ABN 64 089 145 424
DUBBER CORPORATION LIMITED
FORMERLY KNOWN AS CRUBIBLE GOLD LIMITED
Annual Report
30 June 2015
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Corporate Directory
BOARD OF DIRECTORS
Peter Pawlowitsch
Non-Executive Chairman
Steve McGovern
Managing Director
Ken Richards
Gavin Campion
Non-executive Directors
Ian Hobson
Company Secretary
SHARE REGISTER
Automic Registry Services
Suite 1A, Level 1, 7 Ventnor Avenue
West Perth WA 6005
Telephone +61 8 9324 2099
Facsimile +61 8 9321 2337
AUDITOR
BDO AUDIT (WA) PTY LTD
38 Station Street
Subiaco WA 6008
STOCK EXCHANGE
Dubber Corporation Limited shares are
listed on the Australian Securities Exchange
ASX Code: DUB
PRINCIPAL AND REGISTERED OFFICE IN AUSTRALIA
Suite 5, 2 Russell Street
Melbourne VIC 3000
Telephone: +61 3 8566 7888
Website: www.dubber.net/corporation
SOLICITOR
Nova Legal
Solicitor
Grd Floor 10 Ord Street
Nova Legal
West Perth WA 6005
BANKER
Westpac Banking Corporation Limited
150 Collins Street
Melbourne VIC 3000
Annual Report - 30 June 2015
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DUBBER CORPORATION
ABN 64 089 145 424
Chairman’s Letter
Dear Shareholders
CHAIRMAN’S LETTER
The acquisition of Dubber has been pivotal to the change in direction of the Company with a number of exciting
developments announced at a time when many junior ASX listed companies have continued struggle in challenging
market conditions.
The Company acquired the Dubber technology suite from Medulla Group Pty Ltd, with the transaction and associated
capital raising finalising throughout the year.
The Dubber technology suite provides call recording and audio asset management in the cloud. Dubber provides
enhanced service at a fraction of the cost base and is flexible to a myriad of applications, not easily achievable with
current market solutions. These benefits include immediate access to the call recording at any time from any location
and the ability to asset manage and utilise recordings within existing enterprise systems as is the case for other forms
of content, but largely not for voice recording.
Following completion of the acquisition, the Company focused on a broad range of opportunities that exist within the
business and enterprise markets through highly targeted global networks. Management prioritised leveraging pre-
existing sales, deployment and technology providers to optimise the Company’s growth. The priority distribution
networks targeted by Dubber were direct sales, agent, reseller and distributors, platform
integration,
telecommunication networks and open API.
The Company announced several key partnerships with telecommunications network providers including Inference
Solutions and Broadsoft. The partnership with Broadsoft included interoperability testing and accreditation, enabling
telecommunications service providers to integrate Dubber’s call recording platform into their existing Broadsoft
software without needing additional hardware..
Dubber was the Platinum Sponsor at the Broadsoft Customer and Technical Summits which were held in Melbourne,
Hong Kong, Warsaw and Johannesburg
2015 has marked a very exciting change in direction for the Company. On behalf of the Board, I would like to thank all
staff and contractors for their contribution to the continuing development of the Company. I would also like to thank
our shareholders for their continued support.
Yours faithfully
Peter Pawlowitsch
Chairman
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Review of Operations
REVIEW OF OPERATIONS
Corporate
March 2015:
The Company sold its interests in its Ivorian subsidiary, which owns all licences in Cote d’Ivoire, for a
nominal sum, saving the cost associated with the relinquishing of licences and closing local
subsidiaries. The Company also advised its joint venture partner on the Poya Project in Burkina Faso
that it has withdrawn from the joint venture with title handed back to the joint venture partner.
The Company completed all matters required for the acquisition of Dubber Pty Ltd in March 2015.
This included a Prospectus to raise $4,676,020 and the issue of 23,383,100 ordinary 20 cent shares.
The Company welcomed Mr Steve McGovern and Mr Gavin Campion as directors and Mr Simon
Coxhell resigned as director.
January 2015
The Company lodged a re-compliance prospectus for the purpose of satisfying Chapters 1 and 2 of
the Listing Rules and to satisfy ASX requirements for re-admission to the Official List following a
change to the nature and scale of the Company’s activities. This prospectus included an offer of
20,000,000 Shares at an issue price of $0.20 per Share to raise $4,000,000 (before expenses of the
offer), with the ability to take oversubscriptions of 5,000,000 Shares to raise a further $1,000,000
for a total raising of up to $5,000,000.
December 2014 Approval for the acquisition of Medulla Group Pty Ltd, consolidation of the issued capital on a 5 to 1
basis and change of name from Crucible Gold Limited to Dubber Corporation Limited, amongst
others.
October 2014
Mr Tim Fry and Michel Mian resigned as directors of the Company.
September 2014 Dubber achieved its first acquisition performance milestone of 1,000 paying end users resulting in
20,484,882 (4,097,005 post-consolidation) Performance Shares being issued.
June 2014
The Company advised that due diligence pertaining to the Dubber acquisition was completed. The
Company then moved to complete a capital raising via the issue of 3.9m shares at 2.5 cents to raise
$97,500. 2 for 1 renounceable rights issue at 2.5 cents completed with shortfall oversubscribed,
raising approximately $1,500,000.
Business Operations
Overview
The market had been increasingly challenging for listed, Australian junior resource companies, particularly for those
with assets in West Africa. This prompted the Company to investigate alternate opportunities in other sectors. In April
2014 the Company announced a transaction with an Australian technology company, Medulla Group Pty Ltd
(“Medulla”) to acquire a transformative Cloud based call recording software technology.
Dubber is a software technology suite in a multi-billion dollar hardware centric market place. It provides enhanced
service at a fraction of the cost base and is flexible to a myriad of applications, not easily achievable with current
market solutions. These benefits include immediate access to the call recording at any time from any location and the
ability to asset manage and utilise recordings within existing enterprise systems as is the case for other forms of
content, but largely not for voice recording.
The browser-based technology will include cheap IP (internet protocol) based telephone calls/recording and a
‘freemium’ to subscription business model. It is available in a scalable enterprise platform with promising early
domestic sales and a future plan to internationalise through a system of integration/consultancy firms plus distribution
and resellers.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
REVIEW OF OPERATIONS
A primary focus for Dubber throughout the year has been the delivery of its products through various sales channels,
including telecommunication companies.
Background on Dubber
The Dubber Platform provides call recording and audio asset management in the cloud.
Dubber is a transformative Cloud based Software-as-a-Service (SaaS) solution in a multi-billion dollar hardware centric
market place. It provides enhanced service and is flexible to a myriad of requirements not easily achievable with
current market solutions.
The Dubber Platform:
Captures call recordings from many sources including from browsers, mobile, private automatic branch
exchange (PABX), hosted voice applications and legacy recording devices.
Manages recordings in a secure, permission-based environment. Call recordings are immediately searchable
and accessible from any location via a web browser. Dubber has market leading scalability both in terms of
concurrent recording and storage.
Provides value added tools enabling the use of recordings to enhance existing business systems and processes.
Recording will be available across all devices and is instantly accessible for many and varied User
requirements.
The Dubber Platform is a Native Cloud product delivering secure, scalable and robust functionality at a significant
saving compared to the cost base normally associated with traditional call recording offerings.
Dubber is a classic transformation of a traditional hardware/software market to a Cloud based platform, which delivers
many competitive advantages to the Dubber Platform, as set out below:
Is a Native Cloud product built to quickly scale around the Amazon Web Services (AWS) global Cloud
infrastructure.
Has a multi-tenant architecture providing the ability to support a complex channel sales model. This provides
the Dubber Platform with the ability to separately manage accounts and Users, all with potentially unique
subscription, permissions, sales rules, etc via a single scalable global platform.
Key functionality is available to developers and integrators through open Application Programme Interfaces
(APIs).
Has built its own end-to-end scalable Cloud telephony platform, which enables the User to make and record a
call instantly, without downloading any software, plug-ins or authentication tools.
Enables all Users to record calls made via on-premise internet protocol (IP) PABXs, hosted phone systems or
enhancing legacy recording solutions.
Is available on multiple communication devices both as the source of recording and for playback and retrieval.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
REVIEW OF OPERATIONS
The view of Dubber’s management is that key benefits of using the Dubber Platform are:
scalable on demand which impacts the customer experience and cost profile;
deployable internationally in line with AWS global infrastructure;
centralising all recordings from all disparate devices, platforms, locations or systems into one highly functional
platform;
instant playback and management of the recording asset including permanent availability for such functionality;
use of metadata for Big Data applications, for example key word search/ analytics and work flow optimisation;
capture inbound and outbound calls with functionality that would not normally be available for recording by
traditional solutions;
there is no reliance on traditional storage infrastructure either at the customer’s premises or in a data centre;
and
OPEX rather than CAPEX pricing structure due to SaaS subscription model.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Business Activities
REVIEW OF OPERATIONS
Following the successful acquisition of Dubber, the Company has focussed on forging partnerships with
telecommunication carrier networks.
In March 2015 Dubber announced a partnership with Inference Solutions, as part of the Company’s strategy to
integrate Dubber into telecommunications service providers at a network level.
Inference Solutions is a world leader in advanced IVR and call automation technologies for carriers, large enterprises
and Business Process Outsourcing.
The Dubber platform has been integrated into Inference’s Studio platform for the seamless and rapid deployment of
voice automation solutions that require call recording. Through this partnership, Inference will resell Dubber’s call
recording platform via their existing and new channels to service provider and enterprise clients in Australia and
internationally.
In May, Dubber completed an interoperability program with Broadsoft, a leading provider of software and services
that enable mobile, fixed-line and cable service providers to offer Unified Communications over Internet Protocol
networks. The interoperability enables telecommunications service providers to integrate Dubber’s call recording
platform into their existing Broadsoft software without needing additional hardware.
During the year, Dubber was a Platinum Sponsor at the Broadsoft Customer and Technical Summits which were held in
Melbourne, Hong Kong, Warsaw and Johannesburg. The Company was able to demonstrate how it enables
telecommunications carrier networks to connect call recording onto its network within hours at no cost and is
minimally disruptive. Traditionally, telecommunication networks connecting to call recording across their network had
to invest significant capital expenditure for hardware licences, productisation and commitment to support
infrastructure.
In July, Dubber announced it had released ‘Dubber Lab’ for Broadsoft partners. Essentially, the Dubber Lab enables
telecommunications and service providers to connect to the Dubber platform within hours for testing and migrate
seamlessly into a production environment without traditional technical hurdles or requirements.
Dubber’s success in attracting partnerships with industry leaders culminated in August with Dubber announcing it had
entered into a Reseller Agreement with Gateway ICT Pty Ltd (Gateway ICT). Gateway ICT is a Cisco Platinum Partner
and will directly resell Dubber’s call recording system to customers as additional service to their Telstra Bill.
Steve McGovern, CEO of Dubber, said ‘As an experienced Telstra Enterprise Partner, Gateway ICT will be capable of
introducing Dubber to the Telstra sales team and this will enable Dubber services to appear on the Telstra bill’.
The Cisco customer base had always been a priority in Dubber’s Business and Enterprise strategy, and the technology
has been designed with that channel in mind as it provides for a truly global opportunity.
In September 2015, Dubber became available in the UK and European markets opening up a revolutionary way in
which telecommunications carriers can supply call recording and associated technologies to their customer base.
The release into these markets was a result of European Broadsoft roadshow. Dubber advised that a number of other
prominent telecos had engaged in the testing process. The Euopean market was a key target for Dubber and this
release is a likely first step which the Company hopes will see re-sellers and telco partners providing Dubber recording
on a previously unmatched scale. This will be made possible through the software being available in German, Polish,
Dutch, French, Spanish and Portuguese to meet service levels of potential customers.
In the same period, Dubber continued to succeed in Australian markets with the Company exceeding the performance
milestone of 3,000 paying users for the initial vendors of the Dubber business.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Exploration Activities
Poya Project, Burkina Faso
REVIEW OF OPERATIONS
Prior to the acquisition of Dubber, the Company (formerly Crucible Gold) owned an 88.89% interest in the Poya Gold
Exploration Licence covering 111 square kilometres of prospective Birimian volcanic ground. During the year, prior to
disposal of this asset, the Company investigated a number of private and public potential joint venture partners,
consistent to the Company’s earlier business strategy.
In March 2015 the Company advised its partner on the Poya Project in Burkina Faso that the Company had withdrawn
from the joint venture with title handed back to the joint venture partner.
Aboisso and Bodite Projects, Cote d’Ivoire
The Company was granted the Aboisso licence in May 2014 with exploration activities continuing soon after the legal
granting of this licence.
The Company collected 151 soil samples at its Aboisso licence in eastern Cote d’Ivoire immediately adjacent to the
Ghanian border. Samples were submitted to Bureau Veritas laboratory for low level gold analysis however results
returned a maximum gold value of 22 part per billion (ppb) which is not considered significant.
Following the insignificant results returned by exploration activities conducted during the year, in March 2015 the
Company announced it had sold its Ivorian subsidiary which owned the Bodite and Aboisso licences in Cote d’Ivoire.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Directors’ Report
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Your directors present their report of Dubber Corporation Limited and its controlled entities (the Group) for the
financial year ended 30 June 2015.
Directors
The names of the directors of the Company in office during the financial year and up to the date of this report are as
follows:
Steve McGovern
Peter Pawlowitsch
Gavin Campion
Ken Richards
Simon Coxhell
Tim Fry
Michel Mian
Managing Director (appointed 2 March 2015)
Non-executive Chairman
Non-executive Director (appointed 2 March 2015)
Non-executive Director
Executive Technical Director (resigned 2 March 2015)
Chairman (resigned 20 October 2014)
Non-executive Director (resigned 20 October 2014)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
The particulars of the qualifications, experience and special responsibilities of each Director are as follows:
Mr Steve McGovern
Managing Director (appointed 2 March 2015)
Experience
Steve McGovern is a founder of Dubber Pty Ltd. He has over 23
years experience in the fields of telecommunications, media sales,
pay TV and regulatory. Mr McGovern has been a senior executive
of several established companies, both domestically and
internationally, which have been primarily associated with new
and emerging markets and have required a strong sales and
solutions focus.
Interest in Shares and Options
at the date of this report
3,466,124 ordinary shares
3,541,347 vendor performance shares
1,200,000 performance options
800,000 performance shares
All shares and options are held indirectly.
Directorships held in other listed entities during
the three years prior to the current year
Mr McGovern has not been a director of any ASX listed company in
the past three years
Mr Peter Pawlowitsch
Non-executive Chairman
Experience
Mr Pawlowitsch holds a Bachelor of Commerce from the
University of Western Australia, is a current member of the
Certified Practising Accountants of Australia and also holds a
Master of Business Administration from Curtin University.
These qualifications have underpinned more than twelve years’
experience in the accounting profession and more recently in
business management and the evaluation of businesses and
mining projects.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Interest in Shares and Options
at the date of this report
Directorships held in other listed entities during
the three years prior to the current year
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
270,000 ordinary shares
200,000 unlisted options
600,000 performance options
400,000 performance shares
All shares and options are held indirectly
Mr Pawlowitsch is a director of:
Ventnor Resources Limited
Kunene Resources Limited
Knosys Limited
Mr Gavin Campion
Non-executive Director (appointed 2 March 2015)
Experience
Interest in Shares and Options
at the date of this report
Gavin Campion is a start-up and turnaround entrepreneur and
operator in Cloud based technology markets. He has acted as CEO
and/or founded a number of successful digital services and
technology companies. Mr Campion has an honours degree in
marketing from the UK.
1,000,000 ordinary shares
3,000,000 management performance shares
150,000 performance options
100,000 performance shares
All shares and options are held indirectly.
