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AppenDUBBER CORPORATION LIMITED
ABN 64 089 145 424
Annual Report
30 JUNE 2020
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Contents
01.
Vision & Mission ............................................................................................ 3
02. Corporate Directory .................................................................................... 4
03. Chairman’s Letter .......................................................................................... 5
04.
Highlights ........................................................................................................... 8
05. Core Strategy .................................................................................................. 9
06. CEO & Operations Report .....................................................................10
07.
Remuneration Report .............................................................................. 26
08. Notes to the Consolidated Financial Statements ..................47
09. Director’s Declaration ..............................................................................85
10.
Independent Auditors Report ............................................................86
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DUBBER.NETDUBBER ANNUAL REPORT 2020
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Vision &
Mission
VOIC E DATA &
AI STARTS HER E
We are the voice of the network and platform for the
worlds leading communications service and solution
providers.
Dubber is the world’s leading Unified Call Recording platform
(UCR) inside leading Service Provider networks & communications
solutions globally. Provisioned with a click, UCR enables voice data
solutions to be generated from every conversation and delivered
to Dubber’s infinitely scaleable Voice Intelligence Cloud where AI
creates insights, intelligence, beautiful transcriptions and more.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
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Corporate
Directory
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BOARD OF DIRECTORS
Peter Clare
Non-Executive Chairman
Steve McGovern
Managing Director
Peter Pawlowitsch
Non-Executive Director
Gerard Bongiorno
Non-Executive Director
Ian Hobson
Company Secretary
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AUDITOR
BDO Audit (WA) Pty Ltd
38 Station Street
Subiaco WA 6008
4
SHARE REGISTRY
Automic Registry Services (Automic Pty Ltd)
Level 5, 126 Phillip Street, Sydney NSW 2000
Within Australia
Outside Australia
1300 288 664
+61 2 9698 5414
SECURITIES EXCHANGE
Dubber Corporation Limited shares are listed on the
Australian Securities Exchange
ASX Code: DUB
PRINCIPAL PLACE OF BUSINESS
AND REGISTERED OFFICE:
Level 5, 2 Russell Street
Melbourne VIC 3000
www.dubber.net
SOLICITOR
Milcor Legal Solicitors
Level 1, 6 Thelma Street
West Perth WA 6005
BANKER
Westpac Banking Corporation Limited
150 Collins Street
Melbourne VIC 3000
DUBBER.NETDUBBER ANNUAL REPORT 2020
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Chairman’s
Letter
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DUBBER.NETDUBBER ANNUAL REPORT 2020
DEA R SH AREH OLDERS
The 2020 financial year has been a different year with the world having to deal with a
global pandemic, making a top priority of the Company being the health and wellbeing
of its employees. Thankfully so far, there has been no major issues amongst our team. On a
business level, the year saw Dubber take significant steps towards its “AI for every phone”
strategy whilst further building partner relationships and the core business.
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The Company’s key metrics showed strong increases
through the year. In the 12 months to 30 June 2020:
• More active users were added over the last 12
months than the entire history prior;
Active users increased by 103% to 192,544 (2019:
94,825);
• Operating revenue grew from $5,547,540 to
$9,649,834; a 75% increase;
Telecommunication service providers billing
increased by 93% to 83;
The Company successfully completed a capital
raising in April 2020, totalling $10m.
The Company also completed the acquisition of
Australian call recording company CallN in May
2020 expanding the Company’s footprint in the call
recording space.
The Dubber Platform and core operating plan
continues to:
• Deliver Call Recording and AI onto leading global
telephony networks;
• Grow the customer base and associated
revenues;
deployments;
• Convert commercial agreements into billing
•
Fulfill substantial increases in demand as
enterprises seek distributed workforce
capabilities;
• Develop the Cisco Webex Calling program;
• Develop the go to market program for wide
availability in Australia via Telstra.
6
During the year, Dubber took significant steps in
a challenging economic and social environment
presented due to COVID-19 with many of the
businesses targeted by our telecommunications
service provider partners, impacted by business
closures and declines in their operations.
The capital raising undertaken in April 2020 provided a
significant financial buffer and enabled the business to
evaluate growth opportunities, further scale business
resources around the world and close acquisition
targets, such as that of CallN Pty Ltd.
As we move into the 2021 financial year, the Company
is well placed to capitalise on the move to working
from home and the delivery of services via the cloud
and continue to execute its global growth agenda.
On behalf of the Board, I would like to thank all
staff and contractors for their contribution to the
continuing growth and development of the Company.
I would also like to thank our shareholders for their
continued support.
Yours faithfully,
Peter Clare
Non-Executive Chairman
DUBBER ANNUAL REPORT 2020DUBBER.NET
Highlights
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75% INCREASE IN OPERATING REVENUE
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$5.54m
$9.65m
OPERATING REVENUE IN 2019
OPERATING REVENUE IN 2020
103% INCREASE IN USERS
94,825
USERS IN 2019
192,544
USERS IN 2020
30% INCREASE IN TELECOMMUNICATION PROVIDERS
106
138
TELECOMMUNICATION
PROVIDERS IN 2019
TELECOMMUNICATION
PROVIDERS IN 2020
$18.4m CASH AT BANK AT 30 JUNE 2020
7
DUBBER ANNUAL REPORT 2020DUBBER.NET
Core Strategy
Dubber’s core strategy continues to be that of achieving scale via indirect channels. These
channels are engaging Dubber directly with large enterprise customers in Australia and the
USA who are seeking to capture and manage as many of their customer interactions, and
thereby their data, as possible in order to determine market insights and create business
productivity outcomes.
The ability for large enterprises to go beyond contact centres and switch on recording
and AI immediately - available from their service providers - for larger sections of their
businesses, is a very compelling proposition. Dubber is well placed to provide these
services and has been active in designing potential solutions with a number of large
enterprise businesses that the Company believes will become “industry” references.
Our Strategy Simplified
To ‘dub’ every
communications
service in the
world – voice,
video, chat and
more
To unlock
the power of
voice data for
Government,
Service & Platform
Providers, and
Enterprises
Globally
Realizing the
potential of Voice
data as a Service
1
DUBBER ON EVERY NETWORK
AND COMMUNICATIONS SOLUTION
GLOBALLY
> AI on every phone and end-point
fueling the Voice Intelligence Cloud
2
AI POWERED & CONNECTED
INTELLIGENCE & INSIGHTS
> Create more value for customers than
ever before through data, connections
and integrations
3
WIN AND SERVE EFFICIENTLY WITH
PARTNERS – CHANNEL 1st
> Create network effects with
every end-point and user creating
incremental growth
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DUBBER.NETDUBBER ANNUAL REPORT 2020
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CEO &
Operations
Report
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DUBBER.NETDUBBER ANNUAL REPORT 2020
The 2020 financial year represented a step change for Dubber.
The Company had previously focused on laying the foundations for future success
by engaging with leading global service and unified communications solutions
providers in the knowledge that expansion of the worldwide network footprint
provides a large-scale addressable market.
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→ To increase the number of user subscriptions quarter-on-quarter:
In the year ended 30 June 2020, the Company began experiencing early-stage
commercial growth with user numbers increasing from 94,825 at June 2019 to 192,544
at June 2020, culminating in record growth of 26% in the final June quarter.
While indicative of potential, the Company still sees this as nascent growth, with
revenues relating mainly to recording users.
→ To increase revenue from users of the Dubber platform
The Company’s Annual Recurring Revenue grew from $8.22m at June 2019 to
$16.08m at June 2020 (+95%). The Company expects to continue its growth
trajectory in FY21 as the Dubber Platform is deployed more extensively both with
new networks and within existing service provider partnerships. The Company
also expects to increase its revenue profile in terms of billing for additional AI
services, richer product functionality, third-party integrations, and new billing and
consumption models.
→ To increase the global footprint across telecommunications service providers
Procurement of network agreements continues to be a strong focus of the
Company. During the year, the Dubber service went live with some of the world’s
largest tier one carriers such as Verizon, Sprint, Telstra and Cisco Webex Calling. As
the markets for both compliance recording and AI/data insights grow exponentially,
these deployments should contribute significantly to the Company’s commercial
outcomes for many years.
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The 2019 Annual Report
outlined the fundamental
goals of the Company for
FY20 as being;
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DUBBER ANNUAL REPORT 2020DUBBER.NET
C O R E P H I LO S O P H Y, T EC H N O LO GY A DVA N TAG E A N D G LO BA L
A D D R E S SA B L E M A R K E T: U N I F I E D C A L L R EC O R D I N G
The Company has three
underlying commercial
philosophies.
01
Call Recording should be available, immediately, as a
Service directly from the telephony network or unified
communications solution.
02
Artificial Intelligence should be enabled for every carrier network
and communications service with voice data centralized and
managed securely and compliantly in the cloud.
03
Hyper-scale Unified Call Recording and Voice AI is a source
of advantage for Dubber, and its application will accelerate
with the continued evolution of the Dubber Voice Intelligence
Cloud. This fuels our business model with both a competitive
and economic advantage by enabling any call recording,
from any source to be unified on one platform to provide
integrated reporting, alerts, search and more.
Dubber is globally recognized as the Cloud Call Recording and Voice
Data Capture platform for Communications Service & Solution Providers
and as integral to their Unified Communications offerings. Dubber’s
unique technology enables call recording to be delivered as a service.
It turns voice calls into data enabling broad-reaching AI services to be
deployed at scale directly from a Carrier network - or from inside a
Solution Provider’s infrastructure. Dubber services are presented either
in the brand of the Carrier or as Dubber products.
The Dubber Platform is the only one of its kind, built to operate the same
way a service provider provisions its services, as opposed to providing
applications or hardware at an individual enterprise or business level.
The integration of the Dubber Platform at a network level underpins the
strategy and commercial opportunity for the business. Once deployed,
the Dubber Platform is invariably the only network call recording and data
capture technology in a service provider network and the potential for the
service to be terminated at any point in the future is low.
There was zero ‘churn’ in terms of network deployments during FY2020.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
01
02
On a macro level, this significantly increases the addressable
market
At a network level, service providers have a ubiquitous
recording and data capture platform across multiple ‘fixed’,
unified and mobile networks
03
At an enterprise level, businesses can, for the first time
seek to record calls and capture voice data across the
whole of business on multiple devices served by numerous
communications platforms and networks
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For the first time, all conversations – on or off the service and
solution providers’ offerings – can be made available securely and
compliantly in one place, affording even richer data, insights and
integrations
05
In line with our core strategy, we made progress in realizing
the advantages of our open API, which allows this data to be
integrated with, and viewed in widely used applications such as
Salesforce.com
In FY2021, Dubber will have the opportunity to capitalize on
its unique position as the provider of ‘Unified Call recording’.
FY2020 saw the start of deployment
of the Dubber platform into mobile
networks and unified communications
solutions platforms.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Continued growth
in end users
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2 0 0,0 0 0
1 8 0,0 0 0
1 6 0,0 0 0
1 4 0,0 0 0
1 2 0,0 0 0
1 0 0,0 0 0
8 0,0 0 0
6 0,0 0 0
4 0,0 0 0
2 0,0 0 0
0
F Y1 7
F Y1 8
F Y1 9
F Y2 0
r
F Y1 6
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During the year, the Company continued to grow active users from
the agreements procured in the past few years, across Australia, Europe
and North America. These active users represent customers who have
taken the service predominately for compliance and regulatory reasons.
As at 30 June 2020, there were 192,544 active users, representing annual
growth of 103%.
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DUBBER.NETDUBBER ANNUAL REPORT 2020
FY20
Key Highlights
ARR CAGR
151% Since FY18
REVENUE CAGR
93% Since FY18
USER CAGR
152% Since FY18
CHURN RATE
3.7% Since FY18
CASH AT BANK
$18.4m EOFY20
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Annualised Recurring
Revenue (AUD $’000s)
16,000
12,000
8,000
4,000
0
FY17
FY18
FY19
FY20
F Y1 7
F Y1 8
F Y1 9
F Y2 0
AR
$740k
$2.55m
$8.22m
$16.10m
REVE NUE
$1.96m
$3.18m
$7.39m
$11.84
MC
21m
59m
250m
235m
USERS
8,606
29,405
94,824
192,544
S P C O NTR ACTED
S P BI LL ING
22
8
38
23
106
43
138
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DUBBER.NET
Carrier Growth — YOY
Over the coming years, Dubber expects its service to
be available on multiple carrier networks within each
of its existing relationships, with a notable expansion
into mobile offerings.
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74%
CAGR
93%
CAGR
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19
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BILLI N G
CONT RAC TED
142
87
106
43
15
FY1 7
FY1 8
FY1 9
FY20
DUBBER ANNUAL REPORT 2020
SCALI NG BU SINESS OPERATIO NS
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The Company had previously conducted a capital raising in
April 2019. It was able to deploy these funds to expand its
technology capability and establish the first layer of executive,
sales and support personnel in each of its operating territories
- APAC, North America and Europe.
Many essential roles have been filled with personnel with
significant experience of major service and solution provider
go-to-market approaches and technologies.
From an employment perspective, the attraction of the
Company is that the Dubber Platform extracts content from
voice calls on a network with potentially endless use cases and
commercialization opportunities for that data and content.
Scaling to Meet Opportunities
48
NEW
NEW ROLES
WITHIN DUBBER
CHIEF MARKETING OFFICER
GLOBAL SALES DIRECTOR
ACCOUNT MANAGERS
ENTERPRISE SALES
SENIOR ACCOUNT DIRECTORS
CHANNEL MANAGERS
SOLUTIONS ENGINEERS
SENIOR SOLUTIONS ENGINEERS
CHANNEL MARKETING EXECUTIVES
113
TOTAL
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DU BBE R GLO BA L TEAM
NEW
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Notable events in FY2020
CISC O WEBEX CA LLING
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TELSTR A
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VERIZO N
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FY2020 saw Cisco launch their Cloud telephony platform, Cisco Webex Calling, with
Dubber embedded as the recording and data capture service.
With over 90m existing customers of hardware or hosted PBX phone systems, Cisco
has an enormous opportunity for conversion to its preferred Cloud Phone offering and,
in turn, this provides a substantial addressable market for Dubber.
The Dubber service is integrated into Cisco’s standard ordering and provisioning
systems enabling call recording and associated services to be ordered and switched
on as part of the Cisco Webex Calling feature stack without the need for scoping,
hardware or professional services.
The Cisco Webex calling program has seen engagement with large enterprise
customers, particularly in the banking, financial services and health care sectors.
The lead time from ordering a new service to deployment and, thereby, billing can
be 60 days for a typical medium-sized business. Where the business is a large
enterprise, there may be additional compliance processes and documentation
which are required as a part of the sales process. Dubber has seen strong
demand from these types of enterprises in the USA, Canada and Europe. These
engagements will provide the Company with a measurable and predictable growth
profile as demand increases globally.
Dubber services went to general availability via the Telstra TIPT, SIP Connect and
Liberate services at the end of June.
Initially, the Company had focused on providing services in a limited deployment
process for pre-engaged customers.
As with the Cisco Webex Calling initiative, there is a requirement for BCP solutions at
an enterprise level where, particularly in the financial services sector, mobile recording
directly from the network has significant scope. At the end of June, the Company was
undertaking limited deployment programs with two national financial services firms
for mobile recording, intending to broaden the scope subsequently. Wide availability for
recording on Dubber via Telstra TIPT, SIP Connect and Liberate was scheduled to be
co-launched via Telstra’s internal sales and external dealer channel in Q1 FY2021.
