Kyckr Limited
Contents
30 June 2019
Chairman's and Chief Executive Officer's report
Corporate directory
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 Kyckr Limited
Shareholder information
2
8
9
24
25
26
27
28
29
60
61
64
1
Non-Executive Chairman and CEO
Report
BENNY HIGGINS
Non-Executive
Chairman of the Board
IAN HENDERSON
Chief Executive Officer
Dear shareholders,
On behalf of the Board of Kyckr Limited (Kyckr or the
Company), it is my pleasure to present the annual
report for the year ended 30 June 2019.
This past year has been a year of evolution for Kyckr
with the appointment of Mr Ian Henderson as new
CEO and with the launch of the new Kyckr.com
platform, in conjunction with the Company’s
expansion across several key areas to strengthen its
customer value proposition.
This past year
has been a
year of
evolution for
Kyckr.
Building on the rapid growth of KYC in the
global RegTech Industry
This is an exciting time for Kyckr as Know-Your-
Customer (KYC) and Anti-Money-Laundering (AML)
efforts are rapidly increasing, with a twenty-fold
surge in suspicious activity reporting between 2012
and 2017.
2
Regulators are encouraging the industry to
embrace emerging technologies and analytics
to improve KYC and AML policies, recognising
the necessity of automation for an adequate
compliance regime, including automated
identity verification during the customer
onboarding process.
Kyckr’s Know-Your-Customer technology helps
solve this, providing companies with real time
access to data to verify the identity of their
customers and enable users to instantly find
company profiles, credit reports and fillings to
meet regulatory requirements and prevent
financial crime.
Kyckr is confident growth will accelerate on the
back of increased compliance requiring legally
authoritative information direct from registries,
which can be found through its single source
platform for customer identification, accessing
real time data from over 200 registries in 120
countries.
Financial Overview
Kyckr delivered revenue of $2.14 million for
FY19 across our range of B2C online, post-
billed online sales and enterprise solutions.
This represents an increase of more than 25%
over the full prior year.
Online sales revenue grew 45% to $1.49 million
in FY19 across B2C and post-billed Kyckr
platforms. Enterprise revenue for the year is
$0.65m, a decrease of 7% on the previous
corresponding period.
To improve enterprise revenue growth in FY20,
Kyckr is focussing on collaborating with firms
across the financial, data and technology
space, to leverage on its expertise and unique
access to real-time registry data.
Together with our online strategy, we look to
continue our forward momentum and
collaborate exclusively with firms looking to
transform the quality of their data and
accelerate the development of automation onto
their clients and suppliers.
Financial Highlights
REVENUE FOR FY19
ONLINE REVENUE
25%
ON FY18
45%
ON FY18
3
Our Achievements
$5.2 million raised via a share placement
Kyckr announced the successful completion of
a Placement from new and existing institutional
and private investors to raise A$5.2 million
(before costs). The Placement occurred via a
two tranche Placement, with the second
tranche approved at the extraordinary general
meeting (EGM) held in September 2019.
As Kyckr continues to scale up, the proceeds
from the Placement will be used to accelerate
the Company’s global commercialisation
activities and will be applied towards additional
resources (Business Development and Account
Management), continued investment of Kyckr’s
products and general working capital purposes.
Kyckr signs agreement with global data
platform provider DemystData
Kyckr announced that it has signed a 2-year
data provider agreement with global data
platform DemystData.
DemystData are a leading provider and
platform for integrating data, providing financial
institutions with API access to discover, access
and test corporate data in combatting fraud,
strengthening compliance and reducing data
managements costs.
Founded in 2010 and with offices in New York,
Singapore, Hong-Kong and Melbourne, Demyst
has over 30 clients, including tier-one banks,
insurers, and lenders across the US and Asia
Pacific.
This agreement will allow the Kyckr API to be
accessible by existing and future Demyst API
customers.
The addition of Kyckr’s API will help Demyst
customers seamlessly evaluate, test and use
the Kyckr network of real-time registry
information via the Demyst platform. The
platform allows customers to test the data in a
secure sandbox environment and helps reduce
both onboarding times and cost.
Additionally, Demyst will market the addition of
the Kyckr API to their existing customer base,
promoting Kyckr’s automation expertise to
further financial institutions globally.
Strengthened executive team to drive the
business
The management team was strengthened
during the year with senior hires including Ian
Henderson joining as Chief Executive Officer
(CEO) of Kyckr from 1 January 2019. Ian brings
more than 30 years of financial services and
banking experience, having held the roles of
former CEO of RBS International and of UK-
based Shawbrook Bank where he drove both
companies’ profitability during his tenure.
The Board and I are confident that Ian’s proven
track record in growing businesses will be
integral to leading the commercialisation of
Kyckr’s Know-Your-Customer solutions. Ian is
based in London in proximity to the Company’s
key markets in the main global financial hubs.
Launch of improved digital platform to
accelerate online growth
In May, we announced the much anticipated
launch of our new digital platform
www.kyckr.com to provide an improved user
experience and functionality for customers.
The Kyckr online platform is one of the largest
KYC platforms for customer identification
worldwide.
The platform has experienced rapid growth in
new registrations in the last twelve months
4
with online revenue increasing consistently
year on year, up 41% in FY19 compared to
FY18.
KYCKR ONLINE REGISTRATIONS
41%
IN FY19 COMPARED TO FY18
Powered by Microsoft Azure technology, the
Kyckr.com platform debuts an all-new mobile
responsive design centred around client needs
and behaviours, with quick search dropdowns,
improved administration features, dashboard
functionality and increased information on our
range of compliance solutions. The launch of
the new platform has already been well
received by users, capturing positive feedback
and showing strong subscriber growth.
The platform plays a key role in supporting our
plans to increase leads, users and sales and we
expect strong revenue growth from this
channel.
The Kyckr online
platform is one of
the largest KYC
platforms for
customer
identification
worldwide.
Focus on establishing strategic partnerships
with global data providers
Under the new leadership team, Kyckr’s
strategy is to grow strategic partnerships with
firms across the financial, data and technology
sectors who are looking to accelerate the
development of automation for their clients and
suppliers and embed Kyckr’s unique registry
network. We see strategic partnerships as a
natural, progressive step in capitalising on
Kyckr’s breadth of technologies and real-time
global data. As a result, the Company has been
in discussions with a number of global data
providers to collaborate together and create
new revenue streams. illion to resell Kyckr’s
real-time, global registry data solutions to new
and existing clients in Australian and New
Zealand. We will continue to explore additional
opportunities to forge these partnerships in the
future.
New agreement to provide data to ESC
Discussions with strategic partners have
resulted in a collaboration agreement with ESC
Corporate Services Ltd (ESC). ESC is a leading
facilitator of corporate legal and public records
search/registration services to over 8,000
banks, law firms, fin-techs, and institutions
across Canada. ESC delivers solutions uniting
public record data, customer authentication
and collateral management services to support
the lending practices of clients with businesses
across Canada.
The three-year agreement enables ESC to
access US data from the Kyckr global registry
network. Kyckr will commence services
immediately and we will work with ESC to
identify opportunities to generate uptake of our
range of solutions for ESC and its client base.
5
Enterprise client Bank of Ireland extends
service for three years
legal, compliance and corporate governance in
Europe and Asia-Pacific.
We continue to commercialise our
relationships with key customers and during
the period we announced the extension of
services to leading Irish bank, Bank of Ireland,
for a period of three years to September 2021.
The agreement is for a minimum contractual
commitment of A$660k (€405k) over the period
to provide Corporate Know-Your-Customer Due
Diligence Services.
Bank of Ireland has been an early adopter and
enterprise client of Kyckr since 2015 and the
new agreement is a validation of Kyckr’s
technology by a blue-chip client.
Kyckr’s offering continues to be used by a
diversified range of blue-chip clients including
Bloomberg, Citigroup, IBM and Bank of Ireland.
Expertise grows with appointment of Non-
Executive Directors
During the year we also strengthened our Board
with the appointment of senior compliance
executives Ms Jacqueline Kilgour and Ms
Karina Kwan as Non-Executive Directors.
Ms Kilgour brings more than 30 years’ financial
services experience in regulatory compliance,
risk management, anti-money laundering (AML)
and corporate governance matters. She has
successfully dealt with companies and
regulators across the UK, Europe and the US.
Ms Kilgour previously held the role of Managing
Director in Citigroup's Corporate and
Investment Banking division in New York where
she had responsibility globally for anti-money
laundering, and compliance for Global
Transaction Services in over 100 countries. Ms
Kilgour also held the role of European General
Counsel and Company Secretary for Instinet,
the institutional agency-only broker segment of
Nomura Group, where she was responsible for
Ms Kwan brings more than 30 years’
experience in the financial services industry,
most recently as General Manager of Group
Support Services Finance at the
Commonwealth Bank of Australia. She also
held the roles of Chief Financial Officer at
Citigroup Australia and New Zealand. Ms
Kwan’s exceptional expertise in risk and
corporate governance, in-depth exposure to
international regulation and her established
relationships with C-suite compliance
personnel, will be a valuable asset to the
Company.
As part of the Board changes, Albert Wong
stepped down as Non-Executive Director, and
Benny Higgins moved into a Non-Executive
Chairman role, commencing 1 January 2019.
Outlook
Looking ahead, our forward strategy is shaped
by our commitment to innovate and evolve our
solutions and services. As regulatory
requirements and anti-money laundering
obligations only increase, we remain alert to
how we continue to support our clients in the
AML and KYC space.
We expect to build continued growth from the
recent launch of our web-based platform, and
we are also looking to engage strategic
partners, targeting collaborations that
complement and help drive opportunities for
further expansion.
Whilst our year has not been without its
challenges, we have made significant progress
and we will continue to lay a solid foundation to
create sustainable value for our clients,
shareholders and investors. The Company has
a clear strategy to deliver strong technology
6
and data to help clients with compliance
requirements, and the appointment of Ian
Henderson as the new CEO will play a vital role
in the operations and delivery across Kyckr’s
key markets.
On behalf of the Board, I would like to thank all
our shareholders, staff and clients for their
ongoing loyalty and support.
Benny Higgins
Non-Executive Chairman, Kyckr
27 September 2019
Ian Henderson
Chief Executive Officer, Kyckr
27 September 2019
7
Kyckr Limited
Corporate directory
30 June 2019
Directors
Benny Higgins
Benjamin Cronin
Robert Leslie
John Van Der Wielen
Karina Kwan
Jacqueline Kilgour
Company secretary
Karl Pechmann
Notice of annual general meeting
The details of the annual general meeting of Kyckr Limited are:
Monday, 18 November 2019, 9:00am, at:
Level 16, 1 Market Street
Sydney
NSW 2000
Registered office
Principal place of business
Share register
Auditor
Level 6, 36 Grosvenor Street
Sydney
NSW 2000
Level 6, 36 Grosvenor Street
Sydney
NSW 2000
Boardroom Pty Limited
Level 12, 225 George Street
Sydney
NSW 2000
Nexia Sydney Partnership
Level 16, 1 Market Street
Sydney
NSW 2000
Stock exchange listing
Kyckr Limited shares are listed on the Australian Securities Exchange (ASX code:
KYK)
Business objectives
Corporate Governance Statement
Kyckr Limited has used cash and cash equivalents held at the time of listing and the
time since listing to provide technology solutions to help protect against money
laundering, fraud and tax evasion, in a way consistent with its stated business
objectives. Kyckr aims to provide the pre-eminent automated technology solution to
maintain up to date critical company identity information, in place of the traditional
error and fraud prone manual people based processes.
The directors and management are committed to conducting the business of Kyckr
Limited in an ethical manner and in accordance with the highest standards of
corporate governance. Kyckr Limited has adopted and has substantially complied
with the ASX Corporate Governance Principles and Recommendations (Third Edition)
(‘Recommendations’) to the extent appropriate to the size and nature of its
operations.
The Corporate Governance Statement, which sets out the corporate governance
practices that were in operation during the financial year and identifies and explains
any Recommendations that have not been followed, was approved by the Board of
Directors at the same time as the Annual Report and can be found on the 'About us'
page at http://www.kyckr.com/
8
Kyckr Limited
Directors' report
30 June 2019
The directors present their report, together with the financial statements, on the consolidated entity (referred to hereafter as
the 'consolidated entity' or 'Group') consisting of Kyckr 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 2019.
