INDOOR SKYDIVE AUSTRALIA GROUP LIMITED
ABN: 39 154 103 607
CONTENT
Chairman’s letter
Directors’ Report
Remuneration Report (Audited)
Auditor’s Independence Declaration
Financial Report
Shareholder Information
Corporate Directory
04
07
13
25
26
74
77
CHAIRMAN’S LETTER
Dear Shareholder
On behalf of the ISA Group Board
of Directors I am pleased to present
to you the 2016 Annual Report.
MILESTONE ACHIEVEMENTS
The last 12 months has been a
busy, exciting and successful year
for the Group. During the year we:
continued to successfully operate
our Penrith facility; completed and
opened our Gold Coast facility;
and commenced construction of
our third facility in Perth. These
exciting events reflect our growth
and demonstrated commitment
to meeting our strategic aims.
The operation of multiple facilities
has allowed us to fully implement
our Group structure, realise many
economies of scale, and consolidate
our operating blueprint.
We were also very pleased to
welcome to our Board Ms Kirsten
Thomson. Kirsten possesses
strong financial skills and capital
markets experience. These skills,
combined with those of other
Board members will greatly benefit
the Group as we move forward
with our strategy for domestic and
international expansion.
The only downside to our year
was the late opening of our Gold
Coast facility and the subsequent
loss of anticipated high season
tourism income. After a slow start,
iFLY Gold Coast launch
the Gold Coast facility is now
operating at the anticipated levels.
The construction lessons learned on
the Gold Coast site have resulted
in a more robust and outsourced
construction management model
for our Perth facility. Perth
construction is currently well
underway and expected delivery
milestones are being met.
Our systems and processes have
evolved to support multiple
facilities and business entities. We
have doubled the number of flight
instructors within our Group. With
this growth we have demonstrated
a commitment to training and
developing local employees
within our facilities. This strategy
has ensured that we can deliver
internationally recognised in-house
training programs, without the use
of third parties, while supporting
local employment in Sydney’s West
and on the Gold Coast. Recruitment
for our Perth tunnel is already well
underway and staff training will
commence in the short term.
Indoor skydiving continues to
grow as a sport. In August we are
conducting the second Australian
Indoor Skydiving Championships.
Over 60 teams have already
registered to compete this year, a
48 percent increase over the 2015
Championship. Brand recognition is
being achieved and there is clearly
a greater community understanding
of the experience we provide.
Ken Gillespie
Chairman
4
2016 Annual Report | Perth’s indoor skydiving facility
Thank you for your ongoing support
of our Company. 2016 has been
another exciting and productive
year and I look forward to 2017 as
another milestone year.
Ken Gillespie
Chairman
OPERATING BLUEPRINT
In 2016 we have consolidated our
tunnel operating and booking
processes to ensure that we
deliver a quality, customer focused
experience - every time. These
operating processes now form
the blueprint of our operations
and will be the foundation for
customer service at each of our
indoor skydiving facilities, both
domestically and internationally.
Our endeavours in this regard have
been positively recognised by our
customers, including on social
media, and we enjoy high ratings
from key reviewing websites such
as TripAdvisor.
PLATFORM FOR GROWTH
When iFLY Perth comes online
towards the end of the year, ISA
Group will have established a very
stable operations base from which to
continue the pursuit of future growth.
These three operational entities;
iFLY Downunder, iFLY Gold Coast
and iFLY Perth provide an important
growth platform. They allow the
Group to use each facility to:
• Provide greater economies of
scale in relation to corporate
costs.
• Ensure the common application of
policies, management practices,
and lessons learnt.
• Fund organic growth as each
facility is cash flow positive from
the commencement of operations.
• Enable integration to promote the
growth of indoor skydiving as a
sport and to provide a basis for
competitions, ongoing industry
improvement and skydiving
comradery.
THE YEAR AHEAD
The new financial year will provide
us with a number of exciting
opportunities to be evaluated, both
domestically and internationally.
These opportunities will allow
us to leverage our cash positive
platforms for growth and access to
new markets. These opportunities
complement our stated strategic
plan and are the subject of current
consideration. I look forward to
better inform shareholders as
we reach appropriate stages of
commercial development and
market advice.
• Mitigate the impacts of potential
economic downturns or changes.
For example, there is no singular
reliance on local users, inbound
tourists, professional flyers or
retail buyers across the Group.
I encourage you to read our
financial performance which is
detailed in the Financial Report.
The Board has determined that no
dividend will be declared while the
Company’s focus is on growth.
5
| 2016 Annual Report BOARD OF DIRECTORS
From left to right:
David Murray AO
Non-Executive Director
Kirsten Thomson
Non-Executive Director
Ken Gillespie AC, DSC, CSM
Chairman
Danny Hogan MG
Director & Chief Operations Officer
Wayne Jones
Director & Chief Executive Officer
Stephen Baxter
Non-Executive Director
6
2016 Annual Report | DIRECTORS’
REPORT
Ken Gillespie AC, DSC, CSM
Chairman
Danny Hogan MG
Director & Chief Operations Officer
Stephen Baxter
Non-Executive Director
Directors’ Report
DIRECTORS’ REPORT
Your Directors present their report on the
consolidated entity (referred to hereafter as ISA
Group) consisting of Indoor Skydive Australia
Group Limited (the Company) and the entities it
controlled at the end of, or during, the year ended
30 June 2016.
DIRECTORS
The following individuals were Directors of the
Company at all times during the year and at the
date of this Directors’ Report, unless otherwise
stated:
Ken Gillespie AC, DSC, CSM
Chairman
Appointed 18 October 2012
One of Australia’s most distinguished career
soldiers, Lieutenant General (retired) Ken Gillespie,
AC, DSC, CSM, is the Chairman of ISA Group.
During the year he was a member of the
Remuneration & Nomination Committee and the
Audit & Risk Committee. He was also the
Chairman of the Remuneration & Nomination
Committee until 23 August 2016 when he stepped
down from the chair although he remains a
member of the Remuneration & Nomination
Committee.
Ken is on the Board of Directors of leading local
defence manufacturer, Airbus Asia Pacific Group,
and ASX listed, Senetas Limited. He is also a council
member of the Australian Strategic Policy Institute,
an internationally recognised Canberra based think
tank. Ken, who served with the Australian Defence
Force for over 43 years, was appointed Chief of
Army in July 2008, a position he held until his
retirement in June 2011. Previously he had served
as Land Commander Australia and Vice Chief of the
Australian Defence Force.
Wayne Jones
Director & Chief Executive Officer
Appointed 4 November 2011
Wayne served for 21 years in the Australian
Defence Force and was part of the highly
acclaimed Special Air Service Regiment for the last
14 years of his career. Wayne holds various senior
instructor qualifications and has been at the
forefront of Australian Military Freefall
development and training over the past 10 years.
He is still involved in the training of special forces
troops and he continues to participate in the sport
of skydiving at the highest levels. Wayne is a
member of the Australian Institute of Company
Directors.
Danny Hogan MG
Director & Chief Operations Officer
Appointed 4 November 2011
Danny enlisted in the Australian Regular Army in
1991, and in 1997 was selected for further service
within the Special Air Service Regiment. He has
been recognised and awarded for his actions and
leadership during his 21 year military career
including receiving the Medal for Gallantry. He was
selected and completed a two year military
exchange in the USA with two of the USA’s elite
Special Forces Commands. While in the USA he
gained his freefall parachuting qualifications and
developed a very strong background in the use of
vertical wind tunnel simulation training. Danny
was a highly qualified senior dive instructor within
the Special Air Service Regiment. Danny is a
member of the Australian Institute of Company
Directors.
Stephen Baxter
Non-Executive Director
Appointed 13 August 2012
Former Regular Army electronics technician turned
successful entrepreneur, Steve is the founder of
early Internet Provider SE Net and co-founder of
telecommunications infrastructure company, Pipe
Networks Ltd. In 2008 he moved to the USA and
joined Google Inc deploying high speed
telecommunication infrastructure, before
returning to Australia.
Steve is a director of Vocus Communications
Limited (resigned 22 February 2016) and Other
Levels Limited. He is also known for his
entrepreneurial skills and appears on the popular
TV show “Shark Tank”. He is the founder of
Brisbane based not-for-profit River City Labs - an
early stage and start-up co-working space for tech
and creative companies.
During the year Steve has been a member of the
Remuneration & Nomination Committee and
Chairman of the Audit & Risk Committee. From 23
August 2016 Steve has taken the role of Chairman
of the Remuneration & Nomination Committee
and stepped down as Chairman of the Audit & Risk
Committee.
Directors’ Report
David Murray AO
Non-Executive Director
Appointed 3 February 2014
requirements of the business and investment
communities.
From 23 August 2016 Kirsten has been appointed
Former Chief Executive Officer of Commonwealth
as Chair of the Audit and Risk Committee and as a
Bank of Australia and Chairman of the Australian
member of the Nomination & Remuneration
Government Future Fund, David has over 40 years’
Committee.
experience in banking and financial services. He
was appointed an Officer of the Order of Australia
Malcolm Thompson
in 2007 for services to the finance sector nationally
Former Alternative Director for Stephen Baxter
community as a supporter and fundraiser. David is
training, Malcolm has over 24 years’ experience
and internationally through strategic leadership
and policy development, to education through
fostering relations between educational
institutions, business and industry, and to the
Chairman of the Butterfly Foundation.
Kirsten Thomson
Non-Executive Director
Appointed 21 June 2016
Appointed 13 February 2013
Resigned 21 June 2016
An accountant and governance specialist by
across technology, telecommunications, R&D and
aerospace industries in senior roles, including chief
financial officer, company secretary and director
roles. He has been instrumental in setting up
governance, financial and operational aspects for
listed companies and has assisted a local
Kirsten Thomson has over 20 years’ experience in
subsidiary of Airbus NV (EPA:EAD) relating to $6B
the fields of funds management and equities
construction and maintenance contracts for
research. She has demonstrated strong success in
advanced military helicopters.
a broad range of strategic challenges including
competing business models, challenging economic
COMPANY SECRETARY
cycles and differing and emerging commercial
approaches to doing business in Australia and
abroad.
Fiona Yiend
General Counsel & Company Secretary
Appointed 16 October 2013
Kirsten’s extensive experience with listed entities
Fiona Yiend is an experienced company secretary
has given her a deep understanding of the
with has over 7 years’ experience in the listed
essentials of business planning, management of
environment. She holds a Bachelor of Arts,
key performance indicators and financial
statements. She has a Masters of Finance and is a
graduate of the Australian Institute of Company
Directors. She also has a keen understanding of
shareholder governance expectations and the
Bachelor of Laws (Hons), Graduate Diploma in
Applied Finance and Investments, Graduate
Diploma in International Law and a Graduate
Diploma in Applied Corporate Governance. She is
also a member of the Australian Corporate
Lawyers Association (ACLA).
DIRECTORS’ MEETINGS
The number of Directors’ meetings which Directors were eligible to attend (including meetings of Board
Committees) and the number of meetings attended by each Director during the year were:
Board
Audit and Risk
Committee
Remuneration and
Nomination Committee
Eligible to
Attended
Eligible to
Attended
Eligible to
Attended
Attend
Attend
Attend
2
2
2
2
Ken Gillespie
Wayne Jones
Danny Hogan
11
11
11
10
11
11
8
Indoor Skydive Australia Group Limited
2016 Annual Report
8
Indoor Skydive Australia Group Limited
9
2016 Annual Report
2016 Annual Report |
Directors’ Report
Your Directors present their report on the
member of the Australian Institute of Company
consolidated entity (referred to hereafter as ISA
Directors.
Group) consisting of Indoor Skydive Australia
Group Limited (the Company) and the entities it
Danny Hogan MG
controlled at the end of, or during, the year ended
Director & Chief Operations Officer
30 June 2016.
DIRECTORS
The following individuals were Directors of the
Company at all times during the year and at the
date of this Directors’ Report, unless otherwise
stated:
Ken Gillespie AC, DSC, CSM
Chairman
Appointed 18 October 2012
Appointed 4 November 2011
Danny enlisted in the Australian Regular Army in
1991, and in 1997 was selected for further service
within the Special Air Service Regiment. He has
been recognised and awarded for his actions and
leadership during his 21 year military career
including receiving the Medal for Gallantry. He was
selected and completed a two year military
exchange in the USA with two of the USA’s elite
Special Forces Commands. While in the USA he
gained his freefall parachuting qualifications and
developed a very strong background in the use of
vertical wind tunnel simulation training. Danny
One of Australia’s most distinguished career
soldiers, Lieutenant General (retired) Ken Gillespie,
was a highly qualified senior dive instructor within
AC, DSC, CSM, is the Chairman of ISA Group.
During the year he was a member of the
the Special Air Service Regiment. Danny is a
member of the Australian Institute of Company
Remuneration & Nomination Committee and the
Directors.
Committee until 23 August 2016 when he stepped
Non-Executive Director
Stephen Baxter
Appointed 13 August 2012
Audit & Risk Committee. He was also the
Chairman of the Remuneration & Nomination
down from the chair although he remains a
member of the Remuneration & Nomination
Committee.
Ken is on the Board of Directors of leading local
defence manufacturer, Airbus Asia Pacific Group,
Former Regular Army electronics technician turned
successful entrepreneur, Steve is the founder of
early Internet Provider SE Net and co-founder of
telecommunications infrastructure company, Pipe
and ASX listed, Senetas Limited. He is also a council
Networks Ltd. In 2008 he moved to the USA and
member of the Australian Strategic Policy Institute,
joined Google Inc deploying high speed
an internationally recognised Canberra based think
telecommunication infrastructure, before
tank. Ken, who served with the Australian Defence
returning to Australia.
Force for over 43 years, was appointed Chief of
Army in July 2008, a position he held until his
Steve is a director of Vocus Communications
retirement in June 2011. Previously he had served
Limited (resigned 22 February 2016) and Other
as Land Commander Australia and Vice Chief of the
Levels Limited. He is also known for his
Australian Defence Force.
Wayne Jones
Director & Chief Executive Officer
Appointed 4 November 2011
entrepreneurial skills and appears on the popular
TV show “Shark Tank”. He is the founder of
Brisbane based not-for-profit River City Labs - an
early stage and start-up co-working space for tech
and creative companies.
Wayne served for 21 years in the Australian
Defence Force and was part of the highly
During the year Steve has been a member of the
Remuneration & Nomination Committee and
acclaimed Special Air Service Regiment for the last
Chairman of the Audit & Risk Committee. From 23
14 years of his career. Wayne holds various senior
August 2016 Steve has taken the role of Chairman
instructor qualifications and has been at the
forefront of Australian Military Freefall
of the Remuneration & Nomination Committee
and stepped down as Chairman of the Audit & Risk
development and training over the past 10 years.
Committee.
He is still involved in the training of special forces
troops and he continues to participate in the sport
of skydiving at the highest levels. Wayne is a
Directors’ Report
David Murray AO
Non-Executive Director
Appointed 3 February 2014
Former Chief Executive Officer of Commonwealth
Bank of Australia and Chairman of the Australian
Government Future Fund, David has over 40 years’
experience in banking and financial services. He
was appointed an Officer of the Order of Australia
in 2007 for services to the finance sector nationally
and internationally through strategic leadership
and policy development, to education through
fostering relations between educational
institutions, business and industry, and to the
community as a supporter and fundraiser. David is
Chairman of the Butterfly Foundation.
Kirsten Thomson
Non-Executive Director
Appointed 21 June 2016
Kirsten Thomson has over 20 years’ experience in
the fields of funds management and equities
research. She has demonstrated strong success in
a broad range of strategic challenges including
competing business models, challenging economic
cycles and differing and emerging commercial
approaches to doing business in Australia and
abroad.
Kirsten’s extensive experience with listed entities
has given her a deep understanding of the
essentials of business planning, management of
key performance indicators and financial
statements. She has a Masters of Finance and is a
graduate of the Australian Institute of Company
Directors. She also has a keen understanding of
shareholder governance expectations and the
DIRECTORS’ MEETINGS
requirements of the business and investment
communities.
From 23 August 2016 Kirsten has been appointed
as Chair of the Audit and Risk Committee and as a
member of the Nomination & Remuneration
Committee.
Malcolm Thompson
Former Alternative Director for Stephen Baxter
Appointed 13 February 2013
Resigned 21 June 2016
An accountant and governance specialist by
training, Malcolm has over 24 years’ experience
across technology, telecommunications, R&D and
aerospace industries in senior roles, including chief
financial officer, company secretary and director
roles. He has been instrumental in setting up
governance, financial and operational aspects for
listed companies and has assisted a local
subsidiary of Airbus NV (EPA:EAD) relating to $6B
construction and maintenance contracts for
advanced military helicopters.
COMPANY SECRETARY
Fiona Yiend
General Counsel & Company Secretary
Appointed 16 October 2013
Fiona Yiend is an experienced company secretary
with has over 7 years’ experience in the listed
environment. She holds a Bachelor of Arts,
Bachelor of Laws (Hons), Graduate Diploma in
Applied Finance and Investments, Graduate
Diploma in International Law and a Graduate
Diploma in Applied Corporate Governance. She is
also a member of the Australian Corporate
Lawyers Association (ACLA).
The number of Directors’ meetings which Directors were eligible to attend (including meetings of Board
Committees) and the number of meetings attended by each Director during the year were:
Board
Audit and Risk
Committee
Remuneration and
Nomination Committee
Eligible to
Attend
Attended
Eligible to
Attend
Attended
Eligible to
Attend
Attended
Ken Gillespie
Wayne Jones
Danny Hogan
11
11
11
10
11
11
2
2
2
2
Indoor Skydive Australia Group Limited
2016 Annual Report
8
Indoor Skydive Australia Group Limited
2016 Annual Report
9
9
| 2016 Annual Report
DIRECTORS’ REPORT Continued
Directors’ Report
Directors’ Report
2
2
2
2
Stephen Baxter
David Murray
Kirsten Thomson
Malcolm Thompson
11
11
1
1
8
8
1
2
DIRECTORS’ SHAREHOLDINGS
The following table sets out each Director’s relevant interest in shares and options in shares of ISA Group as at
the date of this report. No Director has any relevant interest in shares or options in shares of a related body
corporate of ISA Group as at the date of this report.
Director
Number of Shares and Nature of Interest
Ken Gillespie
Wayne Jones
Danny Hogan
Indirect interest in 396,668 shares held by Sector West Pty Ltd ATF Gillespie
Family Trust
Indirect interest in 16,060,000 shares held by Excalib-air Pty Ltd, indirect
interest in 200,000 shares held by Project Flight Pty Ltd ATF Wayne Jones
Superannuation Fund, indirect interest in 14,000 shares held by Project
Gravity Pty Ltd, indirect interest in 1,967,423 shares and 228,554
Performance Rights held by Project Gravity Pty Ltd ATF Jones Family Trust
Indirect interest in 16,060,000 shares held by Excalib-air Pty Ltd, indirect
interest in 200,000 shares held by Hogan Superannuation Fund, indirect
interest in 1,567,423 shares and 228,554 Performance Rights held by
Australian Indoor Skydiving Pty Ltd ATF Hogan Family Trust
Stephen Baxter
Indirect interest in 17,000,001 shares held by Birkdale Holdings (QLD) Pty Ltd
David Murray
Indirect interest in 2,521,667 shares held by Lyndcote Holdings Pty Ltd
Kirsten Thomson
Nil
DIVIDENDS
No dividends were declared during the period.
PRINCIPAL ACTIVITIES
ISA Group’s business is the operation and
development of indoor skydiving facilities.
ISA Group operates two facilities; iFLY Downunder
located at Penrith which is currently in its second
year of operations, and iFLY Gold Coast which
commenced operations on 6 February 2016.
Construction of our third facility, iFLY Perth is
continuing with the facility expected to open late
2016.
10
ISA Group’s development activities focused on
delivering our Australian tunnel roll out including
the completion of the Gold Coast, Queensland
facility and the construction of the Perth, Western
Australia facility. Negotiations with a number of
potential partners continue for our first Asian
facility and additional facilities in Australia.
REVIEW OF OPERATIONS
ISA Group’s operations continue to perform well
as the demand for indoor skydiving grows and our
operations become more efficient.
Our flagship operation, iFLY Downunder has
experienced increased retail and professional
sales, generating greater revenue than last year
and exceeding budget expectations. This was
partially offset by the delay in opening iFLY Gold
Indoor Skydive Australia Group Limited
2016 Annual Report
10
Coast and the increased cost of its construction.
REMUNERATION REPORT (AUDITED)
However, the commencement of the June school
holidays saw an increase in utilisation at iFLY Gold
The Remuneration Report is set out at page 13 and
Coast, which together with a focus on brand
recognition and driving awareness of the new
forms part of this Directors’ Report.
facility, positions iFLY Gold Coast for the upcoming
INTERESTS IN ISA GROUP SECURITIES
high tempo holiday season.
Indoor skydiving continues to grow as awareness
of the activity increases and flyers progress in the
sport. A trend of high utilisation during school
Details of the ISA Group securities issued during
the year and the number of ISA Group securities
on issue as at 30 June 2016 are detailed in Note 14
of the Financial Statements and form part of this
holiday periods has been established and occurs at
Directors’ Report.
both facilities.
Following the completion of our Gold Coast facility
are discussed in detail in the Remuneration
our construction focus has turned to the Perth
Report, ISA Group did not have any options on
facility. We are also in the process of negotiating
issue as at 30 June 2016.
additional opportunities with a number of
potential partners in Australia and South East Asia.
ENVIRONMENTAL REGULATION
With the exception of performance rights which
For the year ended 30 June 2016, ISA Group
reported earnings before interest, tax,
depreciation and amortisation excluding share
based payments of $159,928 (2015: $369,632).
ISA Group reported a net loss after tax of
$1,314,903 (2015: $1,903,921). This result takes
into account the effect of the Group being
required to carry additional operating costs for
iFLY Gold Coast as a consequence of the delayed
opening date. To fully understand our results,
please refer to the full financial statements
included in this Annual Report.
CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of
affairs of the Company during the financial year.
SUBSEQUENT EVENTS
of the consolidated group, the results of those
operations or the state of affairs of the
consolidated group in future financial years.
FUTURE DEVELOPMENTS
ISA Group continues to develop indoor skydiving
facilities with a focus on Australia and
opportunities in South East Asia and Hong Kong.
In the opinion of the Directors, disclosure of any
further information regarding business strategies
and future development of ISA Group would be
unreasonably prejudicial to the Company.
ISA Group is not subject to any significant
environment regulation under any law of the
Commonwealth or of a State or Territory.
DIRECTORS’ AND OFFICERS’ INSURANCE
During the financial year, ISA Group has paid
premiums to insure all Directors and Officers
against liabilities for costs and expenses incurred
by them in defending any legal proceedings arising
out of their conduct while acting in the capacity of
a director or officer of the Company, other than
conduct involving a wilful breach of duty in
relation to the Company. In accordance with
common commercial practice, the insurance policy
prohibits disclosure of the nature of the liability
insured against and the amount of the premium.
The Directors and Company Secretary of ISA Group
are also party to a deed of access and indemnity.
any related body corporate against a liability
incurred by such an officer or auditor.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the court under section
237 of the Corporations Act 2001 for leave to
bring, or intervene in, proceedings on behalf of
any entity within ISA Group.
No matters or circumstances have arisen since the
The Company has not otherwise, during or since
end of the financial year which significantly
the financial year, indemnified or agreed to
affected or may significantly affect the operations
indemnify an officer or auditor of the Company or
Indoor Skydive Australia Group Limited
2016 Annual Report
11
2016 Annual Report |
Directors’ Report
Coast and the increased cost of its construction.
However, the commencement of the June school
holidays saw an increase in utilisation at iFLY Gold
Coast, which together with a focus on brand
recognition and driving awareness of the new
facility, positions iFLY Gold Coast for the upcoming
high tempo holiday season.
Indoor skydiving continues to grow as awareness
of the activity increases and flyers progress in the
sport. A trend of high utilisation during school
holiday periods has been established and occurs at
both facilities.
Following the completion of our Gold Coast facility
our construction focus has turned to the Perth
facility. We are also in the process of negotiating
additional opportunities with a number of
potential partners in Australia and South East Asia.
For the year ended 30 June 2016, ISA Group
reported earnings before interest, tax,
depreciation and amortisation excluding share
based payments of $159,928 (2015: $369,632).
ISA Group reported a net loss after tax of
$1,314,903 (2015: $1,903,921). This result takes
into account the effect of the Group being
required to carry additional operating costs for
iFLY Gold Coast as a consequence of the delayed
opening date. To fully understand our results,
please refer to the full financial statements
included in this Annual Report.
CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of
affairs of the Company during the financial year.
SUBSEQUENT EVENTS
No matters or circumstances have arisen since the
end of the financial year which significantly
affected or may significantly affect the operations
of the consolidated group, the results of those
operations or the state of affairs of the
consolidated group in future financial years.
