ASX ANNOUNCEMENT
Sydney, Wednesday 26 August 2020
Appendix 4E (Preliminary Final Report) and Annual Report
The Appendix 4E (Preliminary Final Report) and Annual Report of Integrated Payment Technologies
Limited (ASX: IP1) for the financial year ended 30 June 2020 are attached.
These documents have been authorised by the Board for release to ASX.
Contact Details:
Don Sharp
Executive Chairman
E: Don.Sharp@inpaytech.com.au
M: 0419 632 315
Integrated Payment Technologies Limited ACN 611 202 414
Suite 1, Level 5, 28 Margaret Street, Sydney, NSW, 2000
inpaytech.com.au
Integrated Payment Technologies Limited
Appendix 4E
Preliminary final report
1. Company details
Name of entity:
ABN:
Reporting period:
Previous period:
Integrated Payment Technologies Limited
50 611 202 414
For the year ended 30 June 2020
For the year ended 30 June 2019
2. Results for announcement to the market
The Group has adopted Accounting Standards AASB 16 'Leases' for the year ended 30 June 2020 using the modified
retrospective approach and as such the comparatives have not been restated.
$
Revenues from ordinary activities
down
16.8% to
1,494,154
Loss from ordinary activities after tax attributable to the owners of
Integrated Payment Technologies Limited
down
71.8% to
(3,666,012)
Loss for the year attributable to the owners of Integrated Payment
Technologies Limited
down
71.8% to
(3,666,012)
Dividends
There were no dividends paid, recommended or declared during the current financial period.
Comments
The loss for the Group after providing for income tax amounted to $3,666,012 (30 June 2019: $13,022,078).
The impact of Coronavirus (COVID-19) pandemic up to 30 June 2020 has been neutral for the Group except for the
significant and progressive lowering of interest rates over the financial year which has resulted in a materially adverse
impact on ClickSuper float income.
COVID-19 restrictions have continued to impact the marketing of PayVu as accountants and bookkeepers have hesitated
in introducing new services to their clients during lockdown and business restrictions. The Company is positioned to renew
our marketing campaign of PayVu when economic conditions improve.
Further commentary on the Group’s operating performance and results from operations are set out in the attached Annual
Report.
3. Net tangible assets
Net tangible assets per ordinary security
4. Control gained over entities
Not applicable.
5. Loss of control over entities
Not applicable.
Reporting
period
Cents
Previous
period
Cents
(0.12)
0.35
Integrated Payment Technologies Limited
Appendix 4E
Preliminary final report
6. Dividends
Current period
There were no dividends paid, recommended or declared during the current financial period.
Previous period
There were no dividends paid, recommended or declared during the previous financial period.
7. Dividend reinvestment plans
Not applicable.
8. Details of associates and joint venture entities
Not applicable.
9. Foreign entities
Details of origin of accounting standards used in compiling the report:
Not applicable.
10. Audit qualification or review
Details of audit/review dispute or qualification (if any):
The financial statements have been audited and an unqualified opinion has been issued and is attached as part of the
Annual Report.
11. Attachments
Details of attachments (if any):
The Annual Report of Integrated Payment Technologies Limited for the year ended 30 June 2020 is attached.
12. Signed
As authorised by the Board of Directors
Signed ___________________________
Date: 26 August 2020
Don Sharp
Executive Chairman
Sydney
ACN. 611 202 414
ASX Code IP1(one)
Annual Report for the year ended 30 June 2020
Integrated Payment Technologies Limited
Contents
30 June 2020
Chairman and CEO letter
Directors' report
Auditor's independence declaration
Statement of profit or loss and other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors' declaration
Independent auditor's report to the members of Integrated Payment Technologies Limited
Shareholder information
Corporate directory
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5
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1
Integrated Payment Technologies Limited
Chairman and CEO letter
30 June 2020
Dear Shareholder,
On behalf of the Directors of Integrated Payment Technologies Limited (the Company, InPayTech or IP1) we are pleased to
announce the results for the Company for the financial year ended 30 June 2020. The NPBT for the financial year ended 30
June 2020 was a loss of $3,671,857 (2019 loss $12,969,059). The EBITDA after including the non-cash cost of Depreciation
(2019 Depreciation and Impairment) loss and non-cash share option costs was a loss of $1,748,755 (2018 loss $1,168,473).
The impact of the coronavirus (COVID-19) pandemic up to 30 June 2020 has been neutral for the InPayTech group except
for the significant and progressive lowering of interest rates over the financial year which has resulted in a materially
adverse impact on ClickSuper float income and marketing of PayVu. The Company is planning to partly meet this loss of
income by increasing ClickSuper transaction fee income, commencing next quarter. This will be the first time fees have
been increased since the business commenced.
Entitlement Offer and Placement
The Company had a successful Share Placement prior to 30 June 2020 and a follow-on Entitlement Offer to existing
shareholders with funds received post June. The funds raised from the Entitlement Offer, together with the Placement,
were $3,471,302. The Company has now repaid the borrowings of $750,000 and is debt free.
Current Services
The business uses our patented process of linking data to payments, with the payment services (ClickSuper, Payment
Adviser and PayVu) sharing and re-using software components to deliver services to their respective markets.
ClickSuper provides a complete turnkey solution to SuperStream and Single Touch Payroll compliance for
superannuation funds, payroll, accounting and enterprise resource planning software. The Company is looking to
reposition ClickSuper in an attempt to engage a wider market, augment current functionality and provide
additional services to existing clients and their end customers.
Payment Adviser provides a service which is used for non-payroll related payments e.g. invoice payments. The
service is positioned to benefit from growth in the small business loans market with an existing client. Further the
Payment Adviser service may be used in the future to repurpose existing software and functionality for the peer to
peer lending market.
PayVu provides bookkeepers, accountants, offshore support services and other professional advisory providers
with the ability to provide a complete business payment solution that is scalable while simultaneously reducing the
risk and rework traditionally associated with payment bureau services. This transformative solution enables
bookkeepers and other professional advisory providers to remove low value contact between stakeholders from
the payment process and enables business owners to easily approve and reject recommended payments via their
smart phone. Over the last 12 months PayVu functionality has been enhanced and simplified with the benefit of
feedback from its early adopters.
Significant changes in the state of affairs.
The Company’s growth strategy is focused on evolving from its base of payment and compliance capabilities to developing
an engagement platform. The use of up to date and complete employment data from our integrated payroll network
facilitates targeted and relevant engagement. Additionally, the use of periodic payments, including contribution and salary
payments, facilitates regular engagement with employees and members. It is expected that InPayTech will provide new
and existing customers (including employers, payroll vendors, superannuation funds and other suppliers) with a digital
engagement solution powered by payroll data and periodic payments for specific and regular advice, education and
benefits.
2
Integrated Payment Technologies Limited
Chairman and CEO letter
30 June 2020
PayVu
During the financial year PayVu completed its major development phase, having finalised an Accounts Payable Integration
Agreement with Xero. The integration enhanced PayVu’s ability to deliver a complete and scalable accounts payable
solution to PayVu customers who are Xero bookkeepers and accountants. Furthermore, completing the partner API
integration with Xero increased the speed and reliability of PayVu for new and existing PayVu customers. With major
development complete, InPayTech was able to scale back development resources and costs.
COVID-19 restrictions have continued to impact the marketing of PayVu as accountants and bookkeepers have hesitated in
introducing new services to their clients during lockdown and business restrictions. The Company is positioned to renew
our marketing campaign of PayVu when economic conditions improve.
Proposed Acquisition of TipsGo Pty Ltd
The Company executed a deed in August 2020, to acquire 100% of the shares in TipsGo Pty Ltd (TipsGo), owner of an Open
Banking and Marketplace Platform. As part of the Company’s due diligence, an extensive investigation and confirmation of
the Intellectual Property (IP) rights were undertaken by InPayTech’s IP attorney.
Although TipsGo is currently a non-operating business, the InPayTech directors believe the IP held by TipsGo is of value to
InPayTech’s growth strategy. The acquisition terms provide for the issue of 33,000,000 consideration shares in InPayTech,
subject to 12 months voluntary escrow and the approval of InPayTech’s shareholders at our planned general meeting in
October 2020, as well as the payment of $30,000 (plus GST) (refer page 6 for further details of acquisition terms).
The director of TipsGo, who is a co-inventor of InPayTech’s payment patents, has agreed to provide up to 10 hours of
consulting time per month until 31 December 2021, at no cost until InPayTech is cash flow positive, including periodically
reviewing the technical architecture of InPayTech and the integration of the TipsGo platform into the ClickSuper service.
The integration of TipsGo’s 140+ Application Programming Interfaces (APIs), covering topics such as payments, cash flow
analysis, financial calculators, budgeting, product comparators and more, powered with rich payroll data from ClickSuper’s
growing integrated payroll network, is expected to reposition ClickSuper as the proposed digital engagement solution,
ClickVu. Initially it is proposed that the ClickVu platform will cater for superannuation funds, payroll vendors and
employers. However, InPayTech is already in initial discussions with other service providers who may be able to provide
additional functionality to the ClickVu platform on a collaborative and mutually beneficial basis.
The Company is currently working with some existing customers, and third-party vendors, on a ClickVu proof of concept
which is progressing well. The proof of concept aims to demonstrate the utility and simplicity of the platform and to
position ClickSuper beyond a compliance payment solution. On the assumption that completion of the TipsGo acquisition
takes place as planned, ClickSuper should therefore benefit during the current financial year.
Additional Patent
The delegate of the Commissioner of Patents at IP Australia has issued a decision in favour of granting our patent
application.
The Australian patent is expected to be granted by the end of the 2020 calendar year, or early in 2021.
If granted as expected, this will be the eighth patent for InPayTech across the globe. Other patents in the western world
include the United States, South Africa and New Zealand. InPayTech has also patented its payments process in Asia
including China, Japan, Hong Kong and Singapore. We also have a patent pending in Canada.
If granted as expected, the Australian patent will be a significant milestone for InPayTech. The Company believes its
unique technology makes payment processing more efficient while simultaneously making it easier to meet increasing
compliance obligations.
3
Integrated Payment Technologies Limited
Chairman and CEO letter
30 June 2020
We thank our existing shareholders for their continuing support and welcome new shareholders to InPayTech.
Yours sincerely,
Don Sharp
Executive Director
26 August 2020
Sydney
Dean Martin
Chief Executive Officer
4
Integrated Payment Technologies Limited
Directors' report
30 June 2020
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'Group') consisting of Integrated Payment Technologies Limited (referred to hereafter as the 'Company' or 'parent
entity') and the entities it controlled at the end of, or during, the year ended 30 June 2020.
Directors
The following persons were directors of Integrated Payment Technologies Limited during the whole of the financial year
and up to the date of this report, unless otherwise stated:
Don Sharp - Executive Chairman
Paul Collins - Non-Executive Director
Sandra Barns - Non-Executive Director (appointed 13 January 2020)
Robin Beauchamp - Chief Technology Officer (ceased 10 July 2020)
Principal activities
During the financial year the principal activities of the Group consisted of operating the following businesses:
●
●
●
●
ClickSuper which provides clearing house services for large employers with 20 or more employees and for SMEs with
less than 20 employees.
Payment Adviser which facilitates payments and communication of data concerning the payment between the
payer/provider and payee/recipient using the Patents pending or granted to Jagwood.
PayVu incorporates Clicksuper and Payment Adviser functionality which is integrated with accounting cloud based
software to give a seamless way to make payments and record the transactions in an accounting system.
In Australia the delegate of the Commissioner of Patents at IP Australia has issued a decision in favour of granting our
patent application. The Australian patent is expected to be granted by the end of the year, or early in 2021. If granted
as expected, this will be the eighth patent for InPayTech across the globe. Other patents in the western world include
the United States, South Africa and New Zealand. InPayTech has also patented its payments process in Asia
including China, Japan, Hong Kong and Singapore. The Group also has a patent pending in Canada.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Review of operations
The loss for the Group after providing for income tax amounted to $3,666,012 (30 June 2019: $13,022,078).
The impact of Coronavirus (COVID-19) pandemic up to 30 June 2020 has been neutral for the Group except for the
significant and progressive lowering of interest rates over the financial year which has resulted in a materially adverse
impact on ClickSuper float income.
COVID-19 restrictions have continued to impact the marketing of PayVu as accountants and bookkeepers have hesitated
in introducing new services to their clients during lockdown and business restrictions. The Company is positioned to renew
our marketing campaign of PayVu when economic conditions improve.
Refer to ‘Chairman and CEO letter’ for details on the operations throughout the year.
Significant changes in the state of affairs
On 22 June 2020, the Company issued 77,000,000 ordinary shares as part of the 1 for 2 non-renounceable Entitlement
Offer raising a total of $1,155,000.
There were no other significant changes in the state of affairs of the Group during the financial year.
5
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Matters subsequent to the end of the financial year
Acquisition of BizIntergration
The proposed acquisition of BizIntegration was announced to the ASX on 16 June 2020. As part of the Company’s due
diligence, an extensive investigation and confirmation of the Intellectual Property (IP) rights of Biz Integration Pty Ltd was
undertaken by InPayTech’s IP attorney. It was subsequently agreed by all parties for InPayTech to acquire TipsGo Pty Ltd
to gain full IP rights to the platform. Although TipsGo is currently a non-operating business, the InPayTech directors believe
the IP held by TipsGo is of value to InPayTech’s growth strategy.
The acquisition terms provide for:
●
●
●
●
●
a payment of $30,000 (plus GST) to be made to Biz Integration Pty Ltd for work undertaken in supplying, loading and
testing the TipsGo platform on InPayTech’s infrastructure on completion of the acquisition;
the issue of 33,000,000 fully paid ordinary shares by InPayTech to the TipsGo shareholder as consideration shares
on completion of the acquisition;
the issue of 3,000,000 fully paid ordinary shares by InPayTech to a third party associated with TipsGo for the
assignment of their IP rights to TipsGo as consideration shares on completion of the acquisition;
the issue of such shares by InPayTech is conditional upon approval of InPayTech shareholders (with a general
meeting planned for October 2020); and
shares issued by InPayTech will be subject to a 12 month voluntary escrow agreement. The acquisition terms provide
for the proposed completion of the acquisition following shareholder approval by InPayTech shareholders.
The director of TipsGo, who is a co-inventor of InPayTech’s payment patents, has agreed to provide up to 10 hours of
consulting time per month until 31 December 2021, at no cost until InPayTech is cash flow positive, including periodically
reviewing the technical architecture of InPayTech and the integration of the TipsGo platform into the ClickSuper service.
The integration of TipsGo’s 140+ Application Programming Interfaces (APIs), covering topics such as payments, cash flow
analysis, financial calculators, budgeting, product comparators and more, powered with rich payroll data from ClickSuper’s
growing integrated payroll network, is expected to reposition ClickSuper as the proposed digital engagement solution,
ClickVu.