In the March quarter, the Company signed a Master Service Agreement (MSA) with
Verizon Communications, the world’s second-largest telecommunications carrier.
The MSA provides for Verizon to deploy Dubber to any of its networks without the
need for protracted procurement processes enabling ubiquitous offerings across
its customer base.
The first networks deployed are Verizon’s Unified Communications offerings for
which Verizon are a recognized world leader and additionally include their own
Cisco Webex Calling initiative. Dubber subscriptions were enabled from the outset
of this agreement and, at the end of June, the Dubber platform was being scoped
for expanded network deployments in 2021.
DUBBER ANNUAL REPORT 2020DUBBER.NET
At the outset of the COVID-19 pandemic, there was initial global uncertainty with
many businesses experiencing unprecedented downturns.
The Company’s technology and those of its partners provides communications
services from cloud or hosted platforms designed to unify distributed workforces
via a centralized capability.
As businesses of all sizes moved to work from home, these technologies have
never been more important or relevant, and the Company decided to conduct a
conservative capital raise to provide certainty among its key stakeholders, including
employees, customers, partners and shareholders.
Dubber is moving forward at a time when many businesses are not. The capital
raise was exceptionally well supported in terms of applications, with the Company
electing to accept $10m, including a $1m placement from Directors subject to
shareholder approval. The Company believes that the placement had the desired
effect of reinforcing confidence in the height of the COVID-19 global outbreak.
At June 2020 the Company reported cash reserves of $18.4m.
In June, the Company completed the acquisition of CallN, an Australian ‘on
premise’ Call Recording company with historical links to Telstra. With the
acquisition, the Company gained a small group of skilled employees, existing
arrangements with Telstra which augmented its network deployment agreement
and a sales contribution which adds directly to the Company’s revenue line. The
Company expects to have received revenues within the first year that effectively
pay for the acquisition.
On 21 February 2020, Dubber was included in the inaugural S&P/ASX All Technology
Index (XTX). A total of 46 foundation members were included across a range of
industries that are engaged in the technology sector.
In June Dubber was added to the ASX All Ordinaries Index which reflects the top
500 largest ASX listed companies across all sectors.
CAPITAL RAISE IN
APRIL 2020
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CALLN ACQUISITION
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S&P ASX ALL TECHNOLOGY
INDEX (XTX)
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ASX ALL ORDINARIES INDEX
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DUBBER ANNUAL REPORT 2020DUBBER.NET
We enter the new fiscal year with a strong
foundation for growth:
→ A growing pipeline of orders via our existing partner
networks and channels
→ Continued deployment into tier one carrier networks
including native integration into one of the world’s largest
mobile networks
→ New billing methods for our services including
consumption and AI subscriptions
→ Exponential growth in the requirement for AI insights
and outcomes which will drive the need for voice data at
massive scale across the whole of businesses
→ Service Providers seeking to bundle a version of Dubber’s
services as a standard offering within business plans for
every user
→ Our capacity to continue to scale the operating team in
crucial revenue-generating roles
Our core philosophies will remain the same - call recording
should be available as a ‘switch on’ feature as part of
a communications service and AI capability, including
transcription, data-driven insights, and more will become a
standard feature expectation as part of a communications
service and embedded in every business’s daily activity.
Outlook
FY2020 saw the Company achieve several
milestones which will have an impact on its
long-term future, particularly in the area of
network and solutions deployments. We also
saw growth in all our key metrics, including
subscriptions and annual recurring revenue.
The Company enters FY2021 with strong
expectations regarding its continued commercial
growth, accelerated by the economic climate
and the requirements for businesses to bring
forward their communications transition as
part of Business Continuity Planning; the need
to address compliance mandates; and, improve
customer experience.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
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Directors’
Report
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DUBBER ANNUAL REPORT 2020
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STEVE MCGOVERN
Experience
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Interest in Shares and Options/
Rights at the date of this report
Directorships held in other listed
entities in the past three years
MR PETER CLARE
Experience
Your directors present their report of Dubber Corporation Limited and its
controlled entities (the Group) for the financial year ended 30 June 2020.
Directors have been in office since the
start of the financial year to the date of
this report unless otherwise stated.
Directors
Steve McGovern
Managing Director
Peter Clare
Non-Executive Chairman
Peter Pawlowitsch
Non-Executive Director
Gerard Bongiorno
Non-Executive Director
The particulars of the qualifications, experience and special responsibilities of each director are as follows:
MANAGING DIRECTOR
Mr McGovern is a founder of Dubber Pty Ltd. He has over 25 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.
• 7,747,328 ordinary shares held indirectly
• Linius Technologies Limited (April 2016 – present)
NON-EXECUTIVE CHAIRMAN
Peter is a highly experienced senior executive with an active interest in technology
and innovation and has a number of private equity investments in fintech and other
new technology businesses. He also holds a number of other non-executive director
positions with independent companies/businesses.
He was previously Managing Director and Chief Executive Officer for Westpac in New
Zealand and held Group Executive roles at Westpac, Commonwealth and St George
banks in Australia, with responsibility for Strategy, Mergers and Acquisitions, Product,
Operations, Technology, Property and Procurement. His background also includes
Insolvency Accounting and Management Consulting.
Peter’s qualifications include a BCom and MBA. He is a member of the Australian
Institute of Company Directors, a Fellow of the Governance Institute of Australia,
the Financial Services Institute of Australasia, and Certified Practicing Accountants
Australia.
Interest in Shares and Options/
• 765,000 ordinary shares held indirectly
Rights at the date of this report
Directorships held in other listed
• Change Financial Limited (April 2015 – August 2018)
entities in the past three years
21
• Scottish Pacific Group Limited (December 2014 – January 2019)
DUBBER ANNUAL REPORT 2020DUBBER.NET
MR PETER PAWLOWITSCH
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Experience
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Interest in Shares and Options/
Rights at the date of this report
NON-EXECUTIVE DIRECTOR
Mr Pawlowitsch holds a Bachelor of Commerce from the University of Western
Australia, is a current member of the Certified Practicing Accountants of Australia, a
Fellow of the Governance Institute of Australia and also holds a Master of Business
Administration from Curtin University.
These qualifications have underpinned more than fifteen years’ experience in the
accounting profession and more recently in business management and the evaluation
of businesses and projects.
• 3,409,348 ordinary shares held indirectly
Directorships held in other listed
• VRX Silica Limited (February 2010 – present)
entities in the past three years
l
• Knosys Limited (March 2015 – present)
• Novatti Group Limited (June 2015 – present)
• Rewardle Holdings Limited (May 2017 – January 2019)
• Family Zone Cyber Safety Limited (September 2019 – present)
NON-EXECUTIVE DIRECTOR
Mr Bongiorno is Principal and Co-CEO of Sapient Capital Partners, a merchant banking
operation and has over 30 years of professional experience in capital raisings and
corporate advisory. Prior to forming Sapient (formerly Otway Capital), Gerard was Head
of Property Funds Management at Challenger Financial Services Group (CFG) and was
Group Special Projects Manager at Village Roadshow. Earlier in his career he worked
at KPMG in insolvency and corporate Finance. Gerard received his Bachelor Degree in
Economics and Accounting from Monash University and the Program for Management
development at Harvard Business School PMD75.
• 792,111 ordinary shares held indirectly
• Linius Technologies Limited (February 2017 – present)
Experience
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MR GERARD BONGIORNO
Interest in Shares and Options/
Rights at the date of this report
Directorships held in other listed
entities in the past three years
22
DUBBER ANNUAL REPORT 2020DUBBER.NET
Company Secretary
Mr Ian Hobson, the Company Secretary since 17 October 2011 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.
Corporate Information
CORPORATE ST RUCTURE
Dubber Corporation Limited is a limited liability company that is incorporated and
domiciled in Australia. Dubber Corporation Limited has prepared a consolidated
financial report incorporating the entities that it controlled during the financial year as
follows:
Dubber Corporation Ltd
Medulla Group Pty Ltd
Dubber Pty Ltd
Dubber Ltd (UK)
Dubber USA Pty Ltd
Dubber, Inc.
Dubber Connect Australia Pty Ltd
CallN Pty Ltd
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parent entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
100% owned controlled entity
PR INCI PA L AC TIV ITIES
The principal continuing activities of Dubber Corporation Limited and its controlled
entities consisted of provision of call recording and audio asset management in the cloud.
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DUBBER.NETDUBBER ANNUAL REPORT 2020
Operating and
Financial Review
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.
OPERATING RESULTS
The loss from ordinary activities after providing for income
tax amounted to $18,000,260 (2019: $9,648,672).
FINANCIAL POSITION
At 30 June 2020 the Group had net assets of $25,546,379
(2019: $28,024,932) and cash reserves of $18,408,881 (2019:
$19,618,245).
DIVIDENDS
No dividends were paid or declared during the year. No
recommendation for payment of dividends has been made.
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DUBBER.NETDUBBER ANNUAL REPORT 2020
Significant changes
in the state of affairs
Events subsequent
to balance date
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Likely developments
and expected results
of operations
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:
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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.
The Company completed a $35,000,000 placement in October 2020. In addition, the
Company announced a Share Purchase Plan to existing shareholders. This is due to
complete in November 2020 for the purchase of new fully paid ordinary shares capped at
$6,000,000.
Following an external independent review the Company established a new executive
remuneration framework to apply with effect from 1 July 2020. The review also included
recommendations on the design and operation of short term and long term incentive
plans for the Company’s executives. As a result of this review, new executive service
agreements were entered into with Managing Director, Mr Stephen McGovern. In addition
the review resulted in a change of role for Mr Peter Pawlowitsch from Non-Executive
Directive to Executive Director - Commercial and Strategy, under a new executive service
agreement. These new agreements will be effective from 1 July 2020.
Further information is available in the Notice of Meeting and a separate announcement to
the market both made on 27 October.
The full impact of the COVID-19 outbreak, continues to evolve at the date of this report. The
Group is therefore uncertain as to the full impact that the pandemic will have on its financial
condition, liquidity, and future results of operations during FY2021.
Management is actively monitoring the global situation and its impact on the Group’s
financial condition, liquidity, operations, suppliers, industry, and workforce. Given the
daily evolution of the COVID-19 outbreak and the global response to curb its spread,
the Group is not able to estimate the effects of the COVID-19 outbreak on its results of
operations, financial condition, or liquidity for the 2021 financial year. No other matters or
circumstances have arisen, since the end of the financial year.
The Group will continue to pursue its principal activity of rolling out and developing its
cloud based call recording and audio asset management platform.
DIRECTORS' MEETINGS
Number eligible
Number
to attend
attended
Mr Steve McGovern
Mr Peter Clare
Mr Peter Pawlowitsch
Mr Gerard Bongiorno
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Remuneration
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DUBBER.NET
DUBBER ANNUAL REPORT 2020
Remuneration Report
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
Managing Director
Peter Clare
Non-Executive Chairman
Peter Pawlowitsch
Non-Executive Director
Gerard Bongiorno
Non-Executive Director
Other persons that fulfilled the role of a key management
person during the year, are as follows:
James Slaney
General Manager
Chris Jackson
Chief Technology Officer
Peter Curigliano
Chief Financial Officer
Russell Evans
Global Sales Director
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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.
Broadly, remuneration levels for
key management personnel of the
Company and 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. During the
year, the Board implemented an
independent review of its remuneration
policies to come into effect from 1 July
2020. As at the date of this report,
the new policies and framework were
finalised and hence will be applied
retrospectively from 1 July 2020,
and furthermore were disclosed to
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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 Consolidated Entity.
shareholders in a Notice of Meeting
based vesting conditions.
released to the share market on 27
October 2020 for the approval of
the equity component of the related
parties.
A cash bonus of $150,000 was paid
or accrued to Mr Steve McGovern
(2019: $150,000). Mr McGovern’s
bonuses are awarded for achieving key
The following is what was in place
performance indicators as determined
during the 2020 financial year:
by the Board on a six-monthly basis.
Bonuses of $40,000 and $35,000
were also paid to key management
personnel Mr James Slaney and Mr
Russell Evans respectively in line with
the achievement of key performance
indicators.
Remuneration packages can consist
of fixed remuneration including base
salary, employer contributions to
superannuation funds, cash bonuses
and non-cash benefits.
The Company has a variable
remuneration package for directors,
which involves Performance Rights but
none were issued for the 2020 financial
year. This plan allows directors to
convert Performance Rights to fully
paid ordinary shares for nil cash
consideration, subject to performance
DUBBER.NETDUBBER ANNUAL REPORT 2020
FIXED R EMU N ERATION
NON-EXECUTIVE DIRECTORS
Total remuneration for all non-executive directors, last voted
upon by shareholders at the 2014 Annual General Meeting,
is not to exceed $500,000 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 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.
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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 (note
executive directors remuneration was not reviewed
during the year as a new policy and framework was being
developed).
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, unless otherwise specified by any
non-executive and consultancy service agreement in place,
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.
SERV ICE AG REEMENTS
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.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Share-based Payment
Arrangements
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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. The options are not exercisable until the vesting date
provided the participant is an employee at the relevant vesting date.
OPTIONS
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The directors, at their discretion, may issue shares to participants under the
Employee Share Plan (“ESP”) at any time, having regard to relevant considerations
such as the participant’s past and potential contribution to the Company, and
their period of employment with the Company. Directors of the Company, full-
time employees and part-time employees of the Group who hold a salaried
employment or office in the Group, are eligible to participate in the ESP.
Plan shares may be issued at an issue price to be determined by the Board, which
may be a nominal or nil issue price if so determined by the Board. The number of
plan shares issued is determined by the Board.
The plan shares are issued on the same terms as the fully paid ordinary shares of
the Company and rank equally with all of the Company’s then existing shares.
The Board may impose conditions in an offer of plan shares that must be satisfied
(unless waived by the Board in its absolute discretion) before the plan shares
to which the condition applies can be sold, transferred, assigned, charged or
otherwise encumbered.
Where a restriction condition in relation to plan shares is not satisfied by the
due date, or becomes incapable of satisfaction in the opinion of the Board, the
Company must, unless the restriction condition is waived by the Board:
a) Where the plan shares were issued for no cash consideration, buy back the
relevant plan shares within 12 months of the date the restriction condition was
not satisfied (or became incapable of satisfaction) at a price equal to $0.0001
per share; or
b) Where the shares were issued for cash consideration, use its best endeavours
to buy back the relevant plan shares within 12 months of the date the
restriction condition was not satisfied (or became incapable of satisfaction)
at a price equal to the cash consideration paid by the participant for the plan
shares.
To date, plan shares offered under the ESP vest in three equal tranches on each
of the three consecutive annual vesting dates. The shares are not issued to the
participant until the vesting date provided the participant is an employee at the
relevant vesting date.
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LOAN F UND ED S HA R ES
Loan funded shares offered under the plan may be issued to
the participant or purchased on-market, at the discretion of
the Board. It is the Board’s present intention that loan funded
shares will be issued to participants.
Participants will acquire loan funded shares at market value
as at the grant date using a loan provided by the Company.
The loan will be interest-free and limited recourse in
accordance with the loan terms and the plan rules. The plan
rules require the loan to be repaid before a participant can
sell their shares.