Directorships held in other listed entities during
the three years prior to the current year
Mr Campion is a director of:
Knosys Limited
Mr Ken Richards
Experience
Non-executive Director
Mr Richards has in excess of 25 years’ experience as a Managing
Director in various companies listed and unlisted and in various
industries. He holds a Bachelor of Commerce and Master of
Business Administration degrees from the University of Western
Australia and is a fellow of the Australian Institute of Company
Directors.
Interest in Shares and options
at the date of this report
645,776 ordinary shares held indirectly
200,000 unlisted options held directly
150,000 performance options held indirectly
100,000 performance shares held indirectly
Directorships held in other listed entities during
the three years prior to the current year
Mr Richards is a director of:
Leaf Energy Limited
Mr Simon Coxhell
Executive Technical Director (resigned 02 March 2015)
Experience
Simon Coxhell is a geologist with a Bachelor of Science and
Masters Qualifying from James Cook University, Townsville. Mr
Coxhell has over 26 years’ experience encompassing all aspects of
the resource sector
including exploration, development and
mining.
Mr Coxhell has evaluated and assessed numerous projects across
many commodities including gold, copper, iron ore, diamonds,
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Interest in Shares and Options
Directorships held in other listed entities during
the three years prior to the current year
Mr Tim Fry
Experience
vanadium ,rare earths, mineral sands, garnet and oil shale. Also
completing many JORC compliant resource estimates for gold,
mineral sands, garnet, rare earths, oil shale and vanadium
resources.
Mr Coxhell has been a member of AUSIMM since 1993.
6,000 ordinary shares held directly
44,000 ordinary shares held indirectly
200,000 unlisted options held directly
Mr Coxhell is a former director of:
Venus Resources Limited
Navigator Resources Limited
Cohiba Minerals Limited
Chairman (resigned 20 October 2014)
Mr Fry was formerly Executive General Manager – West Africa for
Lihir Gold Ltd, an ASX listed gold producer with annual production
in excess of 1 million ounces and operations in Australia, Papua
New Guinea and Cote d’Ivoire. In his role as Executive General
Manager with Lihir, Mr Fry had responsibility for operations,
in the region and a significant gold
business development
in excess of US$30 million. He
exploration programme
subsequently held a key leadership role as part of the integration
team following the Lihir merger with Newcrest Mining Ltd in mid
2010.
Prior to joining Lihir, Mr Fry was President of Dyno Nobel Asia
Pacific (2002-2008), a company he had been with since 1992. As
part of Dyno Nobel’s global management team he played an
integral role in steering the company through European private
equity ownership, sale to a Macquarie Bank lead consortium in
2005, listing on the ASX in early 2006 to the subsequent sale of the
business to Incitec Pivot Ltd in June 2008. Mr Fry has extensive
experience
in the mining, resources and civil engineering
industries and has a B. Eng (Hons) degree in Mining, ACSM,
MAICD.
Interest in Shares and Options
160,000 ordinary shares held directly
30,000 ordinary shares held indirectly
200,000 unlisted options held directly
Directorships held in other listed entities during
the three years prior to the current year
Mr Fry has not been a director of any ASX listed company in the
past three years
Mr Michel Mian
Experience
Non-Executive Director (resigned 20 October 2015)
Mr Mian is an Economist by training, and has been involved in the
exploration & mining sector from 1996 to 2009, first with Equigold
Cote d’Ivoire as President Director General & Chairman of the
board. Mr Mian played a key role in securing the significant land
package for Equigold (in excess of 18,000 km2) and the
subsequent discovery of the 2.9 MOz, Bonikro deposit. From 2009
to 2010 Mr Mian was President of Lihir Gold Cote d’Ivoire and
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
following the merger of Lihir Gold Ltd and Newcrest Mining Ltd,
Mr Mian took on the role as President of Newcrest Cote d’Ivoire
from September 2010 to December 2011. Newcrest Mining Ltd,
presently now operates the Bonikro mine and has an extensive
exploration programme in the country.
Mr Mian has been awarded the following honorific medals for his
community and business services:
Gold Medal for the Best African Manager in Madrid in 2006;
Gold Medal for the award 2007 at Meridian Hotel in Paris; his
company has been granted the award for the excellence of service
quality.
Officer of National Order of Cote d’Ivoire by his Excellency the
Head of State for services rendered to Cote d’Ivoire.
Interest in Shares and Options
50,000 ordinary shares
200,000 unlisted options
All shares and options are held directly
Directorships held in other listed entities during
the three years prior to the current year
Mr Mian has not been a director of any ASX listed company in the
past three years.
Company Secretary
Mr Ian Hobson was appointed as Company Secretary on 17 October 2011 and holds a Bachelor of Business degree and
is a Chartered Accountant and Chartered Secretary. Mr Hobson provides company secretary services and corporate,
management and accounting advice to a number of listed public companies.
Principal Activities
The principal activities of Dubber Corporation Limited and its controlled entities consisted of provision of call recording
and audio asset management in the cloud.
Operating Results
The loss from ordinary activities after providing for income tax amounted to $3,535,621 (2014: $950,999).
Review of Operations
A review of operations for the financial year and the results of those operations is contained within the review of
operations preceding this report.
Dividends Paid or Recommended
No dividends were paid or declared since the start of the financial year. No recommendation for payment of dividends
has been made.
Financial Position
At 30 June 2015 the Group had net assets of $10,079,635 (2014: $1,732,554) and cash reserves of $1,697,415 (2014:
$1,119,997).
Significant Changes in State of Affairs
Significant changes in the state of affairs of the Company during the financial year are detailed in the review of
operations.
In the opinion of the directors, there were no other significant changes in the state of affairs of the Company that
occurred during the financial year under review not otherwise disclosed in this report or in the financial statements.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Matters Subsequent to Balance Date
No matters or circumstances have arisen, since the end of the financial year, which 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
subsequent financial years, other than as follows.
The Company announced on 2 September 2015 that the Group has registered 3,307 paying users as at 25 August 2015,
confirming the passing of the performance milestone of 3,000 paying users for the initial vendors of the Dubber
business. The Company also confirmed that the signing of the Go Cloud Master Distributer Agreement to establish a
re-seller network across Asia, was the final requirement in the first tranche of Management performance shares held
by Mr Gavin Campion, a director of the Company. Full details of all performance shares are set out in the Company’s
Prospectus dated 15 January 2015.
A fully paid ordinary share was issued for converting and cancelling each of the following performance shares upon
achieving the above performance milestones:
3,892,127 milestone 2 performance shares held by the vendors of Medulla Group Pty Ltd;
204,818 milestone 2 performance shares held the vendor’s advisors; and
1,000,000 milestone 1 Management performance shares held by Mr Gavin Campion.
Likely Developments and Expected Results of Operations
The Group will continue to pursue its principal activity of rolling out and developing its cloud based call recording and
audio asset management platform.
Environmental Regulations
The Group is not currently subject to any specific environmental regulation under Australian Commonwealth or State
law.
Meetings of Directors
The numbers of meetings of directors held during the year and the numbers of meetings attended by each director
were as follows:
Number eligible to attend
Number attended
Directors' Meetings
Mr Steve McGovern (appointed 2 March 2015)
Mr Peter Pawlowitsch
Mr Gavin Campion (appointed 2 March 2015)
Mr Ken Richards
Mr Simon Coxhell (resigned 2 March 2015)
Mr Tim Fry (resigned 20 October 2014)
Mr Michel Mian (resigned 20 October 2014)
1
3
1
3
2
1
1
1
3
1
3
2
-
1
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
REMUNERATION REPORT (Audited)
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
The remuneration report details the key management personnel remuneration arrangements for the consolidated
entity, in accordance with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and
controlling the activities of the entity, directly or indirectly, including all directors.
The following persons were directors of Dubber Corporation Limited during the financial year:
Steve McGovern
Peter Pawlowitsch
Gavin Campion
Ken Richards
Simon Coxhell
Tim Fry
Michel Mian
Managing Director (appointed 2 March 2015)
Non-executive Chairman
Non-executive Director (appointed 2 March 2015)
Non-executive Director
Executive Technical Director (resigned 2 March 2015)
Chairman (resigned 20 October 2014)
Non-executive Director (resigned 20 October 2014)
Other persons that fulfilled the role of a key management person during the year, are as follows:
James Slaney
Chris Jackson
Adrian Di Pietrantonio
General Manager (appointed 2 March 2015)
Chief Technology Officer (appointed 2 March 2015)
General Manager, Channels (appointed 2 March 2015)
Overview of remuneration policies
The Board as a whole is responsible for considering remuneration policies and packages applicable both to Directors
and executives of the Company and the Consolidated Entity.
Key management personnel have authority and responsibility for planning, directing and controlling the activities of the
Company and the Consolidated Entity, including Directors of the Company and other executives. Key management
personnel comprise the Directors of the Company, and executives for the Company and the Consolidated Entity
including the key management personnel.
Broadly, remuneration levels for key management personnel of the Company and key management personnel of the
Consolidated Entity are competitively set to attract and retain appropriately qualified and experienced Directors and
executives and reward the achievement of strategic objectives. The Board obtains independent advice on the
appropriateness of remuneration packages of both the Company and the Consolidated Entity given trends in
comparative companies both locally and internationally, and the objectives of the Company’s remuneration strategy.
Remuneration packages consist of fixed remuneration including base salary, employer contributions to superannuation
funds and non-cash benefits.
The Company has a variable remuneration package for Directors, which involves Performance Shares. This plan allows
Directors to convert Performance Shares to fully paid ordinary shares for nil cash consideration, subject to performance
based vesting conditions.
Discretionary bonuses were paid to Mr James Slaney and Mr Adrian Di Pietrantonio of $13,333 each.
Fixed remuneration
Fixed remuneration consists of base remuneration (which is calculated on a total cost basis and includes any FBT
charges related to employee benefits including motor vehicle), as well as employer contributions to superannuation
funds.
Remuneration levels are reviewed annually by the Board through a process that considers individual, segment and
overall performance of the Consolidated Entity. The Board has regard to remuneration levels external to the
Consolidated Entity to ensure the Directors’ and executives’ remuneration is competitive in the market place.
Annual Report - 30 June 2015
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DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Executive Directors are employed full time and receive fixed remuneration in the form of salary and statutory
superannuation or consultancy fees, commensurate with their required level of services.
Non-Executive Directors receive a fixed monthly fee for their services. Where Non-Executive Directors provide services
materially outside their usual Board duties, they are remunerated on an agreed retainer or daily rate basis.
Service agreements
It is the Consolidated Entity’s policy that service agreements for key management personnel are unlimited in term but
capable of termination on 3 months’ notice and that the Consolidated Entity retains the right to terminate the service
agreements immediately, by making payment equal to 3 months’ pay in lieu of notice.
The service agreement outlines the components of compensation paid to key management personnel but does not
prescribe how remuneration levels are modified year to year. Remuneration levels are reviewed annually on a date as
close as possible to 30 June of each year to take into account key management personnel’s performance.
Certain key management personnel will be entitled to bonuses as the Board may decide in its absolute discretion from
time to time, to a maximum of 50% of the key management personnel’s annual base salary per annum.
Non-Executive Directors
Total remuneration for all Non-Executive Directors, last voted upon by shareholders at the 2012 Annual General
Meeting, is not to exceed $250,000 per annum and has been set at a level to enable the Company to attract and retain
suitably qualified Directors. The Company does not have any scheme relating to retirement benefits for Non-Executive
Directors.
Relationship between the remuneration policy and Company performance
The remuneration policy has been tailored to increase goal congruence between shareholders, Directors and
executives. Two methods have been applied to achieve this aim, the first being a performance-based rights subject to
performance based vesting conditions, and the second being the issue of options or shares to key management
personnel to encourage the alignment of personal and shareholder interests.
Share-based payment arrangements
Options
The Company operates an Employee Share Option Plan (“ESOP”) for executives and senior employees of the
Consolidated Entity. In accordance with the provisions of the ESOP, executives and senior employees may be granted
options to purchase ordinary shares at an exercise price to be determined by the Board with regard to the market
value of the shares when it resolves to offer the options. The options may only be granted to eligible persons after the
Board considers the person’s seniority, position, length of service, record of employment, potential contribution and
any other matters which the Board considers relevant.
Each employee share option converts into one ordinary share of the Company on exercise. No amounts are paid or
payable to the Company by the recipient on receipt of the option. The options carry neither rights to dividends nor
voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry.
The number of options granted is determined by the Board.
To date, options granted under the ESOP expire within thirty six months of their issue, or immediately on the
resignation of the executive or senior employee, whichever is the earlier.
Annual Report - 30 June 2015
Page 15
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Employment Details of Directors and other Key Management Personnel
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
Details of these agreements are as follows:
Steve McGovern
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
Peter Pawlowitsch
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
Gavin Campion
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
Ken Richards
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
Managing Director
Executive service agreement (MD Agreement)
2 March 2015
No fixed term
Annual salary of $240,000 plus statutory superannuation
During the first 6 months of the MD Agreement, the Company may terminate the
agreement on 3 months notice, or by providing a cash payment in lieu of such notice
equal to the salary payable for the remainder of the first 6 months of the MD Agreement
(subject to the limitation of the Corporations Act and Listing Rules). After this, the
Company may terminate the agreement on 3 months notice.
Non-executive Chairman
Letter of appointment
1 December 2014
No fixed term
Annual fee of $76,650 (inclusive of statutory superannuation) plus reimbursement of all
reasonable expenses incurred in performing the Chairman’s duties
In the event Peter is removed as a director by shareholders under the Corporations Act or
Constitution, or is unable to perform his duties, he is entitled to receive a termination
payment of 3 months worth of his director’s fee (subject to the limitation of the
Corporations Act and Listing Rules).
Non-executive Director
Non-executive and consultancy service agreement for services as a non-executive
director and consultant
2 March 2015
No fixed term
nil director’s fees are payable;
a consultancy fee of $219,000 per annum (plus GST); and
4 million Management Performance Shares which are exercisable into Shares in the
Company upon the Management Performance Milestones
The parties may terminate the Consultancy Agreement by giving 3 months notice (or
payment in lieu of such notice on the part of the Company). In the event the Consultancy
Agreement is terminated, Gavin is entitled to payment of any outstanding amounts
owing up to the date of termination, not including any unexpired term of the Consultancy
Agreement (subject to the limitation of the Corporations Act and Listing Rules).
Non-executive Director
Letter of appointment
1 December 2014
No fixed term
Annual fee of $40,000 (inclusive of statutory superannuation) plus reimbursement of all
reasonable expenses incurred in performing the Non-executive Director’s duties
In the event Ken is removed as a director by shareholders under the Corporations Act or
Constitution, or is unable to perform his duties, he is entitled to receive a termination
payment of 1 months worth of his director’s fee (subject to the limitation of the
Corporations Act and Listing Rules).
Annual Report - 30 June 2015
Page 16
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
James Slaney
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
General Manager
Executive service agreement (GM Agreement)
2 March 2015
Same terms as termination notice below:
Annual salary of $200,000 plus statutory superannuation
Until the earlier of achievement of all the Vendor Performance Milestones or the first 27
months of the GM Agreement, the Company may terminate the agreement on 3 months
notice, or by providing a cash payment in lieu of such notice equal to the salary payable
for the remainder of the first 27 months of the GM Agreement. After this, the Company
may terminate the agreement on 3 months notice.
Chris Jackson
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
Chief Technology Officer
Employment agreement (CTO Agreement)
2 March 2015
No fixed term
Annual salary of $180,000 plus statutory superannuation
Standard 4 week notice periods for termination apply to the CTO Agreement in
accordance with statutory requirements.