Australian Patent
The delegate of the Commissioner of Patents at IP Australia has issued a decision in favour of granting our patent
application. The Australian patent is expected to be granted by the end of the year, or early in 2021.
If granted as expected, this will be the eighth patent for InPayTech across the globe. Other patents in the western world
include the United States, South Africa and New Zealand. InPayTech has also patented its payments process in Asia
including China, Japan, Hong Kong and Singapore. The Group also has a patent pending in Canada.
If granted as expected, the Australian patent will be a significant milestone for InPayTech. We believe our unique and novel
technology makes payment processing more efficient while simultaneously making it easier to meet increasing compliance
obligations.
Capital raising
On 8 July 2020, the Company issued 125,546,123 ordinary shares as part of the 1 for 2 non-renounceable Entitlement
Offer raising a total of $1,883,192.
On 15 July 2020, the Company issued the remaining shortfall shares under the 1 for 2 non-renounceable Entitlement Offer
raising additional $433,110.
Shareholder loans
On 15 July 2020, the Group paid all the shareholder loans totalling $750,000 and is now debt free.
COVID-19
The impact of COVID-19 pandemic is ongoing and it is not practicable to estimate the potential impact, positive or
negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the
Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel
restrictions and any economic stimulus that may be provided.
No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect
the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
6
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Likely developments and expected results of operations
Refer to the Chairman and Chief Executive Officer's letter as well as the Business Overview sections for details.
Environmental regulation
The Group is not subject to any significant environmental regulation under Australian Commonwealth or State law.
Information on directors
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Donald ('Don') Sharp
Executive Chairman
B.Bus, CPA, FAICD
Don is a qualified accountant and a highly experienced, innovative and respected
business builder and leader in the financial services sector. He co-founded Bridges
Financial Services Pty Ltd an industry leader in financial services well known for
establishing one of the first platform solutions for portfolio management in Australia,
The Portfolio Service. Don is Former Chairman of Investors Mutual, Global Value
Investors, and Premium Investors Limited (ASX: PRV) and a former Director of
Countplus Limited (ASX: CUP) and Treasury Group Ltd (ASX: TRG).
Non-Executive Director of Xplore Wealth Limited formerly known as Managed
Accounts Holdings Limited (ASX: XPL).
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in options:
Name:
Title:
Qualifications:
Experience and expertise:
Member of Nomination and Remuneration Committee and Audit, Risk and
Compliance Committee
101,717,177 ordinary shares indirectly held
None
Paul Collins
Non-Executive Director
B.Sc., GAICD
Paul has extensive experience with publicly listed technology companies. Over the
last 20 years, Paul has been extensively and directly involved in the start-up and
subsequent ASX listing of 2 successful FinTech companies. A co-founder of IWL in
1997, he was an Executive Director of this company from its inception, through its
listing in 1999 (ASX: IWL) before leaving in 2004. Later in 2004, Mr Collins was a co-
founder and Executive Director of Xplore Wealth Limited formerly known as Managed
Accounts Holdings Ltd which listed on the ASX in 2014 (ASX: MGP). He chaired the
Audit, Risk and Compliance Committees of MGP from 2009 until 2016
ReadCloud Limited (ASX: RCL
Other current directorships:
Former directorships (last 3 years): None
Interests in shares:
42,083,372 ordinary shares held
Name:
Title:
Qualifications:
Experience and expertise:
Sandra Barns
Non-Executive Director (appointed 13 January 2020)
B.A.Sc., B. Math, GAICD
Sandra is an experienced executive manager and has held several executive roles as
Chief Technology Officer ('CTO'), and Chief Information Security Officer ('CISO') in
the financial services, superannuation, and financial technology sector. She brings
significant exposure working with Government, regulatory bodies and Boards.
Executive Company Director for VicSuper
Other current directorships:
Former directorships (last 3 years): Former Non-executive director of Health Ability, Nilumbik Health and IWFCI.
Special responsibilities:
Interests in shares:
Interests in options:
Member of Audit, Risk and Compliance Committee and Nomination Committee
None
None
7
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Name:
Title:
Experience and expertise:
Robin Beauchamp
Chief Technology Officer (ceased 10 July 2020)
Robin is a financial technology specialist with over 30 years’ experience in the
Australian financial services industry. Robin held the role of banking software
development manager for Misys Australia and consulted to banks in Australia and the
United Kingdom. In 1993 Robin founded the financial software company Investsoft
that developed and marketed unitised portfolio management and financial planner
In 2007 as Director of Technology –
commission management software.
Development Robin co-founded Payment Adviser Group and in 2012 was appointed
to the role of Chief Executive Officer. In 2013 Robin led the acquisition of ClickSuper
along with the integration into Payment Adviser and a new banking platform.
Other current directorships:
None
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Former member of the Audit, Risk and Compliance Committee
not applicable as no longer a director
'Other current directorships' quoted above are current directorships for listed entities only and excludes directorships of all
other types of entities, unless otherwise stated.
'Former directorships (last 3 years)' quoted above are directorships held in the last 3 years for listed entities and their
subsidiaries and excludes directorships of all other types of entities, unless otherwise stated.
Company secretary
Jillian McGregor (BCom, LLB, Grad Dip GIA) serves as Company Secretary of the Company. Jillian has worked as a
corporate lawyer for over 20 years and has a deep knowledge and understanding of the Corporations Act 2001 and the
ASX listing rules.
Meetings of directors
The number of meetings of the Company's Board of Directors ('the Board') and of each Board committee held during the
year ended 30 June 2020, and the number of meetings attended by each director were:
Full Board
Attended
Held
Nomination and
Remuneration Committee
Attended
Held
Audit, Risk and Compliance
Committee
Attended
Held
Donald Sharp
Paul Collins
Sandra Barns
Robin Beauchamp
11
11
7
11
11
11
7
11
1
1
1
-
1
1
1
-
8
8
4
8
8
8
4
8
Held: represents the number of meetings held during the time the director held office and was a member of the relevant
committee.
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the Group, in accordance
with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all directors.
The remuneration report is set out under the following main headings:
●
●
●
●
●
Principles used to determine the nature and amount of remuneration
Details of remuneration
Service agreements
Share-based compensation
Additional disclosures relating to key management personnel
8
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Principles used to determine the nature and amount of remuneration
The objective of the Group's executive reward framework is to ensure reward for performance is competitive and
appropriate for the results delivered. The framework aligns executive reward with the achievement of strategic objectives
and the creation of value for shareholders, and it is considered to conform to the market best practice for the delivery of
reward. The Board of Directors ('the Board') ensures that executive reward satisfies the following key criteria for good
reward governance practices:
●
●
●
●
competitiveness and reasonableness;
acceptability to shareholders;
performance linkage / alignment of executive compensation; and
transparency.
The Nomination and Remuneration Committee is responsible for determining and reviewing remuneration arrangements
for its directors and executives. The performance of the Group depends on the quality of its directors and executives. The
remuneration philosophy is to attract, motivate and retain high performance and high quality personnel.
The Nomination and Remuneration Committee has structured an executive remuneration framework that is market
competitive and complementary to the reward strategy of the Group.
The reward framework is designed to align executive reward to shareholders' interests. The Board have considered that it
should seek to enhance shareholders' interests by:
●
●
having economic profit as a core component of plan design;
focusing on sustained growth in shareholder wealth, consisting of dividends and growth in share price, and delivering
constant or increasing return on assets as well as focusing the executive on key non-financial drivers of value; and
attracting and retaining high calibre executives.
●
Additionally, the reward framework should seek to enhance executives' interests by:
●
●
●
rewarding capability and experience;
reflecting competitive reward for contribution to growth in shareholder wealth; and
providing a clear structure for earning rewards.
In accordance with best practice corporate governance, the structure of non-executive director and executive director
remuneration is separate.
Non-executive directors remuneration
Fees and payments to non-executive directors reflect the demands and responsibilities of their role. Non-executive
directors' fees and payments are reviewed annually by the Nomination and Remuneration Committee. The Nomination and
Remuneration Committee may, from time to time, receive advice from independent remuneration consultants to ensure
non-executive directors' fees and payments are appropriate and in line with the market. The chairman's fees are
determined independently to the fees of other non-executive directors based on comparative roles in the external market.
The chairman is not present at any discussions relating to the determination of his own remuneration. Non-executive
directors do not receive share options or other incentives.
The annual non-executive directors’ fees are currently $60,000 plus superannuation guarantee contribution for each non-
executive director. However, other members of Board Committees are not entitled to receive any additional remuneration
for their role as Committee member.
Under the Constitution, the Board may decide the remuneration of each director is entitled to for his services in any
capacity. However, the total amount paid to all non-executive directors must not exceed in aggregate in any financial year,
the amount fixed by the Company in a general meeting. In accordance with the Prospectus issued on 23 September 2016,
the amount has been fixed at $180,000 per annum.
Executive remuneration
The Group aims to reward executives based on their position and responsibility, with a level and mix of remuneration which
has both fixed and variable components.
The executive remuneration and reward framework has three components:
●
●
●
base pay and non-monetary benefits;
share-based payments; and
other remuneration such as superannuation and long service leave.
9
Integrated Payment Technologies Limited
Directors' report
30 June 2020
The combination of these comprises the executive's total remuneration.
Fixed remuneration, consisting of base salary, superannuation and non-monetary benefits, are reviewed annually by the
Nomination and Remuneration Committee based on individual and business unit performance, the overall performance of
the Group and comparable market remunerations.
Executives may receive their fixed remuneration in the form of cash or other fringe benefits (for example motor vehicle
benefits) where it does not create any additional costs to the Group and provides additional value to the executive.
There are no short-term incentives ('STI') such as bonuses currently in place.
The long-term incentives ('LTI') include long service leave and share-based payments. Senior executives participate in the
Employee Share Option Plan ('ESOP').
Employee Share Option Plan
The Board approved the Integrated Payment Technologies Limited Employee Share Option Plan ('ESOP' or 'Plan') on 18
August 2016. The Plan is governed by the Plan rules ('Plan Rules'), a summary of which is set out below.
Persons eligible to participate in the Plan are full-time or part-time employees (including executive directors), non-executive
directors and contractors and casual employees of the Group who satisfy various conditions set out in the Plan ('Eligible
Persons').
The Plan was established to enable the Group to retain and attract skilled and experienced employees, contractors and
directors and provide them with the motivation to make the Group more successful. The Plan is designed to support
interdependence between the Company and Eligible Persons for their long-term mutual benefit.
Under the Plan, unless otherwise determined by the Board, no payment is required for the grant of options under the Plan.
An offer by the Board shall specify the terms and conditions of the grant at its discretion. An Eligible Person may renounce
an offer under the Plan in favour of a permitted nominee. Options granted under the Plan may not otherwise be transferred
or encumbered by a Participant, unless the Board determines otherwise.
The Board at its sole discretion may invite any Eligible Person selected by it ('Participant') to complete an application
relating to a specified number of options allocated to that Eligible Person by the Board.
An offer by the Board shall specify the date of grant, the total number of options granted, exercise price and exercise
period for the options and any other matters the Board determines, including exercise conditions attaching to the options.
Subject to the discretion of the Board, an Eligible Person may renounce an offer under the Plan in favour of a permitted
nominee.
Options granted under the Plan are not capable of being transferred or encumbered by a Participant, unless the Board
determines otherwise.
Options do not carry any voting or dividend rights. Shares issued or transferred to Participants on exercise of an option
carry the same rights and entitlements as other issued shares, including dividend and voting rights.
The Company has no obligation to apply for quotation of the options on the ASX.
In general terms, options granted under the Plan may only be exercised if the exercise conditions have been met or are
waived by the Board, the exercise price has been paid to the Company and the options are exercised within the exercise
period relating to the option. An option granted under the Plan may not be exercised once it has lapsed.
An option may be exercised, whether or not any or all applicable exercise conditions have been met, on the occurrence of
a predominant control event, being, in general terms, where a person owns at least 90% of the issued ordinary share
capital of the Company following an offer by the person for the whole of the issued share capital of the Company.
The Company will apply to ASX for official quotation of shares issued upon exercise of options granted under the Plan so
long as the shares are quoted on the Official List of ASX at that time.
The Company may financially assist a person to pay any exercise price for an option, subject to compliance with the
provisions of the Corporations Act and the Listing Rules relating to financial assistance.
10
Integrated Payment Technologies Limited
Directors' report
30 June 2020
If a Participant ceases to be a director, an employee or a contractor of any member of the Group due to his or her
resignation, dismissal for cause or poor performance or in any other circumstances determined by the Board, vested
options held by the Participant will automatically lapse on the date of cessation, unless the Board determines otherwise. All
unvested options will lapse at the date of cessation.
If, in the opinion of the Board, a Participant has acted fraudulently or dishonestly, the Board may determine that any option
granted to that Participant should lapse, and the option will lapse accordingly.
If the Company or any member of the Group has an obligation in relation to a tax liability associated with the grant or
vesting of any option ('Tax Liability'), then the Company may sell a sufficient number of shares, post vesting or exercise of
the option, to cover the Tax Liability. A Participant may enter into alternative arrangements, if acceptable to the Board, to
settle any Tax Liability.
In the event of any reconstruction of the share capital of the Company, pro rate issue, or bonus issue of shares, the
number of options to which each Participant is entitled and/or the exercise price of those options will be adjusted
accordingly pursuant to the Plan.
The Board may terminate or suspend the operation of the Plan at any time. In passing a resolution to terminate or suspend
the operation of the Plan or to supplement or amend these rules, the Board must consider and endeavour to ensure that
there is fair and equitable treatment of all Participants. On termination of the Plan, no compensation under any contract of
employment, consultancy or directorship between an Eligible Person and a member of the Group will arise as a result.
Consolidated entity performance and link to remuneration
Remuneration for certain individuals is directly linked to the performance of the Group via the Employee Share Scheme
where the shares vest when certain share prices are reached (see note on Employee Share Scheme). There are no short
term bonuses paid but there are annual remuneration reviews at the discretion of the Nomination and Remuneration
Committee.
Use of remuneration consultants
During the financial year ended 30 June 2020, the Group did not engage any remuneration consultants to review its
remuneration policies.
Voting and comments made at the Company's 2019 Annual General Meeting ('AGM')
At the 28 November 2019 AGM, 99.4% of the votes received supported the adoption of the remuneration report for the
year ended 30 June 2019. The Company did not receive any specific feedback at the AGM regarding its remuneration
practices.