The Board has the discretion to impose such vesting
conditions in relation to the loan funded shares as it deems
appropriate. These may include conditions relating to
continued employment or service, performance (of the
participant or the Company) and the occurrence of specific
A participant must not sell, transfer, encumber or otherwise
deal with a loan funded share unless otherwise permitted
under the plan or determined by the Board. The loan funded
shares will not be quoted on ASX and, at the discretion of the
Company, will be the subject of a “holding lock”, restricting
the participant’s ability to trade the shares.
Forfeiture conditions apply at all times while each participant
holds loan funded shares, such that the participant will
forfeit their interest in the loan funded shares where the
participant is determined by the Board to:
• be a leaver;
• be in breach of any terms of the loan; or
fail to satisfy the vesting conditions.
Participants will be invited to purchase shares using loan
funds under a loan agreement with the Company. The loan
must always be repaid if the participant wishes to benefit
from the shares. Participants only benefit from growth in
share price.
The loan commences on the grant date and, subject to
the Board’s discretion to permit the loan to continue for a
further specified period, must be repaid by the earliest of the
following:
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• five years from the grant date;
•
the date the participant ceases employment,
engagement or directorship with the Company;
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•
the date the loan funded shares are forfeited;
the date the Board determines any of the vesting
conditions will not be satisfied;
the date the Company is wound up; or
the date, other than above, that the participant and the
Company agree to in writing.
The loan is interest-free and fee-free, and limited recourse.
Limited recourse means the repayment amount will be the
lesser of the outstanding loan value and the market value of
the loan funded shares that were acquired using the loan.
If the participant’s loan funded shares are of lower value
than the loan balance at the time that they are required to
repay the loan, that participant’s loan funded shares will be
disposed of at market value and the proceeds applied in full
satisfaction of the loan obligations.
The participant may repay the loan before the repayment
date. The loan must be repaid in full (or arrangements for the
repayment of the loan entered into to the satisfaction of the
Board), and the vesting conditions satisfied, before the loan
funded shares can be disposed of.
If dividends are paid by the Company on the participant’s
loan funded shares, the Company will apply the after-tax
value of the dividends to the repayment of the loan.
When the loan is due for repayment, the Company may sell
or buy-back some or all of the participant’s loan funded
shares to satisfy the outstanding loan balance. The proceeds
from any sale or buy-back of the loan funded shares will
be applied to repay the outstanding loan balance and any
excess funds after costs and expenses will be returned to
the participant if they are entitled to them under the terms of
the plan rules and the loan.
To date, loan funded shares offered under the Loan Funded
Share Plan vest in three equal tranches on each of the first,
second and third anniversaries of the grant date, provided
the participant has not ceased employment, engagement or
directorship with the Company before the relevant vesting date.
DUBBER ANNUAL REPORT 2020DUBBER.NET
PERFO RMAN CE R IGHTS
power to:
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The Directors, at their discretion, may at any time invite
eligible employees to participate in the Performance Rights
Plan. The eligible participants under the plan are full time and
part time employees (including Directors) of the Company
and its related bodies corporate or any other person who
is declared by the Board to be eligible to receive a grant
of performance rights under the plan (eligible employees).
Subject to Board approval, an eligible employee may
nominate a nominee to receive the performance rights to be
granted to the eligible employee.
The plan is administered by the Directors, who have the
i. determine appropriate procedures for administration of
the plan consistent with its terms;
resolve conclusively all questions of fact or interpretation
in connection with the plan;
iii. delegate the exercise of any of its powers or discretions
arising under the plan to any one or more persons for
such period and on such conditions as the Board may
determine; and
iv. suspend, amend or terminate the plan (subject
to restrictions on amendments to the plan which
reduce the rights of the participant in respect of any
performance rights or shares already granted).
Performance rights will be granted for nil cash consideration,
unless the Board determines otherwise (which will be no
more than a nominal amount). No amount will be payable on
the exercise of performance rights under the plan.
The plan does not set out a maximum number of shares that
may be made issuable to any one person or company.
The shares to be issued following the performance rights
vesting conditions being satisfied, will be issued on the same
terms as the fully paid, ordinary shares of the Company
and will rank equally with all of the Company’s then existing
shares. The Board may apply such further voluntary escrow
33
on shares issued on conversion of performance rights as it
shall determine appropriate.
The performance rights granted under the plan will be
subject to vesting conditions determined by the Board
from time to time and expressed in a written offer made
by the Company to the eligible employee which is subject
to acceptance by the eligible employee within a specified
period. The vesting conditions may include one or more
of (i) service to the Company of a minimum period of time
(ii) achievement of specific performance conditions by
the participant and/or by the Company or (iii) such other
performance conditions as the Board may determine and
set out in the offer. The Board determines whether vesting
conditions have been met.
Performance rights will have an expiry date as the Board may
determine in its absolute discretion and specify in the offer
to the eligible employee.
The vesting conditions of performance rights will have a
milestone date as determined by the Board in its absolute
discretion and will be specified in the offer to the eligible
employee. The Board shall have discretion to extend a
milestone date.
Performance rights will not be listed for quotation. However,
the Company will make application to ASX for official
quotation of all shares issued on vesting of the performance
rights within the period required by the Listing Rules.
The Performance rights are not transferable unless the Board
determines otherwise or the transfer is required by law and
provided that the transfer complies with the Corporations Act.
If a vesting condition of a performance right is not achieved
by the earlier of the milestone date or the expiry date then
the performance right will lapse. An unvested performance
right will also lapse if the participant ceases to be an
eligible employee for the purposes of the plan by reason of
resignation, termination for poor performance or termination
for cause (unless the Board determines otherwise).
DUBBER ANNUAL REPORT 2020DUBBER.NET
Under the plan, if the participant ceases to be an employee
performance rights is equal to 10% of the entire fully diluted
of the Company or of a related body corporate for any reason
share capital of the Company.
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other than those reasons set out in the paragraph above,
including (but not limited to) upon the retirement, total and
permanent disability, redundancy, death of a participant
or termination by agreement then in respect of those
performance rights which have not satisfied the vesting
condition but have not lapsed, then the participant shall be
permitted to continue to hold those performance rights as if
the participant was still an eligible employee except that any
continuous service condition will be deemed to have been
waived (unless the Board determines otherwise).
If, in the opinion of the Board, a participant acts fraudulently
or dishonestly, is in breach of his or her obligations to the
Company and its related bodies corporate or has done an
act which has brought the Company or any of its related
bodies corporate into disrepute, or the Company becomes
aware of a material misstatement or omission in the
financial statements in relation to the Company Group, a
participant is convicted of an offence in connection with the
affairs of the Company Group or a participant has judgment
entered against him in any civil proceedings in respect of
the contravention of his duties at law in his capacity as an
employee or officer of the Company Group, the Board will
have the discretion to deem any performance rights to have
If in the opinion of the Board, performance rights vested
as a result of the fraud, dishonesty or breach of obligations
of either the participant or any other person and in the
opinion of the Board, the performance rights would not have
otherwise vested; or the Company is required by, or entitled
under, law to reclaim an overpaid bonus or other amount
from a participant, then the Board may determine (subject to
applicable law) any treatment in relation to the performance
rights or shares to comply with the law or to ensure no unfair
benefit is obtained by the participant.
If there is a change of control event in relation to the Company
prior to the conversion of the performance rights, then all
remaining milestones will be deemed to have been achieved
and each performance right will automatically and immediately
convert into shares, however, if the number of shares to be
issued as a result of the conversion of all performance rights
due to a change in control event in relation to the Company is
in excess of 10% of the total fully diluted share capital of the
Change of control event means:
i. the occurrence of:
a)
the offeror under a takeover offer in respect of all
shares announcing that it has achieved acceptances in
respect of 50.1% or more of the Shares; and
b)
that takeover bid has become unconditional; or
ii. the announcement by the Company that:
a)
shareholders have at a Court convened meeting of
shareholders voted in favour, by the necessary majority,
of a proposed scheme of arrangement under which all
shares are to be either (1) cancelled, or (2) transferred
to a third party; and
b)
the Court, by order, approves the proposed scheme of
arrangement.
The Board may waive, amend or replace any vesting
condition attaching to a performance right if the Board
determines that the original vesting condition is no longer
appropriate or applicable, provided that the interests of the
relevant participant are not, in the opinion of the Board,
materially prejudiced or advantaged relative to the position
reasonably anticipated at the time of the grant.
There are no participating rights or entitlements inherent in
the performance rights and participants will not be entitled
to participate in new issues of capital offered to shareholders
during the currency of the performance rights.
If the Company makes an issue of shares pro rata to existing
shareholders there will be no adjustment to the number
of shares which must be allocated on the exercise of a
performance right.
If the Company makes a bonus issue of shares or other
securities to existing shareholders (other than an issue in
lieu or in satisfaction of dividends or by way of dividend
reinvestment) the number of shares which must be allocated
on the exercise of a performance right will be increased
by the number of shares which the participant would have
received if the performance right had vested before the
record date for the bonus issue.
Company at the time of the conversion, then the number of
To date, performance rights offered under the Performance
performance rights to be converted will be prorated so that
Rights Plan have milestones with an expiry date set as the
the aggregate number of shares issued upon conversion of all
vesting conditions.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
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:
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ST EV E MC GOVERN
Agreement type:
Agreement commenced:
Term of Agreement:
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Remuneration:
Termination notice:
PET ER CLAR E
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
PET ER PAWLOWITSC H
Agreement type:
Agreement commenced:
Term of Agreement:
MANAGI NG DIRECTOR
Executive Service Agreement (MD Agreement)
2-Mar-15
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-E XECUTIVE CHAIRMAN
Letter of appointment
1-Dec-17
No fixed term
Annual fee of $109,500 and reimbursement of all reasonable expenses incurred in
performing the Non-Executive Chairman’s duties.
None specified
NON-E XECUTIVE DIRECTOR
Letter of appointment
1-Dec-14
No fixed term
Remuneration:
Annual fee of $100,000 plus statutory superannuation, plus reimbursement of all reasonable
expenses incurred in performing the Non-Executive Director’s duties.
Termination notice:
In the event Mr Pawlowitsch 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).
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GERAR D BON GIORNO
NON-E XECUTIVE DIRECTOR
Agreement type:
Letter of appointment
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
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JAMES S LAN EY
Agreement commenced:
Agreement type:
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Term of Agreement:
Remuneration:
Termination notice:
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CHR IS JAC KS ON
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
PET ER CU RIGL IA NO
Agreement type:
Agreement commenced:
Term of Agreement:
Remuneration:
Termination notice:
RU SSELL EVAN S
2-Jul-17
No fixed term
Annual fee of $75,000 (inclusive of statutory superannuation) plus reimbursement of all
reasonable expenses incurred in performing the Non-Executive Director’s duties.
None specified
C O-FOUNDE R AND GENE RAL MANAGE R
Executive Service Agreement (GM Agreement)
2-Mar-15
Same terms as termination notice below
Annual salary of $260,000 plus statutory superannuation.
The Company may terminate the agreement on 3 months’ notice, or by providing a cash
payment in lieu of such notice.
C HIE F TECHNOLOGY OFFICE R
Employment Agreement (CTO Agreement)
2 March 2015
No fixed term
Annual salary of $200,000 plus statutory superannuation.
Standard 5 week notice periods for termination apply to the CTO Agreement in accordance
with statutory requirements.
C HIE F FINANCIAL OFFICER
Executive Service Agreement (CFO Agreement)
18-Jun-18
No fixed term
Annual salary of $220,000 plus statutory superannuation.
The Company may terminate the agreement on 3 months’ notice, or by providing a cash
payment in lieu of such notice.
GLOBA L SALES DIRECTOR
Agreement type:
Service Agreement
Agreement commenced:
Term of Agreement:
Remuneration:
6-May-19
No fixed term
Annual salary of $320,000 plus statutory superannuation.
Termination notice:
The Company may terminate the agreement on 3 months’ notice, or by providing a cash
payment in lieu of such notice.
36
DUBBER ANNUAL REPORT 2020DUBBER.NET
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o
e
s
u
P Pawlowitsch
G Bongiorno
P Clare
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o
s
r
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p
J Slaney
R Evans
Total
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C Jackson
P Curigliano
Details of Remuneration for Year
Details of the remuneration of each director and named executive officer of the Company, including their personally-related enti-
ties, during the year was as follows:
Short Term Benefits
Year
Salary
and Fees
Cash
Bonus
Long
Term
Benefits
Annual
& Long
Service
Leave
$
$
$
$
Post-Employment
Share
Based
Payments
Superannuation
Options,
Total
Remuneration
Remuneration
consisting of
based on
options, rights
performance
or shares
Rights or
Shares
$
-
$
436,356
Executive Directors:
S McGovern
2020
240,000
150,000
23,556
22,800
2019
240,000
150,000
14,708
22,800
25,640
453,148
Non-Executive Directors:
%
0
6
31
49
-
-
26
39
%
34
39
-
-
-
-
-
-
4
7
-
-
-
-
6
7
11
Other Key Management Personnel:
2020
109,500
2019
107,125
2020
100,000
2019
100,000
2020
75,000
2019
75,000
-
-
-
-
-
-
-
-
-
-
-
-
-
2,375
9,500
9,500
-
-
a) 49,068
158,568
107,014
216,514
-
-
109,500
109,500
a) 26,367
101,367
59,581
134,581
2020
321,896
40,000
25,633
24,700
b) 600,000
1,012,229
59
2019
263,427
10,000
11,314
8,233
12,280
305,794
2020
208,587
2019
207,395
2020
215,905
2019
224,833
-
-
-
-
3,808
19,816
c) 292,300
524,512
1,857
19,702
17,738
246,693
12,924
24,995
c) 134,670
388,494
15,648
24,766
38,010
303,257
4
56
7
35
13
2020
320,000
35,000
8,647
31,825
c) 263,130*
658,602
40
2020
1,590,888
225,000
74,569
133,636
1,365,535
3,389,628
40
2019
1,217,780
160,000
43,527
87,376
260,803
1,769,486
15
a)
b)
c)
Subject to vesting dates under the Loan Funded Share Plan as detailed in the section titled ‘Compensation Securities Issued to Key Management Personnel’.
Fully Paid Ordinary shares issued upon successful achievement of the business objectives of the Company’s long term strategy.
At the time of issue to Mr J Slaney, these shares were valued at $1.60 per share.
Options and shares issued under the Company’s employee share and option plans.
* included in this is 100,000 fully paid ordinary shares valued at $87,000, to be issued after 30 June 2020.
Note: Mr R Evans commenced as Key Management Personnel from 1 July 2019.
37
DUBBER ANNUAL REPORT 2020DUBBER.NET
Compensation Securities Issued
to Key Management Personnel
PERFO RMAN CE R IGHTS
LOAN F U N DED SHAR ES
No performance rights were issued for the year ended 30 June 2020 (2019:
$38,460).
In FY2018 the following loan funded shares were issued as part of the
remuneration package of Directors appointed during the year.