Adrian Di Pietrantonio
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
General Manager, Channels
Executive service agreement (GMC Agreement)
2 March 2015
Same terms as termination notice below:
Annual salary of $165,000 plus statutory superannuation
Until the earlier of achievement of all the Vendor Performance Milestones or the first 27
months of the GMC Agreement, the Company may terminate the agreement on 3
months notice, or by providing a cash payment in lieu of such notice equal to the salary
payable for the remainder of the first 27 months of the GM Agreement. After this, the
Company may terminate the agreement on 3 months notice.
Annual Report - 30 June 2015
Page 17
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Details of Remuneration for Year
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Details of the remuneration of each Director and named executive officer of the company, including their personally-related entities, during the year was as follows:
Director
Executive Directors:
S McGovern
(appointed 2/3/15)
Non-Executive Directors:
P Pawlowitsch
G Campion
(appointed 2/3/15)
K Richards
S Coxhell
(resigned 2/3/15)
T Fry
(resigned 20/10/14)
M Mian
(resigned 20/10/14)
Other Key Management Personnel:
J Slaney
(appointed 2/3/15)
C Jackson
(appointed 2/3/15)
A Di Pietrantonio
(appointed 2/3/15)
Total
Annual Report - 30 June 2015
Year
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
2015
2014
Short Term Benefits
Long Term
Benefits
Post-
Employment
Share Based
Payments
Salary and
fees
$
Cash Bonus
$
Annual
Leave
$
Superannuati
on
$
Options/
Shares
$
Remuneration
consisting of
options/shares
%
Remuneration
based on
performance
%
Total
$
80,000
-
56,054
74,755
73,333
-
75,476
31,667
32,466
89,833
5,000
33,750
1,693
23,417
66,667
-
60,310
-
55,000
-
505,999
253,422
-
-
-
-
-
-
-
-
-
-
-
-
-
-
13,333
-
-
-
13,333
-
26,666
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2,400
-
4,632
-
710
-
7,742
-
7,600
-
5,325
2,209
-
-
2,024
1,927
1,659
1,233
475
3,122
-
-
6,333
-
5,948
-
5,225
-
8,569
-
96,169
-
4,285
18,270
264,563
-
1,071
18,270
-
18,270
-
18,270
-
18,270
2,142
-
1,071
-
1,071
-
65,664
95,234
337,896
-
78,571
51,864
34,125
109,336
5,475
55,142
1,693
41,687
90,875
-
71,961
-
75,339
-
34,589
8,491
282,772
91,350
857,768
353,263
9
-
7
19
78
-
1
35
-
17
-
33
-
44
2
-
2
-
1
-
33
26
9
-
7
-
78
-
1
-
-
-
-
-
-
-
2
-
2
-
1
-
33
-
Page 18
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Compensation Securities Issued to Key Management Personnel
Performance Options:
During the year the following performance options were granted as performance linked incentives to Directors and
Executives. The options were issued free of charge. Each option entitles the holder to subscribe for one fully paid
ordinary share in the Company, exercisable when performance milestones are achieved, at an exercise price of $0.40
per option on or before 30 June 2018.
Key Management
Personnel
Number
granted
S McGovern
1,200,000
P Pawlowitsch
G Campion
K Richards
J Slaney
C Jackson
A Di Pietrantonio
600,000
150,000
150,000
300,000
150,000
150,000
Total
2,700,000
No. vested
during the
period
Grant date
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
-
-
-
-
-
-
-
-
Average
Value per
option at
grant date
$
$0.1635
$0.1635
$0.1635
$0.1635
$0.1635
$0.1635
$0.1635
Exercise
price
$
$0.40
$0.40
$0.40
$0.40
$0.40
$0.40
$0.40
Vested and
Exercisable
-
-
-
-
-
-
-
-
Last
exercise
date
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
The total value of the options at grant date was $441,450. Fair values at grant date was determined using a hybrid up
and in option pricing model. The vesting of the options is dependent on the achievement of performance milestones,
the timing of which is uncertain. The value of the options have been allocated over the assumed vesting period of the
option’s expiry period of three years. At 30 June 2015, $8,299 (approximately 2% of the total value of the options at
grant date), assessed as vested is included in the remuneration table above.
All options issued to Directors in 2014 were not performance based and vested immediately upon issue.
Performance Shares:
During the year the following performance shares were granted as performance linked incentives to Directors and
Executives. The performance shares were issued free of charge. Each performance share converts into one fully paid
ordinary share in the Company for nil cash consideration, upon the achievement of performance milestones, expiring
30 June 2018.
Key Management
Personnel
Number
granted
No. vested
during the
period
Grant date
S McGovern
P Pawlowitsch
G Campion
K Richards
J Slaney
C Jackson
A Di Pietrantonio
800,000
400,000
100,000
100,000
200,000
100,000
100,000
Total
1,800,000
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
9/06/15
-
-
-
-
-
-
-
-
Average
Value per
share at
grant date
$
$0.3245
$0.3245
$0.3245
$0.3245
$0.3245
$0.3245
$0.3245
Vested and
Convertible
Last
conversion
date
-
-
-
-
-
-
-
-
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
30/06/18
The total value of the performance shares at grant date was $584,100. Fair values at grant date was determined using
a hybrid up and in option pricing model. The conversion of the performance shares is dependent on the achievement
of performance milestones, the timing of which is uncertain. The value of the performance shares have been allocated
over their expiry period of three years. At 30 June 2015, $10,982 (approximately 2% of the total value of the
performance shares at grant date), is included in the remuneration table above.
Annual Report - 30 June 2015
Page 19
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Management Performance Shares:
On 28 November 2014, Shareholders approved the issue of 4,000,000 performance shares to Mr Gavin Campion
pursuant to the terms of his non-executive services and consultancy agreement. Each performance share is convertible
into one fully paid ordinary share in the Company upon the achievement of certain milestones being met. These
performance shares were valued at $560,000. The value of the performance shares have been allocated over the
periods each milestone is expected to be met or over the period to their expiry date of 27 May 2017. At 30 June 2015,
$263,491 (47% of the total value at grant date) has been allocated and included in Mr Campion’s remuneration in the
remuneration table above.
Shares Issued to Key Management Personnel on Exercise of Compensation Options
No shares were issued to directors on exercise of compensation options during the year.
Voting and comments made at the company’s 2014 annual general meeting (‘AGM”)
At the 2014 AGM, 100% of the votes received supported the adoption of the remuneration report for the year ended
30 June 2014. The company did not receive any specific feedback at the AGM regarding its remuneration practices.
Loans with Key Management Personnel
There were no loans to key management personnel or their related entities during the financial year.
Other Transactions with Key Management Personnel
Payments totalling nil (2014: $7,500) were paid to Avitus Capital Ltd, a company associated with Mr Pawlowitsch, for
consulting fees (not provided by Mr Pawlowitsch).
Payments totalling $17,482 (2014: $39,275) were paid to Ventnor Resources Ltd (a company associated with Mr
Pawlowitsch) for rent for the Company’s former offices in West Perth and shared expenses.
The Company paid an amount of nil (2014: $3,486) to TD Continental (a company associated with Mr Mian) for field
staff.
Payments totalling $47,143 (2014: nil) were made to Prueba Pty Ltd, a company associated with Mr Steve McGovern,
for platform testing consulting fees during the four months period since acquiring the Dubber business.
Intelligent Voice and 1300 MY SOLUTION are businesses associated with Mr Steve McGovern and Mr Adrian Di
Pientrantonio. The Group earned service fee income of $7,260 from Intelligent Voice and $51,327 from 1300 MY
SOLUTION during the four months since acquiring the Dubber business. Trade receivables at 30 June 2015 include
balances of $18,518 due from Intelligent Voice and $57,095 due from 1300 MY SOLUTION. $28,460 was paid by 1300
MY SOLUTION during the year to the Company.
The Company entered into sub-underwriting agreements for the renounceable rights share issue completed during the
previous financial year, with entities associated with two of its Directors. Coxrocks Pty Ltd (a company associated with
Mr Coxhell) and Kellen Investments Pty Ltd (a company associated with Mr Richards), as sub-underwriters, subscribed
for shares to the value of $4,500 and $65,000 respectively. The sub-underwriters received no fees for acting as sub-
underwriters.
During the year, Vault Pty Ltd, a company associated with Mr Pawlowitsch advance a short term loan of $50,000 to the
Company in January 2015. This amount was repaid in March with interest of $7,500.
Balances in trade creditors at 30 June 2015, include the amounts of $10,323 Mr Adrian Di Pietrantonio and $ 1,880 for
Mr James Slaney.
Amounts included in the remuneration table for Mr Gavin Campion and Mr Simon Coxhell were paid to their
consultancy companies Hydrya Plenus Pty Ltd and Coxrocks Pty Ltd respectively.
All transactions are conducted on normal commercial terms and on an arm’s length basis.
Annual Report - 30 June 2015
Page 20
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Additional Disclosures Relating to Key Management Personnel
Shareholdings
The number of shares in the Company held during the financial year by each Director and other members of key
management personnel of the Consolidated Entity, including their personally related parties, is set out below:
Director
S McGovern
(appointed 2/3/15)
P Pawlowitsch
G Campion
(appointed 2/3/15
K Richards
S Coxhell
(resigned 2/3/15)
T Fry
(resigned 20/10/14)
M Mian
(resigned 20/10/14)
J Slaney
(started 2/3/15)
C Jackson
(started 2/3/15)
A Di Pietrantonio
(started 2/3/15)
Balance at
Beginning
of Year
-
1,350,000
-
3,228,880
250,000
950,000
250,000
-
-
-
6,028,880
Received as
Remuneration
Options
Exercised
Acquired/
(disposed)
Net Change
Other
Balance at
End of Year
d) 1,035,163
-
b) 1,395,798
2,430,961
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
d) 798,842
d) 194,577
d) 828,382
c) (1,080,000)
-
-
-
c) (2,583,104)
c) (200,000)
-
a) (50,000)
270,000
-
645,776
-
-
-
-
-
-
-
-
a) (950,000)
a) (250,000)
b) 1,077,147
1,875,989
b) 262,365
456,942
b) 1,116,979
1,945,361
2,856,964
(3,863,104)
2,602,289
7,625,029
a) - Shares held at date of appointment or resignation, as applicable.
b) - Shares issued as part consideration for acquisition of Medulla Group Pty Ltd.
c) - 1:5 consolidation of existing shares and options on 15/12/14.
d) - Vendor performance shares converted on achieving milestone 1.
Annual Report - 30 June 2015
Page 21
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Option Holdings
The number of options over ordinary shares in the Company held during the financial year by each Director and other
members of key management personnel of the Consolidated Entity, including their personally related parties, is set out
below:
Director
S McGovern
(appointed 2/3/15)
P Pawlowitsch
G Campion
(appointed 2/3/15
K Richards
S Coxhell
(resigned 2/3/15)
T Fry
(resigned 20/10/14)
M Mian
(resigned 20/10/14)
J Slaney
(started 2/3/15)
C Jackson
(started 2/3/15)
A Di Pietrantonio
(started 2/3/15)
Balance at
Beginning
of Year
Received as
Remuneration
Options
Expired/
Cancelled
Net Change
Other
Balance at
End of Year
Number
Vested
Number
Exercisable
-
1,200,000
-
3,250,000
600,000
b) (3,050,000)
-
150,000
-
1,000,000
150,000
b) (800,000)
-
-
-
-
2,000,000
1,250,000
1,000,000
-
-
-
-
-
-
300,000
150,000
150,000
b) (1,800,000)
a) (200,000)
(250,000)
a) (1,000,000)
-
-
-
-
a) (1,000,000)
-
-
-
1,200,000
800,000
150,000
350,000
-
-
-
300,000
150,000
150,000
8,500,000
2,700,000
(5,900,000)
(2,200,000)
3,100,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
a) - Options held at date of appointment or resignation, as applicable.
b) - 1:5 consolidation of existing shares and options on 15/12/14.
Annual Report - 30 June 2015
Page 22
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Performance Shares Holdings
The number of performance shares over ordinary shares in the Company held during the financial year by each
Director and other members of key management personnel of the Consolidated Entity, including their personally
related parties, is set out below:
Director
S McGovern
(appointed 2/3/15)
P Pawlowitsch
G Campion
(appointed 2/3/15
K Richards
S Coxhell
(resigned 2/3/15)
T Fry
(resigned 20/10/14)
M Mian
(resigned 20/10/14)
J Slaney
(started 2/3/15)
C Jackson
(started 2/3/15)
A Di Pietrantonio
(started 2/3/15)
Balance at
Beginning
of Year
Received as
Remuneration
Shares
Expired/
Converted
Net Change
Other
Balance at
End of Year
-
-
-
-
-
-
-
-
-
-
-
800,000
b) (1,035,163)
a) 5,611,673
5,376,510
400,000
4,100,000
100,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
400,000
4,100,000
100,000
-
-
-
200,000
b) (798,842)
a) 4,330,566
3,731,724
100,000
b) (194,577)
a) 1,054,811
960,234
100,000
b) (828,382)
a) 4,490,705
3,762,323
5,800,000
(2,856,964)
15,487,755
18,430,791
a) – Performance shares issued as part consideration for acquisition of Medulla Group Pty Ltd.
b) - Vendor performance shares converted on achieving milestone 1.
This is the end of the remuneration report.
Annual Report - 30 June 2015
Page 23
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Indemnifying Officers or Auditors
Dubber Corporation Limited has paid premiums to insure directors against liabilities for costs and expenses incurred by
them in defending legal proceedings arising from their conduct while acting in the capacity of director of Dubber
Corporation Limited, other than conduct involving a wilful breach of duty in relation to Dubber Corporation Limited.
Options
At the date of this report there were the following unissued ordinary shares for which options were outstanding:
1,000,000 unlisted options expiring 25 November 2016, exercisable at $0.25 each
3,000,000 unlisted options expiring 31 January 2018, exercisable at $0.25 each
600,000 unlisted options expiring 27 February 2018, exercisable at $0.25 each
2,250,000 unlisted options expiring 31 March 2019, exercisable at $0.25 each
2,700,000 unlisted performance options expiring 30 June 2018, exercisable at $0.40 each
During the year the following options were issued:
600,000 options expiring 27 February 2018, exercisable at $0.25 each
3,000,000 options expiring 31 January 2018, exercisable at $0.25 each
2,250,000 options expiring 31 March 2019, exercisable at $0.25 each
2,700,000 performance options expiring 30 June 2018, exercisable at $0.40 each
During the year the following options expired:
2,200,000 options exercisable at 40 cents each (pre capital consolidation), expired on 26 September 2014
1,250,000 performance options exercisable at 40 cents each (pre capital consolidation), expired on 26
September 2014
1,000,000 options exercisable at 40 cents each (pre capital consolidation), expired on 13 December 2014
100,000 options exercisable at $2.00 each (post capital consolidation), expired on 23 February 2015
No options were exercised during the year.
Since the end of the financial year, no other options have expired or been issued or exercised.
Performance Shares
At the date of this report there were the following unissued ordinary shares for which performance shares were
outstanding:
13,315,173 Vendors performance shares, expiring 27 May 2017
3,000,000 Management performance shares, expiring 27 May 2017
1,800,000 performance shares, expiring 30 June 2018
During the year the following performance shares were issued:
21,099,427 Vendors performance shares, expiring 27 May 2017
409,696 Vendor’s Advisors performance shares, expiring 27 May 2017
4,000,000 Management performance shares, expiring 27 May 2017
1,800,000 performance shares, expiring 30 June 2018
The following performance shares converted into fully paid ordinary shares during the year:
3,892,127 Vendors performance shares, expiring 27 May 2017
204,878 Vendor’s Advisors performance shares, expiring 27 May 2017
Since the end of the financial year, no performance shares have been issued or expired, while the following
performance shares converted into fully paid ordinary shares:
3,892,127 Vendors performance shares, expiring 27 May 2017
204,818 Vendor’s Advisors performance shares, expiring 27 May 2017
1,000,000 Management performance shares, expiring 27 May 2017
Annual Report - 30 June 2015
Page 24
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Corporate Governance
DIRECTORS’ REPORT
FOR THE YEAR ENDED 30 JUNE 2015
Under ASX Listing Rule 4.10.3 the Company’s Corporate Governance Statement can be located at the URL on the
Company’s website being: https://dubber.net/corporation/policies/
Proceedings on Behalf of the Company
No person has applied for leave of Court to bring proceedings on behalf of Dubber Corporation Limited or intervene in
any proceedings to which Dubber Corporation Limited is a party for the purpose of taking responsibility on behalf of
Dubber Corporation Limited for all or any part of those proceedings.