REVIEW OF OPERATIONS
FUTURE DEVELOPMENTS
ISA Group continues to develop indoor skydiving
facilities with a focus on Australia and
opportunities in South East Asia and Hong Kong.
In the opinion of the Directors, disclosure of any
further information regarding business strategies
and future development of ISA Group would be
unreasonably prejudicial to the Company.
2
2
2
2
Directors’ Report
Stephen Baxter
David Murray
Kirsten Thomson
Malcolm Thompson
11
11
1
1
DIRECTORS’ SHAREHOLDINGS
8
8
1
2
The following table sets out each Director’s relevant interest in shares and options in shares of ISA Group as at
the date of this report. No Director has any relevant interest in shares or options in shares of a related body
corporate of ISA Group as at the date of this report.
Director
Number of Shares and Nature of Interest
Ken Gillespie
Indirect interest in 396,668 shares held by Sector West Pty Ltd ATF Gillespie
Family Trust
Wayne Jones
Indirect interest in 16,060,000 shares held by Excalib-air Pty Ltd, indirect
interest in 200,000 shares held by Project Flight Pty Ltd ATF Wayne Jones
Superannuation Fund, indirect interest in 14,000 shares held by Project
Gravity Pty Ltd, indirect interest in 1,967,423 shares and 228,554
Performance Rights held by Project Gravity Pty Ltd ATF Jones Family Trust
Danny Hogan
Indirect interest in 16,060,000 shares held by Excalib-air Pty Ltd, indirect
interest in 200,000 shares held by Hogan Superannuation Fund, indirect
interest in 1,567,423 shares and 228,554 Performance Rights held by
Australian Indoor Skydiving Pty Ltd ATF Hogan Family Trust
Stephen Baxter
Indirect interest in 17,000,001 shares held by Birkdale Holdings (QLD) Pty Ltd
David Murray
Indirect interest in 2,521,667 shares held by Lyndcote Holdings Pty Ltd
Kirsten Thomson
Nil
DIVIDENDS
No dividends were declared during the period.
PRINCIPAL ACTIVITIES
ISA Group’s business is the operation and
development of indoor skydiving facilities.
ISA Group operates two facilities; iFLY Downunder
located at Penrith which is currently in its second
year of operations, and iFLY Gold Coast which
commenced operations on 6 February 2016.
Construction of our third facility, iFLY Perth is
continuing with the facility expected to open late
2016.
ISA Group’s development activities focused on
delivering our Australian tunnel roll out including
the completion of the Gold Coast, Queensland
facility and the construction of the Perth, Western
Australia facility. Negotiations with a number of
potential partners continue for our first Asian
facility and additional facilities in Australia.
ISA Group’s operations continue to perform well
as the demand for indoor skydiving grows and our
operations become more efficient.
Our flagship operation, iFLY Downunder has
experienced increased retail and professional
sales, generating greater revenue than last year
and exceeding budget expectations. This was
partially offset by the delay in opening iFLY Gold
Indoor Skydive Australia Group Limited
10
2016 Annual Report
REMUNERATION REPORT (AUDITED)
The Remuneration Report is set out at page 13 and
forms part of this Directors’ Report.
INTERESTS IN ISA GROUP SECURITIES
Details of the ISA Group securities issued during
the year and the number of ISA Group securities
on issue as at 30 June 2016 are detailed in Note 14
of the Financial Statements and form part of this
Directors’ Report.
With the exception of performance rights which
are discussed in detail in the Remuneration
Report, ISA Group did not have any options on
issue as at 30 June 2016.
ENVIRONMENTAL REGULATION
ISA Group is not subject to any significant
environment regulation under any law of the
Commonwealth or of a State or Territory.
DIRECTORS’ AND OFFICERS’ INSURANCE
During the financial year, ISA Group has paid
premiums to insure all Directors and Officers
against liabilities for costs and expenses incurred
by them in defending any legal proceedings arising
out of their conduct while acting in the capacity of
a director or officer of the Company, other than
conduct involving a wilful breach of duty in
relation to the Company. In accordance with
common commercial practice, the insurance policy
prohibits disclosure of the nature of the liability
insured against and the amount of the premium.
The Directors and Company Secretary of ISA Group
are also party to a deed of access and indemnity.
The Company has not otherwise, during or since
the financial year, indemnified or agreed to
indemnify an officer or auditor of the Company or
any related body corporate against a liability
incurred by such an officer or auditor.
PROCEEDINGS ON BEHALF OF THE COMPANY
No person has applied to the court under section
237 of the Corporations Act 2001 for leave to
bring, or intervene in, proceedings on behalf of
any entity within ISA Group.
Indoor Skydive Australia Group Limited
2016 Annual Report
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Directors’ Report
DIRECTORS’ REPORT Continued
AUDITOR
RSM Australia Partners continues in office as
auditor in accordance with section 327 of the
Corporations Act 2001.
NON-AUDIT SERVICES
The Directors, in accordance with advice from the
Audit & Risk Committee, are satisfied that the
provision of non-audit services during the year is
standard of
compatible with
independence
the
Corporations Act 2001. The Directors are satisfied
that
the services disclosed below did not
compromise the external auditor’s independence
for the following reasons:
the general
for auditors
imposed by
-
-
all non-audit services are reviewed and
approved by the Audit & Risk committee
prior to commencement to ensure they do
not adversely affect the integrity and
objectivity of the auditor; and
the nature of the services provided does
not compromise the general principles
relating to auditor independence in
accordance with APES 110: Code of Ethics
for Professional Accountants set by the
Accounting Professional and Ethical
Standards Board.
The fees paid or payable to RSM Australia Partners
for non-audit services provided during the year
ended 30 June 2016 were $3,450.
AUDITOR’S INDEPENDENCE DECLARATION
The Auditor’s independence declaration is set out
at page 25 and forms part of this Directors’ Report.
ROUNDING OF AMOUNTS
ISA Group is not an entity to which ASIC class order
98/100 applies. Accordingly, amounts in the
financial statements and annual reports have been
rounded to the nearest dollar not the nearest
thousand dollars.
BUY BACK
ISA Group does not currently have any on-market
buy-back of shares.
This Directors’ Report is made in accordance with a resolution of the directors made pursuant to section 298(2)
of the Corporations Act.
On behalf of the Board
Ken Gillespie
Chairman
23 August 2016
Sydney
Wayne Jones
Director & Chief Executive Officer
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2016 Annual Report
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2016 Annual Report |
The Directors, in accordance with advice from the
Audit & Risk Committee, are satisfied that the
ROUNDING OF AMOUNTS
The fees paid or payable to RSM Australia Partners
for non-audit services provided during the year
ended 30 June 2016 were $3,450.
AUDITOR’S INDEPENDENCE DECLARATION
The Auditor’s independence declaration is set out
at page 25 and forms part of this Directors’ Report.
ISA Group is not an entity to which ASIC class order
98/100 applies. Accordingly, amounts in the
financial statements and annual reports have been
rounded to the nearest dollar not the nearest
thousand dollars.
BUY BACK
ISA Group does not currently have any on-market
buy-back of shares.
Directors’ Report
AUDITOR
RSM Australia Partners continues in office as
auditor in accordance with section 327 of the
Corporations Act 2001.
NON-AUDIT SERVICES
provision of non-audit services during the year is
compatible with
the general
standard of
independence
for auditors
imposed by
the
Corporations Act 2001. The Directors are satisfied
that
the services disclosed below did not
compromise the external auditor’s independence
for the following reasons:
-
-
all non-audit services are reviewed and
approved by the Audit & Risk committee
prior to commencement to ensure they do
not adversely affect the integrity and
objectivity of the auditor; and
the nature of the services provided does
not compromise the general principles
relating to auditor independence in
accordance with APES 110: Code of Ethics
for Professional Accountants set by the
Accounting Professional and Ethical
Standards Board.
of the Corporations Act.
On behalf of the Board
This Directors’ Report is made in accordance with a resolution of the directors made pursuant to section 298(2)
Ken Gillespie
Chairman
23 August 2016
Sydney
Wayne Jones
Director & Chief Executive Officer
Indoor Skydive Australia Group Limited
2016 Annual Report
12
REMUNERATION
REPORT
(AUDITED)
Remuneration Report
REMUNERATION REPORT (Audited)
Dear Shareholder
The ISA Group Board of Directors presents the 2015-2016 Remuneration Report. This report sets out the
remuneration outcomes for 2015-2016.
Over the last 3 years ISA Group has been progressively restructuring its remuneration in line with the
Company’s growth to a multi-facility operation. This process was completed in the 2015-2016 financial year
which has seen fixed remuneration level reach acceptable market levels based on our size, position and
operating structure, increased the proportion of ‘at risk’ remuneration across our executive team and reduced
our reliance on performance rights as a short/medium term retention tool.
Similarly, the incentives entered into with the Founding Directors under their initial employment in 2012 are
nearing completion with the last hurdle to be assessed. These incentives were provided to drive the
establishment and early operations of our first indoor skydiving facility (iFLY Downunder) and to task the
Founding Directors to grow the operations from a single facility operation to a multi-facility business. Moving
forward the Founding Directors incentives will be aligned with other ISA Group executives and tied to targets
considered appropriate to facilitate our strategic goals.
ISA Group is now a multi-facility operation following the opening of our second indoor skydiving facility (iFLY
Gold Coast). Further growth is imminent with iFLY Perth nearing completion and a number of exciting
opportunities, both here and internationally being considered. We have structured our remuneration strategy
bearing in mind the strong growth focus of the Company and the expansion strategy being considered with a
focus on retaining key executives as we operate a unique Australian business.
I trust that the Company’s remuneration strategy will receive your support. We welcome your feedback.
Yours sincerely
Ken Gillespie
Chairman of the Board and
Remuneration & Nomination Committee
1.
Introduction
Remuneration Report
Remuneration & Nomination Committee (Committee)
The role of the Committee is to assist and advise the Board on matters relating to the appointment and
remuneration of directors, executives and where appropriate, other employees of ISA Group.
The Committee operates under the Remuneration & Nomination Committee Charter that is available on the
ISA Group website: www.indoorskydive.com.au.The Committee consists of non-executive directors only.
The Board approves, based on recommendation from the Committee, all remuneration decisions and
outcomes for the executive directors (including the CEO), and all executives who report directly to the CEO.
The CEO approves short term incentives and increases to remuneration for executives who report to his direct
reports.
Remuneration Recommendations
ISA Group has engaged independent external remuneration consultants to provide advice and assistance to
the Remuneration & Nomination Committee from time to time. No remuneration recommendations from
independent remuneration advisors were received during the 2015-2016 financial year.
Hedging of Remuneration
ISA Group KMP and their closely related parties are prohibited from hedging or otherwise reducing or
eliminating the risk associated with equity based incentives.
3. Key Management Personnel
The KMP for ISA Group for 2015-16 comprise the Non-Executive Directors, Executive Directors and the senior
executives responsible for planning, directing and controlling the activities of ISA Group.
Executive KMP
Non-Executive Directors:
Wayne Jones
Executive Director & Chief
Ken Gillespie
Chair
Executive Office
Danny Hogan
Executive Director & Chief
Operations Officer
David Murray
Director
Stephen Baxter
Director
Stephen Burns
Chief Financial Officer
Kirsten Thomson
Director
Brett Sheridan
Chief Commercial Officer
Former Director:
Fiona Yiend
General Counsel & Company
Malcolm Thompson
Alternative Director until
Secretary
21 June 2016
This Remuneration Report for the year ended 30 June 2016 forms part of the ISA Group Directors’ Report and
has been audited in accordance with the Corporations Act 2001.
A short profile of the Executive KMP follows:
The Remuneration Report details remuneration information for the Key Management Personnel of ISA Group
(KMP) comprising the Non-Executive Directors, Executive Directors and the senior executives responsible for
planning, directing and controlling the activities of ISA Group.
2. Remuneration Governance
ISA Group’s remuneration strategy, policies and practices are designed to support the operational demands of
the Group while fairly rewarding employees. The Board, in conjunction with the Remuneration & Nomination
Committee provides guidance on remuneration strategy and has oversight of remuneration policies and
practices.
Wayne Jones
Wayne Jones is the Chief Executive Officer of ISA Group and was appointed to the role on the
Director & Chief
foundation of the company in November 2011. He has been one of the key forces behind the
Executive Officer
successful establishment of ISA Group.
Wayne holds formal qualifications in Project Management, Business, Security and Risk
Management and Management (Financial Management) and is a Member of the Australian
Institute of Company Directors. He has over 21 years’ experience in leading teams and
delivering results. Prior to establishing ISA Group Wayne was a Commander with the SASR
Operations and responsible for the development and performance of teams in changing
environments.
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2016 Annual Report
2016 Annual Report |
Remuneration Report
Dear Shareholder
The ISA Group Board of Directors presents the 2015-2016 Remuneration Report. This report sets out the
remuneration outcomes for 2015-2016.
Over the last 3 years ISA Group has been progressively restructuring its remuneration in line with the
Company’s growth to a multi-facility operation. This process was completed in the 2015-2016 financial year
which has seen fixed remuneration level reach acceptable market levels based on our size, position and
operating structure, increased the proportion of ‘at risk’ remuneration across our executive team and reduced
our reliance on performance rights as a short/medium term retention tool.
Similarly, the incentives entered into with the Founding Directors under their initial employment in 2012 are
nearing completion with the last hurdle to be assessed. These incentives were provided to drive the
establishment and early operations of our first indoor skydiving facility (iFLY Downunder) and to task the
Founding Directors to grow the operations from a single facility operation to a multi-facility business. Moving
forward the Founding Directors incentives will be aligned with other ISA Group executives and tied to targets
considered appropriate to facilitate our strategic goals.
ISA Group is now a multi-facility operation following the opening of our second indoor skydiving facility (iFLY
Gold Coast). Further growth is imminent with iFLY Perth nearing completion and a number of exciting
opportunities, both here and internationally being considered. We have structured our remuneration strategy
bearing in mind the strong growth focus of the Company and the expansion strategy being considered with a
focus on retaining key executives as we operate a unique Australian business.
I trust that the Company’s remuneration strategy will receive your support. We welcome your feedback.
Yours sincerely
Ken Gillespie
Chairman of the Board and
Remuneration & Nomination Committee
1.
Introduction
Remuneration Report
Remuneration & Nomination Committee (Committee)
The role of the Committee is to assist and advise the Board on matters relating to the appointment and
remuneration of directors, executives and where appropriate, other employees of ISA Group.
The Committee operates under the Remuneration & Nomination Committee Charter that is available on the
ISA Group website: www.indoorskydive.com.au.The Committee consists of non-executive directors only.
The Board approves, based on recommendation from the Committee, all remuneration decisions and
outcomes for the executive directors (including the CEO), and all executives who report directly to the CEO.
The CEO approves short term incentives and increases to remuneration for executives who report to his direct
reports.
Remuneration Recommendations
ISA Group has engaged independent external remuneration consultants to provide advice and assistance to
the Remuneration & Nomination Committee from time to time. No remuneration recommendations from
independent remuneration advisors were received during the 2015-2016 financial year.
Hedging of Remuneration
ISA Group KMP and their closely related parties are prohibited from hedging or otherwise reducing or
eliminating the risk associated with equity based incentives.
3. Key Management Personnel
The KMP for ISA Group for 2015-16 comprise the Non-Executive Directors, Executive Directors and the senior
executives responsible for planning, directing and controlling the activities of ISA Group.
Executive KMP
Wayne Jones
Executive Director & Chief
Executive Office
Danny Hogan
Executive Director & Chief
Operations Officer
Non-Executive Directors:
Ken Gillespie
Chair
Stephen Baxter
Director
David Murray
Director
Stephen Burns
Chief Financial Officer
Kirsten Thomson
Director
Brett Sheridan
Chief Commercial Officer
Former Director:
Fiona Yiend
General Counsel & Company
Secretary
Malcolm Thompson
Alternative Director until
21 June 2016
This Remuneration Report for the year ended 30 June 2016 forms part of the ISA Group Directors’ Report and
has been audited in accordance with the Corporations Act 2001.
A short profile of the Executive KMP follows:
The Remuneration Report details remuneration information for the Key Management Personnel of ISA Group
(KMP) comprising the Non-Executive Directors, Executive Directors and the senior executives responsible for
planning, directing and controlling the activities of ISA Group.
2. Remuneration Governance
ISA Group’s remuneration strategy, policies and practices are designed to support the operational demands of
the Group while fairly rewarding employees. The Board, in conjunction with the Remuneration & Nomination
Committee provides guidance on remuneration strategy and has oversight of remuneration policies and
practices.
Wayne Jones
Director & Chief
Executive Officer
Wayne Jones is the Chief Executive Officer of ISA Group and was appointed to the role on the
foundation of the company in November 2011. He has been one of the key forces behind the
successful establishment of ISA Group.
Wayne holds formal qualifications in Project Management, Business, Security and Risk
Management and Management (Financial Management) and is a Member of the Australian
Institute of Company Directors. He has over 21 years’ experience in leading teams and
delivering results. Prior to establishing ISA Group Wayne was a Commander with the SASR
Operations and responsible for the development and performance of teams in changing
environments.
Indoor Skydive Australia Group Limited
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2016 Annual Report
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2016 Annual Report
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Remuneration Report
REMUNERATION REPORT (Audited) Continued
Remuneration Report
•
•
Align rewards with business performance – ISA Group seeks to align remuneration rewards with
business performance through the use of “at risk” remuneration.
Support the execution of business strategy – ISA Group seeks to motivate employees to execute our
aggressive growth strategy by setting performance objectives in line with strategic outcomes.
Remuneration Strategy
Over the last three years ISA Group has been implementing a staged remuneration strategy to bring our
remuneration levels in line with a comparator group of ASX listed companies of comparable operational scope
and size to ISA Group. The 2015-2016 year was the final stage of this strategy. As a result, ISA Group’s
remuneration from 2015-2016 reflects a more traditional mix of fixed and ‘at risk’ components and
incorporates market level remuneration.
The following table sets out the mix of remuneration types and their alignment to our remuneration strategy:
Fixed Remuneration
Short-Term Incentive (STI)
Long Term Incentive (LTI)
Consists of …
Base salary
Annual cash payment
Participation in the ISA
subject to the
Group Performance Rights
achievement of financial
Plan
targets
Rewards for…
Experience, skills and
Financial performance
Tenure over a long term
capability
over a 12-month period
period
Is..
Fixed
At Risk
At Risk
Reviewed annually
Wholly dependent on
achieving set financial
targets
Wholly dependent on
achieving set tenure
requirements
Determined by
Review of individual
Performance against
Retention of individual over
against comparative
defined financial targets.
a course of time.
roles, individual
performance and
experience and
capability
STI is only payable if the
financial targets are
achieved
Danny Hogan
Director & Chief
Operations
Officer
Danny Hogan is the Chief Operations Officer of ISA Group and a founder of the company. His
primary responsibilities are the Company’s operations including the designing, development
and construction of our indoor skydiving facilities.
Danny is a Member of the Australian Institute of Company Directors and is qualified in Military
Freefall Parachuting Operations and was a highly qualified senior dive instructor within the
Special Air Service Regiment. Prior to establishing ISA Group Danny was a highly decorated
member of the SASR Operations and received the distinguished Medal of Gallantry. Danny has
proven expertise in VWT operations and the ability to lead teams and manage complex
environments.
Stephen Burns
Chief Financial
Officer
Stephen Burns is a professional accountant (CPA) with extensive experience in developing and
maintaining strong governance and cost control regimes within large organisations in
challenging environments.
Most recently Stephen was the CFO of a Telecommunications and Manufacturing business
based in Brisbane. Prior to that Stephen was the Director of Business Controlling within the
local subsidiary of what is now Airbus Group (the second largest aircraft manufacturer
worldwide) and was responsible for the financial oversight and governance of over $6Billion
worth of contracts.
Brett Sheridan
Chief Commercial
Officer
Brett Sheridan joined ISA Group in May 2013 in the role of Chief Marketing Officer and became
the Chief Commercial Officer in July 2016. Prior to that time, Brett provided ISA Group with
contracting services and has been involved with the Company since its inception. Brett is
responsible for driving customer demand, increasing brand recognition and analysing market
opportunities as well as driving future growth and the strategic direction of the Company.
Brett is an experienced marketer with over 15 years association with the tourism and leisure
industry and over 10 years of entrepreneurial experience. Brett’s key expertise is to deliver
business growth which he has proven repeatedly in the past.
Fiona Yiend
General Counsel
& Company
Secretary
Fiona Yiend joined ISA Group in September 2013 as General Counsel and Company Secretary.
She is responsible for managing ISA Group’s legal matters, corporate governance and board
administration.
Fiona holds a Graduate Diploma of Applied Corporate Governance from the Governance
Institute of Australia (formerly Chartered Secretaries Australia), Graduate Diplomas in
International Law and in Applied Finance and Investment and a Bachelor of Laws (second class
honours) and Bachelor of Arts. Fiona’s formal qualifications are complemented by over 7
years’ experience as General Counsel and Company Secretary of ASX listed entities.
Profiles of Non-Executive Directors can be found on pages 8 to 9.
4. Remuneration Principles, Strategy and Outcomes
Remuneration principles
ISA Group’s approach to remuneration reflects both the strategic and growth goals of the company, its
operational requirements and the dynamic environment in which it operates. As ISA Group has transitioned
into a more mature multi-facility operation our remuneration principles have evolved.
A number of principles underpin our remuneration policy:
•
Retain Top Talent – As ISA Group operates in a unique environment with a limited pool of talent ISA
Group seeks to retain the high calibre people it has identified.
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2016 Annual Report |
Remuneration Report
Remuneration Report
•
•
Align rewards with business performance – ISA Group seeks to align remuneration rewards with
business performance through the use of “at risk” remuneration.
Support the execution of business strategy – ISA Group seeks to motivate employees to execute our
aggressive growth strategy by setting performance objectives in line with strategic outcomes.
Remuneration Strategy
Over the last three years ISA Group has been implementing a staged remuneration strategy to bring our
remuneration levels in line with a comparator group of ASX listed companies of comparable operational scope
and size to ISA Group. The 2015-2016 year was the final stage of this strategy. As a result, ISA Group’s
remuneration from 2015-2016 reflects a more traditional mix of fixed and ‘at risk’ components and
incorporates market level remuneration.
The following table sets out the mix of remuneration types and their alignment to our remuneration strategy:
Fixed Remuneration
Short-Term Incentive (STI)
Long Term Incentive (LTI)
Consists of …
Base salary
Annual cash payment
subject to the
achievement of financial
targets
Participation in the ISA
Group Performance Rights
Plan
Rewards for…
Experience, skills and
capability
Financial performance
over a 12-month period
Tenure over a long term
period
Is..
Fixed
At Risk
At Risk
Fiona Yiend
Fiona Yiend joined ISA Group in September 2013 as General Counsel and Company Secretary.
General Counsel
She is responsible for managing ISA Group’s legal matters, corporate governance and board
Determined by
& Company
Secretary
administration.
Fiona holds a Graduate Diploma of Applied Corporate Governance from the Governance
Institute of Australia (formerly Chartered Secretaries Australia), Graduate Diplomas in
International Law and in Applied Finance and Investment and a Bachelor of Laws (second class
honours) and Bachelor of Arts. Fiona’s formal qualifications are complemented by over 7
years’ experience as General Counsel and Company Secretary of ASX listed entities.
Reviewed annually
Wholly dependent on
achieving set financial
targets
Wholly dependent on
achieving set tenure
requirements
Review of individual
against comparative
roles, individual
performance and
experience and
capability
Performance against
defined financial targets.
STI is only payable if the
financial targets are
achieved
Retention of individual over
a course of time.
Danny Hogan
Danny Hogan is the Chief Operations Officer of ISA Group and a founder of the company. His
Director & Chief
primary responsibilities are the Company’s operations including the designing, development
Operations
Officer
and construction of our indoor skydiving facilities.
Danny is a Member of the Australian Institute of Company Directors and is qualified in Military
Freefall Parachuting Operations and was a highly qualified senior dive instructor within the
Special Air Service Regiment. Prior to establishing ISA Group Danny was a highly decorated
member of the SASR Operations and received the distinguished Medal of Gallantry. Danny has
proven expertise in VWT operations and the ability to lead teams and manage complex
environments.
Stephen Burns
Chief Financial
Officer
challenging environments.
Stephen Burns is a professional accountant (CPA) with extensive experience in developing and
maintaining strong governance and cost control regimes within large organisations in
Most recently Stephen was the CFO of a Telecommunications and Manufacturing business
based in Brisbane. Prior to that Stephen was the Director of Business Controlling within the
local subsidiary of what is now Airbus Group (the second largest aircraft manufacturer
worldwide) and was responsible for the financial oversight and governance of over $6Billion
worth of contracts.