Details of remuneration
The key management personnel of the Group consisted of the directors of Integrated Payment Technologies Limited and
the following person:
●
●
Dean Martin - Chief Executive Officer (appointed 12 August 2018)
Nathan Thomas - Chief Operating Officer (resigned 8 February 2019 )
Amounts of remuneration
Details of the remuneration of key management personnel of the Group are set out in the following tables:
11
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
2020
Non-Executive Directors:
Paul Collins
Sandra Barns*
Executive Directors:
Donald Sharp
Robin Beauchamp**
Other Key Management
Personnel:
Dean Martin
Cash salary
and fees
$
Cash
bonus
$
Non-
monetary
$
Super-
annuation
$
Leave
benefits
$
Equity-
settled
$
60,000
28,260
80,505
278,161
195,996
642,922
-
-
-
-
-
-
-
-
-
-
-
-
5,700
1,260
-
-
-
25,000
-
6,849
17,352
49,312
6,088
12,937
41,065
41,065
260,501
746,236
Total
$
65,700
29,520
80,505
310,010
-
-
-
-
Remuneration disclosed is for the period from appointment to 30 June 2020.
*
** Remuneration disclosed is for the full year to the date of cessation of employment which is after 30 June 2020.
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
monetary
$
Super-
annuation
$
Leave
benefits
$
Equity-
settled
$
Total
$
41,957
18,261
75,000
273,973
156,012
123,212
688,415
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,986
1,735
-
-
-
-
45,943
19,996
7,125
26,027
-
9,132
-
266,199
82,125
575,331
14,821
15,833
69,527
7,610
-
16,742
-
-
266,199
178,443
139,045
1,040,883
2019
Non-Executive Directors:
Paul Collins*
Jonathon Wynne**
Executive Directors:
Donald Sharp
Robin Beauchamp
Other Key Management
Personnel:
Dean Martin*
Nathan Thomas**
Remuneration disclosed is for the period from appointment to 30 June 2019.
*
** Remuneration disclosed is for the year to the date of resignation.
12
Integrated Payment Technologies Limited
Directors' report
30 June 2020
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Non-Executive Directors:
Paul Collins
Sandra Barns
Jonathon Wynne
Executive Directors:
Donald Sharp
Robin Beauchamp
Other Key Management
Personnel:
Dean Martin
Nathan Thomas
Fixed remuneration
2019
2020
At risk - STI
At risk - LTI
2020
2019
2020
2019
100%
100%
-
100%
100%
100%
-
100%
100%
100%
84%
-
100%
100%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
16%
-
-
-
-
-
-
-
-
Service agreements
Remuneration and other terms of employment for key management personnel are formalised in service agreements.
Details of these agreements are as follows:
Name:
Title:
Agreement commenced:
Details:
Name:
Title:
Agreement commenced:
Details:
Name:
Title:
Agreement commenced:
Details:
Name:
Title:
Agreement commenced:
Details:
Name:
Title:
Agreement commenced:
Details:
Donald Sharp
Executive Chairman
9 March 2016
$80,505 per annum
Robin Beauchamp
Executive Director and Chief Technology Officer
5 July 2016 (ceased 10 July 2020)
$273,973 per annum plus $25,000 superannuation. Employment notice of 3 months.
Paul Collins
Non-Executive Director
19 October 2018
$60,000 per annum plus $5,700 superannuation.
Sandra Barns
Non-Executive Director
13 January 2020
$60,000 per annum plus $5,700 superannuation
Dean Martin
Chief Executive Officer
12 August 2018
$182,648 per annum plus $17,351 superannuation. Employment notice of 3 months.
Notice and termination provisions of up to three months are required where key management personnel leave, or in the
event of serious misconduct of key management personnel, the Group may sever the agreement without notice. Leave
entitlements are as per the applicable employment standards and legislation. No bonus arrangements are in place for key
management personnel at present. Senior management may participate in the Employee Share Option Plan.
Share-based compensation
Issue of shares
There were no shares issued to directors and other key management personnel as part of compensation during the year
ended 30 June 2020.
13
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Options
The terms and conditions of each grant of options over ordinary shares affecting remuneration of directors and other key
management personnel in this financial year or future reporting years are as follows:
Grant date
14 Dec 2016
31 Jul 2019
Name
Robin
Beauchamp*
Dean Martin**
Vesting date and
exercisable date
30 Jun 2019
31 Jul 2020
Expiry date
14 Dec 2020
31 Jul 2022
Fair value
per option
Exercise price at grant date
$0.1958
$0.0350
$0.135
$0.026
Fair value
per option
Number of
options
granted
Grant date
Vesting date and
exercisable date
Expiry date
Exercise price at grant date
5,000,000 14 Dec 2016
5,000,000 31 Jul 2019
30 Jun 2019
31 Jul 2020
14 Dec 2020
31 Jul 2022
$0.1958
$0.0350
$0.135
$0.026
*
**
these 5,000,000 options lapsed on 10 July 2020 due to the cessation of employment of the option holder.
these 5,000,000 options lapsed in July 2020 as the vesting conditions were not met.
Options granted carry no dividend or voting rights.
Additional disclosures relating to key management personnel
Shareholding
The number of shares in the Company held during the financial year by each director and other members of key
management personnel of the Group, including their personally related parties, is set out below:
Ordinary shares
Donald Sharp
Robin Beauchamp
Paul Collins
Sandra Barns
Balance at
the start of
the year
Received
as part of
remuneration
Additions
Disposals/
other
Balance at
the end of
the year
88,424,874
4,141,290
8,373,374
-
100,939,538
-
-
-
-
-
-
-
-
-
-
(10,000,000)
(4,141,290)
-
-
(14,141,290)
78,424,874
-
8,373,374
-
86,798,248
Donald Sharp also has an interest in 10,953,000 ordinary shares in the Company held by Starmay Superannuation Pty Ltd
as trustee for the Starmay Super Fund A/C Colin Scully. Donald Sharp has voting power in Starmay Superannuation Pty
Ltd in excess of 20% (relevant interest by virtue of section 608(3) of the Corporations Act 2001 (cth)).
Option holding
The number of options over ordinary shares in the Company held during the financial year by each director and other
members of key management personnel of the Group, including their personally related parties, is set out below:
Options over ordinary shares
Donald Sharp
Robin Beauchamp
Paul Collins
Sandra Barns
Dean Martin
Balance at
the start of
the year
-
5,000,000
-
-
-
5,000,000
Granted
Exercised as
remuneration
-
-
-
-
5,000,000
5,000,000
-
-
-
-
-
-
Balance at
the end of
the year
-
-
-
-
5,000,000
5,000,000
Forfeited
-
(5,000,000)
-
-
-
(5,000,000)
This concludes the remuneration report, which has been audited.
14
Integrated Payment Technologies Limited
Directors' report
30 June 2020
Shares under option
There were no unissued ordinary shares of Integrated Payment Technologies Limited under option outstanding at the date
of this report.
Shares issued on the exercise of options
There were no ordinary shares of Integrated Payments Technologies Limited issued on the exercise of options during the
year ended 30 June 2020 and up to the date of this report
Indemnity and insurance of officers
The Company has indemnified the directors and executives of the Company for costs incurred, in their capacity as a
director or executive, for which they may be held personally liable, except where there is a lack of good faith.
During the financial year, the Company paid a premium in respect of a contract to insure the directors and executives of
the Company against a liability to the extent permitted by the Corporations Act 2001. The contract of insurance prohibits
disclosure of the nature of the liability and the amount of the premium.
Indemnity and insurance of auditor
The Company has not, during or since the end of the financial year, indemnified or agreed to indemnify the auditor of the
Company or any related entity against a liability incurred by the auditor.
During the financial year, the Company has not paid a premium in respect of a contract to insure the auditor of the
Company or any related entity.
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 proceedings on
behalf of the Company, or to intervene in any proceedings to which the Company is a party for the purpose of taking
responsibility on behalf of the Company for all or part of those proceedings.
Non-audit services
Details of the amounts paid or payable to the auditor for non-audit services provided during the financial year by the auditor
are outlined in note 23 to the financial statements.
The directors are satisfied that the provision of non-audit services during the financial year, by the auditor (or by another
person or firm on the auditor's behalf), is compatible with the general standard of independence for auditors imposed by
the Corporations Act 2001.
The directors are of the opinion that the services as disclosed in note 23 to the financial statements do not compromise the
external auditor's independence requirements of the Corporations Act 2001 for the following reasons:
●
all non-audit services have been reviewed and approved to ensure that they do not impact the integrity and objectivity
of the auditor; and
none of the services undermine the general principles relating to auditor independence as set out in APES 110 Code
of Ethics for Professional Accountants (including Independence Standards) issued by the Accounting Professional
and Ethical Standards Board, including reviewing or auditing the auditor's own work, acting in a management or
decision-making capacity for the Company, acting as advocate for the Company or jointly sharing economic risks and
rewards.
●
Officers of the Company who are former partners of Grant Thornton Audit Pty Ltd
There are no officers of the Company who are former partners of Grant Thornton Audit Pty Ltd.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out
immediately after this directors' report.
Auditor
Grant Thornton Audit Pty Ltd continues in office in accordance with section 327 of the Corporations Act 2001.
15
Integrated Payment Technologies Limited
Directors' report
30 June 2020
This report is made in accordance with a resolution of directors, pursuant to section 298(2)(a) of the Corporations Act
2001.
On behalf of the directors
___________________________
Don Sharp
Executive Chairman
26 August 2020
Sydney
16
Level 17, 383 Kent Street
Sydney NSW 2000
Correspondence to:
Locked Bag Q800
QVB Post Office
Sydney NSW 1230
T +61 2 8297 2400
F +61 2 9299 445
E info.nsw@au.gt.com
W www.grantthornton.com.au
Auditor’s Independence Declaration
To the Directors of Integrated Payment Technologies Limited
In accordance with the requirements of section 307C of the Corporations Act 2001, as lead auditor for the audit of Integrated
Payment Technologies Limited for the year ended 30 June 2020, I declare that, to the best of my knowledge and belief, there
have been:
a
b
no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
no contraventions of any applicable code of professional conduct in relation to the audit.
Grant Thornton Audit Pty Ltd
Chartered Accountants
M R Leivesley
Partner – Audit & Assurance
Sydney, 26 August 2020
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
17 Integrated Payment Technologies Limited
Statement of profit or loss and other comprehensive income
For the year ended 30 June 2020
Revenue
Service fees
R&D income
Less transaction costs
Gross margin
Government grants
Interest revenue calculated using the effective interest method
Expenses
Employee benefits expense
Consulting fees
Depreciation and amortisation expense
Impairment of goodwill and other intangible assets
Impairment of receivables
Conference and marketing
Premises expense
Patents
Research and development costs
Share-based payments
ASX Listing costs
Other expenses
Finance costs
Loss before income tax (expense)/benefit
Income tax (expense)/benefit
Loss after income tax (expense)/benefit for the year attributable to the owners
of Integrated Payment Technologies Limited
Other comprehensive income for the year, net of tax
Total comprehensive income for the year attributable to the owners of
Integrated Payment Technologies Limited
Consolidated
Note
2020
$
2019
$
5
6
7
12
32
7
8
1,426,490
67,664
1,494,154
(495,361)
1,727,694
67,663
1,795,357
(449,680)
998,793
1,345,677
100,000
5,292
-
24,978
(1,755,063)
(347,546)
(1,848,327)
-
(49,880)
(218,090)
(76,685)
(8,618)
-
(74,775)
(27,842)
(344,933)
(24,183)
(1,468,849)
(276,891)
(2,070,404)
(9,667,694)
-
(271,544)
(101,696)
(6,950)
(44,290)
(61,823)
(42,278)
(326,630)
(665)
(3,671,857)
(12,969,059)
5,845
(53,019)
(3,666,012)
(13,022,078)
-
-
(3,666,012)
(13,022,078)
Cents
Cents
Basic earnings per share
Diluted earnings per share
31
31
(1.180)
(1.180)
(7.294)
(7.294)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
18
Integrated Payment Technologies Limited
Statement of financial position
As at 30 June 2020
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Total current assets
Non-current assets
Plant and equipment
Intangibles
Deferred tax asset
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Deferred R&D government grant
Borrowings
Employee benefits
Redundancy provision
Total current liabilities
Non-current liabilities
Deferred R&D government grant
Deferred tax liability
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share option reserve
Accumulated losses
Total equity
Consolidated
Note
2020
$
2019
$
9
10
11
12
13
14
16
15
17
990,954
245,869
1,236,823
1,460,240
264,041
1,724,281
23,356
2,611,156
-
2,634,512
31,747
3,546,657
563,596
4,142,000
3,871,335
5,866,281
488,497
67,663
750,000
186,966
179,125
1,672,251
244,153
67,991
-
222,584
-
534,728
67,664
-
67,664
135,000
563,596
698,596
1,739,915
1,233,324
2,131,420
4,632,957
18
22,690,408
74,775
(20,633,763)
21,600,708
674,952
(17,642,703)
2,131,420
4,632,957
The above statement of financial position should be read in conjunction with the accompanying notes
19
Integrated Payment Technologies Limited
Statement of changes in equity
For the year ended 30 June 2020
Consolidated
Balance at 1 July 2018
Loss after income tax expense for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 18)
Share-based payments (note 32)
Issued
capital
$
Share option Accumulated
reserve
$
losses
$
Total equity
$
20,056,507
613,129
(4,620,625)
16,049,011
-
-
-
-
-
-
(13,022,078)
-
(13,022,078)
-
(13,022,078)
(13,022,078)
1,544,201
-
-
61,823
-
-
1,544,201
61,823
Balance at 30 June 2019
21,600,708
674,952
(17,642,703)
4,632,957
Consolidated
Balance at 1 July 2019
Loss after income tax benefit for the year
Other comprehensive income for the year, net of tax
Total comprehensive income for the year
Transactions with owners in their capacity as owners:
Contributions of equity, net of transaction costs (note 18)
Share-based payments (note 32)
Lapsed options transferred to accumulated losses
Issued
capital
$
Share option Accumulated
reserve
$
losses
$
Total equity
$
21,600,708
674,952
(17,642,703)
4,632,957
-
-
-
-
-
-
(3,666,012)
-
(3,666,012)
-
(3,666,012)
(3,666,012)
1,089,700
-
-
-
74,775
(674,952)
-
-
674,952
1,089,700
74,775
-
Balance at 30 June 2020
22,690,408
74,775
(20,633,763)
2,131,420
The above statement of changes in equity should be read in conjunction with the accompanying notes
20
Integrated Payment Technologies Limited
Statement of cash flows
For the year ended 30 June 2020
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Government grants received
Interest and other finance costs paid
Net cash used in operating activities
Cash flows from investing activities
Payments for plant and equipment
Payments for intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Proceeds from shareholder loans
Share issue transaction costs
Net cash from financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Consolidated
Note
2020
$
2019
$
1,513,056
(3,068,220)
2,034,732
(2,882,828)
(1,555,164)
5,286
100,000
(24,183)
(848,096)
24,978
-
(665)
29
(1,474,061)
(823,783)
11
12
18
(5,576)
(817,209)
(14,174)
(1,202,214)
(822,785)
(1,216,388)
1,155,000
750,000
(77,440)
1,544,201
-
-
1,827,560
1,544,201
(469,286)
1,460,240
(495,970)
1,956,210
Cash and cash equivalents at the end of the financial year
9
990,954
1,460,240
The above statement of cash flows should be read in conjunction with the accompanying notes
21
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 1. General information
The financial statements cover Integrated Payment Technologies Limited as a Group consisting of Integrated Payment
Technologies Limited ('Company' or 'parent entity') and the entities it controlled at the end of, or during, the year (together
are referred to in these financial statements as the 'Group'). The financial statements are presented in Australian dollars,
which is Integrated Payment Technologies Limited's functional and presentation currency.