Dubber Corporation Limited was not a party to any such proceedings during the year.
Non-audit Services
There were no amounts paid or payable to the auditor for non-audit services provided during the year by the auditor
other than those outlined in Note 19 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor’s behalf), is compatible with the general standard of independence for auditors imposed by
the Corporation Act 2001.
The directors are of the opinion that the services as disclosed in Note 19 to the financial statements do not compromise
the external auditor’s independence requirements of the Corporations Act 2001 for the following reasons:
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and
objectivity of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants issued by the Accounting Professional and Ethical Standards Board, including
reviewing or auditing the auditor's own work, acting in a management or decision-making capacity for the company,
acting as advocate for the company or jointly sharing economic risks and rewards.
Auditor's Independence Declaration
The auditor’s independence declaration for the year ended 30 June 2015, as required under section 307C of the
Corporations Act 2001, has been received and is included within the financial report.
Signed in accordance with a resolution of the Board of Directors:
Peter Pawlowitsch
Director
Dated: 30 September 2015
Annual Report - 30 June 2015
Page 25
For personal use only
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
DECLARATION OF INDEPENDENCE BY JARRAD PRUE TO THE DIRECTORS OF DUBBER CORPORATION
LIMITED
As lead auditor of Dubber Corporation Limited for the year ended 30 June 2015, I declare that, to the
best of my knowledge and belief, there have been:
1. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit; and
2. No contraventions of any applicable code of professional conduct in relation to the audit.
This declaration is in respect of Dubber Corporation Limited and the entities it controlled during the
period.
Jarrad Prue
Director
BDO Audit (WA) Pty Ltd
Perth, 30 September 2015
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
For personal use only DUBBER CORPORATION
ABN 64 089 145 424
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2015
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Revenue from continuing operations
Service income
Other revenue from ordinary activities
Expenses
Service platform costs
Consulting fees
Depreciation and amortisation
Directors fees and benefits
Employee benefits expense
Finance costs
Share based payments
Other expenses from ordinary activities
Loss before income tax expense from continuing operations
Income tax expense
Loss after income tax from continuing operations
Loss after income tax from discontinued operations
Loss after income tax expense for the year
Other comprehensive income
Items that may be reclassified to profit or loss
Foreign currency translation differences
Derecognition of foreign currency reserve
Other comprehensive income for the year, net of tax
Note
2 (a)
24
2 (b)
3
18
2015
$
2014
$
RESTATED
62,203
7,416
-
12,733
(319,456)
(246,109)
(313,966)
(271,939)
(594,716)
(122,831)
(515,903)
(883,629)
(3,198,930)
-
(3,198,930)
(336,691)
(3,535,621)
-
(122,615)
(1,405)
(123,710)
-
-
(91,350)
(329,099)
(655,446)
-
(655,446)
(295,553)
(950,999)
(826)
22,793
21,967
2,103
-
2,103
Total comprehensive loss for the year
(3,513,654)
(948,896)
Loss for the year is attributable to:
Owners of Dubber Corporation Limited
Non-controlling interests
Total comprehensive loss for the year is attributable to:
Owners of Dubber Corporation Limited
Non-controlling interests
Total comprehensive loss for the year attributable to owners of
Dubber Corporation Limited arises from:
Continuing operations
Discontinued operations
(3,518,351)
(17,270)
(3,535,621)
(3,496,301)
(17,353)
(3,513,654)
(921,443)
(29,556)
(950,999)
(919,550)
(29,346)
(948,896)
(3,302,471)
(193,830)
(3,496,301)
(645,388)
(274,162)
(919,550)
Annual Report - 30 June 2015
Page 27
For personal use only
DUBBER CORPORATION
ABN 64 089 145 424
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER
COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2015
Earnings per share attributable to the owners of Dubber Corporation
Limited
Loss from continuing operations:
Basic loss per share
Diluted loss per share
Loss from discontinued operations:
Basic loss per share
Diluted loss per share
Loss for the year:
Basic loss per share
Diluted loss per share
Note
2015
Cents
2014
Cents
15
15
15
15
15
15
(10.18)
(10.18)
(1.02)
(1.02)
(11.20)
(11.20)
(2.32)
(2.32)
(0.94)
(0.94)
(3.26)
(3.26)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction
with the accompanying notes.
Annual Report - 30 June 2015
Page 28
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2015
Consolidated Statement of Financial Position
ASSETS
Current Assets
Cash and cash equivalents
Trade and other receivables
Other assets
Total Current Assets
Non-Current Assets
Property, plant and equipment
Intangible assets
Total Non-Current Assets
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Provisions
Total Current Liabilities
Total Liabilities
NET ASSETS
EQUITY
Issued capital
Reserves
Accumulated losses
Total equity attributable to the owners of Dubber Corporation Limited
Non-controlling interests
TOTAL EQUITY
Note
2015
$
2014
$
4
5
6
7
9
10
11
12
13
14
26
1,697,415
373,418
-
1,119,997
104,489
554,191
2,070,833
1,778,677
16,876
9,018,934
9,035,810
61,683
-
61,683
11,106,643
1,840,360
933,705
93,303
1,027,008
107,806
-
107,806
1,027,008
107,806
10,079,635
1,732,554
17,637,006
5,252,839
(12,810,210)
10,155,008
993,326
(9,291,859)
10,079,635
-
1,856,475
(123,921)
10,079,635
1,732,554
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
Annual Report - 30 June 2015
Page 29
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
CONSOLIDATED STATEMENT OF CHANGES
IN EQUITY AS AT 30 JUNE 2015
Consolidated Statement of Changes in Equity
Issued
Capital
$
Accumulated
Losses
$
Reserves
$
Non-
controlling
Interests
$
Total
$
2015
Balance at 1 July 2014
10,155,008
(9,291,859)
993,326
(123,921)
1,732,554
Loss after income tax expense for the year
Other comprehensive income for the year,
net of tax
Total comprehensive loss for the year
Transactions with owners in their capacity
as owners:
Non-controlling interests in disposed
subsidiaries
Securities issued during the year
Capital raising costs
Cost of share based payments
-
-
-
(3,518,351)
-
(17,270)
(3,535,621)
-
(3,518,351)
21,967
21,967
-
(17,270)
21,967
(3,513,654)
-
7,896,831
(414,833)
-
-
-
-
-
-
(819,401)
-
5,056,947
141,191
-
-
-
141,191
7,077,430
(414,833)
5,056,947
Balance at 30 June 2015
17,637,006
(12,810,210)
5,252,839
-
10,079,635
2014
Balance at 1 July 2013
8,639,816
(8,370,416)
899,873
(94,365)
1,074,908
Loss after income tax expense for the year
Other comprehensive income for the year,
net of tax
Total comprehensive loss for the year
-
-
-
(921,443)
-
(29,556)
(950,999)
-
(921,443)
2,103
2,103
-
(29,556)
2,103
(948,896)
Transactions with owners in their capacity
as owners:
Securities issued during the year
Capital raising costs
Cost of share based payments
1,598,232
(83,040)
-
-
-
-
-
-
91,350
-
-
-
1,598,232
(83,040)
91,350
Balance at 30 June 2014
10,155,008
(9,291,859)
993,326
(123,921)
1,732,554
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes
Annual Report - 30 June 2015
Page 30
For personal use only
DUBBER CORPORATION
ABN 64 089 145 424
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 UNE 2015
Consolidated Statement of Cash Flows
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Interest and other finance costs paid
Note
2015
$
2014
$
31,478
(2,259,358)
7,416
(118,896)
-
(568,376)
12,733
-
Net cash outflows used in operating activities
23
(2,339,360)
(555,643)
Cash flows from investing activities
Purchase of plant and equipment
Payment of security bond
Loans to other entities
Loans repaid by other entities
Cash acquired on acquisition of subsidiary
Exploration and evaluating expenditure
(8,848)
-
(1,321,366)
150,000
1,884
(92,430)
(814)
(20,000)
(525,000)
-
-
(287,038)
17
Net cash outflows used in investing activities
(1,270,760)
(832,852)
Cash flows from financing activities
Proceeds from issue of shares
Payment of share issue costs
Proceeds from borrowings
Repayment of borrowings
Net cash provided by financing activities
Net increase in cash held
Cash and cash equivalents at the beginning of the year
Effect of exchange rate changes on cash
4,676,620
(367,577)
440,000
(560,687)
1,598,232
(60,096)
-
-
4,188,356
1,538,136
578,236
1,119,997
(818)
149,641
971,800
(1,444)
Cash and cash equivalents at the end of the year
1,697,415
1,119,997
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes
Annual Report - 30 June 2015
Page 31
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Notes to the Consolidated Financial Statements
1.
Summary of Significant Accounting Policies
(a)
Basis of Preparation
Dubber Corporation Limited (“Company” or “Parent Entity”) is a company limited by shares, incorporated and
domiciled in Australia. These consolidated financial statements and notes represent those of Dubber
Corporation Limited and controlled entities (“Group” or “Consolidated Entity”). The nature of the operations
and principal activities of the Group are described in the Directors’ Report.
The financial report is a general purpose financial report that has been prepared in accordance with Australian
Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the
Australian Accounting Standards Board and the Corporations Act 2001. Dubber Corporation Limited is a for-
profit entity for the purpose of preparing the financial statements.
Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a
financial report containing relevant and reliable information about transactions, events and conditions. The
financial statements and notes also comply with International Financial Reporting Standards. Material
accounting policies adopted in the preparation of this financial report are presented below and have been
consistently applied unless otherwise stated.
The financial reports have been prepared on an accruals basis and are based on historical costs, modified,
where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial
liabilities.
The separate financial statements of the parent entity, Dubber Corporation Limited, have not been presented
within this financial report as permitted by the Corporations Act 2001.
These financial statements are presented in Australian dollars, rounded to the nearest dollar.
(b)
Going concern basis
The financial report has been prepared on a going concern basis which contemplates the continuity of normal
business activity and the realisation of assets and the settlement of liabilities in the normal course of business.
For the year ended 30 June 2015 the Group incurred a net loss after tax of $3,535,621 (2014: $950,999), net
cash outflow from operating activities of $2,339,360 (2014: $555,643) and net cash outflow from investing
activities of $1,270,760 (2014: $832,852).
The ability of the Group to continue as a going concern is dependent on the Company being able to raise
additional funds as required to meet ongoing business operating costs and for working capital. The Directors
believe that they will be able to raise additional capital as required and are in the process of evaluating the
Group’s cash requirements. The Directors believe that the Group will continue as a going concern. As a result,
the financial report has been prepared on a going concern basis. However, should the Group be unsuccessful in
undertaking additional raisings, there is a material uncertainty that may cast significant doubt on the Group’s
ability to continue as a going concern and therefore whether it will be able to pay its debts as and when they
fall due. No adjustments have been made relating to the recoverability and classification of liabilities that might
be necessary should the Group not continue as a going concern.
Annual Report - 30 June 2015
Page 32
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(c)
Revenue recognition
Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets,
is the rate inherent in the instrument.
Service income is recognised at the time the service is accessed by the customer. All revenue is stated net of the
amount of goods and services tax (GST).
(d)
Basis of consolidation
Subsidiaries
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Dubber
Corporation Limited (“Company” or “parent entity”) as at 30 June 2015 and the results of all subsidiaries for the
year then ended. Dubber Corporation Limited and its subsidiaries together are referred to in these financial
statements as the Group or the consolidated entity.
Subsidiaries are all entities (including special purpose entities) over which the Group has control. The Group has
control over an entity when the Group is exposed to, or has rights to, variable returns from its involvement with
the entity, and has the ability to use its power to affect those returns.
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-
consolidated from the date that control ceases.
The acquisition method of accounting is used to account for business combinations by the Group.
Intercompany transactions, balances and unrealised gains on transactions between Group companies are
eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of
the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. Refer to the
'business combinations' accounting policy for further details. A change in ownership interest, without the loss of
control, is accounted for as an equity transaction, where the difference between the consideration transferred
and the book value of the share of the non-controlling interest acquired is recognised directly in equity
attributable to the parent.
Non-controlling interest in the results and equity of subsidiaries are shown separately in the statement of profit
or loss and other comprehensive income, statement of financial position and statement of changes in equity of
the consolidated entity. Losses incurred by the consolidated entity are attributed to the non-controlling interest
in full, even if that results in a deficit balance.
Where the consolidated entity loses control over a subsidiary, it derecognises the assets including goodwill,
liabilities and non-controlling interest in the subsidiary together with any cumulative translation differences
recognised in equity. The consolidated entity recognises the fair value of the consideration received and the fair
value of any investment retained together with any gain or loss in profit or loss.
(e)
Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decision maker. The chief operating decision maker, who is responsible for allocating resources and
assessing performance of the operating segments, has been identified as the full Board of Directors.
Annual Report - 30 June 2015
Page 33
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(f)
Foreign currency translation
Functional and presentation currency
(i)
The consolidated financial statements are presented in Australian dollars, which is the functional and
presentation currency of Dubber Corporation Limited.
Transactions and balances
(ii)
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at
the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year end exchange rates of monetary assets and liabilities,
denominated in foreign currencies, are recognised in profit or loss.
Foreign operations
(iii)
The assets and liabilities of foreign operations are translated to the functional currency as exchange rates at the
reporting date. The income and expenses of foreign operations are translated to Australian dollars at exchange
rates at the dates of the transactions.
Foreign currency difference are recognised in other comprehensive income, and presented in the foreign
currency translation reserve in equity.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities are
recognised in other comprehensive income. When the settlement of a monetary item receivable from or
payable to a foreign operation is neither planned nor likely in the foreseeable future, foreign exchange gains
and losses arising from such a monetary item are considered to form part of a net investment in a foreign
operation and are recognised in other comprehensive income, and are presented in the translation reserve in
equity. When a foreign operation is sold or any borrowings forming part of the net investment are repaid, the
associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale.
(g)
Finance income
Finance income comprises interest income earned on funds invested in bank accounts and call deposits.
Interest is recognised on an accruals basis in the consolidated statement of profit or loss and other
comprehensive income, using the effective interest method.
(h)
Income tax
The income tax expense (revenue) for the year comprises current income tax expense (income) and deferred
tax expense (income).
Current income tax expense charged to the profit or loss is the tax payable on taxable income calculated using
applicable income tax rates enacted, or substantially enacted, as at the end of the reporting period. Current tax
liabilities (assets) are therefore measured at the amounts expected to be paid to (recovered from) the relevant
taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during
the year as well as unused tax losses.
Current and deferred tax expense (income) is charged or credited directly to equity instead of the profit or loss
when the tax relates to items that are credited or charged directly to equity.
Deferred tax assets and liabilities are ascertained based on temporary differences arising between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets also result
where amounts have been fully expensed but future tax deductions are available. No deferred income tax will
be recognised from the initial recognition of an asset or liability, excluding a business combination, where there
is no effect on accounting or taxable profit or loss.
Annual Report - 30 June 2015
Page 34
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(h)
Income tax (continued)
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when
the asset is realised or the liability is settled, based on tax rates enacted or substantively enacted at the end of
the reporting period. Their measurement also reflects the manner in which management expects to recover or
settle the carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent
that it is probable that future taxable profit will be available against which the benefits of the deferred tax asset
can be utilised.