Brett Sheridan
Brett Sheridan joined ISA Group in May 2013 in the role of Chief Marketing Officer and became
Chief Commercial
the Chief Commercial Officer in July 2016. Prior to that time, Brett provided ISA Group with
Officer
contracting services and has been involved with the Company since its inception. Brett is
responsible for driving customer demand, increasing brand recognition and analysing market
opportunities as well as driving future growth and the strategic direction of the Company.
Brett is an experienced marketer with over 15 years association with the tourism and leisure
industry and over 10 years of entrepreneurial experience. Brett’s key expertise is to deliver
business growth which he has proven repeatedly in the past.
Profiles of Non-Executive Directors can be found on pages 8 to 9.
4. Remuneration Principles, Strategy and Outcomes
Remuneration principles
ISA Group’s approach to remuneration reflects both the strategic and growth goals of the company, its
operational requirements and the dynamic environment in which it operates. As ISA Group has transitioned
into a more mature multi-facility operation our remuneration principles have evolved.
A number of principles underpin our remuneration policy:
•
Retain Top Talent – As ISA Group operates in a unique environment with a limited pool of talent ISA
Group seeks to retain the high calibre people it has identified.
Indoor Skydive Australia Group Limited
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2016 Annual Report
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Remuneration Report
REMUNERATION REPORT (Audited) Continued
Remuneration Report
Remuneration Outcomes for Executive KMP
The remuneration received by Executive KMP in 2015-2016 is set out below, including a comparison with the
2014-2015 period.
Short Term Incentive Structure
The key features of ISA Group’s STI Plan are outlined below:
What is the purpose of the STI?
Short Term Benefits
Post
Employment
Benefits
Long
Term
Benefits
KMP
Year
Salary
STI
Wayne Jones
CEO
2016
$
207,995
Danny Hogan
COO
2015
189,465
2016
207,995
2015
189,465
Stephen Burns
CFO
2016
176,105
2015
145,961
Brett Sheridan
CMO
2016
177,692
2015
164,827
Fiona Yiend
GC/CS
2016
130,477
2015
164,827
$
-
-
-
-
-
-
-
-
-
-
Non
Mone-
tary
$
12,674
Super-
annuation
$
19,760
8,151
18,000
18,276
19,760
8,887
18,000
-
-
16,730
13,866
8,097
16,880
3,721
15,659
6,338
12,395
-
15,659
Long
Service
Leave
$
-
-
-
-
-
-
-
-
-
-
Share
Based
Payments
Rights
Total
Other
Term-
ination
$
-
$
236,918
$
477,347
-
-
-
-
-
-
-
-
-
445,240
660,856
What are the performance conditions?
236,918
482,949
445,240
661,592
-
192,835
39,950
199,777
-
-
-
202,669
184,207
149,210
57,392
237,878
Executive Remuneration Structure
Remuneration Mix
Fixed annual remuneration provides a “base” level of remuneration. Short and long-term variable incentives
(“at risk”) reward executives for meeting and exceeding pre-determined targets. This structure links variable
reward to targets which the Company considers are significant for our growth plan.
The percentage of at risk remuneration varies between executives based on the extent to which they are in a
position to directly influence company performance. As a result, the executive directors at risk remuneration
comprises short term incentives of 40% of base salary at risk each financial year plus long term incentives at
risk over a three year period. Other executives have short term incentives of up to 30% of their base at risk
each financial year in addition to long term incentives at risk over a three year period.
Fixed Remuneration
Fixed remuneration is comprised of cash salary and superannuation and other limited non-monetary benefits.
The levels are set to attract and retain qualified, skilled and experienced executives and are determined based
on comparable market data, the skills and experience of the individual executive and the accountability and
responsibility of the role.
An independent external remuneration review in 2013 identified that ISA Group Executive KMP remuneration
was within the bottom quartile compared to its comparator group. Since then ISA Group has been moving
towards fixed remuneration more aligned to the median for fixed remuneration in the comparator group.
When and how is it reviewed?
Who assesses performance against targets?
The targets are objective financial measures which
What are the clawback provisions?
None
Short term Incentive Outcomes
For 2015-2016, the STI targets were not met. All Executive KMP forfeited 100% of their STI award.
Long Term Incentive Structure
The key features of the ISA Group Long Term Incentive (LTI) are outlined below:
What is the purpose of the LTI?
The LTI drives executives to achieve certain outcomes
that are considered important to the growth of the ISA
Group.
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Who participates?
All Executive KMP and selected senior executives.
How much can be earned under the STI Plan?
The target STI opportunity for KMP is between 15%
Over what period is it measured?
Performance is measured over the 12 month period
How is it paid?
STI performance targets drive executives to focus on
achieving ISA Group’s performance goals and
rewards executives for achieving or exceeding those
goals.
to 20% of base salary depending on the role. For
stretch/over performance, KMP have the ability to
earn an additional 15% to 20% of base salary.
No STI is payable unless minimum financial targets
relating to Group EBITDA are achieved. The Stretch
target is also measured against EBITDA.
from 1 July to 30 June.
STI payments are made on the achievement of
reaching targets (ie payments are not made
progressively). If targets are reached the full STI is
paid. If the target is achieved but the stretch target
is not, no payment or partial payment is made for
exceeding the target.
The Executive must be an employee and not
servicing out a notice period when the payment of
an STI is made.
Payment occurs after conclusion of the end of year
audit (usually September).
The STI is reviewed annually in line with the review
of remuneration and the review of budgets.
are assessed against the Company’s audited
financial accounts. The Board approves all STI
assessments and payments.
2016 Annual Report |
Remuneration Report
Remuneration Outcomes for Executive KMP
Remuneration Report
Short Term Incentive Structure
The key features of ISA Group’s STI Plan are outlined below:
The remuneration received by Executive KMP in 2015-2016 is set out below, including a comparison with the
2014-2015 period.
What is the purpose of the STI?
Short Term Benefits
Benefits
Benefits
Other
Payments
Post
Employment
Long
Term
Share
Based
STI performance targets drive executives to focus on
achieving ISA Group’s performance goals and
rewards executives for achieving or exceeding those
goals.
Who participates?
All Executive KMP and selected senior executives.
KMP
Year
Salary
STI
Super-
annuation
Long
Term-
Service
ination
Rights
Total
How much can be earned under the STI Plan?
Wayne Jones
2016
207,995
12,674
19,760
$
$
$
$
$
236,918
477,347
2015
189,465
8,151
18,000
445,240
660,856
What are the performance conditions?
Danny Hogan
2016
207,995
18,276
19,760
236,918
482,949
2015
189,465
8,887
18,000
445,240
661,592
Over what period is it measured?
2015
145,961
39,950
199,777
How is it paid?
Stephen Burns
CFO
2016
176,105
-
-
16,730
13,866
Brett Sheridan
2016
177,692
8,097
16,880
2015
164,827
3,721
15,659
Fiona Yiend
2016
130,477
6,338
12,395
-
-
-
-
192,835
202,669
184,207
149,210
2015
164,827
-
15,659
57,392
237,878
Non
Mone-
tary
$
$
-
-
-
-
-
-
-
-
-
-
Leave
$
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
CEO
COO
CMO
GC/CS
When and how is it reviewed?
Who assesses performance against targets?
The target STI opportunity for KMP is between 15%
to 20% of base salary depending on the role. For
stretch/over performance, KMP have the ability to
earn an additional 15% to 20% of base salary.
No STI is payable unless minimum financial targets
relating to Group EBITDA are achieved. The Stretch
target is also measured against EBITDA.
Performance is measured over the 12 month period
from 1 July to 30 June.
STI payments are made on the achievement of
reaching targets (ie payments are not made
progressively). If targets are reached the full STI is
paid. If the target is achieved but the stretch target
is not, no payment or partial payment is made for
exceeding the target.
The Executive must be an employee and not
servicing out a notice period when the payment of
an STI is made.
Payment occurs after conclusion of the end of year
audit (usually September).
The STI is reviewed annually in line with the review
of remuneration and the review of budgets.
The targets are objective financial measures which
are assessed against the Company’s audited
financial accounts. The Board approves all STI
assessments and payments.
What are the clawback provisions?
None
Short term Incentive Outcomes
For 2015-2016, the STI targets were not met. All Executive KMP forfeited 100% of their STI award.
Long Term Incentive Structure
The key features of the ISA Group Long Term Incentive (LTI) are outlined below:
What is the purpose of the LTI?
The LTI drives executives to achieve certain outcomes
that are considered important to the growth of the ISA
Group.
Indoor Skydive Australia Group Limited
2016 Annual Report
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Indoor Skydive Australia Group Limited
2016 Annual Report
19
19
Executive Remuneration Structure
Remuneration Mix
Fixed annual remuneration provides a “base” level of remuneration. Short and long-term variable incentives
(“at risk”) reward executives for meeting and exceeding pre-determined targets. This structure links variable
reward to targets which the Company considers are significant for our growth plan.
The percentage of at risk remuneration varies between executives based on the extent to which they are in a
position to directly influence company performance. As a result, the executive directors at risk remuneration
comprises short term incentives of 40% of base salary at risk each financial year plus long term incentives at
risk over a three year period. Other executives have short term incentives of up to 30% of their base at risk
each financial year in addition to long term incentives at risk over a three year period.
Fixed Remuneration
Fixed remuneration is comprised of cash salary and superannuation and other limited non-monetary benefits.
The levels are set to attract and retain qualified, skilled and experienced executives and are determined based
on comparable market data, the skills and experience of the individual executive and the accountability and
responsibility of the role.
An independent external remuneration review in 2013 identified that ISA Group Executive KMP remuneration
was within the bottom quartile compared to its comparator group. Since then ISA Group has been moving
towards fixed remuneration more aligned to the median for fixed remuneration in the comparator group.
| 2016 Annual Report
Remuneration Report
REMUNERATION REPORT (Audited) Continued
Remuneration Report
are forfeited, or where the shares issued to the
performance rights have been sold require the
participant to pay to ISA Group all or part of the net
proceeds of sale.
Long Term Incentive Awards
Details of the equity instruments, comprising performance rights, provided as remuneration to each KMP in
the 2015-2016 financial year is set out below. When vested, each performance rights will entitle the holder to
one ordinary ISA Group share. Performance Rights will vest only if applicable performance hurdles are satisfied
Number of Performance
Number of Rights Vested
Rights Awarded during 2015-
during 2015-2016
in the relevant performance period.
Name
Executive Founding Directors
Other Key Management Personnel
Wayne Jones
Danny Hogan
Brett Sheridan
Stephen Burns
Fiona Yiend
LTI Outcomes
2016
620,409
620,409
129,054
129,054
129,054
391,855
391,855
135,000
85,000
85,000
During 2015-2016 ISA Group’s second indoor skydiving facility, iFLY Gold Coast, opened resulting in the
satisfaction of one of the milestone hurdles for the Executive Founding Directors. As a result, performance
rights were issued and vested for the Executive Founding Directors.
Retention based awards also vested during the year. As a result, performance rights issued to Brett Sheridan,
Stephen Burns and Fiona Yiend in prior years vested during the year. Details of these are set out above.
Who participates?
What is the vehicle?
What are the performance conditions and
what is the performance period?
How is it paid?
How are performance conditions set?
What happens if a change of control occurs?
What are the clawback provisions?
Participants are the Executive KMP and select senior
executives who drive the growth strategy of ISA Group.
Awards are in the form of performance rights under the
ISA Group Performance Rights Plan.
If performance hurdles are met performance rights vest
and the employee will be allocated the relevant number
of shares. An employee granted performance rights is
not legally entitled to shares in ISA Group before the
rights vest. Once vested, each right entitles the
employee to receive one share in ISA Group.
Performance Rights issued to Executive KMP in 2015-
2016 are subject to a performance condition of
continuous service with the ISA Group from the Grant
Date until 1 July 2017. The performance period is two
years.
In 2012 as part of the employment of the CEO and COO
(Founding Directors), the Company committed to issue
certain rights to the Founding Directors on completion
certain milestones. A number of these milestones have
now passed, which are detailed in the Remuneration
Reports for prior years. During 2015-2016 the milestone
relating to the flight of the first paying customer in ISA
Group’s second vertical wind tunnel was achieved and
391,885 performance rights vested for each Founding
Director. The final tranche of incentives for the Founding
Directors is based on the performance of our first indoor
skydiving in the 2015-2016 financial year. Accordingly, all
incentives under the Founding Directors employment
contracts have either satisfied the hurdles or lapsed.
Subject to meeting the performance hurdles the
performance rights vest. Once vested the performance
rights can be exercised on the basis of one fully paid
ordinary ISA Group share for each performance right.
The performance conditions are set by the Board based
on the recommendation of the Remuneration &
Nomination Committee. Performance conditions are set
to drive outcomes which facilitate achieving our strategic
goals.
If a change in control event occurs unvested performance
rights will vest where, in the Board’s absolute discretion,
pro rata performance is in line with the performance
criteria applicable to those performance rights over the
period from date of grant to the date of the change in
control event.
If in the reasonable opinion of the Board a participant in
the LTI has acted fraudulently or dishonestly or is in
material breach of his or her obligations to ISA Group
then the Board in its absolute discretion may determine
that any unvested rights lapse, that any shares issued
pursuant to performance rights in these circumstances
20
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2016 Annual Report
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2016 Annual Report |
Remuneration Report
Who participates?
Participants are the Executive KMP and select senior
executives who drive the growth strategy of ISA Group.
What is the vehicle?
Awards are in the form of performance rights under the
ISA Group Performance Rights Plan.
Remuneration Report
are forfeited, or where the shares issued to the
performance rights have been sold require the
participant to pay to ISA Group all or part of the net
proceeds of sale.
Long Term Incentive Awards
Details of the equity instruments, comprising performance rights, provided as remuneration to each KMP in
the 2015-2016 financial year is set out below. When vested, each performance rights will entitle the holder to
one ordinary ISA Group share. Performance Rights will vest only if applicable performance hurdles are satisfied
in the relevant performance period.
What are the performance conditions and
Performance Rights issued to Executive KMP in 2015-
what is the performance period?
2016 are subject to a performance condition of
Name
Number of Performance
Rights Awarded during 2015-
2016
Number of Rights Vested
during 2015-2016
Executive Founding Directors
Wayne Jones
Danny Hogan
Other Key Management Personnel
Brett Sheridan
Stephen Burns
Fiona Yiend
620,409
620,409
129,054
129,054
129,054
391,855
391,855
135,000
85,000
85,000
How is it paid?
How are performance conditions set?
The performance conditions are set by the Board based
LTI Outcomes
During 2015-2016 ISA Group’s second indoor skydiving facility, iFLY Gold Coast, opened resulting in the
satisfaction of one of the milestone hurdles for the Executive Founding Directors. As a result, performance
rights were issued and vested for the Executive Founding Directors.
Retention based awards also vested during the year. As a result, performance rights issued to Brett Sheridan,
Stephen Burns and Fiona Yiend in prior years vested during the year. Details of these are set out above.
If performance hurdles are met performance rights vest
and the employee will be allocated the relevant number
of shares. An employee granted performance rights is
not legally entitled to shares in ISA Group before the
rights vest. Once vested, each right entitles the
employee to receive one share in ISA Group.
continuous service with the ISA Group from the Grant
Date until 1 July 2017. The performance period is two
years.
In 2012 as part of the employment of the CEO and COO
(Founding Directors), the Company committed to issue
certain rights to the Founding Directors on completion
certain milestones. A number of these milestones have
now passed, which are detailed in the Remuneration
Reports for prior years. During 2015-2016 the milestone
relating to the flight of the first paying customer in ISA
Group’s second vertical wind tunnel was achieved and
391,885 performance rights vested for each Founding
Director. The final tranche of incentives for the Founding
Directors is based on the performance of our first indoor
skydiving in the 2015-2016 financial year. Accordingly, all
incentives under the Founding Directors employment
contracts have either satisfied the hurdles or lapsed.
Subject to meeting the performance hurdles the
performance rights vest. Once vested the performance
rights can be exercised on the basis of one fully paid
ordinary ISA Group share for each performance right.
on the recommendation of the Remuneration &
Nomination Committee. Performance conditions are set
to drive outcomes which facilitate achieving our strategic
goals.
rights will vest where, in the Board’s absolute discretion,
pro rata performance is in line with the performance
criteria applicable to those performance rights over the
period from date of grant to the date of the change in
control event.
the LTI has acted fraudulently or dishonestly or is in
material breach of his or her obligations to ISA Group
then the Board in its absolute discretion may determine
that any unvested rights lapse, that any shares issued
pursuant to performance rights in these circumstances
What happens if a change of control occurs?
If a change in control event occurs unvested performance
What are the clawback provisions?
If in the reasonable opinion of the Board a participant in
Indoor Skydive Australia Group Limited
2016 Annual Report
20
Indoor Skydive Australia Group Limited
2016 Annual Report
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| 2016 Annual Report
Remuneration Report
REMUNERATION REPORT (Audited) Continued
Remuneration Report
Summary of Executive Contracts
Executive contracts set out remuneration details and other terms of employment for each individual executive.
The key provisions of the KMP contracts relating to terms of employment and notice periods are set out below.
Contractual terms vary due to the timing of contracts, individual negotiations and different market conditions.
Date of
contract
Term of
contract
Termination Payments
Notice required
to be given to the
Company for
termination by
Employee
Wayne Jones
Director and CEO
October 2012 Ongoing
6 months
Danny Hogan
Director and COO
October 2012 Ongoing
6 months
Stephen Burns
CFO
Brett Sheridan
CCO
July 2014
Ongoing
6 Weeks
May 2013
Ongoing
6 Weeks
Fiona Yiend
General Counsel &
Company Secretary
September
2013
Ongoing
6 Weeks
6 months’ notice for
termination by Employer
and legislative entitlements
on redundancy.
6 months’ notice for
termination by Employer
and legislative entitlements
on redundancy.
6 weeks’ notice for
termination by Employer
and legislative entitlements
on redundancy.
6 weeks’ notice for
termination by Employer
and 6 months on
redundancy.
6 weeks’ notice for
termination by Employer
and 6 months on
redundancy.
5. Non-Executive Director Remuneration
Approved Fee Pool
Non-Executive Director fees are determined within a maximum directors’ fee pool limit. The directors’ fee
pool was set in 2012 as $500,000. No director’s fees are paid to Executive Directors, Wayne Jones and Danny
Hogan. Total non-executive remuneration paid during 2015-2016 was $179,530.
Approach to setting Non-Executive Director Remuneration
Non-Executive Directors receive fixed remuneration in the form of a base fee plus fees for membership or
chairing Board Committees. The Chairman’s base fee has been calculated such that no additional fees are paid
for committee membership.
Non-Executive Directors do not receive variable remuneration or other performance-related incentives.
For the 2016-2017 financial year, the Non-Executive Director fees will not be increased. The Non-Executive
Directors fees for the last two financial years are set out below.
Financial
Salary and
Bonus
Share based
Total
payments
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
84,530
75,000
55,000
45,000
40,000
12,500
-
-
-
-
Year
2016
2015
2016
2015
2016
2015
2016
2015
2015
Ken Gillespie
Stephen Baxter
David Murray
Kirsten Thomson*
Malcolm Thompson**
2016
6. Other Statutory Disclosures
ISA Group’s Financial Performance
Fees
84,530
75,000
55,000
45,000
40,000
30,000
-
-
-
-
-
*
* Appointed 21 June 2016
** As an alternative director Malcolm Thompson does not receive any fees or remuneration from ISA Group.
The table below sets out ISA Group’s earnings and movements in shareholder wealth since establishment.
2012
2013
2014
2015
2016
Revenue
-
1,212,643
6,431,444
8,155,888
Net Profit/Loss after Tax
(206,116)
(914,571)
(2,714,016)
(1,903,921)
(1,314,903)
Share price at 30 June
0.43
0.68
0.45
0.40
* ISA Group listed on the ASX on 18 January 2013.
Performance rights holdings of KMP
Non-executive Directors do not hold performance rights. Details of the performance rights holdings of other
KMP are set out below:
22
Indoor Skydive Australia Group Limited
2016 Annual Report
22
Indoor Skydive Australia Group Limited
2016 Annual Report
23
2016 Annual Report |
Remuneration Report
Summary of Executive Contracts
Executive contracts set out remuneration details and other terms of employment for each individual executive.
The key provisions of the KMP contracts relating to terms of employment and notice periods are set out below.
Contractual terms vary due to the timing of contracts, individual negotiations and different market conditions.
Date of
contract
Term of
contract
Notice required
Termination Payments
to be given to the
Company for
termination by
Employee
Remuneration Report
Financial
Year
Salary and
Fees
Bonus
Share based
payments
Total
Ken Gillespie
Stephen Baxter
October 2012 Ongoing
6 months
6 months’ notice for
David Murray
October 2012 Ongoing
6 months
6 months’ notice for
Kirsten Thomson*
2016
2015
2016
2015
2016
2015
2016
2015
Stephen Burns
July 2014
Ongoing
6 Weeks
6 weeks’ notice for
Malcolm Thompson**
2016
2015
84,530
75,000
55,000
45,000
40,000
30,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
84,530
75,000
55,000
45,000
40,000
12,500
-
-
-
-
Brett Sheridan
May 2013
Ongoing
6 Weeks
6. Other Statutory Disclosures
* Appointed 21 June 2016
** As an alternative director Malcolm Thompson does not receive any fees or remuneration from ISA Group.
ISA Group’s Financial Performance
The table below sets out ISA Group’s earnings and movements in shareholder wealth since establishment.
2012
2013
2014
2015
2016
Revenue
-
-
1,212,643
6,431,444
8,155,888
Net Profit/Loss after Tax
(206,116)
(914,571)
(2,714,016)
(1,903,921)
(1,314,903)
Share price at 30 June
*
0.43
0.68
0.45
0.40
* ISA Group listed on the ASX on 18 January 2013.
Performance rights holdings of KMP
Non-executive Directors do not hold performance rights. Details of the performance rights holdings of other
KMP are set out below:
Wayne Jones
Director and CEO
Danny Hogan
Director and COO
CFO
CCO
termination by Employer
and legislative entitlements
on redundancy.
termination by Employer
and legislative entitlements
on redundancy.
termination by Employer
and legislative entitlements
on redundancy.
6 weeks’ notice for
termination by Employer
and 6 months on
redundancy.
6 weeks’ notice for
termination by Employer
and 6 months on
redundancy.
Fiona Yiend
September
Ongoing
6 Weeks
General Counsel &
Company Secretary
2013
5. Non-Executive Director Remuneration
Approved Fee Pool
Non-Executive Director fees are determined within a maximum directors’ fee pool limit. The directors’ fee
pool was set in 2012 as $500,000. No director’s fees are paid to Executive Directors, Wayne Jones and Danny
Hogan. Total non-executive remuneration paid during 2015-2016 was $179,530.
Approach to setting Non-Executive Director Remuneration
Non-Executive Directors receive fixed remuneration in the form of a base fee plus fees for membership or
chairing Board Committees. The Chairman’s base fee has been calculated such that no additional fees are paid
for committee membership.
Non-Executive Directors do not receive variable remuneration or other performance-related incentives.
For the 2016-2017 financial year, the Non-Executive Director fees will not be increased. The Non-Executive
Directors fees for the last two financial years are set out below.
Indoor Skydive Australia Group Limited
2016 Annual Report
22
Indoor Skydive Australia Group Limited
2016 Annual Report
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| 2016 Annual Report
Remuneration Report
REMUNERATION REPORT (Audited) Continued
Balance at 1
July 2015
Granted as
remuneration
Rights
exercised
Balance at 30 June
2016
0
0
548,409
319,855
548,409
319,855
135,000
129,054
135,000
0
214,054
85,000
129,054
85,000
85,000
228,554
228,554
129,054
129,054
129,054
Wayne Jones
Danny Hogan
Brett Sheridan
Stephen Burns
Fiona Yiend
Shareholdings of KMP
The shareholding of the Directors including Executive Directors is set out on page 10 of the Directors’ Report.
The holdings of the remaining KMP including their associates is as follows:
Employee
Role
Balance at 30 June 2016
Stephen Burns
Chief Financial Officer
Brett Sheridan
Chief Commercial Officer
Fiona Yiend
General Counsel & Company Secretary
295,000
550,000
177,555
2014 Annual General Meeting (AGM)
At the Company’s AGM in October 2015, 99.17% of votes received were in favour of adopting the
remuneration report.
Related party Transaction
No related party transactions were entered into with KMP during 2015-2016
24
Indoor Skydive Australia Group Limited
2016 Annual Report
24
2016 Annual Report |
Remuneration Report
Wayne Jones
Danny Hogan
Brett Sheridan
Stephen Burns
Fiona Yiend
Shareholdings of KMP
Balance at 1
July 2015
Granted as
remuneration
Rights
exercised
Balance at 30 June
2016
0
0
0
548,409
319,855
548,409
319,855
135,000
129,054
135,000
214,054
85,000
129,054
85,000
85,000
228,554
228,554
129,054
129,054
129,054
Stephen Burns
Chief Financial Officer
Brett Sheridan
Chief Commercial Officer
Fiona Yiend
General Counsel & Company Secretary
295,000
550,000
177,555
2014 Annual General Meeting (AGM)
At the Company’s AGM in October 2015, 99.17% of votes received were in favour of adopting the
remuneration report.
