested on
Achievement of KPI
Participation in
share Issue
Net Change
Other
Balance 30
June 2021
Non-Executive
Directors
A Attia
C Elliott
M Panaccio
M Panaccio
(relevant interest)
G Tweedly
Executive
Director
A Ronchi
Executives
D Connellan
D Erikson
J Goldin
M May
Y Pateras
461,518
370,370
101,749,921
-
-
-
115,380
92,593
1,055,865
70,000
-
-
-
-
576,898
462,963
102,805,786
-
70,000
815,129
-
203,782
-
1,018,911
13,803,027
2,707,286
593,576
17,103,889
1,971,071
168,250
-
470,750
-
119,880,036
-
84,000
1,000,000
-
-
3,791,286
492,768
-
-
-
- 20,000
(181,220)
-
(252,250)
51,030
-
2,553,964
2,463,839
-
1,051,030
470,750
20,000
126,044,066
G.
(a)
Loans to Key Management Personnel
Aggregate of Loans Made
There were no loans made to key management personnel during the 2021 financial year (2020: $Nil). There were no
outstanding loans to key management personnel as at 30 June 2021 (30 June 2020: $Nil).
H.
(a)
Other Transactions with Key Management Personnel
Transactions with Key Management Personnel of the Entity or its Parent and their Personally Related
Entities
During the year, dorsaVi Ltd did not enter into any transactions with key management personnel or their personally related
entities.
(b)
Transactions with Other Related Parties
During the year ended 30 June 2021, dorsaVi Ltd paid $Nil (2020: $Nil) to Starfish Ventures Pty Ltd on behalf of Michael
Panaccio for director’s fees. As approved by shareholders at the 2019 and 2020 AGMs, Non-Executive Directors were
granted options over ordinary shares in lieu of the payment of directors’ fees. During the year ended 30 June 2021, Starfish
Ventures Pty Ltd was granted 1,296,529 options (refer table 5) on behalf of Michael Panaccio (2020: 2,918,381).
dorsaVi Annual Report 2021
25
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
I.
Use of Remuneration Consultants
During the year the Board did not engage remuneration consultants.
J.
Voting and Comments made at the Group’s 2020 Annual General Meeting (AGM)
At the Group’s most recent AGM, resolution to adopt the prior year remuneration report was put to the vote and at least 75%
of ‘yes’ votes were cast for adoption of that report. No comments were made on the remuneration report that was
considered at the AGM.
-----------------------------------End of the Remuneration Report------------------------------------------
Signed in accordance with a resolution of the directors
Greg Tweedly
Chairman
Andrew Ronchi
Director and CEO
Melbourne
Date: 26 August 2021
Melbourne
Date: 26 August 2021
dorsaVi Annual Report 2021
26
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
AUDITOR’S INDEPENDENCE DECLARATION
To the Directors of dorsaVi Ltd
In relation to the independent audit for the year ended 30 June 2021, to the best of my knowledge and belief
there have been:
(i)
(ii)
No contraventions of the auditor independence requirements of the Corporations Act 2001; and
No contraventions of APES 110 Code of Ethics for Professional Accountants.
This declaration is in respect of dorsaVi Ltd and the entities it controlled during the year.
S SCHONBERG
Partner
26 August 2021
PITCHER PARTNERS
Melbourne
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
27
pitcher.com.au
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Financial Report for the Year Ended 30 June 2021
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2021
Revenue and other income:
Sales revenue
Change in fair value of derivative liability
Other income
Less: Expenses:
Cost of sales
Advertising expenses
Conference expenses
Consultancy expenses
Depreciation and amortisation expenses
Employee benefits expenses
Provision for impairment of intangibles
Finance costs
Change in fair value of derivative liability
Occupancy expenses
Professional fees
Software expenses
Travel expenses
Other expenses
Loss before income tax benefit
Income tax benefit
Loss from continuing operations
Notes
2021
$
2020
$
4
4
4
5
5
5
5
1,868,982
2,019,220
349,925
560,726
-
377,839
2,779,633
2,397,059
(166,328)
(139,241)
-
(372,593)
(210,203)
(96,967)
(212,323)
(83,460)
(55,644)
(1,039,647)
(2,862,227)
(3,040,365)
-
(274,154)
(4,018,354)
(167,451)
-
(49,939)
(461,308)
(314,539)
(16,717)
(358,481)
(278,151)
(100,084)
(486,184)
(291,562)
(141,929)
(435,381)
(5,225,730)
(10,447,502)
(2,446,097)
(8,050,443)
6
417,830
457,364
(2,028,267)
(7,593,079)
Other comprehensive income:
Items that may be reclassified subsequently to profit and loss:
Exchange differences on translation of foreign subsidiaries net of tax
Other comprehensive income for the year
Loss for the year
(21,784)
(21,784)
(2,050,051)
19,511
19,511
(7,573,568)
Loss per share for loss from continuing operations attributable to equity holders
of the parent entity:
Basic loss per share
Diluted loss per share
22
22
(0.68 cents)
(0.68 cents)
(3.49 cents)
(3.49 cents)
The above statement should be read in conjunction with the accompanying notes.
dorsaVi Annual Report 2021
28
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
FOR THE YEAR ENDED 30 JUNE 2021
Current assets
Cash and cash equivalents
Receivables
Inventories
Other assets
Total current assets
Non-current assets
Plant and equipment
Total non-current assets
Total assets
Current liabilities
Payables
Borrowings
Lease liability
Provisions
Total current liabilities
Non-current liabilities
Borrowings
Lease liability
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Reserves
Accumulated losses
Total equity
Notes
2021
$
2020
$
8
9
10
11
2,796,175
1,685,288
1,237,222
931,220
626,697
683,139
148,286
149,721
4,808,380
3,449,368
13
253,621
378,411
253,621
378,411
5,062,001
3,827,779
14
15
16
17
15
16
17
18
19
19
996,016
1,240,480
246,253
181,941
101,737
144,269
202,677
206,911
1,546,683
1,773,601
1,349,304
-
2,841
1,482,993
102,715
9,441
1,352,145
1,595,149
2,898,828
3,368,750
2,163,173
459,029
44,532,862
41,080,353
401,472
233,253
(42,771,161)
(40,854,577)
2,163,173
459,029
The above statement should be read in conjunction with the accompanying notes.
dorsaVi Annual Report 2021
29
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2021
Consolidated Entity
Share capital
Reserves
$
$
Accumulated
losses
$
Total Equity
$
Balance as at 1 July 2019
Loss for the year
40,381,715
-
(77,193)
(33,315,228)
- (7,593,079)
6,989,294
(7,593,079)
Exchange differences on translation
of foreign operations, net of tax
Total comprehensive income for the
year
Transactions with owners in their
capacity as owners:
Issue of shares
Cost of raising capital
Employee share ownership plan
Equity instruments lapsed
- 19,511
- 19,511
- 19,511
(7,593,079)
(7,573,568)
746,760
(48,122)
-
-
- 344,665
- (53,730)
290,935
698,638
- 746,760
- (48,122)
- 344,665
53,730
53,730
-
1,043,303
Balance as at 30 June 2020
41,080,353
233,253
(40,854,577)
459,029
Balance as at 1 July 2020
Loss for the year
Exchange differences on translation
of foreign operations, net of tax
Total comprehensive income for the
year
Transactions with owners in their
capacity as owners:
Issue of shares
Cost of raising capital
Employee share ownership plan
Equity instruments lapsed
41,080,353
-
233,253
(40,854,577)
- (2,028,267)
459,029
(2,028,267)
- (21,784)
- (21,784)
- (21,784)
(2,028,267)
(2,050,051)
3,702,840
(250,331)
-
-
- 301,686
- (111,683)
190,003
3,452,509
- 3,702,840
- (250,331)
- 301,686
111,683
111,683
-
3,754,195
Balance as at 30 June 2021
44,532,862
401,472
(42,771,161)
2,163,173
The above statement should be read in conjunction with the accompanying notes.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2021
Cash flow from operating activities
Receipts from customers
Payments to suppliers and employees
Interest paid
Grants and sundry income received
Interest received
Income tax refunded
Net cash used in operating activities
Cash flow from investing activities
Payment for plant and equipment
Payment for intangibles
Net cash used in investing activities
Cash flow from financing activities
Proceeds from share issue
Proceeds from convertible note issue
Cost of raising capital and issuing convertible note
Proceeds from borrowings
Repayment of borrowings
Payment of principal portion lease liability
Net cash provided by financing activities
Reconciliation of cash
Cash at beginning of the financial year
Net increase / (decrease) in cash held
Cash at end of the year
Notes
2021
$
2020
$
1,562,306
(4,684,478)
(141,348)
549,601
11,125
432,397
(2,270,397)
2,300,250
(5,331,856)
(104,844)
278,252
99,587
579,057
(2,179,554)
20 (b)
(51,829)
(33,584)
(85,413)
(4,073)
(784,729)
(788,802)
3,702,840
-
(250,331)
256,097
(96,662)
(145,247)
3,466,697
746,760
1,155,000
(105,872)
240,317
(34,970)
(114,010)
1,887,225
1,685,288
1,110,887
2,796,175
2,766,419
(1,081,131)
1,685,288
20 (a)
The above statement should be read in conjunction with the accompanying notes.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Notes to the Financial Statements
TABLE OF CONTENTS
NOTE 1:
NOTE 2:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS
NOTE 3:
FINANCIAL RISK MANAGEMENT
NOTE 4:
NOTE 5:
REVENUE FROM CONTRACTS WITH CUSTOMERS AND OTHER INCOME
LOSS FROM CONTINUING OPERATIONS
NOTE 6:
INCOME TAX
NOTE 7:
DIVIDENDS
NOTE 8:
CASH AND CASH EQUIVALENTS
NOTE 9:
RECEIVABLES
NOTE 10:
INVENTORIES
NOTE 11:
OTHER ASSETS
NOTE 12:
INTANGIBLE ASSETS
NOTE 13:
PLANT AND EQUIPMENT
NOTE 14:
PAYABLES
NOTE 15:
BORROWINGS
NOTE 16:
LEASE LIABILITY
NOTE 17:
PROVISIONS
NOTE 18:
SHARE CAPITAL
NOTE 19:
RESERVES AND ACCUMULATED LOSSES
NOTE 20:
CASH FLOW INFORMATION
NOTE 21:
COMMITMENTS AND CONTINGENCIES
NOTE 22:
LOSS PER SHARE
NOTE 23:
SHARE BASED PAYMENTS
NOTE 24:
SUBSIDIARIES AND RELATED PARTY DISCLOSURES
NOTE 25:
AUDITOR'S REMUNERATION
NOTE 26:
PARENT ENTITY INFORMATION
NOTE 27:
SEGMENT INFORMATION
NOTE 28:
SUBSEQUENT EVENTS
dorsaVi Annual Report 2021
33
40
41
44
44
45
45
45
45
46
46
46
47
49
49
50
50
50
51
52
53
54
54
57
57
58
58
59
32
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTES TO THE FINANCIAL STATEMENTS YEAR ENDED 30 JUNE 2021
NOTE 1:
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies adopted by the Group in the preparation and presentation of
the financial report. The accounting policies have been consistently applied, unless otherwise stated.