Integrated Payment Technologies Limited is a listed public company limited by shares, incorporated and domiciled in
Australia. Its registered office and principal place of business is:
Suite 1, Level 5
28 Margaret Street
Sydney NSW 2000
A description of the nature of the Group's operations and its principal activities are included in the directors' report, which is
not part of the financial statements.
The financial statements were authorised for issue, in accordance with a resolution of directors, on 26 August 2020. The
directors have the power to amend and reissue the financial statements.
Note 2. Significant accounting policies
The principal accounting policies adopted in the preparation of the financial statements are set out below. These policies
have been consistently applied to all the years presented, unless otherwise stated.
New or amended Accounting Standards and Interpretations adopted
The Group has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian
Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted.
The following Accounting Standards and Interpretations are most relevant to the Group:
AASB 16 Leases
The Group has adopted AASB 16 from 1 July 2019. The standard replaces AASB 117 'Leases' and for lessees eliminates
the classifications of operating leases and finance leases. Except for short-term leases and leases of low-value assets,
right-of-use assets and corresponding lease liabilities are recognised in the statement of financial position. Straight-line
operating lease expense recognition is replaced with a depreciation charge for the right-of-use assets (included in
operating costs) and an interest expense on the recognised lease liabilities (included in finance costs). In the earlier
periods of the lease, the expenses associated with the lease under AASB 16 will be higher when compared to lease
expenses under AASB 117. However, EBITDA (Earnings Before Interest, Tax, Depreciation and Amortisation) results
improve as the operating expense is now replaced by interest expense and depreciation in profit or loss. For classification
within the statement of cash flows, the interest portion is disclosed in operating activities and the principal portion of the
lease payments are separately disclosed in financing activities. For lessor accounting, the standard does not substantially
change how a lessor accounts for leases.
Impact of adoption of AASB 16
AASB 16 was adopted using the modified retrospective approach and as such the comparatives have not been restated.
The impact of adoption on opening retained profits as at 1 July 2019 was as follows:
Operating lease commitments as at 1 July 2019 (AASB 117)
Finance lease commitments as at 1 July 2019 (AASB 117)
Short-term leases not recognised as a right-of-use asset (AASB 16)
Right-of-use assets (AASB 16)
Increase in opening accumulated losses as at 1 July 2019
22
1 July 2019
$
26,675
-
(26,675)
-
-
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
When adopting AASB 16 from 1 July 2019, the consolidated entity has applied the following practical expedients:
●
●
●
●
●
applying a single discount rate to the portfolio of leases with reasonably similar characteristics;
accounting for leases with a remaining lease term of 12 months as at 1 July 2019 as short-term leases;
excluding any initial direct costs from the measurement of right-of-use assets;
using hindsight in determining the lease term when the contract contains options to extend or terminate the lease; and
not apply AASB 16 to contracts that were not previously identified as containing a lease.
Interpretation 23 Uncertainty over Income Tax
The Group has adopted Interpretation 23 from 1 July 2019. The interpretation clarifies how to apply the recognition and
measurement requirements of AASB 112 ‘Income Taxes’ in circumstances where uncertain tax treatments exists. The
interpretation requires: the Group to determine whether each uncertain tax treatment should be treated separately or
together, based on which approach better predicts the resolution of the uncertainty; the Group to consider whether it is
probable that a taxation authority will accept an uncertain tax treatment; and if the Group concludes that it is not probable
that the taxation authority will accept an uncertain tax treatment, it shall reflect the effect of uncertainty in determining the
related taxable profit (tax loss), tax bases, unused tax losses, unused tax credits or tax rates, measuring the tax uncertainty
based on either the most likely amount or the expected value. In making the assessment it is assumed that a taxation
authority will examine amounts it has a right to examine and have full knowledge of all related information when making
those examinations. Management has considered all facts and circumstances as it relates to the Group and believe there
is no material uncertainty over the availability of the tax losses and other deductions to the Group.
Going concern
The financial statements has been prepared on a going concern basis which contemplates continuity of normal business
activities and the realisation of assets and settlement of liabilities in the ordinary course of business. For the year ended 30
June 2020, the Group recorded a loss before income tax benefit, impairment of intangibles, amortisation and depreciation
and share-based payments of $1,764,175 (2019: loss of $1,168,743 ); showed net cash outflows from investing activities of
$822,785 (2019: $1,216,388) and net cash outflows from operating activities of $1,474,061 (2019: $823,783). The net
assets of the Group as at 30 June 2020 were $2,131,420 (2019: $4,632,957).
As at 30 June 2020, the Group had cash and cash equivalents of $990,954. In addition, the Company raised $2,316,302
from non-renounceable entitlement offer including the shortfall. COVID-19 restrictions, other than the fall in interest rates
have not had a material impact on the financial performance or financial position of the Group.
The directors are of the opinion that the Group will continue to obtain additional capital when the business requires and
accordingly have prepared the financial statements on a going concern basis.
At the date of approval of these financial statements, the directors are of the opinion that no asset is likely to be realised for
an amount less than the amount at which it is recorded in the financial statements at 30 June 2020. Accordingly, no
adjustments have been made to the financial statements relating to the recoverability and classification of the asset
carrying amounts or the amounts and classifications of liabilities that might be necessary.
Basis of preparation
These general purpose financial statements have been prepared in accordance with Australian Accounting Standards and
Interpretations issued by the Australian Accounting Standards Board ('AASB') and the Corporations Act 2001, as
appropriate for for-profit oriented entities. These financial statements also comply with International Financial Reporting
Standards as issued by the International Accounting Standards Board ('IASB').
Historical cost convention
The financial statements have been prepared under the historical cost convention.
Critical accounting estimates
The preparation of the financial statements requires the use of certain critical accounting estimates. It also requires
management to exercise its judgement in the process of applying the Group's accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial
statements, are disclosed in note 3.
Parent entity information
In accordance with the Corporations Act 2001, these financial statements present the results of the Group only.
Supplementary information about the parent entity is disclosed in note 27.
23
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Integrated Payment
Technologies Limited as at 30 June 2020 and the results of all subsidiaries for the year then ended.
Subsidiaries are all those entities over which the Group has control. The Group controls an entity when the Group is
exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns
through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the Group are eliminated.
Unrealised losses are also eliminated unless the transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted
by the Group.
The acquisition of subsidiaries is accounted for using the acquisition method of accounting. A change in ownership interest,
without the loss of control, is accounted for as an equity transaction, where the difference between the consideration
transferred and the book value of the share of the non-controlling interest acquired is recognised directly in equity
attributable to the parent.
Where the Group loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and non-
controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The Group
recognises the fair value of the consideration received and the fair value of any investment retained together with any gain
or loss in profit or loss.
Operating segments
Operating segments are presented using the 'management approach', where the information presented is on the same
basis as the internal reports provided to the Chief Operating Decision Makers ('CODM'). The CODM is responsible for the
allocation of resources to operating segments and assessing their performance.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable. The Group recognises revenue when
the amount can be reliably measured, it is probable that future economic benefits will flow to the consolidated group and
specific criteria for each of the activities.
Revenue is recognised for the major business activities as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the Group is expected to be entitled in
exchange for transferring goods or services to a customer. For each contract with a customer, the Group: identifies the
contract with a customer; identifies the performance obligations in the contract; determines the transaction price which
takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the
separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be
delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the
transfer to the customer of the goods or services promised. The Group's performance is completed at the time of providing
the service.
Variable consideration within the transaction price, if any, reflects concessions provided to the customer such as discounts,
rebates and refunds, any potential bonuses receivable from the customer and any other contingent events. Such estimates
are determined using either the 'expected value' or 'most likely amount' method. The measurement of variable
consideration is subject to a constraining principle whereby revenue will only be recognised to the extent that it is highly
probable that a significant reversal in the amount of cumulative revenue recognised will not occur. The measurement
constraint continues until the uncertainty associated with the variable consideration is subsequently resolved. Amounts
received that are subject to the constraining principle are recognised as a refund liability.
24
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Service fees and transaction fees
Service fees are earned where the group provides facility services to the customer which is identified as a single
performance obligation. The performance obligation is satisfied by the service being available for customer use over time
therefore revenue is recognised over time. Service fees are rendered based on a fixed price. Transaction fees are
recognised as revenue at a point in time based on the satisfaction of the performance obligation being the being the
completion of the transaction.
Float interest
Float interest income comprises interest income on funds held over the standard processing period. Interest income is
recognised as it accrues in profit or loss, using the effective interest method.
Government grants
Government grants relating to costs incurred are deferred and recognised in profit or loss over the period necessary to
match them with the costs that they are intended to compensate
Income tax
The income tax expense or benefit for the period is the tax payable on that period's taxable income based on the
applicable income tax rate for each jurisdiction, adjusted by the changes in deferred tax assets and liabilities attributable to
temporary differences, unused tax losses and the adjustment recognised for prior periods, where applicable.
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to be applied when
the assets are recovered or liabilities are settled, based on those tax rates that are enacted or substantively enacted,
except for:
● When the deferred income tax asset or liability arises from the initial recognition of goodwill or an asset or liability in a
transaction that is not a business combination and that, at the time of the transaction, affects neither the accounting
nor taxable profits; or
● When the taxable temporary difference is associated with interests in subsidiaries, associates or joint ventures, and
the timing of the reversal can be controlled and it is probable that the temporary difference will not reverse in the
foreseeable future.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
The carrying amount of recognised and unrecognised deferred tax assets are reviewed at each reporting date. Deferred
tax assets recognised are reduced to the extent that it is no longer probable that future taxable profits will be available for
the carrying amount to be recovered. Previously unrecognised deferred tax assets are recognised to the extent that it is
probable that there are future taxable profits available to recover the asset.
Deferred tax assets and liabilities are offset only where there is a legally enforceable right to offset current tax assets
against current tax liabilities and deferred tax assets against deferred tax liabilities; and they relate to the same taxable
authority on either the same taxable entity or different taxable entities which intend to settle simultaneously.
Integrated Payment Technologies Limited (the 'head entity') and its wholly-owned Australian subsidiaries have formed an
income tax consolidated group under the tax consolidation regime. The head entity and each subsidiary in the tax
consolidated group continue to account for their own current and deferred tax amounts. The tax consolidated group has
applied the 'separate taxpayer within group' approach in determining the appropriate amount of taxes to allocate to
members of the tax consolidated group.
In addition to its own current and deferred tax amounts, the head entity also recognises the current tax liabilities (or assets)
and the deferred tax assets arising from unused tax losses and unused tax credits assumed from each subsidiary in the tax
consolidated group.
Assets or liabilities arising under tax funding agreements with the tax consolidated entities are recognised as amounts
receivable from or payable to other entities in the tax consolidated group. The tax funding arrangement ensures that the
intercompany charge equals the current tax liability or benefit of each tax consolidated group member, resulting in neither a
contribution by the head entity to the subsidiaries nor a distribution by the subsidiaries to the head entity.
25
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Current and non-current classification
Assets and liabilities are presented in the statement of financial position based on current and non-current classification.
An asset is classified as current when: it is either expected to be realised or intended to be sold or consumed in the
Group's normal operating cycle; it is held primarily for the purpose of trading; it is expected to be realised within 12 months
after the reporting period; or the asset is cash or cash equivalent unless restricted from being exchanged or used to settle
a liability for at least 12 months after the reporting period. All other assets are classified as non-current.
A liability is classified as current when: it is either expected to be settled in the Group's normal operating cycle; it is held
primarily for the purpose of trading; it is due to be settled within 12 months after the reporting period; or there is no
unconditional right to defer the settlement of the liability for at least 12 months after the reporting period. All other liabilities
are classified as non-current.
Deferred tax assets and liabilities are always classified as non-current.
Cash and cash equivalents
Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions, other short-term, highly
liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and
which are subject to an insignificant risk of changes in value.
Trade and other receivables
Trade receivables are initially recognised at fair value and subsequently measured at amortised cost using the effective
interest method, less any allowance for expected credit losses. Trade receivables are generally due for settlement within
30 days.
The Group has applied the simplified approach to measuring expected credit losses, which uses a lifetime expected loss
allowance. To measure the expected credit losses, trade receivables have been grouped based on days overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
Plant and equipment
Plant and equipment is stated at historical cost less accumulated depreciation and impairment. Historical cost includes
expenditure that is directly attributable to the acquisition of the items.
Depreciation is calculated on a diminishing value basis to write off the net cost of each item of plant and equipment over
their expected useful lives as follows:
Leasehold improvements
Plant and equipment
Office equipment
20%
60%
20% - 60%
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting
date.
An item of plant and equipment is derecognised upon disposal or when there is no future economic benefit to the Group.
Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Intangible assets
Intangible assets acquired as part of a business combination, other than goodwill, are initially measured at their fair value
at the date of the acquisition. Intangible assets acquired separately are initially recognised at cost. Finite life intangible
assets are subsequently measured at cost less amortisation and any impairment. The gains or losses recognised in profit
or loss arising from the derecognition of intangible assets are measured as the difference between net disposal proceeds
and the carrying amount of the intangible asset. The method and useful lives of finite life intangible assets are reviewed
annually. Changes in the expected pattern of consumption or useful life are accounted for prospectively by changing the
amortisation method or period.
26
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Goodwill
Goodwill arises on the acquisition of a business. Goodwill is not amortised. Instead, goodwill is tested annually for
impairment, or more frequently if events or changes in circumstances indicate that it might be impaired, and is carried at
cost less accumulated impairment losses. Impairment losses on goodwill are taken to profit or loss and are not
subsequently reversed.
Patents
Significant costs associated with patents are deferred and amortised on a straight-line basis over the period of their
expected benefit, being their finite useful life of the underlying patent.
Software
Significant costs associated with software are deferred and amortised on a straight-line basis over the period of their
expected benefit, being their finite life of five years.
Client relationships
Significant costs associated with acquired client relationships are deferred and amortised on a straight-line basis over the
period of their expected benefit, being their finite useful life of four years.
During the year ended 30 June 2020, the Group reviewed the appropriateness of the amortisation period and methodology
for client relationships and determined that the period be reduced from 5 years to 4 years, reflecting an updated
assessment of the services being provided to the client base. Amortisation of the client relationship intangible asset was
accelerated from 1 January 2020 with an additional $563,694 recorded through the consolidated statement of profit or loss
in the year ended 30 June 2020.
