ICANDY INTERACTIVE LIMITED
AND CONTROLLED ENTITIES
ABN: 87 604 871 712
Financial Report For The Year Ended
31 December 2020
For personal use only ICANDY INTERACTIVE LIMITED
AND CONTROLLED ENTITIES
ABN: 87 604 871 712
Financial Report For The Year Ended
31 December 2020
CONTENTS
Corporate Governance Statement
Directors' Report
Auditor's Independence Declaration
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors' Declaration
Independent Auditor's Report
Additional Information for Listed Public Companies
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For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CORPORATE GOVERNANCE STATEMENT
iCandy Interactive Limited is listed on the Australian Securities Exchange (ASX). Accordingly, unless stated otherwise in this
document, the Board's corporate governance arrangements comply with the recommendations of the ASX Corporate Governance
Council as well as current standards of best practice. The corporate governance statement is current as at the date of this report
and has been approved by the Board.
Our approach to corporate governance
(a)
Framework and approach to corporate governance and responsibility
The Board of iCandy Interactive Limited ("the Company") is committed to maintaining the highest standards of corporate
governance.
Corporate governance is about having a set of values that underpin the company's everyday activities - values that
ensure fair dealing, transparency of actions, and protect the interests of stakeholders. The Board considers corporate
governance forms part of a broader framework of corporate responsibility and regulatory oversight.
In pursuing the commitment to best practice governance standards, the Board will continue to:
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renew and improve its governance practices; and
monitor global developments in best practice corporate governance.
The Board's approach has been guided by the principles and practices that are in our stakeholders' best interests while
enduring full compliance with legal requirements.
(b)
Compliance with the ASX Corporate Governance Principles and Recommendations
The ASX Listing Rules require listed companies to include in their Annual Report a statement disclosing the extent to
which they have followed the ASX Corporate Governance Principles and Recommendations in the reporting period.
Listed companies must identify the recommendations that have not been followed and provide reasons for the company's
decision and this can be found on pages 7 to 13.
Date of this statement
This statement reflects our corporate governance policies and procedures as at 31 December 2020.
The Board of Directors
(a)
Membership and expertise of the Board
The Board has a broad range of relevant financial and other skills, experience and expertise to meet its objectives. The
current Board composition, with details of individual Director's backgrounds, is set out in the Directors Report which is
included in this Annual Report.
(b)
Board role and responsibility
The Board is accountable to shareholders for iCandy Interactive Limited's performance. In summary, the Board's
responsibilities include:
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providing strategic direction and approving corporate strategic initiatives;
planning for Board and executive succession;
selecting and evaluation future Directors, the Chief Executive Officer ("CEO");
approving budget and monitoring management and financial performance;
considering and approving the Annual Financial Report (including the Directors' Declaration) and the
interim financial statements;
approving iCandy Interactive Limited's risk management strategy, monitoring its effectiveness and
maintaining a director and ongoing dialogue with iCandy Interactive Limited's auditors and regulators; and
considering and reviewing the social and ethical impact of iCandy Interactive Limited's activities, setting
standards for social and ethical practices and monitoring compliance with iCandy Interactive Limited's
social responsibility policies and practices.
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CORPORATE GOVERNANCE STATEMENT
The Board would normally delegate to management responsibility for:
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developing and implementing corporate strategies and making recommendations on significant corporate
strategic initiatives;
maintaining an effective risk management framework and keeping the Board and market fully informed
about material risks;
developing iCandy Interactive Limited's annual budget, recommending it to the Board for approval and
managing day-to-day operations within budget; and
managing day-to-day operations in accordance with standards for social and ethical practices which have
been set up by the Board.
The current circumstances, however, require all these functions to be exercised by the Board members or the Company
Secretary. The company does not currently have a performance evaluation method due to the current size and limited
nature of its operations.
The Board has adopted a Board Charter which sets out the specific responsibilities of the Board, the requirements as to
the Board's composition, the roles and responsibilities of the Chairman, Company Secretary and management, the
establishment, operations and management of Board Committees, Directors' access to Company records and
information, details of the Board's relationship with management, details of the Board's performance review and details of
the Board's disclosure policy.
A copy of the Company's Board Charter is contained in the Company's Corporate Governance Plan which is available on
the Company's website.
(c)
Board size and composition
The Board determines its size and composition, subject to the limits imposed by iCandy Interactive Limited's Constitution.
The Constitution requires a minimum of three and a maximum of twenty Directors. In addition, at least two of the Directors
shall ordinarily reside within Australia. Currently, the Board consists of four directors. The Board supports the principles of
diversity; however, due to the size and scale of the company's operations, it has no female representative on the board at
the present time.
Election of the Board members is substantially the province of the Shareholders in general meetings.
(d)
The selection and role of the Chairman
The Chairman is selected by the Board from the executive and non-executive Directors. The Chairman's role includes:
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providing effective leadership on formulating the Board's strategy;
representing the views of the Board to the public;
ensuring that, when all Board members take office, they are fully briefed on the terms of their appointment,
their duties and responsibilities;
ensuring that the Board meets at regular intervals throughout the year, and that minutes of meetings
accurately record decisions taken and, where appropriate, the view of individual Directors;
guiding the agenda and conduct of all Board meetings; and
reviewing the performance of the Board of Directors.
The Board charters provides that where practical, the Chairman of the Board will be a non-executive director. The
Chairman, Kin Wai Lau is an executive director and is not considered by the Board to be independent.
(e)
Directors' Independence
The Board assesses each of the Directors against specific criteria to decide whether they are in a position to exercise
independent judgement. Directors are considered to be independent if they are independent of management and free
from any business or other relationship that could materially interfere with, or could reasonable be perceived to materially
interfere with, the exercise of their unfettered and independent judgement. Materiality is assessed on a case-by-case
basis by reference to each Directors' individual circumstances rather than general materiality thresholds. In assessing
independence, the Board considers whether the Director has a business or other relationship with iCandy Interactive
Limited, either directly, or as a partner, shareholder or officer of a company or other company that has an interest, or a
business or other relationship, with iCandy Interactive Limited or another iCandy Interactive Limited group member.
Presently, the Company's independent director is Marcus Ungar. The Company may seek to appoint additional
independent Directors in the future to address the lack of independence of its Directors.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
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CORPORATE GOVERNANCE STATEMENT
(f)
Avoidance of conflicts of interest by a Director
In accordance with the Corporations Act 2001, any Director with a material personal interest in a matter being considered
by the Board must not be present when the matter is being considered and may not vote on the matter.
(g)
Meetings of the Board and their conduct
Meetings of the Board happen when and as appropriate. Details of Board meetings held and attended are tabled in the
Directors' Report, which forms part of this Annual Report.
(h)
Succession planning
The Board plans succession of its own members taking into account the skills, experience and expertise required and
currently represented, and iCandy Interactive Limited's future direction. The Board is also responsible for CEO
succession planning.
(i)
Review of Board performance
The Board of iCandy Interactive Limited is responsible for evaluating the performance of the Board and individual
Directors will be evaluated on an annual basis, with the aid of an independent advisory, if deemed required. The process
for this can be found in Schedule 6 of the Company's Corporate Governance Plan.
The Company's Corporate Governance Plan requires the Board to disclose whether or not performance evaluations were
conducted during the relevant reporting period. Details of the performance evaluations conducted will be provided in the
Company's Annual Reports.
(j)
Nomination and appointment of new Directors
iCandy Interactive Limited has detailed guidelines for the appointment and selection of the Board. The Company's
Corporate Governance Plan requires the Board to undertake appropriate checks before appointing a person, or putting
forward to security holders a candidate for election, as a Director.
All material information relevant to a decision on whether or not to elect or re-elect a Director will be provided to security
holders in a Notice of Meeting pursuant to which the resolution to elect or re-elect such Director will be voted on.
(k)
Retirement and re-election of Directors
iCandy Interactive Limited's Constitution states that one-third of our Directors must retire each year. The maximum time
that each Director can serve in any single term is three years. Any Director who has been appointed during the year must
retire at the next annual general meeting. Eligible Directors who retire each year may offer themselves for re-election by
shareholders at the next annual general meeting.
(l)
Compulsory retirement of Directors
The Board has no limit on the number of terms of office which any Director may serve.
(m)
Board access to information and advice
All Directors have unrestricted access to company records and information and receive regular detailed financial and
operational report. The Company Secretary provides Directors with ongoing guidance on issues such as corporate
governance, iCandy Interactive Limited's Constitution and the law. The Board collectively, and each Director individually
has the right to seek independent professional advice at iCandy Interactive Limited's expense to help them carry out their
responsibilities. While the Chairman's prior approval is needed, it may not unreasonably withheld and, in the its absence,
Board approval may be sought.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
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CORPORATE GOVERNANCE STATEMENT
(n)
Diversity Policy
The Board has adopted a diversity policy which provides a framework for the Company to achieve, amongst other things,
a diverse and skilled workforce, a workplace culture characterised by inclusive practices and behaviours for the benefits
of all staff, improved employment and career development opportunities for women and a work environment that values
and utilises the contributions of employees with diverse backgrounds, experiences and perspectives. The Diversity Policy
of iCandy Interactive Limited is available on the Company's website.
This diversity policy outlines requirements for the Board to develop measurable objectives for achieving diversity, an
annually assess both the objectives and the progress in achieving those objectives. Accordingly, the Board has developed
the following objectives regarding gender diversity and aims to achieve these objectives over the next five years as
director and senior executive positions become vacant and appropriately qualified candidates becomes available.
Women on the Board
Women in Senior Executive positions
Women employed by the company
(o)
Securities trading policy
2020
2021 - 2026
No.
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%
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No.
1
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%
25%
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Directors and employees are subject to the Corporations Act restrictions on trading securities in the Company if they are
in possession of inside information. This is regarded as any information that is non-public and, if it were public, that a
reasonable person would expect to have a material effect on the price of the Company's securities.
In addition, the Company has established a policy on the trading in iCandy Interactive Limited's securities, which applies
to all Directors and employees. Key aspects of this policy are as follows:
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Directors and employees are encouraged to be long term holders of the company's securities and are
discouraged from any short-term trading;
Directors and employees may trade shares for 4 weeks following announcements of the annual results,
half year results and the annual general meeting, provided the market has been fully informed. However, a
trading embargo of 2 days applies immediately after any significant announcement;
Directors and employees need to ensure that the market is fully informed before they can trade and to
protect themselves should discuss the intended share trading with the Chairman or Company Secretary;
and
Trading outside the four-week period is required to be approved by the Chairman, prior to any transaction
occurring. Generally, if the market is fully informed, the approval will be granted.
Directors are required to notify the Company Secretary within 2 days of a change in their beneficial interest in the
Company shares.
Directors are also required to obtain a written acknowledgement of the Chairman (or the Board in the case of the
Chairman) prior to trading.
Directors' interest in the company's securities have not changed materially in the last 12 months.
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CORPORATE GOVERNANCE STATEMENT
Board Committees
(a)
(b)
(c)
(d)
(e)
Board committees and membership
Audit committee
Board Risk Oversight Committee
Board Nominations Committee
Board Remuneration Committee
Due to the size and nature of the existing Board and the magnitude of the Company's operations, the Company does not currently
have the committees listed above. Pursuant to clause 5(h) of the Company's Board Charter, the full Board carries out the duties that
would ordinarily be assigned to the above Committees under the written terms of reference for those committees.
Audit governance and independence
(a)
Approach to audit governance
The Board is committed to these basic principles:
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iCandy Interactive Limited must produce true and fair financial reports; and
Its accounting methods are comprehensive and relevant and comply with applicable accounting rules and
policies.
(b)
Engagement and rotation of external auditor
iCandy Interactive Limited's independent external auditor is Bentleys Audit & Corporate (WA) Pty Ltd.
(c)
Discussions with external auditor on independence
The Board requires the external auditor to confirm that they have maintained their independence.
(d)
Relationship with auditor
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the audit partners and any audit firm employee on the iCandy Interactive Limited's audit are prohibited
from being an officer of iCandy Interactive Limited;
an immediate family member of an audit partner or any audit firm employee on the iCandy Interactive
Limited's audit is prohibited from being a Director or an officer in a significant position at iCandy Interactive
Limited;
a former audit firm partner or employee on the iCandy Interactive Limited's audit is prohibited from being a
Director or Officer in a significant position at iCandy Interactive Limited for at least five years and after the
five years, can have no continuing financial relationship with the audit firm;
members of the audit team and firm are prohibited from having a business relationship with iCandy
Interactive Limited or any officer of iCandy Interactive Limited unless the relationship is clearly insignificant
to both parties;
the audit firm, its partners, its employees on the iCandy Interactive Limited's audit and their immediate
family members are prohibited from having a direct or material indirect investment in iCandy Interactive
Limited;
officers of iCandy Interactive Limited are prohibited form receiving any remuneration from the audit firm;
the audit firm is prohibited from having a financial interest in any company with a controlling interest in
iCandy Interactive Limited; and
the audit firm engagement team in any given year cannot include a person who have been an officer of
iCandy Interactive Limited during that year.
(e)
Restrictions on non-audit services by the external auditor
The external auditor is not restricted in the provision of non-audit services to iCandy Interactive Limited except as required
by the Corporations Act or the ASX Listing Rules.
(f)
Attendance at Annual General Meeting
iCandy Interactive Limited's external auditor attends the annual general meeting and is available to answer shareholders
questions.
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CORPORATE GOVERNANCE STATEMENT
Controlling and managing risk
(a)
Approach to risk management
Taking and managing risk are central to business and to building shareholder value. iCandy Interactive Limited's
approach is to identify, assess and control the risks which affects its business. The intention is to enable risks to be
balanced against appropriate rewards. The risk management approach links iCandy Interactive Limited's vision and
values, objectives and strategies, and procedures and training.
(b)
Risk management roles and responsibilities
The Board is responsible for approving and reviewing iCandy Interactive Limited's risk management strategy and policy.
The Board is responsible for implementing the Board-approved risk management strategy and developing policies,
controls, processes and procedures to identify and manage risks in all of iCandy Interactive Limited's activities.
iCandy Interactive Limited does not comply with ASX recommendations on these issues as it does not have a formal
verifiable system of risk management or any employees to implement such a system as it does not view this to be
appropriate at the current time. It relies on the oversight of the Directors and the various committees, together with the
periodic verification of the external auditor.
(c)
Company secretarial assurance
The Board received periodic reports about the financial conditions and operational results of iCandy Interactive Limited.
The CEO periodically provides formal statements to the Board that in all material respects:
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the company's periodic financial statements present a true and fair view of iCandy Interactive Limited's
financial condition and operational results for those reporting periods; and
that risk management and internal compliance and control systems are sound, appropriate and operating
efficiently and effectively.
Remuneration framework
(a)
Overview
The remuneration of an executive Director will be decided by the Board, without the affected executive Director
participating in that decision-making process.
The total maximum remuneration of Non-Executive Directors are initially set by the Directors and subsequent variation is
by ordinary resolution of Shareholders in general meeting in accordance with the Constitution, the Corporations Act and
the ASX listing Rules, as applicable. The determination of Directors' remuneration within that maximum will be made by
the Board having regard to the inputs and value to the Company of the respective contributions by each non-executive
Director. The current amount has been set at an amount not to excess $150,000 per annum.
In addition, a Director may be paid fees or other amounts, (e.g. subject to any necessary Shareholder approval, non-cash
performance incentives such as Options) as the Directors determine whether a Director performs special duties or
otherwise performs services outside the scope of the ordinary duties of a Director.
Directors are also entitled to be paid reasonable travelling, hotel and other expenses incurred by them respectively in or
about the performance of their duties as Directors.
The Board review and approves the remuneration policy to enable the Company to attract and retain executives and
Directors who will create value for Shareholders having consideration to the amount considered to be commensurate for a
company of its size and level of activity as well as the relevant Directors' time, commitment and responsibility. The Board
is also responsible for reviewing any employee incentive and equity-based plans including the appropriateness of
performance hurdles and total payments proposed.
(b)
Employee Share Options Scheme
There are no Employee Share Options Schemes (ESOS) granted over un-issued shares to directors or executives as part
of their remuneration. The issue of any options would require approval by Shareholders.
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CORPORATE GOVERNANCE STATEMENT
Corporate responsibility and sustainability
(a)
Approach to corporate responsibility and sustainability
iCandy Interactive Limited's approach to corporate responsibility and sustainability is to manage its business in a way that
produces positive outcomes for all stakeholders and maximises economic, social and environmental value
simultaneously. In doing so, iCandy Interactive Limited accepts that the responsibilities flowing from this go beyond both
strict legal obligations and financial bottom line. Transparency, the desire for fair dealing, and positive links into the
community underpin our everyday activities and corporate responsibility practices.
(b)
Code of conduct
iCandy Interactive Limited's Board and management are committed to their Code of Conduct (Code) which is based on
their core values and on the expectations of their clients, of shareholders and of the broader community.
The Code aims to promote a high level of professionalism and provide a benchmark for ethical and professional
behaviour throughout the Company. It also promotes a healthy, respectful workplace and environment for all their
employees.
At the same time, the Code aims to support their business reputation and corporate image within the wider community
and make employees aware of the consequences they face if they breach the Code.
The ASX recommendations require that the Code of Conduct is reviewed periodically, specifically to reflect the ASX
Corporate Governance Principles and Recommendations.
(c)
Insider trading policy and trading in iCandy Interactive Limited shares
The Company Secretary has responsibility for ensuring compliance with the continuous disclosure requirements in the
ASX Listing Rules, and overseeing and coordinating information disclosure to the ASX, analysts, brokers, shareholders,
the media and the public.
iCandy Interactive Limited is committed to giving all shareholders comprehensive and equal access to information about
our activities, and to fulfil continuous disclosure obligations to the broader market. iCandy Interactive Limited's policy is
designed to ensure compliance with ASX Listing Rules continuous disclosure requirements. It ensures any information
that a reasonable person would expect to have a material effect on the price of iCandy Interactive Limited's securities is
disclosed.
iCandy Interactive Limited currently maintains its own website and relies on communication in this medium and the ASX Company
Announcements platform carrying all the relevant information.