Related party Transaction
No related party transactions were entered into with KMP during 2015-2016
AUDITOR’S INDEPENDENCE DECLARATION
The shareholding of the Directors including Executive Directors is set out on page 10 of the Directors’ Report.
The holdings of the remaining KMP including their associates is as follows:
As lead auditor for the audit of the financial report of Indoor Skydive Australia Group Limited for the year ended
30 June 2016, I declare that, to the best of my knowledge and belief, there have been no contraventions of:
Employee
Role
Balance at 30 June 2016
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
AUDITOR’S INDEPENDENCE DECLARATION
(ii)
any applicable code of professional conduct in relation to the audit.
RSM AUSTRALIA PARTNERS
G N Sherwood
Partner
Sydney, NSW
Dated: 23 August 2016
Indoor Skydive Australia Group Limited
2016 Annual Report
24
25
| 2016 Annual Report
FINANCIAL
REPORT
Consolidated Statement of Profit or Loss and other Comprehensive Income
For the year ended 30 June 2016
Foreign exchange fair value gain
Revenue
Sales revenue
Grant income
Interest income
Total revenue
Expenses
Cost of sales
Depreciation and amortisation
Administration expenses
Accounting and audit fees
Legal fees
Professional Fees
Share registry and ASX fees
Advertising and marketing expense
Travel and entertainment expense
Share based payments
Employee expenses
Insurance
Directors fees
Finance costs
Occupancy expenses
Total expenses
Note
Consolidated Group
2016
2015
Restated
$
$
3
8,155,888
6,431,444
51,750
26,255
136,639
8,370,532
1,703,943
1,038,487
393,103
77,449
9,699
91,714
62,014
674,293
210,702
481,888
3,838,894
210,592
180,248
124,614
757,953
-
137,763
19,358
6,588,565
1,316,002
888,115
374,739
76,690
3,920
66,088
87,425
447,501
151,259
1,423,122
3,000,696
116,032
158,750
244,629
419,831
9,855,593
8,774,799
18
1 s
Loss for the period before tax
(1,485,061)
(2,186,234)
Income tax benefit
Loss for the period
4
170,158
282,313
(1,314,903)
(1,903,921)
Other comprehensive income for the period, net of tax
-
-
Total comprehensive loss for the period
(1,314,903)
(1,903,921)
Earnings per share
From continuing operations:
– Basic earnings per share (cents)
– Diluted earnings per share (cents)
22
22
(1.10)
(1.10)
(1.78)
(1.78)
The accompanying notes from part of these financial statements
Indoor Skydive Australia Group Limited
27
2016 Annual Report
CONSOLIDATED STATEMENT of Profit or Loss and other Comprehensive
Consolidated Statement of Profit or Loss and other Comprehensive Income
For the year ended 30 June 2016
Income For the year ended 30 June 2016
Revenue
Sales revenue
Grant income
Interest income
Foreign exchange fair value gain
Total revenue
Expenses
Cost of sales
Depreciation and amortisation
Administration expenses
Accounting and audit fees
Legal fees
Professional Fees
Share registry and ASX fees
Advertising and marketing expense
Travel and entertainment expense
Share based payments
Employee expenses
Insurance
Directors fees
Finance costs
Occupancy expenses
Total expenses
Note
Consolidated Group
2016
2015
Restated
$
$
3
18
1 s
8,155,888
51,750
26,255
136,639
8,370,532
1,703,943
1,038,487
393,103
77,449
9,699
91,714
62,014
674,293
210,702
481,888
3,838,894
210,592
180,248
124,614
757,953
9,855,593
6,431,444
-
137,763
19,358
6,588,565
1,316,002
888,115
374,739
76,690
3,920
66,088
87,425
447,501
151,259
1,423,122
3,000,696
116,032
158,750
244,629
419,831
8,774,799
Loss for the period before tax
(1,485,061)
(2,186,234)
Income tax benefit
Loss for the period
4
170,158
282,313
(1,314,903)
(1,903,921)
Other comprehensive income for the period, net of tax
-
-
Total comprehensive loss for the period
(1,314,903)
(1,903,921)
Earnings per share
From continuing operations:
– Basic earnings per share (cents)
– Diluted earnings per share (cents)
22
22
(1.10)
(1.10)
(1.78)
(1.78)
The accompanying notes from part of these financial statements
Indoor Skydive Australia Group Limited
2016 Annual Report
27
27
| 2016 Annual Report
CONSOLIDATED STATEMENT of Financial Position
As at 30 June 2016
Consolidated Statement of Financial Position
As at 30 June 2016
Consolidated Statement of Changes in Equity
For the year ended 30 June 2016
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Term deposits
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Deferred tax asset
Property, plant and equipment
Intangible asset
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Provisions
Deferred revenue
Borrowings
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Borrowings
Provision for site restoration
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Share based payments reserve
Accumulated losses
TOTAL EQUITY
Consolidated Group
2016
Notes
$
2015
Restated
$
5
6, 1 s
4, 1s
7
9
10
11
12
13
13
1 r v
14
18
2,550,601
-
748,319
3,298,920
4,321,619
1,325,556
606,261
6,253,436
1,844,162
38,070,213
426,378
40,340,753
1,674,004
23,881,098
710,630
26,265,732
43,639,673
32,519,166
3,445,188
195,260
1,016,439
711,584
5,368,471
2,042,848
109,683
1,280,530
-
3,433,061
8,436,342
1,581,770
10,018,112
-
-
-
15,386,583
3,433,061
28,253,090
29,086,107
34,648,455
658,164
(7,053,529)
28,253,090
33,639,681
1,185,050
(5,738,626)
29,086,107
The accompanying notes from part of these financial statements
Issued
Share based
Capital
$
payments
reserve
$
Accumulated
losses
$
Total
$
Balance at 1 July 2015
33,639,681
1,185,050
(5,738,626)
29,086,105
Shares issued during the period
1,008,774
(1,008,774)
-
481,888
481,888
Employee share based payment
performance rights
Comprehensive income
Loss for the period
Total comprehensive loss for the
period
-
(1,314,903)
(1,314,903)
-
(1,314,903)
(1,314,903)
Balance at 30 June 2016
34,648,455
658,164
(7,053,529)
28,253,090
Balance at 1 July 2014
18,467,998
1,093,569
(3,834,705)
15,726,862
Shares issued during the period
Share issue costs
Employee share based payment
performance rights
15,785,388
(613,705)
15,785,388
(613,705)
91,481
91,481
-
-
-
-
(1,749,988)
(1,749,988)
(153,933)
(153,933)
-
(1,903,921)
(1,903,921)
Comprehensive income
Loss for the period
Prior period adjustment
Total comprehensive loss for the
period
Balance at 30 June 2015
33,639,681
1,185,050
(5,738,626)
29,086,107
-
-
-
-
-
-
-
-
-
-
-
The accompanying notes from part of these financial statements
28
Indoor Skydive Australia Group Limited
2016 Annual Report
28
Indoor Skydive Australia Group Limited
29
2016 Annual Report
2016 Annual Report |
CONSOLIDATED STATEMENT of Changes in Equity
Consolidated Statement of Changes in Equity
For the year ended 30 June 2016
For the year ended 30 June 2016
Consolidated Statement of Financial Position
As at 30 June 2016
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Term deposits
Trade and other receivables
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Deferred tax asset
Property, plant and equipment
Intangible asset
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Provisions
Deferred revenue
Borrowings
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Borrowings
Provision for site restoration
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Share based payments reserve
Accumulated losses
TOTAL EQUITY
Consolidated Group
2016
2015
Restated
$
Notes
$
5
6, 1 s
4, 1s
7
9
10
11
12
13
13
1 r v
14
18
2,550,601
-
748,319
3,298,920
4,321,619
1,325,556
606,261
6,253,436
1,844,162
38,070,213
426,378
40,340,753
1,674,004
23,881,098
710,630
26,265,732
43,639,673
32,519,166
3,445,188
195,260
1,016,439
711,584
5,368,471
8,436,342
1,581,770
10,018,112
2,042,848
109,683
1,280,530
3,433,061
-
-
-
-
15,386,583
3,433,061
28,253,090
29,086,107
34,648,455
658,164
(7,053,529)
28,253,090
33,639,681
1,185,050
(5,738,626)
29,086,107
The accompanying notes from part of these financial statements
Issued
Capital
$
33,639,681
Share based
payments
reserve
$
1,185,050
Accumulated
losses
$
(5,738,626)
Total
$
29,086,105
1,008,774
(1,008,774)
481,888
-
-
-
481,888
-
-
-
-
(1,314,903)
(1,314,903)
(1,314,903)
(1,314,903)
Balance at 1 July 2015
Shares issued during the period
Employee share based payment
performance rights
Comprehensive income
Loss for the period
Total comprehensive loss for the
period
Balance at 30 June 2016
34,648,455
658,164
(7,053,529)
28,253,090
Balance at 1 July 2014
18,467,998
1,093,569
(3,834,705)
15,726,862
Shares issued during the period
Share issue costs
Employee share based payment
performance rights
Comprehensive income
Loss for the period
Prior period adjustment
Total comprehensive loss for the
period
15,785,388
(613,705)
-
-
-
-
-
-
91,481
-
-
-
-
-
-
15,785,388
(613,705)
91,481
(1,749,988)
(153,933)
(1,749,988)
(153,933)
(1,903,921)
(1,903,921)
Balance at 30 June 2015
33,639,681
1,185,050
(5,738,626)
29,086,107
The accompanying notes from part of these financial statements
Indoor Skydive Australia Group Limited
2016 Annual Report
28
Indoor Skydive Australia Group Limited
2016 Annual Report
29
29
| 2016 Annual Report CONSOLIDATED STATEMENT of Cash Flows
For the year ended 30 June 2016
Consolidated Statement of Cash Flows
For the year ended 30 June 2016
Cash Flows From Operating Activities
Receipts from customers
Payments to suppliers and employees
Grant income received
Interest received
Finance costs
Note
Consolidated Group
2015
2016
Restated
$
$
8,133,131
(7,861,681)
51,750
26,255
(76,335)
7,037,772
(6,427,011)
-
123,513
(270,943)
Net cash inflows from operating activities
16
273,120
463,331
Cash Flows From Investing Activities
Purchase of property, plant and equipment
Purchases of foreign exchange contracts
Sale/(purchase) of term deposits
(12,654,259)
-
1,325,556
(8,547,744)
(88,499)
(1,025,278)
Net cash outflows from investing activities
(11,328,703)
(9,661,521)
Cash Flows From Financing Activities
Proceeds from issue of securities
Proceeds from borrowings
Proceeds from convertible note
Share issue costs
13
-
9,147,926
-
-
14,453,746
-
(1,500,000)
(613,705)
Net cash inflows from financing activities
9,147,926
12,340,041
Net (decrease)/increase in cash held
(1,907,657)
3,141,851
Cash and cash equivalents at beginning of period
Effects of exchange rate changes
4,321,619
136,639
1,117,249
62,519
Cash and cash equivalents at end of period
5
2,550,601
4,321,619
activities.
The accompanying notes from part of these financial statements
30
Indoor Skydive Australia Group Limited
31
2016 Annual Report
Indoor Skydive Australia Group Limited
2016 Annual Report
30
Notes to the Financial Statements
For the year ended 30 June 2016
These consolidated financial statements and notes represent those of Indoor Skydive Australia Group
Limited and Controlled Entities (the Consolidated Group or Group).
The separate financial statements of the parent entity, Indoor Skydive Australia Group Limited have not
been presented within this financial report as permitted by the Corporations Act 2001.
The financial statements were authorised for issue on 23 August 2016 by the Directors of the Company.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation
The financial statements are general purpose financial statements that have been prepared in accordance
with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. The Group
is a for-profit entity for financial reporting purposes under Australian Accounting Standards.
Australian Accounting Standards set out accounting policies that the Australian Accounting Standards
Board has concluded would result in financial statements containing relevant and reliable information
about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that
the financial statements and notes also comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board. 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 accruals basis and
are based on historical costs, modified, where applicable, by the measurement at fair value of selected
non-current assets, financial assets and financial liabilities.
a.
Principles of Consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities
controlled by Indoor Skydive Australia Group Limited at the end of the reporting period. A
controlled entity is any entity over which Indoor Skydive Australia Group Limited has the ability
and right to govern the financial and operating policies so as to obtain benefits from the entity’s
Where controlled entities have entered or left the Group during the year, the financial
performance of those entities is included only for the period of the year that they were controlled.
A list of controlled entities is contained in Note 8 to the financial statements.
In preparing the consolidated financial statements, all intragroup balances and transactions
between entities in the consolidated group have been eliminated in full on consolidation. Non-
controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a
parent, are reported separately within the equity section of the consolidated statement of financial
position and statements showing profit or loss and other comprehensive income. The non-
controlling interests in the net assets comprise their interests at the date of the original business
combination and their share of changes in equity since that date.
2016 Annual Report | NOTES TO THE FINANCIAL STATEMENTS For the year
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
Consolidated Statement of Cash Flows
For the year ended 30 June 2016
Cash Flows From Operating Activities
Receipts from customers
Payments to suppliers and employees
Grant income received
Interest received
Finance costs
Cash Flows From Investing Activities
Purchase of property, plant and equipment
Purchases of foreign exchange contracts
Sale/(purchase) of term deposits
Cash Flows From Financing Activities
Proceeds from issue of securities
Proceeds from borrowings
Proceeds from convertible note
Share issue costs
2016
$
8,133,131
(7,861,681)
51,750
26,255
(76,335)
2015
Restated
$
7,037,772
(6,427,011)
-
123,513
(270,943)
(12,654,259)
(8,547,744)
1,325,556
(1,025,278)
(88,499)
-
-
-
-
13
9,147,926
14,453,746
-
(1,500,000)
(613,705)
Net cash inflows from operating activities
16
273,120
463,331
Net cash outflows from investing activities
(11,328,703)
(9,661,521)
Net cash inflows from financing activities
9,147,926
12,340,041
Net (decrease)/increase in cash held
(1,907,657)
3,141,851
Cash and cash equivalents at beginning of period
Effects of exchange rate changes
4,321,619
136,639
1,117,249
62,519
Cash and cash equivalents at end of period
5
2,550,601
4,321,619
The accompanying notes from part of these financial statements
Note
Consolidated Group
These consolidated financial statements and notes represent those of Indoor Skydive Australia Group
Limited and Controlled Entities (the Consolidated Group or Group).
The separate financial statements of the parent entity, Indoor Skydive Australia Group Limited have not
been presented within this financial report as permitted by the Corporations Act 2001.
The financial statements were authorised for issue on 23 August 2016 by the Directors of the Company.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Preparation
The financial statements are general purpose financial statements that have been prepared in accordance
with Australian Accounting Standards, Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. The Group
is a for-profit entity for financial reporting purposes under Australian Accounting Standards.
Australian Accounting Standards set out accounting policies that the Australian Accounting Standards
Board has concluded would result in financial statements containing relevant and reliable information
about transactions, events and conditions. Compliance with Australian Accounting Standards ensures that
the financial statements and notes also comply with International Financial Reporting Standards as issued
by the International Accounting Standards Board. 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 accruals basis and
are based on historical costs, modified, where applicable, by the measurement at fair value of selected
non-current assets, financial assets and financial liabilities.
a.
Principles of Consolidation
The consolidated financial statements incorporate the assets, liabilities and results of entities
controlled by Indoor Skydive Australia Group Limited at the end of the reporting period. A
controlled entity is any entity over which Indoor Skydive Australia Group Limited has the ability
and right to govern the financial and operating policies so as to obtain benefits from the entity’s
activities.
Where controlled entities have entered or left the Group during the year, the financial
performance of those entities is included only for the period of the year that they were controlled.
A list of controlled entities is contained in Note 8 to the financial statements.
In preparing the consolidated financial statements, all intragroup balances and transactions
between entities in the consolidated group have been eliminated in full on consolidation. Non-
controlling interests, being the equity in a subsidiary not attributable, directly or indirectly, to a
parent, are reported separately within the equity section of the consolidated statement of financial
position and statements showing profit or loss and other comprehensive income. The non-
controlling interests in the net assets comprise their interests at the date of the original business
combination and their share of changes in equity since that date.
Indoor Skydive Australia Group Limited
2016 Annual Report
30
Indoor Skydive Australia Group Limited
2016 Annual Report
31
31
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
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 attained, 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 in 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)
(ii)
(iii)
the consideration transferred;
any non-controlling interest (determined under either the full goodwill or
proportionate interest method); and
the acquisition date fair value of any previously held equity interest,
over the acquisition date fair value of net identifiable assets acquired.
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.
Fair value remeasurements in any pre-existing equity holdings are recognised in profit or loss in
the period in which they arise. Where changes in the value of such equity holdings had previously
been recognised in other comprehensive income, such amounts are recycled to profit or loss.
The amount of goodwill recognised on acquisition of each subsidiary in which the Group holds less
than a 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 notes to these financial statements disclosing the business combination.
Under the full goodwill method, the fair value of the non-controlling interests is determined using
valuation techniques which make the maximum use of market information where available. Under
this method, goodwill attributable to the non-controlling interests is recognised in the consolidated
financial statements.
32
Indoor Skydive Australia Group Limited
2016 Annual Report
32
Indoor Skydive Australia Group Limited
2016 Annual Report
33
Notes to the Financial Statements
For the year ended 30 June 2016
Goodwill on acquisition 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 being
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.
Changes in the ownership interests in a subsidiary that do not result in a loss of control are
accounted for as equity transactions and do not affect the carrying amounts of goodwill.
b.
Income Tax
The income tax expense/(benefit) for the year comprises current income tax expense/(benefit) and
deferred tax expense/(benefit).
Current income tax expense charged to profit or loss is the tax payable on taxable income. Current
tax liabilities/(assets) are measured at the amounts expected to be paid to/(recovered from) the
relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability
balances during the year as well as unused tax losses.
Current and deferred income tax expense/(benefit) is charged or credited outside profit or loss
when the tax relates to items that are recognised outside profit or 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.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to
the extent that it is probable that future taxable profit will be available against which the benefits
of the deferred tax asset can be utilised.
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: (a) a legally enforceable
right of set-off exists; and (b) 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.
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
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 attained, 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 in 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 is carried at cost less any accumulated impairment losses. Goodwill is calculated as the
Goodwill
(i)
(ii)
excess of the sum of:
the consideration transferred;
any non-controlling interest (determined under either the full goodwill or
proportionate interest method); and
(iii)
the acquisition date fair value of any previously held equity interest,
over the acquisition date fair value of net identifiable assets acquired.
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.
Fair value remeasurements in any pre-existing equity holdings are recognised in profit or loss in
the period in which they arise. Where changes in the value of such equity holdings had previously
been recognised in other comprehensive income, such amounts are recycled to profit or loss.
The amount of goodwill recognised on acquisition of each subsidiary in which the Group holds less
than a 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 notes to these financial statements disclosing the business combination.
Under the full goodwill method, the fair value of the non-controlling interests is determined using
valuation techniques which make the maximum use of market information where available. Under
this method, goodwill attributable to the non-controlling interests is recognised in the consolidated
financial statements.
Goodwill on acquisition 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 being
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.
Changes in the ownership interests in a subsidiary that do not result in a loss of control are
accounted for as equity transactions and do not affect the carrying amounts of goodwill.
b.
Income Tax
The income tax expense/(benefit) for the year comprises current income tax expense/(benefit) and
deferred tax expense/(benefit).
Current income tax expense charged to profit or loss is the tax payable on taxable income. Current
tax liabilities/(assets) are measured at the amounts expected to be paid to/(recovered from) the
relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability
balances during the year as well as unused tax losses.
Current and deferred income tax expense/(benefit) is charged or credited outside profit or loss
when the tax relates to items that are recognised outside profit or 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.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to
the extent that it is probable that future taxable profit will be available against which the benefits
of the deferred tax asset can be utilised.
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: (a) a legally enforceable
right of set-off exists; and (b) 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.
Indoor Skydive Australia Group Limited
2016 Annual Report
32
Indoor Skydive Australia Group Limited
2016 Annual Report
33
33
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
The depreciable amount of all fixed assets including buildings and capitalised lease assets, but
excluding freehold land, is depreciated on a straight-line basis over the asset’s useful life to the
consolidated 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
Useful Life
Office equipment
Furniture and fittings
IT equipment
3 years
5 years
5 years
Vertical wind tunnel building infrastructure
40 years
Vertical wind tunnel equipment
20 years
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. When
revalued assets are sold, amounts included in the revaluation surplus relating to that asset are
transferred to retained earnings.
d.
Leases
Leases of fixed assets, where substantially all the risks and benefits incidental to the ownership of
the asset – but not the legal ownership – are transferred to entities in the consolidated group, are
classified as finance leases.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Tax Consolidation - Australia
Depreciation
The Company and its wholly-owned Australian resident entities have formed a tax consolidated
group with effect from 1 November 2011 and will therefore be taxed as a single entity from that
date. The Company is the head entity within the tax-consolidated group.
Current tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary
differences of the members of the tax-consolidated group are recognised in the separate financial
statements of the members of the tax-consolidated group using a modified stand-alone tax
allocation methodology.
Any current tax liabilities (or assets) and deferred tax assets arising from unused tax losses of the
controlled entities are assumed by the head entity in the tax-consolidated group and are
recognised as amounts payable (receivable) to (from) other entities in the tax-consolidated group
in conjunction with any tax funding arrangements.
The Company recognises deferred tax assets arising from unused tax losses of the tax-consolidated
group to the extent that it is probable that future taxable profits of the tax-consolidated group will
be available against which the asset can be utilised.
Any subsequent period adjustments to deferred tax assets arising from unused tax losses as a result
of revised assessments of the probability of recoverability is recognised by the head company only.
c.
Property, Plant and Equipment
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of
each reporting period.
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.
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.
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 or as a revaluation decrease if the impairment losses relate to a revalued asset. 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.
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.
34
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34
Indoor Skydive Australia Group Limited
2016 Annual Report
35
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Tax Consolidation - Australia
Depreciation
The depreciable amount of all fixed assets including buildings and capitalised lease assets, but
excluding freehold land, is depreciated on a straight-line basis over the asset’s useful life to the
consolidated 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
Useful Life
Office equipment
Furniture and fittings
IT equipment
3 years
5 years
5 years
Vertical wind tunnel building infrastructure
40 years
Vertical wind tunnel equipment
20 years
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of
each reporting period.
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.
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. When
revalued assets are sold, amounts included in the revaluation surplus relating to that asset are
transferred to retained earnings.
d.
Leases
Leases of fixed assets, where substantially all the risks and benefits incidental to the ownership of
the asset – but not the legal ownership – are transferred to entities in the consolidated group, are
classified as finance leases.
The Company and its wholly-owned Australian resident entities have formed a tax consolidated
group with effect from 1 November 2011 and will therefore be taxed as a single entity from that
date. The Company is the head entity within the tax-consolidated group.
Current tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary
differences of the members of the tax-consolidated group are recognised in the separate financial
statements of the members of the tax-consolidated group using a modified stand-alone tax
allocation methodology.
Any current tax liabilities (or assets) and deferred tax assets arising from unused tax losses of the
controlled entities are assumed by the head entity in the tax-consolidated group and are
recognised as amounts payable (receivable) to (from) other entities in the tax-consolidated group
in conjunction with any tax funding arrangements.
The Company recognises deferred tax assets arising from unused tax losses of the tax-consolidated
group to the extent that it is probable that future taxable profits of the tax-consolidated group will
be available against which the asset can be utilised.
Any subsequent period adjustments to deferred tax assets arising from unused tax losses as a result
of revised assessments of the probability of recoverability is recognised by the head company only.
c.
Property, Plant and Equipment
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 or as a revaluation decrease if the impairment losses relate to a revalued asset. 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.
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.
Indoor Skydive Australia Group Limited
2016 Annual Report
34
Indoor Skydive Australia Group Limited
2016 Annual Report
35
35
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
h.
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.
i.
Impairment of Assets
At the end of each reporting period, the Group assesses whether there is any indication that an
asset may be impaired. The assessment will include the consideration of external and internal
sources of information. If such an indication exists, an impairment test is carried out on the asset
by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less
costs to sell and value in use, to the asset’s carrying 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 Group
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.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Finance leases are capitalised by recognising an asset and a liability at the lower of the amounts
equal to the fair value of the leased property or the present value of the minimum lease payments,
including any guaranteed residual values. Lease payments are allocated between the reduction of
the lease liability and the lease interest expense for the period.
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful
lives or the lease term.