Directors
The following persons were directors of Kyckr Limited during the whole of the financial year and up to the date of this
report, unless otherwise stated:
Benny Higgins - Non-Executive Chairman
Mr Benjamin Cronin - Executive Director
Mr Robert Leslie - Non-Executive Director
Mr John Van Der Wielen - Non-Executive Director
Ms Karina Kwan - Non-Executive Director (appointed on 19 November 2018)
Ms Jacqueline Kilgour - Non-Executive Director (appointed on 18 February 2019)
Mr Albert YL Wong - Non-Executive Director (resigned on 19 November 2018)
Principal activities
The principal activity of the Group during the period consisted of the provision of data and technology solutions to
accelerate customer acquisition and protect against money laundering, fraud and tax evasion. Kyckr’s solutions are
connected to over 200 regulated primary sources, in over 120 countries, providing real-time company registry information
for an estimated 80 million businesses globally. Kyckr provides automated technology solutions to improve the efficiency
and effectiveness of Corporate Know Your Client ('KYC') processes.
Dividends
There were no dividends paid, recommended or declared during the current or previous financial year.
Review of operations
The loss for the consolidated entity after providing for income tax amounted to $6,125,773 (30 June 2018: $3,547,445).
Refer to the Chairman's and Chief Executive Officer's Report for further detail.
Significant changes in the state of affairs
There were no significant changes in the state of affairs of the consolidated entity during the financial year.
Matters subsequent to the end of the financial year
On 7 August 2019, the company issued 32,350,159 ordinary shares at a price of $0.066 per share to institutional and
sophisticated investors. The total proceeds from the issuance of these securities amounted to $2,135,110.
On 13 September 2019, shareholders ratified the issue of securities at the Extraordinary General Meeting. In accordance
with the approval by shareholders, the company issued 46,000,000 ordinary shares at a price of $0.066 per share to
institutional and sophisticated investors. The total proceeds of the issuance of these securities amounted to $3,036,000.
No other matter or circumstance has arisen since 30 June 2019 that has significantly affected, or may significantly affect
the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future
financial years.
Likely developments and expected results of operations
Information on likely developments in the operations of the consolidated entity are included in the Chairman’s and Chief
Executive Officer’s Report on pages 2 to 7.
The Directors have identified the following business risks which may impact on the future performance of the Group:
Competition
The Group’s intellectual property rights are not protected by any registered patents in any jurisdiction. This may allow
competitors to develop products functionally similar to the Group’s existing products. The existence of competitors with
products that are functionally similar to the Group’s existing products could result in loss of customers and decline in
revenue, each of which could adversely affect the Group’s business and operating results.
9
Kyckr Limited
Directors' report
30 June 2019
Key Personnel Risk
The successful execution of the Group’s business model depends on a management team with the necessary talent and
experience to integrate and manage the Group’s growth plans. The loss of key management personnel could adversely
affect the Group’s business, results of operations or financial conditions and performance.
Current and Exchange Rate Fluctuations
The financial contribution of the Group will depend on the movement in exchange rates between the Australian Dollar and
a number of other foreign currencies. The exchange rate between various currencies may fluctuate substantially and the
result of these fluctuations may have an adverse impact on the Group’s operating results and financial position. The Group
does not enter into forward exchange contracts to hedge its anticipated purchase and sale commitments denominated in
foreign currencies.
Environmental regulation
The consolidated entity is not subject to any significant environmental regulation under Australian Commonwealth or State
law.
Information on directors
Name:
Title:
Qualifications:
Experience and expertise:
Mr Benny Higgins
Non-Executive Chairman (previously Executive Chairman from 1 April 2018 to 31
December 2018)
Benny holds a First Class Honours degree in Mathematics from the University of
Glasgow and is a Fellow of the Faculty of Actuaries. He is a Fellow of the Chartered
Institute of bankers in Scotland and a Fellow of the Royal Society of Edinburgh. In
2018 he was announced as a Visiting Professor at Strathclyde University and the
Edinburgh Business School based in Heriot-Watt University.
Benny Higgins has been a prominent international business leader for over thirty
years, leading businesses in financial services and retail.
Benny began his career at Standard Life in 1983 where he joined as an actuarial
student and became a member of the Standard Life Group Executive in 1996. In
1997, he moved to RBS to become Chief Executive of Retail Banking. He was with
RBS until 2015, during which time he led the successful integration of NatWest Retail
Banking - one of the largest mergers ever undertaken in UK banking. He became
Chief Executive Officer of HBOS plc in 2006 before joining Tesco Bank as Chief
Executive in 2008.
Under Benny’s leadership, Tesco Bank grew to become one of the most established
‘new’ banks in the UK, serving more than 6 million customers and employing over
4,000 people in Edinburgh, Glasgow and Newcastle. In addition to his role at Tesco
Bank, Benny was also the Group Strategy Director for Tesco PLC and was a member
of the Tesco Executive Committee. Benny retired from Tesco in February 2018.
In September 2017, Benny was asked by the Scottish Government to lead a project
team to establish the creation of a Scottish National Investment Bank. In June 2018,
Benny was announced as the strategic adviser of the Scottish National Investment
Bank, leading its formation.
Outside of financial services, Benny is Chairman of the National Galleries of Scotland,
a Non-Executive Director of Glasgow Life, Non-Executive Director for the Buccleuch
Group and a Prince’s Trust Ambassador.
Other current directorships:
None
Former directorships (last 3 years): None
Special responsibilities:
Member of the Audit and Risk Management Committee and the Nomination and
Remuneration Committee
1,000,000 ordinary shares
2,000,000 options over ordinary shares
None
Interests in shares:
Interests in options:
Interests in rights:
10
Kyckr Limited
Directors' report
30 June 2019
Name:
Title:
Experience and expertise:
Mr. Benjamin Michael Cronin
Executive Director
Ben is the founder of Kyckr Ireland Limited (formerly Global Business Register
Limited). He fulfils the combined roles of managing all operating activities, personnel
and developing prospects and clients.
Ben has established relationships with numerous government registers and registrars
over the last 10 years. His understanding of the Company register domain is
extensive and he has presented at numerous register conferences over the years.
Ben was a professional Rugby Union player, playing for Munster and Ireland.
Prior to setting up GBR, Ben was a successful property developer including bid
management roles on Primary Healthcare Centre Projects and a Co-Location
Hospital (Public Private Partnerships) Project.
Other current directorships:
None
Former directorships (last 3 years): None
None
Special responsibilities:
8,529,129 ordinary shares
Interests in shares:
None
Interests in options:
6,500,000 performance rights over ordinary shares
Interests in rights:
Name:
Title:
Qualifications:
Experience and expertise:
Mr Robert Leslie
Non-Executive Director
B. Eng. (Electronics)
Robert is an electronics engineer by profession and a co- founder of Kyckr Ireland
(formerly Global Business Register Limited). Robert has worked
Limited
internationally for Dell in Japan.
Rob is a mentor with Enterprise Ireland’s network, providing support to high potential
start-up entrepreneurs. He is also the founder of Sedicii, which has developed an
identity platform that allows individuals to prove their identity to organisations without
having to share any personal information in the process.
Rob is a source of innovation and strategy in technology products. He was recently
selected by the World Economic Forum as a Technology Pioneer for 2015 and invited
to talk at Davos.
Other current directorships:
None
Former directorships (last 3 years): None
None
Special responsibilities:
6,619,247 ordinary shares
Interests in shares:
None
Interests in options:
6,500,000 performance rights over ordinary shares
Interests in rights:
11
Kyckr Limited
Directors' report
30 June 2019
Name:
Title:
Qualifications:
Experience and expertise:
Mr John Van Der Wielen
Non-Executive Director
MBA FAICD
John has over 30 years in insurance, wealth management, private banking and
investments including executive positions within several global financial services
groups, commencing as Chief Executive Officer and Managing Director of HBF in
May 2017. This involved leading a number of acquisitions, integration and
restructuring programs and senior executive board membership of listed ASX, FTSE,
European and Asian entities. John is experienced in fronting stock markets, liaising
with direct investors and meeting analysts on company strategy and performance in
many international markets.
John was previously CEO of Friends Life UK and International in London and prior to
this he was the Managing Director Wealth at ANZ Bank in Sydney.
Most recently John has been a Senior Adviser for Blackstone in the financial services
arena and an independent non-executive on several boards.
He holds an MBA from the University of Western Australia and has studied at London
Business School and Oxford University. He is a Fellow of the Australian Institute of
Company Directors.
John is an Advisory Member of the Business School for the University of Western
Australia and has been appointed as a Non Executive Director of the Royal Flying
Doctor Service Western Australia.
None
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Chair of the Audit and Risk Management Committee and member of the Nomination
and Remuneration Committee
1,100,109 ordinary shares
2,000,000 options over ordinary shares
None
Interests in shares:
Interests in options:
Interests in rights:
Name:
Title:
Qualifications:
Experience and expertise:
Karina Kwan
Non-Executive Director
Karina holds a Bachelor of Economics from Sydney University, is a CPA Australia
Fellow and a Graduate of the Australian Institute of Company Directors.
Karina has led an accomplished executive career spanning 30 years in the financial
services industry, most recently as General Manager of Group Support Services
Finance at the Commonwealth Bank of Australia. Prior to this, she spent 18 years
with Citi, of which the last 3 years was in the role of Chief Financial Officer for
Australia and New Zealand. During her time at Citi, she performed the role of
Corporate Treasurer for 12 years, during which time she also chaired the Institutional
Bank’s New Product Approval Committee.
She is currently Non-Executive Director and Chair of the Audit & Risk Committee at
WAM Active Limited and Member of the Board of Advice at The University of Sydney
Business School.
Non-Executive Director of WAM Active Limited (ASX: WAA)
Chair of the Nomination and Remuneration Committee and member of the Audit and
Risk Management Committee
None
None
Other current directorships:
Former directorships (last 3 years): None
Special responsibilities:
Interests in shares:
Interests in options:
12
Kyckr Limited
Directors' report
30 June 2019
Name:
Title:
Qualifications:
Experience and expertise:
Jacqueline Kilgour
Non-Executive Director
Jacqueline qualified as a Solicitor in England and Wales and is a member of the Law
Society of England and Wales, Chartered Institute for Securities & Investment,
Securities Industry and Financial Markets Association (SIFMA) and the Society of
Trust and Estate Practitioners (STEP) and has passed New York Stock Exchange
Series 14 (Compliance Official).
Jacqueline brings more than 30 years’ financial services experience in regulatory
compliance, anti money laundering (AML) and corporate governance matters. She
has successfully dealt with companies and regulators across a number of
jurisdictions.
Jacqueline held the role of Managing Director in Citigroup's Corporate and
Investment Banking division in New York where she had responsibility globally for
anti-money laundering, and compliance for Global Transaction Services in over 100
countries plus a number of central Compliance functions.
In addition to her Citigroup experience, Jacqueline was European General Counsel
and Company Secretary for Instinet, the institutional agency-only broker part of
Nomura Group, where she was responsible for legal, compliance and corporate
governance in Europe and Asia-Pacific. Prior to that, Jacqueline was Co-Head of
European Compliance at Salomon Brothers and also worked in the Legal Department
of a large energy utility.
She has practised law at Cameron Markby Hewitt (now CMS) in London and Blake
Dawson Waldron (now Ashurst) in Melbourne, Australia. Jacqueline is currently is the
Managing Director of a regulatory compliance and governance consultancy firm and
acts as a Non-Executive Directors for two regulated entities in the UK and another in
the US.
None
Other current directorships:
Former directorships (last 3 years): None
None
Special responsibilities:
None
Interests in shares:
None
Interests in options:
Name:
Title:
Qualifications:
Experience and expertise:
Other current directorships:
Former directorships (last 3 years):
Special responsibilities:
Mr Albert YL Wong AM (resigned on 19 November 2018)
Non-Executive Director
B Com. FAICD F Fin
Albert has more than 30 years’ experience in stockbroking and investment banking.
He has worked for Merrill Lynch in Sydney and was a Member of the Australian
Securities Exchange. He has been instrumental in the listing of numerous small cap
companies and served on the boards of the same and others over the years. He is a
Fellow of the Australian Institute of Company Directors and a fellow of FINSIA.
Albert ’s philanthropic endeavours include serving on the UNSW Foundation Board of
Directors, Honorary Life Governor and former President for the University of Sydney’s
Physics Foundation, Director of the Australian Museum Foundation and serving on
the Board of Directors of the Children’s Medical Research Institute and its
Foundation.
None
Immutep Limited (formerly Prima BioMed Limited)
Not applicable
'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 only and
excludes directorships of all other types of entities, unless otherwise stated.