Compliance with ASX Corporate Governance Council Good Practice Recommendations
The table below outlines each of the ASX Best Practice Recommendations and the Company's compliance with those
recommendations. Where the Company has met the relevant recommendation during the reporting period, this is indicated by a
"YES" in the relevant column. Where the Company has not met or complied with a recommendation, this is indicated by a "NO" and
an accompanying note explaining the reasons why the Company has not met the recommendation.
Principles and Recommendations
Complied
Note
Principle 1: Lay solid foundations for management and oversight
Recommendation 1.1
A listed entity should have and disclose a board charter setting out:
(a)
(b)
the respective roles and responsibilities of its board and management; and
those matters expressly reserved to the board and those delegated to management.
Recommendation 1.2
A listed entity should:
(a)
undertake appropriate checks before appointing a director or senior executive or putting
someone forward for election as a director; and
provide security holders with all material information in its possession relevant to a decision on
whether or not to elect or re-elect a director.
(b)
Yes
Yes
Recommendations 1.3
A listed entity should have a written agreement with each director and senior executive setting out the
terms of their appointment.
Yes
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CORPORATE GOVERNANCE STATEMENT
Recommendations 1.4
The company secretary of a listed entity should be accountable directly to the board, through the
chair, on all matters to do with the proper functioning of the board.
Recommendation 1.5
A listed entity should:
(a)
(b)
have and disclose a diversity policy;
through its board or a committee of the board set measurable objectives for achieving gender
diversity in the composition of its board, senior executives and workforce generally; and
disclose in relation to each reporting period:
(c)
the measurable objectives set for that period to achieve gender diversity;
the entity's progress towards achieving those objectives; and
(1)
(2)
(3) either:
(A)
(B)
the respective proportions of men and women on the board, in senior executive positions
and across the whole workforce (including how the entity has defined "senior executive" for
these purposes); or
if the entity is a "relevant employer" under the Workplace Gender Equality Act, the entity's
most recent "Gender Equality Indicators", as defined in and published under that Act.
Recommendation 1.6
A listed entity should:
(a)
have and disclose a process for periodically evaluating the performance of the board, its
committees and individual directors; and
disclose for each reporting period whether a performance evaluation has been undertaken in
accordance with that process during or in respect of that period.
(b)
Recommendation 1.7
A listed entity should:
(a)
have and disclose a process for evaluating the performance of its senior executives at least
once every reporting period; and
disclose for each reporting period whether a performance evaluation has been undertaken in
accordance with that process during or in respect of that period.
(b)
Principle 2: Structure the Board to be effective and add value
Recommendation 2.1
The board of a listed entity should:
(a)
have a nomination committee which:
(1)
(2)
has at least three members, a majority of whom are independent directors; and
is chaired by an independent director,
and disclose:
(3)
(4)
(5)
the charter of that committee;
the members of the committee; and
as at the end of each reporting period, the number of times the committee met throughout
the period and the individual attendances of the members at those meetings; or
(b)
if it does not have a nomination committee, disclose that fact and the processes it employs to
address board succession issues and to ensure that the board has the appropriate balance of
skills, knowledge, experience, independence and diversity to enable it to discharge its duties
and responsibilities effectively.
Yes
Yes
No
No
No
1
2
3
Recommendations 2.2
A listed entity should have and disclose a board skills matrix setting out the mix of skills that the
board currently has or is looking to achieve in its membership.
Yes
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CORPORATE GOVERNANCE STATEMENT
Recommendation 2.3
A listed entity should disclose:
(a)
(b)
the names of the directors considered by the board to be independent directors;
if a director has an interest, position, affiliation or relationship of the type described in Box 2.3
but the board is of the opinion that it does not comprise the independence of the director, the
nature of the interest, position or relationship in question and an explanation of why the board is
of that opinion; and
the length of service of each director.
(c)
Recommendations 2.4
A majority of the board of a listed entity should be independent directors.
Recommendations 2.5
The chair of the board of a listed entity should be an independent director and, in particular, should
not be the same person as the CEO of the entity.
Recommendations 2.6
A listed entity should have a program for inducting new directors and for periodically reviewing
whether there is a need for existing directors to undertake professional development to maintain the
skills and knowledge needed to perform their role as directors effectively.
Principle 3 - Instil a culture of acting lawfully, ethically and responsibly
Recommendation 3.1
A listed entity should articulate and disclose its values.
Recommendation 3.2
A listed entity should:
(a)
(b)
have and disclose a code of conduct for its directors, senior executives and employees; and
ensure that the board or a committee of the board is informed of any material breaches of that
code by a director or senior executive; and
any other material breaches of that code that call into question the culture of the organisation.
(c)
Recommendation 3.3
A listed entity should:
(a)
(b)
have and disclose a whistle-blower policy; and
ensure that the board or a committee of the board is informed of any material incidents reported
under that policy.
4
Yes
Yes
No
Yes
Yes
Yes
Yes
Recommendation 3.4
A listed entity should:
(a)
(b)
have and disclose an anti-bribery and corruption policy; and
ensure that the board or committee of the board is informed of any material breaches of that
policy.
No
5
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CORPORATE GOVERNANCE STATEMENT
Principle 4 - Safeguard the integrity of corporate reports
Recommendation 4.1
The board of a listed entity should:
(a)
have an audit committee which:
No
6
(1)
(2)
has at least three members, a majority of whom are non-executive directors and a majority
of whom are independent directors; and
is chaired by an independent director, who is not the chair of the board,
and disclose:
(3)
(4)
(5)
the charter of that committee;
the relevant qualifications and experience of the members of the committee; and
in relation to each reporting period, the number of times the committee met throughout the
period and the individual attendances of the members at those meetings; or
(b)
if it does not have an audit committee, disclose that fact and the process it employs that
independently verify and safeguard the integrity of its corporate reporting, including the
processes for the appointment and removal of the external auditor and the rotation of the audit
engagement partner.
Recommendations 4.2
The board of a listed entity should, before it approves the entity's financial statements for a financial
period, receive from its CEO and CFO a declaration that, in their opinion, the financial records of the
entity have been properly maintained and that the financial statements comply with the appropriate
accounting standards and give a true and fair view of the financial position and performance of the
entity and that the opinion has been formed on the basis of a sound system of risk management and
internal control which is operating effectively.
Yes
Recommendations 4.3
A listed entity should disclose its processes to verify the integrity of any periodic corporate report it
releases to the market that is not audited or reviewed by an external auditor.
Yes
Principle 5 - Make timely and balanced disclosure
Recommendations 5.1
A listed entity should have and disclose a written policy for complying with its continuous disclose
obligations under listing rule 3.1
Recommendations 5.2
A listed entity should ensure that its board receives copies of all material market announcements
promptly after they have been made.
Recommendations 5.3
A listed entity that gives a new and substantive investor or analyst presentation should release a
copy of the presentation materials on the ASX Market Announcements Platform ahead of the
presentation.
Yes
Yes
Yes
Principle 6 - Respect the rights of security holders
Recommendations 6.1
A listed entity should provide information about itself and its governance to investors via its website.
Yes
Recommendations 6.2
A listed entity should have an investor relations program that facilitates effective two-way
communication with investors.
Recommendations 6.3
A listed entity should disclose how it facilitates and encourages participation at meetings of security
holders.
Yes
Yes
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For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CORPORATE GOVERNANCE STATEMENT
Recommendations 6.4
A listed entity should ensure that all substantive resolutions at a meeting of security holders are
decided by a poll rather than by a show of hands.
Recommendations 6.5
A listed entity should give security holders the option to receive communications from, and send
communications to, the entity and its security registry electronically.
Yes
Yes
Principle 7 - Recognise and manage risk
Recommendation 7.1
The board of a listed entity should:
(a)
have a committee or committees to oversee risk, each of which:
No
7
(1)
(2)
has at least three members, a majority of whom are independent directors; and
is chaired by an independent director,
and disclose:
(3)
(4)
(5)
the charter of that committee;
the members of the committee; and
in relation to each reporting period, the number of times the committee met throughout the
period and the individual attendances of the members at those meetings; or
(b)
If it does not have a risk committee or committees that satisfy (a) above, disclose that fact and
the processes it employs for overseeing the entity's risk management framework.
Recommendation 7.2
The board or a committee of the board should:
(a)
review the entity's risk management framework at least annually to satisfy itself that it continues
to be sound and that the entity is operating with due regard to the risk appetite set by the board;
and
disclose, in relation to each reporting period, whether such a review has taken place.
(b)
Recommendation 7.3
A listed entity should disclose:
(a)
(b)
if it has an internal audit function, how the function is structure and what role it performs; or
if it does not have any internal audit function, that fact and the processes it employs for
evaluating and continually improving the effectiveness of its governance, risk management and
internal control processes.
Yes
Yes
Recommendations 7.4
A listed entity should disclose whether it has any material exposure to environmental or social risks
and, if it does, how it manages or intends to manage those risks.
Yes
Principle 8 -Remunerate fairly and responsibly
Recommendation 8.1
The board of a listed entity should:
(a)
have a remuneration committee which:
(1)
(2)
has at least three members, a majority of whom are independent directors; and
is chaired by an independent director,
and disclose:
(3)
(4)
(5)
the charter of that committee;
the members of the committee; and
in relation to each reporting period, the number of times the committee met throughout the
period and the individual attendances of the members at those meetings; or
(b)
if it does not have a remuneration committee, disclose that fact and the processes it employs for
setting the level and composition of remuneration for directors and senior executives and
ensuring that such remuneration is appropriate and not excessive.
No
8
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
11
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CORPORATE GOVERNANCE STATEMENT
Recommendations 8.2
A listed entity should separately disclose its policies and practices regarding the remuneration of non-
executive directors and the remuneration of executive directors and other senior executives.
Yes
Recommendation 8.3
A listed entity which has an equity-based remuneration scheme should:
(a)
have a policy on whether participants are permitted to enter into transactions (whether through
the use of derivatives or otherwise) which limit the economic risk of participating in the scheme;
and
No
9
(b)
disclose that policy or a summary of it.
Note 1
The Board is responsible for evaluating the performance of the Board and individual Directors will be evaluated on an annual basis,
with the aid of an independent advisor, if deemed required. The Company's Corporate Governance Plan requires the Board to
disclose whether or not performance evaluations were conducted during the relevant reporting period with details of the
performance evaluations conducted will be provided in the Company's Annual Report. No evaluation has taken place to the date of
this report.
Note 2
The Company has not undertaken a performance evaluation of its senior executives noting that the Company currently does not
employ any executives. Performance reviews will take place once senior executive roles are occupied.
Note 3
Due to the size and nature of the existing Board, the Company does not currently have a Nomination Committee. The full Board
carries out the duties that would ordinarily be assigned to the Nomination Committee and the Board devotes time on an annual
basis to discuss Board succession issues. All members of the Board are involved in the Company's nomination process, to the
maximum extent permitted under the Corporations Act and ASX Listing Rules.
Note 4
The current Chairman of the Company, is not deemed an independent director due to his indirect shareholdings in the Company via
Fatfish Blockchain Limited, of which he is an Executive Director.
Note 5
The Company does not currently operate under a documented Anti-bribery and corruption policy given the size, nature and
geographical location of its operations.
Note 6
Due to the size and nature of the existing Board, the Company does not currently have Audit Committee. The full Board carries out
the duties that would ordinarily be assigned to the Audit Committee under the written terms of reference for that committee and
devotes time annually to fulfilling the roles and responsibilities associated with maintaining the Company's internal audit function
and arrangements with external auditors. All members of the Board are involved in the Company's audit function to ensure the
proper maintenance of the entity and the integrity of all financial report.
Note 7
Due to the size and nature of the existing Board, the Company does not currently have a Risk Management Committee. The full
Board carries out the duties that would ordinarily be assigned to the Risk Management Committee and devotes time annually to
fulfilling the roles and responsibilities associated with overseeing risk and maintaining the entity's risk management framework and
associated internal compliance and control procedures.
Note 8
Due to the size and nature of the existing Board, the Company does not currently have a Remuneration Committee. The full Board
carries out the duties that would ordinarily be assigned to the Remuneration Committee and devotes time annually to fulfilling the
roles and responsibilities associated with setting the level and composition of remuneration for Directors, ensuring that such
remuneration is appropriate and not excessive.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
12
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CORPORATE GOVERNANCE STATEMENT
Note 9
The Company does not currently have any equity based remuneration schemes in place.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
13
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Your directors present their report on the consolidated entity (referred to herein as the Group) consisting of iCandy Interactive Limited and its
controlled entities for the financial period ended 31 December 2020.
General Information
Directors
The following persons were directors of iCandy Interactive Limited during the whole of the financial period and up to the date of this report,
unless otherwise stated.
Kin Wai Lau
Executive Director and Chairman
Appointed on 20 March 2015
Robert Kolodziej
Non-Executive Director
Appointed 27 May 2015
Kin Wai is a serial tech entrepreneur with extensive international start-
up, senior management and investment experience.
Since founding his first company at age 23, Kin Wai has built companies
across telecom software, internet media and biotech. He is one of the
handful of entrepreneurs in Southeast Asia that have real track-record of
multiple exists. Kin Wai was named by the media as one of the
youngest ever MDs of a publicly traded firm in Southeast Asia when he
IPO'd his first company at the age of 28. He has since been involved in
building other tech companies, with three of them being listed on major
stock exchanges in the region.
Kin Wai began his career as research staff and a PhD candidate at the
Imperial College, London, before starting up his own company.
Kin Wai frequently supports entrepreneurial campaigns in colleges and
universities and is a regular judge at innovation and start-up
competitions in Singapore.
Kin Wai graduated with first class honours in Electronics & Electrical
Engineering from the University of Manchester, United Kingdom. He
also has a Master in Business, Administration from the University of
Oxford.
Other current directorships of listed companies
Fatfish Blockchain Limited - appointed July 2014
Former directorships of listed companies in last three years
N/A
Robert is a senior advisor at Bell Porter Securities and has over 20
years' experience in investment management. He has wide
macroeconomic understanding across many areas of financial markets
and specialises in strategic investment advice for high net worth clients,
small cap fund managers and family officers.
Robert has expertise with small capitalisation companies especially in
the technology and renewable sector and has been arranging
transactions in equity capital markets for these companies. Prior to
working in stockbroking, Robert worked for Ernst & Young in the
property trust area while at the same time running a business
specialising in eco-tourism. Since then, he has worked in the property
development sector specialising in due diligence and strategy.
Separately from his role at Bell Potter Securities, he is also an Executive
Director at Kollins Capital, a financial services and corporate advisory
firm.
Other current directorships of listed companies
N/A
Former directorships of listed companies in last three years
N/A
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
14
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Marcus Ungar
Non-Executive Director
Appointed 1 April 2018
Christopher Whiteman
Non-Executive Director
Appointed 3 March 2021
Lum Piew
Executive Director
Resigned 3 March 2021
Marcus is a founding member of CGAM Pty Ltd which is a private equity
firm based in Sydney. CGAM invests in innovative, high quality
technology companies seeking growth stage investment. He is currently
the CEO of Investorlend Pty Limited. Investorlend is an investment
platform which enables its investors to participate in commercial loans
and equity linked investments.
Marcus has also continued his association with Compass Global
Markets which specialises in foreign exchange and international
payments.
Other current directorships of listed companies
N/A
Former directorships of listed companies in last three years
N/A
Mr Whiteman is a Corporate and Commercial Adviser with experience
across multiple sectors including energy, resources and wealth
management. Mr Whiteman has specific expertise in commercial
negotiations, equity capital markets and deal structuring, investor and
public relations, and strategic planning, gained through assignments
with both public and private companies in Australia, the United Kingdom,
and China. At leading independent corporate advisory firm Taylor
Collison, Mr Whiteman originated and managed investment
opportunities for an extensive client network, including inbound
investment from Asia.
Within the corporate landscape, Mr Whiteman has worked in senior
roles with a number of Australia's leading energy companies including
Santos Limited and TXU Australia, and international companies Royal
Dutch Shell and Credit Suisse First Boston.
He holds a Bachelor's Degree in Economics from the University of
Adelaide and a Graduate Diploma in Applied Finance and Investment
from FINSIA.
Other current directorships of listed companies
N/A
Former directorships of listed companies in last three years
Animoca Brands Corporation Limited (Delisted February 2020)
Lum Piew spent 26 years engaged in technology and management
consulting with Accenture. He has led the Communications, Media and
Technology practice in Malaysia as its Managing Director over the last
12 years.
His extensive experience includes managing large-scale digital
transformation programs. He grew the Accenture practice from
consulting to outsourcing, and pivoting to digital transformation serving
clients across telco's, media and internet companies including Telenor,
Grab, Google and Facebook. At its peak, the Malaysia practice was
Accenture's largest practice in both revenues and staff numbers in
Southeast Asia.
Other current directorships of listed companies
N/A
Former directorships of listed companies in last three years
N/A
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
15
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Masahiko Honma
Non-Executive Director
Resigned 3 March 2021
Mr Honma is the founder of IncubateFund. Mr Honma started his career
with overseeing information technology investments in Silicon Valley at
JAFCO's overseas investment arm. He has also held roles in
Accenture's venture capital arm and in 2007 founded Core People
Partners, a fund specialising in incubation of internet businesses.
Mr Honma has a stellar track record of creating and supporting mobile
gaming start-ups including Pokelabo and Gumi. Both have grown from 2
to 3 persons teams when Mr Honma joined as the first outside investor
in 2008, into companies with 280 and 400 employees respectively.
Pokelabo, which Mr Honma co-founded and took the first CEO role of
was successfully acquired by GREE, mobile gaming giant in Japan, with
the valuation of over US$174 million in an all-cash deal in 2012.
Other current directorships of listed companies
N/A
Former directorships of listed companies in last three years
N/A
Company Secretary
Mr Andrew Draffin and Ms Jiahui Lan
Appointed 1 April 2018
Andrew is a director of the accounting firm DW Accounting & Advisory Pty Ltd. He holds a Bachelor of Commerce and is a member of the
Chartered Accountants Australia and New Zealand. Andrew is a Director, Chief Financial Offer and Company Secretary of listed, unlisted
and private companies across a broad range of industries. His focus is on financial reporting, treasury management, management
accounting and corporate services, areas where he has gained over 19 years experience.