(a)
Basis of Preparation of the Financial Report
This financial report is a general purpose financial report that has been prepared in accordance with the Corporations Act
2001, Australian Accounting Standards, Interpretations and other applicable authoritative pronouncements of the Australian
Accounting Standards Board (AASB).
The financial report covers dorsaVi Ltd and controlled entities as a Group. dorsaVi Ltd is a company limited by shares,
incorporated and domiciled in Australia at: 86 Denmark Street, Kew, Victoria, 3101. dorsaVi Ltd is a for-profit entity for the
purpose of preparing the financial statements.
The financial report was authorised for issue by the directors on the date of the directors’ report.
Compliance with International Financial Reporting Standards:
The consolidated financial statements of dorsaVi Ltd also comply with the International Financial Reporting Standards
(IFRS) issued by the International Accounting Standards Board (IASB).
Historical Cost Convention:
The financial report has been prepared under the historical cost convention, as modified by revaluations to fair value for
certain classes of assets and liabilities as described in the accounting policies.
Significant Accounting Estimates and Judgements:
The preparation of the financial report requires the use of certain estimates and judgements in applying the entity’s
accounting policies. Those estimates and judgements significant to the financial report are disclosed in Note 2.
(b)
New and Revised Accounting Standards Effective at 30 June 2021
The Group has applied all new and revised Australian Accounting Standards that apply to annual reporting periods
beginning on or after 1 July 2020.
(c)
Going Concern
The financial report has been prepared on a going concern basis. The Group incurred a loss from ordinary activities after
income tax of $2,028,267 during the year ended 30 June 2021 (2020: $7,593,079). The group had a net increase in cash of
$1,110,887 (2020: decrease $1,081,131) after raising additional share capital of $3,702,840 before costs. As at 30 June
2021, the Group’s current assets exceed current liabilities by $3,261,697 (2020: $1,675,767).
COVID-19 had a detrimental effect on the ability to grow revenues during the 2021 financial year. Whilst the future duration
of COVID-19’s impact remains uncertain, the effect on sales revenue is considered to be temporary. COVID-19 has also
caused the Group to more aggressively reduce costs than would have otherwise been the case, and the Group has also
been the recipient of various COVID-19 government assistance packages.
In determining the basis for preparation of the financial report, the Directors have assessed the financial performance, future
operating plans, financial forecasts, existing financial position and additional funding opportunities potentially available to the
Group. The Directors believe there are reasonable grounds to expect the Group to be able to continue as a going concern
for at least 12 months from the date of issue of the financial report, which contemplates continuity of normal business
activities and the realisation of assets and the settlement of liabilities in the ordinary course of business. It is acknowledged
however that there are uncertainties associated with the forecast assumptions regarding the ability to maintain and grow
revenues, contain and further reduce costs, and the ability to obtain additional debt or equity funding if required.
As a result of the above, the Directors have concluded that the going concern basis is appropriate.
Given the circumstances detailed above, there exists a material uncertainty that may cast significant doubt on the ability of
the Group to continue as a going concern and therefore, whether it will be able to realise its assets and extinguish its
liabilities in the normal course of business, and at the amounts stated in the financial report.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(d)
Principles of Consolidation
The consolidated financial statements are those of the Group, comprising the financial statements of the parent entity and all
of the entities which the parent controls. The Group controls an entity when it is exposed, or has rights, to variable returns
from its involvement with the entity and has the ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are prepared for the same reporting period as the parent entity, using consistent
accounting policies. Adjustments are made to bring into line any dissimilar accounting policies, which may exist.
All inter-company balances and transactions, including any unrealised profits or losses have been eliminated on
consolidation. Subsidiaries are consolidated from the date on which control is established and are de-recognised from the
date that control ceases.
(e)
Revenue from contracts with customers
The Group derives revenue from the sale of wearable sensors and software. The devices, when used with Group software,
allow the accurate measurement of movement at a variety of different places on the human body or the activity of muscles.
Revenue from integrated sales of devices and software:
The Group’s contracts with customers are typically integrated and requires the provision of devices and software which is
not separately identifiable and so is considered a bundle of goods and services. Revenue from the sale or lease of devices
and licencing of software is recognised over the licence term.
Revenue from consulting:
Revenue from consulting contracts is recognised over time, as the services are provided to the customer, based on service
hours performed as a percentage of estimated total service hours under the contract. Recognising revenue on the basis of
service hours is considered an appropriate method of recognising revenue as it is consistent with the manner in which
services are provided to the customer.
Revenue from the sale of consumables:
The Group sells various consumables goods to customers to support their ongoing use of their wearable sensors. Revenue
from the consumables is recognised at the point in time when control of the goods is transferred to the customer, which
generally occurs at the time of delivery. Customers are, either, required to pay in full for all goods received at the time of
purchase, or, are invoiced on a monthly basis depending on the contract. Outstanding invoices are due for payment within
30 days of the invoice date.
Consideration included in the measurement of revenue:
The consideration to be received from customers is generally fixed and based on the customer contract.
Receivables from contracts with customers:
A receivable from a contract with a customer represents the Group’s unconditional right to consideration arising from the
transfer of goods or services to the customer (i.e. only the passage of time is required before payment of the consideration is
due). Subsequent to initial recognition, receivables from contracts with customers are measured at amortised cost and are
tested for impairment.
Contract assets:
A contract asset represents the Group’s right to consideration (not being an unconditional right recognised as a receivable)
in exchange for goods or services transferred to the customer. Contract assets are measured at the amount of
consideration that the Group expects to be entitled in exchange for goods or services transferred to the customer.
Contract liabilities:
A contract liability represents the Group’s obligation to transfer goods or services to the customer for which the company has
received consideration (or an amount of consideration is due) from the customer. Amounts recorded as contract liabilities
are subsequently recognised as revenue when the Group transfers the contracted goods or services to the customer.
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(f)
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and at banks, short-term deposits with an original maturity of three months
or less held at call with financial institutions, and bank overdrafts. Bank overdrafts are shown within borrowings in current
liabilities on the statement of financial position.
(g)
Inventories
Inventories are measured at the lower of cost and net realisable value. Cost comprises all costs of purchase, cost of
conversion and other costs incurred in bringing inventories to their present location and condition.
(h)
Plant and Equipment
Each class of plant and equipment is carried at cost less, where applicable, any accumulated depreciation and any
accumulated impairment loss.
Depreciation:
The depreciable amount of all fixed assets is depreciated over their estimated useful lives commencing from the time the
asset is held ready for use.
Class of Fixed Asset
Testing equipment
Leased devices
Office equipment
Furniture, fixtures and fittings
Right to use asset
Tooling
(i)
Leases
Lease assets:
Depreciation Rates
10-50%
20%
10-67%
10-20%
31%
10%
Depreciation Basis
Diminishing value
Straight line
Diminishing value
Diminishing value
Straight line
Straight line
At the commencement date of a lease (other than leases of 12-months or less and leases of low value assets), the company
recognises a lease asset representing its right to use the underlying asset and a lease liability representing its obligation to
make lease payments.
Lease assets are initially recognised at cost, comprising the amount of the initial measurement of the lease liability, any
lease payments made at or before the commencement date of the lease, less any lease incentives received, any initial direct
costs incurred by the company, and an estimate of costs to be incurred by the company in dismantling and removing the
underlying asset, restoring the site on which it is located or restoring the underlying asset to the condition required by the
terms and conditions of the lease, unless those costs are incurred to produce inventories.
Subsequent to initial recognition, lease assets are measured at cost (adjusted for any remeasurement of the lease liability),
less accumulated depreciation and any accumulated impairment loss.
Lease assets are depreciated over the shorter of the lease term and the estimated useful life of the underlying asset,
consistent with the estimated consumption of the economic benefits embodied in the underlying asset.
Lease liabilities:
At the commencement date of a lease (other than leases of 12-months or less and leases of low value assets), the company
recognises a lease asset representing its right to use the underlying asset and a lease liability representing its obligation to
make lease payments.
Lease liabilities are initially recognised at the present value of the future lease payments (i.e. the lease payments that are
unpaid at the commencement date of the lease). These lease payments are discounted using the interest rate implicit in the
lease, if that rate can be readily determined, or otherwise using the company’s incremental borrowing rate.
Subsequent to initial recognition, lease liabilities are measured at the present value of remaining lease payments (i.e. the
lease payments that are unpaid at the reporting date). Interest expense on lease liabilities is recognised in profit or loss
(presented as a component of finance costs). Lease liabilities are remeasured to reflect changes to lease terms, changes to
lease payments and any lease modifications not accounted for as separate leases.
Variable lease payments not included in the measurement of lease liabilities are recognised as an expense when incurred.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Leases of 12-months or less and leases of low value assets:
Lease payments made in relation to leases of 12-months or less and leases of low value assets (for which a lease asset and
a lease liability has not been recognised) are recognised as an expense on a straight-line basis over the lease term.
(j)
Intangibles
Patents:
Patents, trademarks and licenses are recognised at cost and depreciated on a straight-line basis over their effective lives,
which is estimated to be 10 and 20 years.
Research:
Expenditure on research activities is recognised as an expense when incurred.
Development Expenditure:
Development expenditure encompasses the cost of developing new products including mobile applications, algorithms,
sensors, hardware and firmware. Development expenditure is capitalised when the entity can demonstrate all of the
following: the technical feasibility of completing the asset so that it will be available for use or sale; the intention to complete
the asset and use or sell it; the ability to use or sell the asset; how the asset will generate probable future economic benefits;
the availability of adequate technical, financial and other resources to complete the development and to use or sell the
asset; and the ability to measure reliably the expenditure attributable to the asset during its development. Capitalised
development expenditure is carried at cost less any accumulated amortisation and any accumulated impairment losses.
Amortisation is calculated using a straight-line method to allocate the cost of the intangible asset over its estimated useful
life, which range from 5 to 10 years. Amortisation commences when the intangible asset is available for use.
Other development expenditure is recognised as an expense when incurred.
(k)
Impairment of Non-Financial Assets
Intangible assets not yet ready for use and intangible assets with indefinite useful lives are not subject to amortisation and
are therefore tested annually for impairment, or more frequently if events or changes in circumstances indicate that they
might be impaired.
For impairment assessment purposes, assets are generally grouped at the lowest levels for which there are largely
independent cash flows - Cash Generating Units (CGU). Accordingly, most assets are tested for impairment at the cash-
generating unit level.