Where temporary differences exist in relation to investments in subsidiaries, branches, associates, and joint
ventures, deferred tax assets and liabilities are not recognised where the timing of the reversal of the
temporary difference can be controlled and it is not probable that the reversal will occur in the foreseeable
future.
Current assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that
net settlement or simultaneous realisation and settlement of the respective asset and liability will occur.
Deferred tax assets and liabilities are offset where a legally enforceable right of set-off exists, the deferred tax
assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable
entity or different taxable entities where it is intended that net settlement or simultaneous realisation and
settlement of the respective asset and liability will occur in future periods in which significant amounts of
deferred tax assets or liabilities are expected to be recovered or settled.
(i)
Provisions
Provisions are recognised when a Group company has a legal or constructive obligation, as a result of past
events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably
measured.
(j)
Business combinations
The acquisition method of accounting is used to account for all business combinations, regardless of whether
equity instruments or other assets are acquired. The consideration transferred for the acquisition of a
subsidiary comprises the fair values of the assets transferred, the liabilities incurred and the equity interests
issued by the group. The consideration transferred also includes the fair value of any asset or liability resulting
from a contingent consideration arrangement and the fair value of any pre-existing equity interest in the
subsidiary. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and
contingent liabilities assumed in a business combination are, with limited exceptions, measured initially at their
fair values at the acquisition date. On an acquisition-by-acquisition basis, the group recognises any non-
controlling interest in the acquired asset either at fair value or at the non-controlling interest’s proportionate
share of the acquiree’s net identifiable assets. The excess of the consideration transferred and the amount of
any non-controlling interest in the acquire over the fair value of the net identifiable assets acquired is recorded
as goodwill, If those amounts are less than the fair value of the net identifiable assets of the subsidiary acquired
and the measurement of all amounts has been reviewed, the difference is recognised directly in profit or loss as
a bargain purchase. Where settlement of any part of cash consideration is deferred, the amounts payable in the
future are discounted to their present value as at the date of exchange.
The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar borrowing
could be obtained from an independent financier under comparable terms and conditions. Contingent
consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are
subsequently remeasured to fair value with changes in fair value recognised in profit or loss.
Annual Report - 30 June 2015
Page 35
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(k)
Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown
within short-term borrowings in current liabilities in the statement of financial position.
(l)
Trade receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the
effective interest method, less provision for impairment. Trade receivables are generally due for settlement
within 30 days. They are presented as current assets unless collection is not expected for more than 12 months
after the reporting date.
Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectable
are written off by reducing the carrying amount directly. An allowance account (provision for impairment of
trade receivables) is used when there is objective evidence that the group will not be able to collect all amounts
due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability
that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more
than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the
impairment allowance is the difference between the asset’s carrying amount and the present value of
estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term
receivables are not discounted if the effect of the discounting is immaterial.
The amount of the impairment losses is recognised in profit or loss within other expenses. When a trade
receivable for which an impairment allowance has been recognised becomes uncollectable in a subsequent
period, it is written off against the allowance account. Subsequent recoveries of amounts previously written off
are credited against other expenses in profit or loss.
(m)
Financial instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual
provisions to the instrument. For financial assets, this is the equivalent to the date that the company commits
itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted). Financial instruments
are initially measured at fair value plus transactions costs, except where the instrument is classified 'at fair value
through profit or loss', in which case transaction costs are expensed to profit or loss immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at either of fair value, amortised cost using the effective
interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a
liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are
used to determine fair value. In other circumstances, valuation techniques are adopted. Amortised cost is
calculated as:
(a)
(b)
(c)
the amount at which the financial asset or financial liability is measured at initial recognition;
less principal repayments;
plus or minus the cumulative amortisation of the difference, if any, between the amount initially
recognised and the maturity amount calculated using the effective interest method; and
less any reduction for impairment.
(d)
Annual Report - 30 June 2015
Page 36
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(m)
Financial instruments (continued)
The effective interest method is used to allocate interest income or interest expense over the relevant period
and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees,
transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably
predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or
financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying
value with a consequential recognition of an income or expense in profit or loss.
The Group does not designate any interest as being subject to the requirements of accounting standards
specifically applicable to financial instruments.
Financial assets at fair value through profit or loss
(i)
Financial assets are classified at ‘fair value through profit or loss’ when they are either held for trading for the
purpose of short-term profit taking, derivatives not held for hedging purposes, or when they are designated as
such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is
managed by key management personnel on a fair value basis in accordance with a documented risk
management or investment strategy. Such assets are subsequently measured at fair value with changes in
carrying value being included in profit or loss.
Loans and receivables
(ii)
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are subsequently measured at amortised cost.
Loans and receivables are included in current assets, except for those which are not expected to mature within
12 months after the end of the reporting period. All other loans and receivables are classified as non-current
assets.
Financial liabilities
(iii)
Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised
cost.
Convertible notes are issued from the Company and are convertible at the option of the holder, and the
number of shares to be issued does not vary with changes in their fair value.
The liability component of a convertible note is recognised at the fair value of a similar liability that does not
have an equity conversion option. The equity component is recognised initially at the difference between the
fair value of the convertible note as a whole and the fair value of the liability component.
Any directly attributable transaction costs are allocated to the liability and equity components in proportion to
their initial carrying amounts.
Financial assets are derecognised where the contractual rights to receipt of cash flows expires or the asset is
transferred to another party whereby the entity no longer has any significant continuing involvement in the
risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations
are either discharged, cancelled or expired. The difference between the carrying value of the financial liability
extinguished or transferred to another party and the fair value of consideration paid, including the transfer of
non-cash assets or liabilities assumed is recognised in profit or loss.
Annual Report - 30 June 2015
Page 37
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(n)
Property, plant and equipment
Each class of property, plant and equipment is carried at cost or fair value as indicated, less, where applicable,
any accumulated depreciation and impairment losses.
Plant and equipment
Plant and equipment are measured on the cost basis.
Depreciation
The depreciable amount of all fixed assets including buildings and capitalised leased assets, but excluding
freehold land, is depreciated on a straight-line basis over the asset's useful life to the company commencing
from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of
either the unexpired period of the lease or the estimated useful lives of the improvements.
The estimated useful lives used for each class of depreciable assets are:
Class of Fixed Asset
Furniture, Fixtures and Fittings
Computer Equipment
Computer Software
Useful Life
4 years
3 years
3 years
The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each
reporting period. An asset's carrying amount is written down immediately to its recoverable amount if the
asset's carrying amount is greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains
and losses are included in the statement of profit or loss and other comprehensive income. When revalued
assets are sold, amounts included in the revaluation surplus relating to that asset are transferred to retained
earnings.
Property, plant and equipment is derecognised and removed from the statement of financial position on
disposal or when no future economic benefits are expected. Gains and losses from derecognition are measured
as the difference between the net disposal proceeds, if any, and the carrying amount and are recognised in the
statement of profit or loss and other comprehensive income.
Subsequent costs are included in the property, plant and equipment's carrying value or recognised as a
separate asset when it is probable that future economic benefits associated with the item will be realised and
the cost of the item can be measured reliably. All other repairs and maintenance are recognised in the
statement of profit or loss and other comprehensive income.
Annual Report - 30 June 2015
Page 38
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(o)
Exploration and development expenditure
Exploration and evaluation expenditures in relation to each separate area of interest are recognised as an
exploration and evaluation asset in the year in which they are incurred where the following conditions are
satisfied:
i)
ii)
the rights to tenure of the area of interest are current; and
at least one of the following conditions is also met:
a.
the exploration and evaluation expenditures are expected to be recouped through successful
development and exploration of the area of interest, or alternatively, by its sale; or
exploration and evaluation activities in the area of interest have not, at the reporting date,
reached a stage which permits a reasonable assessment of the existence or otherwise of
economically recoverable reserves, and active and significant operations in, or in relation to, the
area of interest are occurring.
b.
Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore,
studies, exploratory drilling, trenching and sampling and associated activities and an allocation of depreciation
and amortisation of assets used in exploration and evaluation activities. General and administrative costs are
only included in the measurement of exploration and evaluation costs where they are related directly to
operational activities in a particular area of interest.
Exploration and evaluation assets are assessed for impairment when facts and circumstances suggest that the
carrying amount of an exploration and evaluation asset may exceed its recoverable amount. The recoverable
amount of the exploration and evaluation asset is estimated to determine the extent of the impairment loss (if
any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not
exceed the carrying amount that would have been determined had no impairment loss been recognised for the
asset in previous years.
(p)
Impairment of assets
At each reporting date, the Group assesses whether there is any indication that an asset may be impaired. The
assessment will include the consideration of external and internal sources of information including, dividends
received from subsidiaries, associates or jointly controlled entities deemed to be out of pre-acquisition profits.
If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount
of the asset, being the higher of the asset's fair value less costs to sell and value in use, to the asset's carrying
value. Any excess of the asset's carrying value over its recoverable amount is expensed to the statement of
profit or loss and other comprehensive income.
Where an impairment loss on a revalued asset is identified, this is debited against the revaluation surplus in
respect of the same class of asset to the extent that the impairment loss does not exceed the amount in the
revaluation surplus for that same class of asset.
Non-financial assets, other than inventories, deferred tax assets, assets from employee benefits, investment
properties, biological assets, and deferred acquisition costs, are assessed for any indication of impairment at
the end of each reporting period. Any indication of impairment requires formal testing of impairment by
comparing the carrying amount of the asset to an estimate of the recoverable amount of the asset. An
impairment loss is calculated as the amount by which the carrying amount of the asset exceeds the recoverable
amount of the asset.
Intangible assets with an indefinite useful life and intangible assets not yet available for use are tested for
impairment annually regardless of whether there is any indication of impairment.
Annual Report - 30 June 2015
Page 39
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(p)
Impairment of assets (continued)
The recoverable amount is the greater of the asset's fair value less costs to sell and its value in use. The asset's
value in use is calculated as the estimated future cash flows discounted to their present value using a pre-tax
rate that reflects current market assessments of the time value of money and the risks associated with the
asset. Assets that cannot be tested individually for impairment, are grouped together into the smallest group of
assets that generates cash inflows (the asset's cash-generating unit).
Impairment losses are recognised in the statement of profit or loss and other comprehensive income.
Impairment
losses are allocated first, to reduce the carrying amount of any goodwill allocated to
cash-generating units, and then to other assets of the group on a pro-rata basis.
Assets other than goodwill are assessed at the end of each reporting period to determine whether previously
recognised impairment losses may no longer exist or may have decreased. Impairment losses recognised in
prior periods for assets other than goodwill are reversed up to the carrying amounts that would have been
determined had no impairment loss been recognised in prior periods.
(q)
Trade and other payables
Trade and other payables represent the liability outstanding at the end of the reporting period for goods and
services received by the company during the reporting period which remain unpaid. The balance is recognised
as a current liability with the amounts normally paid within 30 days of recognition of the liability.
(r)
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.
(s)
Contributed equity
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for
the acquisition of a business are not included in the cost of the acquisition as part of the purchase
consideration.
(t)
Earnings per share
Basic earnings per share
(i)
Basic earnings per share is calculated by dividing the profit attributable to ordinary shareholders of the
company by the weighted average number of ordinary shares outstanding during the financial year.
Diluted earnings per share
(ii)
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into
account the after income tax effect of interest and other financing costs associated with dilutive potential
ordinary shares and the weighted average number of shares assumed to have been issued for no consideration
in relation to dilutive potential ordinary shares.
Annual Report - 30 June 2015
Page 40
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(u)
Share-based payment transactions
Employees of the Company receive remuneration in the form of share-based payment transactions, whereby
employees render services in exchange for equity instruments ("equity-settled transactions").
When the goods or services acquired in a share-based payment transaction do not qualify for recognition as
assets, they are recognised as expenses.
The cost of equity-settled transactions and the corresponding increase in equity is measured at the fair value of
the goods or services acquired. Where the fair value of the goods or services received cannot be reliably
estimated, the fair value is determined indirectly by the fair value of the equity instruments using the Black
Scholes option valuation technique.
Equity-settled transactions that vest after employees complete a specified period of service are recognised as
services received during the vesting period with a corresponding increase in equity.
(v)
Intangible assets
Other intangible assets that are acquired by the Group and have finite useful lives are measured at costs less
accumulated amortisation and accumulated impairment losses. Other intangible assets are amortised on a
straight line basis in the profit and loss over their estimated useful lives, from the date that they are available
for use. The estimated useful life of the intangible asset is 10 years.
(w)
Employee Provisions
Short-term employee benefit obligations
(i)
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave
expected to be settled wholly within 12 months after the end of the reporting period are recognised in other
liabilities in respect of employees' services rendered up to the end of the reporting period and are measured at
amounts expected to be paid when the liabilities are settled. Liabilities for non-accumulating sick leave are
recognised when leave is taken and measured at the actual rates paid or payable.
Other long-term employee benefit obligations
(ii)
Liabilities for long service leave and annual leave are not expected to be settled wholly within 12 months after
the end of the reporting period. They are recognised as part of the provision for employee benefits and
measured as the present value of expected future payments to be made in respect of services provided by
employees to the end of the reporting period using the projected unit credit method. Consideration is given to
expected future salaries and wages levels, experience of employee departures and periods of service. Expected
future payments are discounted using national government corporate bond rates at the end of the reporting
period with terms to maturity and currency that match, as closely as possible, the estimated future cash
outflows.
Regardless of when settlement is expected to occur, liabilities for long service leave and annual leave are
presented as current liabilities in the statement of financial position if the entity does not have an unconditional
right to defer settlement for at least 12 months after the end of the reporting period.
(x)
Critical accounting estimates and judgements
The directors evaluate estimates and judgments incorporated into the financial statements based on historical
knowledge and best available current information. Estimates assume a reasonable expectation of future events
and are based on current trends and economic data, obtained both externally and within the company.
Key estimates - Impairment
The Group assesses impairment at the end of the reporting period by evaluating conditions specific to the
Annual Report - 30 June 2015
Page 41
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
company that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed
using value-in-use calculations which incorporate various key assumptions.
Key judgements – Exploration and evaluation expenditure
The Group capitalises expenditure relating to exploration and evaluation where it is considered likely to be
recoverable or where the activities have not reached a stage which permits a reasonable assessment of the
existence of reserves. While there are certain areas of interest from which no reserves have been extracted, the
directors are of the continued belief that such expenditure should not be written off since feasibility studies in
such areas have not yet concluded.
Key judgements – Share-based payment transactions
The Company measures the cost of equity-settled transactions with employees by reference to the fair value of
the equity instruments at the date at which they are granted. The fair value is determined using the
Black-Scholes method. The related assumptions are detailed in note 24. The accounting estimates and
assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts of
assets and liabilities within the next annual reporting period but may impact expenses and equity.
Key Estimates-Impairment of Intangibles
The group tests whether intangibles have suffered any impairment, in accordance with the accounting policy in
note 1. The recoverable amount of the intangible is based on a number of assumptions. No impairment has
been recognised in respect to of the intangible at the reporting period.
Annual Report - 30 June 2015
Page 42
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1.
Summary of Significant Accounting Policies (Continued)
(y)
New accounting standards for application in future period & current periods
In the year ended 30 June 2015, the Company has reviewed all of the new and revised Standards and
Interpretations issued by the AASB that are relevant to its operations and effective for the current annual
reporting period.
It has been determined by the Company that there is no impact, material or otherwise, of the new and revised
Standards and Interpretations on its business and, therefore, no change is necessary to the Group accounting
policies.
The Company has also reviewed all new Standards and Interpretations that have been issued but are not yet
effective for the year ended 30 June 2015.
Reference
Title
Summary
AASB 9
Financial
Instruments
AASB 9 AAB 9 addresses the
classification, measurement and
derecognition of financial assets
and financial liabilities. Since
December 2013, it also sets out
new rules for hedge accounting.