Key Management
Grant Date
Number
Granted
Value per Loan
Vesting Date
Number
Funded Share at
Grant Date
Vested during
the year
Number
Vested in
Prior Years
Balance at
30/06/20
Unvested
29/11/17
175,000
29/11/17
175,000
29/11/17
175,000
$0.27
$0.27
$0.27
20/12/18
-
175,000
20/12/19
175,000
20/12/20
-
-
-
-
200,000
-
-
-
-
175,000
-
-
200,000
375,000
01/12/17
200,000
$0.42
30/01/19
01/12/17
200,000
$0.42
30/01/20
200,000
01/12/17
200,000
$0.42
30/01/21
-
1,125,000
375,000
375,000
The issue of the loan funded shares to Mr Gerard Bongiorno was approved by
shareholders at the 2017 annual general meeting held on 29 November 2017. The
total value of the loan funded shares was $141,750. The fair value was determined
using a Black-Scholes model with an underlying share price of $0.360, volatility
of 100% and an interest rate of 2.09%. The value of the loan funded shares has
been allocated over the vesting period of each tranche. At 30 June 2020, $26,367
(approximately 19% of the total value of the loan funded shares), assessed as
vested is included in the remuneration table above.
The issue of the loan funded shares to Mr Peter Clare was approved by
shareholders at general meeting held on 30 January 2018. The total value of the
loan funded shares was $250,560. The fair value was determined using a Black-
Scholes model with an underlying share price of $0.555, volatility of 100% and an
interest rate of 2.47%. The value of the loan funded shares has been allocated
over the vesting period of each tranche. At 30 June 2020, $49,068 (approximately
20% of the total value of the loan funded shares), assessed as vested is included
in the remuneration table above.
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Personnel
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G Bongiorno
Tranche 1
Tranche 2
Tranche 3
P Clare
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Total
Tranche 1
Tranche 2
Tranche 3
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DUBBER ANNUAL REPORT 2020DUBBER.NET
During the year the Board implemented an independent review of its remuneration
policies to come into effect from 1 July 2020. As at the date of this report, the new
policies and framework were finalised and hence will be applied retrospectively
from 1 July 2020, and furthermore were disclosed to shareholders in a Notice of
Meeting released to the share market on 23 October 2020 for the approval of the
equity component of the related parties.
At the 2019 AGM, 98% of the votes received supported the adoption of the
remuneration report for the year ended 30 June 2019. The Company did not
receive any specific feedback at the AGM regarding its remuneration practices.
Telephony services totalling $2,150 (2019: $2,442) were provided by Canard Pty Ltd,
a company associated with Mr Steve McGovern. Trade payables at 30 June 2020
include a balance of $193 (30 June 2019: $832) payable to Canard Pty Ltd.
Intelligent Voice and 1300 MY SOLUTION are businesses associated with Mr Steve
McGovern. The Group earned service fee income of $57,943 (2019: $56,850) from
Intelligent Voice and $168,269 (2019: $242,620) from 1300 MY SOLUTION.
During the financial year, advisory services of $42,750 (2019: $13,500) were provided
by Mr Peter Pawlowitsch’s consultancy company, Gyoen Pty Ltd for services
outside his usual Board duties. Trade payables at 30 June 2020 include a balance
of $4,125 (30 June 2019: $13,500) payable to Gyoen Pty Ltd.
Other receivables at 30 June 2020 includes an amount of $140,977 (30 June 2019:
$140,977) receivable from the Medulla Group Pty Ltd vendors, including Mr Steve
McGovern and Mr James Slaney.
All transactions are conducted on normal commercial terms and on an arm’s
length basis.
REM UN ERATIO N
CON S ULTA NTS
VOTING AND C OMMENTS
MADE AT TH E COMPANY’S
2019 AN NUAL GENERA L
MEETI NG (‘AGM” )
OT HER TRA NSACTIONS
WITH K EY MAN AGEMENT
PERS O NN EL
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39
DUBBER ANNUAL REPORT 2020DUBBER.NET
Additional Disclosures Relating to Key Management Personnel
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:
Balance at
Received as
Options
Acquired/
Net
Balance
start of Year
Remuneration
Exercised
disposed
Change
at End of
Other
Year
7,747,328
765,000
3,409,348
792,111
3,249,831
50,000
40,500
7,000
-
-
-
-
*375,000
*145,000
-
-
-
-
-
-
-
70,000
150,000
-
-
-
-
-
-
-
-
9,500
16,061,118
520,000
220,000
9,500
-
-
-
-
-
-
-
-
-
7,747,328
765,000
3,409,348
792,111
3,624,831
265,000
190,500
16,500
16,810,618
SHA REH O LD IN GS
Key Management Personnel
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n
o
P Clare
S McGovern
P Pawlowitsch
G Bongiorno
P Curigliano
J Slaney
C Jackson
e
s
u
Total
R Evans
S McGovern
P Clare
P Pawlowitsch
G Bongiorno
J Slaney
C Jackson
P Curigliano
R Evans
a
n
o
s
r
e
p
Total
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Grant date
Number of options
Vesting date
OPTION HOLD INGS
Key Management Personnel
*Shares were granted on 23 September 2019 at a market value of $1.60 per share.
Note: subject to shareholder approval, Mr Stephen McGovern and Mr Peter Pawlowitsch will receive 833,333 fully paid ordinary shares each after they
l
agreed to participate in a capital raise in April 2020
The number of options over ordinary shares in the Company held during the financial
year by each director and other members of key management personnel of the
Consolidated Entity, including their personally related parties, is set out below:
Balance at Start
Received as
Options
of Year
Remuneration
Exercised
Options
Expired
Net Change
Balance at
Other
end of Year
-
-
-
-
-
70,000
150,000
-
220,000
-
-
-
-
-
75,000
167,500
150,000
392,500
-
-
-
-
-
(70,000)
(150,000)
-
(220,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
75,000
167,500
150,000
392,500
The assessed fair values of the options was determined using a binomial option pricing model or Black-Scholes model, taking
into account the exercise price, term of option, the share price at grant date and expected price volatility of the underling
share, expected yield and the risk-free interest rate for the term of the option. For the options granted during the current
financial year, the inputs to the model used were:
23 September 2019
31 March 2020
150,000
15/11/2019
242,500
29/5/2020
Expense recognised in FY20 ($)
$176,130 (2019: $ -)
$194,970 (2019: $ -)
Exercise Price
Value Per Option
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of options (years)
$0.75
$1.1742
-
100%
0.78%
3
$ -
$0.8040
-
100%
0.38%
3
40
This is the end of the audited remuneration report.
DUBBER ANNUAL REPORT 2020DUBBER.NET
INDE MNIF YING
OFFICERS O R
AUDI TOR S
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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 willful breach of duty in
relation to Dubber Corporation Limited.
SH AR E O P TIO N S AND O RDINA RY S HARE S
At the date of this report there were
the following unissued ordinary
shares for which options were
outstanding:
→ 2,000,000 options expiring 31
December 2020, exercisable at
$0.80 each;
→ 777,290 options expiring 15 January
2022, exercisable at $0.38 each;
→ 140,000 options expiring 20
September 2022, exercisable at
$1.25 each;
→ 150,000 options expiring 20
September 2022, exercisable at
$0.75 each;
→ 1,485,000 options expiring 22 March
2023, exercisable at $0.75 each.
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41
During the year the following
options were granted:
During the year the following
options were exercised:
→ 140,000 options expiring 20
September 2022, exercisable at
$1.25 each;
→ 150,000 options expiring 20
September 2022, exercisable at
$0.75 each;
→ 1,555,000 options expiring 22 March
2023, exercisable at $0.75 each;
and
→ 360,000 zero exercise price options
expiring 22 March 2023.
→ 534,210 options expiring 15 January
2022, exercised at $0.38 each;
→ 750,000 options expiring 31 March
2020, exercised at $0.40 each
→ 2,000,000 options expiring 31
December 2019, exercised at $0.60
each;
→ 70,000 options expiring 22 March
2023, exercised at $0.75 each.
During the year 1,995,000 fully paid ordinary shares were issued under an
employee share plan.
During the year 100,000 options exercisable at $0.40 each expired on 31
March 2020.
Since the end of the financial year, 13,500 options have been exercised at
$0.38 each and 360,000 zero exercise price options have been exercised.
No other options have been issued, exercised or expired.
DUBBER ANNUAL REPORT 2020DUBBER.NET
PROCEED IN GS ON
BEHAL F O F TH E
COMPA NY
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ENVIRONMEN TA L
REGU LATI ON S
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NON-AUD IT
S ERVIC ES
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AUDITO R’S
INDEP END ENCE
DEC LAR ATIO N
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.
The Group is not currently subject to any specific environmental regulation under
Australian Commonwealth or State law.
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 17 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 17 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.
The auditor’s independence declaration for the year ended 30 June 2020, 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 Clare
Non-Executive Chairman
Dated: 30 October 2020
42
DUBBER ANNUAL REPORT 2020DUBBER.NET
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 DEAN JUST TO THE DIRECTORS OF DUBBER CORPORATION
LIMITED
As lead auditor of Dubber Corporation Limited for the year ended 30 June 2020, 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.
Dean Just
Director
BDO Audit (WA) Pty Ltd
Perth, 30 October 2020
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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 firms. Liability by a scheme approved under Professional Standards Legislation.
CON S OLI DATED STATEMENT O F P ROFI T OR LOS S AND
OT HER C OMP REHENSIV E INC O ME
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Revenue
Service income
Other revenue from ordinary activities
Expenses
e
s
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Direct costs
Salaries and related expenses
Employee share based payments
General and administration costs
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Finance costs
Depreciation and amortisation
Non-operating foreign exchange gains losses
Loss before income tax expense
Income tax expense
Loss after income tax expense for the year
Other comprehensive loss
Items that may be reclassified to profit or loss
Foreign currency translation differences
Other comprehensive loss for the year, net of tax
Total comprehensive loss attributable to owners of
Dubber Corporation Limited
Loss per share attributable to the owners of
Dubber Corporation Limited
Basic loss per share
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Note
2 (a)
2 (b)
22
2 (c)
2020
$
9,649,834
2,194,392
2019
$
5,547,540
1,844,650
(13,217,848)
(7,754,804)
(4,412,032)
(620,299)
(6,598,407)
(4,262,002)
(3,307,808)
(2,688,417)
(148,836)
(2,051,129)
(108,426)
(19,081)
(1,571,271)
(124,988)
(18,000,260)
(9,648,672)
3
-
-
(18,000,260)
(9,648,672)
(26,428)
(26,428)
(28,159)
(28,159)
(18,026,688)
(9,676,831)
15
Cents
(9.30)
Cents
(6.22)
The above consolidated statement of profit or loss and other comprehensive
income should be read in conjunction with the accompanying notes.
43
DUBBER ANNUAL REPORT 2020DUBBER.NET
CON SO LIDATED STATEMENT O F F INANCIAL POSI TI ON
l
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ASSETS
e
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Current Assets
Cash and cash equivalents
Trade and other receivables
Sundry debtors
Total Current Assets
Non-Current Assets
Property, plant and equipment
Rights of use asset
Intangible assets
l
Total Non-Current Assets
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o
s
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p
Total Assets
LIABILITIES
Current Liabilities
Trade and other payables
Deferred consideration
Lease liability
Provisions
Contract liabilities
Total Current Liabilities
Non-Current Liabilities
Lease liability
Provisions
Total Non-Current Liabilities
Contract liabilities
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EQUITY
Total Liabilities
NET ASSETS
Issued capital
Reserves
Accumulated losses
TOTAL EQUITY
The above consolidated statement of financial position should be
read in conjunction with the accompanying notes.
44
Note
2020
$
2019
$
4
5
6
8
7
9
24
8
10
8
10
11
12
13
14
18,408,881
19,618,245
10,346,912
6,768,088
106,067
-
28,861,860
26,386,333
241,582
2,102,360
4,137,010
6,480,952
108,914
-
4,320,395
4,429,309
35,342,812
30,815,642
5,323,337
2,144,758
116,381
560,630
763,974
632,623
-
-
485,701
-
7,396,945
2,630,460
1,915,789
-
300,910
182,789
2,399,488
9,796,433
160,250
-
160,250
2,790,710
25,546,379
28,024,932
85,666,948
71,592,844
8,803,497
7,355,894
(68,924,066)
(50,923,806)
25,546,379
28,024,932
DUBBER ANNUAL REPORT 2020DUBBER.NET
CON S OLI DATED STATEMENT O F C HANGES IN EQUITY
Issued Capital
Reserves
Accumulated Losses
Total
$
$
$
$
71,592,843
7,355,895
(50,923,806)
28,024,932
-
-
-
-
(26,428)
(18,000,260)
(18,000,260)
-
(26,428)
(26,428)
(18,000,260)
(18,026,688)
11,606,592
(470,487)
2,938,000
-
-
1,474,030
-
-
-
11,606,592
(470,487)
4,412,030
85,666,948
8,803,497
(68,924,066)
25,546,379
44,871,437
7,303,755
(41,275,134)
10,900,058
-
-
-
-
(28,159)
(9,648,672)
(9,648,672)
-
(28,159)
(28,159)
(9,648,672)
(9,676,831)
Balance at 1 July 2019
Loss after income tax expense for the year
Other comprehensive loss for the year, net of
Total comprehensive loss for the year
Transactions with owners in their capacity as owners:
Securities issued during the year
Capital raising costs
Cost of share based payments
Balance at 30 June 2020
l
Balance at 1 July 2018
Loss after income tax expense for the year
Other comprehensive loss for the year, net of
Total comprehensive loss for the year
Transactions with owners in their capacity as owners:
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2020
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tax
2019
a
n
o
s
r
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p
Conversion of Performance Rights
Securities issued during the year
Capital raising costs
Cost of share based payments
Balance at 30 June 2019
540,000
27,553,570
(1,372,164)
-
(540,000)
-
-
620,299
-
-
-
-
-
27,553,570
(1,372,164)
620,299
71,592,843
7,355,895
(50,923,806)
28,024,932
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
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45
DUBBER ANNUAL REPORT 2020DUBBER.NET
CON S OLI DATED STATEMENT O F C ASH FLOWS
Cash flows from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Government grants received
Interest and other finance costs paid
Net cash outflows used in operating activities
Cash flows from investing activities
Payments for business acquisition
Purchase of plant and equipment
Return/(payment) of security bond and funds held in trust
Net cash provided by / (used in) investing activities
Cash flows from financing activities
Proceeds from issue of shares
Payment of share issue costs
Principle elements of lease liability
Net cash provided by financing activities
Net increase / (decrease) in cash held
Cash and cash equivalents at the beginning of the year
Effect of exchange rate changes on cash
Cash and cash equivalents at the end of the year
The above consolidated statement of cash flows should
be read in conjunction with the accompanying notes.
Note
2020
$
2019
$
5,575,307
3,333,418
(20,377,768)
(14,684,357)
70,115
2,052,459
(4,758)
27,554
1,775,095
(8,139)
21
(12,684,645)
(9,556,429)
67,316
(127,166)
1,519,606
1,459,756
10,757,495
(488,510)
(189,071)
10,079,914
(1,144,976)
19,618,245
(64,388)
18,408,881
-
(61,490)
(2,480,109)
(2,541,599)
27,553,570
(1,509,379)
-
26,044,191
13,946,163
5,673,548
(1,466)
19,618,245
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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.
ADOPT IO N OF NEW A ND REVI SE D ACCOUNTIN G STANDARDS
The consolidated entity has adopted all of the new or amended Accounting
Standards and Interpretations issued by the Australian Accounting Standards
Board (‘AASB’) that are mandatory for the current reporting period.