Lease payments for operating leases, where substantially all the risks and benefits remain with the
lessor, are recognised as expenses in the periods in which they are incurred.
Lease incentives under operating leases are recognised as a liability and amortised on a straight-
line basis over the lease term.
e.
Foreign Currency Transactions and Balances
Functional and Presentation Currency
The functional currency of each of the Group’s entities is measured using the currency of the
primary economic environment in which that entity operates. The consolidated financial
statements are presented in Australian dollars, which is the parent entity’s functional currency.
Transactions and Balances
Exchange differences arising on the translation of monetary items are recognised in profit or loss,
except where deferred in equity as a qualifying cash flow or net investment hedge.
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 profit or loss.
f.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits available on demand with banks and
bank overdrafts. Bank overdrafts are reported within short-term borrowings in current liabilities in
the statement of financial position.
g.
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. Payables expected to be settled within 12
months of the end of the reporting period are classified as current liabilities. All other liabilities
are classified as non-current liabilities.
36
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Indoor Skydive Australia Group Limited
2016 Annual Report
37
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Finance leases are capitalised by recognising an asset and a liability at the lower of the amounts
equal to the fair value of the leased property or the present value of the minimum lease payments,
including any guaranteed residual values. Lease payments are allocated between the reduction of
the lease liability and the lease interest expense for the period.
Leased assets are depreciated on a straight-line basis over the shorter of their estimated useful
lives or the lease term.
Lease payments for operating leases, where substantially all the risks and benefits remain with the
lessor, are recognised as expenses in the periods in which they are incurred.
Lease incentives under operating leases are recognised as a liability and amortised on a straight-
line basis over the lease term.
e.
Foreign Currency Transactions and Balances
Functional and Presentation Currency
The functional currency of each of the Group’s entities is measured using the currency of the
primary economic environment in which that entity operates. The consolidated financial
statements are presented in Australian dollars, which is the parent entity’s functional currency.
Transactions and Balances
Exchange differences arising on the translation of monetary items are recognised in profit or loss,
except where deferred in equity as a qualifying cash flow or net investment hedge.
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 profit or loss.
Cash and cash equivalents include cash on hand, deposits available on demand with banks and
bank overdrafts. Bank overdrafts are reported within short-term borrowings in current liabilities in
f.
Cash and Cash Equivalents
the statement of financial position.
g.
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. Payables expected to be settled within 12
months of the end of the reporting period are classified as current liabilities. All other liabilities
are classified as non-current liabilities.
h.
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.
i.
Impairment of Assets
At the end of each reporting period, the Group assesses whether there is any indication that an
asset may be impaired. The assessment will include the consideration of external and internal
sources of information. If such an indication exists, an impairment test is carried out on the asset
by comparing the recoverable amount of the asset, being the higher of the asset’s fair value less
costs to sell and value in use, to the asset’s carrying 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 Group
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.
Indoor Skydive Australia Group Limited
2016 Annual Report
36
Indoor Skydive Australia Group Limited
2016 Annual Report
37
37
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
j.
Employee Benefits
l.
Revenue and Other Income
Provision is made for the Group’s liability for employee benefits arising from services rendered by
employees to the end of the reporting period. Employee benefits that are expected to be settled
within a year have been measured at the amounts expected to be paid when the liability is settled.
Expenses for non-accumulating sick leave are recognised when the leave is taken and are measured
at the rates paid or payable. Liabilities for long service leave are recognised when employees reach
a qualifying period of continuous service. Liabilities and expenses for bonuses are recognised
where contractually obliged or where there is a past practice that has created a constructive
obligation.
Share-based Payments
Share-based compensation benefits are provided to certain employees (including key
management personnel) via the Indoor Skydive Australia Group Limited Performance Rights Plan.
The fair value is measured at grant date and is recognised over the period the services are received,
which is the expected vesting period during which the employees would become entitled to
exercise the performance rights.
Non-market vesting conditions are included in assumptions about the number of options that are
expected to become exercisable. Estimates are subsequently revised if there is any indication that
the number of share options expected to vest differs from previous estimates. Any cumulative
adjustment prior to vesting is recognised in the current period. No adjustment is made to any
expense recognised in prior periods if share options ultimately exercised are different to that
estimated on vesting.
The fair value of performance rights granted for rights with non-market based performance criteria
are measured using the binomial option pricing methodology which is the approach typically used
for valuing rights which may be exercised, once vested, at any time up until expiry.
Upon exercise of share options, the proceeds received net of any directly attributable transaction
costs are allocated to contributed equity.
k.
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.
38
Indoor Skydive Australia Group Limited
2016 Annual Report
38
Indoor Skydive Australia Group Limited
2016 Annual Report
39
Notes to the Financial Statements
For the year ended 30 June 2016
Revenue is measured at the fair value of the consideration received or receivable after taking into
account any trade discounts and volume rebates allowed. When the inflow of consideration is
deferred, it is included in the Statement of Financial Position as a current liability.
Revenue from the sale of goods and services is recognised at the point of delivery as this
corresponds to the transfer of significant risks and rewards of ownership and the cessation of all
involvement in those goods and services.
Interest revenue is recognised on an accruals basis using the effective interest method.
m.
Deferred Revenue
n.
Trade and Other Receivables
Income relating to future periods is initially recorded as deferred revenue, and is then recognised
as revenue over the relevant periods of admission or rendering of other services.
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.
o.
Inventories
p.
Borrowing Costs
nventories are valued at the lower of cost and net realisable value. Cost is determined using the
weighted average cost method, after deducting any purchase settlement discount and including
logistics expenses incurred in bringing the inventories to their present location and condition.
I
Borrowing costs directly attributable to the acquisition, construction or production of assets that
necessarily take a substantial period of time to prepare for their intended use or sale are added to
the cost of those assets, until such time as the assets are substantially ready for their intended use
or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
q.
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 Group has retrospectively applied an accounting policy, made a retrospective
restatement or reclassified items in its financial statements, an additional statement of financial
position as at the beginning of the earliest comparative period will be disclosed.
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
j.
Employee Benefits
l.
Revenue and Other Income
Provision is made for the Group’s liability for employee benefits arising from services rendered by
employees to the end of the reporting period. Employee benefits that are expected to be settled
within a year have been measured at the amounts expected to be paid when the liability is settled.
Expenses for non-accumulating sick leave are recognised when the leave is taken and are measured
at the rates paid or payable. Liabilities for long service leave are recognised when employees reach
a qualifying period of continuous service. Liabilities and expenses for bonuses are recognised
where contractually obliged or where there is a past practice that has created a constructive
obligation.
Share-based Payments
Share-based compensation benefits are provided to certain employees (including key
management personnel) via the Indoor Skydive Australia Group Limited Performance Rights Plan.
The fair value is measured at grant date and is recognised over the period the services are received,
which is the expected vesting period during which the employees would become entitled to
exercise the performance rights.
Non-market vesting conditions are included in assumptions about the number of options that are
expected to become exercisable. Estimates are subsequently revised if there is any indication that
the number of share options expected to vest differs from previous estimates. Any cumulative
adjustment prior to vesting is recognised in the current period. No adjustment is made to any
expense recognised in prior periods if share options ultimately exercised are different to that
estimated on vesting.
The fair value of performance rights granted for rights with non-market based performance criteria
are measured using the binomial option pricing methodology which is the approach typically used
for valuing rights which may be exercised, once vested, at any time up until expiry.
Upon exercise of share options, the proceeds received net of any directly attributable transaction
costs are allocated to contributed equity.
k.
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.
Revenue is measured at the fair value of the consideration received or receivable after taking into
account any trade discounts and volume rebates allowed. When the inflow of consideration is
deferred, it is included in the Statement of Financial Position as a current liability.
Revenue from the sale of goods and services is recognised at the point of delivery as this
corresponds to the transfer of significant risks and rewards of ownership and the cessation of all
involvement in those goods and services.
Interest revenue is recognised on an accruals basis using the effective interest method.
m.
Deferred Revenue
Income relating to future periods is initially recorded as deferred revenue, and is then recognised
as revenue over the relevant periods of admission or rendering of other services.
n.
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.
o.
Inventories
nventories are valued at the lower of cost and net realisable value. Cost is determined using the
weighted average cost method, after deducting any purchase settlement discount and including
I
logistics expenses incurred in bringing the inventories to their present location and condition.
p.
Borrowing Costs
Borrowing costs directly attributable to the acquisition, construction or production of assets that
necessarily take a substantial period of time to prepare for their intended use or sale are added to
the cost of those assets, until such time as the assets are substantially ready for their intended use
or sale.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
q.
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 Group has retrospectively applied an accounting policy, made a retrospective
restatement or reclassified items in its financial statements, an additional statement of financial
position as at the beginning of the earliest comparative period will be disclosed.
Indoor Skydive Australia Group Limited
2016 Annual Report
38
Indoor Skydive Australia Group Limited
2016 Annual Report
39
39
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
Gift card revenue from the sale of gift cards is recognised when the card is redeemed for the
purchase of flight time (Flight Revenue), or when the gift card is no longer expected to be
redeemed (Gift Card Revenue). At 30 June 2016, $704,947 of Gift Card Revenue is recognised
(2015: $0). The key assumption in measuring the liability for gift cards and vouchers is the expected
redemption rates by customers, which are reviewed based on historical information. Any
reassessment of expected redemption rates in a particular period impacts the revenue recognised
from expiry of gift cards and vouchers (either increasing or decreasing). Any foreseeable change in
the estimate is unlikely to have a material impact on the financial statements.
v.
Site Restoration
Provisions for site restoration obligations are recognised when the Group has a present legal or
constructive obligation as a result of past events; it is probable that an outflow of resources will be
required to settle the obligation and the amount has been reliably estimated.
The Board obtained new information in the current year in relation to the Penrith facility and have
consequently elected to raise a provision for site restoration costs. Provisions for site restoration
have also been raised for Perth and the Gold Coast in the year under review. All three projects are
therefore now treated in the same manner. An estimate of the costs to remove the VWT’s and its
related Building Infrastructure has been determined based on current costs using existing
technology at current prices. Management has used the services of an expert in determining the
cost to restore the Perth site which have been quantified at approximately $0.7m once the project
is completed later this year. Using the same costing methodology, the site restoration costs for
Gold Coast and Penrith are expected to be $0.6m and $0.8m respectively. These costs were
projected forward at a 2.5% inflationary escalation and then discounted back at 2.5% after
consideration of the associated risks. The site restoration asset will be depreciated over the
remainder of each extended lease period being 40 years. The unwinding of the effect of
discounting on the site restoration provision will be included within finance costs in the statement
of comprehensive income over the same period.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
r.
Critical Accounting Estimates and Judgements
iv.
Gift Card Revenue
i.
Useful lives, Residual Values and Classification of Property, Plant and Equipment
There is a degree of judgement required in estimating the residual values and useful lives of the
Property, Plant and Equipment. There is also a degree of judgement required in terms of the
classification of such Property, Plant and Equipment. The Group’s main assets at present comprise
the Vertical Wind Tunnel (VWT) Equipment and its related Building Infrastructure. The
construction of these assets are typically foreseen in the lease agreements, however the Board has
exercised their judgement in determining that the nature of these assets are that of buildings and
equipment, rather than leasehold improvements. To this extend the Board has confirmed the
useful life of the Buildings to be 40 years and VWT equipment to be 20 years and the residual values
of both these classes of assets to be nil.
ii.
Deferred Tax
Once the additional facilities are operational, the Group is expecting to generate a taxable income.
As it is therefore considered probable that the unused tax losses will be recouped, the directors
have recognised a deferred tax asset to the extent of the tax losses and deductible temporary
differences.
iii.
Exclusive Territory Development Agreement Recognition and Amortisation
On 20 December 2013 an Exclusive Territory Development Agreement was entered into between
the Company and iFly Australia Pty Ltd (iFly) to exclusively develop projects in Australia and New
Zealand for which iFly would receive 2,500,000 shares in the company (IDZ.ASX). iFly is the
Australian subsidiary of SkyVenture International, our vertical wind tunnel supplier. The agreement
has created an intangible asset which is expected to create a future economic benefit. This
intangible asset must be initially valued at cost, in accordance with AASB 138. The cost is calculated
as $1,500,000, being the fair value of the shares granted to iFly, at the IDZ close price of $0.60 at
20 December 2013.
The term of the agreement is limited, and the asset is therefore classified as a finite life intangible
asset. An intangible asset with a finite life is to be amortised over its useful life. The amortisation
method selected should reflect the pattern over which the asset’s future economic benefit is
expected to be consumed. If that pattern cannot be determined reliably, the straight-line method
is to be used. The amortisation period and method for an intangible asset with a finite useful life
are to be reviewed at least at the end of each annual reporting period. If the expected useful life
or expected pattern of consumption of the future economic benefit is different from previous
estimates, the period or method is to be revised. As at the reporting date, there is no change to
the previous estimates.
An accelerated amortisation rate of 40% has been used against this intangible asset. This reflects
the expected consumption of benefits under the agreement. Although it is conceivable that the
agreement could run to the full term of 20 years, management expect that the majority of the
benefit will be achieved over an initial period of four years through the delivery of the four tunnels
for which deposits have been paid to SkyVenture International.
40
Indoor Skydive Australia Group Limited
2016 Annual Report
40
Indoor Skydive Australia Group Limited
2016 Annual Report
41
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
r.
Critical Accounting Estimates and Judgements
iv.
Gift Card Revenue
i.
Useful lives, Residual Values and Classification of Property, Plant and Equipment
There is a degree of judgement required in estimating the residual values and useful lives of the
Property, Plant and Equipment. There is also a degree of judgement required in terms of the
classification of such Property, Plant and Equipment. The Group’s main assets at present comprise
the Vertical Wind Tunnel (VWT) Equipment and its related Building Infrastructure. The
construction of these assets are typically foreseen in the lease agreements, however the Board has
exercised their judgement in determining that the nature of these assets are that of buildings and
equipment, rather than leasehold improvements. To this extend the Board has confirmed the
useful life of the Buildings to be 40 years and VWT equipment to be 20 years and the residual values
of both these classes of assets to be nil.
ii.
Deferred Tax
Once the additional facilities are operational, the Group is expecting to generate a taxable income.
As it is therefore considered probable that the unused tax losses will be recouped, the directors
have recognised a deferred tax asset to the extent of the tax losses and deductible temporary
differences.
iii.
Exclusive Territory Development Agreement Recognition and Amortisation
On 20 December 2013 an Exclusive Territory Development Agreement was entered into between
the Company and iFly Australia Pty Ltd (iFly) to exclusively develop projects in Australia and New
Zealand for which iFly would receive 2,500,000 shares in the company (IDZ.ASX). iFly is the
Australian subsidiary of SkyVenture International, our vertical wind tunnel supplier. The agreement
has created an intangible asset which is expected to create a future economic benefit. This
intangible asset must be initially valued at cost, in accordance with AASB 138. The cost is calculated
as $1,500,000, being the fair value of the shares granted to iFly, at the IDZ close price of $0.60 at
20 December 2013.
The term of the agreement is limited, and the asset is therefore classified as a finite life intangible
asset. An intangible asset with a finite life is to be amortised over its useful life. The amortisation
method selected should reflect the pattern over which the asset’s future economic benefit is
expected to be consumed. If that pattern cannot be determined reliably, the straight-line method
is to be used. The amortisation period and method for an intangible asset with a finite useful life
are to be reviewed at least at the end of each annual reporting period. If the expected useful life
or expected pattern of consumption of the future economic benefit is different from previous
estimates, the period or method is to be revised. As at the reporting date, there is no change to
the previous estimates.
An accelerated amortisation rate of 40% has been used against this intangible asset. This reflects
the expected consumption of benefits under the agreement. Although it is conceivable that the
agreement could run to the full term of 20 years, management expect that the majority of the
benefit will be achieved over an initial period of four years through the delivery of the four tunnels
for which deposits have been paid to SkyVenture International.
Gift card revenue from the sale of gift cards is recognised when the card is redeemed for the
purchase of flight time (Flight Revenue), or when the gift card is no longer expected to be
redeemed (Gift Card Revenue). At 30 June 2016, $704,947 of Gift Card Revenue is recognised
(2015: $0). The key assumption in measuring the liability for gift cards and vouchers is the expected
redemption rates by customers, which are reviewed based on historical information. Any
reassessment of expected redemption rates in a particular period impacts the revenue recognised
from expiry of gift cards and vouchers (either increasing or decreasing). Any foreseeable change in
the estimate is unlikely to have a material impact on the financial statements.
v.
Site Restoration
Provisions for site restoration obligations are recognised when the Group has a present legal or
constructive obligation as a result of past events; it is probable that an outflow of resources will be
required to settle the obligation and the amount has been reliably estimated.
The Board obtained new information in the current year in relation to the Penrith facility and have
consequently elected to raise a provision for site restoration costs. Provisions for site restoration
have also been raised for Perth and the Gold Coast in the year under review. All three projects are
therefore now treated in the same manner. An estimate of the costs to remove the VWT’s and its
related Building Infrastructure has been determined based on current costs using existing
technology at current prices. Management has used the services of an expert in determining the
cost to restore the Perth site which have been quantified at approximately $0.7m once the project
is completed later this year. Using the same costing methodology, the site restoration costs for
Gold Coast and Penrith are expected to be $0.6m and $0.8m respectively. These costs were
projected forward at a 2.5% inflationary escalation and then discounted back at 2.5% after
consideration of the associated risks. The site restoration asset will be depreciated over the
remainder of each extended lease period being 40 years. The unwinding of the effect of
discounting on the site restoration provision will be included within finance costs in the statement
of comprehensive income over the same period.
Indoor Skydive Australia Group Limited
2016 Annual Report
40
Indoor Skydive Australia Group Limited
2016 Annual Report
41
41
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
At the date of this financial report the following standards and interpretations, which may impact the
entity in the period of initial application, have been issued but are not yet effective:
Reference
Title
Summary
Expected Impact
Application
date (financial
years
beginning)
AASB 1057
Application of
The AASB moved application paragraphs in
1 January 2016 No expected
all Australian Accounting Standards to this
impact
AASB
2014-1D
Amendments to
Part D of AASB 2014-1 makes amendments
1 January 2016
Impact first-time
adopters only
AASB 2014-3
Amendments to
This Standard amends AASB 11 to provide
1 January 2016 No impact
new standard, in order to maintain
consistency with the layout of IFRS
standards.
to AASB 1 First-time Adoption of Australian
Accounting Standards, which arise from the
issuance of AASB 14 Regulatory Deferral
Accounts in June 2014.
guidance on the accounting for acquisitions
of interests in joint operations in which the
activity constitutes a business.
AASB 2014-4
Amendments to
This Standard amends AASB 116 and AASB
1 January 2016 Minimal impact
138 to establish the principle for the basis of
depreciation and amortisation as being the
expected pattern of consumption of the
Clarification of
future economic benefits of an asset, and to
clarify that revenue is generally presumed
to be an inappropriate basis for that
Depreciation and
purpose.
Amortisation
Australian
Accounting
Standards
Australian
Accounting
Standards
Australian
Accounting
Standards –
Accounting for
Acquisitions of
Interests in Joint
Operations
Australian
Accounting
Standards –
Acceptable
Methods of
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
s.
Prior Period Adjustment
t.
New Accounting Standards for Application in Future Periods
a. For the year ended 30 June 2015, the company, based on prior accounting policy advice,
capitalised property lease expenditure in relation to the Gold Coast vertical wind tunnel
development. This policy was not relevant to the Penrith vertical wind tunnel development
where lease rental was not payable until the commencement of operations. While not
considered to be material and based on further accounting policy advice, the directors
decided to reverse this treatment by restating opening retained earnings and comparative
figures. The after tax effect of the capitalisation of lease rentals is determined to be
$153,933. The adjustment relates only to the 2015 financial year affecting the following
financial statement line items:
Previously
Reported
Restated
Difference
Statement of Financial Position
Trade Receivables and Other Assets
$826,165
$606,261
($219,904)
Deferred Tax
$1,608,033 $1,674,004
($65,971)
Statement of Profit or Loss
Occupancy Expenses
Income Tax Benefits
$199,917
$419,821
($219,904)
$216,342
$282,313
($65,971)
Basic Earnings Per Share
(1.63)
(1.78)
Diluted Earnings Per Share
(1.63)
(1.78)
(0.15)
(0.15)
42
Indoor Skydive Australia Group Limited
2016 Annual Report
42
Indoor Skydive Australia Group Limited
2016 Annual Report
43
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
s.
Prior Period Adjustment
t.
New Accounting Standards for Application in Future Periods
a. For the year ended 30 June 2015, the company, based on prior accounting policy advice,
capitalised property lease expenditure in relation to the Gold Coast vertical wind tunnel
development. This policy was not relevant to the Penrith vertical wind tunnel development
where lease rental was not payable until the commencement of operations. While not
considered to be material and based on further accounting policy advice, the directors
decided to reverse this treatment by restating opening retained earnings and comparative
figures. The after tax effect of the capitalisation of lease rentals is determined to be
$153,933. The adjustment relates only to the 2015 financial year affecting the following
financial statement line items:
Previously
Restated
Difference
Reported
Statement of Financial Position
Trade Receivables and Other Assets
$826,165
$606,261
($219,904)
Deferred Tax
$1,608,033 $1,674,004
($65,971)
Statement of Profit or Loss
Occupancy Expenses
Income Tax Benefits
$199,917
$419,821
($219,904)
$216,342
$282,313
($65,971)
Basic Earnings Per Share
(1.63)
(1.78)
Diluted Earnings Per Share
(1.63)
(1.78)
(0.15)
(0.15)
At the date of this financial report the following standards and interpretations, which may impact the
entity in the period of initial application, have been issued but are not yet effective:
Reference
Title
Summary
AASB 1057
AASB
2014-1D
AASB 2014-3
AASB 2014-4
Application of
Australian
Accounting
Standards
Amendments to
Australian
Accounting
Standards
Amendments to
Australian
Accounting
Standards –
Accounting for
Acquisitions of
Interests in Joint
Operations
Amendments to
Australian
Accounting
Standards –
Clarification of
Acceptable
Methods of
Depreciation and
Amortisation
The AASB moved application paragraphs in
all Australian Accounting Standards to this
new standard, in order to maintain
consistency with the layout of IFRS
standards.
Part D of AASB 2014-1 makes amendments
to AASB 1 First-time Adoption of Australian
Accounting Standards, which arise from the
issuance of AASB 14 Regulatory Deferral
Accounts in June 2014.
This Standard amends AASB 11 to provide
guidance on the accounting for acquisitions
of interests in joint operations in which the
activity constitutes a business.
This Standard amends AASB 116 and AASB
138 to establish the principle for the basis of
depreciation and amortisation as being the
expected pattern of consumption of the
future economic benefits of an asset, and to
clarify that revenue is generally presumed
to be an inappropriate basis for that
purpose.
Application
date (financial
years
beginning)
Expected Impact
1 January 2016 No expected
impact
1 January 2016
Impact first-time
adopters only
1 January 2016 No impact
1 January 2016 Minimal impact
Indoor Skydive Australia Group Limited
2016 Annual Report
42
Indoor Skydive Australia Group Limited
2016 Annual Report
43
43
| 2016 Annual Report
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Reference
Title
Summary
Application
date (financial
years
beginning)
Expected Impact
1 January 2016 No impact as no
separate FS
prepared
1 January 2018
Impact to be
estimated when
transaction
occurs
This amending standard allows entities to
use the equity method of accounting for
investments in subsidiaries, joint ventures
and associates in their separate financial
statements.
This amending standard requires a full gain
or loss to be recognised when a transaction
involves a business (even if the business is
not housed in a subsidiary), and a partial
gain or loss to be recognised when a
transaction involves assets that do not
constitute a business (even if those assets
are housed in a subsidiary).
AASB 2014-9
AASB 2014-10
AASB 2015-1
Amendments to
Australian
Accounting
Standards – Equity
Method in
Separate Financial
Statements
Amendments to
Australian
Accounting
Standards – Sale or
Contribution of
Assets between an
Investor and its
Associate or Joint
Venture
Amendments to
Australian
Accounting
Standards – Annual
Improvements to
Australian
Accounting
Standards 2012-
2014 Cycle
The Standard makes amendments to various
Australian Accounting Standards arising
from the IASB’s Annual Improvements
process, and editorial corrections.
1 January 2016 No impact
estimated
AASB 2015-9
Amendments to
This Standard inserts scope paragraphs into
1 January 2016 Minimal impact
Notes to the Financial Statements
For the year ended 30 June 2016
Reference
Title
Summary
Expected Impact
Application
date (financial
years
beginning)
AASB 2015-2
Amendments to
The Standard makes amendments to AASB
1 January 2016 Disclosures Only
101 Presentation of Financial Statements
arising from the IASB’s Disclosure Initiative
project.
AASB 2015-5
Amendments to
This Standard makes amendments to AASB
1 January 2016 Not estimated
10, AASB 12 and AASB 128 arising from the
IASB’s narrow scope amendments
associated with Investment Entities.