Jiahui is a director of the accounting firm DW Accounting & Advisory Pty Ltd. She holds a Bachelor of Business (Accounting). Jiahui is a
Director and Company Secretary of listed, unlisted and private companies across a range of industries. Her focus is on financial reporting,
management accounting and corporate services, areas where she has gained over 11 years experience.
Shareholdings of directors and other key management personnel
The interest of each Director and other key management personnel, directly and indirectly, in the shares and options of the Company at the
date of this report are as follows:
Date of this report
31 December 2020
Ordinary Shares
Share Options
Ordinary Shares
Share Options
Kin Wai Lau1
Robert Kolodziej
Marcus Ungar
Christopher Whiteman2 (appointed 3 March 2021)
Lum Piew (resigned 3 March 2021)
Masahiko Honma (resigned 3 March 2021)
192,500,001
250,000
-
41,008,415
-
-
-
-
-
-
-
-
192,500,001
250,000
-
41,008,415
-
-
-
-
-
-
-
-
1Shares are held in Fatfish Internet Pte Ltd, a subsidiary of Fatfish Blockchain Limited, of which Mr Kin Wai Lau is a director.
2Shares held in Animoca Brands Limited, a 100% owned subsidiary of Animoca Brands Corporation Limited of which Mr Whiteman is a Non-
Executive director.
Meetings of directors
During the financial year, 12 meetings of directors (including circular resolutions) were held.
Attendances by each director during the year were as follows:
Kin Wai Lau
Robert Kolodziej
Marcus Ungar
Christopher Whiteman (appointed 3 March 2021)
Lum Piew (resigned 3 March 2021)
Masahiko Honma (resigned 3 March 2021)
Directors' Meetings
Number eligible to
attend
12
12
12
-
12
12
Number attend
12
12
12
-
12
12
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
16
For personal use only
ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Principle Activities and Significant Changes in Nature of Activities
The Company's business plan is to develop and publish 'freemium' games for smartphones, which are free-to-download and free-to-play for
players. The 'freemium' game model is proven to be a successful business model employed by many global mobile game companies. The
Company plans to generate revenue through the following approaches.
-
-
-
-
In-game purchases - players can purchase virtual items or currencies which are used within the Company's games to improve
character levels, speed up the game progress and/or enhance playing experience;
Mobile advertising - which allows iCandy to advertise third-party products and services in the Company's games;
Game merchandise sales - players can purchase game related merchandise branded with logos and artwork of the Company's
various games; and
Publishing of games - publishing of mobile interactive entertainment for multiple mobile operating system platforms.
Review of Operations
During the financial year ended 31 December 2020, the Group attained its highest ever sales revenue of A$3.6 million, a 61% increase in
revenue from A$2.2 million a year ago. This has contributed to the Group recording its first ever positive EBITDA (earnings before interest,
tax, depreciation and amortisation) of A$1,376,973.
The Group’s robust increase in revenue was attributed to the successful launching of iCandy’s popular new game Masketeers: Idle Has
Fallen (“Masketeers”).
To further drive revenue in FY2021, iCandy will be undertaking the following initiatives:
(a)
(b)
Release its new game, Claw Stars which has shown promising early trial results that exceed Masketeers;
Expanding the distribution channels of iCandy’s mobile games, specifically into China, the world’s largest gaming market through
iCandy’s partnership with Ohayoo; and
(c)
JV with leading global game animation and art studio, Lemon Sky Studios to create 3D games with AAA visuals and animation.
Operating Results
The consolidated loss of the consolidated entity after providing for income tax amounted to $46,270. (2019: loss of $2,323,035)
Financial Position
The net assets of the Group have increased by $13,072,226 from $2,381,871 as at 31 December 2019 to $15,454,097 as at 31 December
2020.
Dividend Paid or Recommended
It is not recommended that a dividend be declared and no dividends were paid or declared during and since the end of the financial year.
Matters Subsequent to the End of the Financial Year
On 5 January 2021, the Company issued 9,150,000 fully paid ordinary shares. These were issued as a result of 9,150,000 ICIOBs being
exercised. A total of $228,750 was raised.
On 5 January 2021, the Company announced it has successfully concluded and signed off a definitive joint venture agreement with Lemon
Sky Studios, and a joint venture company, Sky Candy Sdn Bhd has been incorporated in Malaysia.
On 22 January 2021, the Company issued 6,668,750 fully paid ordinary shares. These were issued as a result of 6,668,750 ICIOBs being
exercised. A total of $168,719 was raised.
On 12 February 2021, the Company issued 6,244,100 fully paid ordinary shares. These were issued as a result of 6,244,100 ICIOBs being
exercised. A total of $156,102 was raised.
On 15 February 2021, the Company announced it entered into a conditional Share Sale Agreement with Swedish incorporated RightBridge
Ventures AB to discpose of its 100% owned subsidiary, iCandy Digital Pte Ltd. This transaction is subjected to Shareholder's approval under
Listing Rule 11.4
On 3 March 2021, the Company issued 2,380,000 fully paid ordinary shares. These were issued as a result of 2,380,000 ICIOBs being
exercised. A total of $59,500 was raised.
On 3 March 2021, the Company announced Mr Masahiko Honma and Mr Lum Piew have resigned. Mr Christopher Whiteman has been
appointed as a Non-Executive Director.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
17
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
On 19 March 2021, the Company announced that it has entered into an agreement to acquire 100% voting capital of Nextgamer.io, a mobile
game platform and game developer in the business of developing a hyper-casual competitive video games and platform. The total acquisition
consideration is AUD$1,290,000, to be satisfied in cash of AUD$900,000 and 3 million fully paid ordinary shares at a deemed issue price of
AUD$0.13 per share.
On 26 March 2021, the Company issued 7,163,722 fully paid ordinary shares. These were issued as a result of 3,700,000 ICIOBs, 1,241,500
unlisted options with an exercise price of $0.08 and 2,222,222 unlisted options with an exercise price of $0.05 being exercised. A total of
$302,931 was raised.
On 29 March 2021, the Company issued 3,000,000 fully paid ordinary shares. These were issued as part settlement for the acquisition of
Nextgamer.io, announced on 19 March 2021.
On 29 March 2021, the Company issued 250,002 unlisted options with an exercise price of $0.13, expiry date of 31 March 2025. These
options were issued under the Company's ESOS plan.
Future Developments
The Company plans to implement its business strategy as outlined above.
The Company will continue to keep stakeholders informed of any future developments via its compliance with the continuous disclosure
requirements.
Environmental Issues
The Company's operations are not regulated by any significant environmental regulation under a law of the Commonwealth or of a State or
Territory.
Audit/Non-Audit Services
Auditors' remuneration is disclosed In Note 6. No non-audit services have been provided by the auditor or their related practices.
Indemnifying Officers or Auditors
An indemnity has been given by the Company in favour of the directors to the extent that Corporations Act 2001 allows. No payment or
agreement has been given in relation to a premium in respect of a contract insuring against a liability incurred as an officer for the costs or
expenses to defend legal proceedings.
No other insurance premiums of indemnity has been paid or provided in respect of any directors or auditors.
Capital Raising and Capital Structure
As at 31 December 2020, the Company has 547,313,849 fully paid ordinary shares. During the year, a total of 210,123,205 fully paid ordinary
shares were issued. Please refer to Note 19 - Issued capital for further details.
Summary of Options
Table below reflects the options on issue at the date this of report.
Issuing entity
Issue Date
iCandy Interactive Limited
21 December 2020
Number of shares
under option
45,532,143
iCandy Interactive Limited
21 December 2020
42,357,150
Class of shares
Exercise Price
Expiry Date
Listed Options
(ICIOAs)
Listed Options
(ICIOBs)
$0.220
$0.025
$0.080
$0.060
$0.050
15 December
2022
31 December
2022
14 June 2021
22 July 2022
31 December
2022
iCandy Interactive Limited
14 June 2019
6,851,050
Unlisted options
iCandy Interactive Limited
22 July 2019
633,332
Unlisted options
iCandy Interactive Limited
5 January 2021 & 22
January 2021
26,444,444
Unlisted options
iCandy Interactive Limited
29 March 2021
250,002
Unlisted options
$0.130
31 March 2025
Option holders do not have any rights to participate in any issues or other interest in the company or any other entity.
For details of options issued to directors and executives as remuneration, refer to Remuneration Report.
There have been no shares issued since the end of the financial year resulting from exercise of options.
Proceedings on Behalf of Company
No person has applied for leave of Court to bring proceedings on behalf of the Company or intervene in any proceedings to which the
Company is a party for the purpose of taking responsibility on behalf of the company for all or any part of those proceedings.
The Company was not a party to any such proceedings during the year.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
18
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Auditor's Independence Declaration
A copy of the auditor's independence declaration as required by section 307c of the Corporations Act 2001 is attached on page 21.
REMUNERATION REPORT - AUDITED
This remuneration report sets out remuneration information for non-executive directors, executive directors and other key management
personnel.
Remuneration Policies
Remuneration levels are competively set to attract the most qualified and experienced Directors and Senior Executives. The Board may
obtain independent advice on the appropriateness of remuneration packages. No independent advice was sought during or since the end of
the period under review with regards to remuneration.
There are no schemes for retirement benefits.
The directors are reimbursed for expenses incurred by them in the course of their duties as directors of the company.
There is no link between the provision of any monetary benefits and performance of the company.
The Group's earnings and movement in shareholder's wealth for the past five years are detailed in the following table:
31 December 2020
31 December 2019
31 December 2018
31 December 2017
31 December
2016
Revenue
Net (loss) before tax
Net (loss) after tax
Share price at start of the
year
Share price at end of the
year
Dividends paid
Basic (loss) per share
3,592,855 2,237,230 2,815,704 1,656,454 1,573,617
(44,046) (2,312,065) (3,480,281) (3,362,941) (408,768)
(46,270) (2,323,035) (3,445,405) (3,113,914) (422,090)
$0.00
$0.14
$0.05
$0.03
$0.16
$0.13
$0.03
$0.05
$0.16
$0.14
- - - - -
(0.08) (0.68) (1.18) (1.23) (0.19)
Key management remuneration policy
The key management personnel of the company are represented by the directors.
The key management personnel remuneration policy is therefore the same as the directors' remuneration policy.
Directors and executives disclosed in this report
Name
Kin Wai Lau
Robert Kolodziej
Marcus Ungar
Christopher Whiteman (appointed 3 March 2021)
Lum Piew (resigned 3 March 2021)
Masahiko Honma (resigned 3 March 2021)
Position Held
Executive Director and Chairman
Non-Executive Director
Non-Executive Director
Non-Executive Director
Executive Director
Non-Executive Director
Remuneration of Directors and Other Key Management Personnel (KMP) for the Year Ended 31 December 2020
Salaries, fees and
leave
Shares,
Options/Incentive
Rights
Superannuation
Total
Kin Wai Lau
Robert Kolodziej
Marcus Ungar
Christopher Whiteman (appointed 3 March 2021)
Lum Piew (resigned 3 March 2021)
Masahiko Honma (resigned 3 March 2021)
- - 151,308
151,308
- - 12,000
12,000
- - 18,000
18,000
- - - -
- - - -
- - - -
- - 181,308
181,308
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
19
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
DIRECTORS' REPORT
Remuneration of Directors and Other Key Management Personnel (KMP) for the Year Ended 31 December 2019
Kin Wai Lau
Lum Piew (appointed 17 May 2019)
Robert Kolodziej
Marcus Ungar
Masahiko Honma
Phillip Lord (Resigned 21 June 2019)
Salaries, fees and
leave
Shares,
Options/Incentive
Rights
Superannuation
Total
- - 25,309
25,309
- - 24,500
24,500
- - 12,000
12,000
- - 18,000
18,000
- - - -
- - 38,000
38,000
- - 117,809
117,809
No post-employment benefits were paid to the directors. The directors do not participate in any incentive programs.
KMP Shareholdings
The number of ordinary shares in iCandy Interactive Limited held by each KMP of the Group during the financial year are as follows:
Name
Kin Wai Lau1
Robert Kolodziej
Marcus Ungar
Christopher Whiteman2
(appointed 3 March 2021)
Lum Piew (resigned 3
March 2021)
Masahiko Honma (resigned
3 March 2021)
Balance at beginning
of year
Granted as
remuneration during
the year
Issued on exercise of
options during the
year
Other changes
during the year
Balance at end
of year
- - - 192,500,001
192,500,001
- - - 250,000
250,000
- - - - -
44,475,833
- - - 44,475,833
- - - - -
- - - - -
1Shares are held in Fatfish Internet Pte Ltd, a subsidiary of Fatfish Blockchain Limited, of which Mr Kin Wai Lau is a director.
2Shares held in Animoca Brands Limited, a 100% owned subsidiary of Animoca Brands Corporation Limited of which Mr Whiteman is a Non-
Executive director.
The number of listed and unlisted options in iCandy Interactive Limited held by each KMP of the Group during the financial year are as
Name
Balance at beginning
of year
Granted as
remuneration during
the year
Issued on exercise of
options during the
year
Other changes
during the year
Balance at end
of year
Kin Wai Lau
- - - - -
Robert Kolodziej
Marcus Ungar
Christopher Whiteman
(appointed 3 March 2021)
Lum Piew (resigned 3
March 2021)
Masahiko Honma (resigned
3 March 2021)
- - - - -
- - - - -
-
- - - -
- - - - -
- - - - -
Share options granted to directors and executives
No shares or options were granted to Directors or Executives during the year.
At the end of the financial year, no unlisted options were held by any Director and other key management personnel, directly and indirectly.
Other transactions and balances with Key Management Personnel:
There were no other transactions and balances during the reporting period. In 2017, Mr Kin Wai Lau had loaned Appxplore (iCandy) Limited
AUD $196,290 (SGD $200,000).
This concludes the remuneration report, which has been audited.
The Directors' Report, incorporating the Remuneration Report, is signed in accordance with a resolution of the Board of Directors made
pursuant to s.298(2) of the Corporations Act 2001.
Mr Kin Wai Lau
Director
Dated 31 March 2021
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
20
For personal use only To The Board of Directors
Auditor’s Independence Declaration under Section 307C of the
Corporations Act 2001
As lead audit partner for the audit of the financial statements of iCandy Interactive
Limited for the financial year ended 31 December 2020, I declare that to the best of my
knowledge and belief, there have been no contraventions of:
the auditor independence requirements of the Corporations Act 2001 in relation to
the audit; and
any applicable code of professional conduct in relation to the audit.
Yours faithfully
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Partner
Dated at Perth this 31st day of March 2021
For personal use only
ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 31 DECEMBER 2020
Continuing operations
Revenue
Other income
Cost of sales
Marketing expenses
Audit fees
Provision for doubtful debts
Legal and professional fees
Share based payments
Occupancy expenses
Employee benefits expense
Depreciation and amortisation expense
Impairment expense
Interest expense
Computer expenses
Other expenses
Travel expenses
Unrealised movement in fair value of intangibles
Share of net profits of associates and joint ventures
Loss before income tax
Tax expense
Loss for the year attributable to members of the company
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss when
specific conditions are met:
Exchange differences on translating foreign operations, net of tax
Note
3
3
15
4
Total other comprehensive income for the year
Total comprehensive income for the year
Net profit attributable to:
Owners of the parent entity
Non-controlling interest
Total comprehensive income attributable to:
Members of the parent entity
Non-controlling interest
Earnings per share
Basic earnings per share (cents)
Diluted earnings per share (cents)
Group
2020
$
2019
$
3,592,855
510,681
(1,476,277)
2,627,259
(32,019)
(50,084)
-
(270,140)
-
(17,685)
(609,741)
(1,067,993)
(353,026)
-
(25,395)
(351,845)
(4,228)
133,467
(22,616)
(44,046)
(2,224)
(46,270)
(340,764)
(340,764)
(340,764)
(387,034)
(302,312)
256,042
(46,270)
(649,613)
262,579
(387,034)
2,237,230
247,680
(1,805,479)
679,431
(17,458)
(56,680)
(6,183)
(247,390)
(111,625)
(16,769)
(882,080)
(1,090,949)
(180,000)
(6,001)
(1,113)
(149,621)
(48,250)
(94,621)
(82,756)
(2,312,065)
(10,970)
(2,323,035)
120,353
120,353
120,353
(2,202,682)
(2,223,264)
(99,771)
(2,323,035)
(2,101,410)
(101,272)
(2,202,682)
7
7
(0.08)
(0.08)
(0.68)
(0.68)
The accompanying notes form part of these financial statements.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
22
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2020
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other financial assets
Other assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Property, plant and equipment
Intangible assets
Investments accounted for using the equity method
Right-of-use assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Lease liabilities
Other financial liabilities
Current tax liabilities
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Deferred tax liabilities
Lease liabilities
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained earnings
Equity attributable to owners of the parent entity
Non-controlling interest
TOTAL EQUITY
Group
Note
2020
$
2019
$
8
9
10
14
12
13
15
18
16
18
17
4
18
19
27
11,826,228
1,454,978
1,248,758
228,424
14,758,388
112,518
2,677,469
-
200,979
2,990,966
17,749,354
1,609,160
88,173
480,790
-
2,178,123
3,342
113,792
117,134
2,295,257
15,454,097
42,700,446
(18,531,180)
(8,852,411)
15,316,855
137,242
15,454,097
414,229
352,513
1,415,336
70,817
2,252,895
124,273
1,747,035
22,806
49,933
1,944,047
4,196,942
1,009,471
53,219
742,905
1,539
1,807,134
7,937
-
7,937
1,815,071
2,381,871
30,306,207
(19,226,026)
(8,572,973)
2,507,208
(125,337)
2,381,871
The accompanying notes form part of these financial statements.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
23
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2020
Issued Capital
Accumulated
Losses
$
$
Foreign
Currency
Translation
R
$
Reserve
Option Reserve
Other
Components of
Equity
Subtotal
Non-controlling
interests
Total
$
$
$
$
$
Consolidated Group
Balance at 1 January 2019
Effect of adoption of AASB 16
29,201,668
(6,345,683)
(57,471)
457,457
(20,289,999)
2,965,972
-
(4,026)
-
-
-
(4,026)
Balance at 1 January 2019 (restated)
29,201,668
(6,349,709)
(57,471)
457,457
(20,289,999)
2,961,946
-
-
-
2,965,972
(4,026)
2,961,946
Total transactions with owners and other transfers
1,104,539
Balance at 31 December 2019
30,306,207
(8,572,973)
64,383
999,590
(20,289,999)
2,507,208
(125,337)
2,381,871
Comprehensive income
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
Transactions with owners, in their capacity as
owners, and other transfers
Shares issued during the year
Transaction costs
Options issued during the year
Recognition of non-controlling interest in PT Joyseed
Berbagi Sukses
Balance at 1 January 2020
Comprehensive income
Loss for the year
Other comprehensive income for the year
Total comprehensive income for the year
Transactions with owners, in their capacity as
owners, and other transfers
Shares issued during the year
Transaction costs
Opions expired during the year
Options issued during the year
-
-
-
(2,223,264)
-
(2,223,264)
-
121,854
121,854
1,711,605
(607,066)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
542,133
-
542,133
-
-
-
-
-
-
-
-
(2,223,264)
121,854
(2,101,410)
(99,771)
(1,501)
(2,323,035)
120,353
(101,272)
(2,202,682)
1,711,605
(607,066)
542,133
-
-
-
-
(24,065)
1,711,605
(607,066)
542,133
(24,065)
1,646,672
(24,065)
1,622,607
30,306,207
(8,572,973)
64,383
999,590
(20,289,999)
2,507,208
(125,337)
2,381,871
-
-
-
(302,312)
-
(302,312)
-
(347,301)
(347,301)
-
-
-
14,932,254
(2,538,015)
-
-
-
-
22,874
-
22,874
-
-
-
-
-
(694,489)
-
(22,874)
1,759,510
1,042,147
-
-
-
-
-
-
-
-
(302,312)
(347,301)
(649,613)
256,042
6,537
262,579
(46,270)
(340,764)
(387,034)
14,237,765
(2,538,015)
-
1,759,510
13,459,260
-
-
-
-
-
14,237,765
(2,538,015)
-
1,759,510
13,459,260
Total transactions with owners and other transfers
12,394,239
Balance at 31 December 2020
42,700,446
(8,852,411)
(282,918)
2,041,737
(20,289,999)
15,316,855
137,242
15,454,097
The accompanying notes form part of these financial statements.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
24
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 31 DECEMBER 2020
Group
Note
2020
$
2019
$
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Grants received
Net cash generated by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received
Purchase of property, plant and equipment
Purchase of intangible assets
Purchase of investments
Cash acquired from acquisition of subsidary
Loan to related parties:
- payments made
- proceeds from repayments
Net cash (used in)/generated by investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Payments for capital raising costs
Payments of lease liability
Net cash provided by (used in) financing activities
Net increase in cash held
Cash and cash equivalents at beginning of financial year
Effect of exchange rates on cash holdings in foreign currencies
21
2,797,374
(2,751,666)
428,978
474,686
56,054
(39,790)
(1,641,887)
-
-
-
(244,433)
43,007
(1,827,049)
13,586,096
(778,506)
(75,085)
12,732,505
11,380,142
414,229
31,857
Cash and cash equivalents at end of financial year
8
11,826,228
2,249,822
(3,274,883)
-
(1,025,061)
61,855
(31,271)
(139,476)
(145,023)
1,686
-
-
35,679
(216,550)
1,500,006
(128,882)
(72,291)
1,298,833
57,222
359,888
(2,881)
414,229
The accompanying notes form part of these financial statements.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
25
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
These consolidated financial statements and notes represent those of iCandy Interactive Limited and Controlled Entities ("group").