Research costs and assets under development
Research costs are expensed in the period in which they are incurred. Development costs are capitalised when it is
probable that the project will be a success considering its commercial and technical feasibility; the Group is able to use or
sell the asset; the Group has sufficient resources; and intent to complete the development and its costs can be measured
reliably. Amortisation commences when the asset is available for use, that is when it is in the location and condition
necessary for it to be capable of operating in the manner intended by management.
Impairment of non-financial assets
Non-financial assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. Goodwill and assets under development are tested annually for impairment, or more
frequently if events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment
loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount.
Recoverable amount is the higher of an asset's fair value less costs of disposal and value-in-use. The value-in-use is the
present value of the estimated future cash flows relating to the asset using a pre-tax discount rate specific to the asset or
cash-generating unit to which the asset belongs. Assets that do not have independent cash flows are grouped together to
form a cash-generating unit.
Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year and
which are unpaid. Due to their short-term nature they are measured at amortised cost and are not discounted. The
amounts are unsecured and are usually paid within 30 days of recognition.
Borrowings
Loans and borrowings are initially recognised at the fair value of the consideration received, net of transaction costs. They
are subsequently measured at amortised cost using the effective interest method.
Finance costs
Finance costs attributable to qualifying assets are capitalised as part of the asset. All other finance costs are expensed in
the period in which they are incurred.
27
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
Provisions
Provisions are recognised when the Group has a present (legal or constructive) obligation as a result of a past event, it is
probable the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of the
obligation. The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. If the time value
of money is material, provisions are discounted using a current pre-tax rate specific to the liability. The increase in the
provision resulting from the passage of time is recognised as a finance cost.
Employee benefits
Short-term employee benefits
Liabilities for wages and salaries, including non-monetary benefits, annual leave and long service leave expected to be
settled wholly within 12 months of the reporting date are measured at the amounts expected to be paid when the liabilities
are settled.
Other long-term employee benefits
The liability for annual leave and long service leave not expected to be settled within 12 months of the reporting date are
measured at the present value of expected future payments to be made in respect of services provided by employees up to
the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures
and periods of service. Expected future payments are discounted using market yields at the reporting date on high-quality
corporate bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows.
Defined contribution superannuation expense
Contributions to defined contribution superannuation plans are expensed in the period in which they are incurred.
Share-based payments
Equity-settled share-based compensation benefits are provided to employees.
Equity-settled transactions are awards of shares, or options over shares, that are provided to employees in exchange for
the rendering of services.
The cost of equity-settled transactions are measured at fair value on grant date. Fair value is independently determined
using either the Binomial or Black-Scholes option pricing model that takes into account the exercise price, the term of the
option, the impact of dilution, the share price at grant date and expected price volatility of the underlying share, the
expected dividend yield and the risk free interest rate for the term of the option, together with non-vesting conditions that do
not determine whether the Group receives the services that entitle the employees to receive payment. No account is taken
of any other vesting conditions.
The cost of equity-settled transactions are recognised as an expense with a corresponding increase in equity over the
vesting period. The cumulative charge to profit or loss is calculated based on the grant date fair value of the award, the
best estimate of the number of awards that are likely to vest and the expired portion of the vesting period. The amount
recognised in profit or loss for the period is the cumulative amount calculated at each reporting date less amounts already
recognised in previous periods.
Market conditions are taken into consideration in determining fair value. Therefore any awards subject to market conditions
are considered to vest irrespective of whether or not that market condition has been met, provided all other conditions are
satisfied.
If equity-settled awards are modified, as a minimum an expense is recognised as if the modification has not been made.
An additional expense is recognised, over the remaining vesting period, for any modification that increases the total fair
value of the share-based compensation benefit as at the date of modification.
If the non-vesting condition is within the control of the Group or employee, the failure to satisfy the condition is treated as a
cancellation. If the condition is not within the control of the Group or employee and is not satisfied during the vesting
period, any remaining expense for the award is recognised over the remaining vesting period, unless the award is forfeited.
28
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
If equity-settled awards are cancelled, it is treated as if it has vested on the date of cancellation, and any remaining
expense is recognised immediately. If a new replacement award is substituted for the cancelled award, the cancelled and
new award is treated as if they were a modification.
Fair value measurement
When an asset or liability, financial or non-financial, is measured at fair value for recognition or disclosure purposes, the
fair value is based on the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction
between market participants at the measurement date; and assumes that the transaction will take place either: in the
principal market; or in the absence of a principal market, in the most advantageous market.
Fair value is measured using the assumptions that market participants would use when pricing the asset or liability,
assuming they act in their economic best interests. For non-financial assets, the fair value measurement is based on its
highest and best use. Valuation techniques that are appropriate in the circumstances and for which sufficient data are
available to measure fair value, are used, maximising the use of relevant observable inputs and minimising the use of
unobservable inputs.
Assets and liabilities measured at fair value are classified into three levels, using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. Classifications are reviewed at each reporting date and
transfers between levels are determined based on a reassessment of the lowest level of input that is significant to the fair
value measurement.
For recurring and non-recurring fair value measurements, external valuers may be used when internal expertise is either
not available or when the valuation is deemed to be significant. External valuers are selected based on market knowledge
and reputation. Where there is a significant change in fair value of an asset or liability from one period to another, an
analysis is undertaken, which includes a verification of the major inputs applied in the latest valuation and a comparison,
where applicable, with external sources of data.
Issued capital
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax,
from the proceeds.
Dividends
Dividends are recognised when declared during the financial year and no longer at the discretion of the Company.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Integrated Payment Technologies
Limited, excluding any costs of servicing equity other than ordinary shares, by the weighted average number of ordinary
shares outstanding during the financial year, adjusted for bonus elements in ordinary shares issued during the financial
year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account
the after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the
weighted average number of shares assumed to have been issued for no consideration in relation to dilutive potential
ordinary shares.
Goods and Services Tax ('GST') and other similar taxes
Revenues, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not
recoverable from the tax authority. In this case it is recognised as part of the cost of the acquisition of the asset or as part
of the expense.
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 tax authority is included in other receivables or other payables in the statement of
financial position.
29
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 2. Significant accounting policies (continued)
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 tax authority, are presented as operating cash flows.
Commitments and contingencies are disclosed net of the amount of GST recoverable from, or payable to, the tax authority.
New Accounting Standards and Interpretations not yet mandatory or early adopted
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet
mandatory, have not been early adopted by the Group for the annual reporting period ended 30 June 2020. The Group's
assessment of the impact of these new or amended Accounting Standards and Interpretations, most relevant to the Group,
are set out below.
Conceptual Framework for Financial Reporting (Conceptual Framework)
The revised Conceptual Framework is applicable to annual reporting periods beginning on or after 1 January 2020 and
early adoption is permitted. The Conceptual Framework contains new definition and recognition criteria as well as new
guidance on measurement that affects several Accounting Standards. Where the Group has relied on the existing
framework in determining its accounting policies for transactions, events or conditions that are not otherwise dealt with
under the Australian Accounting Standards, the Group may need to review such policies under the revised framework. At
this time, the application of the Conceptual Framework is not expected to have a material impact on the Group's financial
statements.
Note 3. Critical accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make judgements, estimates and assumptions that
affect the reported amounts in the financial statements. Management continually evaluates its judgements and estimates in
relation to assets, liabilities, contingent liabilities, revenue and expenses. Management bases its judgements, estimates
and assumptions on historical experience and on other various factors, including expectations of future events,
management believes to be reasonable under the circumstances. The resulting accounting judgements and estimates will
seldom equal the related actual results. The judgements, estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities (refer to the respective notes) within the next
financial year are discussed below.
COVID-19 pandemic
Judgement has been exercised in considering the impacts that the COVID-19 pandemic has had, or may have, on the
Group based on known information. This consideration extends to the nature of the products and services offered,
customers, supply chain, staffing and geographic regions in which the Group operates. Other than as addressed in specific
notes, there does not currently appear to be either any significant impact upon the financial statements or any significant
uncertainties with respect to events or conditions which may impact the Group unfavourably as at the reporting date or
subsequently as a result of the COVID-19 pandemic.
Share-based payment transactions
The Group measures the cost of equity-settled transactions with employees by reference to the fair value of the equity
instruments at the date at which they are granted. The fair value is determined by using either the Binomial or Black-
Scholes model taking into account the terms and conditions upon which the instruments were granted. The accounting
estimates and assumptions relating to equity-settled share-based payments would have no impact on the carrying amounts
of assets and liabilities within the next annual reporting period but may impact profit or loss and equity.
Goodwill and other indefinite life intangible assets
The Group tests annually, or more frequently if events or changes in circumstances indicate impairment, whether goodwill
has suffered any impairment, in accordance with the accounting policy stated in note 2. The recoverable amount of the
cash-generating unit have been determined based on calculations to determine fair value less cost of disposal. These
calculations require the use of assumptions, including estimated discount rates based on the current cost of capital and
growth rates of the estimated future cash flows.
30
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 3. Critical accounting judgements, estimates and assumptions (continued)
Impairment of non-financial assets other than goodwill and other indefinite life intangible assets
The Group assesses impairment of non-financial assets other than goodwill and other indefinite life intangible assets at
each reporting date by evaluating conditions specific to the Group and to the particular asset that may lead to impairment.
If an impairment trigger exists, the recoverable amount of the asset is determined. This involves fair value less costs of
disposal or value-in-use calculations, which incorporate a number of key estimates and assumptions.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the Group considers it is probable that
future taxable amounts will be available to utilise those temporary differences and losses.
Capitalised software development costs
Distinguishing the research and development phases of a new customised software project and determining whether the
recognition requirements for capitalisation of development costs are met requires judgement. After capitalisation,
management monitors whether the recognition requirements continue to be met and whether there are any indicators that
capitalised costs may be impaired.
Note 4. Operating segments
The Group is organised into one operating segment relating to the commercialisation of the process underlying the patents
granted and applied for to link data with payments services. It operates in the one geographical segment of Australia.
The information reported to the Board of Directors (being the Chief Operating Decision Makers ('CODM')) consists of the
results as shown in the statement of profit or loss and other comprehensive income and statement of financial position in
this Annual Report and has therefore not been replicated as segment disclosure.
The directors have determined that there are no operating segments identified for the year which are considered
separately reportable.
Major customers
During the year ended 30 June 2020 and 30 June 2019 there were no significant sales to one major customer.
Note 5. Revenue
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is as follows:
Major product lines
ClickSuper
Payment Adviser
Timing of revenue recognition
Services transferred at a point in time
Services transferred over time
31
Consolidated
2020
$
2019
$
1,405,120
21,370
1,715,905
11,789
1,426,490
1,727,694
1,074,861
351,629
1,383,723
343,971
1,426,490
1,727,694
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 6. Government grants
Government grants (COVID-19)
Consolidated
2020
$
2019
$
100,000
-
Government grants (COVID-19)
During the year the Group received payments from the Australian Government amounting to $100,000 as part of its
‘Boosting Cash Flow for Employers’ scheme in response to the COVID-19 pandemic. Eligible employers with aggregated
annual turnover of less than $50 million are eligible to receive payments of between $20,000 and $100,000 which are
credited against amounts owed on an activity statement and based on PAYG withheld on employee’s salary and wages for
the period March to September 2020. Such amounts have been recognised as government grants in the financial
statements, are non-taxable, and are recorded as income once there is reasonable assurance that the Group will comply
with any required conditions which is practically at the time that a liability for PAYG withholding tax is incurred and salaries
are paid.
Note 7. Expenses
Loss before income tax includes the following specific expenses:
Depreciation
Leasehold improvements
Plant and equipment
Office equipment
Total depreciation
Amortisation
Patents
Software
Client relationships
PayVu
Total amortisation
Total depreciation and amortisation
Finance costs
Interest and finance charges paid/payable on borrowings
Leases
Minimum lease payments
Short-term lease payments
Superannuation expense
Defined contribution superannuation expense
32
Consolidated
2020
$
2019
$
2,562
11,069
336
13,967
3,211
6,093
420
9,724
22,738
365,901
562,694
320,333
24,952
666,340
1,024,720
344,668
1,271,666
2,060,680
1,285,633
2,070,404
24,183
665
-
76,685
101,696
-
76,685
101,696
172,312
174,485
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 8. Income tax expense/(benefit)
Income tax expense/(benefit)
Current tax expense
Deferred tax - origination and reversal of temporary differences
Aggregate income tax expense/(benefit)
Deferred tax included in income tax expense/(benefit) comprises:
Decrease in deferred tax assets (note 13)
Decrease in deferred tax liabilities (note 17)
Deferred tax - origination and reversal of temporary differences
Numerical reconciliation of income tax expense/(benefit) and tax at the statutory rate
Loss before income tax (expense)/benefit
Tax at the statutory tax rate of 27.5%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Impairment of intangibles
Permanent differences
Share-based payments
Current year temporary differences not recognised
Adjustment recognised for prior periods
Income tax expense/(benefit)
Note 9. Current assets - cash and cash equivalents
Cash at bank
Cash on deposit
Consolidated
2020
$
2019
$
(5,845)
-
5,845
47,174
(5,845)
53,019
563,596
(563,596)
328,972
(281,798)
-
47,174
(3,671,857)
(12,969,059)
(1,009,761)
(3,566,491)
-
-
-
2,658,616
391,737
16,831
(1,009,761)
998,071
5,845
(499,307)
-
552,326
(5,845)
53,019
Consolidated
2020
$
2019
$
967,817
23,137
198,609
1,261,631
990,954
1,460,240
33
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 10. Current assets - trade and other receivables
Trade receivables
Less: Allowance for expected credit losses
Other receivables
Goods and services tax receivable
Prepayments
Consolidated
2020
$
2019
$
211,213
(49,880)
161,333
3,998
23,468
57,070
154,585
-
154,585
2,170
41,426
65,860
245,869
264,041
Allowance for expected credit losses
The Group has recognised a loss of $49,880 (2019: $nil) in profit or loss in respect of impairment of receivables for the
year ended 30 June 2020.