Australian
Accounting
Standards –
Disclosure
Initiative:
Amendments to
AASB 101
Australian
Accounting
Standards –
Investment
Entities: Applying
the Consolidation
Exception
AASB 2015-10
Amendments to
This Standard defers the application of the
1 January 2016 No impact
Australian
Accounting
AASB 8 Operating Segments and AASB 133
Earnings Per Share, as the AASB
Standards – Scope
inadvertently deleted the scope details from
and Application
Paragraphs
AASB 8 and AASB 133 when moving the
application paragraphs to AASB 1057
Application of Australian Accounting
Standards.
Sale or Contribution of Assets between an
Investor and its Associate or Joint Venture
amendments to AASB 10 and AASB 128 to
1 January 2018.
Australian
Accounting
Standards –
Effective Date of
Amendments to
AASB 10 and AASB
128
44
Indoor Skydive Australia Group Limited
2016 Annual Report
45
Indoor Skydive Australia Group Limited
2016 Annual Report
46
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Reference
Title
Summary
Expected Impact
Application
date (financial
years
beginning)
Reference
Title
Summary
AASB 2014-9
Amendments to
This amending standard allows entities to
1 January 2016 No impact as no
separate FS
prepared
AASB 2015-2
AASB 2014-10
Amendments to
This amending standard requires a full gain
1 January 2018
Impact to be
estimated when
transaction
occurs
AASB 2015-5
AASB 2015-1
Amendments to
The Standard makes amendments to various
1 January 2016 No impact
Australian
Accounting
Australian Accounting Standards arising
from the IASB’s Annual Improvements
Standards – Annual
process, and editorial corrections.
estimated
AASB 2015-9
Australian
Accounting
use the equity method of accounting for
investments in subsidiaries, joint ventures
Standards – Equity
and associates in their separate financial
Method in
Separate Financial
Statements
statements.
Australian
Accounting
or loss to be recognised when a transaction
involves a business (even if the business is
Standards – Sale or
not housed in a subsidiary), and a partial
Contribution of
gain or loss to be recognised when a
Assets between an
transaction involves assets that do not
Investor and its
constitute a business (even if those assets
Associate or Joint
are housed in a subsidiary).
Venture
Improvements to
Australian
Accounting
Standards 2012-
2014 Cycle
AASB 2015-10
Amendments to
Australian
Accounting
Standards –
Disclosure
Initiative:
Amendments to
AASB 101
Amendments to
Australian
Accounting
Standards –
Investment
Entities: Applying
the Consolidation
Exception
Amendments to
Australian
Accounting
Standards – Scope
and Application
Paragraphs
Amendments to
Australian
Accounting
Standards –
Effective Date of
Amendments to
AASB 10 and AASB
128
Application
date (financial
years
beginning)
Expected Impact
1 January 2016 Disclosures Only
The Standard makes amendments to AASB
101 Presentation of Financial Statements
arising from the IASB’s Disclosure Initiative
project.
This Standard makes amendments to AASB
10, AASB 12 and AASB 128 arising from the
IASB’s narrow scope amendments
associated with Investment Entities.
1 January 2016 Not estimated
This Standard inserts scope paragraphs into
AASB 8 Operating Segments and AASB 133
Earnings Per Share, as the AASB
inadvertently deleted the scope details from
AASB 8 and AASB 133 when moving the
application paragraphs to AASB 1057
Application of Australian Accounting
Standards.
This Standard defers the application of the
Sale or Contribution of Assets between an
Investor and its Associate or Joint Venture
amendments to AASB 10 and AASB 128 to
1 January 2018.
1 January 2016 Minimal impact
1 January 2016 No impact
Indoor Skydive Australia Group Limited
2016 Annual Report
45
Indoor Skydive Australia Group Limited
2016 Annual Report
46
45
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
2016-2
Amendments to
This standards amends AASB 107 Statement
1 January
Disclosures
2017
only
Taxes (July 2004) and AASB Income Taxes
(August 2015) to clarify the requirements on
2017
recognition of deferred tax assets for
unrealised losses on debts instruments
measured at fair value
Australian
accounting
Standards –
Recognised to
Deferred tax
Assets for
Unrealised Losses
Australian
accounting
Standards –
Disclosure
Initiatives :
Amendment to
AASB 107
of Cash flow (August 2015) to require
entities preparing financial statements in
accordance with Tier 1 reporting
requirements to provide disclosures that
enables users of financial statement to
evaluate changes in liabilities arising from
financing activities, including both changes
arising from cash flows and non-cash
changes.
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Reference
Title
Summary
Application
date (financial
years
beginning)
Expected Impact
Reference
Title
Summary
Expected Impact
Application
date (financial
years
beginning)
AASB 2015-8
AASB 15
AASB 2014-5
Amendments to
Australian
Accounting
Standards –
Effective Date of
AASB 15
Revenue from
Contracts with
Customers
Amendments to
Australian
Accounting
Standards arising
from AASB 15
AASB 9
Financial
Instruments
AASB 2014-7
Amendments to
Australian
Accounting
Standards arising
from AASB 9
(December 2014)
AASB 16
Leases
This Standard defers the effective date of
AASB 15 Revenue from Contracts with
Customers to 1 January 2018.
1 January 2017 No impact
2016-1
Amendments to
This standard amends AASB 112 Income
1 January
N/A
This Standard establishes principles
(including disclosure requirements) for
reporting useful information about the
nature, amount, timing and uncertainty of
revenue and cash flows arising from an
entity’s contracts with customers.
Consequential amendments arising from the
issuance of AASB 15.
1 January 2018 Not estimated
yet
1 January 2017 Not estimated
yet
This Standard supersedes both AASB 9
(December 2010) and AASB 9 (December
2009) when applied. It introduces a “fair
value through other comprehensive
income” category for debt instruments,
contains requirements for impairment of
financial assets, etc.
Consequential amendments arising from the
issuance of AASB 9
1 January 2018 Minimal impact
1 January 2018 Minimal impact
This standard is applicable to annual
reporting periods beginning on or after 1
January 2019. The standard replaces AASB
117 'Leases' and for lessees will eliminate
the classifications of operating leases and
finance leases.
1 January 2019 Not estimated
yet
46
Indoor Skydive Australia Group Limited
2016 Annual Report
47
Indoor Skydive Australia Group Limited
2016 Annual Report
48
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT)
Reference
Title
Summary
Expected Impact
Reference
Title
Summary
Application
date (financial
years
beginning)
Amendments to
Australian
accounting
Standards –
Recognised to
Deferred tax
Assets for
Unrealised Losses
Amendments to
Australian
accounting
Standards –
Disclosure
Initiatives :
Amendment to
AASB 107
This standard amends AASB 112 Income
Taxes (July 2004) and AASB Income Taxes
(August 2015) to clarify the requirements on
recognition of deferred tax assets for
unrealised losses on debts instruments
measured at fair value
This standards amends AASB 107 Statement
of Cash flow (August 2015) to require
entities preparing financial statements in
accordance with Tier 1 reporting
requirements to provide disclosures that
enables users of financial statement to
evaluate changes in liabilities arising from
financing activities, including both changes
arising from cash flows and non-cash
changes.
AASB 2015-8
Amendments to
This Standard defers the effective date of
1 January 2017 No impact
2016-1
AASB 15 Revenue from Contracts with
Customers to 1 January 2018.
AASB 15
This Standard establishes principles
1 January 2018 Not estimated
2016-2
AASB 2014-5
Amendments to
Consequential amendments arising from the
1 January 2017 Not estimated
Australian
Accounting
Standards –
Effective Date of
AASB 15
Revenue from
Contracts with
Customers
Australian
Accounting
Standards arising
from AASB 15
Financial
Instruments
Australian
Accounting
Standards arising
from AASB 9
(December 2014)
(including disclosure requirements) for
reporting useful information about the
nature, amount, timing and uncertainty of
revenue and cash flows arising from an
entity’s contracts with customers.
issuance of AASB 15.
(December 2010) and AASB 9 (December
2009) when applied. It introduces a “fair
value through other comprehensive
income” category for debt instruments,
contains requirements for impairment of
financial assets, etc.
issuance of AASB 9
reporting periods beginning on or after 1
January 2019. The standard replaces AASB
117 'Leases' and for lessees will eliminate
the classifications of operating leases and
finance leases.
AASB 9
This Standard supersedes both AASB 9
1 January 2018 Minimal impact
AASB 2014-7
Amendments to
Consequential amendments arising from the
1 January 2018 Minimal impact
AASB 16
Leases
This standard is applicable to annual
1 January 2019 Not estimated
yet
yet
yet
Application
date (financial
years
beginning)
Expected Impact
1 January
2017
N/A
1 January
2017
Disclosures
only
Indoor Skydive Australia Group Limited
2016 Annual Report
47
Indoor Skydive Australia Group Limited
2016 Annual Report
48
47
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 2: PARENT INFORMATION
NOTE 2: PARENT INFORMATION (CONT)
The following information has been extracted from the books and
records of the parent 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
Equity
Issued capital
Share based payments reserve
Retained earnings
Total Equity
2016
$
2015
$
2,344,392
6,314,769
32,189,899
20,607,847
34,534,291
26,922,616
1,042,041
401,990
8,436,342
-
9,478,383
401,990
34,648,255
33,639,481
658,164
1,185,050
(10,250,511)
(8,303,905)
25,055,908
26,520,626
Statement of Profit or Loss and Other Comprehensive Income
Total loss before tax
Total comprehensive loss
(2,012,577)
(4,167,404)
(2,012,577)
(4,167,404)
48
Indoor Skydive Australia Group Limited
2016 Annual Report
48
Notes to the Financial Statements
For the year ended 30 June 2016
The parent entity does not have any guarantees as at 30 June 2016.
Guarantees
Contingent liabilities
The parent entity does not have any contingent liabilities as at 30 June 2016.
Contractual commitments
Other than amounts disclosed in the financial statements, the parent entity has no additional
contractual commitments as at 30 June 2016.
NOTE 3: SALES REVENUE
VWT revenue
Other sales
2016
$
2015
$
7,911,912
6,140,502
243,976
290,942
8,155,888
6,431,444
Indoor Skydive Australia Group Limited
2016 Annual Report
50
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 2: PARENT INFORMATION (CONT)
2016
$
2015
$
Guarantees
The parent entity does not have any guarantees as at 30 June 2016.
Contingent liabilities
The parent entity does not have any contingent liabilities as at 30 June 2016.
Contractual commitments
Other than amounts disclosed in the financial statements, the parent entity has no additional
contractual commitments as at 30 June 2016.
NOTE 3: SALES REVENUE
VWT revenue
Other sales
2016
$
7,911,912
243,976
8,155,888
2015
$
6,140,502
290,942
6,431,444
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 2: PARENT INFORMATION
The following information has been extracted from the books and
records of the parent 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
Share based payments reserve
Equity
Issued capital
Retained earnings
Total Equity
2,344,392
6,314,769
32,189,899
20,607,847
34,534,291
26,922,616
1,042,041
401,990
8,436,342
-
9,478,383
401,990
34,648,255
33,639,481
658,164
1,185,050
(10,250,511)
(8,303,905)
25,055,908
26,520,626
Statement of Profit or Loss and Other Comprehensive Income
Total loss before tax
Total comprehensive loss
(2,012,577)
(4,167,404)
(2,012,577)
(4,167,404)
Indoor Skydive Australia Group Limited
48
2016 Annual Report
Indoor Skydive Australia Group Limited
2016 Annual Report
50
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| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 4: INCOME TAX EXPENSE
A reconciliation of income tax expense applicable to accounting loss before income tax at the statutory
income tax rate to income tax expense at the company’s effective income tax rate for the year ended
30 June 2016 and 30 June 2015 is as follows:
Accounting loss before income tax
2016
2015
Restated
$
$
(1,485,061)
(2,186,234)
At the statutory income tax rate of 30% (2015: 30%)
Permanent differences
(445,519)
(655,870)
246,454
571,966
Tax effect on temporary and timing differences not brought to account
(71,102)
(169,939)
Income tax benefit not brought to account
Income Tax Benefit
100,009
(28,470)
(170,158)
(282,313)
Deferred tax assets (timing difference) comprises of:
Total VWT Equipment and Building Infrastructure
28,006,951
14,380,543
Black hole expenditure
Unrealised gain and losses
Provisions and others
Deferred tax asset (timing difference) brought to account
Deferred tax asset (tax losses) brought to account
Adjustment relates to prior year misstatement
208,330
-
181,750
314,992
(17,550)
137,504
390,080
434,946
1,454,082
1,239,059
Total deferred tax bought into account
1,844,162
1,674,004
NOTE 5: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
2016
2015
$
$
2,550,601
4,321,619
2,550,601
4,321,619
The above cash balance excludes term deposits held as at 30 June 2016 (2015: $1,325,556)
50
Indoor Skydive Australia Group Limited
2016 Annual Report
51
Indoor Skydive Australia Group Limited
2016 Annual Report
51
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 6: TRADE RECEIVABLES AND OTHER ASSETS
Trade receivables
Inventory
Other receivables
Prepaid expenses
NOTE 7: PROPERTY, PLANT AND EQUIPMENT
VWT Equipment and Building Infrastructure (Operational)
At cost
Accumulated depreciation
2016
$
48,320
59,794
184,705
455,500
748,319
2015
Restated
$
59,375
44,927
501,959
-
606,261
2016
2015
$
Restated
$
29,451,360
15,072,403
(1,444,409)
(691,860)
1,533,491
-
1,533,491
-
-
-
7,727,127
8,749,084
802,644
751,471
8,529,771
9,500,555
39,514,622
24,572,958
(1,444,409)
(691,860)
38,070,213
23,881,098
Provision for Site Restoration of the VWT Equipment and Building
Infrastructure on Termination of Lease
At cost
Accumulated depreciation
Total Provision for Site Restoration of the VWT Equipment and Building
Infrastructure
VWT Construction Work in Progress
VWT Equipment and Building Infrastructure under construction
VWT deposits paid
Total Construction Work in Progress
As construction commences on a facility, the balance is transferred from VWT deposits paid to VWT
Equipment and Building Infrastructure under construction.
Total
At cost
Total
Accumulated depreciation
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 4: INCOME TAX EXPENSE
A reconciliation of income tax expense applicable to accounting loss before income tax at the statutory
income tax rate to income tax expense at the company’s effective income tax rate for the year ended
30 June 2016 and 30 June 2015 is as follows:
Tax effect on temporary and timing differences not brought to account
(71,102)
(169,939)
Accounting loss before income tax
At the statutory income tax rate of 30% (2015: 30%)
Permanent differences
Income tax benefit not brought to account
Income Tax Benefit
Black hole expenditure
Unrealised gain and losses
Provisions and others
NOTE 5: CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Deferred tax asset (timing difference) brought to account
Deferred tax asset (tax losses) brought to account
Adjustment relates to prior year misstatement
Total deferred tax bought into account
1,844,162
1,674,004
2016
2015
Restated
$
$
(1,485,061)
(2,186,234)
(445,519)
(655,870)
246,454
571,966
100,009
(28,470)
(170,158)
(282,313)
208,330
-
181,750
314,992
(17,550)
137,504
390,080
434,946
1,454,082
1,239,059
2016
2015
$
$
2,550,601
4,321,619
2,550,601
4,321,619
The above cash balance excludes term deposits held as at 30 June 2016 (2015: $1,325,556)
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 6: TRADE RECEIVABLES AND OTHER ASSETS
Trade receivables
Inventory
Other receivables
Prepaid expenses
NOTE 7: PROPERTY, PLANT AND EQUIPMENT
VWT Equipment and Building Infrastructure (Operational)
At cost
Accumulated depreciation
2016
$
48,320
59,794
184,705
455,500
748,319
2015
Restated
$
59,375
44,927
501,959
-
606,261
2016
2015
$
Restated
$
29,451,360
(1,444,409)
15,072,403
(691,860)
Deferred tax assets (timing difference) comprises of:
Total VWT Equipment and Building Infrastructure
28,006,951
14,380,543
Provision for Site Restoration of the VWT Equipment and Building
Infrastructure on Termination of Lease
At cost
Accumulated depreciation
Total Provision for Site Restoration of the VWT Equipment and Building
Infrastructure
VWT Construction Work in Progress
VWT Equipment and Building Infrastructure under construction
VWT deposits paid
Total Construction Work in Progress
1,533,491
-
1,533,491
-
-
-
7,727,127
802,644
8,749,084
751,471
8,529,771
9,500,555
As construction commences on a facility, the balance is transferred from VWT deposits paid to VWT
Equipment and Building Infrastructure under construction.
Total
At cost
Accumulated depreciation
Total
39,514,622
(1,444,409)
24,572,958
(691,860)
38,070,213
23,881,098
Indoor Skydive Australia Group Limited
2016 Annual Report
51
Indoor Skydive Australia Group Limited
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51
51
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 9: INTANGIBLE ASSET
Exclusive Territory Development Agreement
1,500,000
1,500,000
Accumulated amortisation
(1,073,622)
(789,370)
2016
$
2015
$
426,378
710,630
2016
$
2015
$
710,630
1,184,384
(284,252)
(473,754)
426,378
710,630
Movements in Carrying Amounts
Opening carrying value
Amortisation
Closing carrying value
The intangible asset was acquired during the 2014 year and was valued at cost. The fair value of
$1,500,000 at acquisition represents the value of the shares granted to iFly Australia Pty Limited under
the Exclusive Joint Territory Agreement, being 2,500,000 shares at a close price of $0.60 on grant date
(20 December 2013).
under the agreement.
An accelerated amortisation rate of 40% has been used against this intangible asset, amortised from 20
December 2013. An accelerated method has been used to reflect the expected consumption of benefits
NOTE 7: PROPERTY PLANT AND EQUIPMENT (CONT)
a.
Movements in Carrying Amounts
VWT
Equipment
Building
Infrastructure
$
14,383,459
570,944
Provision for Site
Restoration of
VWT Equipment
and Building
Infrastructure
VWT
Construction
Work In
Progress
Total
$
2,037,076
$
806,994
$
17,227,529
-
8,693,559
9,264,503
-
(2,144,290)
(573,860)
107,214
-
-
(2,144,290)
(466,646)
14,380,543
14,380,641
(754,233)
28,006,951
-
9,500,553
23,881,096
1,533,491
-
1,533,491
(970,782)
-
8,529,771
14,943,350
(754,233)
38,070,213
Consolidated Group:
Balance at 1 July 2014
Additions
Write back for site
restoration
Depreciation expense
Balance at 1 July 2015
Restated
Additions
Depreciation expense
Balance at 30 June 2016
NOTE 8: INTEREST IN SUBSIDIARIES
Set out below are the Group’s subsidiaries at 30 June 2016. The subsidiaries listed below have share capital
consisting solely of ordinary shares, which are held directly by the Group and the proportion of ownership
interests held equals the voting rights held by the Group. Each subsidiary’s country of incorporation or
registration is also its principal country of business.
Subsidiaries
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
Country of
Incorporation
Australia
Australia
Australia
Australia
Australia
Australia
Australia
2016
%
100
100
100
100
100
100
100
2015
%
100
100
100
100
100
100
100
52
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2016 Annual Report
52
Indoor Skydive Australia Group Limited
2016 Annual Report
54
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 7: PROPERTY PLANT AND EQUIPMENT (CONT)
a.
Movements in Carrying Amounts
VWT
Equipment
Building
Infrastructure
Provision for Site
Restoration of
VWT Equipment
and Building
Infrastructure
VWT
Construction
Work In
Progress
Total
$
$
$
$
14,383,459
2,037,076
806,994
17,227,529
570,944
-
8,693,559
9,264,503
-
(2,144,290)
(573,860)
107,214
(2,144,290)
(466,646)
14,380,543
14,380,641
(754,233)
28,006,951
-
-
9,500,553
23,881,096
1,533,491
(970,782)
14,943,350
1,533,491
8,529,771
38,070,213
(754,233)
-
-
-
Consolidated Group:
Balance at 1 July 2014
Additions
Write back for site
restoration
Depreciation expense
Balance at 1 July 2015
Restated
Additions
Depreciation expense
Balance at 30 June 2016
NOTE 8: INTEREST IN SUBSIDIARIES
Set out below are the Group’s subsidiaries at 30 June 2016. The subsidiaries listed below have share capital
consisting solely of ordinary shares, which are held directly by the Group and the proportion of ownership
interests held equals the voting rights held by the Group. Each subsidiary’s country of incorporation or
registration is also its principal country of business.
Subsidiaries
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
Country of
Incorporation
2016
2015
Australia
Australia
Australia
Australia
Australia
Australia
Australia
%
100
100
100
100
100
100
100
%
100
100
100
100
100
100
100
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 9: INTANGIBLE ASSET
Exclusive Territory Development Agreement
1,500,000
1,500,000
Accumulated amortisation
(1,073,622)
(789,370)
2016
$
2015
$
Movements in Carrying Amounts
Opening carrying value
Amortisation
Closing carrying value
426,378
710,630
2016
$
2015
$
710,630
1,184,384
(284,252)
(473,754)
426,378
710,630
The intangible asset was acquired during the 2014 year and was valued at cost. The fair value of
$1,500,000 at acquisition represents the value of the shares granted to iFly Australia Pty Limited under
the Exclusive Joint Territory Agreement, being 2,500,000 shares at a close price of $0.60 on grant date
(20 December 2013).
An accelerated amortisation rate of 40% has been used against this intangible asset, amortised from 20
December 2013. An accelerated method has been used to reflect the expected consumption of benefits
under the agreement.
Indoor Skydive Australia Group Limited
2016 Annual Report
52
Indoor Skydive Australia Group Limited
2016 Annual Report
54
53
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Deferred revenue primarily represents prepaid sales in respect of flight time purchased in advance. The sales are
released to revenue at the time the services are rendered other than breakage which is recognised as per Note
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 12: DEFERRED REVENUE
Deferred revenue
1(r)(iv).
NOTE 13: BORROWINGS
Current Liabilities
Westpac debt facility
Non - Current Liabilities
Westpac debt facility
2016
2015
$
$
1,016,439
1,280,530
1,016,439
1,280,530
2016
$
2015
$
711,584
711,584
8,436,342
8,436,342
-
-
-
-
NOTE 10: TRADE AND OTHER PAYABLES
Trade payables
Other payables and accruals
2016
$
2,561,130
884,058
3,445,188
2015
$
1,602,493
440,355
2,042,848
During the period, iFly Australia Pty Ltd exercised their rights under the Exclusive Territory Development
Agreement to invest up to $1,000,000 in a subsidiary of the Company, Indoor Skydiving Perth Pty Ltd. The
investment has been agreed to be set off against amounts owed to iFly Australia Pty Ltd for the purchase of
equipment. As shares in the subsidiary have not yet been issued a non-controlling interest in the Group has
not been recognised in the Group balance sheet as at the reporting date and is included in trade payables
above. This is a separate transaction to the $1,000,000 investment made on similar basis by iFly Australia Pty
Ltd in relation to Indoor Skydiving Gold Coast Pty Ltd in 2015 financial year. The shares of which are yet to
be issued. Included in the balance above is therefore $2,000,000 which is expected to be settled through the
issue of equity in subsidiaries.
NOTE 11: PROVISIONS - CURRENT
Provision for Employee Benefits
Opening balance
Additional provisions
Amounts used
2016
$
2015
$
109,683
65,187
269,294
233,225
(183,717)
(188,729)
Closing balance – Provision for employee entitlements
195,260
109,683
The Company has in place a $11.15m secured debt facility with Westpac Banking Corporation. Interest payable on
each component is based on current market rates, over a maximum 5 year term. Security provided is:
Provisions for employee benefits represent amounts accrued for annual leave.
The current portion for this provision includes the total amount accrued for annual leave entitlements that
have vested due to employees having completed the required period of service. Based on past experience, the
Group does not expect the full amount of annual leave balances classified as current liabilities to be settled
within the next 12 months. However, these amounts must be classified as current liabilities since the Group
does not have an unconditional right to defer the settlement of these amounts in the event employees wish to
use their leave entitlement.
Fully Interlocking Guarantee and Indemnity by:
Indoor Skydive Australia Group Limited
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
54
Indoor Skydive Australia Group Limited
2016 Annual Report
55
Indoor Skydive Australia Group Limited
2016 Annual Report
55
2016 Annual Report |
During the period, iFly Australia Pty Ltd exercised their rights under the Exclusive Territory Development
Agreement to invest up to $1,000,000 in a subsidiary of the Company, Indoor Skydiving Perth Pty Ltd. The
investment has been agreed to be set off against amounts owed to iFly Australia Pty Ltd for the purchase of
equipment. As shares in the subsidiary have not yet been issued a non-controlling interest in the Group has
not been recognised in the Group balance sheet as at the reporting date and is included in trade payables
above. This is a separate transaction to the $1,000,000 investment made on similar basis by iFly Australia Pty
Ltd in relation to Indoor Skydiving Gold Coast Pty Ltd in 2015 financial year. The shares of which are yet to
be issued. Included in the balance above is therefore $2,000,000 which is expected to be settled through the
issue of equity in subsidiaries.