AASB 15
(issued
June 2014)
Revenue
from
contracts
with
customers
Annual Report - 30 June 2015
An entity will recognise revenue to
depict the transfer of promised
goods or services to customers in
an amount that reflects the
consideration to which the entity
expects to be entitled in exchange
for those goods or services. This
means that revenue will be
recognised when control of goods
or services is transferred, rather
than on transfer of risks and
rewards as is currently the case
Impact on Group’s financial
report
There will be no impact on the
company’s accounting for
financial assets and financial
liabilities as the new
requirements only affect the
accounting for available-for-sale
financial assets and the
accounting for financial liabilities
that are designated at fair value
through profit or loss and the
company does not have any such
financial assets or financial
liabilities.
The new hedging rules align
hedge accounting more closely
with the company’s risk
management practices. As a
general rule it will be easier to
apply hedge accounting going
forward. The new standard also
introduces expanded disclosure
requirements and changes in
presentation.
The company has not yet made
an assessment of the impact of
this standard.
Application
date for
Group
Must be
applied for
financial years
commencing
on or after 1
January 2018.
Application
date for the
company will
be 30 June
2019.
The company
does not
currently have
any hedging
arrangements
in place.
Must be
applied for
annual
reporting
periods
beginning on
or after 1
January 2018.
Application
date for the
company will
Page 43
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Reference
Title
Summary
under IAS 18 Revenue.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Impact on Group’s financial
report
Application
date for
Group
be 30 June
2019.
The Group has not elected to early adopt any new Standards or Interpretations.
(z)
Parent entity financial information
The financial information for the parent entity, Dubber Corporation Limited, disclosed in note 25 has been
prepared on the same basis as the consolidated financial statements.
Annual Report - 30 June 2015
Page 44
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
2.
Revenue and Expenses from Continuing Operations
(a) Other revenue
Interest
(b) Other expenses
Audit fees
Accounting and tax advice fees
Exploration impaired
Legal fees
Marketing
Securities exchange and registry fees
Travel costs
Other administration
3.
Income Tax
(a) Income Tax Expense
Loss before income tax expense
Tax at the Australian tax rate of 30%
Tax effect of amounts not deductible (taxable) in calculating taxable
income
Deferred tax asset not brought to account on temporary differences &
tax losses
Income tax expense
(b) Unrecognised Deferred Tax Assets
Timing differences
Tax losses – revenue
Tax losses - capital
Offset against deferred tax liabilities recognised
Deferred tax assets not brought to account
There are no franking credits available to the Group.
Consolidated
2015
$
2014
$
7,416
12,733
33,558
115,973
7,500
116,129
116,400
92,580
119,834
281,655
883,629
26,409
43,590
46,498
55,976
-
34,065
23,454
99,107
329,099
(3,535,621)
(921,443)
(1,060,686)
(276,433)
(183,144)
132,852
1,243,830
143,581
-
-
95,354
2,542,999
323,367
2,961,720
-
2,961,720
9,789
1,677,000
323,367
2,010,156
-
2,010,156
Annual Report - 30 June 2015
Page 45
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
4.
Cash and Cash Equivalents
Cash at bank
The company’s exposure to interest rate risk is outlined in note 16.
5.
Trade and Other Receivables
Current
Trade receivables
GST recoverable
Receivable from Medulla Group Pty Ltd vendors
Prepayments
Other receivables
Consolidated
2015
$
2014
$
1,697,415
1,697,415
1,119,997
1,119,997
82,870
119,086
106,366
6,596
58,500
373,418
-
27,298
-
57,191
20,000
104,489
The acquisition of Medulla Group Pty Ltd (“Medulla”) was on a no liability basis. It was determined on reconciling the
acquisition and liabilities paid of Medulla that the vendors of Medulla Group Pty Ltd owed Dubber Corporation Limited
$106,366. Receipt of this amount is expected within 6 months of 30 June 2015.
Trade and other receivables are all due within three months of this report and no impairment provision has been
made.
Information about credit and liquidity risk is outlined in note 16. Prepayments consist of prepaid insurance and
consulting fees.
6.
Other Assets
Current
Loan – Abidjan office
Guarantees – Abidjan office
Convertible note advances
Funding to Dubber Pty Ltd
-
-
-
-
-
18,724
10,467
500,000
25,000
554,191
The loan and guarantees represented expenditure incurred on the Group’s office in Abidjan, Côte d’Ivoire on behalf of
the landlord. Rent on the premises was offset against the loan, and interest charged on the outstanding balance. This
arrangement completed with the closure of the Abidjan office in December 2014.
The convertible note advances were interest free unsecured funding to Dubber Pty Ltd (“Dubber”), in accordance with
the binding term sheet with Dubber, Medulla Group Pty Ltd (“Medulla”) and Medulla’s shareholders, with the funds
used for the commercialisation of Dubber’s voice recording software. The Company agreed to provide additional
interest free unsecured funding to Dubber for the marketing, sales and distribution of its software on an as needs basis
until completion of the acquisition of Medulla. The total loans to Dubber were eliminated within the Group, upon the
completion of the acquisition of Medulla on 27 February 2015.
Risk management policies in regard to credit and currency risk are outlined in note 16.
Annual Report - 30 June 2015
Page 46
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
7.
Property, Plant and Equipment
Plant and equipment – at cost
Less: Accumulated depreciation
Net carrying amount
Consolidated
2015
$
2014
$
30,516
(13,640)
16,876
142,115
(80,432)
61,683
Reconciliation
Reconciliation of the carrying amount for each class of property, plant and equipment between the beginning and the
end of the current and previous financial year are set out below:
2015
Balance at the beginning of the year
Additions
Acquisition of subsidiary (note 17)
Foreign exchange movement
Depreciation expense
Impairment (i)
Carrying amount at the end of the year
2014
Balance at the beginning of the year
Additions
Foreign exchange movement
Depreciation expense
Carrying amount at the end of the year
Computer
Equipment
$
Office
Renovations
$
Furniture
$
Plant &
Equipment
$
Total
$
2,442
4,316
5,940
-
(2,787)
(1,048)
8,863
4,726
814
111
(3,209)
2,442
14,516
-
-
(2)
(3,072)
(11,442)
-
19,742
-
431
(5,657)
14,516
15,851
4,532
4,173
(3)
(5,482)
(11,278)
7,793
24,587
-
584
(9,320)
15,851
28,874
-
-
(5)
(8,686)
(19,963)
220
45,025
-
1,051
(17,202)
28,874
61,683
8,848
10,113
(10)
(20,027)
(43,731)
16,876
94,080
814
2,177
(35,388)
61,683
(i)
The property, plant and equipment held at the Group’s office in Abidjan, Côte d’Ivoire with a carrying value of
$43,731 at 31 December 2014 (30 June 2014: $60,801) were impaired to their recoverable value of nil with the
closure of the Abidjan office on that date.
8.
Exploration Expenditure
Balance at the beginning of the year
Expenditure incurred during the year
Expenditure incurred during the year expensed
Exploration expenditure at cost
Consolidated
2015
$
2014
$
-
119,414
(119,414)
-
-
310,087
(310,087)
-
The recoverability of the carrying amount of the transaction and evaluation assets is dependent upon the successful
development and commercial exploitation, or alternatively, sale of the respective areas of interest. The exploration
expenditure has been written-off in 2015 as the recoverability criteria by further exploration or sale is not considered
capable of satisfaction.
Annual Report - 30 June 2015
Page 47
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
9.
Intangible Assets
Dubber intellectual property – at cost
Less: Accumulated amortisation
Net carrying amount
Reconciliation
Balance at the beginning of the year
Acquisition of subsidiary (note 17)
Amortisation expense
Net carrying amount at the end of the year
10.
Trade and Other Payables
Current
Trade payables
Payroll tax and other statutory liabilities
Other payables
Consolidated
2015
$
2014
$
9,329,932
(310,998)
9,018,934
-
9,329,932
(310,998)
9,018,934
-
-
-
-
-
-
-
408,910
488,295
36,500
933,705
69,773
-
38,033
107,806
All payables are expected to be settled within 6 months. Risk management policies in regard to liquidity and currency
risk are outlined in note 16.
11.
Provisions
Current
Employee benefits
93,303
93,303
-
-
Employee benefits represent annual leave entitlements of employees within the Group and is non-interest bearing.
The entire obligation is presented as current, since the Group does not have a right to defer settlement.
Annual Report - 30 June 2015
Page 48
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
12.
Issued Capital
Issued and paid up capital
57,492,814 (2014: 90,043,920) Ordinary shares – fully paid
Share issue costs written off against share capital
Consolidated
2015
$
2014
$
18,525,025
(888,019)
17,637,006
10,628,194
(473,186)
10,155,008
Movement in ordinary shares on issue
2015
Balance at the beginning of the year
Consolidation of shares at 1:5 – 15 December 2014
Issued for cash pursuant to prospectus – 27 February 2015
Issued as part consideration for acquisition of subsidiary (note 17)
– 27 February 2015
Issued as consideration for acquisition advisor fees – 27 February
2015
Conversion of performance shares on achieving milestone – 27
February 2015
Issued upon conversion of acquired subsidiary’s convertible notes
– 27 February 2015
Share issue costs
Balance at the end of the year
2014
Balance at the beginning of the year
Issued for cash pursuant to placement – 6 May 2014
Issued for cash pursuant to renounceable rights issue – 5 June
Issue Price
No. of Shares
$
$0.20
$0.20
$0.20
$0.20
$0.20
90,043,920
(72,035,260)
23,383,100
10,155,008
-
4,676,620
5,248,088
1,049,618
755,961
151,192
4,097,005
819,401
6,000,000
57,492,814
1,200,000
(414,833)
17,637,006
$0.025
26,114,640
3,900,000
8,639,816
97,500
2014
$0.025
15,201,127
380,028
Issued for cash pursuant to renounceable rights issue – 27 June
2014
Share issue costs
Balance at the end of the year
Options
$0.025
44,828,153
90,043,920
1,120,704
(83,040)
10,155,008
At the end of the year, the following options over unissued ordinary shares were outstanding:
Exercise Price Number under
Grant Date
25 November 2014
15 December 2014
27 February 2015
9 June 2015
30 June 2015
Expiry Date
25 November 2016
31 January 2018
27 February 2018
30 June 2018
31 March 2019
$0.25
$0.25
$0.25
$0.40
$0.25
Option
1,000,000
3,000,000
600,000
2,700,000
2,250,000
9,550,000
Annual Report - 30 June 2015
Page 49
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
12.
Issued Capital (continued)
Performance shares
Each performance share converts into one fully paid ordinary share for nil cash consideration, upon the achievement
of performance based milestones. At the end of the year, the following performance shares yet to be converted into
ordinary shares were outstanding:
Grant Date
28 November 2014
27 February 2015
27 February 2015
9 June 2015
Expiry Date
27 May 2017
27 August 2015
27 May 2017
30 June 2018
Capital risk management
Number of
Performance
Shares
4,000,000
4,096,975
13,315,173
1,800,000
23,212,148
The group’s objectives when managing capital are to safeguard the ability to continue as a going concern, so that
benefits to stakeholders and an optimum capital structure are maintained.
In order to maintain or adjust the capital structure, the company may return capital to shareholders, cancel capital,
issue new shares or options or sell assets.
13.
Reserves
Option reserve
Performance share reserve
Foreign currency reserve
Option reserve
Consolidated
2015
$
2014
$
1,495,943
3,756,896
-
5,252,839
1,015,293
-
(21,967)
993,326
The option reserve is used to accumulate amounts received on the issue of options and records items recognised as
expenses on valuation of incentive based share options.
Movement in option reserve:
Balance at the beginning of the year
Issue of incentive based share options – directors options
Options issued as consideration for capital raising services – broker options
Options issued upon conversion of acquired subsidiary’s convertible notes –
attaching options
Issue of incentive based share options – directors and key management
Balance at the end of the year
1,015,293
-
70,200
402,150
8,300
1,495,943
923,943
91,350
-
-
-
1,015,293
Annual Report - 30 June 2015
Page 50
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Consolidated
2015
$
2014
$
13.
Reserves (continued)
Performance share reserve
The performance share reserve is used to record the value of performance shares issued as share based payments
until the performance shares are converted into fully paid ordinary shares upon achievement of performance based
milestones.
Movement in performance share reserve:
Balance at the beginning of the year
Issued as incentive share based payment – management performance shares
Issued as part consideration for acquisition of subsidiary (note 17)
Issued as consideration for acquisition advisor fees
Issued as incentive share based payment – directors and key management
Converted into ordinary shares upon achievement of performance milestone
Balance at the end of the year
-
263,492
4,219,885
81,939
10,981
(819,401)
3,756,896
-
-
-
-
-
-
-
Foreign currency reserve
The foreign currency reserve is used to record exchange differences arising from the translation of the financial
statements of foreign operations.
Movement in foreign currency reserve:
Balance at the beginning of the year
Currency translation differences
Derecognition on disposal of subsidiary (note 18)
Balance at the end of the year
(21,967)
(826)
22,793
-
(24,070)
2,103
-
(21,967)
14. Accumulated Losses
Balance at the beginning of the year
Total comprehensive loss for the year
Balance at the end of the year
(9,291,859)
(3,518,351)
(12,810,210)
(8,370,416)
(921,443)
(9,291,859)
Annual Report - 30 June 2015
Page 51
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
15.
Earnings per Share (EPS)
The earnings and weighted average number of ordinary shares used in
the calculation of basic earnings per share are as follows:
Earnings attributable to the owners of Dubber Corporation Limited
used to calculate EPS
Loss from continuing operations
Loss from discontinued operations
Loss for the year
Weighted average number of ordinary shares used in the calculation
of EPS
Weighted average number of ordinary shares used as the
denominator in calculating basic EPS
As the Company is in a loss position there is no diluted EPS calculated
16.
Financial Risk Management
Consolidated
2015
$
2014
$
$
(3,198,930)
(319,421)
(3,518,351)
$
(655,446)
(265,997)
(921,443)
No.
No.
31,422,455
28,287,084
Financial instruments consist mainly of deposits with banks and accounts receivable and payable.
The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the
accounting policies to these financial statements, are as follows:
Financial Assets
Cash and cash equivalents
Trade and other receivables
Total Financial Assets
Financial Liabilities
Trade and other payables
Total Financial Instruments
Weighted Average
Interest Rate (%)
Note
2015
$
2014
$
1.9
-
-
4
5, 6
10
1,697,415
366,822
2,064,237
933,705
1,130,532
1,119,997
601,489
1,721,486
107,806
1,613,680
The carrying amounts of these financial instruments approximate their fair values.
Annual Report - 30 June 2015
Page 52
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
16.
Financial Risk Management (continued)
Financial Risk Management Policies
Exposure to key financial risks is managed in accordance with the Group’s risk management policy with the objective
to ensure that the financial risks inherent in mineral exploration activities and new business reviews are identified and
then managed or kept as low as reasonably practicable.
The main financial risks that arise in the normal course of business are market risk (including currency risk and interest
rate risk), credit risk and liquidity risk. Different methods are used to measure and manage these risk exposures.
Liquidity risk is monitored through the ongoing review of available cash and future commitments for exploration
expenditure. Exposure to liquidity risk is limited by anticipating liquidity shortages and ensures capital can be raise in
advance of shortages. Interest rate risk is managed by limiting the amount interest bearing loans entered into by the
company. It is the Board's policy that no speculative trading in financial instruments be undertaken so as to limit
expose to price risk.
Primary responsibility for identification and control of financial risks rests with the Company Secretary, under the
authority of the Board. The Board is apprised of these risks from time to time and agrees any policies that may be
undertaken to manage any of the risks identified.