The financial statements were authorised for issue on 31 March 2021 by the directors of the company.
Note 1
Summary of Significant Accounting Policies
Basis of Preparation
These general purpose consolidated financial statements have been prepared in accordance with the Corporations Act 2001, Australian Accounting
Standards and Interpretations of the Australian Accounting Standards Board and in compliance with International Financial Reporting Standards as issued
by the International Accounting Standards Board. The Group is a for-profit entity for financial reporting purposes under Australian Accounting Standards.
Material accounting policies adopted in the preparation of these financial statements are presented below and have been consistently applied unless
stated otherwise.
Except for cash flow information, the financial statements have been prepared on an accrual 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.
(a)
Principles of Consolidation
iCandy Interactive Limited's financial statements consolidated those of the Parent Company and all of its subsidiaries as of 31 December 2020. The
Parent controls a subsidiary if it is exposed, or has rights, to variable returns from its involvement with the subsidiary and has the ability to affect
those returns through its power over the subsidiary. All subsidiaries have a reporting date of 31 December.
The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Group from the date on which control is
obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control ceases. Inter-company transactions, balances and
unrealised gains or losses on transactions between Group entities are fully eliminated on consolidation. Accounting policies of subsidiaries have
been changed and adjustments made where necessary to ensure uniformity of the accounting policies adopted by the Group.
Profit or loss and other comprehensive income of subsidiaries acquired or disposed of during the year are recognised from the effective date of
acquisition, or up to the effective date of disposal, as applicable.
Non-controlling interests, presented as part of equity, represent the portion of a subsidiary's profit or loss and net assets that is not held by the
Group. The Group attributes total comprehensive income or loss of subsidiaries between the owners of the parent and the non-controlling interests
based on their respective ownership interests.
Business Combinations
Business combinations occur where an acquirer obtains control over one or more businesses.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or businesses under
common control. The business combination will be accounted for from the date that control is obtained, whereby the fair value of the identifiable
assets acquired and liabilities (including contingent liabilities) assumed is recognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability resulting from a contingent consideration
arrangement is also included. Subsequent to initial recognition, contingent consideration classified as equity is not remeasured and its subsequent
settlement is accounted for within equity. Contingent consideration classified as an asset or liability is remeasured each reporting period to fair value,
recognising any change to fair value in profit or loss, unless the change in value can be identified as existing at acquisition date.
All transaction costs incurred in relation to business combinations, other than those associated with the issue of a financial instrument, are
recognised as expenses in profit or loss when incurred.
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase.
Goodwill
Goodwill is carried at cost less any accumulated impairment losses. Goodwill is calculated as the excess of the sum of:
(i) the consideration transferred at fair value;
(ii) any non-controlling interest (determined under either fair value or proportionate interest method); and
(iii) the acquisition date fair value of any previously held equity interest;
over the acquisition date fair value of any identifiable assets acquired and liabilities assumed.
The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair value of any previously held
equity interest shall form the cost of the investment in the separate financial statements.
Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as
equity transactions. The carrying amounts of the Group's interests and the non-controlling interests are adjusted to reflect the changes in their
relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the
consideration paid or received is recognised directly in equity and attributed to owners of the Group.
When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference between (i) the
aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets
(including goodwill), and liabilities of the subsidiary and any non-controlling interests. All amounts previously recognised in other comprehensive
income in relation to that subsidiary are accounted for as if the Group had directly disposed of the related assets or liabilities of the subsidiary (i.e.
reclassified to profit or loss or transferred to another category of equity as specified/permitted by applicable AASB Accounting Standards). The fair
value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for
subsequent accounting under AASB 9: Financial Instruments: Recognition and Measurement, when applicable, the cost on initial recognition of an
investment in an associate or a joint venture.
The amount of goodwill recognised on acquisition of each subsidiary in which the Group holds less than 100% interest will depend on the method
adopted in measuring the non-controlling interest. The Group can elect in most circumstances to measure the non-controlling interest in the acquiree
either at fair value (full goodwill method) or at the non-controlling interest's proportionate share of the subsidiary's identifiable net assets
(proportionate interest method). In such circumstances, the Group determines which method to adopt for each acquisition and this is stated in the
respective note to the financial statements disclosing the business combination.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
26
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
Under the full goodwill method, the fair value of the non-controlling interest is determined using valuation techniques which make the maximum use
of market information where available.
Goodwill on acquisitions of subsidiaries is included in intangible assets. Goodwill on acquisition of associates is included in investments in
associates.
Goodwill is tested for impairment annually and is allocated to the Group's cash-generating units or groups of cash-generating units, representing the
lowest level at which goodwill is monitored and not larger than an operating segment. Gains and losses on the disposal of an entity include the
carrying amount of goodwill related to the entity disposed of.
(b)
Income Tax
The income tax expense (income) for the year comprises current income tax expense (income) and deferred tax expense (income).
Current income tax expense charged to profit or loss is the tax payable on taxable income for the current period. Current tax liabilities (assets) are
measured at the amounts expected to be paid to (recovered from) the relevant taxation authority using tax rates (and tax laws) that have been
enacted or substantively enacted by the end of the reporting period.
Deferred 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 income tax expense (income) is charged or credited outside profit or loss when the tax relates to items that are recognised
outside profit or loss or arising from a business combination.
A deferred tax liability shall be recognised for all taxable temporary differences, except to the extent that the deferred tax liability arises from: (a) the
initial recognition of goodwill; or (b) the initial recognition of an asset or liability in a transaction which: (i) is not a business combination; and (ii) at the
time of the transaction, affects neither accounting profit nor taxable profit (tax loss).
Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset or liability, 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 and their measurement also reflects the manner in which management expects to recover or settle the carrying amount of the related asset or
liability. With respect to non-depreciable items of property, plant and equipment measured at fair value and items of investment property measured at
fair value, the related deferred tax liability or deferred tax asset is measured on the basis that the carrying amount of the asset will be recovered
entirely through sale. When an investment property that is depreciable is held by the entity in a business model whose objective is to consume
substantially all of the economic benefits embodied in the property through use over time (rather than through sale), the related deferred tax liability
or deferred tax asset is measured on the basis that the carrying amount of such property will be recovered entirely through use.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that is probably 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 tax assets and liabilities are offset where a legally enforceable right of set-off exists and it is intended that net settlement or simultaneous
realisation and settlement of the respective asset and liability will occur. Deferred tax assets and liabilities are offset where: (i) a legally enforceable
right of set-off exists; and (ii) 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.
(c)
Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis, depending on the requirements of the
applicable accounting standard.
Fair value is the price the Group would receive to sell an asset or would have to pay to transfer a liability in an orderly (i.e. unforced) transaction
between independent, knowledgeable and willing market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine fair value. Adjustments
to market values may be made having regard to the characteristics of the specific asset or liability. The fair values of assets and liabilities that are
not traded in an active market are determined using one or more valuation techniques. These valuation techniques maximise, to the extent possible,
the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or liability (i.e. the market with the greatest
volume and level of activity for the asset or liability) or, in the absence of such a market, the most advantageous market available to the entity at the
end of the reporting period (i.e. the market that maximises the receipts from the sale of the asset or minimises the payments made to transfer the
liability, after taking into account transaction costs and transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use the asset in its highest and best use
or to sell it to another market participant that would use the asset in its highest and best use.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-based payment arrangements) may be valued,
where there is no observable market price in relation to the transfer of such financial instruments, by reference to observable market information
where such instruments are held as assets. Where this information is not available, other valuation techniques are adopted and, where significant,
are detailed in the respective note to the financial statements.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
27
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
(d)
Digital Currencies
Digital currencies are indefinite life intangible assets initially recognised at cost. The digital currencies are subsequently measured at fair value by
reference to the quote price in an active digital currency market.
Any increases or decreases in the fair value of the digital currencies are recognised through the profit and loss, similar to any gains or losses upon
the disposals of digital currencies.
(e)
Accounting for Common Control
Where the acquisition of entities that are deemed to be under common control occurs then consideration is required to determine the accounting
acquirer. A new entity formed to effect a business combination through the issue of equity interests will not be regarded as the accounting acquirer,
rather one of the combining entities that existed prior to the business combination shall be identified as the accounting acquirer.
The pooling of interests method is adopted for business combinations under common control. Existing book values for assets and liabilities at the
date of acquisition will be recognised and fair value adjustments including new intangibles or goodwill will not be recognised. Any premium between
the fair value of consideration paid and the book value of net assets is debited to a separate category of equity.
(f)
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.
Property
Freehold land and buildings are carried at their fair value (being the amount for which an asset could be exchanged between knowledgeable willing
parties in an arm's length transaction), based on periodic, but at least triennial, valuations by external independent valuers, less accumulated
impairment losses and accumulated depreciation for buildings.
Increases in the carrying amount arising on revaluation of land and buildings are credited to a revaluation surplus in equity. Decreases that offset
previous increases of the same asset are recognised against revaluation surplus directly in equity; all other decreases are recognised in profit or
loss.
Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated
to the revalued amount of the asset.
Plant and equipment
Plant and equipment are measured on the cost basis and therefore carried at cost less accumulated depreciation and any accumulated impairment.
In the event the carrying amount of plant and equipment is greater than the estimated recoverable amount, the carrying amount is written down
immediately to the estimated recoverable amount and impairment losses are recognised either in profit or loss. A formal assessment of recoverable
amount is made when impairment indicators are present (refer to Note 1(i) for details of impairment).
The carrying amount of plant and equipment is reviewed annually by directors to ensure it is not in excess of the recoverable amount from these
assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the asset's employment and
subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.
The cost of fixed assets constructed within the consolidated group includes the cost of materials, direct labour, borrowing costs and an appropriate
proportion of fixed and variable overheads.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future
economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and
maintenance are recognised as expenses in profit or loss during the financial period in which they are incurred.
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 Group commencing from the time the asset is held ready for use. Leasehold improvements are
depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable assets are:
Class of Fixed Asset
Leasehold improvements
Plant and equipment
Signages
Depreciation Rate
10-25%
10-25%
10-25%
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 recognised in profit or
loss in the period in which they arise. Gains shall not be classified as revenue. When revalued assets are sold, amounts included in the revaluation
surplus relating to that asset are transferred to retained earnings.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
28
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
(g)
Leases (the Group as lessee)
The Group as lessee
At inception of a contract, the Group assesses if the contract contains or is a lease. If there is a lease present, a right-of-use asset and a
corresponding lease liability is recognised by the Group where the Group is a lessee. However, all contracts that are classified as short-term leases
(lease with remaining lease term of 12 months or less) and leases of low- value assets are recognised as an operating expense on a straight-line
basis over the term of the lease.
Initially, the lease liability is measured at the present value of the lease payments still to be paid at commencement date. The lease payments are
discounted at the interest rate implicit in the lease. If this rate cannot be readily determined, the Group uses the incremental borrowing rate.
Lease payments included in the measurement of the lease liability are as follows:
– fixed lease payments less any lease incentives;
– variable lease payments that depend on an index or rate, initially measured using the index or rate at the commencement date;
– the amount expected to be payable by the lessee under residual value guarantees;
– the exercise price of purchase options, if the lessee is reasonably certain to exercise the options;
– lease payments under extension options, if lessee is reasonably certain to exercise the options; and
– payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.
The right-of-use assets comprise the initial measurement of the corresponding lease liability as mentioned above, any lease payments made at or
before the commencement date, as well as any initial direct costs. The subsequent measurement of the right-of-use assets is at cost less
accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or useful life of the underlying asset, whichever is the shortest.
Where a lease transfers ownership of the underlying asset, or the cost of the right-of-use asset reflects that the Group anticipates to exercise a
purchase option, the specific asset is depreciated over the useful life of the underlying asset.
(h)
Financial Instruments
Recognition and Initial Measurement
Financial assets and financial liabilities are recognised when the Group becomes a party to the contractual provisions to the instrument. For financial
assets, this is the date that the Group commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments (except for trade receivables) are initially measured at fair value plus transactions costs except where the instrument is
classified ‘at fair value through profit or loss’ in which case transaction costs are expensed to profit or loss immediately. Where available, quoted
prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted.
Classification and Subsequent Measurement
Financial instruments are subsequently measured at:
—
—
amortised cost; or
fair value through profit or loss.
A financial liability is measured at fair value through profit and loss if the financial liability is:
Amortised cost is calculated as the amount at which the financial asset or financial liability is measured at initial recognition less principal repayments
and any reduction for impairment, and adjusted for any cumulative amortisation of the difference between that initial amount and the maturity amount
calculated using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest expense in profit or loss
over the relevant period. The effective interest rate is the internal rate of return of the financial asset or liability. That is, it is the rate that exactly
discounts the estimated future cash flows through the expected life of the instrument to the net carrying amount at initial recognition.
The Group does not designate any interests in subsidiaries, associates or joint ventures as being subject to the requirements of Accounting
Standards specifically applicable to financial instruments.
(i) Financial assets at fair value through profit or loss
Financial assets are classified at 'fair value through profit or loss" when they are held for trading for the purpose of short-term profit taking,
derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance
evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented
risk management or investment strategy. Such assets are subsequently measured at fair value with changes in carrying amount included in
profit or loss.
(ii) Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are
subsequently measured at amortised cost.
Gains or losses are recognised in profit or loss through the amortisation process and when the financial asset is derecognised.
(iii) Financial Liabilities
Non-derivative financial liabilities other than financial guarantees are subsequently measured at amortised cost. Gains or losses are recognised
in profit or loss through the amortisation process and when the financial liability is derecognised.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
29
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
Impairment
A financial asset (or a group of financial assets) is deemed to be impaired if, and only if, there is objective evidence of impairment as a result of one
or more events (a "loss" event) having occurred, which has an impact on the estimated future cash flows of the financial asset(s).
In the case of available-for-sale financial assets, a significant or prolonged decline in the market value of the instrument is considered to constitute a
loss event. Impairment losses are recognised in profit or loss immediately. Also, any cumulative decline in fair value previously recognised in other
comprehensive income is reclassified intro profit or loss at this point.
In the case of financial assets carried at amortised cost, loss events may include: indications that the debtors or a group of debtors are experiencing
significant financial difficulty, default or delinquency in interest or principal payments; indications that they will enter bankruptcy or other financial
reorganisation; and changes in arrears or economic conditions that correlate with defaults.
For financial assets carried at amortised cost (including loans and receivables), a separate allowance account is used to reduce the carrying amount
of financial assets impaired by credit losses. After having taken all possible measures of recovery, if management establishes that the carrying
amount cannot be recovered by any means, at that point the written-off amounts are charged to the allowance account or the carrying amount of
impaired financial assets is reduced directly if no impairment amount was previously recognised in the allowance account.
When the terms of financial assets that would otherwise have been past due or impaired have been renegotiated, the Group recognises the
impairment for such financial assets by taking into account the original terms as if the terms have not been renegotiated so that the loss events that
have occurred are duly considered.