NOTE 11: PROVISIONS - CURRENT
Provision for Employee Benefits
Opening balance
Additional provisions
Amounts used
2016
$
2015
$
109,683
65,187
269,294
233,225
(183,717)
(188,729)
Provisions for employee benefits represent amounts accrued for annual leave.
The current portion for this provision includes the total amount accrued for annual leave entitlements that
have vested due to employees having completed the required period of service. Based on past experience, the
Group does not expect the full amount of annual leave balances classified as current liabilities to be settled
within the next 12 months. However, these amounts must be classified as current liabilities since the Group
does not have an unconditional right to defer the settlement of these amounts in the event employees wish to
use their leave entitlement.
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 10: TRADE AND OTHER PAYABLES
Trade payables
Other payables and accruals
2016
$
2,561,130
884,058
3,445,188
2015
$
1,602,493
440,355
2,042,848
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 12: DEFERRED REVENUE
Deferred revenue
2016
2015
$
$
1,016,439
1,280,530
1,016,439
1,280,530
Deferred revenue primarily represents prepaid sales in respect of flight time purchased in advance. The sales are
released to revenue at the time the services are rendered other than breakage which is recognised as per Note
1(r)(iv).
NOTE 13: BORROWINGS
Current Liabilities
Westpac debt facility
Non - Current Liabilities
Westpac debt facility
2016
$
2015
$
711,584
711,584
8,436,342
8,436,342
-
-
-
-
Closing balance – Provision for employee entitlements
195,260
109,683
The Company has in place a $11.15m secured debt facility with Westpac Banking Corporation. Interest payable on
each component is based on current market rates, over a maximum 5 year term. Security provided is:
Fully Interlocking Guarantee and Indemnity by:
Indoor Skydive Australia Group Limited
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
Indoor Skydive Australia Group Limited
2016 Annual Report
55
Indoor Skydive Australia Group Limited
2016 Annual Report
55
55
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 13: BORROWINGS (CONT)
Supported by General Security Agreement over all existing and future assets and undertaking by:
Indoor Skydive Australia Group Limited
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
Mortgage over lease by Indoor Skydiving Penrith Holdings Pty Ltd.
Flawed Asset Arrangement – deposits by Indoor Skydiving Penrith Holdings Pty Ltd over deposit accounts held
with Westpac Banking Corporation
Ordinary Shares
At the beginning of the reporting period
· Shares issued during the period
· Share based payments
56
Indoor Skydive Australia Group Limited
2016 Annual Report
56
Indoor Skydive Australia Group Limited
2016 Annual Report
58
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 14: ISSUED CAPITAL
120,193,004 (2015: 118,974,294) fully paid ordinary shares
Share issue costs
2016
$
2015
$
36,298,770
(1,650,315)
35,289,996
(1,650,315)
34,648,455
33,639,681
2016
No.
118,974,294
-
1,218,710
2015
No.
87,305,666
28,907,492
2,761,136
120,193,004
118,974,294
2016
2015*
350,000
2,027,167
(96,673)
2,961,136
-
-
(1,218,710)
(2,611,136)
1,061,784
350,000
b. Performance Rights
At the beginning of the reporting period:
Performance rights issued during the year
Performance rights lapsed during the year
Performance rights exercised during the year
* 2015 Comparatives amended as previously calculated on Approved Plan values rather than issued
values.
2016 values include 85,000 Conditional Rights issued and exercised during the year.
Performance rights are provided to certain employees (including key management personnel) via the Indoor Skydive
Australia Group Limited Performance Rights Plan. The fair value is measured at grant date and is recognised over
the period the services are received, which is the expected vesting period during which the employees would
become entitled to exercise the performance rights.
c.
Capital Management
The Board controls the capital of the Group in order to generate long-term shareholder value and to ensure that the
Group can fund its operations and continue as a going concern. The Board assesses the Group’s capital requirements
based on the Company’s stage of operations, having regard to available debt funding and equity funding and seek to
maintain a capital structure based on the lowest cost of capital available to the Group. The Board achieves this
through the internal generation of capital and the management of debt levels and, if necessary, share issues.
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 13: BORROWINGS (CONT)
Supported by General Security Agreement over all existing and future assets and undertaking by:
Indoor Skydive Australia Group Limited
Indoor Skydiving Penrith Holdings Pty Ltd
Indoor Skydiving Penrith Pty Ltd
Indoor Skydiving Gold Coast Pty Ltd
Indoor Skydiving Adelaide Pty Ltd
Indoor Skydiving Perth Pty Ltd
ISAG Holdings D Pty Ltd
ISAG Café Pty Ltd
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 14: ISSUED CAPITAL
2016
$
2015
$
120,193,004 (2015: 118,974,294) fully paid ordinary shares
Share issue costs
36,298,770
(1,650,315)
35,289,996
(1,650,315)
Mortgage over lease by Indoor Skydiving Penrith Holdings Pty Ltd.
Flawed Asset Arrangement – deposits by Indoor Skydiving Penrith Holdings Pty Ltd over deposit accounts held
with Westpac Banking Corporation
Ordinary Shares
At the beginning of the reporting period
· Shares issued during the period
· Share based payments
b. Performance Rights
At the beginning of the reporting period:
Performance rights issued during the year
Performance rights lapsed during the year
Performance rights exercised during the year
34,648,455
33,639,681
2016
No.
118,974,294
-
1,218,710
2015
No.
87,305,666
28,907,492
2,761,136
120,193,004
118,974,294
2016
2015*
350,000
2,027,167
(96,673)
(1,218,710)
1,061,784
-
2,961,136
-
(2,611,136)
350,000
* 2015 Comparatives amended as previously calculated on Approved Plan values rather than issued
values.
2016 values include 85,000 Conditional Rights issued and exercised during the year.
Performance rights are provided to certain employees (including key management personnel) via the Indoor Skydive
Australia Group Limited Performance Rights Plan. The fair value is measured at grant date and is recognised over
the period the services are received, which is the expected vesting period during which the employees would
become entitled to exercise the performance rights.
c.
Capital Management
The Board controls the capital of the Group in order to generate long-term shareholder value and to ensure that the
Group can fund its operations and continue as a going concern. The Board assesses the Group’s capital requirements
based on the Company’s stage of operations, having regard to available debt funding and equity funding and seek to
maintain a capital structure based on the lowest cost of capital available to the Group. The Board achieves this
through the internal generation of capital and the management of debt levels and, if necessary, share issues.
Indoor Skydive Australia Group Limited
2016 Annual Report
56
Indoor Skydive Australia Group Limited
2016 Annual Report
58
57
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 16: CASH FLOW INFORMATION
Reconciliation of Cash Flow from Operations with Loss after Income Tax
Loss after income tax
Non-cash flows in loss:
- Share based payments
- Gain on FX revaluation
- Unwind of make good discount
- Depreciation expense
- Amortisation expense
Changes in assets and liabilities:
2016
2015
Restated
$
$
(1,314,903)
(1,903,921)
481,888
1,423,122
(136,639)
-
740,924
345,842
(62,519)
(53,607)
467,968
473,754
- (increase)/decrease in trade and term receivables
241,335
(798,127)
- (increase)/decrease in prepaid expenses
-
104,200
- (increase)/decrease in other financial assets
72,107
-
- (increase)/decrease in deferred tax asset
- increase/(decrease) in trade payables and accruals
- increase/(decrease) in unearned revenue
- increase/(decrease) in provisions
Cash flow provided by operations
(170,158)
191,239
(264,091)
85,577
273,120
282,313
106,158
379,493
44,497
463,331
NOTE 15: CAPITAL AND LEASING COMMITMENTS
2016
$
2015
$
a. Operating Lease Commitments
Non-cancellable operating leases contracted for but not recognised
in the financial statements
Payable – minimum lease payments:
- Not later than 12 months
- Between 12 months and five years
- Later than five years
b. Capital Commitments
892,765
580,793
3,396,091
3,015,074
11,590,051
11,461,155
15,878,907
15,057,022
2016
$
2015
$
Subsidiary capital commitments contracted for but not recognised
in the financial statements
6,857,855
2,425,130
6,857,855
2,425,130
58
Indoor Skydive Australia Group Limited
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59
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 15: CAPITAL AND LEASING COMMITMENTS
a. Operating Lease Commitments
Non-cancellable operating leases contracted for but not recognised
in the financial statements
Payable – minimum lease payments:
- Not later than 12 months
- Between 12 months and five years
- Later than five years
b. Capital Commitments
2016
$
2015
$
892,765
580,793
3,396,091
3,015,074
11,590,051
11,461,155
15,878,907
15,057,022
2016
$
2015
$
6,857,855
2,425,130
Subsidiary capital commitments contracted for but not recognised
in the financial statements
6,857,855
2,425,130
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 16: CASH FLOW INFORMATION
Reconciliation of Cash Flow from Operations with Loss after Income Tax
2016
2015
Restated
$
$
Loss after income tax
Non-cash flows in loss:
- Share based payments
- Gain on FX revaluation
- Unwind of make good discount
- Depreciation expense
- Amortisation expense
Changes in assets and liabilities:
(1,314,903)
(1,903,921)
481,888
1,423,122
(136,639)
-
740,924
345,842
(62,519)
(53,607)
467,968
473,754
- (increase)/decrease in trade and term receivables
241,335
(798,127)
- (increase)/decrease in prepaid expenses
-
104,200
- (increase)/decrease in other financial assets
72,107
-
- (increase)/decrease in deferred tax asset
- increase/(decrease) in trade payables and accruals
- increase/(decrease) in unearned revenue
- increase/(decrease) in provisions
Cash flow provided by operations
(170,158)
191,239
(264,091)
85,577
273,120
282,313
106,158
379,493
44,497
463,331
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| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 17: RELATED PARTY TRANSACTIONS
a. The Group’s main related parties are as follows:
(i)
Entities exercising control over the Group:
There is no ultimate parent entity that exercises control over the Group.
(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 the Remuneration
Report.
(iii)
Entities subject to significant influence by the Group:
An entity that has the power to participate in the financial and operating policy decisions of an
entity, but does not have control over those policies, is an entity which holds significant
influence. Significant influence may be gained by share ownership, statute or agreement.
There are no such entities in the Group.
(iv) Other related parties:
Other related parties include entities controlled by the ultimate parent entity and entities over
which key management personnel have joint control.
-
The entities disclosed in Note 8 are 100% owned subsidiary companies of the parent
entity.
b. Transactions with related parties:
Balances and transactions between the Company and its subsidiaries, which are related parties of the
Company, have been eliminated on consolidation and are not disclosed in this Note. Details of transactions
between the Group and other related parties are disclosed below.
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 table provides the total amount
of transactions that have been entered into with related parties for the financial year:
Associates
Birkdale Holdings (Qld) Pty Ltd
2016
Payments to
related parties
-
2015
244,402
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62
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 18: SHARE BASED PAYMENTS
The following Share Based Payments were expensed during the period:
2016
$
2015
$
– Net amounts credited to the share based payment reserve (in respect of
737,038
1,432,122
performance rights)
737,038
1,423,122
On 27 November 2013 shareholders approved the Indoor Skydive Australia Group Limited Performance Rights Plan
(Plan) at the 2013 Annual General Meeting. The Plan allows for the grant of performance rights to Directors and
employees as part of the Company’s remuneration strategy. The performance rights carry neither rights to
dividends, nor voting rights and may be exercised at any time from the date of vesting to the date of their expiry.
Measurement of fair values
(i)
Equity-Settled Share-Based Payment Arrangements
The fair value of equity instruments granted under the Plan has been, where appropriate, calculated using
a binominal approximation option pricing model. Service and non-market performance conditions
attached to the approvals or grants were not taken into account in determining the fair value.
Where performance rights that were immediately exercised were granted, the fair value of the equity
instrument was calculated with reference to the 5 day VWAP of IDZ shares on the transaction date.
The inputs used in the calculation of the fair value at grant (or approval) date of the Equity-settled share-
based payments were as follows:
27 November 2013
27 November 2013
7 July 2014
Fair Value at grant/approval date
(weighted average)
Share Price at grant/approval date
Exercise Price
Expected Volatility
Expected life (weighted average
number of days)
Expected dividends
Risk-free rate (weighted average)
5 day VWAP
$0.59
$0.59
$0.00
50%
956
0%
2.95%
N/A
$0.59
$0.59
$0.00
50%
307
0%
2.69%
N/A
$0.68
$0.68
$0.00
50%
358
0%
2.58%
$0.68
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 17: RELATED PARTY TRANSACTIONS
a. The Group’s main related parties are as follows:
(i)
Entities exercising control over the Group:
There is no ultimate parent entity that exercises control over the Group.
(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 the Remuneration
Report.
(iii)
Entities subject to significant influence by the Group:
An entity that has the power to participate in the financial and operating policy decisions of an
entity, but does not have control over those policies, is an entity which holds significant
influence. Significant influence may be gained by share ownership, statute or agreement.
There are no such entities in the Group.
(iv) Other related parties:
Other related parties include entities controlled by the ultimate parent entity and entities over
which key management personnel have joint control.
-
The entities disclosed in Note 8 are 100% owned subsidiary companies of the parent
entity.
b. Transactions with related parties:
Balances and transactions between the Company and its subsidiaries, which are related parties of the
Company, have been eliminated on consolidation and are not disclosed in this Note. Details of transactions
between the Group and other related parties are disclosed below.
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 table provides the total amount
of transactions that have been entered into with related parties for the financial year:
Associates
Birkdale Holdings (Qld) Pty Ltd
2016
-
Payments to
related parties
2015
244,402
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 18: SHARE BASED PAYMENTS
The following Share Based Payments were expensed during the period:
– Net amounts credited to the share based payment reserve (in respect of
performance rights)
2016
$
2015
$
737,038
1,432,122
737,038
1,423,122
On 27 November 2013 shareholders approved the Indoor Skydive Australia Group Limited Performance Rights Plan
(Plan) at the 2013 Annual General Meeting. The Plan allows for the grant of performance rights to Directors and
employees as part of the Company’s remuneration strategy. The performance rights carry neither rights to
dividends, nor voting rights and may be exercised at any time from the date of vesting to the date of their expiry.
Measurement of fair values
(i)
Equity-Settled Share-Based Payment Arrangements
The fair value of equity instruments granted under the Plan has been, where appropriate, calculated using
a binominal approximation option pricing model. Service and non-market performance conditions
attached to the approvals or grants were not taken into account in determining the fair value.
Where performance rights that were immediately exercised were granted, the fair value of the equity
instrument was calculated with reference to the 5 day VWAP of IDZ shares on the transaction date.
The inputs used in the calculation of the fair value at grant (or approval) date of the Equity-settled share-
based payments were as follows:
27 November 2013
27 November 2013
7 July 2014
Fair Value at grant/approval date
(weighted average)
Share Price at grant/approval date
Exercise Price
Expected Volatility
Expected life (weighted average
number of days)
Expected dividends
Risk-free rate (weighted average)
5 day VWAP
$0.59
$0.59
$0.00
50%
956
0%
2.95%
N/A
$0.59
$0.59
$0.00
50%
307
0%
2.69%
N/A
$0.68
$0.68
$0.00
50%
358
0%
2.58%
$0.68
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| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 18: SHARE BASED PAYMENTS (CONT)
Reconciliation of outstanding share options
The number and weighted-average exercise prices of equity instruments granted under the Plan were as follows:
Number of rights
Weighted-average exercise price
350,000
2,027,167
(96,673)
(1,218,708)
1,061,784
0
0
0
0
0
Outstanding at 30 June 2015
Granted during the year
Forfeited during the year
Exercised during the year
Outstanding as at 30 June 2016
NOTE 19: SEGMENT INFORMATION
General Information
Identification of reportable segments
The Group’s operations are in one business segment being the construction and operation of indoor skydiving
facilities. The Group operates in one geographical segment being Australia. All subsidiaries in the Group operate
within the same segment.
Types of Products and Services by Segment
No collateral is held by the Group securing receivables.
The products and services will include a number of indoor skydiving facilities allowing human flight within a safe
environment used by tourists, enthusiasts and military.
The Group only has significant concentrations of credit risk with any single counterparty in the form of its
bankers, and therefore significant credit risk exposures to Australia.
Basis of Accounting for Purposes of Reporting by Operating Segments
There are no trade and other receivables that are past due nor impaired.
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 these financial statements.
NOTE 20: FINANCIAL RISK MANAGEMENT
Financial Risk Management Policies
The Audit and Risk Committee (A&RC) has been delegated responsibility by the Board of Directors for, among other
issues, managing financial risk exposures of the Group. The A&RC monitors the Group’s financial risk management
policies and exposures and approves financial transactions within the scope of its authority. It also reviews the
effectiveness of internal controls relating to commodity price risk, counterparty credit risk, currency risk, liquidity
risk and interest rate risk. The A&RC meets on a regular basis and minutes of the A&RC are reviewed by the Board.
The A&RC’s overall risk management strategy seeks to assist the Group in meeting its financial targets, while
minimising potential adverse effects on financial performance. Its functions include the review of the use of hedging
derivative instruments, credit risk policies and future cash flow requirements.
62
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64
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
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, foreign currency risk and other price risk (commodity and equity price risk).
There have been no substantive changes in the types of risks the Group is exposed to, how these risks arise, or the
Board’s objectives, policies and processes for managing or measuring the risks from the previous period.
a.
Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counter
parties of contract obligations that could lead to a financial loss to the Group.
Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit
rating, or in entities that the A&RC has otherwise assessed as being financially sound.
Credit risk exposures
position.
The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period
excluding the value of any collateral or other security held, is equivalent to the carrying amount and
classification of those financial assets (net of any provisions) as presented in the statement of financial
Credit risk related to balances with banks and other financial institutions is managed by the A&RC in
accordance with approved Board policy. Such policy requires that surplus funds are only invested with
counterparties with a Standard & Poor’s rating of at least AA–.
The following table provides information regarding the credit risk relating to cash and term deposits based
on Standard & Poor’s counterparty credit ratings.
Cash and Term Deposits:
Cash at bank and on hand
Term deposits
AA- rated
2016
$
2015
$
2,550,601
4,321,619
-
1,325,556
2,550,601
5,647,175
2016 Annual Report |
The number and weighted-average exercise prices of equity instruments granted under the Plan were as follows:
Number of rights
Weighted-average exercise price
350,000
2,027,167
(96,673)
(1,218,708)
1,061,784
0
0
0
0
0
The Group’s operations are in one business segment being the construction and operation of indoor skydiving
facilities. The Group operates in one geographical segment being Australia. All subsidiaries in the Group operate
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 18: SHARE BASED PAYMENTS (CONT)
Reconciliation of outstanding share options
Outstanding at 30 June 2015
Granted during the year
Forfeited during the year
Exercised during the year
Outstanding as at 30 June 2016
NOTE 19: SEGMENT INFORMATION
General Information
Identification of reportable segments
within the same segment.
Types of Products and Services by Segment
Accounting policies adopted
those adopted in these financial statements.
NOTE 20: FINANCIAL RISK MANAGEMENT
Financial Risk Management Policies
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
The Audit and Risk Committee (A&RC) has been delegated responsibility by the Board of Directors for, among other
issues, managing financial risk exposures of the Group. The A&RC monitors the Group’s financial risk management
policies and exposures and approves financial transactions within the scope of its authority. It also reviews the
effectiveness of internal controls relating to commodity price risk, counterparty credit risk, currency risk, liquidity
risk and interest rate risk. The A&RC meets on a regular basis and minutes of the A&RC are reviewed by the Board.
The A&RC’s overall risk management strategy seeks to assist the Group in meeting its financial targets, while
minimising potential adverse effects on financial performance. Its functions include the review of the use of hedging
derivative instruments, credit risk policies and future cash flow requirements.
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
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, foreign currency risk and other price risk (commodity and equity price risk).
There have been no substantive changes in the types of risks the Group is exposed to, how these risks arise, or the
Board’s objectives, policies and processes for managing or measuring the risks from the previous period.
a.
Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counter
parties of contract obligations that could lead to a financial loss to the Group.
Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit
rating, or in entities that the A&RC has otherwise assessed as being financially sound.
Credit risk exposures
The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period
excluding the value of any collateral or other security held, is equivalent to the carrying amount and
classification of those financial assets (net of any provisions) as presented in the statement of financial
position.
No collateral is held by the Group securing receivables.
The products and services will include a number of indoor skydiving facilities allowing human flight within a safe
environment used by tourists, enthusiasts and military.
The Group only has significant concentrations of credit risk with any single counterparty in the form of its
bankers, and therefore significant credit risk exposures to Australia.
Basis of Accounting for Purposes of Reporting by Operating Segments
There are no trade and other receivables that are past due nor impaired.
Credit risk related to balances with banks and other financial institutions is managed by the A&RC in
accordance with approved Board policy. Such policy requires that surplus funds are only invested with
counterparties with a Standard & Poor’s rating of at least AA–.
The following table provides information regarding the credit risk relating to cash and term deposits based
on Standard & Poor’s counterparty credit ratings.
Cash and Term Deposits:
Cash at bank and on hand
Term deposits
AA- rated
2016
$
2015
$
2,550,601
4,321,619
-
1,325,556
2,550,601
5,647,175
Indoor Skydive Australia Group Limited
2016 Annual Report
63
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64
63
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
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 forecasts in relation to its operating, investing and financing
activities;
using derivatives that are only traded in highly liquid markets;
monitoring undrawn credit facilities;
obtaining funding from a variety of sources;
maintaining a reputable credit profile;
managing credit risk related to financial assets;
only investing surplus cash with major financial institutions; and
comparing the maturity profile of financial liabilities with the realisation profile of financial assets.
The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet it liabilities when
they become due.
The table below reflects an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation.
Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to
settle financial liabilities reflects the earliest contractual settlement dates and does not reflect management’s
expectations that banking facilities will be rolled forward.
64
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2016 Annual Report
65
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
Financial liability and financial asset maturity analysis for the Consolidated Group.
Within 1 Year
1 to 5 Years
2016
2015
2016
Restated
2015
Restated
Over 5 Years
2016
2015
Restated
Total
2016
2015
Restated
$
$
$
$
$
$
$
$
Financial
liabilities due for
payment
Borrowings
payables *
outflows
Total expected
outflows
Financial assets
– cash flows
realisable
Cash and cash
equivalents
Term deposits
Trade and other
receivables
inflows
Net inflow on
financial
instruments
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Trade and other
1,445,188
1,042,848
-
711,584
-
8,436,342
9,147,926
1,445,188
-
1,042,848
Total contractual
2,156,772
1,042,848
8,436,342
10,593,114
1,042,848
2,156,772
1,042,848
8,436,342
10,593,114
1,042,848
2,550,601 4,321,619
- 1,325,556
748,319
606,261
-
-
-
-
Total anticipated
3,298,920 6,253,436
2,550,601
4,321,619
-
1,325,556
748,319
606,261
3,298,920
6,253,436
1,141,148 5,210,588 (8,436,342)
-
(7,294,194)
5,210,588
* See note 10, $2,000,000 of the trade payables balance is expected to be settled through equity.
c.
Market risk
(i)
Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the
end of the reporting period whereby a future change in interest rates will affect future cash flows
or the fair value of fixed rate financial instruments. The Group is not exposed to earnings volatility
on floating rate instruments.
The financial instruments that primarily expose the Group to interest rate risk are borrowings,
cash and cash equivalents and term deposits.
Interest rate risk is managed using a mix of fixed and floating rate debt where possible.
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
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:
activities;
preparing forward-looking cash flow forecasts in relation to its operating, investing and financing
using derivatives that are only traded in highly liquid markets;
monitoring undrawn credit facilities;
obtaining funding from a variety of sources;
maintaining a reputable credit profile;
managing credit risk related to financial assets;
–
–
–
–
–
–
–
–
only investing surplus cash with major financial institutions; and
comparing the maturity profile of financial liabilities with the realisation profile of financial assets.
The Group’s policy is to ensure that it will always have sufficient cash to allow it to meet it liabilities when
they become due.
The table below reflects an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation.
Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to
settle financial liabilities reflects the earliest contractual settlement dates and does not reflect management’s
expectations that banking facilities will be rolled forward.
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
Financial liability and financial asset maturity analysis for the Consolidated Group.