Intangible assets not yet ready for use and intangible assets with indefinite useful lives are assessed for impairment
whenever events or circumstances arise that indicate the asset may be impaired.
An impairment loss is recognised when the carrying amount of an asset or CGU exceeds the asset’s or CGU’s recoverable
amount. The recoverable amount of an asset or CGU is defined as the higher of its fair value less costs to sell and value in
use. Refer to Note 2 for a description of how management determines value in use.
Impairment losses in respect of individual assets are recognised immediately in profit or loss unless the asset is carried at a
revalued amount in which case the impairment loss is treated as a revaluation decrease in accordance with the applicable
Standard. Impairment losses in respect of CGU’s are allocated first against the carrying amount of any goodwill attributed to
the CGU with any remaining impairment loss allocated on a pro rata basis to the other assets comprising the relevant CGU.
(l)
Income Tax
Current income tax benefit is the tax receivable on the current period's taxable income based on the applicable income tax
rate adjusted by changes in deferred tax assets and liabilities. Current income tax benefit incudes refundable research and
development tax offsets.
Deferred tax assets and liabilities are recognised for temporary differences at the applicable tax rates when the assets are
expected to be recovered or liabilities settled. Deferred tax liabilities are not recognised if they arise from the initial
recognition of goodwill. Deferred income tax is also not accounted for if it arises from initial recognition of an asset or liability
in a transaction, other than a business combination, that at the time of the transaction affects neither accounting nor taxable
profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
Tax Consolidation:
dorsaVi Ltd (parent entity) and its wholly owned subsidiary, Australian Workplace Compliance Pty Ltd, have applied tax
consolidation legislation and formed a tax-consolidated group from 1 July 2014. The parent entity and subsidiary in the tax-
consolidated group have entered into a tax funding agreement such that each entity in the tax-consolidated group
recognises the assets, liabilities, expenses and revenues in relation to its own transactions, events and balances only. This
means that:
▪ The parent entity recognises all current and deferred tax amounts relating to its own transactions, events and balances
only;
▪ The subsidiary recognises current or deferred tax amounts arising in respect of their own transactions, events and
balances;
▪ Current tax liabilities and deferred tax assets arising in respect of tax losses, are transferred from the subsidiary to the
head entity as inter-company payables or receivables.
The tax-consolidated group also has a tax sharing agreement in place to limit the liability of the subsidiary in the tax-
consolidated group arising under the joint and several liability requirements of the tax consolidation system, in the event of
default by the parent entity to meet its payment obligations.
(m)
Employee Benefits
(i)
Short-Term Employee Benefit Obligations:
Liabilities arising in respect of wages and salaries, annual leave and any other employee benefits expected to be settled
within twelve months of the reporting date are measured at the amounts based on remuneration rates which are expected to
be paid when the liability is settled. The expected cost of short-term employee benefits in the form of compensated
absences such as annual leave is recognised in the provision for employee benefits. All other short-term employee benefit
obligations are presented as payables.
(ii)
Long-Term Employee Benefit Obligations:
The provision for employee benefits in respect of long service leave and annual leave which, are not expected to be settled
within twelve months of the reporting date, are measured at the present value of the estimated future cash outflow to be
made in respect of services provided by employees up to the reporting date.
Employee benefit obligations are presented as current liabilities in the balance sheet if the entity does not have an
unconditional right to defer settlement for at least twelve months after the reporting date, regardless of when the actual
settlement is expected to occur.
(iii)
Retirement Benefit Obligations:
The Group makes contributions to defined contribution superannuation plans in respect of employee services rendered
during the year. These superannuation contributions are recognised as an expense in the same period when the employee
services are received.
(iv)
Share-Based Payments:
The Group operates share-based payment employee share and option schemes. The fair value of the equity to which
employees become entitled is measured at grant date and recognised as an expense over the vesting period, with a
corresponding increase to an equity account. In respect of share-based payments that are dependent on the satisfaction of
performance conditions, the number of shares and options expected to vest is reviewed and adjusted at each reporting date.
The amount recognised for services received as consideration for these equity instruments granted is adjusted to reflect the
best estimate of the number of equity instruments that eventually vest.
(v)
Bonus Plan:
The Group recognises a provision when a bonus is payable in accordance with the employee’s contract of employment and
the amount can be reliably measured.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(n)
Borrowing Costs
Borrowing costs include interest expense calculated using the effective interest method, finance charges in respect of
leases, and exchange differences arising from foreign currency borrowings to the extent that they are regarded as an
adjustment to interest costs. Borrowing costs are expensed as incurred.
(o)
Financial Instruments
Initial recognition and measurement:
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions of the
instrument. For financial assets, this is equivalent to the date that the Group commits itself to either the purchase or sale of
the asset.
Financial instruments are initially measured at fair value adjusted for transaction costs, except where the instrument is
classified as fair value through profit or loss, in which case transaction costs are immediately recognised as expenses in
profit or loss.
Classification of financial assets:
Financial assets recognised by the Group are subsequently measured in their entirety at either amortised cost or fair value,
subject to their classification and whether the Group irrevocably designates the financial asset on initial recognition at fair
value through other comprehensive income (FVtOCI) in accordance with the relevant criteria in AASB 9.
Financial assets not irrevocably designated on initial recognition at FVtOCI are classified as subsequently measured at
amortised cost, FVtOCI or fair value through profit or loss (FVtPL) on the basis of both:
the Group’s business model for managing the financial assets; and
(a)
the contractual cash flow characteristics of the financial asset.
(b)
Classification of financial liabilities:
Financial liabilities classified as held-for-trading, contingent consideration payable by the Group for the acquisition of a
business, and financial liabilities designated at FVtPL, are subsequently measured at fair value.
All other financial liabilities recognised by the Group are subsequently measured at amortised cost.
Trade and other receivables:
Trade and other receivables arise from the Group’s transactions with its customers and are normally settled within 30 days.
Consistent with both the Group’s business model for managing the financial assets and the contractual cash flow
characteristics of the assets, trade and other receivables are subsequently measured at amortised cost.
Impairment of financial assets:
The following financial assets are tested for impairment by applying the ‘expected credit loss’ impairment model:
(a)
(b)
(c)
debt instruments measured at amortised cost;
debt instruments classified at fair value through other comprehensive income; and
receivables from contracts with customers and contract assets.
The Group applies the simplified approach under AASB 9 to measuring the allowance for credit losses for both receivables
from contracts with customers and contract assets. Under the AASB 9 simplified approach, the Group determines the
allowance for credit losses for receivables from contracts with customers and contract assets on the basis of the lifetime
expected credit losses of the financial asset. Lifetime expected credit losses represent the expected credit losses that are
expected to result from default events over the expected life of the financial asset.
For all other financial assets subject to impairment testing, when there has been a significant increase in credit risk since the
initial recognition of the financial asset, the allowance for credit losses is recognised on the basis of the lifetime expected
credit losses. When there has not been an increase in credit risk since initial recognition, the allowance for credit losses is
recognised on the basis of 12-month expected credit losses. ’12-month expected credit losses’ is the portion of lifetime
expected credit losses that represent the expected credit losses that result from default events on a financial instrument that
are possible within the 12 months after the reporting date.
The Group consider a range of information when assessing whether the credit risk has increased significantly since initial
recognition. This includes such factors as the identification of significant changes in external market indicators of credit risk,
significant adverse changes in the financial performance or financial position of the counterparty, significant changes in the
value of collateral, and past due information.
dorsaVi Annual Report 2021
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dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
The Group assumes that the credit risk on a financial asset has not increased significantly since initial recognition when the
financial asset is determined to have a low credit risk at the reporting date. The Group considers a financial asset to have a
low credit risk when the counterparty has an external ‘investment grade’ credit rating (if available) of BBB or higher, or
otherwise is assessed by the Group to have a strong financial position and no history of past due amounts from previous
transactions with the Group.
The Group determines expected credit losses using a provision matrix based on the Group’s historical credit loss
experience, adjusted for factors that are specific to the financial asset as well as current and future expected economic
conditions relevant to the financial asset. When material, the time value of money is incorporated into the measurement of
expected credit losses. There has been no change in the estimation techniques or significant assumptions made during the
reporting period.
The Group has identified expected credit loss rates for the purpose of measuring expected credit losses. These credit loss
rates have been selected based on the Group’s historical experience. Because contract assets are directly related to
unbilled work in progress, contract assets have a similar credit risk profile to receivables from contracts with customers.
Accordingly, the Group applies the same approach to measuring expected credit losses of receivables from contracts with
customers as it does to measuring impairment losses on contract assets.
The measurement of expected credit losses reflects the Group’s ‘expected rate of loss’, which is a product of the probability
of default and the loss given default, and its ‘exposure at default’, which is typically the carrying amount of the relevant
asset. Expected credit losses are measured as the difference between all contractual cash flows due and all contractual
cash flows expected based on the Group’s exposure at default, discounted at the financial asset’s original effective interest
rate.
Financial assets are regarded as ‘credit-impaired’ when one or more events have occurred that have a detrimental impact
on the estimated future cash flows of the financial asset. Indicators that a financial asset is ‘credit-impaired’ include
observable data about the following:
(a)
(b)
(c)
significant financial difficulty of the issuer or the borrower;
breach of contract;
the lender, for economic or contractual reasons relating to the borrower’s financial difficulty, has granted
concessions to the borrower that the lender would not otherwise consider; or
it is becoming probable that the borrower will enter bankruptcy or other financial reorganisation.
(d)
The gross carrying amount of a financial asset is written off (i.e. reduced directly) when the counterparty is in severe
financial difficulty and the Group has no realistic expectation of recovery of the financial asset. Financial assets written off
remain subject to enforcement action by the Group. Recoveries, if any, are recognised in profit or loss.
(p)
Foreign Currency Translations and Balances
Functional and Presentation Currency:
The financial statements of each entity within the Group are measured using the currency of the primary economic
environment in which that entity operates (the functional currency). The consolidated financial statements are presented in
Australian dollars which is the Group’s functional and presentation currency.
Transactions and Balances:
Transactions undertaken in foreign currencies are recognised in the Group’s functional currency at the rate of exchange
ruling at the date of the transaction.
Foreign currency monetary items that are outstanding at the reporting date (other than monetary items arising under foreign
currency contracts where the exchange rate for that monetary item is fixed in the contract) are translated using the spot rate
at the end of the financial year.
Except for certain foreign currency hedges, all resulting exchange differences arising on settlement or re-statement are
recognised as revenues and expenses in the financial year in which they arose.
Foreign Subsidiaries:
Entities that have a functional currency different to the presentation currency are translated as follows:
▪ Assets and liabilities are translated at the closing rate on reporting date;
▪
Income and expenses are translated at actual exchange rates or average exchange rates for the period, where
appropriate; and
▪ All resulting exchange differences are recognised in other comprehensive income.
dorsaVi Annual Report 2021
39
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(q)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the Tax Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the
asset or as part of an item of the expense. Receivables and payables in the statement of financial position are shown
inclusive of GST.