13
Kyckr Limited
Directors' report
30 June 2019
Company secretary
Karl Pechmann is a Chartered Accountant and Chartered Company Secretary. He has more than 15 years of diverse
business experience across a range of industries including media, labour hire and biotechnology. He commenced his
career with KPMG where he gained experience in audit, business advisory and corporate finance roles across a range of
clients and industries. He has held senior finance positions at both ASX-listed and multi-national companies, being
involved in M&A activity, strategic reviews and performance improvement initiatives.
Meetings of directors
The number of meetings of the company's Board of Directors ('the Board') held during the year ended 30 June 2019, and
the number of meetings attended by each director were:
Full Board
Attended
Held
Nomination and
Remuneration Committee
Attended
Held
Audit and Risk Management
Committee
Attended
Held
Benny Higgins
Benjamin Cronin
Robert Leslie
John Van Der Wielen
Karina Kwan
Jacqueline Kilgour
Albert YL Wong
7
7
8
7
5
4
2
8
8
8
8
5
4
3
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3
-
-
3
2
-
1
3
-
-
3
2
-
1
Held: represents the number of meetings held during the time the director held office.
Remuneration report (audited)
The remuneration report details the key management personnel remuneration arrangements for the consolidated entity, in
accordance with the requirements of the Corporations Act 2001 and its Regulations.
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly, including all directors.
The 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
Principles used to determine the nature and amount of remuneration
The objective of the consolidated entity'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
transparency
The Nomination and Remuneration Committee is responsible for determining and reviewing remuneration arrangements
for its directors and executives. The performance of the consolidated entity 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 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
attracting and retaining high calibre executives
●
14
Kyckr Limited
Directors' report
30 June 2019
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
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 are entitled to receive share options and performance rights.
ASX listing rules require the aggregate non-executive directors' remuneration be determined periodically by a general
meeting. As set out in the IPO Prospectus, total aggregate remuneration available to Non-executive directors was set at
$500,000 per annum. Non-executive director fees (Directors' fees and committee fees, inclusive of superannuation)
proposed for the year ending 30 June 2020 are summarised as follows:
Name
Benny Higgins
John Van Der Wielen
Robert Leslie
Karina Kwan
Jacqueline Kilgour
Fees
₤65,000
$65,000
$65,000
$65,000
$65,000
Executive remuneration
The consolidated entity 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 four components:
●
●
●
●
base pay and non-monetary benefits
short-term performance incentives
share-based payments
other remuneration such as superannuation and long service leave
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 consolidated entity 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 consolidated entity and provides additional value to the
executive.
The short-term incentives ('STI') program is designed to align the targets of the business units with the performance
hurdles of executives. STI payments are granted to executives based on specific annual targets and key performance
indicators ('KPI's') being achieved. KPI's include profit contribution, customer satisfaction, leadership contribution and
product management.
The long-term incentives ('LTI') include long service leave and share-based payments.
On 1 September 2016, 4,000,000 unlisted options were granted to Key Management Personnel. The exercise price of the
options of $0.30 was 50% higher than the Initial Public Offering price. The options are exercisable upon meeting certain
revenue targets within four years from the date of grant. The contractual life of each option is four years.
15
Kyckr Limited
Directors' report
30 June 2019
On 1 September 2016, 20,000,000 performance rights were granted to certain Directors and Key Management Personnel.
The performance rights are exercisable at Nil value. The performance rights vest upon meeting the following conditions:
●
50% of the performance rights automatically convert upon the Company achieving a turnover of $5 million or more as
set out in the full year or half-yearly financial statements released to the ASX; and
50% of the Performance rights automatically convert upon the Company achieving a turnover of $10 million or more
as set out in its yearly or half-yearly financial statements released to the ASX.
●
On 30 November 2016, 3,000,000 unlisted options exercisable at $0.30 were granted to senior executives under the Long
Term Incentive Plan approved by shareholders at the Annual General Meeting held on 30 November 2016. The exercise
price of the options of $0.30 was 22.45% higher than market price of the shares on the date of grant. The vesting of these
options is conditional on continued employment until the vesting date, being two years from grant date. The contractual life
of each option is four years.
On 10 August 2018, 1,000,000 unlisted options were granted to Benny Higgins, a Director of the company. The exercise
price of the options of $0.20 was 48% higher than the market price of the shares on the date of grant. The options vested
immediately and the contractual life of each option is four years.
On 10 August 2018, 1,000,000 unlisted options were granted to Benny Higgins, a Director of the Company. The exercise
price of the options of $0.26 was 93% higher than the market price of the shares on the date of grant. The options vest on
1 March 2019 and the contractual life of each option is four years.
On 1 January 2019, 3,000,000 unlisted options were granted to Ian Henderson. The exercise price of the options of
$0.1005 was 50% higher than the market price of the shares at the date of grant. The vesting of these options is
conditional on continued employment until the vesting date, being 3 years from grant date. The contractual life of each
option is 4 years.
On 1 January 2019, 5,391,063 unlisted performance rights were granted to Ian Henderson in lieu of the first year’s cash
salary of £210,000. The performance rights have service-based vesting conditions only. The vesting date is 1 January
2020, expiring 1 April 2020. Once the vesting conditions are met, the performance rights will be exercisable at nil cost.
The Board of Directors reviewed the long-term equity-linked performance incentives specifically for executives during the
year ended 30 June 2019.
Consolidated entity performance and link to remuneration
Remuneration for certain individuals is directly linked to the performance of the consolidated entity. A portion of cash bonus
and incentive payments are dependent on defined earnings per share targets being met. The remaining portion of the cash
bonus and incentive payments are at the discretion of the Nomination and Remuneration Committee.
The Nomination and Remuneration Committee is of the opinion that the adoption of performance based compensation will
contribute to future improvements in performance and will increase shareholder wealth over the coming years.
Use of remuneration consultants
During the financial year ended 30 June 2019, the company did not engage remuneration consultants to review its existing
remuneration policies and provide recommendations on how to improve both the STI and LTI programs.
Voting and comments made at the company's 2018 Annual General Meeting ('AGM')
At the 2018 AGM, 99.46% of the votes received supported the adoption of the remuneration report for the year ended 30
June 2018. The company did not receive any specific feedback at the AGM regarding its remuneration practices.
Details of remuneration
Amounts of remuneration
Details of the remuneration of key management personnel of the consolidated entity are set out in this section.
16
Kyckr Limited
Directors' report
30 June 2019
The key management personnel of the consolidated entity consisted of the following directors of Kyckr Limited:
●
●
●
●
●
●
●
Benny Higgins
Benjamin Cronin
John Van Der Wielen
Robert Leslie
Karina Kwan (appointed on 19 November 2018)
Jacqueline Kilgour (appointed on 18 February 2019)
Albert YL Wong (resigned on 19 November 2018)
And the following persons:
●
●
Ian Henderson - Chief Executive Officer (appointed 1 January 2019)
Karl Pechmann - Chief Financial Officer and Company Secretary
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
monetary
$
Super-
annuation
$
Long
service
leave
$
Equity-
settled
$
147,014
-
-
-
-
25,855
Total
$
307,948
50,000
50,233
40,081
23,507
50,855
-
239,234
-
-
-
-
-
-
-
-
19,950
29,934
-
2,792
2,792
198,784
(20,725)
350,928
198,784
222,555
1,183,197
2019
Non-Executive Directors:
B Higgins
J Van Der Wielen
R Leslie
Karina Kwan*
J Kilgour*
A Wong*
Executive Directors:
B Cronin
Other Key Management
Personnel:
I Henderson*
K Pechmann
-
4,338
-
3,477
-
2,169
-
160,934
45,662
50,233
36,604
23,507
22,831
239,234
-
220,538
799,543
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
*
represents remuneration from the date of appointment and/or up to the date of resignation
17
Kyckr Limited
Directors' report
30 June 2019
2018
Non-Executive Directors:
J Van Der Wielen
A Wong
J Walsh*
P Curry*
Executive Directors:
B Higgins*
R Leslie
B Cronin
Other Key Management
Personnel:
D Cassidy*
K Pechmann
Short-term benefits
Post-
employment
benefits
Long-term
benefits
Share-
based
payments
Cash salary
and fees
$
Cash
bonus
$
Non-
monetary
$
Super-
annuation
$
Long
service
leave
$
Equity-
settled
$
Total
$
38,052
38,052
16,667
16,667
76,537
99,949
230,769
225,025
202,825
944,543
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3,615
3,615
-
-
-
-
-
-
-
-
-
-
-
-
51,038
149,795
-
10,690
92,705
191,462
16,667
27,357
-
-
-
76,537
99,949
230,769
20,425
19,237
46,892
(1,080)
2,502
1,422
(124,350)
49,932
137,105
120,020
274,496
1,129,962
*
represents remuneration from the date of appointment and/or up to the date of resignation
The proportion of remuneration linked to performance and the fixed proportion are as follows:
Name
Non-Executive Directors:
B Higgins
J Van Der Wielen
R Leslie
K Kwan
J Kilgour
A Wong
P Curry
Executive Directors:
B Cronin
Other Key Management
Personnel:
I Henderson
K Pechmann
D Cassidy
Fixed remuneration
2018
2019
At risk - STI
At risk - LTI
2019
2018
2019
2018
53%
100%
100%
100%
100%
49%
-
100%
45%
100%
-
-
22%
61%
100%
100%
-
109%
-
-
82%
203%
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
47%
-
-
-
-
51%
-
-
55%
-
-
-
78%
39%
-
-
100%
(9%)
-
-
18%
(103%)
18
Kyckr Limited
Directors' report
30 June 2019
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:
Term of agreement:
Details:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Name:
Title:
Agreement commenced:
Term of agreement:
Details:
Ian Henderson
Chief Executive Officer
1 January 2019
No fixed term
Ian receives a base salary of ₤210,000 and is eligible to participate in the long term
incentive plans of the consolidated entity. Either party can terminate the employment
contract by giving 6 months’ notice in writing.
Benjamin Cronin
Head of Regulatory Development
6 September 2016
No fixed term
Ben receives a base salary of €150,000 and is eligible to participate in the long term
incentive plans of the consolidated entity. Ben may terminate his employment
contract by giving 3 months’ notice in writing. The company can terminate his contract
by giving 3 months' notice in writing and providing 12 months' pay.
Karl Pechmann
Chief Financial Officer and Company Secretary
6 September 2016
No fixed term
Karl receives a base salary of $210,000 plus superannuation and is eligible to
participate in the long term incentive plans of the consolidated entity. Karl may
terminate his employment contract by giving 3 months’ notice in writing.
Key management personnel have no entitlement to termination payments in the event of removal for misconduct.
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 2019.
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:
Name
B Higgins
B Higgins
I Henderson
Number of
options
granted
Grant date
Vesting
and
exercisable date
Expiry date
Exercise price at grant date
Fair value
per option
1,000,000 10/08/2018
1,000,000 10/08/2018
3,000,000 01/01/2019
10/08/2018
10/08/2019
01/01/2022
10/08/2022
10/08/2022
01/01/2023
$0.20
$0.26
$0.10
$0.08
$0.07
$0.04
Options granted carry no dividend or voting rights.
All options were granted over unissued fully paid ordinary shares in the company. Options vest based on the provision of
service over the vesting period whereby the executive becomes beneficially entitled to the option on vesting date. Options
are exercisable by the holder as from the vesting date. There has not been any alteration to the terms or conditions of the
grant since the grant date. There are no amounts paid or payable by the recipient in relation to the granting of such options
other than on their potential exercise.
19
Kyckr Limited
Directors' report
30 June 2019
The number of options over ordinary shares granted to and vested in directors and other key management personnel as
part of compensation during the year ended 30 June 2019 are set out below:
Name
B Higgins
I Henderson
J Van Der Wielen
Number of
options
granted
during the
year
2019
2,000,000
3,000,000
-
Number of
options
granted
during the
year
2018
Number of
options
vested
during the
year
2019
Number of
options
vested
during the
year
2018
-
-
-
-
-
-
-
-
1,000,000
Performance rights
The terms and conditions of each grant of performance rights over ordinary shares affecting remuneration of directors and
other key management personnel in this financial year or future reporting years are as follows:
Name
D Cassidy
B Cronin
R Leslie
A Wong
K Pechmann
I Henderson
Number of
rights
granted
Grant date
Expiry date
3,000,000 01/09/2016
6,500,000 01/09/2016
6,500,000 01/09/2016
3,000,000 01/09/2016
1,000,000 01/09/2016
5,391,063 01/01/2019
01/09/2020
01/09/2020
01/09/2020
01/09/2020
01/09/2020
01/01/2023
Fair value
per right
at grant date
$0.20
$0.20
$0.20
$0.20
$0.20
$0.07
*
All performance rights can vest and become exercisable between 1 September 2016 and 1 September 2020 upon
achieving the performance criteria.