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AASB 16 Leases
The consolidated entity has adopted AASB 16 from 1 July 2019. The standard
replaces AASB 117 ‘Leases’ and for lessees eliminates the classifications of
operating leases and finance leases. Except for short-term leases and leases
of low-value assets, right-of-use assets and corresponding lease liabilities are
recognised in the statement of financial position. Straight-line operating lease
expense recognition is replaced with a depreciation charge for the right-of-use
assets (included in operating costs) and an interest expense on the recognised
lease liabilities (included in finance costs). In the earlier periods of the lease, the
expenses associated with the lease under AASB 16 will be higher when compared
to lease expenses under AASB 117.
Impact of adoption
The consolidated entity has adopted AASB 16 from 1 July 2019 using the
retrospective modified approach and as such the comparatives have not been
restated.
Cash flow presentation relating to leases is shown as follows:
• cash payments for the principal portion of the lease liabilities
as cash flows from financing activities
• cash payments for the interest portion consistent with presentation of interest
payments, and
• short-term lease payments, payments for leases of low-value assets and
variable lease payments that are not included in the measurement of the lease
liabilities as cash flows from operating activities.
Operating cash flows will increase as the element of cash paid attributable to the
repayment of principal is included in financing cash flows rather than operating
cash flow.
Adjustments recognised on adoption of AASB 16
On adoption of AASB 16, the group recognised lease liabilities in relation to leases
which had previously been classified as Operating leases under the principles
of AASB117 Leases. These liabilities were measured at the present value of the
remaining lease payments, discounted using the lessee’s incremental borrowing
rate as of 1 July 2019. The weighted average incremental borrowing rate applied to
the lease liabilities on 1 July 2019 was 6%.
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Opening position – reconciliation to previous reporting disclosure
The following table reconciles the operating lease commitments previously
disclosed applying AASB 117 in the Annual Report of 30 June 2019, discounted
using the incremental borrowing rate at 1 July 2019 and the lease liabilities
recognised at the date of the initial application under AASB 16.
Reconciliation to previous reporting disclosure
1 July 2019
$
Operating lease commitments as disclosed at 30 June 2019 annual report
2,257,025
Discounted using Dubber’s incremental borrowing rate as at 1 July 2019
1,920,591
Less: adjustments relating to rate affecting variable payments
Lease liability recognised as at 1 July 2019
Of which are:
Current lease liabilities
Non-Current lease liabilities
Total
(211,136)
1,709,4 55
211,136
1,498,319
1,709,455
Right of use assets (value determined solely with reference to the lease liability value)
1,709,455
Practical expedients applied
In applying AASB 16 for the first time, the group has used the following practical
expedients permitted by the standard:
•
the use of a single discount rate to a portfolio of leases with reasonably similar
characteristics
• accounting for operating leases with a remaining lease term of less than 12 months
as at 1 July 2019 as short-term leases
•
•
the exclusion of initial direct costs for the measurement of the right-of-use asset
at the date of initial application, and
the use of hindsight in determining the lease term where the contract contains
options to extend or terminate the lease.
Right-of-use assets
A right-of-use asset is recognised at the commencement date of a lease. The
right-of-use asset is measured at cost, which comprises the initial amount of the
lease liability, adjusted for, as applicable, any lease payments made at or before
the commencement date net of any lease incentives received, any initial direct
costs incurred, and, except where included in the cost of inventories, an estimate
of costs expected to be incurred for dismantling and removing the underlying
asset, and restoring the site or asset.
Right-of-use assets are depreciated on a straight-line basis over the unexpired
period of the lease or the estimated useful life of the asset, whichever is the
shorter. Where the consolidated entity expects to obtain ownership of the
leased asset at the end of the lease term, the depreciation is over its estimated
useful life. Right-of use assets are subject to impairment or adjusted for any
remeasurement of lease liabilities.
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Lease liabilities
A lease liability is recognised at the commencement date of a lease. The lease
liability is initially recognised at the present value of the lease payments to be
made over the term of the lease, discounted using the interest rate implicit in
the lease or, if that rate cannot be readily determined, the consolidated entity’s
incremental borrowing rate. Lease payments comprise of fixed payments less
any lease incentives receivable, variable lease payments that depend on an index
or a rate, amounts expected to be paid under residual value guarantees, exercise
price of a purchase option when the exercise of the option is reasonably certain to
occur, and any anticipated termination penalties. The variable lease payments that
do not depend on an index or a rate are expensed in the period in which they are
incurred.
Lease liabilities are measured at amortised cost using the effective interest
method. The carrying amounts are remeasured if there is a change in the
following: future lease payments arising from a change in an index or a rate used;
residual guarantee; lease term; certainty of a purchase option and termination
penalties. When a lease liability is remeasured, an adjustment is made to the
corresponding right-of use asset, or to profit or loss if the carrying amount of the
right-of-use asset is fully written down.
B. REVENUE RECOGNITION
Revenue is measured based on the consideration specified in a contract with a
customer and excludes amounts collected on behalf of third parties. The Group
recognises revenue when it transfers control over a service to a customer.
Group revenues consists of service income, being monthly subscription fees from
retail or reseller customers.
S UB S CRIPTION S ERVICE INCOME
Subscription service revenue is recognised and measured in the accounting
period in which the services are provided based on the amount of the expected
transaction price allocated to each performance obligation.
The performance obligations are the provision of cloud-based call recording
services (Dubber Platform) on a monthly basis; the provision of services represent
a series of distinct services that are substantially the same with the same pattern
of transfer to customer. The performance obligation is considered to be satisfied
as control over the services are transferred to the customer, being the point at
which the services are accessible to the customer. It is at this point which revenue
is recognised.
INTER EST
Interest revenue is recognised using the effective interest rate method, which, for
floating rate financial assets, is the rate inherent in the instrument.
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C. GOVERNMENT GRANTS/RESEARCH AND DEVELOPMENT TAX INCENTIVES
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Grants from the government (such as research and development tax incentives) are
recognised at their fair value where there is reasonable assurance that the grant will
be received and the Group will comply with all attached conditions. Government
grants received for the period prior to the acquisition of Dubber Pty Ltd was deducted
from the carrying value of the Dubber intellectual property, with subsequent grants
being recognised as other income. The Company qualified for Jobkeeper and Cash
Flow Boost that are Federal and State Government initiatives to support businesses
through the COVID-19 pandemic. Amounts under these initiatives were received by
the Company and are expected to continue into FY21.
D. BASIS OF CONSOLIDATION
S UB S IDIARIES
The consolidated financial statements incorporate the assets and liabilities of all
subsidiaries of Dubber Corporation Limited (“Company” or “parent entity”) as at
30 June 2020 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.
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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.
F. FOREIGN CURRENCY TRANSLATION
→ Functional and presentation currency
The consolidated financial statements are presented in Australian dollars,
which is the functional and presentation currency of Dubber Corporation
Limited.
→ Transactions and balances
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.
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.
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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.
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 setoff
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 setoff 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.
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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. 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.
K. TRADE RECEIVABLES
L. FINANCIAL INSTRUMENTS
Trade receivables are initially recognised at fair value and subsequently measured at
amortised cost using the effective interest method, less any allowance for expected
credit losses. Trade receivables are generally due for settlement within 30 days.
The consolidated entity has applied the simplified approach to measuring expected
credit losses, which uses a lifetime expected loss allowance. To measure the expected
credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected
credit losses.
Recognition and derecognition
Financial assets and financial liabilities are recognised when the Group becomes a party
to the contractual provisions of the financial instrument.
Financial assets are derecognised when the contractual rights to the cash flows from
the financial asset expire, or when the financial asset and substantially all the risk and
rewards are transferred. A financial liability is derecognised when it is extinguished,
discharged, cancelled or expires.
Classification and initial measurement of financial assets
Financial assets are classified according to their business model and the characteristics
of their contractual cash flows and are initially measured at fair value adjusting for
transaction costs (where applicable).
Subsequent measurement of financial assets
For the purpose of subsequent measurement, financial assets, other than those
designated and effective as hedging instruments, are classified into the following four
categories:
→ Financial assets at amortised cost
→ Financial assets at fair value through profit or loss (FVTPL)
→ Debt instruments at fair value through other comprehensive income (FVTOCI)
→ Equity instruments at FVTOCI
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Financial assets at amortised cost
Financial assets with contractual cash flows representing solely payments of principal
and interest and held within a business model of ‘hold to collect’ contractual cash flows
are accounted for at amortised cost using the effective interest method. The Group’s
trade and other receivables fall into this category of financial instruments.
Impairment
The Group makes use of a simplified approach in accounting for trade and other
receivables and records the loss allowance at the amount equal to the expected lifetime
credit losses. In using this practical expedient, the Group uses its historical experience,
external indicators and forward looking information to calculate the expected credit
losses using a provision matrix.
The Group considers a financial asset in default when contractual payment are 90 days
are due. However, in certain cases, the Group may also consider a financial asset to be
in default when internal or external information indicates that the Group is unlikely to
receive the outstanding contractual amounts in full before taking into account any credit
enhancements held by the Group.
M. 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
Useful Life
Furniture, Fixtures and Fittings
Computer Equipment
Computer Software
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
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N. IMPAIRMENT OF ASSETS
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.
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 preacquisition 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.
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 pretax 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.
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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.
O. 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.
P. 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.
Q. 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.
R. EARNINGS PER SHARE
→ Basic earnings per share
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.
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S. 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”).
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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.
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T. INTANGIBLE ASSETS
Intangible assets acquired as part of a business combination are brought in at fair value
at acquisition. Intangible assets with finite useful life are amortised over a straight-line
basis in the profit or loss over the estimated useful life. Management had previously
re-assessed the useful life of the platform from 10 years to 5 years, as they believe it is
more reflective of the useful life.
U. GOODWILL
V. EMPLOYEE PROVISIONS
Goodwill is measured as described in note 1(x). Goodwill on acquisition of subsidiaries is
included in intangible assets. Goodwill is not amortised but it is tested for impairment
annually, or more frequently if events or changes in circumstances indicate that it might
be impaired, and is carried at cost less accumulated impairment losses. Gains and
losses on the disposal of an entity include the carrying amount of goodwill relating to
the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing.
The allocation is made to those cash-generating units or groups of cash-generating
units that are expected to benefit from the business combination in which the goodwill
arose. The units or groups of units are identified at the lowest level at which goodwill is
monitored for internal management purposes, being the operating segments (Note 19).
→ Short-term employee benefit obligations
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
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. 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
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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.
W. 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.
Carrying value of goodwill
The Group tests annually whether the carrying value of goodwill and other intangibles
exceed its recoverable amount to determine potential impairment requirements. The
recoverable amount of goodwill and other intangibles has been calculated using a number
of assumptions as disclosed in note 7. No impairment has been recognised in respect of
intangibles at the end of the reporting period.
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 BlackScholes method. The related assumptions are
detailed in Note 21. 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.
Coronavirus (COVID-19) pandemic
Judgement has been exercised in considering the impacts that the Coronavirus (COVID-19)
pandemic has had, or may have, on the company based on known information. This
consideration extends to the nature of the services offered, customers, supply chain,
staffing and geographic regions in which the company operates. Other than as addressed in
specific notes, there does not currently appear to be either any significant impact upon the
financial statements or any significant uncertainties with respect to events or conditions
which may impact the company unfavourably as at the reporting date or subsequently as a
result of the Coronavirus (COVID-19) pandemic.
Allowance for expected credit losses
The allowance for expected credit losses assessment requires a degree of estimation and
judgement. It is based on the lifetime expected credit loss, grouped based on days overdue,
and makes assumptions to allocate an overall expected credit loss rate for each group.
These assumptions include recent sales experience and historical collection rates.
Incremental borrowing rate
Where the interest rate implicit in a lease cannot be readily determined, an incremental
borrowing rate is estimated to discount future lease payments to measure the present
value of the lease liability at the lease commencement date. Such a rate is based on what
the entity estimates it would have to pay a third party to borrow the funds necessary to
obtain an asset of a similar value to the right-of-use asset, with similar terms, security and
economic environment.
The following key judgements have been applied in relation to revenue recognition:
Revenue from contracts with customer
The Group applied the following judgements that significantly affect the determination of
the amount and timing of revenue from contracts with customers:
In certain revenue contracts, the Group provides development & integration services and
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s
u
l
a
n
o
s
r
e
p
r
o
F
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DUBBER ANNUAL REPORT 2020DUBBER.NET
l
y
n
o
e
s
u
right to use of software licences which are bundled together. Where these services are
bundled, they are recognised as one performance obligation, as the licence is not distinct
from the development/integration service.
The customer receives the right to use the Software licence based on number of users
determined at the inception of the contract and hence any fixed consideration relating to
the contract is recognised at the a point in time when the Software licence is installed and
integrated on to the customers platform and ready for use. Ongoing monthly fees which
represents variable consideration ( as contract has no expiry date and can be cancelled at
any point in time), are recognised overtime when it is deemed to be virtually certain it would
not reverse which is when the company has the right to invoice and client acceptance.
Fair value of net assets assumed in a business combination
Estimates and judgements were made in determining the fair value of assets acquired and
liabilities assumed in a business combination. Assets and liabilities which judgement were
made in determining fair value were:
Assets: Trade and other Receivables, Other assets, Property plant and equipment
Liabilities: Unearned revenue and provisions
For the year ended 30 June 2020, the Group has elected to provisionally account for
the acquisition of CallN Pty Ltd in accordance with the provisions of AASB 3 Business
Combinations.
l
X. BUSINESS COMBINATIONS
a
n
o
s
r
e
p
r
o
F
The acquisition method of accounting is used to account for business combinations
regardless of whether equity instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets
transferred, equity instruments issued or liabilities incurred by the acquirer to former
owners of the acquiree and the amount of any non-controlling interest in the acquiree. All
acquisition costs are expensed as incurred to profit or loss.
On the acquisition of a business, the consolidated entity assesses the financial assets
acquired and liabilities assumed for appropriate classification and designation in accordance
with the contractual terms, economic conditions, the consolidated entity’s operating or
accounting policies and other pertinent conditions in existence at the acquisition-date.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed
and any non-controlling interest in the acquiree and the fair value of the consideration
transferred and the fair value of any pre-existing investment in the acquiree is recognised as
goodwill. If the consideration transferred and the pre-existing fair value is less than the fair
value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the
difference is recognised as a gain directly in profit or loss by the acquirer on the acquisition-
date, but only after a reassessment of the identification and measurement of the net assets
acquired, the non-controlling interest in the acquiree, if any, the consideration transferred
and the acquirer’s previously held equity interest in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer
retrospectively adjusts the provisional amounts recognised and also recognises additional
assets or liabilities during the measurement period, based on new information obtained
about the facts and circumstances that existed at the acquisition-date. The measurement
period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when
the acquirer receives all the information possible to determine fair value.
Y. PARENT ENTITY FINANCIAL INFORMATION
The financial information for the parent entity, Dubber Corporation Limited, disclosed in
Note 23 has been prepared on the same basis as the consolidated financial statements.