Cash flows are presented in the statement of cash flows on a gross basis, except for the GST component of investing and
financing activities, which are disclosed as operating cash flows.
(r)
Comparatives
Where necessary, comparative information has been reclassified and repositioned for consistency.
(s)
Rounding of Amounts
In accordance with ASIC Corporations (Rounding in Financial/Directors’ Reports) Instrument 2016/191, the amounts in the
directors’ report and in the financial statements have been rounded to the nearest dollar.
NOTE 2:
SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS
Certain accounting estimates include assumptions concerning the future, which, by definition, will seldom represent actual
results. Estimates and assumptions based on future events have a significant inherent risk, and where future events are not
as anticipated there could be a material impact on the carrying amounts of the assets and liabilities discussed below:
(a)
Impairment of Non-Financial Assets other than Goodwill
All assets are assessed for impairment at each reporting date by evaluating whether indicators of impairment exist in relation
to the continued use of the asset by the Group. Impairment triggers include declining product performance, technology
changes, adverse changes in the economic or political environment or future product expectations. If an indicator of
impairment exists, the recoverable amount of the asset is determined.
The recoverable amount of a CGU is based on value in use calculations. The Directors have determined that there is one
CGU applicable to the cash flows generated. Value in use calculations are based on projected cash flows approved by
management covering a maximum five-year period. Management’s determination of cash flow projections are based on
past performance and its expectations of the future.
(b)
Income Tax
Deferred tax assets and liabilities are based on the assumption that no adverse change will occur in the income tax
legislation and the anticipation that the Group will derive sufficient future assessable income to enable the benefit to be
realised and comply with the conditions of deductibility imposed by the law.
(c)
Employee Benefits
The calculation of long-term employment benefits requires estimation of the retention of staff, future wage levels and timing
of the settlement of employee entitlements. The estimates are based on historical trends.
(d)
Share Based Payments
The Group measures the cost of equity settled transactions with employees by reference to the fair value of the equity
instruments on the date at which they are granted. The value of equity instruments granted is determined according to the
fair value of goods or services received unless that fair value cannot be estimated reliably, in which case the fair value is
determined by reference to the underlying value of equity instruments granted.
dorsaVi Annual Report 2021
40
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 3:
FINANCIAL RISK MANAGEMENT
The Group is exposed to a variety of financial risks comprising:
Interest rate risk
▪ Currency risk
▪
▪ Credit risk
▪ Liquidity risk
The Board of directors has overall responsibility for identifying and managing operational and financial risks.
The Group holds the following financial instruments:
Financial assets:
Cash and cash equivalents
Trade receivables
Other receivables
Finance liabilities:
Trade payables
Borrowings
Lease liability
Other payables
(a)
Currency Risk
2021
$
2020
$
2,796,175
617,092
620,130
4,033,397
1,685,288
284,886
646,334
2,616,508
75,258
1,595,557
101,737
920,758
2,693,310
79,656
1,664,934
246,984
1,160,824
3,152,398
The Group undertakes transactions denominated in foreign currencies. Currency risk is the risk that the fair value or future
cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.
The Group is exposed to foreign currency risk through the operation of wholly owned subsidiaries in the United Kingdom and
the United States of America and transactions occurring with countries in currencies that differ to the presentation currency
of the Group.
Whilst operations in these geographical regions are in their infancy, the Group has not established a hedging policy to
mitigate adverse currency risk.
The carrying amount of foreign currency denominated monetary assets and monetary liabilities at reporting date are:
Current assets
Current liabilities
Sensitivity:
2021
$
2020
$
USD
GBP
USD
GBP
645,218
393,388
251,830
51,228
108,910
(57,683)
366,204
224,352
141,853
202,301
244,044
(41,743)
If foreign exchange rates were to increase/decrease by 10% from rates used in the profit or loss during the financial year,
assuming all other variables that might impact on fair value remain constant, then the impact on loss for the year and equity
is as follows:
+/- 10%
Impact on loss after tax
Impact on equity
(b)
Interest Rate Risk
2021
$
61,137
61,137
2020
$
96,780
96,780
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate as a result of
changes in market interest rates.
dorsaVi Annual Report 2021
41
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
The Group’s exposure to interest rate risk in relation to future cash flows and the effective weighted average interest rates
on classes of financial assets and financial liabilities, is as follows:
2021
Financial Instruments
Financial assets
Cash
Term Deposit
Term Deposit
Term Deposit
Trade receivables
Other receivables
Financial liabilities
Trade payables
Insurance finance facility
Paycheck Protection Program loans
Convertible note
Lease liability
Other payables
2020
Financial Instruments
Financial assets
Cash
Term Deposit
Term Deposit
Term Deposit
Trade receivables
Other receivables
Non-interest
bearing
$
Total carrying
amount
$
Interest Bearing
$
2,676,182
51,381
28,612
40,000
-
-
-
-
2,676,182
51,381
28,612
40,000
617,092
620,130
4,033,397
-
-
2,796,175
617,092
620,130
1,237,222
Weighted
average effective
interest rate
0.51% Floating
0.20% Fixed
0.50% Fixed
0.25% Fixed
0.00%
0.00%
-
75,258
66,310
286,779
1,242,468
101,737
-
-
-
-
-
1,697,294
920,758
996,016
75,258
66,310
286,779
1,242,468
101,737
920,758
2,693,310
0.00%
4.1% Fixed
1% Fixed
10% Fixed
12% Fixed
0.00%
Non-interest
bearing
$
Total carrying
amount
$
Weighted average
effective interest
rate
Interest Bearing
$
1,556,908
51,381
27,932
49,067
-
-
-
-
1,556,908
51,381
27,932
49,067
284,886
646,334
2,616,508
0.70% Floating
2.65% Fixed
2.20% Fixed
1.92% Fixed
0.00%
0.00%
-
-
1,685,288
284,886
646,334
931,220
Financial liabilities
Trade payables
Insurance finance facility
Paycheck Protection Program loan
Convertible note
Lease liability
Other payables
-
79,656
52,455
152,892
1,459,587
246,984
-
-
-
-
-
1,911,918
1,160,824
1,240,480
79,656
52,455
152,892
1,459,587
246,984
1,160,824
3,152,398
0.00%
3.9% Fixed
1% Fixed
10% Fixed
12% Fixed
0.00%
No other financial assets or financial liabilities are expected to be exposed to interest rate risk. There are no variable
interest borrowings in the Group. The Group is exposed to variable interest cash and cash deposits held; however,
fluctuations due to interest rates are considered immaterial.
dorsaVi Annual Report 2021
42
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(c)
Credit Risk
Credit risk is the risk that one party to a financial instrument will cause a financial loss for the other party by failing to
discharge an obligation.
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date of recognised
financial assets is the carrying amount of those assets, net of any provisions for impairment of those assets, as disclosed in
consolidated statement of financial position and notes to the consolidated financial statements. The Group does not have
any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the
Group.
The Group minimises concentrations of credit risk in relation to trade receivables by undertaking transactions with a number
of known and existing customers and reputable organisations.
(i)
Cash Deposits:
Credit risk for cash deposits is managed by holding all cash deposits with major Australian banks.
(ii)
Trade Receivables:
Credit risk for trade receivables is managed by setting credit limits and completing credit checks for new customers.
Outstanding receivables are regularly monitored for payment in accordance with credit terms.
The ageing analysis of trade and other receivables is provided in Note 9.
As the Group undertakes transactions with a large number of customers and regularly monitors payment in accordance with
credit terms, the financial assets that are neither past due nor impaired, are expected to be received in accordance with the
credit terms.
(iii)
Other Receivables:
Other receivables relate to research and development tax concessions receivable from the Australian Taxation Office and
do not pose a material credit risk and unbilled debtors in relation to accrued income.
(d)
Liquidity Risk
The Group’s approach to managing liquidity risk is to ensure, as far as possible, that, at all times, it has sufficient liquidity to
meet its liabilities. The Group has cash reserves and expects to settle all financial liabilities when they fall due.
(e)
Fair Value
The fair value of financial assets and financial liabilities approximates their carrying amounts as disclosed in the
consolidated statement of financial position and notes to the consolidated financial statements.
dorsaVi Annual Report 2021
43
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 4:
REVENUE FROM CONTRACTS WITH CUSTOMERS AND OTHER INCOME
Revenue recognised at a point in time:
Clinical income
Workplace income
Revenue recognised over time:
Clinical income
Workplace income
Revenue from contracts with customers is disclosed in the segment note as follows:
Clinical income
Workplace income
Other income:
Grant and other income
Interest income
Change in fair value of derivative liability
2021
$
2020
$
169,264
278,224
447,488
134,482
381,529
516,011
963,478
458,016
1,421,494
1,868,982
990,669
512,540
1,503,209
2,019,220
1,130,045
738,937
1,868,982
1,125,151
894,069
2,019,220
549,601
11,125
560,726
349,925
2,779,633
278,252
99,587
377,839
-
2,397,059
Revenue from device sales is recognised over time and not at a point in time in accordance with AASB 15.
NOTE 5:
LOSS FROM CONTINUING OPERATIONS
Loss before income tax has been determined after:
Depreciation
Amortisation of patents and intangibles
Provision for impairment of patents and intangibles
Employee benefits expense:
- Share based payments
- Other employee benefits
Less employee benefits capitalised
Research and development expense
Cost of sales
Bad debts
176,619
33,584
-
210,203
203,357
836,290
4,018,354
5,058,001
301,686
2,560,541
2,862,227
-
2,862,227
960,529
166,328
98,103
344,665
3,353,872
3,698,537
658,172
3,040,365
1,051,411
96,967
27,375
dorsaVi Annual Report 2021
44
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 6:
INCOME TAX
(a) Components of tax benefit
Current tax
(b) Prima facie tax payable
The prima facie tax refundable on loss before income tax is reconciled to the income tax
benefit as follows:
Prima facie income tax refundable on loss before income tax at 26% (2020: 27.5%)
Add tax effect of:
- Accounting R&D expenditure
- Impairment of capitalised development expenditure
- Deferred tax assets / liabilities not recognised
- Share based payments expense
- Tax losses not recognised
Less tax effect of:
- R&D tax offset
- Under provision for tax in prior year
- Deduction under 240-880
- Effect of foreign tax rates
Income tax benefit attributable to loss
(c) Deferred tax assets not brought to account
Temporary differences
Operating tax losses
NOTE 7:
DIVIDENDS
There were no dividends paid during the period.