Performance rights granted carry no dividend or voting rights.
The number of performance rights over ordinary shares granted to, vested and forfeited by directors and other key
management personnel as part of compensation during the years ended 30 June 2019 and 30 June 2018 are set out
below:
Number of
rights granted
during the
year
2019
Number of
rights granted
during the
year
2018
Number of
rights forfeited
during the
year
2019
Number of
rights forfeited
during the
year
2018
I Henderson
D Cassidy
5,391,063
-
-
-
-
-
-
(3,000,000)
No rights vested during the years ended 30 June 2019.
20
Kyckr Limited
Directors' report
30 June 2019
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 consolidated entity, including their personally related parties, is set out below:
Ordinary shares
B Higgins
J Van Der Wielen
R Leslie
A Wong*
B Cronin
K Pechmann
Balance at
the start of
the year
Received
as part of
remuneration
Additions
Disposals/
other*
-
789,404
9,619,247
5,130,213
8,519,129
151,812
24,209,805
-
-
-
-
-
-
-
1,000,000
310,705
-
-
-
-
1,310,705
-
-
-
(5,130,213)
-
-
(5,130,213)
Balance at
the end of
the year
1,000,000
1,100,109
9,619,247
-
8,519,129
151,812
20,390,297
*
Disposals/other may represent no longer being designated as a KMP, not necessarily a disposal of holding.
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 consolidated entity, including their personally related parties, is set out
below:
Options over ordinary shares
B Higgins
J Van Der Wielen
A Wong*
I Henderson
K Pechmann
Balance at
the start of
the year
-
2,000,000
1,500,000
-
1,000,000
4,500,000
Granted
Exercised
2,000,000
-
-
3,000,000
-
5,000,000
Expired/
forfeited/
other*
Balance at
the end of
the year
-
-
-
-
-
-
-
-
(1,500,000)
-
-
(1,500,000)
2,000,000
2,000,000
-
3,000,000
1,000,000
8,000,000
*
Expire/forfeited/other may represent no longer being designated as a KMP, it does not necessarily represent options
that have expired or have been forfeited.
Performance rights holding
The number of performance rights over ordinary shares in the company held during the financial year by each director and
other members of key management personnel of the consolidated entity, including their personally related parties, is set
out below:
Performance rights over ordinary shares
R Leslie
A Wong*
B Cronin
I Henderson
K Pechmann
Balance at
the start of
the year
6,500,000
3,000,000
6,500,000
-
1,000,000
17,000,000
Granted
Vested
-
-
-
5,391,063
-
5,391,063
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
-
-
-
-
(3,000,000)
-
-
-
(3,000,000)
6,500,000
-
6,500,000
5,391,063
1,000,000
19,391,063
*
Expire/forfeited/other may represent no longer being designated as a KMP, it does not necessarily represent options
that have expired or have been forfeited.
21
Kyckr Limited
Directors' report
30 June 2019
Other transactions with key management personnel and their related parties
During the financial year, expenses for investor relations services from Barton Place Pty Ltd (director-related entity of
Albert Wong) of $Nil (2018: $27,502) were incurred. All transactions were made on normal commercial terms and
conditions and were at market rates.
This concludes the remuneration report, which has been audited.
Shares under option
Unissued ordinary shares of Kyckr Limited under option at the date of this report are as follows:
Grant date
01/09/2016
01/09/2016
30/11/2016
30/11/2016
02/01/2018
10/08/2018
10/08/2018
01/01/2019
Expiry date
01/09/2020
01/09/2020
30/11/2020
30/11/2020
02/01/2022
10/08/2022
10/08/2022
01/01/2023
Exercise
price
Number
under option
$0.20
$0.30
$0.30
$0.30
$0.30
$0.20
$0.26
$0.10
4,000,000
4,000,000
2,722,222
2,000,000
2,000,000
1,000,000
1,000,000
3,000,000
19,722,222
No person entitled to exercise the options had or has any right by virtue of the option to participate in any share issue of
the company or of any other body corporate.
Shares under performance rights
Unissued ordinary shares of Kyckr Limited under performance rights at the date of this report are as follows:
Grant date
01/09/2016
01/01/2019
Expiry date
01/09/2020
01/04/2020
Number
under rights
7,000,000
5,931,063
12,931,063
No person entitled to exercise the performance rights had or has any right by virtue of the performance right to participate
in any share issue of the company or of any other body corporate.
Shares issued on the exercise of options
There were no ordinary shares of Kyckr Limited issued on the exercise of options during the year ended 30 June 2019 and
up to the date of this report.
Shares issued on the exercise of performance rights
There were no ordinary shares of Kyckr Limited issued on the exercise of performance rights during the year ended 30
June 2019 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.
22
Kyckr Limited
Directors' report
30 June 2019
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
There were no non-audit services provided during the financial year by the auditor.
Officers of the company who are former partners of Nexia Sydney Partnership
There are no officers of the company who are former partners of Nexia Sydney Partnership.
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
Nexia Sydney Partnership continues in office in accordance with section 327 of the Corporations Act 2001.
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
___________________________
Benny Higgins
Chairman
27 September 2019
Sydney
___________________________
John Van Der Wielen
Director
23
To the Board of Directors of Kyckr Limited
Auditor’s Independence Declaration under section 307C of the Corporations Act 2001
As lead audit partner for the audit of the financial statements of Kyckr Limited for the financial year ended
30 June 2019, I declare that to the best of my knowledge and belief, there have been no contraventions of:
(a)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(b)
any applicable code of professional conduct in relation to the audit.
Yours sincerely
Nexia Sydney Partnership
Lester Wills
Partner
Date: 27 September 2019
24
Kyckr Limited
Statement of profit or loss and other comprehensive income
For the year ended 30 June 2019
Revenue
Other income
Interest revenue calculated using the effective interest method
Expenses
Direct costs and consumables used
Employee benefits expense
Share-based payments expense
Depreciation and amortisation expense
Impairment of intangible assets
Impairment of receivables
Consultancy and professional fees
Occupancy expenses
Travel expenses
Net foreign exchange loss
Listing related expenses
Other expenses
Finance costs
Loss before income tax expense
Income tax expense
Consolidated
Note
2019
$
2018
$
5
6
7
7
7
7
10
7
8
2,138,671
1,724,409
1,871,855
84,556
513,644
42,611
(886,328)
(2,964,872)
(534,996)
(62,655)
(3,801,663)
(89,196)
(611,441)
(142,203)
(207,930)
(5,050)
(248,219)
(653,168)
(13,134)
(670,633)
(2,999,223)
(337,763)
(56,738)
-
(7,042)
(517,014)
(134,509)
(298,907)
(4,944)
(232,541)
(531,473)
(37,322)
(6,125,773)
(3,547,445)
-
-
Loss after income tax expense for the year attributable to the owners of Kyckr
Limited
(6,125,773)
(3,547,445)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
Other comprehensive income for the year, net of tax
Total comprehensive income for the year attributable to the owners of Kyckr
Limited
Basic earnings per share
Diluted earnings per share
809
809
32,816
32,816
(6,124,964)
(3,514,629)
Cents
Cents
32
32
(4.09)
(4.09)
(3.24)
(3.24)
The above statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes
25
Kyckr Limited
Statement of financial position
As at 30 June 2019
Assets
Current assets
Cash and cash equivalents
Trade and other receivables
Other
Total current assets
Non-current assets
Property, plant and equipment
Intangibles
Total non-current assets
Total assets
Liabilities
Current liabilities
Trade and other payables
Contract liabilities
Borrowings
Employee benefits
Contingent consideration
Total current liabilities
Non-current liabilities
Employee benefits
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Total equity
Consolidated
Note
2019
$
2018
$
9
10
11
12
13
14
15
16
17
18
1,448,660
418,286
174,934
2,041,880
4,575,703
366,612
124,141
5,066,456
49,035
9,627,372
9,676,407
56,670
12,565,203
12,621,873
11,718,287
17,688,329
839,214
158,000
54,348
21,434
214,500
1,287,496
831,299
69,800
-
14,843
2,080,000
2,995,942
7,079
7,079
-
-
1,294,575
2,995,942
10,423,712
14,692,387
19
20
21,798,633
2,477,342
(13,852,263)
20,477,340
1,941,537
(7,726,490)
10,423,712
14,692,387
The above statement of financial position should be read in conjunction with the accompanying notes
26
Kyckr Limited
Statement of changes in equity
For the year ended 30 June 2019
Consolidated
Balance at 1 July 2017
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 19)
Share-based payments (note 33)
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
14,897,543
1,570,958
(4,179,045)
12,289,456
-
-
-
-
32,816
(3,547,445)
-
(3,547,445)
32,816
32,816
(3,547,445)
(3,514,629)
5,579,797
-
-
337,763
-
-
5,579,797
337,763
Balance at 30 June 2018
20,477,340
1,941,537
(7,726,490)
14,692,387
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 19)
Share-based payments (note 33)
Issued
capital
$
Reserves
$
Accumulated
losses
$
Total equity
$
20,477,340
1,941,537
(7,726,490)
14,692,387
-
-
-
-
809
(6,125,773)
-
(6,125,773)
809
809
(6,125,773)
(6,124,964)
1,321,293
-
-
534,996
-
-
1,321,293
534,996
Balance at 30 June 2019
21,798,633
2,477,342
(13,852,263)
10,423,712
The above statement of changes in equity should be read in conjunction with the accompanying notes
27
Kyckr Limited
Statement of cash flows
For the year ended 30 June 2019
Cash flows from operating activities
Receipts from customers (inclusive of GST)
Payments to suppliers and employees (inclusive of GST)
Interest received
Interest and other finance costs paid
Net cash used in operating activities
Cash flows from investing activities
Payments for property, plant and equipment
Payments for intangibles
Net cash used in investing activities
Cash flows from financing activities
Proceeds from issue of shares
Share issue transaction costs
Proceeds from borrowings
Repayment of borrowings
Net cash from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the financial year
Effects of exchange rate changes on cash and cash equivalents
Consolidated
Note
2019
$
2018
$
2,396,259
(6,067,182)
1,725,581
(5,108,652)
(3,670,923)
84,556
(6,779)
(3,383,071)
42,611
-
31
(3,593,146)
(3,340,460)
12
13
19
19
(24,217)
(885,321)
(45,728)
(281,239)
(909,538)
(326,967)
1,407,878
(86,585)
106,601
(52,253)
5,945,441
(365,644)
-
-
1,375,641
5,579,797
(3,127,043)
4,575,703
-
1,912,370
2,670,859
(7,526)
Cash and cash equivalents at the end of the financial year
9
1,448,660
4,575,703
The above statement of cash flows should be read in conjunction with the accompanying notes
28
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 1. General information
The financial statements cover Kyckr Limited as a consolidated entity consisting of Kyckr Limited and the entities it
controlled at the end of, or during, the year. The financial statements are presented in Australian dollars, which is Kyckr
Limited's functional and presentation currency.
Kyckr Limited is a listed public company limited by shares, incorporated and domiciled in Australia. Its registered office and
principal place of business is:
Level 6, 36 Grosvenor Street
Sydney
NSW 2000
A description of the nature of the consolidated entity'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 27 September 2019.
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 consolidated entity has adopted all of the new or amended Accounting Standards and Interpretations issued by the
Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period.
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 consolidated entity:
AASB 9 Financial Instruments
The consolidated entity has adopted AASB 9 from 1 July 2018. The standard introduced new classification and
measurement models for financial assets. A financial asset shall be measured at amortised cost if it is held within a
business model whose objective is to hold assets in order to collect contractual cash flows which arise on specified dates
and that are solely principal and interest. A debt investment shall be measured at fair value through other comprehensive
income if it is held within a business model whose objective is to both hold assets in order to collect contractual cash flows
which arise on specified dates that are solely principal and interest as well as selling the asset on the basis of its fair value.