60
DUBBER ANNUAL REPORT 2020DUBBER.NET
2. Revenue and Expenses from Continuing Operations
Consolidated
2020
$
9,624,752
25,082
9,649,834
70,115
1,632,459
150,000
270,000
71,818
2,194,392
44,792
195,813
396,630
129,910
710,539
318,208
120,890
1,391,026
3,307,808
2019
$
5,478,230
69,310
5,547,540
27,554
1,708,038
67,058
-
42,000
1,844,650
47,282
136,676
139,938
148,758
822,593
310,690
71,267
1,011,213
2,688,417
(a) Service revenue
Subscriptions
Professional services
(b) Other revenue
Research and development tax incentive
Export market development grant
Jobkeeper grant
Rental income – sub lease
(c) General and administration costs
Accounting and tax advice fees
Audit fees
Legal fees
Securities exchange and registry fees
Travel costs
Corporate affairs
Insurances
Other administration
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o
Total
e
s
u
Interest
l
Total
a
n
o
s
r
e
p
Total
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o
F
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Consolidated
2020
$
2019
$
(18,000,260)
(9,648,672)
(4,950,072)
(2,653,385)
1,575,334
3,458,654
83,916
(83,916)
-
48,624
2,701,162
96,401
(96,401)
-
1,100,730
9,558,540
334,902
7,754,321
10,659,271
8,089,223
(882,814)
9,776,456
187,617
526,750
(693,093)
7,396,130
217,846
526,750
10,490,824
8,140,727
(882,814)
882,814
-
(693,093)
693,093
-
3. Income Tax
(a) Income tax expense
Loss before income tax expense
Tax at the Australian tax rate of 27.5% (2019: 27.5%)
Tax effect of amounts not deductible (taxable) in calculating taxable income
Deferred tax asset not brought to account on temporary differences & tax losses
Amounts recognised in equity
Income tax expense
(b) Deferred tax assets
Timing differences
Tax losses - revenue
Offset against Deferred Tax Liabilities
Deferred Tax Assets not brought to account
Amounts in equity
Tax losses - capital
(c) Deferred tax liabilities
Timing differences
Offset by Deferred Tax Assets recognised
There are no franking credits available to the Group.
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n
o
e
s
u
l
a
n
o
s
r
e
p
Total
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o
F
62
Deferred tax assets not brought to account, the benefits of which will only be realised if the
conditions set out in note 1(h) occur.
DUBBER ANNUAL REPORT 2020DUBBER.NET
l
y
n
o
Total
e
s
u
l
a
n
o
s
r
e
p
Total
r
o
F
4. Cash and Cash Equivalents
Cash at bank
Cash on call deposit
Consolidated
2020
$
8,408,881
10,000,000
18,408,881
2019
$
16,918,245
2,700,000
19,618,245
The cash on call deposit can be called back at any time by the company. The Company’s exposure to interest rate risk is
outlined in Note 16.
5. Trade and Other Receivables
Current
Trade receivables
Less: Provision for doubtful debt
Receivable from Medulla Group Pty Ltd vendors
Other debtors
Prepayments
Deposits in trust
Other receivables
Consolidated
2020
$
8,560,372
(187,279)
8,373,093
140,977
79,064
65,667
1,687,511
600
10,346,912
2019
$
3,211,353
-
3,211,353
140,977
-
208,677
3,206,481
600
6,768,088
Prepayments includes cash amounts deposited in a trust account. These amounts are set
aside to aid negotiation with the Groups suppliers. The cash can be called back at any time
by the Company.
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 $140,977. Receipt of this amount is
expected within 12 months of 30 June 2020.
Trade and other receivables are all due within three months of this report. Information
about credit and liquidity risk is outlined in Note 16.
63
DUBBER ANNUAL REPORT 2020DUBBER.NET
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:
Consolidated
2020
$
415,875
(174,293)
241,582
2019
$
208,535
(99,621)
108,914
Computer Equipment
Furniture
$
$
88,523
158,720
(59,579)
187,664
61,240
47,543
(20,260)
88,523
20,391
48,619
(15,092)
53,918
20,257
10,038
(9,904)
20,391
Total
$
108,914
207,339
(74,671)
241,582
81,497
57,581
(30,164)
108,914
6. Property, Plant and Equipment
Plant and equipment – at cost
Less: Accumulated depreciation
Net carrying amount
RECO NCI LIATION
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
Balance at the beginning of the year
Additions
Depreciation expense
Carrying amount at the end of the year
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u
2020
l
2019
a
n
o
s
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e
p
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o
F
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Consolidated
2020
$
8,483,031
(7,712,477)
770,554
2,008,734
1,357,722
4,137,010
4,320,395
1,357,722
(1,541,107)
4,137,010
2019
$
8,483,031
(6,171,370)
2,311,661
2,008,734
-
4,320,395
2,008,734
-
(1,541,107)
4,320,395
The goodwill and other intangibles is attributable to Dubber’s strong position to continue to roll out its software platform and
the expected cash flows to arise from the Company’s acquisition of Dubber Pty Ltd.
Goodwill acquired through the business combination has been allocated to the Company’s only cash generating unit (‘CGU’)
for impairment testing. The Board has determined the recoverable amount of the CGU by assessing the fair value less cost
of disposal (FVLCOD) of the underlying assets. The method applied was the market approach based on the current market
capitalisation (number of shares on issue multiplied by the quoted market price per share) of the Group on the Australian
Securities Exchange (ASX). The recoverable value is therefore a Level 1 measurement based on observable inputs of publicly
traded shares in an active market. The Board has not identified any reasonable possible changes in key assumptions that
could cause the carrying amount of the CGU to exceed its recoverable amount. Any reasonable change to the volatility of the
Company’s share price would not create an impairment.
7. Intangible Assets
Dubber intellectual property – at cost
Less: Accumulated amortisation
Sub Total
Opening goodwill
Acquired goodwill (Note 24)
Net carrying amount
Reconciliation
Balance at the beginning of the year
Acquired goodwill (Note 24)
Amortisation expense
Net carrying amount at the end of the year
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o
e
s
u
l
a
n
o
s
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e
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F
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DUBBER ANNUAL REPORT 2020DUBBER.NET
8. Leases
(i) Amounts recognised in the balance sheet
The balance sheet shows the following amounts relating to leases:
Right of use assets
Office space
Depreciation
Non-current
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n
o
Total
e
s
u
Total
Current
l
a
n
o
s
r
e
p
Lease liabilities
Additions to the right of use assets during the 2020 financial year were $2,545,890 (2019: $0).
(ii) Amounts recognised in the statement of profit or loss
Lease liabilities
Depreciation charge of right of use assets
Interest expense
The total cash outflow for leases in 2020 was $308,138.97 (2019: $0).
9. Trade and Other Payables
Current
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o
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Total
Trade payables
Other payables
Payroll tax and other statutory liabilities
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.
66
2020
$
2,545,890
(443,530)
2,102,360
2020
$
560,630
1,915,789
2,476,419
2020
$
443,530
119,599
Consolidated
2020
$
2,476,386
2,712,199
134,752
5,323,337
2019
$
-
-
-
2019
$
-
-
-
2019
$
-
-
2019
$
1,271,404
581,291
292,063
2,144,758
DUBBER ANNUAL REPORT 2020DUBBER.NET
10. Provisions
Employee benefits
Non-Current
Employee benefits
Current
l
y
n
o
Total
Consolidated
2020
$
2019
$
763,974
485,701
300,910
1,064,884
160,251
645,952
Employee benefits represent annual leave and long service leave entitlements of employees within the Group and is non-in-
terest bearing. The entire obligation is presented as current, since the Group does not have a right to defer settlement.
Contract Liabilities
Current
l
Non-current
Total contract liabilities
e
11.
s
u
a
n
o
s
r
e
p
Total
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F
12.
Reconciliation
Reconciliation of the written down values at the beginning and end
of the current and previous financial year are set out below:
Opening balance
Payments received in advance
Transfers to revenue – performance obligations satisfied
Consolidated
2020
$
632,623
182,789
815,412
Consolidated
2020
$
-
992,956
(177,544)
815,412
2019
$
-
-
-
2019
$
-
-
-
-
Unsatisfied performance obligations
The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied at the end of the
reporting period was $815,412 as at 30 June 2020 ($nil as at 30 June 2019). These are expected to be recognised as revenue in
future periods ranging from 6 – 44 months with the majority of the recognition coming in the next 24 months.
Issued Capital
Issued and paid up capital
207,722,566 (2019: 186,570,452) Ordinary shares – fully paid
Share issue costs written off against share capital
Total
67
Consolidated
2020
$
90,899,074
(5,232,126)
85,666,948
2019
$
76,348,837
(4,755,994)
71,592,843
DUBBER ANNUAL REPORT 2020DUBBER.NET
MOVEMEN T IN ORDINA RY SHA RE S ON ISSUE
2020
Issue Price
No. of Shares
$
Balance at the beginning of the year
Exercise of options – 23 July 2019
Exercise of options – 15 August 2019
Shares issued under employee share plan – 23 September 2019
Shares issued under employee share plan – 23 September 2019
Shares issued under employee share plan – 23 September 2019
Issued for cash pursuant to placement – 6 April 2020
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o
e
s
u
l
a
n
o
s
r
e
p
2019
r
o
F
Exercise of options – 30 September 2019
Exercise of options – 30 September 2019
Exercise of options – 30 September 2019
Exercise of options – 16 October 2019
Exercise of options – 6 December 2019
Exercise of options - 6 December 2019
Exercise of options – 11 December 2019
Exercise of options – 18 December 2019
Exercise of options – 19 March 2020
Exercise of options – 26 March 2020
Exercise of options – 27 March 2020
Exercise of options – 11 June 2020
Exercise of options -16 June 2020
Exercise of options – 23 June 2020
Issued on acquisition (Note 24)
Share issue costs
Balance at the end of the year
Balance at the beginning of the year
Exercise of options – 25 October 2018
Exercise of options – 8 January 2019
Exercise of options – 8 February 2019
Exercise of options – 1 March 2019
Exercise of options – 8 March 2019
Exercise of options – 14 March 2019
Exercise of employee shares – 14 March 2019
Exercise of options – 21 March 2019
Exercise of options – 5 April 2019
Performance Rights allocated – 28 March 2019
Issued for cash pursuant to placement – 9 April 2019
Issued for cash pursuant to placement – 24 April 2019
Share issue costs
Balance at the end of the year
68
Issued for cash pursuant to placement – 28 November 2018
-
$0.38
$0.38
$1.46
$1.60
$0.46
$0.38
$0.40
$0.60
$0.40
$0.38
$0.60
$0.38
$0.38
$0.38
$0.40
$0.40
$0.75
$0.38
$0.38
$0.60
$1.69
-
-
$0.25
$0.38
$0.25
$0.25
$0.25
$0.25
$0.25
-
$0.25
$0.38
-
$0.75
$0.38
-
186,570,452
71,592,843
55,000
125,000
1,000,000
895,000
100,000
25,000
75,000
600,000
150,000
70,000
1,400,000
150,000
25,000
14,210
225,000
300,000
70,000
50,000
20,000
20,900
47,500
1,460,000
1,432,000
46,000
9,500
30,000
360,000
60,000
26,600
840,000
57,000
9,500
5,400
90,000
120,000
52,500
19,000
7,600
15,003,333
9,001,995
799,571
-
854,741
(476,131)
207,722,566
85,666,948
140,079,435
120,000
11,841,895
205,000
325,000
325,000
375,000
600,000
300,000
225,000
25,000
1,500,000
29,333,333
1,315,789
-
44,871,437
30,000
4,500,320
51,250
81,250
81,250
93,750
150,000
-
56,250
9,500
540,000
22,000,000
500,000
(1,372,164)
186,570,452
71,592,843
DUBBER ANNUAL REPORT 2020DUBBER.NET
OPTIONS
At the end of the year, the following options over unissued ordinary shares were outstanding:
Expiry Date
Exercise Price
Number Under
31-Dec-20
15-Jan-22
20-Sep-22
20-Sep-22
22-Mar-23
22-Mar-23
$0.80
$0.38
$1.25
$0.75
$0.75
$0.00
Option
2,000,000
790,790
140,000
150,000
1,485,000
360,000
4,925,790
Grant Date
20-Dec-17
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n
o
15-Jan-19
23-Sep-19
23-Sep-19
31-Mar-20
31-Mar-20
Total
e
s
u
CA PITA L RIS K MANAGEMENT
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.
l
Consolidated
2020
$
5,792,426
3,004,038
135,000
(127,967)
8,803,497
2019
$
4,318,394
3,004,038
135,000
(101,538)
7,355,894
Reserves
Option reserve
Performance rights reserve
Unvested share reserve
Foreign currency reserve
a
13.
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o
s
r
e
p
Total
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DUBBER ANNUAL REPORT 2020DUBBER.NET
OPTION R ES ERVE
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 and loan funded shares.
Movement in option reserve:
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n
o
directors
e
s
u
l
a
n
o
s
r
e
p
r
o
F
Balance at the beginning of the year
Allocation of incentive based share options values over vesting period – employees
1,398,597
Allocation of incentive based loan funded shares values over vesting period –
75,435
Balance at the end of the year
5,792,426
4,318,394
PERFORMAN CE RIGHTS R ESE RVE
The performance rights reserve is used to record the value of performance rights issued as share based payments until the
performance rights are converted into fully paid ordinary shares upon achievement of performance based milestones.
Movement in performance rights reserve:
Allocation of incentive share based payment over vesting period – directors and key
Balance at the beginning of the year
management
Conversion of Performance Rights shares
Reversal of incentive share based payment – management performance shares
cancelled upon milestones not being achieved by expiry date
Consolidated
2020
$
2019
$
3,004,038
3,151,754
Balance at the end of the year
UNVE STED SH A RE R ESERVE
Movement in unvested share reserve:
The unvested share reserve is used to record the value of shares formally offered and accepted as
share based payments until the shares are issued on a future specified vesting date.
Consolidated
2020
$
4,318,394
-
-
-
3,004,038
Consolidated
2020
$
135,000
-
-
135,000
2019
$
4,130,797
285,811
(98,214)
591,281
(540,000)
(198,997)
3,004,038
2019
$
94,582
40,418
-
135,000
Balance at the beginning of the year
Allocation of incentive share based payment over vesting period – employee shares
Shares issued on vesting date
Balance at the end of the year
70
DUBBER ANNUAL REPORT 2020DUBBER.NET
FOREI G N CU RRENCY R ESERV E
The foreign currency reserve is used to record exchange differences arising from the translation of the financial statements of
foreign operations.
l
y
n
o
e
s
14.
u
l
a
n
o
s
15.
r
e
p
r
o
F
Movement in foreign currency reserve:
Balance at the beginning of the year
Currency translation differences
Balance at the end of the year
Accumulated Losses
Balance at the beginning of the year
Loss attributable to owners of Dubber Corporation Limited
Balance at the end of the year
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:
Consolidated
2020
$
(101,538)
(26,428)
(127,966)
Consolidated
2020
$
(50,923,806)
(18,000,260)
(68,924,066)
2019
$
(73,378)
(28,160)
(101,538)
2019
$
(41,275,134)
(9,648,672)
(50,923,806)
Consolidated
2020
$
2019
$
(18,000,260)
(9,648,672)
No.
No.