NOTE 8:
CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Deposits at call
NOTE 9:
RECEIVABLES
CURRENT
Receivables from contracts with customers
Allowance for credit losses
Contract assets
R&D tax offset refundable
2021
$
2020
$
(417,830)
(457,365)
(635,985)
(2,213,872)
249,738
-
28,709
78,438
356,672
713,447
281,293
1,105,047
27,255
94,783
786,660
2,295,038
417,830
-
40,039
37,533
495,402
(417,830)
444,955
12,409
49,566
31,601
538,531
(457,365)
195,731
8,207,823
8,403,554
229,734
7,832,197
8,061,931
2,676,182
119,993
2,796,175
1,556,908
128,380
1,685,288
694,090
(76,998)
617,092
374,727
(89,841)
284,886
189,742
430,388
1,237,222
201,379
444,955
931,220
dorsaVi Annual Report 2021
45
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Credit losses:
The group applies the simplified approach under AASB 9 to measuring the allowance for credit losses for both receivables
from contracts with customers and contract assets. Under the AASB 9 simplified approach, the group determines the
allowance for credit losses for receivables from contracts with customers and contract assets on the basis of the lifetime
expected credit losses of the instrument. Lifetime expected credit losses represent the expected credit losses that are
expected to result from default events over the expected life of the financial asset.
The group determines expected credit losses using a provision matrix based on the group’s historical credit loss experience,
adjusted for factors that are specific to the financial asset as well as current and future expected economic conditions
relevant to the financial asset. When material, the time value of money is incorporated into the measurement of expected
credit losses. There has been no change in the estimation techniques or significant assumptions made during the reporting
period.
Loss allowance at 1 July
Net remeasurement of loss allowance
Amounts written off
Loss allowance at 30 June
30 June 2021:
Estimated total gross carrying amount at
default
Expected credit loss rate
Expected credit loss
30 June 2020:
Estimated total gross carrying amount at
default
Expected credit loss rate
Expected credit loss
NOTE 10:
INVENTORIES
CURRENT
Finished goods, at cost
Work in progress, at cost
NOTE 11:
OTHER ASSETS
2021
$
(89,841)
(98,103)
110,946
2020
$
(126,611)
(27,375)
64,145
(76,998)
(89,841)
Not past
due
Past due
0-30 days
Past due
30-90 days
Past due
90+ days
Total
66,833
0.0%
22
427,227
0.0%
164
89,003
20.5%
18,284
111,027
52.7%
58,528
694,090
11.1%
76,998
69,457
0.0%
-
107,223
0.0%
31
37,928
1.3%
475
160,119
55.8%
89,335
374,727
24.0%
89,841
2021
$
2020
$
617,338
9,359
626,697
661,342
21,797
683,139
Prepayments
148,286
149,721
NOTE 12:
INTANGIBLE ASSETS
Patents, at cost
Less accumulated amortisation
Less provision for impairment
Development expenditure, at cost
Less accumulated amortisation
Less provision for impairment
1,191,858
(289,208)
(902,650)
1,158,274
(255,624)
(902,650)
-
-
5,261,956
(2,146,252)
(3,115,704)
-
-
5,261,956
(2,146,252)
(3,115,704)
-
-
dorsaVi Annual Report 2021
46
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(a)
Reconciliations
Reconciliation of the carrying amounts of intangible assets at the beginning and end of the current financial year:
Patents
Development Expenditure
Total
2021
$
2020
$
2021
$
2020
$
2021
$
2020
$
Opening carrying amount
Additions
Amortisation expense
Provision for impairment
Closing carrying amount
33,584
(33,584)
- 848,097
112,737
(58,184)
- (902,650)
-
-
-
-
-
- -
3,221,818
671,992
(778,106)
(3,115,704)
-
-
33,584
(33,584)
4,069,915
784,729
(836,290)
- (4,018,354)
-
-
During the year ended 30 June 2020 the Group assessed carrying value of its intangible assets for impairment based on
value in use calculations. This arose due to a change in the Group’s business strategy during that year (i.e. the transition to
a SaaS recurring revenue strategy), the Group’s forecasts were updated based upon reasonable and prudent assumptions
including growth rates (2.5%), discount rates (16%) and terminal values. This resulted in a provision for impairment of
$4,018,354 in the year ended 30 June 2020. Development expenditure incurred during the year ended 30 June 2021 has
been fully expensed. Should future performance exceed Group forecasts, the current impairment provision may be reversed
in future periods.
NOTE 13:
PLANT AND EQUIPMENT
Testing equipment, at cost
Accumulated depreciation
Leased devices, at cost
Accumulated depreciation
Office equipment, at cost
Accumulated depreciation
Furniture, fixtures and fittings, at cost
Accumulated depreciation
Right to use asset, at cost
Accumulated depreciation
Tooling, at cost
Accumulated depreciation
Total
2021
$
2020
$
128,760
(123,500)
5,260
128,760
(120,764)
7,996
267,743
(260,492)
7,251
267,743
(244,265)
23,478
342,068
(249,173)
92,895
290,239
(228,823)
61,416
63,691
(25,419)
38,272
63,691
(21,137)
42,554
401,718
(329,604)
72,114
401,718
(206,004)
195,714
94,258
(56,429)
37,829
253,621
94,258
(47,005)
47,253
378,411
(i) On 15 November 2018, the Group entered into a 39-month property lease. The agreement does not include variable
lease payments or residual guarantees. Standard extension options are not expected to be exercised.
dorsaVi Annual Report 2021
47
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(a)
Reconciliations
Reconciliation of the carrying amounts of plant and equipment at the beginning and end of the current financial year:
Testing equipment:
Opening carrying amount
Additions
Depreciation expense
Closing carrying amount
Leased devices:
Opening carrying amount
Depreciation expense
Closing carrying amount
Office equipment:
Opening carrying amount
Additions
Depreciation expense
Closing carrying amount
Furniture, fixtures and fittings:
Opening carrying amount
Depreciation expense
Closing carrying amount
Right to use asset:
Opening carrying amount
Depreciation expense
Closing carrying amount
Tooling:
Opening carrying amount
Depreciation expense
Closing carrying amount
Total:
Opening carrying amount
Additions
Depreciation expense
Closing carrying amount
2021
$
2020
$
7,996
-
(2,736)
5,260
12,475
125
(4,604)
7,996
23,478
(16,227)
7,251
59,558
(36,080)
23,478
61,416
51,829
(20,350)
92,895
82,362
3,948
(24,894)
61,416
42,554
(4,282)
38,272
47,307
(4,753)
42,554
195,714
(123,600)
72,114
319,314
(123,600)
195,714
47,253
(9,424)
37,829
56,679
(9,426)
47,253
378,411
51,829
(176,619)
253,621
577,695
4,073
(203,357)
378,411
dorsaVi Annual Report 2021
48
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 14:
PAYABLES
CURRENT
Unsecured liabilities
Trade payables
Contract liabilities
Sundry creditors and accruals
NOTE 15:
BORROWINGS
CURRENT
Unsecured liabilities
Premium finance facility (i)
Convertible note host debt (iv)
NON-CURRENT
Unsecured liabilities
Paycheck Protection Program loan No 1 (ii)
Paycheck Protection Program loan No 2 (iii)
Convertible note host debt (iv)
Derivative liability (iv)
2021
$
2020
$
75,258
791,233
129,525
996,016
79,656
866,136
294,688
1,240,480
66,310
179,943
246,253
52,455
129,486
181,941
139,572
152,892
147,207
-
702,725
620,376
359,800
1,349,304
1,595,557
709,725
1,482,993
1,664,934
(i)
(ii)
(iii)
(iv)
In March 2021, the Group entered into a finance facility for the annual insurance liability of dorsaVi Ltd. The
facility is repayable monthly over a 10 month period ending in December 2021 at an interest rate of 4.1%. A
similar finance facility was in place in the prior year.
Under USA federal government Covid19 relief measures, dorsaVi’s US subsidiary was, on 23 June 2020,
provided a Small Business Administration (SBA) Paycheck Protection Program (PPP) loan of US$104,930. The
facility is 60 month facility bearing fixed interest at the rate of 1% p.a. If certain conditions are met the SBA may
forgive up to 100% of the PPP loan balance and associated accrued interest. A loan forgiveness application was
lodged with the finance provider in February 2021. Systematic principal and interest payments, on any unforgiven
loan balance, commence after the amount of loan forgiveness is determined or 9 October 2021 whichever occurs
first.
Under USA federal government Covid19 relief measures, dorsaVi’s US subsidiary was, on 25 March 2021,
provided a second Small Business Administration (SBA) Paycheck Protection Program (PPP) loan of
US$110,670. The facility is 60 month facility bearing fixed interest at the rate of 1% p.a. If certain conditions are
met, within a covered 24 week period commencing 25 March 2021, the SBA may forgive up to 100% of the PPP
loan balance and associated accrued interest. Systematic principal and interest payments, on any unforgiven
loan balance, commence after the amount of loan forgiveness is determined or June 2022 whichever occurs first.
In December 2019 1,155,000 convertible notes were issued with a face value of $1 each. The notes will mature
in December 2022. Interest is payable at a rate of 10% p.a., monthly in arrears. As reflected in the above table,
and, in accordance with Accounting Standards, the convertible notes are considered a financial liability with a
host debt contract, held at amortised cost, and an embedded derivative liability, held at fair value through the
profit and loss. Accordingly, the derivative liability will be revalued at each reporting date.
Upon maturity the notes will convert into fully paid ordinary shares according to a 40 day VWAP calculation. In
accordance with the terms of the note agreement the maximum number of fully paid ordinary shares that can be
issued will be 38,500,000 and the minimum number will be 16,500,000.
dorsaVi Annual Report 2021
49
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 16:
LEASE LIABILITY
On 15 November 2018, the Group entered into a 39-month property lease and, in accordance with AASB 16: Leases, a
lease liability and a corresponding non-current asset, Right of Use Asset, refer Note 13, have been recognised.
Future minimum lease payments and the present value of the net minimum lease payments:
2021
$
2020
$
- Not later than one year
- Later than one year and not later than 5 years
Total minimum lease payments
- Future finance charges
Present value of minimum lease payment
Current lease liability
Non-current lease liability
NOTE 17:
PROVISIONS
CURRENT
Employee benefits
NON-CURRENT
Employee benefits
106,155
-
106,155
163,500
104,949
268,449
(4,418)
(21,465)
101,737
246,984
101,737
-
101,737
144,269
102,715
246,984
202,677
206,911
2,841
9,441
(a) Aggregate employee benefits liability
205,518
216,352
NOTE 18:
SHARE CAPITAL
The Group’s share capital is as follows:
Ordinary Shares
Parent Equity
2021
No of Shares
$
Parent Equity
2020
No of Shares
$
Beginning of the financial year
Issued during the financial year:
- Employee share scheme (i)
- Other shares issued (ii)
- Shares issued in capital raising (iii)
- Cost of raising capital
End of the financial year
231,427,524
41,080,353
204,016,783
40,381,715
1,084,000
2,707,286
115,713,762
-
350,932,572
-
-
3,702,840
(250,331)
44,532,862
-
-
27,410,741
-
231,427,524
-
-
746,760
(48,122)
41,080,353
(i)
Shares Issued under the Employee Share Ownership Plan:
During the year 1,084,000 performance rights previously granted to employees under the Employee Share Ownership Plan
(ESOP) vested into shares. The shares were issued for $Nil consideration. During the prior year no performance rights
previously granted to employees under the Employee Share Ownership Plan (ESOP) vested into shares.
dorsaVi Annual Report 2021
50
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(ii)
Other Shares Issued
As approved at the 2020 AGM, 2,707,286 shares were issued, at $Nil per share, to the Managing Director in lieu of a
reduction in cash wages and other entitlements of $75,804.