All other financial assets are classified and measured at fair value through profit or loss unless the entity makes an
irrevocable election on initial recognition to present gains and losses on equity instruments (that are not held-for-trading or
contingent consideration recognised in a business combination) in other comprehensive income ('OCI'). Despite these
requirements, a financial asset may be irrevocably designated as measured at fair value through profit or loss to reduce the
effect of, or eliminate, an accounting mismatch. For financial liabilities designated at fair value through profit or loss, the
standard requires the portion of the change in fair value that relates to the entity's own credit risk to be presented in OCI
(unless it would create an accounting mismatch). New simpler hedge accounting requirements are intended to more
closely align the accounting treatment with the risk management activities of the entity. New impairment requirements use
an 'expected credit loss' ('ECL') model to recognise an allowance. Impairment is measured using a 12-month ECL method
unless the credit risk on a financial instrument has increased significantly since initial recognition in which case the lifetime
ECL method is adopted. For receivables, a simplified approach to measuring expected credit losses using a lifetime
expected loss allowance is available.
29
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
AASB 15 Revenue from Contracts with Customers
The consolidated entity has adopted AASB 15 from 1 July 2018. The standard provides a single comprehensive model for
revenue recognition. The core principle of the standard is that an entity shall recognise revenue to depict the transfer of
promised goods or services to customers at an amount that reflects the consideration to which the entity expects to be
entitled in exchange for those goods or services. The standard introduced a new contract-based revenue recognition
model with a measurement approach that is based on an allocation of the transaction price. This is described further in the
accounting policies below. Credit risk is presented separately as an expense rather than adjusted against revenue.
Contracts with customers are presented in an entity's statement of financial position as a contract liability, a contract asset,
or a receivable, depending on the relationship between the entity's performance and the customer's payment. Customer
acquisition costs and costs to fulfil a contract can, subject to certain criteria, be capitalised as an asset and amortised over
the contract period.
Impact of adoption
The adoption of AASB 9 and AASB 15 resulted in the following adjustments:
interest receivable is now shown on the face of the profit or loss;
●
provision for impairment of receivables is now reclassified as allowance for expected credit losses; and
●
deferred revenue is now reclassified as contract liability.
●
There were no material changes in the carrying amounts on adoption of AASB 9 and AASB 15 standards as at 1 July
2018.
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, except for, where applicable, the
revaluation of financial assets and liabilities at fair value through profit or loss, financial assets at fair value through other
comprehensive income, investment properties, certain classes of property, plant and equipment and derivative financial
instruments.
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 consolidated entity'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 consolidated entity
only. Supplementary information about the parent entity is disclosed in note 29.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Kyckr Limited ('company' or
'parent entity') as at 30 June 2019 and the results of all subsidiaries for the year then ended. Kyckr Limited and its
subsidiaries together are referred to in these financial statements as the 'consolidated entity'.
Subsidiaries are all those entities over which the consolidated entity has control. The consolidated entity controls an entity
when the consolidated entity 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 consolidated entity. They are de-consolidated from the date that control
ceases.
Intercompany transactions, balances and unrealised gains on transactions between entities in the consolidated entity 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 consolidated entity.
30
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
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 consolidated entity loses control over a subsidiary, it derecognises the assets including goodwill, liabilities and
non-controlling interest in the subsidiary together with any cumulative translation differences recognised in equity. The
consolidated entity recognises the fair value of the consideration received and the fair value of any investment retained
together with any gain or loss in profit or loss.
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.
Foreign currency translation
The financial statements are presented in Australian dollars, which is Kyckr Limited's functional and presentation currency.
Foreign currency transactions
Foreign currency transactions are translated into Australian dollars using the exchange rates prevailing at the dates of the
transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at financial year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in profit or loss.
Foreign operations
The assets and liabilities of foreign operations are translated into Australian dollars using the exchange rates at the
reporting date. The revenues and expenses of foreign operations are translated into Australian dollars using the average
exchange rates, which approximate the rates at the dates of the transactions, for the period. All resulting foreign exchange
differences are recognised in other comprehensive income through the foreign currency reserve in equity.
The foreign currency reserve is recognised in profit or loss when the foreign operation or net investment is disposed of.
Revenue recognition
The consolidated entity recognises revenue as follows:
Revenue from contracts with customers
Revenue is recognised at an amount that reflects the consideration to which the consolidated entity is expected to be
entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the consolidated
entity: 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.
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 initially recognised as deferred revenue in the form of a separate
refund liability.
Rendering of services
Online revenue is recognised at a point in time when an online document search and purchase service is provided to the
customer. Enterprise revenue is recognised over a period of time as services are provided including automation and
perpetual validation of customer ‘Know your client’ data, timing differences in invoicing for services and completion of
performance obligations are recognised as contract liabilities.
31
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
Interest
Interest revenue is recognised as interest accrues using the effective interest method. This is a method of calculating the
amortised cost of a financial asset and allocating the interest income over the relevant period using the effective interest
rate, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset
to the net carrying amount of the financial asset.
Other revenue
Other revenue is recognised when it is received or when the right to receive payment is established.
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.
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
consolidated entity'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 consolidated entity'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.
32
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
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 consolidated entity has applied the simplified approach to measuring expected credit losses, which uses a lifetime
expected loss allowance. To measure the expected credit losses, trade receivables have been grouped based on days
overdue.
Other receivables are recognised at amortised cost, less any allowance for expected credit losses.
Investments and other financial assets
Investments and other financial assets are initially measured at fair value. Transaction costs are included as part of the
initial measurement, except for financial assets at fair value through profit or loss. Such assets are subsequently measured
at either amortised cost or fair value depending on their classification. Classification is determined based on both the
business model within which such assets are held and the contractual cash flow characteristics of the financial asset
unless, an accounting mismatch is being avoided.
Financial assets are derecognised when the rights to receive cash flows have expired or have been transferred and the
consolidated entity has transferred substantially all the risks and rewards of ownership. When there is no reasonable
expectation of recovering part or all of a financial asset, it's carrying value is written off.
Financial assets at amortised cost
A financial asset is measured at amortised cost only if both of the following conditions are met: (i) it is held within a
business model whose objective is to hold assets in order to collect contractual cash flows; and (ii) the contractual terms of
the financial asset represent contractual cash flows that are solely payments of principal and interest.
Impairment of financial assets
The consolidated entity recognises a loss allowance for expected credit losses on financial assets which are either
measured at amortised cost or fair value through other comprehensive income. The measurement of the loss allowance
depends upon the consolidated entity's assessment at the end of each reporting period as to whether the financial
instrument's credit risk has increased significantly since initial recognition, based on reasonable and supportable
information that is available, without undue cost or effort to obtain.
Where there has not been a significant increase in exposure to credit risk since initial recognition, a 12-month expected
credit loss allowance is estimated. This represents a portion of the asset's lifetime expected credit losses that is attributable
to a default event that is possible within the next 12 months. Where a financial asset has become credit impaired or where
it is determined that credit risk has increased significantly, the loss allowance is based on the asset's lifetime expected
credit losses. The amount of expected credit loss recognised is measured on the basis of the probability weighted present
value of anticipated cash shortfalls over the life of the instrument discounted at the original effective interest rate.
For financial assets measured at fair value through other comprehensive income, the loss allowance is recognised within
other comprehensive income. In all other cases, the loss allowance is recognised in profit or loss.
Property, plant and equipment
Property, 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 straight-line basis to write off the net cost of each item of property, plant and equipment
(excluding land) over their expected useful lives as follows:
Computer equipment
2-5 years
The residual values, useful lives and depreciation methods are reviewed, and adjusted if appropriate, at each reporting
date.
Leasehold improvements and plant and equipment under lease are depreciated over the unexpired period of the lease or
the estimated useful life of the assets, whichever is shorter.
33
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
An item of property, plant and equipment is derecognised upon disposal or when there is no future economic benefit to the
consolidated entity. Gains and losses between the carrying amount and the disposal proceeds are taken to profit or loss.
Any revaluation surplus reserve relating to the item disposed of is transferred directly to retained profits.
An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater
than its estimated recoverable amount.
Leases
The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement and
requires an assessment of whether the fulfilment of the arrangement is dependent on the use of a specific asset or assets
and the arrangement conveys a right to use the asset.
A distinction is made between finance leases, which effectively transfer from the lessor to the lessee substantially all the
risks and benefits incidental to the ownership of leased assets, and operating leases, under which the lessor effectively
retains substantially all such risks and benefits.
Finance leases are capitalised. A lease asset and liability are established at the fair value of the leased assets, or if lower,
the present value of minimum lease payments. Lease payments are allocated between the principal component of the
lease liability and the finance costs, so as to achieve a constant rate of interest on the remaining balance of the liability.
Leased assets acquired under a finance lease are depreciated over the asset's useful life or over the shorter of the asset's
useful life and the lease term if there is no reasonable certainty that the consolidated entity will obtain ownership at the end
of the lease term.
Operating lease payments, net of any incentives received from the lessor, are charged to profit or loss on a straight-line
basis over the term of the lease.
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. Indefinite life intangible
assets are not amortised and are subsequently measured at cost less any impairment. 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.
Goodwill
Goodwill arises on the acquisition of a business and is carried at cost less accumulated impairment losses. Impairment
losses on goodwill are taken to profit or loss and are not subsequently reversed.
Computer software and development
Significant costs associated with computer software and development are deferred and amortised on a straight-line basis
over the period of their expected benefit and once the asset has been brought into use, being their finite life of 5 years.
Impairment of non-financial assets
Goodwill and other intangible assets that have an indefinite useful life are not subject to amortisation and are tested
annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired.
Other non-financial assets are reviewed for impairment whenever 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.
34
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
Trade and other payables
These amounts represent liabilities for goods and services provided to the consolidated entity 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.
Contract liabilities
Contract liabilities represent the consolidated entity's obligation to transfer goods or services to a customer and are
recognised when a customer pays consideration, or when the consolidated entity recognises a receivable to reflect its
unconditional right to consideration (whichever is earlier) before the consolidated entity has transferred the goods or
services to the customer.
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.
Where there is an unconditional right to defer settlement of the liability for at least 12 months after the reporting date, the
loans or borrowings are classified as non-current.
Loans and borrowings are removed from the statement of financial position when the obligation specified in the contract is
discharged, cancelled or expired. The difference between the carrying amount and any consideration paid is recognised in
profit or loss.
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.
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 using the projected unit credit method. 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 corporate bonds with terms to maturity and currency that match, as closely as possible, the
estimated future cash outflows.
Liabilities for employee entitlements which have vested in the employee at reporting date are recognised as current
liabilities notwithstanding that they are not expected to be settled within 12 months of reporting date as the consolidated
entity does not have an unconditional right to defer settlement.
Share-based payments
Equity-settled and cash-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 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 consolidated entity receives the services that entitle the employees to receive payment. No account is taken of
any other vesting conditions.
35
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
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.
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 consolidated entity or employee, the failure to satisfy the condition is
treated as a cancellation. If the condition is not within the control of the consolidated entity 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.
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.
Business combinations
The acquisition method of accounting is used to account for business combinations regardless of whether equity
instruments or other assets are acquired.
The consideration transferred is the sum of the acquisition-date fair values of the assets transferred, equity instruments
issued or liabilities incurred by the acquirer to former owners of the acquiree and the amount of any non-controlling interest
in the acquiree. For each business combination, the non-controlling interest in the acquiree is measured at either fair value
or at the proportionate share of the acquiree's identifiable net assets. All acquisition costs are expensed as incurred to
profit or loss.
36
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
On the acquisition of a business, the consolidated entity assesses the financial assets acquired and liabilities assumed for
appropriate classification and designation in accordance with the contractual terms, economic conditions, the consolidated
entity's operating or accounting policies and other pertinent conditions in existence at the acquisition-date.
Where the business combination is achieved in stages, the consolidated entity remeasures its previously held equity
interest in the acquiree at the acquisition-date fair value and the difference between the fair value and the previous carrying
amount is recognised in profit or loss.
Contingent consideration to be transferred by the acquirer is recognised at the acquisition-date fair value. Subsequent
changes in the fair value of the contingent consideration classified as an asset or liability is recognised in profit or loss.
Contingent consideration classified as equity is not remeasured and its subsequent settlement is accounted for within
equity.
The difference between the acquisition-date fair value of assets acquired, liabilities assumed and any non-controlling
interest in the acquiree and the fair value of the consideration transferred and the fair value of any pre-existing investment
in the acquiree is recognised as goodwill. If the consideration transferred and the pre-existing fair value is less than the fair
value of the identifiable net assets acquired, being a bargain purchase to the acquirer, the difference is recognised as a
gain directly in profit or loss by the acquirer on the acquisition-date, but only after a reassessment of the identification and
measurement of the net assets acquired, the non-controlling interest in the acquiree, if any, the consideration transferred
and the acquirer's previously held equity interest in the acquirer.