Within 1 Year
2016
2015
Restated
1 to 5 Years
2016
2015
Restated
Over 5 Years
2016
2015
Restated
Total
2016
2015
Restated
$
$
$
$
$
$
$
$
711,584
1,445,188
-
1,042,848
8,436,342
-
2,156,772
1,042,848
8,436,342
2,156,772
1,042,848
8,436,342
2,550,601 4,321,619
- 1,325,556
606,261
748,319
3,298,920 6,253,436
-
-
-
-
1,141,148 5,210,588 (8,436,342)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
9,147,926
1,445,188
-
1,042,848
10,593,114
1,042,848
10,593,114
1,042,848
2,550,601
4,321,619
-
748,319
1,325,556
606,261
3,298,920
6,253,436
-
(7,294,194)
5,210,588
Financial
liabilities due for
payment
Borrowings
Trade and other
payables *
Total contractual
outflows
Total expected
outflows
Financial assets
– cash flows
realisable
Cash and cash
equivalents
Term deposits
Trade and other
receivables
Total anticipated
inflows
Net inflow on
financial
instruments
* See note 10, $2,000,000 of the trade payables balance is expected to be settled through equity.
c.
Market risk
(i)
Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the
end of the reporting period whereby a future change in interest rates will affect future cash flows
or the fair value of fixed rate financial instruments. The Group is not exposed to earnings volatility
on floating rate instruments.
The financial instruments that primarily expose the Group to interest rate risk are borrowings,
cash and cash equivalents and term deposits.
Interest rate risk is managed using a mix of fixed and floating rate debt where possible.
Indoor Skydive Australia Group Limited
2016 Annual Report
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65
65
| 2016 Annual Report
ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Profit
$
7,364
87
56,472
24
Equity
$
7,364
87
56,472
24
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
Year ended 30 June 2016
+/–1% in interest rates
+/–10% in devaluation of the AUD
Year ended 30 June 2015
+/–1% in interest rates
+/–10% in devaluation of the AUD
market conditions.
Fair Values
Fair value estimation
There have been no changes in any of the methods or assumptions used to prepare the above sensitivity analysis
from the prior year. These movements are considered to be reasonably possible based on observation of current
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. Fair value is the amount at which an
asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length
Fair values derived may be based on information that is estimated or subject to judgment, where changes in
assumptions may have a material impact on the amounts estimated. Areas of judgement and the assumptions have
been detailed below. Where possible, valuation information used to calculate fair value is extracted from the
market, with more reliable information available from markets that are actively traded. In this regard, fair values
for listed securities are obtained from quoted market bid prices. Where securities are unlisted and no market quotes
are available, fair value is obtained using discounted cash flow analysis and other valuation techniques commonly
used by market participants.
Most of these instruments, which are carried at amortised cost (i.e. term receivables, held-to-maturity assets, loan
liabilities), are to be held until maturity and therefore the fair value figures calculated bear little relevance to the
Group.
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
(ii)
Foreign exchange risk
Most of the Group’s transactions are carried out in AUD. Exposures to currency exchange rates
primarily arise from the purchase of vertical wind tunnel equipment from SkyVenture
International, which is denominated in US dollars.
To mitigate the Group’s exposure to foreign currency risk, non-AUD cash flows are monitored and
forward exchange contracts are entered into in accordance with the Group’s risk management
policies. Forward exchange contracts are mainly entered into for significant long-term foreign
currency exposures that are not expected to be offset by other currency transactions. Exposure
to foreign exchange 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.
(iii) Other price risk
Other price risk relates to the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in market prices largely due to demand and supply factors (other
than those arising from interest rate risk or currency risk) for commodities.
The Group is not exposed to commodity price risk. The Group is not exposed to securities price
risk on investments held for trading over the medium to longer terms.
Sensitivity analysis
transaction.
The following table illustrates sensitivities to the Group’s exposures to changes in interest rates,
and exchange rates. In respect of the exchange rates, the table summarises the sensitivity of the
balance of financial instruments held at the reporting date to movement in the exchange rate of
the US dollar to the Australian dollar, with all other variables held constant. The table indicates
the impact on 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.
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.
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2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
(ii)
Foreign exchange risk
Most of the Group’s transactions are carried out in AUD. Exposures to currency exchange rates
primarily arise from the purchase of vertical wind tunnel equipment from SkyVenture
International, which is denominated in US dollars.
To mitigate the Group’s exposure to foreign currency risk, non-AUD cash flows are monitored and
forward exchange contracts are entered into in accordance with the Group’s risk management
policies. Forward exchange contracts are mainly entered into for significant long-term foreign
currency exposures that are not expected to be offset by other currency transactions. Exposure
to foreign exchange 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.
(iii) Other price risk
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
Year ended 30 June 2016
+/–1% in interest rates
+/–10% in devaluation of the AUD
Year ended 30 June 2015
+/–1% in interest rates
+/–10% in devaluation of the AUD
Profit
$
7,364
87
56,472
24
Equity
$
7,364
87
56,472
24
There have been no changes in any of the methods or assumptions used to prepare the above sensitivity analysis
from the prior year. These movements are considered to be reasonably possible based on observation of current
market conditions.
Other price risk relates to the risk that the fair value or future cash flows of a financial instrument
will fluctuate because of changes in market prices largely due to demand and supply factors (other
than those arising from interest rate risk or currency risk) for commodities.
Fair Values
Fair value estimation
The Group is not exposed to commodity price risk. The Group is not exposed to securities price
risk on investments held for trading over the medium to longer terms.
Sensitivity analysis
reasonably possible.
variables.
The following table illustrates sensitivities to the Group’s exposures to changes in interest rates,
and exchange rates. In respect of the exchange rates, the table summarises the sensitivity of the
balance of financial instruments held at the reporting date to movement in the exchange rate of
the US dollar to the Australian dollar, with all other variables held constant. The table indicates
the impact on 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
These sensitivities assume that the movement in a particular variable is independent of other
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. Fair value is the amount at which an
asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length
transaction.
Fair values derived may be based on information that is estimated or subject to judgment, where changes in
assumptions may have a material impact on the amounts estimated. Areas of judgement and the assumptions have
been detailed below. Where possible, valuation information used to calculate fair value is extracted from the
market, with more reliable information available from markets that are actively traded. In this regard, fair values
for listed securities are obtained from quoted market bid prices. Where securities are unlisted and no market quotes
are available, fair value is obtained using discounted cash flow analysis and other valuation techniques commonly
used by market participants.
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.
Most of these instruments, which are carried at amortised cost (i.e. term receivables, held-to-maturity assets, loan
liabilities), are to be held until maturity and therefore the fair value figures calculated bear little relevance to the
Group.
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ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
Consolidated Group
Note
Financial assets
Cash and cash equivalents
Term deposits
Trade and other receivables
Total financial assets
Financial liabilities
Trade and other payables
Borrowings
(i)
(i)
(i)
(i)
(ii)
2016
2015
Restated
Carrying Amount
$
Fair Value
$
Carrying
Amount
$
Fair Value
$
2,550,601
2,550,601
4,321,619
4,321,619
-
-
1,325,556
1,325,556
748,319
748,319
606,261
606,261
3,298,920
3,298,920
6,253,436
6,253,436
Loss
(1,314,903)
(1,903,921)
a.
Reconciliation of earnings to profit or loss:
3,445,188
3,445,188
2,042,848
2,042,848
Earnings used in the calculation of dilutive EPS
(1,314,903)
(1,903,921)
Earnings used to calculate basic EPS
(1,314,903)
(1,903,921)
9,147,926
9,147,926
-
-
Total financial liabilities
12,593,114
12,593,114
2,042,848
2,042,848
The fair values disclosed in the above table have been determined based on the following methodologies:
Weighted average number of dilutive performance rights
-
-
(i)
Cash and cash equivalents, term deposits, trade and other receivables, and trade and other
payables are short-term instruments in nature whose carrying amount is equivalent to fair
value. Trade and other payables exclude amounts provided for annual leave, which is outside
the scope of AASB 139.
(ii)
Debt is recorded at the current carrying value which is considered equivalent to fair value.
NOTE 21: AUDITOR’S REMUNERATION
Remuneration of the auditor for:
– Audit fees
– Half year review
–
Taxation compliance
– Other advisory services
68
2016
$
2015
$
60,000
45,000
23,000
22,000
3,000
450
7,500
2,340
86,450
76,840
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2016 Annual Report
70
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 22: EARNINGS PER SHARE
Earnings per share (cents per share)
From continuing operations:
basic earnings per share
diluted earnings per share
-
-
2016
Cents
(1.10)
(1.10)
2016
$
2015
Cents
(1.78)
(1.78)
2015
$
b.
Weighted average number of ordinary shares outstanding during
119,673,163
107,101,112
No.
No.
the year used in calculating basic EPS
outstanding
the year used in calculating dilutive EPS
Weighted average number of ordinary shares outstanding during
119,673,163
107,101,112
During the year, 1,942,167 performance rights were granted to employees (including key management personnel)
under the performance rights plan. These rights are considered to be potential ordinary shares, and have not been
included in the determination of basic earnings per share. The performance rights have not been included in the
diluted earnings per share calculation as they are considered to be contingently issuable potential ordinary shares
and their issue is contingent upon specified conditions in addition to the passage of time. Details relating to the
performance rights are set out in Note 14.
NOTE 23: EVENTS AFTER REPORTING DATE
No matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the consolidated group, the results of those operations, or the state of affairs
of the consolidated group in future financial years.
2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 20: FINANCIAL RISK MANAGEMENT (CONT)
2016
Consolidated Group
Note
Carrying Amount
Fair Value
$
$
Financial assets
Cash and cash equivalents
2,550,601
2,550,601
4,321,619
4,321,619
Term deposits
-
-
1,325,556
1,325,556
Trade and other receivables
748,319
748,319
606,261
606,261
2015
Restated
Carrying
Amount
$
Fair Value
$
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 22: EARNINGS PER SHARE
Earnings per share (cents per share)
From continuing operations:
basic earnings per share
-
-
diluted earnings per share
2016
Cents
(1.10)
(1.10)
2016
$
2015
Cents
(1.78)
(1.78)
2015
$
Total financial assets
Financial liabilities
3,298,920
3,298,920
6,253,436
6,253,436
a.
Reconciliation of earnings to profit or loss:
Loss
(1,314,903)
(1,903,921)
Earnings used to calculate basic EPS
(1,314,903)
(1,903,921)
Trade and other payables
3,445,188
3,445,188
2,042,848
2,042,848
Earnings used in the calculation of dilutive EPS
(1,314,903)
(1,903,921)
(i)
(i)
(i)
(i)
(ii)
b.
Weighted average number of ordinary shares outstanding during
the year used in calculating basic EPS
Weighted average number of dilutive performance rights
outstanding
Weighted average number of ordinary shares outstanding during
the year used in calculating dilutive EPS
No.
No.
119,673,163
107,101,112
-
-
119,673,163
107,101,112
During the year, 1,942,167 performance rights were granted to employees (including key management personnel)
under the performance rights plan. These rights are considered to be potential ordinary shares, and have not been
included in the determination of basic earnings per share. The performance rights have not been included in the
diluted earnings per share calculation as they are considered to be contingently issuable potential ordinary shares
and their issue is contingent upon specified conditions in addition to the passage of time. Details relating to the
performance rights are set out in Note 14.
NOTE 23: EVENTS AFTER REPORTING DATE
No matters or circumstances have arisen since the end of the financial year which significantly affected or may
significantly affect the operations of the consolidated group, the results of those operations, or the state of affairs
of the consolidated group in future financial years.
Borrowings
9,147,926
9,147,926
-
-
Total financial liabilities
12,593,114
12,593,114
2,042,848
2,042,848
The fair values disclosed in the above table have been determined based on the following methodologies:
(i)
Cash and cash equivalents, term deposits, trade and other receivables, and trade and other
payables are short-term instruments in nature whose carrying amount is equivalent to fair
value. Trade and other payables exclude amounts provided for annual leave, which is outside
the scope of AASB 139.
(ii)
Debt is recorded at the current carrying value which is considered equivalent to fair value.
NOTE 21: AUDITOR’S REMUNERATION
Remuneration of the auditor for:
– Audit fees
– Half year review
–
Taxation compliance
– Other advisory services
2016
$
2015
$
60,000
45,000
23,000
22,000
3,000
450
7,500
2,340
86,450
76,840
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2016 Annual Report
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ended 30 June 2016
Notes to the Financial Statements
For the year ended 30 June 2016
NOTES TO THE FINANCIAL STATEMENTS For the year
Directors’ Declarations
For the year ended 30 June 2016
In accordance with a resolution of the directors of Indoor Skydive Australia Group Limited, the Directors of the
Company declare that:
1.
The financial statements and notes, as set out on pages 26 to 70, are in accordance with the Corporations Act
2001 and:
and
a.
comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the
financial statements, constitutes compliance with International Financial Reporting Standards (IFRS);
b.
give a true and fair view of the financial position as at 30 June 2016 and of the performance for the
year ended on that date of the consolidated group;
2.
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
3.
The Directors have been given the declarations required by s 295A of the Corporations Act 2001.
Ken Gillespie
Chairman
23 August 2016
Sydney
Wayne Jones
Director & Chief Executive Officer
NOTE 24: CONTINGENT LIABILITIES
Other than as disclosed in Note 1(r)(vi), the Group does not have any contingent liabilities at the reporting date.
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2016 Annual Report |
Notes to the Financial Statements
For the year ended 30 June 2016
NOTE 24: CONTINGENT LIABILITIES
Other than as disclosed in Note 1(r)(vi), the Group does not have any contingent liabilities at the reporting date.
DIRECTORS’ DECLARATION For the year
Directors’ Declarations
For the year ended 30 June 2016
ended 30 June 2016
In accordance with a resolution of the directors of Indoor Skydive Australia Group Limited, the Directors of the
Company declare that:
1.
The financial statements and notes, as set out on pages 26 to 70, are in accordance with the Corporations Act
2001 and:
a.
b.
comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the
financial statements, constitutes compliance with International Financial Reporting Standards (IFRS);
and
give a true and fair view of the financial position as at 30 June 2016 and of the performance for the
year ended on that date of the consolidated group;
2.
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
3.
The Directors have been given the declarations required by s 295A of the Corporations Act 2001.
Ken Gillespie
Chairman
23 August 2016
Sydney
Wayne Jones
Director & Chief Executive Officer
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2016 Annual Report
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INDEPENDENT AUDITORS REPORT
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
INDOOR SKYDIVE AUSTRALIA GROUP LIMITED
Report on the Financial Report
We have audited the accompanying financial report of Indoor Skydive Australia Group Limited, which comprises
the consolidated statement of financial position as at 30 June 2016, and the consolidated statement of profit or
loss and other comprehensive income, consolidated statement of changes in equity and consolidated statement
of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other
explanatory information, and the directors' declaration of the consolidated entity comprising the company and
the entities it controlled at the year’s end or from time to time during the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation of the financial report that gives a true and fair
view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal
control as the directors determine is necessary to enable the preparation of the financial report that is free from
material misstatement, whether due to fraud or error. In Note 1, the directors also state, in accordance with
Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements comply with
International Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in
accordance with Australian Auditing Standards. These Auditing Standards require that we comply with relevant
ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable
assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial report. The procedures selected depend on the auditor's judgement, including the assessment of the
risks of material misstatement of the financial report, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of
the financial report 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 entity's internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates
made by the directors, as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinions.
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2016 Annual Report |
Independence
In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001.
We confirm that the independence declaration required by the Corporations Act 2001, which has been given to
the directors of Indoor Skydive Australia Group Limited, would be in the same terms if given to the directors as
at the time of this auditor's report.
Opinion
In our opinion:
(a)
the financial report of Indoor Skydive Australia Group Limited and Controlled Entities is in accordance
with the Corporations Act 2001, including:
(i)
giving a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of
its performance for the year ended on that date; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001; and
(b)
the financial report also complies with International Financial Reporting Standards as disclosed in Note 1.
Report on the Remuneration Report
We have audited the Remuneration Report included in pages 13 to 24 of the directors’ report for the year ended
30 June 2016. The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to
express an opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Opinion
In our opinion the Remuneration Report of Indoor Skydive Australia Group Limited for the year ended 30 June
2016 complies with section 300A of the Corporations Act 2001.
RSM AUSTRALIA PARTNERS
G N SHERWOOD
Partner
Sydney, NSW
Dated: 23 August 2016
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| 2016 Annual Report
Additional Information
ADDITIONAL INFORMATION
The following information is current as at 8 August 2016:
1.
Shareholder Information
Distribution of Shareholders
Category (size of holding):
Number
Ordinary Shares
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
36
110
90
260
55
551
20,556
291,543
750,991
8,383,284
110,746,630
120,193,004
The number of shareholdings held in less than marketable parcels is 49.
The names of the substantial shareholders listed in the holding company’s register are:
Shareholder:
Number of Shares
% of Issued Capital
Birkdale Holdings (QLD) Pty Ltd
Excalib-Air Pty Ltd
Challenger Limited
Acorn Capital Limited
17,000,001
16,060,000
15,213,222
10,000,000
Paradice Investment Management Pty Ltd
7,462,929
Contango Asset Management Limited
5,999,273
14.48
13.68
12.66
9.04
6.25
5.02
Voting Rights
ISA Group has ordinary shares on issue. The voting rights attached to each ordinary share is one vote
per share when a poll is called, otherwise each member present at a meeting or by proxy has one vote
on a show of hands.
ISA Group has performance rights on issue which are not listed on the ASX. Details of the performance
rights are set out in the Remuneration Report. Performance rights do not give a holder the right to
vote at any meeting of ISA Group.
Additional Information
20 Largest Shareholders – Ordinary Shares
Name
% Held of Issued
Ordinary Capital
Number of
Ordinary
Fully Paid
Shares Held
18,455,354
17,000,001
16,060,000
4,975,000
3,989,812
2,916,667
2,881,610
2,500,000
2,129,137
1,567,423
1,000,000
757,000
415,000
J P MORGAN NOMINEES AUSTRALIA LIMITED
14,943,017
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
7,097,280
NATIONAL NOMINEES LIMITED
BIRKDALE HOLDINGS (QLD) PTY LTD
EXCALIB-AIR PTY LTD
UBS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
QUAD INVESTMENTS PTY LTD
BNP PARIBAS NOMS PTY LTD
LYNDCOTE HOLDINGS PTY LTD 2,521,667
IFLY AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
PROJECT GRAVITY PTY LTD
1,967,423
AUSTRALIAN INDOOR SKYDIVING PTY LTD
P/L S/F A/C>
R & K HOOD INVESTMENTS PTY LIMITED 961,803
JACK SUPER PTY LTD
850,000
NULIS NOMINEES (AUSTRALIA) LIMITED
MR BRETT AARAN SHERIDAN
SHAUNN RICHARD SEGON & TONIA ALYSSA SEGON
412,500
15.355%
14.144%
13.362%
12.433%
5.905%
4.139%
3.320%
2.427%
2.397%
2.098%
2.080%
1.771%
1.637%
1.304%
0.832%
0.800%
0.707%
0.630%
0.345%
0.343%
103,400,694
86.029%
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2016 Annual Report |
Additional Information
Additional Information
20 Largest Shareholders – Ordinary Shares
Name
NATIONAL NOMINEES LIMITED
BIRKDALE HOLDINGS (QLD) PTY LTD
EXCALIB-AIR PTY LTD
Number of
Ordinary
Fully Paid
Shares Held
18,455,354
17,000,001
16,060,000
J P MORGAN NOMINEES AUSTRALIA LIMITED
14,943,017
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
7,097,280
UBS NOMINEES PTY LTD
CITICORP NOMINEES PTY LIMITED
QUAD INVESTMENTS PTY LTD
BNP PARIBAS NOMS PTY LTD
4,975,000
3,989,812
2,916,667
2,881,610
LYNDCOTE HOLDINGS PTY LTD 2,521,667
IFLY AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
2,500,000
2,129,137
PROJECT GRAVITY PTY LTD
1,967,423
The following information is current as at 8 August 2016:
1.
Shareholder Information
Distribution of Shareholders
Category (size of holding):
Number
Ordinary Shares
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
36
110
90
260
55
551
20,556
291,543
750,991
8,383,284
110,746,630
120,193,004
The number of shareholdings held in less than marketable parcels is 49.
The names of the substantial shareholders listed in the holding company’s register are:
Shareholder:
Number of Shares
% of Issued Capital
Birkdale Holdings (QLD) Pty Ltd
Excalib-Air Pty Ltd
Challenger Limited
Acorn Capital Limited
17,000,001
16,060,000
15,213,222
10,000,000
Paradice Investment Management Pty Ltd
7,462,929
Contango Asset Management Limited
5,999,273
14.48
13.68
12.66
9.04
6.25
5.02
Voting Rights
on a show of hands.
ISA Group has ordinary shares on issue. The voting rights attached to each ordinary share is one vote
per share when a poll is called, otherwise each member present at a meeting or by proxy has one vote
ISA Group has performance rights on issue which are not listed on the ASX. Details of the performance
rights are set out in the Remuneration Report. Performance rights do not give a holder the right to
vote at any meeting of ISA Group.
SABRE ONE INVESTMENTS PTY LTD 961,803
JACK SUPER PTY LTD
850,000
NULIS NOMINEES (AUSTRALIA) LIMITED
MR BRETT AARAN SHERIDAN
757,000
415,000
SHAUNN RICHARD SEGON & TONIA ALYSSA SEGON
412,500
AUSTRALIAN INDOOR SKYDIVING PTY LTD
R & K HOOD INVESTMENTS PTY LIMITED
1,000,000
1,567,423
% Held of Issued
Ordinary Capital
15.355%
14.144%
13.362%
12.433%
5.905%
4.139%
3.320%
2.427%
2.397%
2.098%
2.080%
1.771%
1.637%
1.304%
0.832%
0.800%
0.707%
0.630%
0.345%
0.343%
103,400,694
86.029%
Indoor Skydive Australia Group Limited
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| 2016 Annual Report
Additional Information
ADDITIONAL INFORMATION
Corporate Directory
2.
3.
4.
5.
The name of the company secretary is Fiona Yiend.
The address of the principal registered office in Australia is Level 2, 201 Miller Street North Sydney
NSW 2060. Telephone 02 9325 5900.
Directors
Registers of securities are held at Grosvenor Place, Level 12, 225 George Street, Sydney NSW 2000.
Stock Exchange Listing
Quotation has been granted for all 120,193,004 ordinary shares of the company on all Member
Exchanges of the Australian Securities Exchange Limited.
6.
Unquoted Securities
The Company has on issue 1,061,784 Performance Rights under the Indoor Skydive Australia Group
Limited Performance Rights Plan.
There are no options over unissued shares.
Ken GILLESPIE
Wayne JONES
Danny HOGAN
Stephen BAXTER
David MURRAY
Kirsten THOMSON
Level 2
201 Miller Street
North Sydney NSW 2060
Level 2
201 Miller Street
North Sydney NSW 2060
Boardroom Pty Limited
Level 12
225 George Street
Sydney NSW 2000
RSM Australia Partners
Level 12
60 Castlereagh St
Sydney NSW 2000
Company Secretary
Fiona YIEND
Registered Office
Indoor Skydive Australia Group Ltd
Principle place of business
Indoor Skydive Australia Group Ltd
Share register
Auditor
Bankers
Westpac Banking Corporation
Stock exchange listing code:
IDZ
Website
www.indoorskydive.com.au
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2016 Annual Report |
Additional Information
The name of the company secretary is Fiona Yiend.
2.
3.
4.
5.
Stock Exchange Listing
6.
Unquoted Securities
Limited Performance Rights Plan.
There are no options over unissued shares.
Corporate Directory
CORPORATE DIRECTORY
The address of the principal registered office in Australia is Level 2, 201 Miller Street North Sydney
Directors
NSW 2060. Telephone 02 9325 5900.
Registers of securities are held at Grosvenor Place, Level 12, 225 George Street, Sydney NSW 2000.
Quotation has been granted for all 120,193,004 ordinary shares of the company on all Member
Exchanges of the Australian Securities Exchange Limited.
Ken GILLESPIE
Wayne JONES
Danny HOGAN
Stephen BAXTER
David MURRAY
Kirsten THOMSON
The Company has on issue 1,061,784 Performance Rights under the Indoor Skydive Australia Group
Company Secretary
Fiona YIEND
Registered Office
Principle place of business
Share register
Auditor
Indoor Skydive Australia Group Ltd
Level 2
201 Miller Street
North Sydney NSW 2060
Indoor Skydive Australia Group Ltd
Level 2
201 Miller Street
North Sydney NSW 2060
Boardroom Pty Limited
Level 12
225 George Street
Sydney NSW 2000
RSM Australia Partners
Level 12
60 Castlereagh St
Sydney NSW 2000
Bankers
Westpac Banking Corporation
Stock exchange listing code:
IDZ
Website
www.indoorskydive.com.au
Indoor Skydive Australia Group Limited – 2016 Annual Report
www.indoorskydiveaustralia.com.au
77
Indoor Skydive Australia Group Limited
2016 Annual Report
77
78
| 2016 Annual Report
NOTES
78
2016 Annual Report | Indoor Skydive Australia Group Ltd
Level 2, 201 Miller Street
North Sydney NSW 2060
www.indoorskydiveaustralia.com.au