(i)
Impairment of Assets
At the end of each reporting period, the company 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 joint ventures
deemed to be out of pre-acquisition profits. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable
amount of the asset, being the higher of the asset’s fair value less costs of disposal and value in use, to the asset’s carrying amount. Any excess of
the asset’s carrying amount over its recoverable amount is recognised immediately in profit or loss, unless the asset is carried at a revalued amount
in accordance with another Standard (e.g. in accordance with the revaluation model in AASB 116: Property, Plant and Equipment ). Any impairment
loss of a revalued asset is treated as a revaluation decrease in accordance with that other Standard.
Where it is not possible to estimate the recoverable amount of an individual asset, the entity estimates the recoverable amount of the cash-
generating unit to which the asset belongs.
Impairment testing is performed annually for goodwill, intangible assets with indefinite lives and intangible assets not yet available for use.
When an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the revised estimate of
its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in
profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation
increase.
(j)
Investments in Associates
An associate is an entity over which the company has significant influence. Significant influence is the power to participate in the financial and
operating policy decisions of the entity but is not control or joint control of those policies. Investments in associates are accounted for in the financial
statements by applying the equity method of accounting, whereby the investment is initially recognised at cost (including transaction costs) and
adjusted thereafter for the post-acquisition change in the company’s share of net assets of the associate. In addition, the Company’s share of the
profit or loss and other comprehensive income is included in the financial statements.
The carrying amount of the investment includes, when applicable, goodwill relating to the associate. Any discount on acquisition, whereby the
Company’s share of the net fair value of the associate exceeds the cost of investment, is recognised in profit or loss in the period in which the
investment is acquired.
Profits and losses resulting from transactions between the Company and the associate are eliminated to the extent of the Company’s interest in the
associate.
When the Company’s share of losses in an associate equals or exceeds its interest in the associate, the Company discontinues recognising its share
of further losses unless it has incurred legal or constructive obligations or made payments on behalf of the associate. When the associate
subsequently makes profits, the Company will resume recognising its share of those profits once its share of the profits equals the share of the
losses not recognised.
The requirements of AASB 128: Investments in Associates and Joint Ventures and AASB 9: Financial Instruments are applied to determine whether
it is necessary to recognise any impairment loss with respect to the Group’s investment in an associate or a joint venture. When necessary, the
entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with AASB 136: Impairment of Assets as a single
asset by comparing its recoverable amount (higher of value in use and fair value less costs of disposal) with its carrying amount. Any impairment loss
recognised forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognised in accordance with AASB 136 to
the extent that the recoverable amount of the investment subsequently increases.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
30
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
(k)
Interests in Joint Arrangements
Joint arrangements represent the contractual sharing of control between parties in a business venture where unanimous decisions about relevant
activities are required.
Separate joint venture entities providing joint venturers with an interest to net assets are classified as a joint venture and accounted for using the
equity method.
Joint operations represent arrangements whereby joint operators maintain direct interests in each asset and exposure to each liability of the
arrangement. The company’s interests in the assets, liabilities, revenue and expenses of joint operations are included in the respective line items of
the financial statements.
Gains and losses resulting from sales to a joint operation are recognised to the extent of the other parties’ interests. When the Company makes
purchases from a joint operation, it does not recognise its share of the gains and losses from the joint arrangement until it resells those goods/assets
to a third party.
(l)
Intangible Assets Other than Goodwill
Computer software
Computer software is recorded at cost. Where software is acquired at no cost, or for a nominal cost, the cost is its fair value, as at the date of
acquisition. It has a finite life and is carried at cost less accumulated amortisation and any impairment losses. Software has an estimated useful life
of between one and ten years. It is assessed annually for impairment.
Research and Development
Research and development is recorded at cost. It has a finite life and is carried at cost less accumulated amortisation and any impairment losses.
Research and development has an estimated useful life of three years. It is assessed annually for impairment.
Games Portfolio
Games Portfolio are externally acquired games that are recorded at cost. It has a finite life and is carried at cost less accumulated amortisation and
any impairment losses. The Games Portfolio has an estimated useful life of five years. It is assessed annually for impairment.
(m)
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of the Company is the currency of the primary economic environment in which that entity operates. The financial statements
are presented in Australian dollars, which is the Company’s functional currency.
Transaction and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transaction. Foreign
currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the
exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
Exchange differences arising on the translation of monetary items are recognised in profit or loss, except exchange differences that arise from net
investment hedges.
Exchange differences arising on the translation of non-monetary items are recognised directly in other comprehensive income to the extent that the
underlying gain or loss is recognised in other comprehensive income, otherwise the exchange difference is recognised in the profit or loss.
The Company
The financial results and position of foreign operations whose functional currency is different from the entity’s presentation currency are translated as
follows:
—
—
—
assets and liabilities are translated at exchange rates prevailing at the end of the reporting period;
income and expenses are translated at exchange rates on the date of transaction; and
all resulting exchange differences are recognised in other comprehensive income.
Exchange differences arising on translation of foreign operations with functional currencies other than Australian dollars are recognised in other
comprehensive income and included in the foreign currency translation reserve in the statement of financial position and allocated to non-controlling
interest where relevant. The cumulative amount of these differences is reclassified into profit or loss in the period in which the operation is disposed
of.
(n)
Employee Benefits
Short-term employee benefits
Provision is made for the Company’s obligation for short-term employee benefits. Short-term employee benefits are benefits (other than termination
benefits) that are expected to be settled wholly before twelve months after the end of the annual reporting period in which the employees render the
related service, including wages, salaries and sick leave. Short-term employee benefits are measured at the (undiscounted) amounts expected to be
paid when the obligation is settled.
The company’s obligations for short-term employee benefits such as wages, salaries and sick leave are recognised as part of current trade and other
payables in the statement of financial position. The company’s obligations for employees’ annual leave and long service leave entitlements are
recognised as provisions in the statement of financial position.
Other long-term employee benefits
Provision is made for employees’ long service leave and annual leave entitlements not expected to be settled wholly within 12 months after the end
of the annual reporting period in which the employees render the related service. Other long-term employee benefits are measured at the present
value of the expected future payments to be made to employees.
The company’s obligations for short-term employee benefits such as wages, salaries and sick leave are recognised as part of current trade and other
payables in the statement of financial position. The company’s obligations for employees’ annual leave and long service leave entitlements are
recognised as provisions in the statement of financial position.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
31
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
(o)
Provisions
Provisions are recognised when the Group 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.
Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period.
(p)
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and deposits available on demand with banks. Bank overdrafts are reporting within short-term
borrowings in current liabilities in the statement of financial position.
(q)
Revenue and Other Income
Accounting policy for revenue recognition
Revenue is recognised and measure at the fair value of the consideration received or receivable to the extent it is probable that the economic
benefits will flow to the Company and the revenue can be reliably measured. Revenue is recognised with reference to the completion by the
Company of specific performance obligations of contracts with customers, as described below.
Revenue from contracts with customers
Revenue is recognised on the purchase of mobile gaming applications and licencing services to customers in an amount that reflects the
consideration to which the Company expects to be entitled in exchange for those goods or services.
All contracts with effect from 1 January 2018 (either written, verbal or implied) are identified, together with the separate performance obligations
within the contract and the transaction price is determined. Adjustments are made for the time value of money excluding credit risk and the
transaction price is allocated to the separate performance obligations on a basis of relative stand-alone selling price of each distinct good/service.
The estimation approach is taken if no distinct observable prices exists and revenue is recognised when each performance obligation is satisfied.
Credit risk is presented separately as an expense, rather than adjusted to revenue. For goods, the performance obligation is satisfied when the
customer takes control of the goods. For services, the performance obligation is satisfied when the service has been performed, typically for
promises to transfer services to customers. For performance obligations satisfied over time, the Company selects an appropriate measure of
progress to determine how much revenue is recognised as the performance obligation is satisfied.
Mobile game applications revenue
Revenue from mobile game application sales are recognised at the time of the game application purchase.
Publishing revenue
The Company receives revenue for publishing income in relation to mobile game applications. The publishing revenue is recognised at the time the
service is provided.
Interest
Interest revenue is recognised using the effective interest method.
All revenue is stated net of the amount of goods and services tax.
(r)
Trade and Other Receivables
Trade and other receivables include amounts due from customers for goods sold and services performed in the ordinary course of business.
Receivables expected to be collected within 12 months of the end of the reporting period are classified as current assets. All other receivables are
classified as non-current assets.
Trade and other receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective interest method,
less any provision for impairment. Refer to Note 1(i) for further discussion on the determination of impairment losses.
(s)
Trade and Other Payables
Trade and other payables represent the liabilities for goods and services received by the entity that remain unpaid at the end of the reporting period.
The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability.
(t)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the
Australian Taxation Office (ATO).
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to,
the ATO is included with other receivables or payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable
from, or payable to, the ATO are presented as operating cash flows included in receipts from customers or payments to suppliers.
(u)
Government Grants
Government grants are recognised at fair value where there is reasonable assurance that the grant will be received and all grant conditions will be
met. Grants relating to expense items are recognised as income over the periods necessary to match the grant to the costs it is compensating.
Grants relating to assets are credited to deferred income at fair value and are credited to income over the expected useful life of the asset on a
straight-line basis.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
32
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note1: Summary of Significant Accounting Policies (continued)
(v)
Comparative Figures
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial
year.
Where the company retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies items in its financial statements,
an additional (third) statement of financial position as at the beginning of the preceding period in addition to the minimum comparative financial
statements is presented.
(w)
Critical Accounting Estimates and Judgements
The directors evaluate estimates and judgements 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.
(i) Key judgements and estimates - Intellectual Property - Research and Development
In determining the development expenditures to be capitalised, the Group makes estimates and assumptions based on expected future
economic benefits generated by products that are the result of those development expenditures. Other important estimates and assumptions in
this assessment process are the distinction between R&D and the estimated useful life.
Development costs associated with intangible assets are only capitalised by the Group when it can demonstrate the technical feasibility of
completing the asset so that the asset will be available for use or sale, how the asset will generate future economic benefits and the ability to
measure reliably the expenditure attributable to the intangible asset during its development.
Development costs in respect to software are internally generated, and have a finite useful life. The amortisation method is line over the period
of the expected benefit, being 3 years. Impairment testing is undertaken when impairment indicators exist.
(ii) Key Estimate - Taxation
Refer to Note 4 - Income Tax
(iii) Key judgements and estimates - Impairment
The Group assess impairment at each reporting date by evaluating conditions specific to the Group that may lead to impairment of assets.
Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in-use calculations performed in assessing
recoverable amounts incorporate a number of key estimates. There is also judgement applied in determining recoverability of asset.
(v) Key judgements and estimates - Share-based payments
The Group 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 by an internal valuation using a Black-Scholes option pricing model, using the assumptions
detailed in Note 22 - Share-based payments.
Note 2
Parent Information
The following information has been extracted from the books and records of the financial information of the parent entity set out below and has been
prepared in accordance with Australian Accounting Standards.
STATEMENT OF FINANCIAL POSITION
ASSETS
Current Assets
Non-current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Non-current Liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued Capital
Retained earnings
Reserves
TOTAL EQUITY
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Loss for the year
Other comprehensive income for the year
Total comprehensive income
2020
$
2019
$
12,217,641
2,897,604
233,955
2,712,931
15,115,245
2,946,886
903,944
-
903,944
848,877
-
848,877
14,211,301
2,098,009
42,700,446
(30,530,882)
2,041,737
30,306,206
(29,207,787)
999,590
14,211,301
2,098,009
(1,323,094)
-
(1,323,094)
(2,514,634)
-
(2,514,634)
On consolidation of the Group, iCandy Interactive Limited's investment cost in Appxplore (iCandy) Limited - formerly known as iCandy Ventures Limited
($15,000,000) and iCandy Digital Pte Ltd ($5,000,000) has been allocated to equity. Refer to Note 27(b) for a detailed explanation on the adoption of this
accounting policy.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
33
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 3
Revenue and Other Income
The Group has recognised the following amounts relating to revenue in the statement of profit or loss.
(a) Revenue from continuing operations
Sales revenue
-
sale of in-app applications
- ads and sponsorships
- publishing income
-
services
(b) Other income
-
interest received
- unrealised foreign exchange gin/(loss)
- other income
Note 4
Income tax expense
(a)
The components of tax (expense) income comprise:
Current tax
Deferred tax
(b)
The prima facie tax on profit from ordinary activities before income tax is
reconciled to income tax as follows:
Prima Facie tax payable on profit from ordinary activities before income tax at
27.5% (2019: 27.5%)
—
consolidated group
Add:
Tax effect of:
—
—
—
current year tax loss not brought into account
income tax payable by foreign subsidiary
write back of deferred tax liabilities brought into account
Income tax attributable to entity
(c) Deferred tax assets not brought into account
Group
2020
$
2019
$
1,970,126
1,235,559
506,109
710,231
406,389
568,948
85,694
347,029
3,592,855
2,237,230
56,054
-
454,627
510,681
61,855
(21,368)
207,193
247,680
Group
2020
$
2019
$
Note
(2,224)
-
(2,224)
(11,849)
879
(10,970)
(12,113)
(635,818)
12,113
2,224
-
2,224
635,818
12,699
(1,729)
10,970
Deferred tax assets not brought to account, the benefits of which will only be realised if it is probable that taxable profit will be available against which
the unutilised tax losses can be utilised.
Temporary differences
Tax Losses:
—
Operating losses
(d) Deferred tax liabilities
Deferred tax liabilities brought into account by foreign subsidiary
1,636,994
1,722,865
3,342
3,342
7,937
7,937
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
34
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 5
Key Management Personnel Compensation
Refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or payable to each member of the Group’s key
management personnel (KMP) for the year ended 31 December 2020.
The totals of remuneration paid to KMP of the company and the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Total KMP compensation
Short-term employee benefits
2020
$
181,308
-
181,308
2019
$
117,809
-
117,809
These amounts include fees and benefits paid to the non-executive chair and non-executive directors as well as all salary, paid leave benefits, fringe
benefits and cash bonuses awarded to executive directors and other key management personnel.
Post-employment benefits
These amounts are the current year’s estimated costs of providing for the Group's defined benefits scheme post-retirement, superannuation
contributions made during the year and post-employment life insurance benefits.
Note 6
Auditor’s Remuneration
Remuneration of the auditor for:
—
—
auditing or reviewing the financial statements
auditing or reviewing the financial statements of subsidiaries
Note 7
Earnings per Share
(a)
Reconciliation of earnings to profit or loss
Loss
Earnings used in the calculation of basic and dilutive EPS
(b)
Weighted average number of ordinary shares outstanding during the year used in
calculating basic EPS
Weighted average number of ordinary shares outstanding during the year used in
calculating dilutive EPS
Note 8
Cash and Cash Equivalents
Cash at bank and on hand
Reconciliation of cash
Cash and cash equivalents at the end of the financial year as shown in
the statement of cash flows is reconciled to items in the statement of
financial position as follows:
Cash and cash equivalents
Group
2020
$
2019
$
41,069
9,015
50,084
53,224
3,456
56,680
Group
2020
$
2019
$
(302,312)
(2,223,264)
(302,312)
(2,223,264)
No.
No.
385,754,017
327,634,307
385,754,017
327,634,307
Group
2020
$
2019
$
11,826,228
11,826,228
414,229
414,229
11,826,228
11,826,228
414,229
414,229
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
35
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 9
Trade and Other Receivables
CURRENT
Trade receivables
Provision for impairment
Other receivables
GST receivables
Total current trade and other receivables
Note
Group
2020
$
2019
$
1,290,045
(4,193)
1,285,852
72,720
96,406
194,154
(4,527)
189,627
158,418
4,468
1,454,978
352,513
The Group applies the simplified approach to providing for expected credit losses prescribed by AASB 9, which permits the use of the lifetime expected
loss provision 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 loss allowance provision as at 31 December 2020 is determined as follows; the expected credit losses also
incorporate forward-looking information.
The "amounts written off" are all due to customers declaring bankruptcy, or term receivables that have now become unrecoverable.
2020
Expected loss rate
Gross carrying amount
Loss allowing provision
2019
Expected loss rate
Gross carrying amount
Loss allowing provision
Credit risk
Current
>30 days past
due
>60 days past
due
>90 days past
due
Total
$
$
$
$
$
0.33%
1,290,045
(4,193)
1.27%
357,040
(4,527)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,290,045
(4,193)
357,040
(4,527)
The Group has no significant concentration of credit risk with respect to any single counter party or group of counter parties other than those receivables
specifically provided for and mentioned within Note 9. The class of assets described as Trade and Other Receivables is considered to be the main source
of credit risk related to the Group.
On a geographic basis, the Group has significant credit risk exposures in Malaysia given the substantial operations in that region. The Group's exposure
to credit risk for receivables at the end of the reporting period in those regions are as follows:
AUD
Australia
Singapore
Malaysia
Indonesia
Group
2020
$
770,950
937
664,802
18,289
2019
$
4,559
746
343,650
3,558
1,454,978
352,513
The Group always measures the loss allowance for trade receivables at an amount equal to lifetime expected credit loss. The expected credit losses on
trade receivables are estimated using a provision matrix by reference to past default experience of the debtor and an analysis of the debtor's current
financial position, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate and an
assessment of both the current as well as the forecast direction of conditions at the reporting date.
There has been no change in the estimation techniques or significant assumptions made during the current reporting period.
The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty and there is no realistic prospect
of recovery, e.g. when the debtor has been placed under liquidation or has entered into bankruptcy proceedings, or when the trade receivables are over
two years past due, whichever occurs earlier. None of the trade receivables that have been written off is subject to enforcement activities.
(a) Collateral Held as Security
No collateral was held as security at balance date or date the date of this report.
(b) Financial Assets Measured at Amortised Cost
Trade and other Receivables
— Total current
— Total non-current
Total financial assets measured at amortised cost
Group
2020
$
2019
$
1,454,978
-
1,454,978
352,513
-
352,513
Note
25
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
36
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 10
Other Financial Assets
CURRENT
Amount receivable from:
- other related parties
- others
Convertible notes
Total current assets
Total Other Financial Assets
Current
Non-Current
Terms of Receivables:
All receivables are at call.