Business combinations are initially accounted for on a provisional basis. The acquirer retrospectively adjusts the
provisional amounts recognised and also recognises additional assets or liabilities during the measurement period, based
on new information obtained about the facts and circumstances that existed at the acquisition-date. The measurement
period ends on either the earlier of (i) 12 months from the date of the acquisition or (ii) when the acquirer receives all the
information possible to determine fair value.
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to the owners of Kyckr 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.
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.
37
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 2. Significant accounting policies (continued)
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 consolidated entity for the annual reporting period ended 30 June 2019.
The consolidated entity's assessment of the impact of these new or amended Accounting Standards and Interpretations,
most relevant to the consolidated entity, are set out below.
AASB 16 Leases
This standard is applicable to annual reporting periods beginning on or after 1 January 2019. The standard replaces AASB
117 'Leases' and for lessees will eliminate the classifications of operating leases and finance leases. Subject to exceptions,
a 'right-of-use' asset will be capitalised in the statement of financial position, measured at the present value of the
unavoidable future lease payments to be made over the lease term. The exceptions relate to short-term leases of 12
months or less and leases of low-value assets (such as personal computers and small office furniture) where an
accounting policy choice exists whereby either a 'right-of-use' asset is recognised or lease payments are expensed to profit
or loss as incurred. A liability corresponding to the capitalised lease will also be recognised, adjusted for lease
prepayments, lease incentives received, initial direct costs incurred and an estimate of any future restoration, removal or
dismantling costs. Straight-line operating lease expense recognition will be replaced with a depreciation charge for the
leased asset (included in operating costs) and an interest expense on the recognised lease liability (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 will be improved as the operating expense is replaced by interest expense and depreciation in profit
or loss under AASB 16. For classification within the statement of cash flows, the lease payments will be separated into
both a principal (financing activities) and interest (either operating or financing activities) component. For lessor accounting,
the standard does not substantially change how a lessor accounts for leases. The consolidated entity will adopt this
standard from 1 July 2019. The opening balances at 1 July 2019 for the lease assets will be in line with the lease
commitments disclosed in note 27.
New Conceptual Framework for Financial Reporting
A revised Conceptual Framework for Financial Reporting has been issued by the AASB and is applicable for annual
reporting periods beginning on or after 1 January 2020. This release impacts for-profit private sector entities that have
public accountability that are required by legislation to comply with Australian Accounting Standards and other for-profit
entities that voluntarily elect to apply the Conceptual Framework. Phase 2 of the framework is yet to be released which will
impact for-profit private sector entities. The application of new definition and recognition criteria as well as new guidance on
measurement will result in amendments to several accounting standards. The issue of AASB 2019-1 Amendments to
Australian Accounting Standards – References to the Conceptual Framework, also applicable from 1 January 2020,
includes such amendments. Where the consolidated entity has relied on the conceptual framework in determining its
accounting policies for transactions, events or conditions that are not otherwise dealt with under Australian Accounting
Standards, the consolidated entity may need to revisit such policies. The consolidated entity will apply the revised
conceptual framework from 1 July 2020 and is yet to assess its impact.
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.
Share-based payment transactions
The consolidated entity 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 the Black-Scholes
model which takes 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.
38
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 3. Critical accounting judgements, estimates and assumptions (continued)
Fair value measurement hierarchy
The consolidated entity is required to classify all assets and liabilities, measured at fair value, using a three level hierarchy,
based on the lowest level of input that is significant to the entire fair value measurement, being: Level 1: Quoted prices
(unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date; Level 2:
Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or
indirectly; and Level 3: Unobservable inputs for the asset or liability. Considerable judgement is required to determine what
is significant to fair value and therefore which category the asset or liability is placed in can be subjective.
The fair value of assets and liabilities classified as level 3 is determined by the use of valuation models. These include
discounted cash flow analysis or the use of observable inputs that require significant adjustments based on unobservable
inputs.
Estimation of useful lives of assets
The consolidated entity determines the estimated useful lives and related depreciation and amortisation charges for its
property, plant and equipment and finite life intangible assets. The useful lives could change significantly as a result of
technical innovations or some other event. The depreciation and amortisation charge will increase where the useful lives
are less than previously estimated lives, or technically obsolete or non-strategic assets that have been abandoned or sold
will be written off or written down.
Goodwill and other indefinite life intangible assets
The consolidated entity tests annually, or more frequently if events or changes in circumstances indicate impairment,
whether goodwill and other indefinite life intangible assets have suffered any impairment, in accordance with the
accounting policy stated in note 2. The recoverable amounts of cash-generating units have been determined based on
value-in-use calculations. 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.
Impairment of non-financial assets other than goodwill and other indefinite life intangible assets
The consolidated entity 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 consolidated entity 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.
Income tax
The consolidated entity is subject to income taxes in the jurisdictions in which it operates. Significant judgement is required
in determining the provision for income tax. There are many transactions and calculations undertaken during the ordinary
course of business for which the ultimate tax determination is uncertain. The consolidated entity recognises liabilities for
anticipated tax audit issues based on the consolidated entity's current understanding of the tax law. Where the final tax
outcome of these matters is different from the carrying amounts, such differences will impact the current and deferred tax
provisions in the period in which such determination is made.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences only if the consolidated entity considers it is
probable that future taxable amounts will be available to utilise those temporary differences and losses.
Employee benefits provision
As discussed in note 2, the liability for employee benefits expected to be settled more than 12 months from the reporting
date are recognised and measured at the present value of the estimated future cash flows to be made in respect of all
employees at the reporting date. In determining the present value of the liability, estimates of attrition rates and pay
increases through promotion and inflation have been taken into account.
Business combinations
As discussed in note 2, business combinations are initially accounted for on a provisional basis. The fair value of assets
acquired, liabilities and contingent liabilities assumed are initially estimated by the consolidated entity taking into
consideration all available information at the reporting date. Fair value adjustments on the finalisation of the business
combination accounting is retrospective, where applicable, to the period the combination occurred and may have an impact
on the assets and liabilities, depreciation and amortisation reported.
39
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 4. Operating segments
The Group operates in one operating segment, being the provision of Know Your Business customer ('KYB') services. The
operating segment identified is based on the internal reports that are reviewed and used by the Directors of the Board (who
are identified as the Chief Operating Decision Maker (‘CODM’) in assessing performance and in determining the allocation
of resources. There is no aggregation of operating segments.
The CODM reviews earnings before interest, tax, depreciation and amortisation ('EBITDA'). EBITDA is a financial measure
which is not prescribed by Australian Accounting Standards (‘AAS’) and represents the profit under AAS adjusted for non-
specific non-cash and significant items. The accounting policies adopted for internal reporting to the CODM are consistent
with those adopted in the financial statements.
The information reported to the CODM is on at least a monthly basis.
Major customers
During the year ended 30 June 2019 approximately 36% (2018: 29%) of the consolidated entity's external revenue was
derived from sales to 3 customers (2018: 1 customers).
Geographical information
Australia
Ireland
Sales to external customers
Geographical non-current
assets
2019
$
2018
$
2019
$
2018
$
-
2,138,671
-
1,724,409
8,452,328
1,224,079
12,255,891
365,982
2,138,671
1,724,409
9,676,407
12,621,873
A reconciliation of the loss after income tax expense to EBITDA is as follows:
Consolidated
2019
$
2018
$
(6,125,773)
62,655
3,801,663
(84,556)
13,134
(3,547,445)
56,738
-
(42,611)
37,322
(2,332,877)
(3,495,996)
Consolidated
2019
$
2018
$
2,138,671
1,724,409
Loss after tax
add: depreciation and amortisation
add: impairment of goodwill
Less: interest revenue
add: finance costs
EBITDA
Note 5. Revenue
Sales of services
40
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 5. Revenue (continued)
Disaggregation of revenue
The disaggregation of revenue from contracts with customers is as follows:
Major product lines
Online revenue
Enterprise revenue
Consolidated
2019
$
2018
$
1,487,492
651,179
1,021,223
703,186
2,138,671
1,724,409
Refer to note 4 'Operating segments' for analysis of revenue by geographical region.
During the financial year ended 30 June 2019 and 30 June 2018, all revenue was recognised based on services provided
at a point in time.
Note 6. Other income
Net fair value gain on financial liability (refer to note 17)
1,871,855
513,644
Consolidated
2019
$
2018
$
41
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 7. Expenses
Loss before income tax includes the following specific expenses:
Depreciation
Computer equipment
Amortisation
Computer software and development
Total depreciation and amortisation
Impairment
Goodwill
Finance costs
Interest and finance charges paid/payable
Unwinding of the discount on contingent consideration (refer to note 17)
Finance costs expensed
Net foreign exchange loss
Net foreign exchange loss
Rental expense relating to operating leases
Minimum lease payments
Share-based payments expense
Share-based payments expense
Employee benefits expense
Employee benefits expense excluding superannuation
Defined contribution superannuation expense
Total employee benefits expense
Consolidated
2019
$
2018
$
32,811
16,361
29,844
40,377
62,655
56,738
3,801,663
-
6,779
6,355
-
37,322
13,134
37,322
5,050
4,944
140,859
130,970
534,996
337,763
2,918,590
46,282
2,942,401
56,822
2,964,872
2,999,223
42
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 8. Income tax expense
Numerical reconciliation of income tax expense and tax at the statutory rate
Loss before income tax expense
Tax at the statutory tax rate of 27.5%
Tax effect amounts which are not deductible/(taxable) in calculating taxable income:
Non-deductible expenses
Non-assessable income
Capital deductions
Current year tax losses not recognised
Difference in overseas tax rates
Income tax expense
Deferred tax assets not recognised
Deferred tax assets not recognised comprises temporary differences attributable to:
Carried forward tax losses benefit
Temporary differences
Total deferred tax assets not recognised
Consolidated
2019
$
2018
$
(6,125,773)
(3,547,445)
(1,684,588)
(975,547)
1,193,363
(514,760)
(24,873)
103,812
(141,252)
(100,552)
(1,030,858)
684,750
346,108
(1,113,539)
798,850
314,689
-
-
Consolidated
2019
$
2018
$
2,437,755
34,618
1,905,895
43,003
2,472,373
1,948,898
The above potential tax benefit, which includes tax losses and temporary differences has not been recognised in the
statement of financial position as recovery of this benefit is not probable. There is no expiration date for the tax losses
carried forward. The estimated amount of cumulative tax losses at 30 June 2019 was $12,981,159 (2018: $9,794,107).
Utilisation of these tax losses is dependent on the company satisfying certain tests at the time the losses are recouped.
Note 9. Current assets - cash and cash equivalents
Cash at bank
Consolidated
2019
$
2018
$
1,448,660
4,575,703
43
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 10. Current assets - trade and other receivables
Trade receivables
Less: Allowance for expected credit losses
Other receivables
GST receivable
Consolidated
2019
$
2018
$
240,681
(3,241)
237,440
60,351
120,495
305,689
(8,512)
297,177
39,028
30,407
418,286
366,612
Allowance for expected credit losses
The consolidated entity has recognised a loss of $83,925 (2018: a gain of $7,026) in profit or loss in respect of impairment
of receivables for the year ended 30 June 2019.