(iii)
Shares Issued in a Capital Raising:
During the year ended 30 June 2021, the Group issued:
▪ 106,360,517 fully paid ordinary shares, at $0.032 per share, to sophisticated and institutional investors raising
$3,403,537 before costs; and
▪ 9,353,245 fully paid ordinary shares, at $0.032 per share, under a share purchase plan to eligible shareholders, raising
$299,304 before costs.
During the year ended 30 June 2020, the Group issued:
▪ 20,740,741 fully paid ordinary shares, at $0.027 per share, to sophisticated and institutional investors raising $560,000
before costs; and
▪ 6,670,000 fully paid ordinary shares, at $0.028 per share, under a share purchase plan to eligible shareholders, raising
$186,760 before costs.
Rights of each Type of Share
Ordinary shares participate in dividends and the proceeds on winding up of the parent entity in proportion to the number of
shares held. At shareholders’ meetings, each ordinary share is entitled to one vote when a poll is called, otherwise each
shareholder has one vote on a show of hands.
Capital Management
When managing capital, management's objective is to ensure the Group continues as a going-concern as well as to
maintain optimal returns to shareholders and benefits for other stakeholders. This is achieved through the monitoring of
historical and forecast performance and cash flows.
Employee Share Ownership Plan (ESOP)
The Group continued to offer employee participation in short-term and long-term incentive schemes as part of the
remuneration packages for the employees of the Group. Refer to Note 23, Share Based Payments, for detailed disclosures.
NOTE 19:
RESERVES AND ACCUMULATED LOSSES
Notes
2021
$
2020
$
Share-based payment reserve
Foreign currency translation reserve
19(a)
19(b)
1,173,557
(772,079)
401,478
983,554
(750,301)
233,253
Accumulated losses
19(c)
(42,771,161)
(40,854,577)
(i)
Nature and Purpose of Reserves
The share-based payment reserve is used to record the fair value of options and shares issued to employees as part of their
remuneration. The balance is transferred to share capital when options are granted, and the balance is transferred to
retained earnings when options lapse.
dorsaVi Ltd has monetary items receivable and payable to and from its subsidiaries. Under AASB 121: The Effects of
Changes in Foreign Exchange Rates, these items are reviewed annually. During the financial year ending 30 June 2020 it
was determined that these items would be treated as an investment in those foreign operations. As a result, exchange
differences on these items are recognised initially in other comprehensive income and reclassified from equity to profit or
loss on disposal of the net investment.
dorsaVi Annual Report 2021
51
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(ii) Movements in reserve
(a) Share-based payment reserve
Balance at beginning of year
Employee share ownership plan
Transfers to retained earnings
Balance at end of year
(b) Foreign currency translation reserve
Balance at beginning of year
Exchange differences on translation of foreign operations
Balance at end of year
(c) Accumulated losses
Balance at beginning of year
Net loss attributable to members of dorsaVi Ltd
Transfers from share-based payment reserve
Balance at end of year
NOTE 20:
CASH FLOW INFORMATION
(a)
Reconciliation of Cash:
2021
$
2020
$
983,554
301,686
(111,683)
1,173,557
692,619
344,665
(53,730)
983,554
(750,301)
(21,784)
(772,085)
(769,812)
19,511
(750,301)
(40,854,577)
(2,028,267)
111,683
(33,315,228)
(7,593,079)
53,730
(42,771,161)
(40,854,577)
Cash at the end of the financial year as shown in the statement of cash flows is reconciled to the related items in the
statement of financial position as follows:
Cash at bank and on hand
Cash on deposit
2,676,182
119,993
2,796,175
1,556,908
128,380
1,685,288
dorsaVi Annual Report 2021
52
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(b) Reconciliation of cash flow used in operations with loss after income
tax:
Loss from ordinary activities after income tax
Adjustments and non-cash items:
Amortisation
Depreciation
Provision for impairment of intangibles
Share Based Payments
Movement in debtor provision
Foreign exchange differences on operating assets
Unrealised foreign exchange differences through profit and loss
Change in fair value of derivative liability
Interest adjustment on convertible note host debt
Adjustment to carrying value of convertible note through the profit and loss
Changes in assets and liabilities:
(Increase)/decrease in receivables
(Increase) / decrease in other assets
(Increase) / decrease in inventories
Increase in payables
(Increase) / decrease in R&D tax offset receivable
Increase / (decrease) in provisions
2021
$
2020
$
(2,028,267)
(7,593,079)
33,584
176,619
-
301,686
(12,843)
(33,477)
-
(349,925)
132,806
-
836,290
203,357
4,018,354
344,665
(36,770)
19,511
-
278,151
62,607
21,579
(307,726)
1,435
56,442
(244,464)
14,567
(10,834)
(242,130)
347,464
(7,143)
(374,619)
(272,727)
121,693
(148,887)
5,413,525
Cash flows used in operating activities
(2,270,397)
(2,179,554)
(c) Reconciliation of liabilities arising from financing activities:
Balance at the beginning of the year
New leases acquired
Interest accrued
Payments made
Balance at the end of the year
246,984
-
21,833
(167,080)
101,737
360,994
-
37,836
(151,846)
246,984
NOTE 21:
COMMITMENTS AND CONTINGENCIES
(a) Expenditure commitments
There are no material expenditure commitments at balance date.
(b) Contingent asset and liabilities
There are no contingent assets or contingent liabilities at balance date.
dorsaVi Annual Report 2021
53
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 22:
LOSS PER SHARE
Reconciliation of loss used in calculating loss per share:
Loss from continuing operations
Loss used in calculating basic loss per share
Loss used in calculating diluted loss per share
Weighted average number of ordinary shares used in calculating basic
earnings per share
Effect of dilutive securities:
Equity instruments
Adjusted weighted average number of ordinary shares used in calculating
diluted earnings per share
NOTE 23:
SHARE BASED PAYMENTS
(a)
Employee Shares
2021
$
(2,028,267)
(2,028,267)
(2,028,267)
2020
$
(7,593,079)
(7,593,079)
(7,593,079)
2021
No of Shares
2020
No of Shares
296,433,675
217,396,418
-
-
296,433,675
217,396,418
In 2013 the Board established an ESOP to facilitate the acquisition of Shares, Options and Performance Rights by those
employed, or otherwise engaged by, or holding a position of office in, dorsaVi Ltd.
They key objective of the plan is to provide an incentive for employees to align their interests with those of the shareholders.
Other objectives of the ESOP include:
▪ To attract, motivate and retain quality employees and Directors of dorsaVi Ltd;
▪ To create a committed and united purpose between the employees and Directors and dorsaVi Ltd; and
▪ To add wealth for all shareholders of dorsaVi through the motivation of dorsaVi’s employees and Directors.
Only a person who is an Eligible Person may be invited and authorised by the Board to participate in this plan. An Eligible
person means:
▪ An employee of dorsaVi Ltd or a subsidiary of dorsaVi Ltd; or
▪ A Director of dorsaVi Ltd or a subsidiary of dorsaVi Ltd who holds a salaried employment or office in dorsaVi Ltd or a
subsidiary of dorsaVi Ltd; or
▪ A contractor engaged by dorsaVi Ltd or a subsidiary of dorsaVi and whom the Group has determined is an Eligible
Person to participate in this plan.
There is no maximum limit on the number of Securities that may be acquired by Eligible Persons under the ESOP.
However, the Board intends to restrict further issues of Securities to no more than 5% of the Group’s issued share capital.
This limit will be maintained unless shareholder approval is subsequently sought to increase this level.
(b)
Loan Shares and Options
The plan allows for dorsaVi to offer employees non-recourse and interest-free loans to acquire fully paid shares. On 20
September 2013, the Group’s shareholders approved the giving of such financial assistance. Loan shares are treated as
options in accordance with accounting standards.
Loan Shares are subject to restriction agreements imposing loan repayment obligations, and, that the holders of Shares are
not able to trade them within 12 months of issuance. After 12 months, 1/3rd of the issued shares can be traded. Contingent
upon continued employment with the Group and meeting loan repayment obligations, the remaining shares become
available for trading at a monthly rate of 1/36th of the shares issued over the subsequent 24 months.
During the year ended 30 June 2021 and to the date of this report no options over ordinary shares or loan shares were
granted to employees (2020: Nil) and 5,659,728 options over ordinary shares were granted to non-executive directors in lieu
of the payment of directors’ fees (2020: 12,739,588). During the year a total of 200,000 options were cancelled (2020:
50,000 options cancelled). At 30 June 2021, 18,978,482 options had been granted but not converted into ordinary shares
(2020: 13,518,754).
dorsaVi Annual Report 2021
54
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
(c)
Employee Performance Rights
Performance rights are subject to performance vesting conditions in accordance with each agreement. The performance
rights do not vest into shares unless the performance conditions are met. During the year ended 30 June 2021, 1,000,000
performance rights were granted (2020: 2,331,071). During the year ended 30 June 2021, 1,084,000 (2020: 2,826,601)
performance rights vested into shares. During the year ended 30 June 2021, 146,000 performance rights lapsed (2020:
155,470). At 30 June 2021, 200,000 performance rights remain outstanding (2020: 430,000).