The ageing of the receivables and allowance for expected credit losses provided for above are as follows:
Expected
credit loss
rate
2020
%
Carrying
amount
2020
$
Allowance
for expected
credit losses
2020
$
-
-
-
194,259
14,961
1,993
32,926
14,961
1,993
211,213
49,880
Consolidated
2020
$
2019
$
25,081
(14,087)
10,994
38,612
(27,691)
10,921
3,173
(1,732)
1,441
25,081
(11,525)
13,556
33,036
(16,622)
16,414
3,173
(1,396)
1,777
23,356
31,747
Consolidated
Not overdue
3 to 6 months overdue
Over 6 months overdue
Note 11. Non-current assets - plant and equipment
Leasehold improvements - at cost
Less: Accumulated depreciation
Plant and equipment - at cost
Less: Accumulated depreciation
Office equipment - at cost
Less: Accumulated depreciation
34
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 11. Non-current assets - plant and equipment (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2018
Additions
Depreciation expense
Balance at 30 June 2019
Additions
Depreciation expense
Balance at 30 June 2020
Note 12. Non-current assets - intangibles
Goodwill - at cost
Less: Impairment
Patents and trademarks - at cost
Less: Accumulated amortisation
Less: Impairment
Software - at cost
Less: Accumulated amortisation
Less: Impairment
Client relationships - at cost
Less: Accumulated amortisation
Less: Impairment
Leasehold
improvements
$
Plant and
equipment
$
Office
equipment
$
Total
$
16,767
-
(3,211)
13,556
-
(2,562)
8,333
14,174
(6,093)
16,414
5,576
(11,069)
2,197
-
(420)
1,777
-
(336)
27,297
14,174
(9,724)
31,747
5,576
(13,967)
10,994
10,921
1,441
23,356
Consolidated
2020
$
2019
$
6,755,549
(6,755,549)
-
6,755,549
(6,755,549)
-
1,006,790
(103,235)
(320,960)
582,595
6,940,171
(3,244,477)
(1,667,133)
2,028,561
5,123,600
(4,199,548)
(924,052)
-
792,349
(80,497)
(320,960)
390,892
6,255,753
(2,558,243)
(1,667,133)
2,030,377
5,123,600
(3,074,160)
(924,052)
1,125,388
2,611,156
3,546,657
35
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 12. Non-current assets - intangibles (continued)
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Consolidated
Balance at 1 July 2018
Additions
Impairment of assets
Amortisation expense
Balance at 30 June 2019
Additions
Amortisation expense
Balance at 30 June 2020
Goodwill
$
6,755,549
-
(6,755,549)
-
Patents and
trademarks
$
Software
$
Client
relationships
$
Total
$
626,817
109,987
(320,960)
(24,952)
3,616,291
1,092,227
(1,667,133)
(1,011,008)
3,074,160
-
(924,052)
(1,024,720)
14,072,817
1,202,214
(9,667,694)
(2,060,680)
-
-
-
-
390,892
214,441
(22,738)
2,030,377
684,418
(686,234)
1,125,388
-
(1,125,388)
3,546,657
898,859
(1,834,360)
582,595
2,028,561
-
2,611,156
Impairment tests for goodwill and all other intangibles
Goodwill acquired through business combinations has been allocated to and is tested at the level of their respective cash
generating units (CGUs), for impairment testing.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately
identifiable cash flows. In determining the recoverable amount of assets, in absence of quoted market prices, estimates are
made regarding the present value of future post tax cash flows. Where separately identifiable cash flows cannot be
identified at the asset level, they have then been assessed at the CGU level.
For the purpose of impairment testing of goodwill and other intangible assets, ClickSuper, Payment Adviser and PayVu are
assessed as one CGU due to the commonality of the client base and the cross service offering provided meaning cash
infows are not independent of one another. Furthermore, the businesses utilises the same software and operate in the
same premise where various resources and costs are shared. Therefore, they do not operate independently and are
considered as one CGU (the ‘CGU’).
In the prior year, following the delayed release of PayVu, management calculated the recoverable amount of the CGU as
at 30 June 2019. An impairment loss of $9,667,694 was recognised. Firstly, the carrying amount of goodwill was reduced
to $nil. The remaining impairment loss of $2,912,145 was apportioned to the other intangible assets.
As of 30 June 2020, the recoverable amount of the CGU was determined based on a fair value less cost of disposal,
consistent with the methods used as at 30 June 2019. Based on the impairment test the recoverable amount exceeds the
carrying amount and therefore no impairment exists as at 30 June 2020.
Key assumptions used in DCF calculations
The recoverable amount of the CGU is calculated as the higher of the CGU’s value in use and its fair value less cost of
disposal. Management has calculated the fair cost less cost of disposal of the CGU. The primary valuation methodology
was a discounted cash flow (DCF) analysis.
The calculation of fair value less cost of disposal in use for the CGU was most sensitive to the following assumptions:
●
●
Revenue growth; and
Discount rates.
Revenue growth is based on the forecast for the financial years ending 30 June 2021 and 30 June 2022 as well as
management 10% revenue growth assessment over the forecast period to June 2025.
36
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 12. Non-current assets - intangibles (continued)
Pricing assumptions
Due to the decrease in float interest income the Group has determined to increase the transaction fees from 10 cents to 13
cents to make up for the loss income. Prior year income was below:
Float interest
Transaction fees
Interest as percentage
2018
2019
2020
$516,439
$697,961
74%
$528,319
$647,579
81%
$156,685
$611,476
25.6%
The Group will be launching a new functionality in onboarding employers which will increase the services and provide
additional income to the 13 cents.
Discount and long term growth rates
Discount rates represent the current market assessment of the risks specific to the Group, taking into account the time
value of money and specific risk of the underlying assets that have not been incorporated into the cash flow estimates. The
discount rate is calculated using the weighted average cost of capital (WACC) and reflect management’s estimation of the
time value of money and specific risk estimated for the Group. The WACC takes into account both debt and equity. The
cost of equity is derived from the expected return on investment by the Group’s investors. It incorporates a beta factor to
reflect the specific risk associated with the industries in which the Group operates. The cost of debt is based on the interest
bearing borrowings the Group is obliged to service. A pre-tax discount rate of 17.66% p.a. (2019: 17.66% p.a.) was applied
in the valuation model.
It is assumed for the purpose of the analysis that the long term growth rate (terminal rate) will equate to the long term
average growth rate of the national economy. Management estimates this to be 2.5% p.a. The sensitivity analysis
concluded that changing this rate to reflect possible lower growth projections would not materially impact the valuations.
Costs of disposal have been estimated by management at 5% in determining fair value less costs of disposal.
Fair value less costs of disposal is measured using some inputs that are not based on observable market data. Therefore
they are deemed level three within the fair value hierarchy as per AASB 13 Fair Value Measurement.
The following table sets out the summary key assumptions for the CGU:
Forecasts
30 Jun 2020
30 Jun 2019
Revenue growth
Discount rates - weighted average cost of capital
(WACC)
FY21 increased by 48%
FY22 increased by 52%
FY23 to FY25 is increased by 10%
p.a.%
17%
FY20 to FY23 is increased by 5%
p.a.%
17%
Sensitivity to changes in assumptions
Management have considered and assessed reasonably possible changes in key assumptions as at 30 June
2020. Management have noted that the assumptions within revenue forecasts would have decrease by 18.27% or the
discount rate increase to 26.7% for the recoverable amount to equal the carrying amount.
Management does not consider these changes in assumptions to be reasonably possible.
37
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 13. Non-current assets - deferred tax asset
Deferred tax asset comprises temporary differences attributable to:
Amounts recognised in profit or loss:
Tax losses
Plant and equipment
Employee benefits
Accrued expenses
Costs of capital raising
Costs of Initial Public Offer
ASX listing and transaction costs
DTA write-off
Deferred tax asset
Movements:
Opening balance
Charged to profit or loss (note 8)
Closing balance
Note 14. Current liabilities - trade and other payables
Trade payables
Accrued expenses
Other payables
Refer to note 20 for further information on financial instruments.
Note 15. Current liabilities - borrowings
Shareholder loans
Consolidated
2020
$
2019
$
2,198,469
315,019
80,989
14,044
40,413
31,812
970
(2,681,716)
425,961
(67,933)
58,900
18,700
58,977
66,939
2,052
-
-
563,596
563,596
(563,596)
892,568
(328,972)
-
563,596
Consolidated
2020
$
2019
$
249,183
61,410
177,904
117,330
50,980
75,843
488,497
244,153
Consolidated
2020
$
2019
$
750,000
-
Shareholder loans
Shareholder loans mature after 12 months from the date of issue (30 October 2019). Interest accrues at the rate of 8% per
annum. These loans were subsequently paid on 15 July 2020 after completion of the entitlement offer on issue of new
ordinary shares of the Company.
38
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 16. Current liabilities - deferred R&D government grant
Deferred R&D government grant
Note 17. Non-current liabilities - deferred tax liability
Deferred tax liability comprises temporary differences attributable to:
Amounts recognised in profit or loss:
Client relationships
Deferred tax liability
Movements:
Opening balance
Credited to profit or loss (note 8)
Closing balance
Note 18. Equity - issued capital
Consolidated
2020
$
2019
$
67,663
67,991
Consolidated
2020
$
2019
$
-
-
563,596
563,596
563,596
(563,596)
845,394
(281,798)
-
563,596
Consolidated
2020
Shares
2019
Shares
2020
$
2019
$
Ordinary shares - fully paid
385,840,298
308,840,298
22,690,408
21,600,708
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
Issue of shares - entitlement offer
Issue of shares - retail offer
Balance
Issue of shares - entitlement offer
Less: share issue transaction costs
1 July 2018
18 April 2019
22 May 2019
30 June 2019
22 June 2020
154,420,149
77,070,611
77,349,538
308,840,298
77,000,000
-
Balance
30 June 2020
385,840,298
$0.0100
$0.0100
$0.0150
$0.0000
20,056,507
770,706
773,495
21,600,708
1,155,000
(65,300)
22,690,408
Ordinary shares
Ordinary shares entitle the holder to participate in dividends and the proceeds on the winding up of the Company in
proportion to the number of and amounts paid on the shares held. The fully paid ordinary shares have no par value and the
Company does not have a limited amount of authorised capital.
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
39
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 18. Equity - issued capital (continued)
Share buy-back
There is no current on-market share buy-back.
Capital risk management
The Group's objectives when managing capital is to safeguard its ability to continue as a going concern, so that it can
provide returns for shareholders and benefits for other stakeholders and to maintain an optimum capital structure to reduce
the cost of capital.
Capital is regarded as total equity, as recognised in the statement of financial position, plus net debt. Net debt is calculated
as total borrowings less cash and cash equivalents.
Management assesses the Group’s capital requirements in order to maintain an efficient overall funding structure while
avoiding excessive leverage. The Group manages the capital structure and makes adjustments to it in light of changes in
economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital
structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new
shares or sell assets to reduce debt.
The Group would look to raise capital when an opportunity to invest in a business or company was seen as value adding
relative to the current Company's share price at the time of the investment.
The capital risk management policy remains unchanged from the 2019 Annual Report.
Note 19. Equity - dividends
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Franking credits
The Group has not paid income tax and there are no franking credits.
Note 20. Financial instruments
Financial risk management objectives
The Group's activities expose it to a variety of financial risks: market risk, credit risk and liquidity risk. The Group's overall
risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse
effects on the financial performance of the Group. The Group uses different methods to measure different types of risk to
which it is exposed. These methods include sensitivity analysis in the case of interest rate, foreign exchange and other
price risks, ageing analysis for credit risk. The Group does not use derivative financial instruments to manage risk.
Risk management is carried out by senior finance executives ('finance') under policies approved by the Board of Directors
('the Board'). These policies include identification and analysis of the risk exposure of the Group and appropriate
procedures, controls and risk limits. Finance identifies, evaluates and hedges financial risks within the Group's operating
units. Finance reports to the Board on a monthly basis.
Market risk
Foreign currency risk, price risk and interest rate risk
The Group is not exposed to any significant foreign exchange risk, price risk or interest rate risk.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The maximum exposure to credit risk at the reporting date to recognised financial assets is the carrying amount, net
of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the
financial statements. The Group does not hold any collateral.
40
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 20. Financial instruments (continued)
The Group has adopted a lifetime expected loss allowance in estimating expected credit losses to trade receivables
through the use of a provisions matrix using fixed rates of credit loss provisioning. These provisions are considered
representative across all customers of the Group based on recent sales experience, historical collection rates and forward-
looking information that is available.
Generally, trade receivables are written off when there is no reasonable expectation of recovery. Indicators of this include
the failure of a debtor to engage in a repayment plan, no active enforcement activity and a failure to make contractual
payments for a period greater than 1 year.
The Group is not exposed to any significant credit risk.
Liquidity risk
Vigilant liquidity risk management requires the Group to maintain sufficient liquid assets (mainly cash and cash
equivalents) and available borrowing facilities to be able to pay debts as and when they become due and payable.
The Group manages liquidity risk by maintaining adequate cash reserves and available borrowing facilities by continuously
monitoring actual and forecast cash flows and matching the maturity profiles of financial assets and liabilities.
Remaining contractual maturities
The following tables detail the Group's remaining contractual maturity for its financial instrument liabilities. The tables have
been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the
financial liabilities are required to be paid. The tables include both interest and principal cash flows disclosed as remaining
contractual maturities and therefore these totals may differ from their carrying amount in the statement of financial position.
Consolidated - 2020
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Interest-bearing - fixed rate
Shareholder loans
Shareholder loans interest
Total non-derivatives
Consolidated - 2019
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Total non-derivatives
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years Over 5 years
$
$
249,183
177,904
750,000
2,466
1,179,553
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1 year or less
$
Between 1
and 2 years
$
Between 2
and 5 years Over 5 years
$
$
Remaining
contractual
maturities
$
249,183
177,904
750,000
2,466
1,179,553
Remaining
contractual
maturities
$
117,330
75,843
193,173
-
-
-
-
-
-
-
-
-
117,330
75,843
193,173
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
41
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 21. Fair value measurement
The carrying amounts of trade and other receivables and trade and other payables are assumed to approximate their fair
values due to their short-term nature.
The fair value of financial liabilities is estimated by discounting the remaining contractual maturities at the current market
interest rate that is available for similar financial liabilities.
Note 22. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the Group is set out
below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Note 23. Remuneration of auditors
Consolidated
2020
$
2019
$
642,922
49,312
12,937
41,065
688,415
69,527
16,742
266,199
746,236
1,040,883
During the financial year the following fees were paid or payable for services provided by Grant Thornton Audit Pty Ltd, the
auditor of the Company:
Audit services - Grant Thornton Audit Pty Ltd
Audit or review of the financial statements
Other services - Grant Thornton Audit Pty Ltd
Non-audit services
Note 24. Contingent liabilities
The Group had no material contingent liabilities at 30 June 2020 or 30 June 2019.
Consolidated
2020
$
2019
$
98,350
80,275
5,000
5,000
103,350
85,275
42
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 25. Commitments
Lease commitments - operating
Committed at the reporting date but not recognised as liabilities, payable:
Within one year
Consolidated
2020
$
2019
$
-
26,675
AASB 16 was adopted using the modified retrospective approach from 1 July 2019. Comparative year leases disclosed
above were required under the superseded leasing standard, AASB 117.
Note 26. Related party transactions
Parent entity
Integrated Payment Technologies Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 28.
Key management personnel
Disclosures relating to key management personnel are set out in note 22 and the remuneration report included in the
directors' report.