Earnings attributable to the owners of Dubber
Corporation Limited used to calculate EPS
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
193,598,343
155,231,963
calculating basic EPS
As the Company is in a loss position there is no diluted EPS calculated
71
DUBBER ANNUAL REPORT 2020DUBBER.NET
16. Financial Risk Management
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 9 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
Lease liability
Total Financial Liabilities
Financial Liabilities
l
Trade and other payables
-
-
2019
Note
2020
$
2019
$
Weighted Average Interest Rate
(%)
2020
1.2
-
0.71
-
4
5
9
8
18,408,881
19,618,245
10,387,312
6,559,412
28,796,193
26,177,657
5,323,337
2,144,758
2,476,419
-
7,799,756
2,144,758
The carrying amounts of these financial instruments approximate their fair values.
l
y
n
o
e
s
u
a
n
o
s
r
e
p
r
o
F
72
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FINANCI AL RI SK MA NAGEME NT P OLICIE S
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 technological 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 research 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 Managing Director, 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.
l
SPECIF IC F IN ANC IAL RIS K E X PO S URES AND MANAGE MENT
a) Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to
the consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information,
confirming references and setting appropriate credit limits. The consolidated entity obtains guarantees where appropriate to
mitigate credit risk. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying
amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to
the financial statements.
Credit-impaired financial assets
A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash
flows of that financial asset have occurred. Evidence that a financial asset is credit-impaired include:
→ significant financial difficulty of the customer;
→ a breach of contract;
→ it is probable that the customer will enter bankruptcy or other financial reorganisation.
The Group writes off a financial asset when there is information indicating that the counterparty is in severe financial
difficulty and there is no realistic prospect of recovery. However, financial assets may still be subject to enforcement
activities, taking into account legal advice where appropriate. Any recoveries made are recognised in the profit and loss.
Write-off policy
Trade receivables
The Group has adopted the simplified approach to measuring expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected credit losses, trade receivables have been grouped based on
shared credit risk characteristics and the days past due.
The expected loss rates are based on the payment profiles of contracts and corresponding historical credit losses. The
historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the
ability of the customers to settle the receivables.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
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F
On that basis, the loss allowance as at 30 June 2020 was determined as follows for both trade receivables.
Expected loss rate
Loss allowance
Gross carrying amount – trade receivables
Current
More than 30 days
More than 60 days
Total
past due
past due
0%
1,717,828
0
0%
66,103
0
2.7%
6,776,442
187,279
-
8,560,372
187,279
Management have assessed the risk of collections for the amounts more than 60 days past due as low, however have made a
conservative loss allowance in the year ended 30 June 2020 as shown in the above table.
The Company believes that The Group’s credit risk on liquid funds is limited because the majority of cash and deposits are
held with Westpac Banking Corporation and National Australia Bank, both AA3 credit rated banks.
b) 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 undrawn financing facilities. Trade and other payables,
the only financial liability of the Company, are due within 3 months.
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.
FINANCI AL LIAB IL ITY AND FIN A NC I AL ASSE T MATURITY ANALYSI S
Within 1 Year
1 to 5 Years
Total Contractual Cash
2020
2019
2020
2019
Flow
2020
$
2019
$
10,387,312
6,559,412
10,387,312
6,559,412
5,323,337
2,144,758
2,909,440
-
8,232,777
2,144,758
2,154,535
4,414,654
$
-
-
-
-
-
-
Financial assets – cash flows receivable
Trade and other receivables
Total expected inflows
Financial liabilities due for payment realisable
Trade and other payables
$
$
10,387,312
6,559,412
10,387,312
6,559,412
5,323,337
2,144,758
$
-
-
-
Lease liability
737,743
-
2,171,697
Total anticipated outflows
6,061,080
2,144,758
-
Net (outflow)/inflow on financial instruments
4,326,232
4,414,654
2,171,697
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DUBBER ANNUAL REPORT 2020DUBBER.NET
c) Market risk
Interest rate risk
The Company’s cashflow 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 0.5%
during the whole of the respective periods would have led to an increase/(decrease) in losses of less than $100,000.
Foreign currency risk
The consolidated Group undertakes certain transactions denominated in foreign currency and is exposed to foreign
currency risk through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial
liabilities denominated in a currency that is not the entity’s functional currency. The risk is measured using sensitivity
analysis and cash flow forecasting.
The carrying amount of the consolidated entity’s foreign currency denominated financial assets and financial liabilities at the
reporting date were as follows:
Assets
2020
$’000
908
608
1,516
2019
$’000
517
344
861
Liabilities
2020
$’000
2019
$’000
73
66
139
42
25
67
The consolidated entity had net assets denominated in foreign currencies of $1,377,000 (assets of $1,516,000 less liabilities of
$139,000) as at 30 June 2020 (2019: $794,000 (assets of $861,000 less liabilities of $67,000). Based on this exposure, had the
Australian dollar weakened by 10%/strengthened by 5% (2019: weakened by 5%/strengthened by 5%) against these foreign
currencies with all other variables held constant, the consolidated entity’s profit before tax for the year would have been
$137,000 lower/$68,000 higher (2019: $39,000 lower/$19,000 higher) and equity would have been $2.5m lower/$1.2m higher
(2019: $2.8m lower/$1.4m higher).
The percentage change is the expected overall volatility of the significant currencies, which is based on management’s
assessment of reasonable possible fluctuations taking into consideration movements over the last 6 months each year and
the spot rate at each reporting date. The actual foreign exchange loss for the year ended 30 June 2020 was $108,426 (2019:
loss of $124,988).
d) 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.
Consolidated
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US dollars
British pounds
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17. 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
Advisory services – BDO Reward (WA) Pty Ltd
Consolidated
2020
$
54,850
12,103
23,750
90,703
2019
$
47,282
14,235
-
61,517
18. Contingent Liabilities
The Consolidated entity has no material contingent liabilities as at reporting date (2019: Nil).
19. Operating Segments
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, being 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.
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Year ended 30 June 2020
Revenue
Result (Loss)
Total assets
Total liabilities
Acquisition of non-current assets
Depreciation of non-current assets
Depreciation of rights of use assets
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Revenue
Intangible assets
Amortisation
Year ended 30 June 2019
Result (Loss)
Total assets
Total liabilities
Acquisition of non-current assets
Depreciation of non-current assets
Intangible assets
Amortisation
76
Corporate
Technology
$
$
Total
$
1,807,076
(5,192,216)
18,808,452
(1,696,078)
-
-
(443,529)
-
-
1,794,087
(858,470)
16,399,326
(483,162)
-
-
-
-
10,037,150
11,844,226
(12,808,044)
(18,000,260)
16,534,360
(8,100,354)
127,166
(66,493)
-
6,239,370
(1,541,107)
5,598,103
(8,790,202)
14,416,316
(2,307,548)
61,490
(30,164)
4,320,395
(1,541,107)
35,342,812
(9,796,432)
127,166
(66,493)
(443,529)
6,239,370
(1,541,107)
7,392,190
(9,648,672)
30,815,642
(2,790,710)
61,490
(30,164)
4,320,395
(1,541,107)
DUBBER ANNUAL REPORT 2020DUBBER.NET
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Total
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20.
Related Party Transactions
SUBSI DIA RIES
The consolidated financial statements include the financial statements of Dubber Corporation Limited and the subsidiaries
listed in the following table:
Class of Shares
2020 (%)
2019(%)
Equity Holding
Country of
Incorporation
Australia
Australia
Ordinary
Ordinary
England and Wales
Ordinary
Australia
Ordinary
United States of
Ordinary
America
Australia
Australia
Ordinary
Ordinary
100
100
100
100
100
100
100
100
100
100
100
100
100
-
Medulla Group Pty Ltd
Dubber Pty Ltd
Dubber Ltd
Dubber USA Pty Ltd
Dubber, Inc.
Dubber Connect Australia Pty Ltd
CallN Pty Ltd
PA RE NT ENTITY
l
Dubber Corporation Limited is the ultimate Australian parent entity and ultimate parent of the Group.
KEY M ANAGEMENT PERS ONNE L
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 2020.
The totals of remuneration paid to key management personnel of the Company during the year are as follows:
Short-term employee benefits
Long-term benefits
Post-employment benefits
Share-based payments
Consolidated
2020
$
1,815,888
74,569
133,636
1,365,535
3,389,628
2019
$
1,377,780
43,527
87,376
260,803
1,769,486
OT HER TRA NSACTIONS W ITH KE Y MANAGE MENT PE RSONNEL
Telephony services totaling $2,150 (2019: $2,442) were provided by Canard Pty Ltd, a company associated with Mr Steve McGovern. Trade payables
at 30 June 2020 include a balance of $193 (30 June 2019: $832) payable to Canard Pty Ltd. Intelligent Voice and 1300 MY SOLUTION are businesses
associated with Mr Steve McGovern. The Group earned service fee income of $57,943 (2019: $56,850) from Intelligent Voice and $168,269 (2019:
$242,620) from 1300 MY SOLUTION. Trade receivables at 30 June 2020 include balances of nil (30 Jun 2019: nil) due from Intelligent Voice and nil
(30 June 2019: nil) due from 1300 MY SOLUTION. During the year $42,750 (2019: $13,500) was invoiced to the Company by Mr Peter Pawlowitsch’s
consultancy company, Gyoen Pty Ltd for advisory services outside his usual Board duties. Trade payables at 30 June 2020 include a balance of
$4,125 (30 June 2019: $13,500) payable to Gyoen Pty Ltd. Other receivables at 30 June 2020 includes an amount of $140,977 (30 June 2019: $140,977)
receivable from the Medulla Group Pty Ltd vendors, including Mr Steve McGovern and Mr James Slaney.
Amounts included in the remuneration table for Mr Gerard Bongiorno were paid to his consultancy company Otway Capital Consulting and likewise,
amounts included for Mr Peter Clare were paid to his consultancy company Shared Runway Pty Ltd. All transactions are conducted on normal
commercial terms and on an arm’s length basis. In the previous financial year, the Company issued 750,000 fully paid ordinary shares to a company
associated with Mr Steve McGovern, and 375,000 fully paid ordinary shares to Mr James Slaney following achievement of Milestone 1 in respect of
Performance Rights (refer Note 22). No Compensation Options were issued to related parties in the year ended 30 June 2020.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
Net cash outflows from operating activities
(12,684,645)
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NON-CASH F INA NCING AND INVE STING ACTIVI TI ES
(i) 799,571 fully paid ordinary shares were issued as the first installment for the acquisition of CallN Pty Ltd in June 2020 (2019: Nil).
(ii) The group recognised right of use assets of 2,545,890 as part of the adoption of AASB 16 leases in the year ended 30 June 2020
Share Based Payments
VA LU E O F S HA RE BASED PAYME N TS I N THE FINANCIAL STATEMENTS
21.
Cash Flow Information
Reconciliation of loss for the year to net cash flows from operating activities
Net loss for the year
Non-cash flows in loss:
Depreciation and amortisation
Share based payments
Net exchange differences
Changes in assets and liabilities:
Increase in trade and other receivables
Decrease/(Increase) in trade and other payables
Increase in provisions
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22.
s
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Expensed – directors and other key management personnel remuneration:
Performance rights
Employee options
Fully paid ordinary shares
Loan funded shares
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Sub-total
Expensed – other employees’ and consultants:
Fully paid ordinary shares
Employee options
Sub-total
Share based payments in capital raising costs:
Unlisted options
Total
78
Consolidated
2020
$
(18,000,260)
2,051,129
4,412,032
(108,426)
4,996,381
(5,497,489)
(538,012)
Consolidated
2020
$
-
176,130
832,000
75,435
1,083,565
2,106,000
1,222,467
3,328,467
-
4,412,032
2019
$
(9,648,672)
1,571,271
620,299
(124,988)
(2,651,995)
505,204
172,452
(9,556,429)
2019
$
51,281
-
166,595
217,876
217,876
60,333
342,090
402,423
-
620,299
DUBBER ANNUAL REPORT 2020DUBBER.NET
SHA R ES
2020
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y
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o
Total
2019
Offer Date
23/09/19
Offer Date
06/12/16
e
s
u
Total
Offer Date
23/09/19
l
2020
Total
a
n
o
s
r
e
p
2020
Grant Date
OPTION S
20/12/17
20/12/17
r
o
F
15/01/19
20/09/19
The Company formally offered the following shares to employees. The shares were granted and vested on 23 September 2019
at a market value of $1.60 per share.
Vesting Date
Balance 01/07/19
Offered
Ord FP Shares
Forfeited
Balance
23/09/19
-
-
895,000
895,000
Issued
895,000
895,000
30/06/20
-
-
-
-
Vesting Date
Balance 01/07/18
Offered
Ord FP Shares
Forfeited
Balance
01/03/19
300,000
300,000
-
-
Issued
(300,000)
(300,000)
30/06/19
-
-
-
-
The Company formally offered the following shares to consultants. The shares were granted and vested on 23 September
2019 at a market value of $1.60 per share.
Vesting Date
Balance 01/07/19
Offered
Ord FP Shares
Forfeited
Balance
23/09/19
-
-
1,100,000
1,100,000
Issued
1,100,000
1,100,000
30/06/20
-
-
-
-
Set out below are the summaries of options granted as share based payments:
Expiry
Date
Exercise
Defer
Balance
Granted
Exercised
Expired
Balance
Number
Price
Type
01/07/19
or
30/06/20
vested and
Forfeited
exercisable
22/12/16
31/03/20
$0.40
3
850,000
(750,000)
(100,000)
31/12/19
$0.60
31/12/20
$0.80
15/01/22
$0.38
20/09/22
$1.25
20/09/19
20/09/22
$0.75
31/03/20
22/03/23
$0.75
31/03/20
22/03/23
$0.00
-
-
-
-
2,000,000
2,000,000
1,325,000
-
-
-
-
(2,000,000)
-
(534,210)
140,000
150,000
-
-
1,555,000
(70,000)
360,000
-
-
-
-
-
-
-
-
-
-
-
-
2,000,000
2,000,000
790,790
790,790
140,000
140,000
150,000
150,000
1,485,000
1,485,000
360,000
360,000
Total
6,175,000
2,205,000
(3,354,210)
(100,000)
4,925,790
4,925,790
Weighted average exercise price
$0.59
$0.66
$0.51
$0.40
$0.67
$0.67
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DUBBER ANNUAL REPORT 2020DUBBER.NET
2019
Grant Date
30/06/15
31/03/16
16/11/16
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16/11/16
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n
o
20/12/17
20/12/17
22/12/16
15/01/19
Expiry
Date
31/03/19
31/03/19
27/01/19
27/01/20
31/03/20
31/12/19
31/12/20
15/01/22
Weighted average exercise price
Exercise
Defer
Balance
Granted
Exercised
Expired
Balance
Number
Price
Type
01/07/18
or
30/06/19
vested and
Forfeited
exercisable
1
2
3
$0.25
$0.72
$0.60
$0.80
$0.40
$0.60
$0.80
$0.38
2,175,000
100,000
2,000,000
2,000,000
850,000
2,000,000
2,000,000
-
-
-
-
-
-
-
(2,175,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
850,000
850,000
2,000,000
2,000,000
2,000,000
2,000,000
1,325,000
1,325,000
(100,000)
(2,000,000)
(2,000,000)
-
-
-
-
-
1,350,000
(25,000)
11,125,000
1,350,000
(2,200,000)
6,175,000
6,175,000
$0.59
$0.38
$0.25
$0.68
$0.64
$0.64
Total
e
s
u
l
a
n
o
s
r
e
p
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F
($)
The various deferred vesting options listed above are subject to milestones or vesting dates which are listed below. Probability
of achieving these milestones or vesting dates have been assessed at 100% unless otherwise stated.