Details of shares, options and performance rights granted are as follows:
2021
Grant date
Expiry date
Exercise
price
Balance at
1/7/2020
Granted
during the
year
Vested
during the
year
Expired
during
the year
Balance at
30/6/2021
Exercisable
at year end
5-Nov-14
25-Feb-15
24-Mar-16
15-May-17
15-May-17
15-May-17
18-Sep-19
18-Sep-19
18-Sep-19
4-Dec-19
4-Dec-19
7-Jan-20
7-Apr-20
7-Jul-20
7-Oct-20
8-Jan-21
8-Apr-21
5-Jul-21
TOTAL
5-Nov-24
25-Feb-25
24-Mar-21
15-May-22
1-Oct-22
1-Oct-23
1-Oct-20
1-Oct-21
18-Sep-22
4-Dec-24
4-Dec-24
7-Jan-25
7-Apr-25
7-Jul-25
7-Oct-25
8-Jan-26
8-Apr-26
5-Jul-26
$0.40
$0.36
$0.40
$0.33
$0.33
$0.33
-
-
-
$0.084
$0.070
$0.034
$0.022
$0.016
$0.049
$0.061
$0.063
$0.041
20,000
50,000
200,000
500,000
55,000
24,166
115,000
115,000
200,000
1,280,488
1,116,703
1,846,856
4,801,827
3,693,714
-
-
-
-
14,018,754
-
-
-
-
-
-
-
-
- 20,000
50,000
- -
20,000
50,000
500,000
55,000
24,166
- 200,000
-
-
-
84,000
- 500,000
- 55,000
- 24,166
31,000
- 115,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,412,303 1,412,303
1,171,178 1,171,178
1,297,792 1,297,792
1,778,455 1,778,455
5,659,728 5,743,728
- -
- -
-
1,280,488
1,116,703
1,846,856
4,801,827
3,693,714
1,412,303
1,171,178
1,297,792
1,778,455
19,048,482
- 200,000
- 1,280,488
- 1,116,703
- 1,846,856
- 4,801,827
- 3,693,714
- 1,412,303
- 1,171,178
- 1,297,792
- 1,778,455
19,248,482
346,000
Other additional information associated with these share performance rights and option grants include:
▪ The weighted average remaining contractual life for equity entitlements outstanding at the end of the period was 3.5
years.
▪ The weighted average share price for performance rights vesting into shares during the year was $Nil (2020: $Nil).
▪ There were no options exercised during the year (2020: none exercised).
▪ The fair value was determined using the binomial tree method or the Black-Scholes option-pricing models:
a. The share price at grant date ranged from: $0.01 to $0.40
b. Expected price volatility of the Group’s shares: 80%
c. Dividends: $Nil
d. Risk free interest rate: 1.51% to 2.50%
dorsaVi Annual Report 2021
55
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
2020
Grant date
Expiry
date
Exercise
price
Balance at
1/7/2019
Granted during
the year
Vested
during the
year
Expired during
the year
Balance at
30/6/2020
Exercisable at
year end
5-Nov-24
5-Nov-14
25-Feb-25
25-Feb-15
24-Mar-21
24-Mar-16
1-Oct-19
29-Nov-16
29-Nov-16
29-Nov-19
15-May-17 15-May-22
1-Oct-22
15-May-17
1-Oct-23
15-May-17
1-Oct-19
15-May-17
1-Jul-19
15-May-17
1-Oct-19
5-Jun-17
1-Jul-19
5-Jun-17
18-Sep-19
18-Sep-19
1-Oct-19
18-Sep-19
1-Oct-20
18-Sep-19
1-Oct-21
18-Sep-19
18-Sep-22
18-Sep-19
4-Dec-24
4-Dec-19
4-Dec-24
4-Dec-19
7-Jan-25
7-Jan-20
7-Apr-25
7-Apr-20
25-Jun-20
25-Jun-20
7-Jul-25
7-Jul-20
TOTAL
$0.40
$0.36
$0.40
$0.33
$0.33
$0.33
20,000
50,000
200,000
- 150,000
- 450,000
550,000
55,000
24,166
- 39,000
- 117,000
- 125,000
- 200,000
- - 760,000
- - 70,000
- - 115,000
- - 115,000
- - 200,000
- 1,280,488
- 1,116,703
- 1,846,856
- 4,801,827
- - 1,071,071
- 3,693,714
15,070,659
1,980,166
20,000
- - - 20,000
50,000
- -
50,000
100,000
- - - 200,000
- -
87,000
- 63,000
- - -
- 450,000
500,000
- - 50,000
500,000
55,000
- - - 55,000
- - - 24,166
24,166
- -
17,470
- 21,530
- - -
- 117,000
49,250
- 75,750
- -
- - -
- 200,000
- - -
760,000
- -
68,250
1,750
-
- - 115,000
-
- - 115,000
-
- - 200,000
1,280,488
- 1,280,488
1,280,488
1,116,703
- 1,116,703
1,116,703
1,846,856
- 1,846,856
1,846,856
- 4,801,827
4,801,827
4,801,827
- - -
1,071,071
3,693,714
- 3,693,714
3,693,714
13,488,754
14,018,754
205,470
15,566,189
$0.086
$0.072
$0.036
$0.024
$0.018
(d)
Expenses Recognised from Share-Based Payment Transactions
The expense recognised in relation to the share-based payment transactions was recorded within employee benefits
expense in the statement of comprehensive income were as follows:
2021
$
2020
$
Share options
Performance rights
Total expenses recognised from share-based payment transactions
192,072
109,614
301,686
256,097
88,568
344,665
dorsaVi Annual Report 2021
56
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 24:
SUBSIDIARIES AND RELATED PARTY DISCLOSURES
The consolidated financial statements include the financial statements of dorsaVi Ltd and its controlled entities listed below:
dorsaVi Europe Ltd
dorsaVi USA, Inc.
Australian Workplace Compliance Pty Ltd
Country of
incorporation
Ownership interest held by
DVL
UK
USA
AUS
2020
%
100
100
100
2019
%
100
100
100
▪ dorsaVi Europe Ltd was incorporated on 3 February 2014.
▪ dorsaVi USA, Inc. was incorporated on 19 May 2014.
▪ Australian Workplace Compliance Pty Ltd was purchased on 3 July 2014.
(a)
Transactions with Entities with Associates:
There were no transactions with associates or their entities during the year ended 30 June 2021 (2020: $Nil).
(b)
Transactions with Directors, Key Management Personnel and Other Related Parties:
During the year ended 30 June 2021, dorsaVi Ltd paid $Nil (2020: $Nil) to Starfish Ventures Pty Ltd on behalf of Michael
Panaccio for director’s fees. As approved by shareholders at the 2019 and 2020 AGMs, non-executive directors were
granted options over ordinary shares in lieu of the payment of directors’ fees. During the year ended 30 June 2021, Starfish
Ventures Pty Ltd was granted 1,296,529 options on behalf of Michael Panaccio (2020: 2,918,381).
NOTE 25:
AUDITOR'S REMUNERATION
Audit and Other Assurance Services
Amounts paid and payable to Pitcher Partners (Melbourne) for:
(i)
An audit or review of the financial report of the entity and any other entity
in the consolidated entity
Total remuneration for audit and other assurance services
(ii)
Taxation and other compliance services
Total remuneration for non-audit services
Total remuneration of Pitcher Partners (Melbourne)
Other Non-audit Services
2021
$
107,300
107,300
11,100
11,100
118,400
2020
$
109,900
109,900
14,901
14,901
124,801
dorsaVi Annual Report 2021
57
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
NOTE 26:
PARENT ENTITY INFORMATION
(a) Summarised statement of financial position
Assets:
Current assets
Non-current assets
Total assets
Liabilities:
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Equity:
Share capital
Share-based payment reserve
Accumulates losses
Total equity
(b) Summarised statement of comprehensive income
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
NOTE 27:
SEGMENT INFORMATION
(a)
Description of Segments
2021
$
2020
$
4,916,284
253,621
5,169,905
4,135,287
378,411
4,513,698
2,050,022
2,095,663
1,065,366
3,115,388
2,054,517
1,339,542
3,435,205
1,078,493
44,532,862
1,173,557
(43,651,902)
2,054,517
41,080,353
983,554
(40,985,414)
1,078,493
(2,112,797)
(20,260,016)
-
-
(2,112,797)
(20,260,016)
For the years ended 30 June 2021 and 2020, management has differentiated operating segments based on product.
The Group’s chief operating decision maker has identified the following reportable segments:
▪ Segment 1: Clinical;
▪ Segment 2: Workplace
The operating segments have been identified based on internal reports reviewed by the Group’s chief operating decision
makers in order to allocate resources to the segment and assess its performance. Assets and liabilities are reported to
management on a consolidated basis.
(b)
Segment Information
The Group’s chief operating decision maker’s use segment revenue and segment result to assess the financial performance
of each operating segment.
Amounts for segment information are measured in the same way in the financial statements. They include items directly
attributable to the segment and those that can reasonably be allocated to the segment based on the operations of the
segment. There has been no inter-segment revenue during the year.
dorsaVi Annual Report 2021
58
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Segment information is reconciled to financial statements and underlying profit disclosure notes as follows:
2021
Segment revenue:
Segment revenue from external source
Non-segment revenue
Total revenue
Segment result:
Segment result from external source
Non-segment revenue
Non-segment expenses
Income tax benefit
Loss from continuing operations
2020
Segment revenue:
Segment revenue from external source
Non-segment revenue
Total revenue
Segment result:
Segment result from external source
Non-segment revenue
Non-segment expenses
Income tax benefit
Loss from continuing operations
Revenue by geographic location:
2021
Revenue by geographic location
Total revenue from external source
2020
Revenue by geographic location
Total revenue from external source
(c)
Major Customers
Clinical
$
Workplace
$
Total
$
1,130,045
738,937
-
-
1,868,982
910,651
2,779,633
984,757
-
-
-
717,897
1,702,654
-
910,651
- (5,059,402)
417,830
-
(2,028,267)
1,125,151
894,069
-
-
2,019,220
377,839
2,397,059
1,054,240
-
-
-
868,013
1,922,253
377,839
-
- (10,350,535)
457,364
-
(7,593,079)
Australia
$
Europe
$
USA
$
Total
$
1,399,037
1,399,037
277,272
277,272
1,103,324
1,103,324
2,779,633
2,779,633
902,619
902,619
436,250
436,250
1,058,190
1,058,190
2,397,059
2,397,059
In 2021 and 2020 no customer contributed greater than 10% of the Group’s total revenue.
NOTE 28:
SUBSEQUENT EVENTS
No matters or circumstances have arisen since the end of the financial year that have significantly affected or may
significantly affect the operations of the Group, the results of those operations, or the state of affairs of the Group in future
financial years with the exception of the following:
•
On 7 July 2021, dorsaVi Ltd announced the issue of 1,778,455 options to non-executive directors, in lieu of directors’
fees, at an exercise price of $0.041per share and an expiry date of 5 July 2026. The impact of the grant of these
options was recognised in share-based payments as at 30 June 2021.
dorsaVi Annual Report 2021
59
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Directors’ Declaration
The directors declare that the financial statements and notes set out on pages 28 to 59 in accordance with the Corporations
Act 2001:
a) Comply with Accounting Standards and the Corporations Regulations 2001, and other mandatory professional reporting
requirements;
b) As stated in Note 1(a) the consolidated financial statements also comply with International Financial Reporting
Standards; and
c) Give a true and fair view of the financial position of the Group as at 30 June 2021 and of its performance for the year
ended on that date.
In the directors’ opinion, there are reasonable grounds to believe that dorsaVi Ltd will be able to pay its debts as and when
they become due and payable.