There are no securities attached.
Group
2020
$
2019
$
1,182,832
1,008
1,183,840
64,918
1,248,758
1,317,286
23,383
1,340,669
74,667
1,415,336
1,248,758
-
1,248,758
1,415,336
-
1,415,336
Amount receivables of $1,170,962 (SGD 1,193,094) has an interest rate of 5% per annum attached.
Note 11
Interests in Subsidiaries
(a)
Information about Principal Subsidiaries
The subsidiaries listed below have share capital consisting solely of ordinary shares or ordinary units which are held directly by the Group. The
proportion of ownership interests held equals the voting rights held by Group.
Name of subsidiary
Place of Incorporation
iCandy Digital Pte Ltd
Appxplore (iCandy) Limited
Appxplore (iCandy) Sdn Bhd
Inzen (iCandy) Pte Ltd
iCandy Play Limited
iCandy Games Limited
PT Joyseed Berhagi Sukses
Beetleroar Sdn Bhd*
Singapore
British Virgin Island
Malaysia
Singapore
British Virgin Island
British Virgin Island
Indonesia
Malaysia
Ownership interest held by
the Group
Proportion of non-controlling
interests
2020
(%)
100%
100%
100%
100%
100%
100%
67%
40%
2019
(%)
100%
100%
100%
100%
100%
100%
67%
40%
2020
(%)
2019
(%)
-
-
-
-
-
-
-
-
-
-
-
-
33%
60%
33%
60%
Subsidiary financial statements used in the preparation of these consolidated financial statements have also been prepared as at the same reporting
date as the Group’s financial statements.
*Beetleroar Sdn Bhd has been deemed a subsidiary as it’s the remainding 60% of shareholders are the Chief Operating Officer and Creative Director
of Appxplore (iCandy) Sdn Bhd, a wholly owned subsidiary of the Company. Therefore, the Company is deemed to have control.
(b) Significant Restrictions
There are no significant restrictions over the Group's ability to access or use assets and settle liabilities of the Group.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
37
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 12
Property, Plant and Equipment
PLANT AND EQUIPMENT
Plant and equipment:
At cost
Accumulated depreciation
Leasehold improvements
At cost
Accumulated amortisation
Signage
At cost
Accumulated amortisation
Total plant and equipment
Group
2020
$
2019
$
189,984
(102,846)
87,138
65,769
(41,319)
24,450
1,651
(721)
930
171,725
(79,986)
91,739
64,095
(32,741)
31,354
1,779
(599)
1,180
112,518
124,273
(a)
Movements in Carrying Amounts
Movements in carrying amounts for each class of plant and equipment between the beginning and the end of the current financial year.
Consolidated Group:
Balance at 1 January 2019
Additions
Additions through acquisition of entity
Depreciation expense
Foreign exchange movement
Balance at 31 December 2019
Additions
Depreciation expense
Foreign exchange movement
Balance at 31 December 2020
Plant and
Equipment
$
Leasehold
Improvements
$
Signage
Total
$
$
71,699
31,271
10,419
(24,674)
3,024
91,739
31,041
(30,652)
(4,990)
87,138
42,185
1,333
115,217
-
-
(11,627)
796
31,354
6,289
(11,653)
(1,540)
24,450
-
-
(178)
25
31,271
10,419
(36,479)
3,845
1,180
124,273
-
(176)
(74)
930
37,330
(42,481)
(6,604)
112,518
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
38
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 13
Intangible Assets
Goodwill
Cost
Accumulated impairment losses
Net carrying amount
Games Portfolio
Cost
Accumulated amortisation and impairment losses
Net carrying amount
Computer software:
Cost
Accumulated amortisation and impairment losses
Net carrying amount
Research and development
Cost
Accumulated amortisation and impairment losses
Net carrying amount
Cryptocurrency
Cost
Accumulated amortisation and impairment losses
Net carrying amount
Total intangible assets
Consolidated Group:
Year ended 31 December 2019
Balance at the beginning of the year
Reclassification from prepayments
Additions
Amortisation charge
Impairment losses
Movement in fair value
Movement in foreign currency
Year ended 31 December 2020
Group
2020
$
2019
$
283,862
(283,862)
-
283,862
-
283,862
2,600,000
(2,370,000)
230,000
2,600,000
(1,850,000)
750,000
2,817,518
(1,585,003)
1,232,515
1,980,833
(1,404,483)
576,350
1,380,989
(294,078)
1,086,911
258,224
(183,803)
74,421
128,043
-
128,043
1,200,673
(1,138,271)
62,402
2,677,469
1,747,035
Goodwill
$
Games
Portfolio
$
Computer
Software
Research and
Development
Cryptocurrency
Total
$
$
$
$
-
-
283,862
-
-
-
-
-
-
(520,000)
(180,000)
-
-
283,862
750,000
1,450,000
952,534
145,803
83,955
2,632,292
-
-
-
-
-
63,560
(396,167)
(74,419)
-
-
-
-
19,983
576,350
3,037
74,421
576,350
982,687
-
74,421
1,141,797
-
-
-
(520,000)
(304,096)
(132,564)
-
-
-
-
-
-
-
(22,426)
3,257
-
347,422
(990,586)
(180,000)
(85,766)
23,673
-
-
(85,766)
653
62,402
1,747,035
62,402
10,941
(65,366)
-
-
134,522
(14,456)
1,747,035
2,135,425
(65,366)
(956,660)
(283,862)
134,522
(33,625)
Balance at the beginning of the year
283,862
750,000
Additions
Disposals
Amortisation charge
Impairment losses*
Movement in fair value
Movement in foreign currency
Closing value at 31 December 2020
-
-
-
(283,862)
-
-
-
230,000
1,232,515
1,086,911
128,043
2,677,469
*During the financial year, the Company assessed the recoverability regarding goodwill of PT Joyseed Berhagi Sukses acquisition. This resulted in the an
impairment charge of $283,862 being recognised during the year.
Intangible assets, other than goodwill, have finite useful lives. The current amortisation charges for intangible assets are included under depreciation and
amortisation expense per the statement of profit or loss.
Cryptocurrencies are valued at fair value at reporting date. Management has selected the coinmarketcap exchange as its exchange to gather information
on determining the fair value of the cryptocurrency.
*During the financial year, the Company assessed the recoverability regarding goodwill of Joyseed acquisition qhich resulted in the impairment being
recognised during the year.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
39
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 14
Other Assets
CURRENT
Prepayments
Deposits paid
Total Other Assets
Current
Non-Current
Note 15
Associates
Set out below are the associates of the Group.
Name
Classification
Group
2020
$
2019
$
202,584
25,840
228,424
228,424
-
228,424
70,817
-
70,817
70,817
-
70,817
Place of
business/
incorporation
Proportion of ordinary share
interests/participating share
Measurement
Method
Carrying amount
2020
%
2019
%
2020
$
2019
$
Esports.com Pte Ltd
Associate
Singapore
22.90%
42.55%
Equity
-
22,806
Esports.com Pte Ltd was co-founded with a consortium of partners in October 2019 to launch a global esports venture, named Esports Pro League
("ESPL").
ESPL is a global esports tournament and media network that will be developing an integrated and open ecosystem for tournaments, media, brands,
publishers, teams and players with a focus on community and digital interactivity.
Esports.com Pte Ltd is a private company and therefore, no quoted market prices are available for their shares.
(a)
Summarised financial information for associates
Set out below is the summarised financial information for Esports.com Pte Ltd. The disclosed information reflects the amounts presented in the
Australian Accounting Standards financial statements of the associates including adjustments made by the Group when applying the equity
method and adjustments for any differences in accounting policies between the Group and the associates.
Summarised financial position
Total current assets
Total non-current assets
Total current liabilities
Total non-current liabilities
Net assets
Group's share (%)
Group's share of associates net assets
Summarised financial performance
Revenue
Loss after tax
Other comprehensive income
Total comprehensive income
Group's share (%)
Group's share of associates comprehensive income
Reconciliation to carrying amount
Group's share of associates' opening net assets
Investments during the period
Group's share of net loss after tax
Share of losses not recognised
Foreign exchange movement
Esports.com Pte Ltd
2020
2019
$
$
353,191
8,802
(414,185)
(482,780)
(534,972)
22.90%
(122,509)
75,031
-
(21,432)
-
53,599
42.55%
22,806
Esports.com Pte Ltd
2020
2019
$
$
325,454
(1,110,995)
-
-
(194,490)
-
(785,541)
(194,490)
22.90%
(179,890)
42.55%
(82,756)
Esports.com Pte Ltd
2020
2019
$
$
22,806
-
(179,890)
157,274
(190)
-
-
105,955
(82,756)
-
(393)
22,806
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
40
For personal use only
ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 16
Trade and Other Payables
CURRENT
Unsecured liabilities
Trade payables
Sundry payables and accrued expenses
(a) Financial liabilities at amortised cost classified as trade and other payables
Trade and other payables
— Total current
— Total non-current
Financial liabilities as trade and other payables
Note 17
Other Financial Liabilities
CURRENT
Amounts payable to:
- other related parties
Total Other Financial Liabilities
- Current
- Non-Current
Terms of payables:
All payables are at call.
There are no securities attached.
No interest is payable on amounts owing.
Note 18
Leases
Note
Group
2020
$
2019
$
266,979
1,342,181
104,664
904,807
1,609,160
1,009,471
Group
2020
$
2019
$
1,609,160
-
1,609,160
1,009,471
-
1,009,471
25
Group
2020
$
2019
$
480,790
480,790
742,905
742,905
480,790
-
480,790
742,905
-
742,905
The Company has a property lease in place. During the year, the Company extended the lease for a further 3 years.
(a)
Right of use assets
Current
Right-of-use
Accumulated depreciation
Movement in carrying amounts:
Opening Balance as at 1 January
Recognised on initial aplication of AASB 16
Additions
Depreciation
Foreign currecny exchange movement
Closing Balance as at 31 December
Group
2020
$
2019
$
-
-
327,369
(126,390)
200,979
116,509
(66,577)
49,933
49,933
-
-
116,509
219,250
(68,844)
640
200,979
-
(66,292)
(284)
49,933
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
41
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 18: Leases (continued)
(b)
Lease Liabilities
Current
Non current
Movement in carrying amounts:
Opening Balance as at 1 January
Recognised on initial aplication of AASB 16
Additions
Lease payments
Interest expense
Foreign currecny exchange movement
Closing Balance as at 31 December
Office space
(c)
Cash outflows for leases
Cashflows from financing activities
Payments for rental leases
Note 19
Issued Capital
547,313,849 fully paid ordinary shares (2019: 337,190,644 fully paid ordinary shares)
The Group has authorised share capital amounting to 547,313,849 ordinary shares.
88,173
113,792
201,965
53,219
-
53,219
53,219
-
-
120,535
201,965
(56,160)
1,768
1,173
201,965
200,979
200,979
-
(73,030)
6,001
(287)
53,219
49,333
49,333
(75,085)
(75,085)
(72,291)
(72,291)
Group
2020
$
2019
$
42,700,446
30,306,207
42,700,446
30,306,207
(a)
Ordinary Shares
At the beginning of the reporting period
Shares issued during the year
Transaction costs
At the end of the reporting period
Group
2020
2019
No.
337,190,644
210,123,205
-
547,313,849
$
30,306,207
14,932,254
(2,538,015)
42,700,446
No.
309,007,937
28,182,707
-
337,190,644
$
29,201,668
1,711,605
(607,066)
30,306,207
On 7 January 2020, 326,839 fully paid ordinary shares were issued. This was in relation to the acquisition of 67% of PT Joyseed Berbagi Sukses.
There are a total of 8 tranches of 326,389 fully paid ordinary shares to be issued. Tranche 1, Tranche 2, Tranche 3, Tranche 4 and Tranche 5 have
been issued. Shares were issued at $0.09 per share. No cash was raised.
On 9 June 2020, 30,208,415 fully paid ordinary shares were issued. This was issued in relation to the outstanding Animoca Brands Limited
outstanding consideration. Shares were issued at $0.021 per share. No cash was raised.
On 18 September 2020, 62,500,000 fully paid ordinary shares were issued under a private placement. Shares were issued at $0.02 per share raising
a total of $1,250,000, net of capital raising costs.
On 24 and 25 September 2020, the following shares were issued:
-
-
-
26,666,666 fully paid ordinary shares were issued under a private placement. Shares were issued at $0.045 per share, raising a total of
$1,200,000, net of capital raising costs
1,833,333 fully paid ordinary shares were issued to Peak Asset Management and/or nominees and CPS Capital and/or nominees as
settlement of broker fees in relation to the private placement issued 18 September 2020. Shares were issued at $0.045 per share and no
cash was raised.
1,500,000 fully paid ordinary shares were issued as a result of an exercise of options. Shares were exercised at $0.05 per share, raising a
total of $75,000.
In the months of October and November 2020, a total of 15,657,450 fully paid ordinary shares were issued as a result of an exercise of options. The
following options were exercised:
-
-
-
8,000,000 unlisted options with an exercise price of $0.05 were exercised, raising a total of $400,000.
7,407,450 unlisted options with an exercise price of $0.08 were exercised, raising a total of $592,596.
250,000 unlisted options with an exercise price of $0.06 were exercised, raising a total of $15,000.
In the month of December, a total of 71,430,952 fully paid ordinary shares were issued. The following shares were issued:
-
-
71,064,286 fully paid ordinary shares were issued under a private placement. Shares were issued at $0.14 per share, raising a total of
$9,949,000.
366,666 unlisted options with an exercise price of $0.06 were exercised, raising a total of $22,000.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
42
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 19: Issued Capital (continued)
(b)
Options
The following reconciles with the outstanding listed options to subscribe for fully paid ordinary shares in the Company at the beginning and end of the
financial year.
Balance at beginning of the year
Issued during the financial year
Expired during the financial year
Released from escrow
Balance and Exercisable at the end of the year
On 21 December 2020, the following listed options were issued:
Group
2020
No.
2019
No.
-
116,032,143
-
-
116,032,143
30,533,333
-
(30,533,333)
-
-
-
-
-
-
45,532,143 listed options ("ICIOA") were issued pursuant to a Prospectus dated 21 December 2020. The options have an exercise price of
$0.22 and expiry date of 15 December 2022. 35,532,1439 ICIOAs were issued as free attaching options to the private placement
conducted in December 2020.
10,000,000 listed options ("ICIOA") were issued as Broker options in relation to the private placement conducted in December 2020.
70,500,000 listed options ("ICIOB") were issued pursuant to a Prospectus dated 21 December 2020. The options have an exercise price of
$0.025 and expiry date of 31 December 2022. 62,500,000 ICIOAs were issued as free attaching options to the private placement
conducted on 18 September 2020.
8,000,000 listed options ("ICIOB") were issued as Broker options in relation to the private placement conducted on 18 September 2020.
The ICIOA broker options issued during the financial year were calculated using the Black Scholes method and has a value of $654,822.
The ICIOB broker options issued during the financial year were calculated using the Black Scholes method and has a value of $1,104,687.
The following reconciles with the outstanding unlisted options to subscribe for fully paid ordinary shares in the Company at the beginning and end of
the financial year.
Balance at beginning of the year
Issued during the financial year
Expired during the financial year
Exercised during the financial year
Balance and Exercisable at the end of the year
Group
2020
No.
2019
No.
26,749,998
-
(500,000)
(17,524,116)
8,725,882
30,500,000
16,749,998
(20,500,000)
-
26,749,998
In the December quarter, the following options expired and were exercised:
-
-
-
-
On 26 November 2020, 500,000 unlisted options expired. The options had an exercise price of $0.05 and expiry date of 26 November
2020.
9,500,000 unlisted options were exercised. The options had an exercise price of $0.05 and expiry date of 26 November 2020. The total
amount raised was $475,000.
7,407,450 unlisted options were exercised. The options had an exercise price of $0.08 and expiry date of 14 June 2021. The total amount
raised was $592,596.
616,666 unlisted options were exercised. The options had an exercise price of $0.06 and expiry date of 22 July 2022. The total amount
raised was $37,000.
(c) Capital Management
Management controls the capital of the Group in order to maintain a sustainable debt to equity ratio, generate long-term shareholder value and
ensure that the Group can fund its operations and continue as a going concern.
The Group’s debt and capital include ordinary share capital and financial liabilities, supported by financial assets.
The Group is not subject to any externally imposed capital requirements.
Management effectively manages the Group’s capital by assessing the Group's financial risks and adjusting its capital structure in response to
changes in these risks and in the market. These responses include the management of debt levels, distributions to shareholders and share issues.
Total borrowings
Less cash and cash equivalents
Net debt
Total equity
Total capital
Gearing ratio
Note
17
8
Group
2020
$
480,790
(11,826,228)
(11,345,438)
2019
$
742,905
(414,229)
328,676
15,454,097
2,381,871
4,108,659
2,710,547
-276%
12%
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
43
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 20
Operating Segments
General Information
Identification of reportable 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 in determining the allocation of resources.
The Group is managed primarily on the basis of product category and service offerings as the diversification of the Group's operations inherently have
notably different risk profiles and performance assessment criteria. Operating segments are therefore determined on the same basis.
Reportable segments disclosed are based on aggregating operating segments where the segments are considered to have similar economic
characteristics and are also similar with respect to the following:
—
the products sold and/or services provided by the segment;
Types of products and services by segment
(i)
Development and sale of digital media (except games)
The Group is engaged in the development of software for interactive digital media (except games).
(ii)
Design and development of intellectual properties for software applications and games
The Group is also engaged in the design and development of intellectual properties for software applications and games.
Basis of accounting for purposes of reporting by operating segments
(a)
Accounting policies adopted
Unless stated otherwise, all amounts reported to the Board of Directors, being the chief operating decision makers with respect to operating
segments, are determined in accordance with accounting policies that are consistent with those adopted in the annual financial statements of the
Group.
(b)
Segment assets
Where an asset is used across multiple segments, the asset is allocated to the segment that receives the majority of the economic value from the
asset. In most instances, segment assets are clearly identifiable on the basis of their nature and physical location.
(c)
Segment liabilities
Liabilities are allocated to segments where there is direct nexus between the incurrence of the liability and the operations of the segment.