Details of the significant accounting policies and methods adopted, including criteria for recognition, the basis of
measurement and the basis on which income and expenses are recognised, in respect of each financial instrument are
disclosed in Note 1 to the financial statements. The carrying values less the impairment allowance for receivables and
payables are assumed to approximate fair values due to their short term nature. Cash and cash equivalents are
subject to variable interest rates.
Specific Financial Risk Exposures and Management
(c) Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counter parties
of contract obligations that could lead to a financial loss to the company.
The company trades only with recognised, creditworthy third parties.
The company has no customers and consequently no significant exposure to bad debts or other credit risks.
With respect to credit risk arising from financial assets, which comprise cash and cash equivalents and
receivables, the exposure to credit risk arises from default of the counter party, with a maximum exposure
equal to the carrying amount of these instruments. The majority of cash and deposits is held with ANZ Bank
Ltd, a AA- credit rated bank.
(d) Liquidity risk
Liquidity risk arises from the possibility that the company might encounter difficulty in settling its debts or
otherwise meeting its obligations related to financial liabilities.
Prudent liquidity risk management implies maintaining sufficient cash reserves to meet the ongoing operational
requirements of the business. It is the company’s policy to maintain sufficient funds in cash and cash
equivalents. Furthermore, the company monitors its ongoing research and development cash requirements
and raises equity funding as and when appropriate to meet such planned requirements. The company has no
undrawn financing facilities. Trade and other payables, the only financial liability of the company, are due
within 3 months.
Annual Report - 30 June 2015
Page 53
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
16.
Financial Risk Management (continued)
The tables below reflect an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management's expectation as to the timing of realisation.
Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle
financial liabilities reflects the earliest contractual settlement dates and does not reflect management's
expectations that banking facilities will be rolled forward.
Financial liability and financial asset maturity analysis
Within 1 Year
1 to 5 Years
Total Contractual Cash
Flow
2015
$
2014
$
2015
$
2014
$
2015
$
2014
$
Financial assets – cash flows receivable
Trade and other receivables
Total expected inflows
366,822
366,822
601,489
601,489
Financial liabilities due for payment
realisable
Trade and other payables
Total anticipated outflows
Net (outflow)/inflow on financial
instruments
(b) Market risk
933,705
933,705
107,806
107,806
(566,883)
493,683
-
-
-
-
-
-
-
-
-
-
366,822
366,822
601,489
601,489
933,705
933,705
107,806
107,806
(566,883)
493,683
i. Interest rate risk
The company’s cash-flow interest rate risk primarily arises from cash at bank and deposits subject to market
bank rates. The company does not have any borrowings or enter into hedges. An increase/(decrease) in interest
rates by 1% during the whole of the respective periods would have led to an increase/(decrease) in both equity
and losses of less than $16,975.
ii. Currency risk
The Company previously operated in West Africa and was exposed to foreign exchange risk arising from
currency exposures, primarily with respect to the Central African Franc (XOF).
Foreign exchange risk arises from future commercial transactions and recognised assets and liabilities
denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity
analysis and cash flow forecasting,
Due to the discontinuation of the Company’s foreign operations at this stage, the group does not hedge foreign
exchange exposure.
(c) Fair value
The Group does not have any financial instruments that are subject to recurring fair value measurements. Due
to their short-term nature, the carrying amounts of the current receivables and current trade and other
payables is assumed to approximate their fair value.
Annual Report - 30 June 2015
Page 54
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
17.
Business Combination
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
On 27 February 2015, the Company acquired 100% of the issued shares of Medulla Group Pty Ltd (“Medulla”). Medulla
owns 100% of Dubber Pty Ltd the operating entity of the Dubber technology suite. Medulla is a holding entity with no
material operations.
The total cost of the acquisition was $5,269,503 and comprised an issue of equity instruments. The Company issued
5,248,088 ordinary fully paid shares and 21,099,427 performance shares to the shareholders of Medulla, as
consideration for the acquisition.
The provisionally accounted fair value of the identifiable assets and liabilities of the subsidiary as at the date of
acquisition were:
Cash and cash equivalents
Trade and other receivables
Plant and equipment
Intangible asset – Dubber intellectual property
Trade and other payables
Provisions
Loans and borrowings
Loan payable to Dubber Corporation Limited
Net assets acquired
Cost of the acquisition:
Securities issued, at fair value
Cash paid or payable to the vendor
Payments made in prior periods
Direct costs relating to the acquisition
Total cost of the combination
Net cash flow from the acquisition:
Cash acquired with subsidiary
Cash paid to the vendor
Net cash inflow
Fair Value
$
1,884
133,662
10,113
9,329,932
(811,735)
(81,547)
(120,656)
(3,192,150)
5,269,503
5,269,503
-
-
-
5,269,503
1,884
-
1,884
The acquired subsidiary contributed revenues of $62,203 and loss after tax of $1,813,501 to the Group for the period
from 27 February 2015 to 30 June 2015. If the acquisition had occurred on 1 July 2014, the full year contributions
would have been revenue of $108,013 and loss after tax of $4,947,433. We have applied provisional accounting to this
transaction.
Annual Report - 30 June 2015
Page 55
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
18. Discontinued Operations
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
In December 2014, the Company closed the Group’s office in Abidjan, Côte d’Ivoire. On 31 March 2015, the
consolidated entity sold its 90% interest in Major Star SA, a company registered in Côte d’Ivoire that owned the Bodite
and Aboisso exploration licences in Cote d’Ivoire. Following the insignificant results returned by exploration activities
conducted during the year, the subsidiary was sold for nil consideration and saved the Group the costs associated with
relinquishing the licences and deregistering the subsidiary.
Financial information relating to the discontinued operation for the period to the date of disposal is set out below.
Financial performance and cash flow information
The financial performance and cash flow information presented are for the nine months ended 31 March 2015 and the
year ended 30 June 2014.
Financial performance:
Revenue
Interest
Expenses
Depreciation and amortisation
Exploration expensed
Impairment of property, plant and equipment
Loss before income tax expense
Income tax expense
Loss after income tax
Loss on disposal before income tax
Income tax expense
Loss on disposal after income tax
2015
$
2014
$
-
2,018
(17,059)
(111,914)
(43,731)
(172,704)
-
(33,983)
(263,589)
-
(295,554)
-
(172,704)
(295,554)
(163,987)
-
(163,987)
-
-
-
Loss after income tax expense from discontinued operations
(336,691)
(295,554)
Cash flow:
Net cash used in investing activities
Net cash from financing activities
Effect of exchange rate changes on cash
Net Increase/decrease in cash and cash equivalents from discontinued
operations
(84,929)
135,874
(42,653)
8,292
(241,355)
192,902
(12,619)
(61,072)
Annual Report - 30 June 2015
Page 56
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
18. Discontinued Operations (continued)
Details of the sale of the subsidiary
Carrying amounts of assets and liabilities disposed:
Cash and cash equivalents
Net assets
Details of disposal:
Total sale consideration
Non-controlling interests
Carrying amount of net assets disposed
Derecognition of foreign currency reserve
Disposal costs
Loss on disposal before income tax
Income tax expense
Loss on disposal after income tax
19. Auditors’ Remuneration
Remuneration of the auditor of the company, BDO Audit (WA) Pty Ltd,
for:
Audit services
Taxation advice – BDO Corporate Tax (WA) Pty Ltd
Corporate advice – BDO Corporate Finance (WA) Pty Ltd
Payments to other auditors
Due diligence report – BDO East Coast Partnership
Total remuneration to auditors
$
3
3
-
(141,191)
(3)
(22,793)
-
(163,987)
-
(163,987)
Consolidated
2015
$
2014
$
33,558
17,289
10,850
61,697
12,000
73,697
26,409
16,340
-
42,749
9,000
51,749
20.
Contingent Liabilities
The Consolidated entity has no material contingent liabilities as at reporting date (2014: Nil).
Annual Report - 30 June 2015
Page 57
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
21. Operating Segments
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The Group has identified its operating segments based on the internal reports that are reviewed and used by the
Board of Directors (chief operating decision makers) in assessing performance and determining the allocation of
resources.
The Group is managed primarily on the basis that it has only one main operating segment. Previously, this involved the
exploration of mineral resources in West Africa. With the acquisition of Dubber Pty Ltd on 27 February 2015 and the
disposal of the West African gold projects on 31 March 2015, the Group’s sole continuing operation is the Dubber
technology suite. All the Group’s activities are interrelated, and discrete financial information is reported to the Board
of Directors as a single segment. Accordingly, all significant operating decisions are based upon analysis of the Group
as one segment.
The financial results from this segment are equivalent to the financial statements of the Group as a whole.
The accounting policies applied for internal purposes are consistent with those applied in the preparation of these
financial statements.
Gold West
Africa
(Discontinued)
$
Technology
$
Total
$
Corporate
$
7,416
(1,541,916)
1,635,273
(93,850)
-
(663)
-
-
(180,204)
-
-
-
(17,059)
(119,414)
(43,731)
-
-
12,733
(608,948)
1,758,660
(105,598)
-
(1,405)
-
2,018
(342,051)
81,700
(2,208)
814
(33,983)
(310,087)
62,203
(1,813,501)
9,471,370
(933,158)
69,619
(3,535,621)
11,106,643
(1,027,008)
8,848
(2,305)
-
9,329,932
(310,998)
-
-
-
-
-
-
-
8,848
(20,027)
(119,414)
(43,731)
9,329,932
(310,998)
14,751
(950,999)
1,840,360
(107,806)
814
(35,388)
(310,087)
Year Ended 30 June 2015
Revenue
Result (Loss)
Total assets
Total liabilities
Acquisition of non-current assets
Depreciation of non-current assets
Exploration expensed
Impairment of property, plant and
equipment
Intangible assets
Amortisation
Year Ended 30 June 2014
Revenue
Result (Loss)
Total assets
Total liabilities
Acquisition of non-current assets
Depreciation of non-current assets
Exploration expensed
Annual Report - 30 June 2015
Page 58
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
22.
Related Party Transactions
Subsidiaries
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
The consolidated financial statements include the financial statements of Dubber Corporation Limited ant the
subsidiaries listed in the following table:
Country of Incorporation
Class of Shares
Australia
Australia
Côte d’Ivoire
Ghana
Australia
Australia
Côte d’Ivoire
Côte d’Ivoire
Côte d’Ivoire
Australia
Australia
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Equity Holding
2015
%
2014
%
100
100
-
-
100
100
-
-
-
100
100
100
100
90
90
100
100
100
100
100
-
-
Westaf Pty Ltd
JEM Resources Pty Ltd
Major Star SA
Major Sun Mining Company Ltd
Cote Gold Pty Ltd
Queen Gold Pty Ltd
Cote Gold SA
Queen Gold SA
Westaf SA
Medulla Group Pty Ltd
Dubber Pty Ltd
Parent entity
Dubber Corporation Limited is the ultimate Australian parent entity and ultimate parent of the Group.
Key management personnel
Refer to the Remuneration Report contained in the Directors' Report for details of the remuneration paid or payable to
each member of Dubber Corporation Limited's key management personnel for the year ended 30 June 2015.
The totals of remuneration paid to key management personnel of the company during the year are as follows:
Short-term employee benefits
Post-employment benefits
Share-based payments
Consolidated
2015
$
2014
$
532,665
34,589
282,772
850,026
253,422
8,491
91,350
353,263
Other transactions with key management personnel
Payments totalling nil (2014: $7,500) were paid to Avitus Capital Ltd, a company associated with Mr Pawlowitsch, for
consulting fees (not provided by Mr Pawlowitsch).
Payments totalling $17,482 (2014: $39,275) were paid to Ventnor Resources Ltd (a company associated with Mr
Pawlowitsch) for rent for the Company’s former offices in West Perth and shared expenses.
The Company paid an amount of nil (2014: $3,486) to TD Continental (a company associated with Mr Mian) for field
staff.
Annual Report - 30 June 2015
Page 59
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
22.
Related Party Transactions (continued)
Payments totalling $47,143 (2014: nil) were made to Prueba Pty Ltd, a company associated with Mr Steve McGovern,
for platform testing consulting fees during the four months period since acquiring the Dubber business.
Intelligent Voice and 1300 MY SOLUTION are businesses associated with Mr Steve McGovern and Mr Adrian Di
Pientrantonio. The Group earned service fee income of $7,260 from Intelligent Voice and $51,327 from 1300 MY
SOLUTION during the four months since acquiring the Dubber business. Trade receivables at 30 June 2015 include
balances of $18,518 due from Intelligent Voice and $57,095 due from 1300 MY SOLUTION. $28,460 was paid to 1300
MY SOLUTION during the year.
The Company entered into sub-underwriting agreements for the renounceable rights share issue completed during the
previous financial year, with entities associated with two of its Directors. Coxrocks Pty Ltd (a company associated with
Mr Coxhell) and Kellen Investments Pty Ltd (a company associated with Mr Richards), as sub-underwriters, subscribed
for shares to the value of $4,500 and $65,000 respectively. The sub-underwriters received no fees for acting as sub-
underwriters.
During the year, Vault Pty Ltd, a company associated with Mr Pawlowitsch advance a short term loan of $50,000 to the
Company in January 2015. This amount was repaid in March with interest of $7,500.
Balances in trade creditors at 30 June 2015, include the amounts of $10,323 Mr Adrian Di Pietrantonio and $ 1,880 for
Mr James Slaney.
Amounts included in the remuneration table for Mr Gavin Campion and Mr Simon Coxhell were paid to their
consultancy companies Hydrya Plenus Pty Ltd and Coxrocks Pty Ltd respectively.
All transactions are conducted on normal commercial terms and on an arm’s length basis.
Annual Report - 30 June 2015
Page 60
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Consolidated
2015
$
2014
$
23.
Cash Flow Information
Reconciliation of loss for the year to net cash flows from operating activities
Net loss for the period
(3,535,621)
(950,999)
Non-cash flows in loss:
Depreciation and amortisation
Share based payments
Exploration expensed
Impairment of property, plant and equipment
Loss on disposal of subsidiary
Changes in assets and liabilities:
Increase in trade and other receivables
Increase in trade and other payables
Increase in provisions
Net cash outflows from operating activities
24.
Share Based Payments
Value of share based payments in the financial statements
Share based payments expensed – directors fees and benefits
Share based payments expensed – employee benefits expense
Share based payments expensed – consulting fees
Share based payments – capital raising costs
Summary of share based payments
Shares:
331,025
515,903
119,414
43,731
163,987
(22,060)
32,505
11,756
(2,339,360)
35,388
91,350
310,087
-
-
(71,730)
30,261
-
(555,643)
278,488
4,285
233,131
70,200
586,104
91,350
-
-
-
91,350
During the year, the Company issued 755,961 fully paid ordinary shares as consulting fees with a value of $151,192 to
advisors to the acquisition of Medulla Group Pty Ltd.
No shares were issued as share based payments during the previous financial year.
Annual Report - 30 June 2015
Page 61
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24.