The ageing of the receivables and allowance for expected credit losses provided for above are as follows:
Consolidated
Not overdue
0 to 3 months overdue
3 to 6 months overdue
Over 6 months overdue
Movements in the allowance for expected credit losses are as follows:
Opening balance
Additional provisions recognised
Receivables written off during the year as uncollectable
Closing balance
Note 11. Current assets - other
Prepayments
Security deposits
44
Expected
credit loss
rate
2019
%
Carrying
amount
2019
$
Allowance
for expected
credit losses
2019
$
-
-
-
26.19%
110,374
106,424
11,508
12,375
240,681
-
-
-
3,241
3,241
Consolidated
2019
$
2018
$
8,512
83,925
(89,196)
1,486
7,026
-
3,241
8,512
Consolidated
2019
$
2018
$
158,729
16,205
108,378
15,763
174,934
124,141
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 12. Non-current assets - property, plant and equipment
Computer equipment - at cost
Less: Accumulated depreciation
Consolidated
2019
$
2018
$
104,616
(55,581)
79,440
(22,770)
49,035
56,670
Reconciliations
Reconciliations of the written down values at the beginning and end of the current and previous financial year are set out
below:
Computer
equipment
$
Total
$
26,259
45,728
1,044
(16,361)
56,670
24,217
959
(32,811)
26,259
45,728
1,044
(16,361)
56,670
24,217
959
(32,811)
49,035
49,035
Consolidated
2019
$
2018
$
12,250,079
(3,801,663)
8,448,416
12,250,079
-
12,250,079
1,292,552
(113,596)
1,178,956
398,876
(83,752)
315,124
9,627,372
12,565,203
Consolidated
Balance at 1 July 2017
Additions
Exchange differences
Depreciation expense
Balance at 30 June 2018
Additions
Exchange differences
Depreciation expense
Balance at 30 June 2019
Note 13. Non-current assets - intangibles
Goodwill - at cost
Less: Impairment
Computer software and development - at cost
Less: Accumulated amortisation
45
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 13. 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 2017
Additions
Exchange differences
Amortisation expense
Balance at 30 June 2018
Additions
Exchange differences
Impairment of assets
Amortisation expense
Balance at 30 June 2019
Computer
software and
development
$
70,938
281,239
3,324
(40,377)
315,124
885,321
8,355
-
(29,844)
Goodwill
$
12,250,079
-
-
-
12,250,079
-
-
(3,801,663)
-
Total
$
12,321,017
281,239
3,324
(40,377)
12,565,203
885,321
8,355
(3,801,663)
(29,844)
8,448,416
1,178,956
9,627,372
Impairment testing
For the purpose of impairment testing, goodwill is allocated to the one cash generating unit ('CGU'), Kyckr Ireland Limited.
Key assumptions used for value-in-use calculations:
The Group tests whether goodwill has suffered any impairment on at least an annual basis. The recoverable amount of a
CGU is determined based on value-in-use calculations which require the use of assumptions. The calculations use cash
flow projections based on financial budgets approved by the Board of Directors covering a two year period. Estimated
growth rates and other reasonable assumptions are utilised to further calculate cash flows out to five years from balance
date. Cash flows beyond the five year period are extrapolated into perpetuity using estimated terminal growth rates shown
below. The following table sets out the key assumptions used for value-in-use calculations:
● Two to five year growth rates 30% (2018: 30%)
● Long term growth rate 5% (2018: 5%)
● Weighted average cost of capital 15% (2018: 15%)
Impairment charge:
Based on the value-in-use calculation methodology and assumptions stated above, the carrying amount the CGU exceeds
its recoverable amount and an impairment of $3,801,663 has been recognised.
Impact of possible changes in assumptions:
A reasonable possible change in the key assumptions would not result in any additional impairment to the CGU.
Note 14. Current liabilities - trade and other payables
Trade payables
Accrued expenses
Other payables
Refer to note 22 for further information on financial instruments.
46
Consolidated
2019
$
2018
$
395,289
273,130
170,795
517,913
262,427
50,959
839,214
831,299
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 15. Current liabilities - contract liabilities
Contract liabilities
Deferred revenue
Consolidated
2019
$
2018
$
158,000
-
-
69,800
158,000
69,800
Deferred revenue has been reclassified to contract liabilities at 1 July 2018 following the adoption of AASB 15 'Revenue
from Contracts with Customers'.
Reconciliation
Reconciliation of the written down values at the beginning and end of the current and previous financial year are set out
below:
Opening balance
Payments received in advance
Transfer to revenue
Closing balance
Consolidated
2019
$
69,800
494,254
(406,054)
158,000
Unsatisfied performance obligations
The aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied at the end of
the reporting period was $158,000 as at 30 June 2019 ($69,800 as at 30 June 2018) and is expected to be recognised as
revenue in future periods as follows:
Within 6 months
Note 16. Current liabilities - borrowings
Consolidated
2019
$
2018
$
158,000
69,800
Consolidated
2019
$
2018
$
Interest bearing liability - insurance premium funding
54,348
-
Refer to note 22 for further information on financial instruments.
Note 17. Current liabilities - contingent consideration
Contingent consideration
Consolidated
2019
$
2018
$
214,500
2,080,000
47
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 17. Current liabilities - contingent consideration (continued)
Contingent consideration
Contingent consideration relates to the acquisition of Kyckr Ireland Limited on 1 September 2016 and represents
13,000,000 Performance Shares that were issued which will convert to fully paid ordinary shares on a one-for-one basis
upon meeting the following vesting conditions:
●
●
50% of the performance shares automatically convert upon the Company achieving a turnover of $5 million or more
as set out in the full year or half-yearly financial statements released to the ASX; and
50% of the performance shares automatically convert upon the Company achieving a turnover of $10 million or more
as set out in its yearly or half-yearly financial statements released to the ASX.
The performance shares expire four years from the date of acquisition in the event that the above vesting conditions are
not met.
As the contingent consideration vests no earlier than two years from the date of issue, the amount has been discounted by
the two-year government bond rate of 1.46% p.a. The finance costs incurred during the period with respect to the
unwinding of the discount was $6,355 (2018: $37,322) and is included in finance costs, which in addition to a fair value
movement of $1,871,855 (2018: $513,644) gives a balance at 30 June 2019 of $214,500 (2018: $2,080,000).
Note 18. Non-current liabilities - employee benefits
Long service leave
Note 19. Equity - issued capital
Consolidated
2019
$
2018
$
7,079
-
Consolidated
2019
Shares
2018
Shares
2019
$
2018
$
Ordinary shares - fully paid
150,964,890
140,908,619
21,798,633
20,477,340
Movements in ordinary share capital
Details
Date
Shares
Issue price
$
Balance
Share placement
Share placement
less share issue costs (net of taxation)
Balance
Share placement
less share issue costs (net of taxation)
1 July 2017
17 October 2017
27 June 2018
30 June 2018
10 August 2018
100,962,186
11,764,710
28,181,723
-
140,908,619
10,056,271
-
Balance
30 June 2019
150,964,890
$0.17
$0.14
$0.00
$0.14
$0.00
14,897,543
2,000,000
3,945,441
(365,644)
20,477,340
1,407,878
(86,585)
21,798,633
48
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 20. Equity - reserves
Foreign currency reserve
Share-based payments reserve
Consolidated
2019
$
2018
$
7,534
2,469,808
6,725
1,934,812
2,477,342
1,941,537
Foreign currency reserve
The reserve is used to recognise exchange differences arising from the translation of the financial statements of foreign
operations to Australian dollars.
Share-based payments reserve
The reserve is used to recognise the value of equity benefits provided to employees and directors as part of their
remuneration, and other parties as part of their compensation for services.
Movements in reserves
Movements in each class of reserve during the current and previous financial year are set out below:
Consolidated
Balance at 1 July 2017
Foreign currency translation
Share-based payments
Balance at 30 June 2018
Foreign currency translation
Share-based payments
Balance at 30 June 2019
Note 21. Equity - dividends
Foreign
currency
$
Share-based
payments
$
(26,091)
32,816
-
6,725
809
-
1,597,049
-
337,763
1,934,812
-
534,996
Total
$
1,570,958
32,816
337,763
1,941,537
809
534,996
7,534
2,469,808
2,477,342
There were no dividends paid, recommended or declared during the current or previous financial year.
Note 22. Financial instruments
Financial risk management objectives
The consolidated entity's activities expose it to a variety of financial risks: market risk (including foreign currency risk, price
risk and interest rate risk), credit risk and liquidity risk. The consolidated entity'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 consolidated entity. The consolidated entity may use derivative financial instruments such as forward foreign exchange
contracts to hedge certain risk exposures, however as at 30 June 2019 and 30 June 2018 there were no derivative
financial instruments in place. The consolidated entity 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
and ageing analysis for credit 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 consolidated entity and
appropriate procedures, controls and risk limits. Finance identifies and evaluates financial risks within the consolidated
entity's operating units. Finance reports to the Board on a monthly basis.
49
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 22. Financial instruments (continued)
Market risk
Foreign currency risk
The consolidated entity undertakes certain transactions denominated in foreign currency and is exposed to foreign
currency risk through foreign exchange rate fluctuations.
Foreign exchange risk arises from future commercial transactions and recognised financial assets and financial liabilities
denominated in a currency that is not the entity's functional currency. The risk is measured using sensitivity analysis and
cash flow forecasting.
The consolidated entity's foreign exchange risk is managed to ensure sufficient funds are available to meet foreign
denominated financial commitments in a timely and cost-effective manner. The consolidated entity will continually monitor
this risk and consider entering into forward foreign exchange, foreign currency swap and foreign currency option contracts
if appropriate.
Creditors and debtors as at 30 June 2019 were reviewed to assess currency risk at year end. The value of transactions
denominated in a currency other than the functional currency of the respective subsidiary was insignificant and therefore
the risk was determined as not being significant.
At 30 June 2019, the carrying value of foreign currency denominated cash and cash equivalents are as follows:
Consolidated
US dollars
Euros
Pound Sterling
Assets
Liabilities
2019
$
2018
$
2019
$
2018
$
22,589
69,718
20,488
5,719
229,171
6,596
112,795
241,486
-
-
-
-
-
-
-
-
The consolidated entity had cash denominated in foreign currencies of $112,795 as at 30 June 2019 (30 June 2018:
$241,486). Based on this exposure, had the Australian dollar weakened by 10%/strengthened by 10% (30 June 2018:
weakened by 10%/strengthened by 10%) against these foreign currencies with all other variables held constant, the
consolidated entity's profit after tax for the year would have been $11,280 higher/$11,280 lower (30 June 2018: $24,149
higher/$24,149 lower). The percentage change is the expected overall volatility of the significant currencies, based on
management's assessment of reasonable possible fluctuations.
Price risk
The consolidated entity is not exposed to any significant price risk.
Interest rate risk
The consolidated entity is not exposed to any interest rate risk.
Credit risk
The consolidated entity 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 consolidated entity 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.
50
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 22. Financial instruments (continued)
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
consolidated entity. The consolidated entity has a strict code of credit, including obtaining agency credit information,
confirming references and setting appropriate credit limits.
The consolidated entity has no significant credit risk exposure and the maximum exposure 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 consolidated entity does not hold any collateral.
Liquidity risk
Vigilant liquidity risk management requires the consolidated entity to maintain sufficient liquid assets (mainly cash and cash
equivalents) to be able to pay debts as and when they become due and payable.
The consolidated entity manages liquidity risk by maintaining adequate cash reserves 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 consolidated entity'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 - 2019
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Contingent consideration
Interest-bearing - fixed rate
Borrowing
Total non-derivatives
Consolidated - 2018
Non-derivatives
Non-interest bearing
Trade payables
Other payables
Contingent consideration
Total non-derivatives
Weighted
average
interest rate 1 year or less
%
$
Between 1
and 2 years
$
Between 2
and 5 years Over 5 years
$
$
-
-
-
7.90%
395,289
170,795
214,500
54,348
834,932
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Weighted
average
interest rate 1 year or less
%
$
Between 1
and 2 years
$
Between 2
and 5 years Over 5 years
$
$
Remaining
contractual
maturities
$
395,289
170,795
214,500
54,348
834,932
Remaining
contractual
maturities
$
-
-
-
517,913
50,959
2,080,000
2,648,872
-
-
-
-
-
-
-
-
-
-
-
-
517,913
50,959
2,080,000
2,648,872
The cash flows in the maturity analysis above are not expected to occur significantly earlier than contractually disclosed
above.
Fair value of financial instruments
Unless otherwise stated, the carrying amounts of financial instruments reflect their fair value.
51
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 23. Fair value measurement
Fair value hierarchy
The following tables detail the consolidated entity's assets and liabilities, measured or disclosed at fair value, using a three
level hierarchy, based on the lowest level of input that is significant to the entire fair value measurement, being:
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the
measurement date
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
or indirectly
Level 3: Unobservable inputs for the asset or liability
Consolidated - 2019
Liabilities
Contingent consideration
Total liabilities
Consolidated - 2018
Liabilities
Contingent consideration
Total liabilities
Level 1
$
Level 2
$
Level 3
$
Total
$
Level 1
$
-
-
-
-
Level 2
$
-
-
-
-
214,500
214,500
214,500
214,500
Level 3
$
Total
$
2,080,000
2,080,000
2,080,000
2,080,000
There were no transfers between levels during the financial year.
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 the contingent consideration is estimated using a discounted cash flow model and is based on the
probability of meeting all of the vesting conditions under the terms of the Kyckr (Ireland) Share Purchase Agreement.
Valuation techniques for fair value measurements categorised within level 2 and level 3
The fair value of the contingent consideration is estimated based on a probability of meeting all of the vesting conditions
relating to these shares under the terms of the Share Purchase Agreement.