1. Employee options vest and become exercisable on the following dates provided the employee is an employee of the
Company at the relevant vesting date:
Vesting date 1: 1 March 2016 - 750,000 options
Vesting date 2: 1 March 2017 - 750,000 options
Vesting date 3: 1 March 2018 - 750,000 options less 75,000 options cancelled during the FY2018 upon resignation of
employee before vesting date
2. Unlisted options issued to Aesir Capital Pty Ltd, vesting upon the completion of a subsequent capital raising in the amount
of $15,000,000 or more that is managed and facilitated by Aesir Capital Pty Ltd and completes within 15 months of the
share placement that was completed on 14 December 2016.These options did not vest and no value has been allocated
during the 2019 financial year for this share based payment.
3. Employee options vest and become exercisable on the following dates provided the employee is an employee of the
Company at the relevant vesting date:
Vesting date 1: 1 March 2017 - 350,000 options
Vesting date 2: 1 March 2018 - 350,000 options less 100,000 options cancelled during the FY2019 upon resignation of
employee before vesting date
Vesting date 3: 1 March 2019 - 350,000 options less 100,000 options cancelled during the FY2019 upon resignation of
employee before vesting date
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 and
previous financial year, the inputs to the model used were:
Grant date
15 January 2019
23 September 2019
23 September 2019
31 March 2020
31 March 2020
Number of options
Vesting date
Expense recognised in FY20
1,350,000
31/3/2019
$ -
140,000
15/11/2019
$145,264
(2019: $342,090)
(2019: $ -)
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
-
100%
1.78%
Expected life of options
3
(years)
-
100%
0.78%
3
80
150,000
15/11/2019
$176,130
(2019: $ -)
-
100%
0.78%
3
1,555,000
360,000
29/5/2020
29/5/2020
$787,764
(2019: $-)
$289,440
(2019: $ -)
-
100%
0.38%
3
-
100%
0.38%
3
DUBBER ANNUAL REPORT 2020DUBBER.NET
The weighted average remaining contractual life of share-based payment options that were outstanding as at 30 June 2020 was
1.6 years (2019: 1.12 years).
The weighted average fair value of share-based payment options granted during the year was $0.66 (2019: $0.2534) each.
PERFO RMAN CE R IGHTS
Each performance right converts into one fully paid ordinary share for nil cash consideration, upon the achievement of
performance based milestones.
No performance rights were issued in the year ended 30 June 2020.
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2019
1.
Type
e
s
u
Total
2.
Grant Date
Expiry Date
Balance 01/07/18
Granted
Converted
Forfeited
29/11/17
31/12/18
29/11/17
30/06/19
-
-
-
1,500,000
(1,500,000)
-
1,500,000
-
(1,500,000)
3,000,000
(1,500,000)
(1,500,000)
Balance
30/06/19
-
-
-
The weighted average remaining contractual life of performance shares outstanding at 30 June 2020 was nil years (2019: nil
l
years).
The various performance shares listed above were subject to milestones which are listed below.
1. Performance rights – Milestone 1
Milestone: the Group achieving SaaS Revenue of $500,000 or more for at least two consecutive calendar months, by 31
December 2018. This milestone was achieved and the fully paid ordinary shares were issued on 1 April 2019.
2. Performance rights – Milestone 2
Milestone: the Group achieving SaaS Revenue of $1,000,000 or more for at least two consecutive calendar months, by 30
June 2019. This milestone was not achieved and hence the Rights were cancelled on 30 June 2019.
LOAN F UND ED S HA R ES
Set out below is the summary of loan funded shares granted as share based payments:
Expiry
Date
Exercise
Defer
Balance
Granted
Exercised
Expired
Balance
Number
Price
Type
01/07/19
or
30/06/20
vested and
Forfeited
exercisable
20/12/22
$0.36
30/1/23
$0.56
1
2
525,000
600,000
1,125,000
-
-
-
-
-
-
-
-
-
525,000
350,000
600,000
400,000
1,125,000
750,000
Grant Date
Expiry
Date
Exercise
Price
Defer
Type
Balance
01/07/18
Granted
Exercised
Expired or
Balance
Number
Forfeited
30/06/19
vested and
exercisable
20/12/22
$0.36
30/1/23
$0.56
1
2
525,000
600,000
1,125,000
-
-
-
-
-
-
-
-
-
525,000
175,000
600,000
200,000
1,125,000
375,000
29/11/17
1/12/17
Total
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2020
Grant Date
29/11/17
1/12/17
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Total
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Equity
The deferred loan funded shares are subject to vesting dates which are listed below. Probability of achieving these vesting
dates have been assessed at 100% unless otherwise stated.
1. Loan funded shares vest on the following dates provided the employee is an employee of the Company at the relevant
vesting date:
Vesting date 1: 20 December 2018 - 175,000 loan funded shares
Vesting date 2: 20 December 2019 - 175,000 loan funded shares
Vesting date 3: 20 December 2020 - 175,000 loan funded shares
vesting date:
Vesting date 1: 30 January 2019 - 200,000 loan funded shares
Vesting date 2: 30 January 2020 - 200,000 loan funded shares
Vesting date 3: 30 January 2021 - 200,000 loan funded shares
2. Loan funded shares vest on the following dates provided the employee is an employee of the Company at the relevant
The assessed fair values of the loan funded shares was determined using a Black-Scholes model, taking into account the
exercise price, term of loan, the share price at grant date and expected price volatility of the underling share, expected yield
and the risk-free interest rate for the term of the loan. For the loan funded shares granted, the inputs to the model used were:
Grant date
Dividend yield (%)
Expected volatility (%)
Risk-free interest rate (%)
Expected life of loan (years)
Underlying share price ($)
Loan exercise price ($)
Value of loan funded share ($)
29/11/2017
-
100%
2.09%
5
$0.36
$0.36
$0.2700
1/12/2017
-
100%
2.47%
5
$0.555
$0.555
$0.4176
23. Parent Entity Disclosures
SUM MARY F I NA NC IA L INFOR MATIO N
The individual financial statements for the parent entity show the following aggregate amounts:
Statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
Issued capital
Reserves
Accumulated losses
Total equity
Loss for the year
Total comprehensive loss
2020
($)
2,459,317
26,206,631
28,665,948
1,144,894
1,974,675
3,119,569
25,546,379
84,227,772
8,905,097
(67,586,490)
25,546,379
(5,192,216)
(5,192,216)
2019
($)
16,399,326
12,108,768
28,508,094
483,162
-
483,162
28,024,932
70,462,765
7,997,432
(50,435,265)
28,024,932
(9,676,831)
(9,676,831)
The parent entity had no capital commitments or contingent liabilities at 30 June 2020 or 30 June 2019.
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24. Business Combinations
On 31 May 2020, Dubber Corporation Limited, acquired 100% of the ordinary shares of CallN Pty Ltd for the total consideration
of cash and FPO shares in Dubber corporation Limited to the value of $997,595. The acquired business contributed revenues
of $93,758 to the consolidated entity for the period from 1 June 2020 to 30 June 2020. The values identified in relation to the
acquisition of CallN Pty Ltd are provisionally accounted for as at 30 June 2020.
Fair value
$’000
215
48
34
79
(28)
(14)
(213)
(335)
(146)
(360)
1,357
997
30
854
113
997
107
Details of the acquisition are as follows:
Cash and cash equivalents
Trade and other receivables
Prepayments
Plant and equipment
Payroll liabilities
Statutory liabilities
Trade and other payables
Contract liabilities
Employee benefits
Net assets acquired
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Total
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Goodwill
Acquisition-date fair value of the total consideration transferred
Representing
Cash paid or payable to vendor
799,571 fully paid ordinary shares in Dubber Corporation Ltd issued or to be issued to vendor
105,549 fully paid ordinary shares in Dubber Corporation Ltd issued to be issued as deferred
consideration to the vendor
Acquisition costs expensed to profit or loss
25. Events Subsequent to Year End
The full impact of the COVID-19 outbreak, continues to evolve at the date of this report. The Group is therefore uncertain as to the full
impact that the pandemic will have on its financial condition, liquidity, and future results of operations during FY2021.
Management is actively monitoring the global situation and its impact on the Group’s financial condition, liquidity, operations,
suppliers, industry, and workforce. Given the daily evolution of the COVID-19 outbreak and the global response to curb its
spread, the Group is not able to estimate the effects of the COVID-19 outbreak on its results of operations, financial condition, or
liquidity for the 2021 financial year.
The Company successfully completed a placement of 31,818,181 fully paid ordinary shares at a price of $1.10 per share in October
2020. In addition to this placement, a Share Purchase Plan was also offered to existing shareholders capped at $6,000,000 at
$1.10 per FPO share. This is due to be completed in November 2020.
Following an external independent review the Company established a new executive remuneration framework to apply with
effect from 1 July 2020. The review also included recommendations on the design and operation of short term and long term
incentive plans for the Company’s executives. As a result of this review, new executive service agreements were entered into
with Managing Director, Mr Stephen McGovern. In addition the review resulted in a change of role for Mr Peter Pawlowitsch from
Non-Executive Directive to Executive Director - Commercial and Strategy, under a new executive service agreement. These new
agreements will be effective from 1 July 2020.
There are no further matters or circumstances that have arisen since 30 June 2020 that have or may significantly affect the
operations, results, or state of affairs of the Company in future financial years.
The financial report was authorised for issue on 30 October 2020 by the Board of Directors.
Further information is available in the Notice of Meeting and a separate announcement to the market both made on 27 October.
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Directors’
Declaration
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DIREC TO RS ’ D ECL ARATION
The directors of the Company declare that:
1. The financial statements and notes are in accordance with the Corporations Act 2001, and:
comply with Accounting Standards, the Corporations Regulations 2001 and other mandatory
professional reporting requirements; and
ii. give a true and fair view of the financial position of the Company as at 30 June 2020 and of its
performance for the financial year ended on that date.
2. The Managing Director and Chief Financial Officer have each declared that:
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
iii.
l
the financial statements and notes for the financial year give a true and fair view.
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.
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Peter Clare
Non-Executive Chairman
Dated: 30 October 2020
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Independent
Auditors Report
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DUBBER.NETDUBBER ANNUAL REPORT 2020
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
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INDEPENDENT AUDITOR'S REPORT
To the members of Dubber Corporation Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Dubber Corporation Limited (the Company) and its subsidiaries
(the Group), which comprises the consolidated statement of financial position as at 30 June 2020, 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, and notes
to the financial report, including a summary of significant accounting policies and the directors’
declaration.
In our opinion the accompanying financial report of the Group, is in accordance with the Corporations
Act 2001, including:
(i)
Giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its
financial performance for the year ended on that date; and
(ii)
Complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the Financial
Report section of our report. We are independent of the Group in accordance with the Corporations
Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s
APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code)
that are relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the
time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in
our audit of the financial report of the current period. These matters were addressed in the context of
our audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
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 firms. Liability by a scheme approved under Professional Standards Legislation.
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Revenue recognition
Key audit matter
How the matter was addressed in our audit
The Group recognises revenue in accordance with AASB
Our audit procedures included but were no limited to
15 Revenue from Contracts with Customers (AASB 15).
the following:
There are complexities and judgements associated with
(cid:127)
Obtaining and reviewing a sample of contracts,
interpreting key revenue contracts entered into by the
considering the terms and conditions,
Group against the requirements of the accounting
performance obligations of these arrangements
standard.
This area is a key audit matter due to:
(cid:127)
(cid:127)
the significance of revenue to the financial
report; and
revenue being one of the key drivers to the
Group’s performance.
and assessing the accounting treatment under
AASB 15 Revenue from Contract with
Customers;
(cid:127)
(cid:127)
Performing analytical procedures to understand
movements and trends in revenue for
comparisons against expectations;
Agreeing, for a sample of revenue transactions,
the amounts recorded by the Group to
supporting documentation to confirm the
existence and accuracy of the revenue
recognised and to consider whether the
transaction was recorded in the correct period;
and
(cid:127)
Assessing the adequacy of the relevant
disclosures in Note 1 (b), Note 1 (w) and Note 2
within the financial report.
Carrying Values of Trade Receivables
Key audit matter
How the matter was addressed in our audit
The Group’s trade receivables including provision for
Our procedures included, but were not limited to the
expected credit losses balances as at 30 June 2020 are
following:
disclosed in Note 5 to the financial report.
AASB 9 Financial Instruments (AASB 9) has been applied
by the Group and requires an impairment measurement
framework, referred to as Expected Credit Losses
(ECLs).
Due to the quantum of the assets and the judgement
involved in determining the provision for ECLs as
disclosed in Note 1 (w) to the financial report, we have
determined that the carrying value of the trade
receivables a key audit matter.
(cid:127)
(cid:127)
(cid:127)
Verifying, on a sample basis, the trade
receivable balances to the receipts in bank
statements subsequent to year-end;
Reviewing the ageing profile of the receivables,
taking into consideration the terms and
conditions of the contractual arrangements;
Assessing the methodologies and assumptions
use to estimate the expected credit loss in
accordance with AASB 9;
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(cid:127)
(cid:127)
(cid:127)
On a sample basis obtaining direct confirmation
from customers on the trade receivables
balances recorded at year-end;
Holding discussion with management to
understand the credit risk and financial outlook
of customers; and
Assessing the adequacy of the relevant
disclosures in Note 1 (k), Note 1 (w) and Note 5
within the financial report.
Other information
The directors are responsible for the other information. The other information comprises the
information in the Group’s annual report for the year ended 30 June 2020, but does not include the
financial report and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information
and, in doing so, consider whether the other information is materially inconsistent with the financial
report or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a
true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001
and for such internal control as the directors determine is necessary to enable the preparation of the
financial report that gives a true and fair view and is free from material misstatement, whether due to
fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the group to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or has no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with the Australian Auditing Standards will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the
Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:
https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf
This description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 26 to 40 of the directors’ report for the
year ended 30 June 2020.
In our opinion, the Remuneration Report of Dubber Corporation Limited, for the year ended 30 June
2020, complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility
is to express an opinion on the Remuneration Report, based on our audit conducted in accordance with
Australian Auditing Standards.
BDO Audit (WA) Pty Ltd
Dean Just
Director
Perth, 30 October 2020
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ADD IT IONA L S HA REHOL DER INFO R MATION
The following additional information is current as at 28 October 2020.
COR P O RATE GOVERNA NC E:
The company’s corporate governance statement is available on the company’s website at www.dubber.net/company-
SUBSTAN TIAL SHAREHOLDER :
Holding ranges
above 0 up to and including 1,000
above 1,000 up to and including 5,000
above 5,000 up to and including 10,000
above 10,000 up to and including 100,000
above 100,000
Holders
Total units
% issued share capital
1,147
1,613
677
1,326
297
583,492
4,597,495
5,574,811
43,222,431
186,041,618
0.24%
1.92%
2.32%
18.01%
77.51%
5,060
240,019,847
100.00%
There are 447 shareholders with less than a marketable parcel.
VOTING RIGH TS
Each fully paid ordinary share carries voting rights of one vote per share.
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DUBBER ANNUAL REPORT 2020DUBBER.NET
TOP 2 0 HOLD ER S OF OR DIN A RY S HARE S
4
NATIONAL NOMINEES LIMITED
HOLDER NAME
CS THIRD NOMINEES PTY LIMITED
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