Share Based Payments (continued)
Options:
Set out below are the summaries of options granted as share based payments:
2015
Grant
Date
Expiry
Date
Exercise
Price
Balance
01/07/14
Granted
Exercised
Expired or
Forfeited
Balance
30/06/15
26/09/11
13/12/11
23/02/12
25/11/13
15/12/14
27/02/15
9/06/15
30/06/15
26/09/14
13/12/14
23/02/15
25/11/16
31/01/18
27/02/18
30/06/18
31/03/19
$0.40
$0.40
$0.40
# $0.25
$0.25
$0.25
$0.40
$0.25
3,450,000
1,000,000
500,000
5,000,000
-
-
-
-
9,950,000
-
-
-
-
3,000,000
600,000
2,700,000
2,250,000
8,550,000
-
-
-
-
-
-
-
-
-
(3,450,000)
(1,000,000)
(500,000)
# (4,000,000)
-
-
-
-
(8,950,000)
-
-
-
1,000,000
3,000,000
600,000
2,700,000
2,250,000
9,550,000
Number
vested and
exercisable
-
-
-
1,000,000
3,000,000
600,000
-
-
4,600,000
Weighted average exercise price
$0.22
$0.30
$0.40
$0.29
$0.25
# - 1:5 consolidation of shares and options on 15/12/14
2014
Grant
Date
Expiry
Date
Exercise
Price
Balance
01/07/13
Granted
Exercised
Expired or
Forfeited
Balance
30/06/14
Number
vested and
exercisable
26/09/11
26/09/11
13/12/11
23/02/12
25/11/13
12/04/14
26/09/14
13/12/14
23/02/15
25/11/16
$0.40
$0.40
$0.40
$0.40
$0.05
6,500,000
3,450,000
1,000,000
500,000
-
11,450,000
-
-
-
-
5,000,000
5,000,000
-
-
-
-
-
-
(6,500,000)
-
-
-
-
(6,500,000)
-
3,450,000
1,000,000
500,000
5,000,000
9,950,000
-
3,450,000
1,000,000
500,000
5,000,000
9,950,000
Weighted average exercise price
$0.40
$0.05
$0.40
$0.22
$0.22
The assessed fair values of the options was determined using a binomial option pricing model or Black-Scholes model,
taking into account the exercise price, term of option, the share price at grant date and expected price volatility of the
underling share, expected yield and the risk-free interest rate for the term of the option. For the options granted during the
current financial year, the inputs to the model used were:
Grant date
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options (years)
Underlying share price ($)
Option exercise price ($)
Value of option ($)
15/12/2014
-
100%
2.045%
3.125
$0.20
$0.25
$0.13405
27/02/2015
-
100%
2.26%
3
$0.20
$0.25
$0.11700
9/06/2015
-
60%
1.79%
3.21
$0.394
$0.40
$0.1635
30/6/2015
-
100%
2.045%
3.75
$0.325
$0.25
$0.2344
Annual Report - 30 June 2015
Page 62
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
24.
Share Based Payments (continued)
The weighted average remaining contractual life of share-based payment options that were outstanding as at 30 June
2015 was 2.86 years (2014: 1.54 years).
The weighted average fair value of share-based payment options granted during the year was $0.16856 (2014:
$0.01827) each.
Performance shares:
Each performance share converts into one fully paid ordinary share for nil cash consideration, upon the achievement
of performance based milestones.
Set out below are the summaries of performance shares issued as share based payments:
2015
Grant
Date
Expiry
Date
Balance
01/07/14
28/11/14
27/02/15
27/02/15
9/06/15
27/05/17
27/02/15
27/08/15
30/06/18
-
-
-
-
-
Weighted average remaining
contractual life of performance
shares outstanding at end of period
Granted
during the
year
4,000,000(1)
204,848(2)
204,848(3)
1,800,000(4)
6,209,696
1.51
Converted
Forfeited
Balance
30/06/15
Vested and
exercisable
-
(204,848)
-
-
(204,848)
-
-
-
-
-
4,000,000
-
204,848
1,800,000
6,004,848
-
-
-
-
The various performance shares and options listed above are subject to milestone which are listed below.
Probability of achieving these milestones have been assessed at 100%.
(1)Milestone 1: Upon all of the following being achieved:
(a) enter into 1 Australian re-seller agreement for the Dubber technology suite;
(b) enter into re-seller and deployment partner agreement for the Dubber technology suite;
(c) enter into a re-seller integration partner agreement with 1 Australian based telecommunications
Carrier for the Dubber technology suite;
(d) enter into a partner agreement with a technology company which will assist with establishing a re-
seller/integration agreement for the Dubber technology suite in a jurisdiction outside of Australia .
Milestone 2: Upon all of the following being achieved:
(a) $30,000 (ex GST) in billed monthly revenue via channel Expiry
Milestone 3: Upon all of the following being achieved:
$100,000 (ex GST) ¡n billed monthly revenue via channel.
Milestone 4: Upon the following being achieved:
The Company breaking even, based on EBITDA over a rolling 3 month period. If this milestone is achieved,
then Milestones 1, 2 and 3 will be deemed achieved.
(2) Milestone: The Company attaining 1,000 paying end users
(3) Milestone: The Company attaining 3,000 paying end users by six months
(4) Milestone 1: The Company achieving a share price with a 20 day VWAP over 50C.
Milestone 2: The Company achieving a share price with 20 day VWAP over 75c. Milestone
Annual Report - 30 June 2015
Page 63
For personal use only
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Converted
Expired or
Forfeited
Balance
30/06/14
Vested
and
excersiabl
e
Granted
during the
year
-
-
-
-
(25,250,000)
(25,250,000)
-
-
-
-
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
2014
Grant
Date
Expiry
Date
Balance
01/07/13
26/09/11
26/09/14 25,250,000
25,250,000
0
Weighted average
remaining contractual
life of performance
shares outstanding at
end of period
25.
Parent Entity Disclosures
Summary Financial information
The individual financial statements for the parent entity show the following aggregate amounts:
Statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Total liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Loss for the year
Total comprehensive loss
2015
$
2014
$
1,635,053
8,538,430
10,173,483
93,850
93,850
10,079,653
1,757,777
883
1,758,660
105,598
105,598
1,653,062
17,622,778
5,252,839
(12,795,982)
10,079,635
10,140,779
1,015,293
(9,503,010)
1,653,062
(5,097,008)
(5,097,008)
(837,170)
(837,170)
The parent entity had no expenditure commitments or contingent liabilities at 30 June 2015 or 30 June 2014.
Annual Report - 30 June 2015
Page 64
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
26. Non-controlling Interests (NCI)
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
Set out below is summarised financial information for each subsidiary that has non-controlling interests that are
material to the group. Amounts disclosed are before intercompany eliminations.
Ownership interest held by non-controlling interests
Summarised statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net Assets
Accumulated NCI
Summarised statement of profit or loss and other comprehensive
income
Loss for the year
Other comprehensive income
Total comprehensive loss
Losses allocated to NCI
Summarised cash flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Foreign exchange movement
Net (decrease) in cash and cash equivalents
MAJOR STAR SA
2015
%
100
$
2014
%
10
$
20,899
60,801
81,700
2,207
1,336,586
1,338,793
(1,257,093)
(123,759)
-
-
-
-
-
-
-
-
(172,704)
(42,663)
(295,553)
(9,071)
(215,367)
(304,624)
(17,270)
(29,556)
-
(84,929)
135,874
(42,653)
-
(241,355)
192,902
(12,619)
8,292
(61,072)
Transactions with non-controlling interests
-
-
On 31 March 2015, the consolidated entity sold its 90% interest in Major Star SA (note 18).
Annual Report - 30 June 2015
Page 65
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
27.
Commitments
Operating lease commitments
Non-cancellable operating leases contracted for but not recognised in the
financial statements:
Payable – minimum lease payments
- Not later than one year
- After one year but not more than five years
Consolidated
2015
$
2014
$
148,383
532,508
680,891
-
-
-
Medulla Group Pty Ltd entered into a lease for the Group’s principal place of business on Russell Street in Melbourne
with an unrelated landlord which commenced on 24 October 2014. The initial term of the lease is five years, with an
option to extend for a further term of five years. Rental for the first year is $145,000 per annum, however the first five
months of the term is subject to a rent free period. On each anniversary of the lease commencement date, the rent
will be increased by a fixed rate of 3.5%.
The Company has not declared a dividend.
28.
Events Subsequent to Year End
There are no matters or circumstances that have arisen since 30 June 2015 that have or may significantly affect the
operations, results, or state of affairs of the Company in future financial years other than:
The Company announced on 2 September 2015 that the Group has registered 3,307 paying users as at 25 August 2015,
confirming the passing of the performance milestone of 3,000 paying users for the initial vendors of the Dubber
business. The Company also confirmed that the signing of the Go Cloud Master Distributer Agreement to establish a
re-seller network across Asia, was the final requirement in the first tranche of Management performance shares held
by Mr Gavin Campion, a director of the Company. Full details of all performance shares are set out in the Company’s
Prospectus dated 15 January 2015.
A fully paid ordinary share was issued for converting and cancelling each of the following performance shares upon
achieving the above performance milestones:
3,892,127 milestone 2 performance shares held by the vendors of Medulla Group Pty Ltd;
204,818 milestone 2 performance shares held the vendor’s advisors; and
1,000,000 milestone 1 Management performance shares held by Mr Gavin Campion.
The financial report was authorised for issue on 30 September 2015 by the board of directors.
Annual Report - 30 June 2015
Page 66
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
Directors’ Declaration
The directors of the company declare that:
DIRECTOR’S DECLARATION
1.
The financial statements and notes are in accordance with the Corporations Act 2001, and:
(a)
(b)
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements; and
give a true and fair view of the financial position of the Company as at 30 June 2015 and of its
performance for the financial year ended on that date.
2.
The Managing Director and CFO have each declared that:
(a)
(b)
the financial records of the company for the financial year have been properly maintained in
accordance with section 286 of the Corporations Act 2001;
the financial statements and notes for the financial year comply with the accounting standards;
and
(c)
the financial statements and notes for the financial year give a true and fair view.
3.
In the opinion of the directors’ there are reasonable grounds to believe that the company will be able
to pay its debts as and when they become due and payable.
4.
Note 1 confirms that the financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board.
This declaration is made in accordance with a resolution of the Board of Directors.
Peter Pawlowitsch
Director
Dated: 30 September 2015
Annual Report - 30 June 2015
Page 67
For personal use only
Tel: +61 8 6382 4600
Fax: +61 8 6382 4601
www.bdo.com.au
38 Station Street
Subiaco, WA 6008
PO Box 700 West Perth WA 6872
Australia
INDEPENDENT AUDITOR’S REPORT
To the members of Dubber Corporation Limited
Report on the Financial Report
We have audited the accompanying financial report of Dubber Corporation Limited, which comprises
the consolidated statement of financial position as at 30 June 2015, the consolidated statement of
profit or loss and other comprehensive income, the consolidated statement of changes in equity and
the consolidated statement of cash flows for the year then ended, notes comprising a summary of
significant accounting policies and other explanatory information, and the directors’ declaration of the
consolidated entity comprising the company and the entities it controlled at the year’s end or from
time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error. In Note 1(a), the directors also state, in accordance with Accounting Standard AASB 101
Presentation of Financial Statements, that the financial statements comply with International
Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our
audit in accordance with Australian Auditing Standards. Those standards require that we comply with
relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain
reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in
the financial report. The procedures selected depend on the auditor’s judgement, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or error.
In making those risk assessments, the auditor considers internal control relevant to the company’s
preparation of the financial report that gives a true and fair view in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the company’s internal control. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors, as
well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations
Act 2001. We confirm that the independence declaration required by the Corporations Act 2001, which
has been given to the directors of Dubber Corporation Limited, would be in the same terms if given to
the directors as at the time of this auditor’s report.
BDO Audit (WA) Pty Ltd ABN 79 112 284 787 is a member of a national association of independent entities which are all members of BDO Australia Ltd ABN
77 050 110 275, an Australian company limited by guarantee. BDO Audit (WA) Pty Ltd and BDO Australia Ltd are members of BDO International Ltd, a UK
company limited by guarantee, and form part of the international BDO network of independent member firms. Liability limited by a scheme approved under
Professional Standards Legislation, other than for the acts or omissions of financial services licensees.
For personal use only Opinion
In our opinion:
(a)
the financial report of Dubber Corporation Limited is in accordance with the Corporations Act
2001, including:
(i)
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2015
and of its performance for the year ended on that date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in
Note 1(a).
Emphasis of matter
Without modifying our opinion, we draw attention to Note 1 (b) in the financial report, which indicates
that the ability of the consolidated entity to continue as a going concern is dependent upon the future
successful raising of necessary funding through equity. These conditions, along with other matters as
set out in Note 1 (b), indicate the existence of a material uncertainty that may cast significant doubt
about the consolidated entity’s ability to continue as a going concern and therefore, the consolidated
entity may be unable to realise its assets and discharge its liabilities in the normal course of business.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 30 June
2015. The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
Opinion
In our opinion, the Remuneration Report of Dubber Corporation Limited for the year ended 30 June
2015 complies with section 300A of the Corporations Act 2001.
BDO Audit (WA) Pty Ltd
Jarrad Prue
Director
Perth, 30 September 2015
For personal use only DUBBER CORPORATION LIMITED
ABN 64 089 145 424
ASX INFORMATION
FOR THEYEAR ENDED 30 JUNE 2015
Additional Shareholder Information
The following additional information is current as at 25 September 2015.
SUBSTANTIAL SHAREHOLDERS
There are no substantial holders.
RANGE OF HOLDING – ORDINARY SHARES
HOLDERS
SHARES
1 – 1,000
1,001 – 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and above
There are 356 shareholders with less than a marketable parcel.
VOTING RIGHTS
Each fully paid ordinary share carries voting rights of one vote per share.
THE TOP 20 HOLDERS OF ORDINARY SHARES ARE:
NAME
BNP PARIBAS NOMINEES PTY LTD
STEVE MCGOVERN NOMINEES PTY LTD
ALTA HOLDINGS PTY LTD
DIPZHOU PROPERTY MANAGER PTY LTD
PENELOPE SLANEY
SLANEY HOLDINGS PTY LTD
HSBC CUSTODIANS NOMINEES PTY LTD
LYDIAN ENTERPRISES PTY LTD
EARTHRISE HOLDINGS PTY LTD
JP MORGAN NOMINEES PTY LTD
RANK
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11. MORPARQ PTY LTD
AXIAS GROUP PTY LTD
12.
13. MADACHI HOLDINGS PTY LTD
14. MR B DUETSCHER
PETERLYN PTY LTD
15.
JAKANA PTY LTD
16.
P J HERBERT
17.
ZAV40 INVESTMENTS PTY LTD
18.
CHRIS JACKSON
19.
FENCOURT ENTERPRISES PTY LTD
20.
423
193
120
362
111
1,209
96,388
529,630
993,465
15,397,194
41,476
58,492,814
UNITS
2,453,172
2,430,961
2,000,000
1,945,361
1,875,989
1,875,983
1,839,352
1,700,000
1,000,000
880,543
800,000
636,596
554,972
522,500
520,000
500,000
500,000
482,500
456,942
450,000
% OF UNITS
4.19
4.16
3.42
3.33
3.21
3.21
3.14
2.91
1.71
1.51
1.28
1.09
0.95
0.89
0.89
0.85
0.85
0.82
0.78
0.77
Totals: Top 20 holders of ORDINARY SHARES (TOTAL)
23,424,871
39.96
Annual Report - 30 June 2015
Page 70
For personal use only
DUBBER CORPORATION LIMITED
ABN 64 089 145 424
ASX INFORMATION
FOR THEYEAR ENDED 30 JUNE 2015
UNQUOTED EQUITY SECURITIES
Number
1,000,000
Number of
Holders
5
+Class
Escrow Period
Options exercisable at 25 cents
expiring 25 November 2016
2,190,000
17
Ordinary Shares
27 February 2016
6,709,254
4,451,800
3,000,000
12,630,790
4,781,328
6
6
1
6
3
Ordinary Shares
Ordinary Shares
12 months from quotation
24 months from quotation
Management Performance Shares
24 months from quotation
Performance Shares
12 months from quotation
Performance Shares
24 months from quotation
2,920,000
17
Unlisted options exercisable at 25
cents expiring 31/1/2018
27 February 2016
680,000
1,800,000
2,700,000
2,250,000
3
7
7
8
Unlisted options exercisable at 25
cents expiring 27/2/2018
24 months from quotation
Performance Shares
Performance Options
Unlisted options exercisable at 25
cents expiring 31/3/2019 vesting
1/3/2016, 1/3/2017, 1/3/2018
Annual Report - 30 June 2015
Page 71
For personal use only