Borrowings and tax liabilities are generally considered to relate to the Group as a whole and are not allocated. Segment liabilities include trade and
other payables and certain direct borrowings.
(d)
Unallocated items
The following items of revenue, expense, assets and liabilities are not allocated to operating segments as they are not considered part of the core
operations of any segment:
• Impairment of assets and other non-recurring items of revenue or expense
• Income tax expense
• Current tax liabilities
• Other financial liabilities
• Intangible assets
(e)
Segment information
(i) Segment performance
31 December 2020
REVENUE
External sales
Total segment revenue
Reconciliation of segment revenue to group revenue
Total group revenue
Development
of digital
media
$
Development
of Intellectual
properties
$
All Other
Segments
Total
$
$
3,801
3,801
2,562,700
2,562,700
1,026,354
1,026,354
3,592,855
3,592,855
3,592,855
Segment result from continuing operations before tax
516,196
979,493
(1,248,884)
246,805
Reconciliation of segment result to group net profit/loss before tax
Intersegment elimination
Loss after tax from continuing operations
(293,075)
(46,270)
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
44
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 20: Operating Segments (continued)
31 December 2019
REVENUE
External sales
Total segment revenue
Reconciliation of segment revenue to group revenue
Total group revenue
Development
of digital
media
$
Development
of Intellectual
properties
$
All Other
Segments
Total
$
$
3,498
3,498
1,595,927
1,595,927
637,805
637,805
2,237,230
2,237,230
2,237,230
Segment result from continuing operations before tax
(636,400)
(169,443)
(1,352,971)
(2,158,814)
Reconciliation of segment result to group net profit/loss before tax
Intersegment elimination
Loss after tax from continuing operations
(ii) Segment assets
31 December 2020
Segment assets
Segment assets include:
—
Additions to non-current assets (other than financial assets
and deferred tax)
Reconciliation of segment assets to group assets
Intersegment eliminations
Total group assets
31 December 2019
Segment assets
Segment assets include:
—
Additions to non-current assets (other than financial assets
and deferred tax)
Reconciliation of segment assets to group assets
Intersegment eliminations
Total group assets
(iii) Segment liabilities
31 December 2020
Segment liabilities
Reconciliation of segment assets to group liabilities
Intersegment eliminations
Total group liabilities
31 December 2019
Segment liabilities
Reconciliation of segment assets to group liabilities
Intersegment eliminations
Total group liabilities
(164,221)
(2,323,035)
Development
of digital
media
$
Development
of Intellectual
properties
$
All Other
Segments
Total
$
$
257,776
5,408,895
40,123,948
45,790,619
253,634
3,919,062
27,907,315
32,080,011
Development
of digital
media
$
Development
of Intellectual
properties
$
(28,041,265)
17,749,354
Total
All Other
Segments
$
$
603,149
2,222,451
26,071,164
28,896,764
576,886
310,492
25,733,684
26,621,062
(24,699,822)
4,196,942
Development
of digital
media
$
Development
of Intellectual
properties
$
All Other
Segments
Total
$
$
174,441
1,216,877
903,939
2,295,257
Development
of digital
media
$
Development
of Intellectual
properties
$
-
2,295,257
Total
All Other
Segments
$
$
492,167
368,466
954,438
1,815,071
-
1,815,071
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
45
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 20: Operating Segments (continued)
(iv) Revenue by geographical region
Revenue, including revenue from discontinued operations, attributable to external customers is disclosed below, based on the principal place of
business.
Australia
Singapore
Malaysia
Indonesia
Total revenue
(v) Assets by geographical region
The location of segment assets by geographical location of the assets is disclosed below:
Australia
Singapore
Malaysia
Indonesia
Total Assets
Note 21
Cash Flow Information
Reconciliation of Cash Flows from Operating Activities with Profit after
Income Tax
Loss after income tax
Non-cash flows in profit
- Depreciation, amortisation and impairment
- Unrealised movement in fair value of intangibles
- Share of net profits of associates
- Provision for doubtful debts
- Options issued for services
- Shares issued for services
- Unrealised foreign currency gain
-
-
Interest revenue
Impairment expense
Changes in assets and liabilities, net of the effects of purchase and disposal of
subsidiaries:
-
-
-
-
-
(Increase)/decrease in trade and term receivables
(Increase)/decrease in prepayments
Increase/(decrease) in trade payables and accruals
Increase/(decrease) in income taxes payable
Increase/(decrease) in deferred taxes payable
Net cash generated by operating activities
2020
$
1,026,354
16,982
2,353,834
195,685
3,592,855
2019
$
637,805
12,838
1,582,650
3,937
2,237,230
2020
$
12,512,561
264,088
4,855,570
117,135
17,749,354
2019
$
1,371,345
610,431
2,194,212
20,954
4,196,942
Group
2020
$
2019
$
(46,270)
(2,323,035)
1,067,993
1,270,949
(133,467)
22,616
-
39,170
-
121,303
(56,054)
353,026
94,621
-
6,183
53,125
58,500
52,050
(60,752)
-
(1,102,465)
(131,767)
334,467
1,539
4,595
474,686
(192,736)
(62,747)
79,649
11
(879)
(1,025,061)
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
46
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 22
Share-based Payments
The aggregate share-based payments for the financial year are set out below:
Outstanding during the year
Granted
Exercised
Released from escrow
Expired
Outstanding and exercisable at year-end
2020
2019
Weighted
average
exercise price
$
Number
Weighted
average
exercise price
Number
26,749,998
18,000,000
(17,524,116)
-
(500,000)
26,725,882
$
0.068
0.133
0.063
0.050
0.115
30,500,000
16,749,998
-
(20,500,000)
-
26,749,998
The following share-based payment arrangements were in existence during the current reporting period:
Number
Grant Date
Expiry Date
Exercise Price
Fair value at
grant date
$
255,311
26,917
654,822
$
$0.08
$0.06
$0.025
$0.22
1,104,687
(i) Options granted
(ii) Options granted
(iii) Options granted
(iv) Options granted
8,092,550
633,332
8,000,000
10,000,000
14 June 2019
22 July 2019
4 December
2020
22 December
2020
14 June 2021
22 July 2022
31 December
2022
15 December
2022
Options were priced using the Black-Scholes model. Where relevant, the expected life used in the model has been adjusted based on management's best
estimate of the effects of non-transferability of exercise restrictions. Expected volatility is based on the historical share price volatility of the Company over
the reporting period.
Number
Share price at
grant date
Exercise Price
Expected
volatility
Option life
Risk-free
interest rate
15,500,000
1,249,998
10,000,000
8,000,000
$0.052
$0.036
$0.120
$0.155
$0.080
$0.060
$0.220
$0.025
139%
160%
134%
131%
2 years
3 years
2 years
2 years
1.49%
1.02%
0.09%
0.10%
Note 23
Events After the Reporting Period
On 5 January 2021, the Company issued 9,150,000 fully paid ordinary shares. These were issued as a result of 9,150,000 ICIOBs being exercised. A total
of $228,750 was raised.
On 5 January 2021, the Company announced it has successfully concluded and signed off a definitive joint venture agreement with Lemon Sky Studios,
and a joint venture company, Sky Candy Sdn Bhd has been incorporated in Malaysia.
On 22 January 2021, the Company issued 6,668,750 fully paid ordinary shares. These were issued as a result of 6,668,750 ICIOBs being exercised. A
total of $168,719 was raised.
On 12 February 2021, the Company issued 6,244,100 fully paid ordinary shares. These were issued as a result of 6,244,100 ICIOBs being exercised. A
total of $156,102 was raised.
On 15 February 2021, the Company announced it entered into a conditional Share Sale Agreement with Swedish incorporated RightBridge Ventures AB
to discpose of its 100% owned subsidiary, iCandy Digital Pte Ltd. This transaction is subjected to Shareholder's approval under Listing Rule 11.4
On 3 March 2021, the Company issued 2,380,000 fully paid ordinary shares. These were issued as a result of 2,380,000 ICIOBs being exercised. A total
of $59,500 was raised.
On 3 March 2021, the Company announced Mr Masahiko Honma and Mr Lum Piew have resigned. Mr Christopher Whiteman has been appointed as a
Non-Executive Director.
On 19 March 2021, the Company announced that it has entered into an agreement to acquire 100% voting capital of Nextgamer.io, a mobile game
platform and game developer in the business of developing a hyper-casual competitive video games and platform. The total acquisition consideration is
AUD$1,290,000, to be satisfied in cash of AUD$900,000 and 3 million fully paid ordinary shares at a deemed issue price of AUD$0.13 per share.
On 26 March 2021, the Company issued 7,163,722 fully paid ordinary shares. These were issued as a result of 3,700,000 ICIOBs, 1,241,500 unlisted
options with an exercise price of $0.08 and 2,222,222 unlisted options with an exercise price of $0.05 being exercised. A total of $302,931 was raised.
On 29 March 2021, the Company issued 3,000,000 fully paid ordinary shares. These were issued as part settlement for the acquisition of Nextgamer.io,
announced on 19 March 2021.
On 29 March 2021, the Company issued 250,002 unlisted options with an exercise price of $0.13, expiry date of 31 March 2025. These options were
issued under the Company's ESOS plan.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
47
For personal use only
ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 24
Related Party Transactions
Related Parties
(a)
The Group's main related parties are as follows:
i.
Entities exercising control over the Group:
The ultimate parent entity that exercises control over the Group is Fatfish Group Limited, formerly known as Fatfish Blockchain Limited, which is
incorporated in Australia.
ii.
Key Management Personnel:
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any
director (whether executive or otherwise) of that entity are considered key management personnel.
For details of disclosures relating to key management personnel, refer to Note 5.
(b)
Transactions with related parties:
Transactions between related parties are on normal commercial terms and conditions no more favourable than those available to other parties
unless otherwise stated.
The following transactions occurred with related parties:
i.
KMP related entities
- Directors' fees/wages paid to Kin Wai Lau
- Directors' fees paid to Lum Piew
- Directors' fees paid to Robert Kolodziej
- Directors' fees paid to Marcus Ungar
- Directors' fees paid to Masahiko Honma
- Directors' fees paid to Phillip Lord
(c)
Amount payable to and receivable from related parties
i. Loans payable to Fatfish Group Limited
Beginning of the year
Loans advanced
Loan repayment made
End of the year
ii. Loan payable to Fatfish Internet Pte Ltd
Beginning of the year
Loans advanced
Loan repayment made
Foreign currency movement
End of the year
iii. Loans to other related parties
Beginning of the year
Loans advanced
Loans repayment received
Foreign currency movement
End of the year
iv. Loans receivable from other related parties
Beginning of the year
Loans advanced
Loan repayment received
Foreign currency movement
End of the year
Group
2020
$
2019
$
151,308
-
12,000
18,000
-
-
181,308
25,309
24,500
12,000
18,000
-
38,000
117,809
Group
2020
$
2019
$
101,094
-
-
101,094
106,418
-
(5,324)
101,094
383,358
379,511
-
(240,000)
(5,890)
137,468
-
-
3,847
383,358
258,453
252,906
-
-
-
-
(17,594)
240,859
5,547
258,453
1,317,286
1,257,856
45,782
(100,000)
(92,106)
5,159
-
54,271
1,170,962
1,317,286
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
48
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 24: Related Party Transactions (continued)
v. Loans receivable from Fatfish Internet Pte Ltd
Beginning of the year
Loans advanced
Loan repayment received
Foreign currency movement
End of the year
93,552
93,552
-
(93,552)
-
-
-
-
-
93,552
(d) Other transactions and balances with Key Management Personnel:
There were no other transactions and balances during the reporting period. In 2017, Mr Kin Wai Lau had loaned Appxplore (iCandy) Limited AUD
$196,290 (SGD $200,000).
Note 25
Financial Risk Management
The Group’s financial instruments consist mainly of deposits with banks, local money market instruments, short-term investments, accounts receivable
and payable and loans to and from subsidiaries
The totals for each category of financial instruments, measured in accordance with AASB 9: Financial Instruments as detailed in the accounting policies
to these financial statements, are as follows:
Financial Assets
Cash and cash equivalents
Trade and other receivables
Other financial assets
Total Financial Assets
Financial Liabilities
Trade and other payables
Other financial liabilities
Total Financial Liabilities
Financial Risk Management Policies
Note
8
9
10
16
17
Group
2020
$
2019
$
11,826,228
1,454,978
414,229
352,513
1,248,758
1,415,336
14,529,964
2,182,078
1,609,160
1,009,471
480,790
742,905
2,089,950
1,752,376
The directors are responsible for iCandy Interactive Limited's risk management strategy and management is responsible for implementing the directors'
strategy. A risk management program focuses on the unpredictability of finance markets and seeks to minimise potential adverse effects on financial
performance. iCandy Interactive Limited uses different methods to measure different types of risk to which it is exposed. These methods include
sensitivity analysis in the case on interest rate and market risk. iCandy Interactive Limited does not use derivatives.
The consolidated entity's financial instruments consist of deposits with banks and accounts receivables and payables. The main purpose of non-derivative
financial instruments is to raise finance for group operations.
Specific Financial Risk Exposures and Management
The main risks the Group is exposed to through its financial instruments are credit risk, liquidity risk and market risk consisting of interest rate risk and
foreign currency risk.
a. Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead
to a financial loss to the Group.
The Group does not have any significant risk exposure to any single counterparty or any group of counterparties having similar characteristics. The
credit risk on liquid funds and derivative financial instruments is limited as the counterparties are banks with high credit ratings assigned by
international credit rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represent the Group's maximum
exposure to credit risk.
b.
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise meeting its obligations related to
financial liabilities. The Group manages this risk through the following mechanisms:
• preparing forward-looking cash flow analyses in relation to its operating, investing and financing activities;
• obtaining funding from a variety of sources;
• maintaining a reputable credit profile; and
• only investing surplus cash with major financial institutions
The table below reflects an undiscounted contractual maturity analysis for financial liabilities. Bank overdrafts have been deducted in the analysis as
management does not consider that there is any material risk that the bank will terminate such facilities. The bank does however maintain the right to
terminate the facilities without notice and therefore the balances of overdrafts outstanding at year-end could become repayable within 12 months.
Financial guarantee liabilities are treated as payable on demand since the Group has no control over the timing of any potential settlement of the
liabilities.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
49
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 25: Financial Risk Management (continued)
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 reflect the earliest contractual settlement dates and do not
reflect management’s expectations that banking facilities will be rolled forward.
Financial liability and financial asset maturity analysis
Consolidated Group
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
2020
$
2019
$
Within 1 Year
1 to 5 years
Over 5 years
Total
Financial liabilities due for payment
Trade and other
payables
Other financial
liabilities
Total expected
outflows
1,609,160
1,009,471
480,790
742,905
2,089,950
1,752,376
-
-
-
Consolidated Group
Within 1 Year
1 to 5 years
2020
$
2019
$
2020
$
2019
$
Financial Assets - cash flows realisable
Cash and cash
equivalents
Trade and other
receivables
Other financial assets
Total anticipated
inflows
11,826,228
414,229
1,454,978
352,513
1,248,758
1,421,012
14,529,964
2,187,754
Net (outflow) / inflow on
financial instruments
12,440,014
435,378
c. Market Risk
i.
Interest rate risk
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Over 5 years
2020
$
2019
$
-
-
-
-
-
-
-
-
-
-
-
-
-
1,609,160
1,009,471
480,790
742,905
2,089,950
1,752,376
Total
2020
$
2019
$
11,826,228
414,229
1,454,978
352,513
1,248,758
1,421,012
14,529,964
2,187,754
12,440,014
435,378
The Group's exposure to market risk primarily consists of financial risks associated with changes in interest rates as detailed below. As the level of
risk is low, the Group does not use any derivatives to hedge its exposure.
The Group is not exposed to interest rate risk on its non-current borrowings as the terms of the loan agreement stipulates that no interest is payable.
ii. Foreign currency risk
Exposure to foreign currency risk may result in the fair value or future cash flows of a financial instrument fluctuating due to movement in foreign
exchange rates of currencies in which the Group holds financial instruments which are other than the AUD functional currency of the Group.
With instruments being held by overseas operations, fluctuations in the SGD Dollar and Malaysia Ringgit may impact on the Group’s financial results
unless those exposures are appropriately hedged.
The following significant exchange rates were applied during the year.
$1 AUD
Singapore
Malaysia
Indonesian Rupiah
iii. Sensitivity Analysis
2020
2019
Average Rate
Spot Rate
Average Rate
Spot Rate
1.0189
0.9438
0.9483
3.0897 2.8794 2.8670
9,996 10,748 9,834.0 9,719.0
0.9517
2.8996
The following table illustrates sensitivities to the Group’s exposures to changes in interest rates, exchange rates and commodity and equity prices. The
table indicates the impact of how profit and equity values reported at the end of the reporting period would have been affected by changes in the relevant
risk variable that management considers to be reasonably possible.
These sensitivities assume that the movement in a particular variable is independent of other variables.
Year ended 31 December 2020
+/- 0.75% in interest rates
+/- 10% in $A/$SGD
+/- 10% in $A/$MYR
Group
Profit
$
88,697
374
3,229
Equity
$
88,697
374
3,229
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
50
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 25: Financial Risk Management (continued)
Year ended 31 December 2019
+/- 0.75% in interest rates
+/- 10% in $A/$SGD
+/- 10% in $A/$MYR
Group
Profit
$
Equity
$
3,107
246
620
3,107
246
620
There have been no changes in any of the methods or assumptions used to prepare the above sensitivity analysis from the prior year.
Fair Values
Fair value estimation
The fair values of financial assets and financial liabilities are presented in the following table and can be compared to their carrying amounts as presented
in the statement of financial position. Refer to Note 26 for detailed disclosures regarding the fair value measurement of the group’s financial assets and
financial liabilities.
Differences between fair values and carrying amounts of financial instruments with fixed interest rates are due to the change in discount rates being
applied by the market since their initial recognition by the Group.