This declaration has been made after receiving the declarations required to be made by the chief executive officer and chief
financial officer to the directors in accordance with section 295A of the Corporations Act 2001 for the financial year ending
30 June 2021.
This declaration is made in accordance with a resolution of the directors.
Greg Tweedly
Chairman
Andrew Ronchi
Director and CEO
Melbourne
Date: 26August 2021
Melbourne
Date: 26 August 2021
dorsaVi Annual Report 2021
60
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF dorsaVi Ltd
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of dorsaVi Ltd “the Company” and its controlled entities “the
Group”, which comprises the consolidated statement of financial position as at 30 June 2021, the
consolidated statement of profit or loss and other comprehensive income, consolidated statement of
changes in equity and consolidated statement of cash flows for the year then ended, and notes to the
financial statements, including a summary of significant accounting policies, and the directors’
declaration.
In our opinion, the accompanying financial report of dorsaVi Ltd, is in accordance with the Corporations
Act 2001, including:
(a) giving a true and fair view of the Group’s financial position as at 30 June 2021 and of its financial
performance for the year then ended; and
(b) 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 a Financial
Report section of our report. We are independent of the Company 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 (including Independence Standards) “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.
Material Uncertainty Related to Going Concern
We draw attention to Note 1(c) in the financial report that conditions exist that indicate a material
uncertainty exists that may cast significant doubt on the Group’s ability to continue as a going
concern. Our opinion is not modified in respect of this matter.
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 of 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.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
61
pitcher.com.au
60
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF dorsaVi Ltd
Key Audit Matter
How our audit addressed the key audit
matter
Our procedures included amongst others:
• Understanding
the groups controls and
processes for recognising and recording
revenue transactions.
Evaluating
processes
managements
regarding recognition of revenue for sales
and services provided.
Evaluating a sample of managements
recognised, accrued and deferred revenue
recognition calculations, including review of
terms and conditions of relevant customer
contracts.
Testing existence of revenue transactions to
supporting documentation.
Analysing general journal entries impacting
revenue.
Assessing the adequacy of the disclosures in
the financial statements.
•
•
•
•
•
Revenue Recognition
Refer to Note 4 – Revenue - $2,779,633
The Group’s revenue of $2,779,633 (2020:
$2,397,059) is derived from clinical revenue,
workplace revenue and other income.
We focused on the existence and appropriate
recognition of revenue as a key audit matter as
these are a key contributor to the determination of
profit and loss, and judgement is required in
assessing revenue recognition and associated
accrued or deferred revenue (contract assets and
contract liabilities) in accordance with AASB 15
Revenue from contracts with customers.
`
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
62
pitcher.com.au
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF dorsaVi Ltd
Key Audit Matter
Convertible Note Liability
Refer to Note 15 – Convertible note host debt - $882,868
Refer to Note 15 – Derivative liability- $359,800
How our audit addressed the key audit matter
Our procedures included amongst others:
• Obtaining an understanding of and evaluating
the accounting processes and internal controls
relating to convertible notes;
• Reviewing the terms of the Convertible notes;
•
Assessing the appropriate treatment of the
Convertible notes in accordance with AASB 9:
Financial Instruments;
• Reviewing the external valuation obtained by
•
•
•
the Group;
Evaluating the credentials of the external
valuer;
Assessing the appropriateness of the valuation
methodology and inputs utilised by the external
valuer;
Assessing the adequacy of the disclosures in
the financial statements.
The measurement of the Convertible notes
issued during the year is considered a key audit
matter due to the following:
•
The terms of the Convertible notes were
assessed as being a financial liability with a
host debt contract held at amortised cost,
and an embedded derivative liability, held at
fair value through the profit and loss.
Accordingly, the host debt and derivative
liability components of the Convertible notes
require valuation upon initial recognition,
and the derivative liability is required to be
revalued at each reporting date. The initial
valuation of the respective components, and
the subsequent valuation of the derivative
liability contains complexity.
The recognition of the host debt as at 30 June
2020 was $749,861 and the fair value of the
derivative liability was $709,725. The fair value
adjustment of the derivative liability at 30 June
2021 was a decrease to $359,800 with the
$349,925 change of fair value being recognised
as income in the profit and loss.
We focused on the fair value adjustment of the
derivative liability at balance date as a key audit
matter due to the complexity of the valuations
required.
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 2021, 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
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, 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.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
63
pitcher.com.au
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF dorsaVi Ltd
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 Group’s ability 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.
• 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.
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
64
pitcher.com.au
dorsaVi Ltd and controlled entities
ABN 15 129 742 409
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF dorsaVi Ltd
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, actions to eliminated threats
or safeguards applied.
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 in pages 18 to 26 of the directors’ report for the
year ended 30 June 2021. In our opinion, the Remuneration Report of dorsaVi Ltd, for the year ended
30 June 2021 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.
S SCHONBERG
Partner
26 August 2021
PITCHER PARTNERS
Melbourne
Pitcher Partners. An independent Victorian Partnership ABN 27 975 255 196. Level 13, 664 Collins Street, Docklands, VIC 3008
Pitcher Partners is an association of independent firms. Liability limited by a scheme approved under Professional Standards Legislation.
Pitcher Partners is a member of the global network of Baker Tilly International Limited, the members of which are separate and independent legal entities
Adelaide Brisbane Melbourne Newcastle Sydney Perth
65
pitcher.com.au
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Shareholder Information
Corporate Governance:
The Group’s Corporate Governance Statement can be obtained at https://www.dorsavi.com/au/en/investor-
relations/
Overview:
The Group’s securities are listed for quotation in the form of Ordinary Shares on the Australian Securities Exchange (ASX)
and trade under the symbol “DVL”. The shareholder information below was applicable as at 13 August 2021.
The Group’s share capital was as follows:
Type of Security:
Ordinary Shares
Options
Performance Rights
Substantial Holders:
Names of Holders
Starfish Technology Fund II, LP, Starfish Ventures, Michael Panaccio and
Cristiana Panaccio and Micana Family Trust
Unmarketable Parcels:
Number of
Securities
350,932,572
18,978,482
200,000
Number of
Holders
1,394
5
1
Number of
Shares Held
% of Total
Shares
102,875,786
29%
Based on the closing market price on 13 August 2021, there were 549 shareholders holding less than a marketable parcel
(i.e. a parcel of securities of less than $500).
Options and Performance Rights (not listed on ASX):
There were 18,978,482 unquoted options on issue to purchase ordinary shares under the Group’s Incentive Stock Option
Agreement. The Options have been issued in accordance with the terms and conditions of the dorsaVi Ltd 2013 Share
Ownership Plan.
There were 200,000 unquoted Performance Rights granted, but not vested into ordinary shares, under the Group’s Incentive
Agreements. The Performance Rights have been granted in accordance with the terms and conditions of the dorsaVi Ltd
2013 Share Ownership Plan.
Restricted Securities and Escrow Agreements:
There are no securities which are restricted or subject to escrow agreements.
Voting Rights:
At a general meeting, each Shareholder present (in person or by proxy, attorney or representative) has one vote on a show
of hands and one vote for each share held when voting is done via a poll.
Proxy forms will be included in each notice of meeting sent to Shareholders. Holders of issued but unexercised options are
not entitled to vote.
dorsaVi Annual Report 2021
66
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Required Statements:
a)
b)
There is no current on-market buy-back of the Group’s securities.
The Group’s securities are not quoted on any exchange other than the ASX.
Distribution Schedule:
Number of Shares
1 – 1,000
1,001 - 5,000
5,001 - 10,000
10,001 – 100,000
100,001 and above
Total
dorsaVi Ltd’s Top 20 Shareholders:
Set out below is a schedule of the 20 largest holders of each class of securities quoted.
Rank
1
Name
STARFISH TECHNOLOGY FUND II LP
2
2
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
STARFISH TECHNOLOGY FUND II NOMINEES A PTY LTD
STARFISH TECHNOLOGY FUND II NOMINEES B PTY LTD
PUSEN MEDICAL TECHNOLOGY AUSTRALIA PTY LTD
MS CHUNYAN NIU
MR BILAL AHMAD
AR BSM PTY LTD
MR SALVATORE DI VINCENZO
ANDREW RONCHI
BANNABY INVESTMENTS PTY LIMITED
449 INVESTMENTS PTY LTD
TANARNY SUPER FUND PTY LTD
MR BILAL AHMAD
SHADEBRIDGE PTY LTD
MS GABRIELLE BANAY
DRNEWNHAM SUPER PTY LTD
VALENCE HOLDINGS PTY LTD THE PW & CM STINTON
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
MR STUART ANDREW LEWIN
BUTTONWOOD NOMINEES PTY LTD
Number of Holders
54
148
131
675
386
1,394
No of
Shares
Held
60,597,345
18,464,557
18,464,557
13,500,000
11,542,752
8,000,000
7,021,814
5,844,201
5,675,171
4,428,497
3,762,500
3,703,704
3,367,233
3,268,563
3,233,482
3,231,516
3,000,000
2,913,893
2,829,000
2,631,000
% of
Total
Shares
17.27
5.26
5.26
3.85
3.29
2.28
2.00
1.67
1.62
1.26
1.07
1.06
0.96
0.93
0.92
0.92
0.85
0.83
0.81
0.75
Total ordinary fully paid shares held by top 20 shareholders
Total ordinary fully paid shares held by all other shareholders
185,479,785
165,452,787
52.85
47.15
dorsaVi Annual Report 2021
67
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
Corporate Directory:
Board of Directors and Company Secretary:
Mr Gregory Tweedly
Mr Ashraf Attia
Ms Caroline Elliott
Dr Michael Panaccio
Dr Andrew Ronchi
Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Chief Executive Officer
and Executive Director
Company Secretary
Mr Brendan Case
Executive Team:
Dr Andrew Ronchi
Mr Damian Connellan
Ms Joanna Goldin
Ms Jasmine Pateras
Chief Executive Officer
Chief Financial Officer
Clinical Manager
Workplace Manager
Registered Office in Australia:
C/- Pitcher Partners, Level 13,
664 Collins Street, Docklands, VIC 3008
Tel: +61 3 8610 5000
Principal Administrative Office:
85 Denmark Street,
Kew, VIC 3101
Tel: 1800 367 728
Auditor:
Pitcher Partners
Level 13, 664 Collins Street,
Docklands, VIC 3008
Tel: +61 3 8610 5000
Annual General Meeting Date and Venue:
The Annual General Meeting will be held Friday, 26
November 2021 at 9:00 am. Due to the COVID 19
pandemic, the AGM will be a virtual meeting held
online.
Share Registry:
Computershare Investor Services Pty Limited
GPO Box 2975, Melbourne, VIC 3001
Tel: + 61 3 9415 4062
dorsaVi Annual Report 2021
68
dorsaVi Ltd and controlled entities
ABN: 15 129 742 409
dorsaVi Annual Report 2021
69