Transactions with related parties
There were no transactions with related parties during the current and previous financial year.
Receivable from and payable to related parties
There were no trade receivables from or trade payables to related parties at the current and previous reporting date.
Loans to/from related parties
The following balances are outstanding at the reporting date in relation to loans with related parties:
Current borrowings:
Shareholder loans
Consolidated
2020
$
2019
$
750,000
-
Terms and conditions
Shareholder loans mature after 12 months from the date of issue (30 October 2019). Interest accrues at the rate of 8% per
annum. These loans were subsequently paid on 15 July 2020 after completion of the entitlement offer on issue of new
ordinary shares of the Company.
All transactions were made on normal commercial terms and conditions and at market rates.
43
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 27. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Loss after income tax
Total comprehensive income
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Share option reserve
Accumulated losses
Total equity
Parent
2020
$
2019
$
(3,666,012)
(10,543,717)
(3,666,012)
(10,543,717)
Parent
2020
$
2019
$
1,010,512
1,598,959
3,343,788
5,605,325
1,144,704
273,772
1,212,368
972,368
22,690,408
74,775
(20,633,763)
21,600,708
674,952
(17,642,703)
2,131,420
4,632,957
Guarantees entered into by the parent entity in relation to the debts of its subsidiaries
The parent entity had no guarantees in relation to the debts of its subsidiaries as at 30 June 2020 and 30 June 2019.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2020 and 30 June 2019.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2020 and 30 June 2019.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the Group, as disclosed in note 2, except for the
following:
●
●
Investments in subsidiaries are accounted for at cost, less any impairment, in the parent entity.
Dividends received from subsidiaries are recognised as other income by the parent entity and its receipt may be an
indicator of an impairment of the investment.
44
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 28. Interests in subsidiaries
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in
accordance with the accounting policy described in note 2:
Name
ClickSuper Pty Ltd
Jagwood Pty Ltd
Payment Adviser Pty Ltd
Principal place of business /
Country of incorporation
Australia
Australia
Australia
Ownership interest
2019
2020
%
%
100%
100%
100%
100%
100%
100%
Note 29. Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax (expense)/benefit for the year
(3,666,012)
(13,022,078)
Consolidated
2020
$
2019
$
Adjustments for:
Depreciation and amortisation
Impairment of goodwill and other intangible assets
Impairment of receivables
Share-based payments
Share issues transaction costs
Change in operating assets and liabilities:
Decrease/(increase) in trade and other receivables
Decrease in deferred tax assets
Increase in trade and other payables
Decrease in deferred r&d government grant
Decrease in deferred tax liabilities
Increase in employee benefits
Net cash used in operating activities
Note 30. Changes in liabilities arising from financing activities
Consolidated
Balance at 1 July 2018
Balance at 30 June 2019
Net cash from financing activities
Balance at 30 June 2020
45
1,848,327
-
49,880
74,775
12,140
2,070,404
9,667,694
-
61,823
-
(31,708)
281,798
237,510
(67,664)
(281,798)
68,691
279,591
328,972
85,243
(67,663)
(281,798)
54,029
(1,474,061)
(823,783)
Shareholder
loans
$
-
-
750,000
750,000
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 31. Earnings per share
Consolidated
2020
$
2019
$
Loss after income tax attributable to the owners of Integrated Payment Technologies Limited
(3,666,012)
(13,022,078)
Weighted average number of ordinary shares used in calculating basic earnings per share
310,733,740
178,522,085
Weighted average number of ordinary shares used in calculating diluted earnings per share
310,733,740
178,522,085
Number
Number
Basic earnings per share
Diluted earnings per share
Cents
Cents
(1.180)
(1.180)
(7.294)
(7.294)
20,000,000 (2019: 5,000,000) share options deemed to be issued for no consideration in respect of share based
payments have been excluded from the above calculation for diluted earnings per share at 30 June 2020 as their inclusion
would be anti-dilutive due to the loss for the year.
Note 32. Share-based payments
Employee Share Option Plan
Option Plan Rules
The Board approved the Integrated Payment Technologies Limited Employee Share Option Plan ('ESOP' or 'Plan') on 18
August 2016. The Plan is governed by the Plan rules ('Plan Rules'), a summary of which is set out below.
Persons eligible to participate in the Plan are full-time or part-time employees (including executive directors), non-executive
directors and contractors and casual employees of the Group who satisfy various conditions set out in the Plan ('Eligible
Persons').
The Plan was established to enable the Group to retain and attract skilled and experienced employees, contractors and
directors and provide them with the motivation to make the Group more successful. The Plan is designed to support
interdependence between the Company and Eligible Persons for their long-term mutual benefit.
Under the Plan, unless otherwise determined by the Board, no payment is required for the grant of options under the Plan.
An offer by the Board shall specify the terms and conditions of the grant at its discretion. An Eligible Person may renounce
an offer under the Plan in favour of a permitted nominee. Options granted under the Plan may not otherwise be transferred
or encumbered by a participant, unless the Board determines otherwise.
Options do not carry any voting or dividend rights. Shares issued or transferred to participants on exercise of an option
carry the same rights and entitlements as other issued shares, including dividend and voting rights.
An option may be exercised, whether or not any or all applicable exercise conditions have been met, on the occurrence of
a predominant control event, being, in general terms, where a person becomes owner of at least 90% of the issued
ordinary share capital of the Company following an offer by the person for the whole of the issued share capital of the
Company.
At its discretion, the Company will apply to ASX for official quotation of shares issued upon exercise of options granted
under the Plan as long as the shares are quoted on the Official List of ASX at that time.
The Company may financially assist a person to pay any exercise price for an option, subject to compliance with the
provisions of the Corporations Act 2001 and the ASX Listing Rules relating to financial assistance.
46
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 32. Share-based payments (continued)
If a participant ceases to be a director, an employee or a contractor of any member of the Group due to his or her
resignation, dismissal for cause or poor performance or in any other circumstances determined by the Board, vested
options held by the participant will automatically lapse on the date of cessation, unless the Board determines otherwise. All
unvested options will lapse at the date of cessation.
If a Participant ceases to be a director, an employee or a contractor of any member of the Group for any other reason or in
any other circumstances determined by the Board, vested options may be exercised by that participant in the 6 month
period following the date of cessation after which those vested options will immediately lapse. All unvested options will
lapse at the date of cessation.
If, in the opinion of the Board, a participant has acted fraudulently or dishonestly, the Board may determine that any option
granted to that participant should lapse, and the option will lapse accordingly.
If the Company or any member of the Group has an obligation in relation to a tax liability associated with the grant or
vesting of any option ('Tax Liability'), then the Company may sell a sufficient number of shares, post vesting or exercise of
the option, to cover the Tax Liability. A participant may enter into alternative arrangements, if acceptable to the Board, to
settle any Tax Liability.
In the event of any reconstruction of the share capital of the Company, pro rata issue, or bonus issue of shares, the
number of options to which each participant is entitled and/or the exercise price of those options (as relevant) will be
adjusted accordingly pursuant to the Plan.
The Board may terminate or suspend the operation of the Plan at any time. In passing a resolution to terminate or suspend
the operation of the Plan or to supplement or amend these rules, the Board must consider and endeavour to ensure that
there is fair and equitable treatment of all participants. On termination of the Plan, no compensation under any contract of
employment, consultancy or directorship between an Eligible Person and a member of the Group will arise as a result.
Set out below are summaries of options granted under the Plan:
2020
Grant date
Expiry date
Exercise
price
Balance at
the start of
the year
Granted
Exercised
14/12/2016
31/07/2019
14/12/2020
31/07/2022
$0.1958
$0.0335
5,000,000
-
5,000,000
-
15,000,000
15,000,000
2019
Grant date
Expiry date
Exercise
price
14/12/2016
14/12/2020
$0.1958
Balance at
the start of
the year
7,500,000
7,500,000
Granted
Exercised
-
-
The weighted average share price during the financial year was $0.07 (2019: $0.10).
Expired/
forfeited/
other
Balance at
the end of
the year
(5,000,000)
-
(5,000,000)
-
15,000,000
15,000,000
Expired/
forfeited/
other
Balance at
the end of
the year
(2,500,000)
(2,500,000)
5,000,000
5,000,000
-
-
-
-
-
The weighted average remaining contractual life of options outstanding at the end of the financial year was 1.7 years
(2019: 1.5 years).
For the options granted during the current financial year, the valuation model inputs used to determine the fair value at the
grant date, are as follows:
Grant date
Expiry date
Share price
at grant date
Exercise
price
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant date
31/07/2019
31/07/2022
$0.1958
$0.0350
192.40%
-
1.00%
$0.026
47
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 32. Share-based payments (continued)
Terms and conditions of option grants
Options granted under the Employee Share Option Plan Scheme
Grant date:
Number of options:
Exercise price:
31 July 2019
15,000,000 options
exercise price is 3.5 cents ($0.035) per option (reduced to $.0335 per option following the
Company's entitlement offer effective 31 July 2020); with the holder given the following
choice:
(i)exercise the options in the traditional manner, in which case, pay the exercise price an
receive 1 ordinary share for each option exercised; or
(ii)elect a cashless exercise alternative, in which case, the Company will only issue the
number of ordinary shares as are equal in value to the positive difference between the
exercise price otherwise payable for the options and the market value of the shares at the
time of exercise (determined as the volume weighted average market price of the
Company's shares sold on the ASX on the 5 business days immediately prior to the
exercise date).
option vests 12 months from the date of the grant of the options if:
(i) the market price of the ordinary share in the Company is at least $0.035; and
(ii) the relevant employee remains in employment with the Company or its subsidiaries; and
exercise period ends 3 years after the date of grant of the options.
Vesting date:
Exercise period:
These 15,000,000 options lapsed in July 2020 as the vesting conditions were not met.
The terms and conditions on which the options granted to Robin Beauchamp are set out below:
Grant Date:
Number of options:
Exercise Price:
14 December 2016 (the 'Grant Date').
5,000,000 options to Robin Beauchamp, separated into three equal tranches.
20 cents per option (reduced to $0.1958 per option following the Company's entitlement
offer effective 31 May 2019), as determined in accordance with the Plan Rules.
As identified below for each respective tranche of options.
Begins on the relevant Vesting Date for each respective tranche of options (identified
below) and ends four years after the Grant Date (as amended in accordance with the Plan
Rules).
As set out below for each respective tranche of options.
As identified in the Plan Rules.
Vesting Dates:
Exercise Period:
Exercise Conditions:
Forfeiture Conditions:
Tranche 1
Proportion of options - 33.3% of aggregate number of options
Vesting dates - The Tranche 1 options will vest on the date that the Exercise Conditions for the Tranche 1 options are
satisfied or are waived by the Board.
Exercise conditions - The Exercise Conditions for the Tranche 1 options are satisfaction of both the following:
(a) commencement of official quotation of the Company’s ordinary shares on ASX; and
(b) achievement of any one of the following:
(i) the Market Share Price (being the volume weighted average market price of Shares sold on ASX on the 10 trading days
immediately before the determination date) ('Market Share Price') of an ordinary share in the Company is equal to or
greater than A$0.30 calculated as at the determination date of 30 June 2017; or
(ii) the Market Share Price of an ordinary share in the Company is equal to or greater than A$0.40 calculated as at the
determination date of 30 June 2018; or
(iii) the Market Share Price of an ordinary share in the Company is equal to or greater than A$0.50 calculated as at the
determination date of 30 June 2019.
48
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 32. Share-based payments (continued)
Tranche 2
Proportion of options - 33.3% of aggregate number of options
Vesting dates - The Tranche 2 options will vest on the date that the Exercise Conditions for the Tranche 2 options are
satisfied or are waived by the Board.
Exercise conditions - The Exercise Conditions for the Tranche 2 options are satisfaction of both the following:
(a) commencement of official quotation of the Company’s ordinary shares on ASX; and
(b) achievement of any one of the following:
(i) the Market Share Price of an ordinary share in the Company is equal to or greater than A$0.40 calculated as at the
determination date of 30 June 2018; or
(ii) the Market Share Price of an ordinary share in the Company is equal to or greater than A$0.50 calculated as at the
determination date of 30 June 2019.
Tranche 3
Proportion of options - 33.3% of aggregate number of options
Vesting dates - The Tranche 3 options will vest on the date that the Exercise Conditions for the Tranche 3 options are
satisfied or are waived by the Board.
Exercise conditions - The Exercise Conditions for the Tranche 3 options are satisfaction of both the following:
(a) commencement of official quotation of the Company’s ordinary shares on ASX; and
(b) the Market Share Price of an ordinary share in the Company is equal to or greater than A$0.50 calculated as at the
determination date of 30 June 2019.
These 5,000,000 options lapsed on 10 July 2020 due to the cessation of employment of the option holder.
Note 33. Events after the reporting period
Acquisition of BizIntergration
The proposed acquisition of BizIntegration was announced to the ASX on 16 June 2020. As part of the Company’s due
diligence, an extensive investigation and confirmation of the Intellectual Property (IP) rights of Biz Integration Pty Ltd was
undertaken by InPayTech’s IP attorney. It was subsequently agreed by all parties for InPayTech to acquire TipsGo Pty Ltd
to gain full IP rights to the platform. Although TipsGo is currently a non-operating business, the InPayTech directors believe
the IP held by TipsGo is of value to InPayTech’s growth strategy.
The acquisition terms provide for:
●
●
●
●
●
a payment of $30,000 (plus GST) to be made to Biz Integration Pty Ltd for work undertaken in supplying, loading and
testing the TipsGo platform on InPayTech’s infrastructure on completion of the acquisition;
the issue of 33,000,000 fully paid ordinary shares by InPayTech to the TipsGo shareholder as consideration shares
on completion of the acquisition;
the issue of 3,000,000 fully paid ordinary shares by InPayTech to a third party associated with TipsGo for the
assignment of their IP rights to TipsGo as consideration shares on completion of the acquisition;
the issue of such shares by InPayTech is conditional upon approval of InPayTech shareholders (with a general
meeting planned for October 2020); and
shares issued by InPayTech will be subject to a 12 month voluntary escrow agreement. The acquisition terms provide
for the proposed completion of the acquisition following shareholder approval by InPayTech shareholders.
The director of TipsGo, who is a co-inventor of InPayTech’s payment patents, has agreed to provide up to 10 hours of
consulting time per month until 31 December 2021, at no cost until InPayTech is cash flow positive, including periodically
reviewing the technical architecture of InPayTech and the integration of the TipsGo platform into the ClickSuper service.
The integration of TipsGo’s 140+ Application Programming Interfaces (APIs), covering topics such as payments, cash flow
analysis, financial calculators, budgeting, product comparators and more, powered with rich payroll data from ClickSuper’s
growing integrated payroll network, is expected to reposition ClickSuper as the proposed digital engagement solution,
ClickVu.