Consolidated Group
Financial assets
Cash and cash equivalents
Trade and other receivables:
Other financial assets
Total financial assets
Financial liabilities at amortised cost
Trade and other payables
Other financial liabilities
Total financial liabilities
Note
2020
Carrying
Amount
$
Fair Value
$
Carrying
Amount
$
2019
Fair Value
$
8
9
10
16
17
11,826,228
1,454,978
1,248,758
14,529,964
11,826,228
1,454,978
1,248,758
14,529,964
414,229
352,513
1,415,336
2,182,078
414,229
352,513
1,415,336
2,182,078
1,609,160
480,790
2,089,950
1,609,160
480,790
2,089,950
1,009,471
742,905
1,752,376
1,009,471
742,905
1,752,376
(i)
Cash and cash equivalents, trade and other receivables, and trade and other payables are short-term instruments in nature whose carrying amounts
are equivalent to their fair values.
(ii)
Term receivables reprice to market interest rates every three months, ensuring carrying amounts approximate fair value.
Note 26
Fair Value Measurements
The Group measures and recognises the following assets and liabilities at fair value on a recurring basis after initial recognition:
— investments accounted for using the equity method.
The Group does not subsequently measure any liabilities at fair value on a non-recurring basis.
(a) Fair value hierarchy
AASB 13: Fair Value Measurement requires the disclosure of fair value information by level of the fair value hierarchy, which categorises fair value
measurements into one of three possible levels based on the lowest level that an input that is significant to the measurement can be categorised into
as follows:
Level 1
Level 2
Level 3
Measurements based on quoted prices
(unadjusted) in active markets for identical assets
or liabilities that the entity can access at the
measurement date.
Measurements based on inputs other than
quoted prices included in Level 1 that are
observable for the asset or liability, either
directly or indirectly.
Measurements based on unobservable inputs
for the asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These
valuation techniques maximise, to the extent possible, the use of observable market data. If all significant inputs required to measure fair value are
observable, the asset or liability is included in Level 2. If one or more significant inputs are not based on observable market data, the asset or liability
is included in Level 3.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
51
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 25: Financial Risk Management (continued)
Valuation techniques
The Group selects a valuation technique that is appropriate in the circumstances and for which sufficient data is available to measure fair value. The
availability of sufficient and relevant data primarily depends on the specific characteristics of the asset or liability being measured. The valuation
techniques selected by the Group are consistent with one or more of the following valuation approaches:
●
Market approach: valuation techniques that use prices and other relevant information generated by market transactions for identical or similar
assets or liabilities.
●
Income approach: valuation techniques that convert estimated future cash flows or income and expenses into a single discounted present value.
●
Cost approach: valuation techniques that reflect the current replacement cost of an asset at its current service capacity.
Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the asset or liability, including
assumptions about risks. When selecting a valuation technique, the Group gives priority to those techniques that maximise the use of observable
inputs and minimise the use of unobservable inputs. Inputs that are developed using market data (such as publicly available information on actual
transactions) and reflect the assumptions that buyers and sellers would generally use when pricing the asset or liability are considered observable,
whereas inputs for which market data are not available and therefore are developed using the best information available about such assumptions are
considered unobservable.
Digital currencies have been value using Level 1 input. Market value has been determined by various platforms, including
https://coinmarketcap.com/.
Note 27
Reserves
a.
Foreign currency translation reserve
The foreign currency translation reserve records exchange differences arising on translation of a foreign controlled subsidiary.
Balance at the beginning of the period
Foreign currency movements during the year
b. Premium on assets acquired
Group
2020
$
(64,383)
347,301
282,918
2019
$
57,471
(121,854)
(64,383)
When the Company acquired Appxplore (iCandy) Limited, formerly known as iCandy Ventures Limited, a company incorporated in British Virgin
Island and iCandy Digital Pte Ltd, a company incorporated in Singapore, this transaction was assessed as a transaction involved entities under
common control. The Company was formed to effect the business combination and consideration was settled via the issue of equity interests. As the
Company was incorporated to effect the transactions, it was determined that iCandy Interactive Limited would be the legal acquirer and Appxplore
(iCandy) Limited would be the accounting acquirer as it was an entity that was carrying on a business prior to the business combination,
In accordance with the accounting policy adopted, all assets and liabilities will be recorded at their book value at the date of acquisition. The
remaining difference between the fair value of the consideration paid and the book value of the net assets acquired is allocated to equity.
Balance at the beginning of the period
c. Option reserve
The option reserve records the fair value movement on options.
Balance at the beginning of the period
Issue of options during the year
Exercise of options during the year
Expiry of options during the year
Total Reserves
Foreign currency translation reserve
Other components of equity
Option reserve
Group
2020
$
2019
$
20,289,999
20,289,999
20,289,999
20,289,999
Group
2020
$
(999,590)
(1,759,510)
694,489
22,874
(2,041,737)
2019
$
(457,457)
(542,133)
-
-
(999,590)
Group
2020
$
282,918
20,289,999
(2,041,737)
18,531,180
2019
$
(64,383)
20,289,999
(999,590)
19,226,026
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
52
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 712
NOTES TO THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 DECEMBER 2020
Note 28
Contingent Liabilities
During the 2018 financial year, the Company completed its Asset purchase of a Portfolio of Games from Animoca Brands Limited ("AB1").
There is a contingent liability in relation to the purchase and they are listed below.
Earn Out Payment
For a period of 5 years from the Completion Date, AB1 shall be entitled to share in the Net Games Profits from the Games, in accordance with the
following conditions:
-
During any year in which the Net Games Profit from the Games reaches AUD $1,000,000, AB1 shall receive a cash payment equal to at least
10% of such Net Profit as AB1's profit share payable within 15 days of the final determination of the Net Games Profit. The value of AB1's profit
share for any such year shall increase by 10% for each addition AUD $500,000 in Net Games Profit reached by the Games during such year, up
to a maximum of 50%. The table below illustrates how the Company and AB1 intend for the profit share scheme to work:
Net Games Profit (AUD)
1,000,000 - 1,499,999.99
1,500,000 - 1,999,999.99
2,000,000 - 2,499,999.99
2,500,000 - 2,999,999.99
3,000,000 - 3,499,999.99
3,500,000
Profit Share
10%
20%
30%
40%
50%
50%
During the 2019 financial year, the Company completed its purchase of 67% of PT Joyseed Berbagi Sukses, an Indonesian mobile gaming development
studio. There is a contingent liability in relation to the purchase and is listed below:
Performance Payments
-
If within 24 months from the completion date, PT Joyseed Berbagi Sukses achieves a revenue milestone of AUD$350,000, the Company will
issue AUD $100,000 worth of the Company's shares to the Vendors within 10 Business days, issued at the Issue Price of $0.09 per share.
Note 29
Company Details
The registered office of the company is:
iCandy Interactive Limited
Level 4, 91 William Street
Melbourne Vic 3000
The principal places of business are:
iCandy Interactive Limited
Level 4, 91 William Street
Melbourne Vic 3000
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
53
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 871 72
DIRECTORS' DECLARATION
In accordance with a resolution of the directors of iCandy Interactive Limited, the directors of the Company declare
that:
1.
the financial statements and notes, as set out on pages 22 to 53, are in accordance with the Corporations Act
2001 and:
(a)
(b)
comply with Australian Accounting Standards applicable to the entity, which, as stated in accounting
policy Note 1 to the financial statements, constitutes compliance with International Financial Reporting
Standards; and
give a true and fair view of the financial position as at 31 December 2020 and of the performance for the
year ended on that date of the consolidated group;
in the directors' opinion there are reasonable grounds to believe that the company will be able to pay its debts
as and when they become due and payable; and
the directors have been given the declarations required by section 295A of the Corporations Act 2001 from
the Chief Executive Officer and Chief Financial Officer.
2.
3.
Director
Dated this
Mr Kin Wai Lau
31 March 2021
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
54
For personal use only Independent Auditor's Report
To the Members of iCandy Interactive Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of iCandy Interactive Limited (“the Company”) and
its subsidiaries (“the Consolidated Entity”), which comprises the consolidated statement
of financial position as at 31 December 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 statements, including a summary of significant accounting policies, and the
directors’ declaration.
In our opinion:
a.
the accompanying financial report of the Consolidated Entity is in accordance with
the Corporations Act 2001, including:
(i)
giving a true and fair view of the Consolidated Entity’s financial position as
at 31 December 2020 and of its financial performance for the year then
ended; and
(ii)
complying with Australian Accounting Standards and the Corporations
Regulations 2001.
b.
the financial report also complies with International Financial Reporting Standards
as disclosed in Note 1.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Those
standards require that we comply with relevant ethical requirements relating to audit
engagements and plan and perform the audit to obtain reasonable assurance about
whether the financial report is free from material misstatement. 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 Consolidated Entity in
accordance with the auditor independence requirements of the Corporations Act 2001
and the ethical requirements of the Accounting Professional and Ethical Standards
Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are
relevant to our audit of the financial report in Australia. We have also fulfilled our other
ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
For personal use only
Independent Auditor’s Report
To the Members of iCandy Interactive Limited (Continued)
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.
Key audit matter
How our audit addressed the key audit matter
Intangible assets – Research and Development
costs
As disclosed in note 13, the Consolidated Entity has
intangible assets of $2,677,469, of which
$1,232,515 related to capitalised research and
development costs.
Capitalised research and development costs are
considered to be a key audit matter due to the size
of the size of the balance and the judgement
required in recognising development costs in line
with the accounting standards and assessment for
impairment.
Recoverability of other financial assets
The Consolidated entity has provided loans to
multiple entities including related parties and to
external parties, totalling $1,248,758, as disclosed in
Note 10.
Due to the quantum of the loans, the recoverability of
the loans were considered a key audit matter.
Our procedures amongst others included:
Evaluating the nature of the type of the research
and development expenses incurred that are
capitalized into intangible assets
Evaluating the appropriateness of expenses
capitalised, on a sample basis, including the
verification of the material external costs and
employees costs to external invoices and
internal payroll records.
Assessing whether there are any indicators of
impairment of the asset, including understanding
management’s planned future commercialisation
activities;
Comparing market capitalisation as at sign-off
date to the carrying value of net assets at year-
end; and
Assessing the appropriateness of the disclosures
included in Note 13 to the financial statements.
Our procedures amongst others included:
Obtaining loan confirmations;
Discussions held with management over the
recoverability of the loans;
Assessment of the counterparty’s capacity to
repay the loan; and
We assessed the appropriateness of the disclosures
included in Notes 10 to the financial report.
For personal use only
Independent Auditor’s Report
To the Members of iCandy Interactive Limited (Continued)
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Consolidated Entity’s annual report for the year ended 31 December 2020, but does not include
the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
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 Note 1, the
directors also state in accordance with Australian Accounting Standard AASB 101 Presentation of Financial
Statements, that the financial report complies with International Financial Reporting Standards.
In preparing the financial report, the directors are responsible for assessing the Consolidated Entity’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Consolidated Entity or to cease
operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our responsibility is to express an opinion on the financial report based on our audit. Our objectives are to
obtain reasonable assurance about whether the financial report as a whole is free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian
Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement
and maintain professional scepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the financial report, whether due to fraud or
error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
For personal use only
Independent Auditor’s Report
To the Members of iCandy Interactive Limited (Continued)
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Consolidated Entity’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Consolidated Entity’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Consolidated Entity to cease to
continue as a going concern.
Evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that
achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Consolidated Entity to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Consolidated Entity audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during our
audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the financial report of the current period and are therefore the key audit matters. We describe
these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
For personal use only
Independent Auditor’s Report
To the Members of iCandy Interactive Limited (Continued)
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended 31 December
2020. The directors of the Company are responsible for the preparation and presentation of the remuneration
report in accordance with s 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.
Auditor’s Opinion
In our opinion, the Remuneration Report of the Company, for the year ended 31 December 2020, complies
with section 300A of the Corporations Act 2001.
BENTLEYS
Chartered Accountants
MARK DELAURENTIS CA
Partner
Dated at Perth this 31st day of March 2021
For personal use only
ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 604 871 712
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
The following information is current as at 26 March 2020:
1.
a.
b.
c.
Shareholding
Distribution of Shareholders
No. of Holders
No. of Ordinary
Shares
Category (size of holding)
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
89
736
1,038
2,178
493
4,534
5,634
2,846,491
8,261,896
79,971,704
487,834,696
578,920,421
The number of shareholdings held in less than marketable parcels is nil (2019: 507).
The names of the substantial shareholders listed in the holding company’s register are:
Shareholder
Fatfish Internet Pte Ltd
Animoca Brands Limited
d.
Voting Rights
Number
No. of Fully Paid
Ordinary Shares
% Held of Issued
Ordinary Capital
187,500,001
41,008,415
32.39%
7.08%
The voting rights attached to each class of equity security are as follows:
Ordinary shares
–
Each ordinary share is entitled to one vote when a poll is called, otherwise each member present at a
meeting or by proxy has one vote on a show of hands.
e.
20 Largest Shareholders — Ordinary Shares
Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
FATFISH INTERNET PTE LTD
ANIMOCA BRANDS LIMITED
ACORN MANAGED INVESTMENTS PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA)
LIMITED
CITICORP NOMINEES PTY LIMITED
MR DOMINIC VIRGARA
TECHFORCE PERSONNEL PTY LIMITED
ESPORTS.COM GROUP AG
FATFISH MEDIALAB PTE LTD
MR TAN HOANG HO
INCUBATE FUND 1-G LIMITED PARTNERSHIP
BEARDED ROOSTER NOMINEES PTY LTD
SANGREAL INVESTMENTS PTY LTD
LEAD NATION HOLDINGS LIMITED
BLUE BOAT GROUP LIMITED
ROCK THE POLO PTY LTD
KLI PTY LTD
RED AND WHITE HOLDINGS PTY LTD
BRIDGEPORT ENTERPRISES PTY LTD
MS BIWEI HUANG & MR YUANXING PAN
Number of Ordinary
Fully Paid Shares
Held
187,500,001
41,008,415
22,222,222
13,740,311
12,802,465
8,000,000
7,000,000
6,815,091
5,000,000
4,668,113
4,140,056
4,000,000
3,500,000
2,580,000
2,375,199
2,350,000
2,300,000
2,222,222
2,000,000
1,900,000
336,124,095
% Held
of Issued
Ordinary Capital
32.39%
7.08%
3.84%
2.37%
2.21%
1.38%
1.21%
1.18%
0.86%
0.81%
0.72%
0.69%
0.60%
0.45%
0.41%
0.41%
0.40%
0.38%
0.35%
0.33%
58.07%
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
58
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 604 871 712
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
f.
20 Largest Options Holders - Listed Options (ICIOA)
Name
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
CS THIRD NOMINEES PTY LIMITED
MISHTALEM PTY LTD
LTL CAPITAL PTY LTD
ROCK THE POLO PTY LTD
HARDWOOD HOLDINGS PTY LTD
MR JAMES CHEN
MR MATTHEW IAN BANKS & MRS SANDRA
ELIZABETH BANKS
CITICORP NOMINEES PTY LIMITED
KEYFORM ENTERPRISES PTY LTD
MR MARK CARLO D'ALESSANDRO
SUNSET CAPITAL MANAGEMENT PTY LTD
SHANE FERNANDO HOLDINGS PTY LTD
PARADISE BAY INTERNATIONAL PTY LTD
MR RICKY STEVEN NEUMANN
JAMBER INVESTMENTS PTY LTD
SANGREAL INVESTMENTS PTY LTD
MR DOMINIC VIRGARA
KNIGHT61 INVESTMENTS PTY LTD
MRS FU CHIAO YU
MX NOMINEES PTY LTD
Number of Listed
Options (ICIOA)
6,398,571
5,321,429
5,000,000
2,800,000
2,150,000
2,000,000
1,983,014
1,785,714
1,000,000
1,000,000
1,000,000
825,000
757,056
714,285
711,841
500,000
500,000
484,667
475,000
450,000
35,856,577
% Held
of ICIOA
14.05%
11.69%
10.98%
6.15%
4.72%
4.39%
4.36%
3.92%
2.20%
2.20%
2.20%
1.81%
1.66%
1.57%
1.56%
1.10%
1.10%
1.06%
1.04%
0.99%
78.75%
g.
20 Largest Options Holders - Listed Options (ICIOB)
Name
Number of Listed
Options (ICIOB)
% Held
of ICIOB
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
10 BOLIVIANOS PTY LTD
HARDWOOD HOLDINGS PTY LTD
MR RYAN TRAVIS SIMPSON
CASTLE PROPERTY DEVELOPMENTS PTY LTD
BEARDED ROOSTER NOMINEES PTY LTD
RIMOYNE PTY LTD
CRANLEY CONSULTING PTY LTD
MR MATTHEW STUART DIXON
MISS LISA ANNE RANDALL
BLUE BOAT GROUP LIMITED
MR TRENT MILLAR
ROCK THE POLO PTY LTD
MR NOEL RUSSELL CAMERON & DR BELINDA
CAROLINE GOAD
MALCORA PTY LTD
JOBE SUPER PTY LTD
FTM SHARE INVESTMENTS PTY LTD
MS EILEEN LILIAN COLLINS & MR ADAM JAMES
MR MARK ANTHONY BROGLIO
CORRIGAN RETIREMENT PTY LTD
N REILLY INVESTMENTS PTY LTD
7,915,435
2,000,000
2,000,000
1,830,000
1,500,000
1,500,000
1,450,000
1,405,000
1,250,000
1,250,000
1,000,000
1,000,000
1,000,000
925,000
750,000
750,000
744,824
700,000
600,000
577,587
30,147,846
18.69%
4.72%
4.72%
4.32%
3.54%
3.54%
3.42%
3.32%
2.95%
2.95%
2.36%
2.36%
2.36%
2.18%
1.77%
1.77%
1.76%
1.65%
1.42%
1.36%
71.16%
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
59
For personal use only ICANDY INTERACTIVE LIMITED AND CONTROLLED ENTITIES
ABN: 87 604 604 871 712
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
2.
3.
4.
5.
The name of the company secretary is Mr Andrew Draffin and Ms Jiahui Lan.
The address of the principal registered office in Australia is Level 4, 91 William Street, Melbourne Victoria
3000.
Registers of securities are held at the following addresses
Link Market Services Limited
Level 4, 152 St Georges Terrace
Perth WA 6000
Stock Exchange Listing
Quotation has been granted for all the ordinary shares of the company on all Member Exchanges of the
Australian Securities Exchange Limited.
iCandy Interactive Limited Financial Report for the year ended 31 December 2020
60
For personal use only