49
Integrated Payment Technologies Limited
Notes to the financial statements
30 June 2020
Note 33. Events after the reporting period (continued)
Australian Patent
The delegate of the Commissioner of Patents at IP Australia has issued a decision in favour of granting our patent
application. The Australian patent is expected to be granted by the end of the year, or early in 2021.
If granted as expected, this will be the eighth patent for InPayTech across the globe. Other patents in the western world
include the United States, South Africa and New Zealand. InPayTech has also patented its payments process in Asia
including China, Japan, Hong Kong and Singapore. The Group also has a patent pending in Canada.
If granted as expected, the Australian patent will be a significant milestone for InPayTech. We believe our unique and novel
technology makes payment processing more efficient while simultaneously making it easier to meet increasing compliance
obligations.
Capital raising
On 8 July 2020, the Company issued 125,546,123 ordinary shares as part of the 1 for 2 non-renounceable Entitlement
Offer raising a total of $1,883,192.
On 15 July 2020, the Company issued the remaining shortfall shares under the 1 for 2 non-renounceable Entitlement Offer
raising additional $433,110.
Shareholder loans
On 15 July 2020, the Group paid all the shareholder loans totalling $750,000 and is now debt free.
COVID-19
The impact of COVID-19 pandemic is ongoing and it is not practicable to estimate the potential impact, positive or
negative, after the reporting date. The situation is rapidly developing and is dependent on measures imposed by the
Australian Government and other countries, such as maintaining social distancing requirements, quarantine, travel
restrictions and any economic stimulus that may be provided.
No other matter or circumstance has arisen since 30 June 2020 that has significantly affected, or may significantly affect
the Group's operations, the results of those operations, or the Group's state of affairs in future financial years.
50
Integrated Payment Technologies Limited
Directors' declaration
30 June 2020
In the directors' opinion:
●
●
●
●
the attached financial statements and notes comply with the Corporations Act 2001, the Accounting Standards, the
Corporations Regulations 2001 and other mandatory professional reporting requirements;
the attached financial statements and notes comply with International Financial Reporting Standards as issued by the
International Accounting Standards Board as described in note 2 to the financial statements;
the attached financial statements and notes give a true and fair view of the Group's financial position as at 30 June
2020 and of its performance for the financial year ended on that date; and
there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due
and payable.
The directors have been given the declarations required by section 295A of the Corporations Act 2001.
Signed in accordance with a resolution of directors made pursuant to section 295(5)(a) of the Corporations Act 2001.
On behalf of the directors
___________________________
Don Sharp
Executive Chairman
26 August 2020
Sydney
51
Level 17, 383 Kent Street
Sydney NSW 2000
Correspondence to:
Locked Bag Q800
QVB Post Office
Sydney NSW 1230
T +61 2 8297 2400
F +61 2 9299 4445
E info.nsw@au.gt.com
W www.grantthornton.com.au
Independent Auditor’s Report
To the Members of Integrated Payment Technologies Limited
Report on the audit of the financial report
Opinion
We have audited the financial report of Integrated Payment Technologies Limited (the Company) and its subsidiaries (the
Group), which comprises the consolidated statement of financial position as at 30 June 2020, the consolidated statement
of profit or loss and other comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended, and notes to the consolidated financial statements, including a summary
of significant accounting policies, and the Directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act 2001, including:
a giving a true and fair view of the Group’s financial position as at 30 June 2020 and of its performance for the year
ended on that date; and
b complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are
further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are
independent of the Group in accordance with the auditor independence requirements of the Corporations Act 2001 and
the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for
Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled
our other ethical responsibilities in accordance with the Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Grant Thornton Audit Pty Ltd ACN 130 913 594
a subsidiary or related entity of Grant Thornton Australia Ltd ABN 41 127 556 389
www.grantthornton.com.au
‘Grant Thornton’ refers to the brand under which the Grant Thornton member firms provide assurance, tax and advisory services to their clients
and/or refers to one or more member firms, as the context requires. Grant Thornton Australia Ltd is a member firm of Grant Thornton International
Ltd (GTIL). GTIL and the member firms are not a worldwide partnership. GTIL and each member firm is a separate legal entity. Services are
delivered by the member firms. GTIL does not provide services to clients. GTIL and its member firms are not agents of, and do not obligate one
another and are not liable for one another’s acts or omissions. In the Australian context only, the use of the term ‘Grant Thornton’ may refer to
Grant Thornton Australia Limited ABN 41 127 556 389 and its Australian subsidiaries and related entities. GTIL is not an Australian related entity to
Grant Thornton Australia Limited.
Liability limited by a scheme approved under Professional Standards Legislation.
52
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
report of the current period. These matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined the matters described below to be the key audit matters to be communicated in our report.
Key audit matter
How our audit addressed the key audit matter
Capitalisation of software development costs – refer to
Note 12. Non-current assets – intangibles
The Group has continued to capitalise development costs
associated with the internally developed software.
The Group’s processes for calculating the value of internally
developed software involves judgement as it includes
estimating the time which staff spend developing software and
determining the value attributable to that time.
Due to the judgement involved in calculating whether costs
can be capitalised under AASB 138 Intangible Assets, we
have determined this as a Key Audit Matter.
Impairment testing of intangible assets – refer to Note 12.
Non-current assets – intangibles
The Group has recognised intangible assets from a prior
business combination and continues to capitalise software
development costs.
All assets must be assessed at each reporting date for any
indication of impairment. Goodwill and intangibles not yet
available for use must be tested annually for impairment
regardless of whether any indication of impairment exists.
The Group has utilised the fair value less cost of disposal
method to estimate the recoverable amount of intangible
assets. This method involved the preparation of a valuation
model that incorporated a number of unobservable inputs.
Due to the significant estimation involved in estimating the
recoverable amount, and the use of unobservable inputs, we
have determined this as a Key Audit Matter.
Our procedures included, amongst others:
assessed the Group’s accounting policy for software
development costs for adherence to AASB 138;
agreed a sample of capitalised expenditure, through to
support documentation such as internal salary costs and
external contractor invoices and assessed those amounts
against the recognition criteria of AASB 138;
assessed the consistency of the capitalisation methodology
applied by the Group in comparison to the prior reporting
period;
considered the reasonableness of useful lives applied to
amortise intangible assets; and
assessed the adequacy of disclosures included in the
financial report for adherence to AASB 138.
Our procedures included, amongst others:
reviewed management’s valuation methodology;
assessed management’s determination of the Group’s
Cash Generating Units (CGU) based on our
understanding of how management monitors the entity's
operations and makes decisions about groups of assets
that generate independent cash flows;
reviewed the impairment model for compliance with AASB
136 Impairment of Assets;
verified the mathematical accuracy of the underlying
model calculations and assessed the appropriateness of
the methodologies;
evaluated the cash flow projections and the process by
which they were developed;
performed sensitivity over key assumptions in the model;
53
Key audit matter
How our audit addressed the key audit matter
Going Concern – refer to Note 2. Going Concern
The group recorded a loss before income tax of $3,671,857,
net cash outflows from investing activities of $822,785 and net
cash outflows from operating activities of $1,474,061.
Management’s assessment of the going concern basis of
accounting is based on cash flow projections. The preparation
of these projections incorporated a number of assumptions
and judgments.
The Group’s use of the going concern basis of accounting and
the associated extent of uncertainty is a key audit matter due
to the high level of judgment required in evaluating the
Group’s assessment of going concern
evaluated for indicators of management bias throughout
our evaluation of the key inputs and assumptions of the
estimate;
consulted with our valuation expert to evaluate the model
and key inputs; and
assessed the adequacy of financial report disclosures on
the application of judgement in estimating future cash
flows and the key methods and assumptions used in the
impairment assessment.
Our procedures included, amongst others:
obtained and reviewed management’s cash flow forecast
to assess whether current cash levels can sustain
operations for a period of at least 12 months from the
proposed date of signing the financial statements;
agreed year end cash balances to third party independent
confirmations received to gain comfort around the
opening balances used in the cash flow forecast;
agreed the receipt of cash from the entitlement offer and
considered its effect on forecasted cash levels;
assessed the Group’s current level of income and
expenditure against management’s forecast for
consistency of relationships and trends to the historical
results, and results since year end; and
assessed the adequacy of the related disclosures within
the financial report.
Information other than the financial report and auditor’s report thereon
The Directors are responsible for the other information. The other information comprises the information included in the
Group’s annual report for the year ended 30 June 2020, but does not include the financial report and our auditor’s report
thereon.
Our opinion on the financial report does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or
otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
54
Responsibilities of the Directors for the financial report
The Directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in
accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal control as the Directors
determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material
misstatement, whether due to fraud or error.
In preparing the financial report, the Directors are responsible for assessing the Group’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Group or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of this financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance
Standards Board website at: https://www.auasb.gov.au/auditors_responsibilites/ar1_2020.pdf. This description forms part of
our auditor’s report.
Report on the remuneration report
Opinion on the remuneration report
We have audited the Remuneration Report included in the Directors’ report for the year ended 30 June 2020.
In our opinion, the Remuneration Report of Integrated Payment Technologies, for the year ended 30 June 2020 complies
with section 300A of the Corporations Act 2001.
Responsibilities
The Directors of the Company are responsible for the preparation and presentation of the Remuneration Report in accordance
with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on the Remuneration Report,
based on our audit conducted in accordance with Australian Auditing Standards.
Grant Thornton Audit Pty Ltd
Chartered Accountants
M R Leivesley
Partner – Audit & Assurance
Sydney, 26 August 2020
55
Integrated Payment Technologies Limited
Shareholder information
30 June 2020
The shareholder information set out below was applicable as at 19 August 2020.
Distribution of shareholders
1 to 1,000
1,001 to 5,000
5,001 to 10,000
10,001 to 100,000
100,001 and over
Holding less than a marketable parcel
Equity security holders
Total
number
securities
Number
of security
holders
%
17
8
27
700
465
5,851
17,778
242,809
33,987,928
506,006,081
1,217
540,260,447
91
-
-
-
-
6
94
100
-
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
VALEBARK PTY LTD (SCULLY INVESTMENT TRUST)
S & F FINANCIAL SERVICES PTY LTD
STARMAY SUPERANNUATION PTY LTD (STARMAY SFUND COLIN SCULLY AC)
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
VALEBARK PTY LTD (THE SCULLY INVESTMENT TRUST)
PARMMS ENTERPRISES PTY LTD (PARMMS INVESTMENT TRUST A/C)
COMSEC NOMINEES PTY LIMITED
STARMAY SUPERANNUATION PTY LTD (STARMAY SFUND DON SHARP PENSION AC)
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
PARMMS ENTERPRISES PTY LTD (COLLINS FAMILY SUPERANNUATION FUND)
PT MORAN PTY LTD (PT MORAN SUPERANNUATION FUND A/C)
SAUT PTY LTD (SA UNIT TRUST)
10 BOLIVIANOS PTY LTD
ADELROSE PTY LTD (JUDD SUPER FUND A/C)
THE TONG FAMILY PTY LTD (TONG FAMILY SUPERFUND A/C)
STARTRADE PTY LTD (STAR INVESTMENT A/C)
MISS XINGLIANG LIN
MS CHUNYAN NIU
VALEBARK PTY LTD (SCULLY INVESTMENT A/C)
TWD CO PTY LIMITED (R & R SUPERANNUATION FUND)
Unquoted equity securities
There are no unquoted equity securities.
Ordinary shares
Number held
% of total
shares
issued
58,525,152
33,333,334
32,859,000
23,298,040
16,975,002
16,666,667
15,129,070
12,648,245
12,545,786
12,533,333
10,350,000
10,000,000
8,056,510
6,750,000
6,101,786
5,106,206
5,066,520
4,980,000
4,302,372
4,085,200
299,312,223
10.83
6.17
6.08
4.31
3.14
3.08
2.80
2.34
2.32
2.32
1.92
1.85
1.49
1.25
1.13
0.95
0.94
0.92
0.80
0.76
55.40
56
Integrated Payment Technologies Limited
Shareholder information
30 June 2020
Substantial holders
Set out below are the names of substantial holders in the Company and the number of equity securities in which each
substantial holder and the substantial holder’s associates have a relevant interest, as disclosed in substantial holding
notices given to the Company:
Donald Sharp, Donald Financial Enterprises Pty Ltd and S&F Financial Services Pty Ltd
Colin Scully and Valebark Pty Ltd
Starmay Superannuation Pty Ltd
Parmms Enterprises Pty Ltd and Paul Collins
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
Number held
101,717,177
139,529,435
59,726,909
42,083,374
% of total
shares
issued
18.83
25.83
11.06
7.79
Ordinary shares
On a show of hands every member present at a meeting in person or by proxy shall have one vote and upon a poll each
share shall have one vote.
There are no other classes of equity securities with voting rights.
The unquoted options do not have voting rights.
Use of cash
The Company was admitted under ASX Listing Rule 1.3.2(b).
The Company, during the reporting period, used the cash and assets in a form readily convertible to cash that it had at
admission to the official list of the ASX in a way consistent with its business objectives.
General
There is no current on-market buy-back for the Company’s securities.
There have been no issues of securities approved for the purposes of Item 7 of section 611 of the Corporations Act 2001
(Cth) which have not yet been completed.
No securities were purchased on-market during the reporting period under or for the purposes of an employee incentive
scheme or to satisfy the entitlements of the holders of options or other rights to acquire securities granted under an
employee incentive scheme.
57
Integrated Payment Technologies Limited
Corporate directory
30 June 2020
Directors
Donald ('Don') Sharp - Executive Chairman
Paul Collins - Non-Executive Director
Sandra Barns - Non-Executive Director
Company secretary
Jillian McGregor
Registered office
Share register
Auditor
Solicitors
Suite 1, Level 5
28 Margaret Street
Sydney NSW 2000
Tel: +61 2 8090 1130
Registry Direct
Level 6
2 Russell Street
Melbourne VIC 3000
Tel: 1300 556 635 (within Australia)
Tel: +61 3 9909 9909 (outside Australia)
Grant Thornton Audit Pty Ltd
Level 17
383 Kent Street
Sydney NSW 2000
Coleman Greig Lawyers
Level 11
100 George Street
Parramatta NSW 2150
Stock exchange listing
Integrated Payment Technologies Limited shares are listed on the Australian
Securities Exchange (ASX code: IP1)
Website
www.inpaytech.com.au
Business objectives
Integrated Payment Technologies Limited has used cash and assets in a form readily
convertible to cash that it had at the time of admission in a way consistent with its
business objectives.
Corporate Governance Statement
The Corporate Governance Statement which is approved at the same time as the
Annual Report can be found at:
https://inpaytech.com.au/corporate-governance-statement/
58
ACN. 611 202 414
Level 5, 28 Margaret Street
Sydney, NSW 2000
Telephone: 1300 834 535
Fax: 02 8090 1139
Email: info@inpaytech.com.au
Website: www.inpaytech.com.au