Level 3 assets and liabilities
Movements in level 3 assets and liabilities during the current and previous financial year are set out below:
Consolidated
Balance at 1 July 2017
Gains recognised in profit or loss
Unwinding of the discount*
Balance at 30 June 2018
Gains recognised in profit or loss
Unwinding of the discount*
Balance at 30 June 2019
Contingent
consideration
$
Total
$
2,556,322
(513,644)
37,322
2,556,322
(513,644)
37,322
2,080,000
(1,871,855)
6,355
2,080,000
(1,871,855)
6,355
214,500
214,500
*
Included as part of finance costs in the Statement of profit or loss and other comprehensive income
52
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 23. Fair value measurement (continued)
The level 3 assets and liabilities unobservable inputs and sensitivity are as follows:
Description
Unobservable inputs
Range
(weighted average)
Sensitivity
Contingent
consideration
Discount rate
1.46%
0.25% change would increase/decrease fair
value by $1,070
Note 24. Key management personnel disclosures
Compensation
The aggregate compensation made to directors and other members of key management personnel of the consolidated
entity is set out below:
Short-term employee benefits
Post-employment benefits
Long-term benefits
Share-based payments
Note 25. Remuneration of auditors
Consolidated
2019
$
2018
$
799,543
29,934
2,792
350,928
944,543
46,892
1,422
137,105
1,183,197
1,129,962
During the financial year the following fees were paid or payable for services provided by Nexia Sydney Partnership, the
auditor of the company:
Audit services - Nexia Sydney Partnership
Audit or review of the financial statements
Note 26. Contingent liabilities
The consolidated entity has no contingent liabilities at 30 June 2019 and 30 June 2018.
Note 27. Commitments
Lease commitments - operating
Committed at the reporting date but not recognised as liabilities, payable:
Within one year
One to five years
Consolidated
2019
$
2018
$
35,000
35,000
Consolidated
2019
$
2018
$
118,522
71,113
189,635
-
-
-
Operating lease commitments includes contracted amounts for properties under non-cancellable operating leases expiring
within 1 to 2 years with, in some cases, options to extend. The leases have various escalation clauses. On renewal, the
terms of the leases are renegotiated.
53
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 28. Related party transactions
Parent entity
Kyckr Limited is the parent entity.
Subsidiaries
Interests in subsidiaries are set out in note 30.
Key management personnel
Disclosures relating to key management personnel are set out in note 24 and the remuneration report included in the
directors' report.
Transactions with related parties
The following transactions occurred with related parties:
Payment for goods and services:
Payment for services from director related entity
Payment for services from Director related entity comprise of:
Consolidated
2019
$
2018
$
-
27,502
●
expenses for investor relations services from Barton Place Pty Ltd (director-related entity of Albert Wong) of $Nil
(2018: $27,502). All transactions were made on normal commercial terms and conditions and were at market rates.
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
There were no loans to or from related parties at the current and previous reporting date.
Terms and conditions
All transactions were made on normal commercial terms and conditions and at market rates.
Note 29. Parent entity information
Set out below is the supplementary information about the parent entity.
Statement of profit or loss and other comprehensive income
Profit/(loss) after income tax
Total comprehensive income
Parent
2019
$
2018
$
222,837
(1,286,404)
222,837
(1,286,404)
54
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 29. Parent entity information (continued)
Statement of financial position
Total current assets
Total assets
Total current liabilities
Total liabilities
Equity
Issued capital
Share-based payments reserve
Accumulated losses
Total equity
Parent
2019
$
2018
$
8,505,132
8,286,833
20,294,257
20,077,856
458,784
2,328,588
465,863
2,328,588
21,798,633
2,469,808
(4,440,047)
20,477,340
1,934,812
(4,662,884)
19,828,394
17,749,268
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 2019 and 30 June 2018.
Contingent liabilities
The parent entity had no contingent liabilities as at 30 June 2019 and 30 June 2018.
Capital commitments - Property, plant and equipment
The parent entity had no capital commitments for property, plant and equipment as at 30 June 2019 and 30 June 2018.
Significant accounting policies
The accounting policies of the parent entity are consistent with those of the consolidated entity, 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.
Note 30. 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
Kyckr Ireland Limited
Kyckr UK Limited
Principal place of business /
Country of incorporation
Ireland
UK
Ownership interest
2018
2019
%
%
100.00%
100.00%
100.00%
-
55
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 31. Reconciliation of loss after income tax to net cash used in operating activities
Loss after income tax expense for the year
(6,125,773)
(3,547,445)
Consolidated
2019
$
2018
$
Adjustments for:
Depreciation and amortisation
Impairment of goodwill
Share-based payments
Foreign exchange differences
Non-cash finance costs
Fair value gain on contingent consideration
Change in operating assets and liabilities:
Increase in trade and other receivables
Increase in prepayments
Increase in trade and other payables
Increase in contract liabilities
Increase/(decrease) in employee benefits
62,655
3,801,663
534,996
(8,505)
6,355
(1,871,855)
(52,116)
(50,351)
7,915
88,200
13,670
56,738
-
337,763
35,974
37,322
(513,644)
(186,830)
(7,110)
420,373
37,636
(11,237)
Net cash used in operating activities
(3,593,146)
(3,340,460)
Note 32. Earnings per share
Consolidated
2019
$
2018
$
Loss after income tax attributable to the owners of Kyckr Limited
(6,125,773)
(3,547,445)
Weighted average number of ordinary shares used in calculating basic earnings per share
149,859,806
109,445,229
Weighted average number of ordinary shares used in calculating diluted earnings per share
149,859,806
109,445,229
Number
Number
Basic earnings per share
Diluted earnings per share
Cents
Cents
(4.09)
(4.09)
(3.24)
(3.24)
For the purpose calculating the diluted earnings per share the calculation has excluded the number of options as the effect
would be anti-dilutive.
56
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 33. Share-based payments
The following options and performance rights were issued during the years ended 30 June 2019, 30 June 2018 and 30
June 2017:
●
On 1 September 2016, 4,000,000 unlisted options were granted to brokers associated with the Initial Public Offering
('IPO') of the company. The exercise price of the options of $0.20 was equal to the IPO price. The contractual life of
each option is four years.
On 1 September 2016, 4,000,000 unlisted options were granted to Key Management Personnel. The exercise price of
the options of $0.30 was 50% higher than the Initial Public Offering price. The options are exercisable upon meeting
certain revenue targets within four years from the date of grant. The contractual life of each option is four years.
On 1 September 2016, 20,000,000 performance rights were granted to certain Directors and key management
personnel. The performance rights are exercisable at Nil value. 50% of the performance rights automatically convert
upon the company achieving a turnover of $5 million or more as set out in the full year or half-yearly financial
statements released to the ASX; and 5% of the Performance rights automatically convert upon the company achieving
a turnover of $10 million or more as set out in its yearly or half-yearly financial statements released to the ASX. The
contractual life of each performance right is four years.
On 30 November 2016, 2,000,000 unlisted options exercisable at $0.30 were granted to senior executives under the
Long Term Incentive Plan approved by shareholders at the Annual General Meeting held on 30 November 2016. The
exercise price of the options of $0.30 was 22.45% higher than market price of the shares on the date of grant. The
vesting of these options is conditional on continued employment until the vesting date, being two years from grant
date. The contractual life of each option is four years.
On 30 November 2016, 3,000,000 unlisted options exercisable at $0.30 were granted to non-executive directors as
approved by shareholders at the Annual General Meeting held on 30 November 2016. The exercise price of the
options of $0.30 was 22.45% higher than market price of the shares on the date of grant.
On 2 January 2018, 2,000,000 unlisted options exercisable at $0.30 were granted to senior executives under the Long
Term Incentive Plan approved by shareholders at the Annual General Meeting held on 30 November 2016. The
exercise price of the options of $0.30 was 42.86% higher than the market price of the shares on the date of grant. The
vesting of these options is conditional on continued employment until the vesting date, being 1 November 2019.
On 10 August 2018, 1,000,000 unlisted options were granted to Benny Higgins, a director of the company. The
exercise price of the options of $0.20 was 48% higher than the market price of the shares on the date of grant. The
options vested immediately and the contractual life of each option is four years.
On 10 August 2018, 1,000,000 unlisted options were granted to Benny Higgins, a director of the company. The
exercise price of the options of $0.26 was 93% higher than the market price of the shares on the date of grant. The
options vest on 1 March 2019 and the contractual life of each option is four years.
On 10 August 2018, 1,000,000 unlisted options were granted to other management personnel. The exercise price of
the options of $0.30 was 122% higher than the market price of the share at the date of the grant. The vesting of these
options is conditional on continued employment until the vesting date, being 18 months from grant date. The
contractual life of each option is four years.
On 17 November 2018, the Board of Directors waived the employment condition attaching to performance rights
issued to Mr Albert Wong who resigned as a Director of the company. Vesting conditions relating to the turnover of
the Company remain with these rights and remain unvested as at 30 June 2019.
On 3 December 2018, 1,500,000 unlisted options were granted to other management personnel. The exercise price of
the options of $0.129 was 50% higher than the market price of the shares on the date of grant. The vesting of these
options is conditional on continued employment until the vesting date, being 3 years from grant date. The contractual
life of each option is four years.
On 1 January 2019, 3,000,000 unlisted options were granted to Ian Henderson, the Chief Executive Officer of the
company. The options are exercisable at $0.1005 expiring 1 January 2023 under the terms of the Long Term
Incentive Plan approved by shareholders at the Annual General Meeting held on 30 November 2016. The vesting of
these options is conditional on continued employment until the vesting date, being three year from grant date. The
exercise price of $0.1005 was 50% higher than the market price of the shares on the date of grant.
On 1 January 2019, 5,391,063 unlisted performance rights were granted to Ian Henderson in lieu of the first year’s
cash salary of £210,000. The performance rights have service-based vesting conditions only. The vesting date is 1
January 2020, expiring 1 April 2020. Once the vesting conditions are met, the performance rights will be exercisable
at nil cost.
●
●
●
●
●
●
●
●
●
●
●
●
57
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 33. Share-based payments (continued)
Set out below are summaries of options granted under the plan:
2019
Grant date
Expiry date
Exercise
price
01/01/2019
03/12/2018
10/08/2018
10/08/2018
10/08/2018
02/01/2018
30/11/2016
30/11/2016
01/09/2016
01/09/2016
01/01/2023
03/12/2022
10/08/2022
10/08/2022
10/08/2022
02/01/2022
30/11/2020
30/11/2020
01/09/2020
01/09/2020
$0.10
$0.13
$0.20
$0.26
$0.30
$0.30
$0.30
$0.30
$0.30
$0.20
Balance at
the start of
the year
-
-
-
-
-
2,000,000
2,722,222
2,000,000
4,000,000
4,000,000
14,722,222
Granted
Exercised
3,000,000
1,500,000
1,000,000
1,000,000
1,000,000
-
-
-
-
-
7,500,000
Expired/
forfeited/
other
Balance at
the end of
the year
-
(1,500,000)
-
-
(1,000,000)
-
-
-
-
-
(2,500,000)
3,000,000
-
1,000,000
1,000,000
-
2,000,000
2,722,222
2,000,000
4,000,000
4,000,000
19,722,222
-
-
-
-
-
-
-
-
-
-
-
Weighted average exercise price
$0.27
$0.17
$0.00
$0.00
$0.24
2018
Grant date
Expiry date
02/01/2018
30/11/2016
30/11/2016
01/09/2016
01/09/2016
02/01/2022
30/11/2020
30/11/2020
01/09/2020
01/09/2020
Exercise
price
$0.30
$0.30
$0.30
$0.30
$0.20
Balance at
the start of
the year
-
3,000,000
2,000,000
4,000,000
4,000,000
13,000,000
Granted
Exercised
2,000,000
-
-
-
-
2,000,000
Expired/
forfeited/
other
Balance at
the end of
the year
-
-
-
-
-
-
-
(277,778)
-
-
-
(277,778)
2,000,000
2,722,222
2,000,000
4,000,000
4,000,000
14,722,222
Weighted average exercise price
$0.27
$0.30
$0.00
$0.30
$0.27
Set out below are the options exercisable at the end of the financial year:
Grant date
Expiry date
10/08/2018
30/11/2016
01/09/2016
10/08/2022
30/11/2020
01/09/2020
2019
Number
2018
Number
2,000,000
2,722,222
4,000,000
-
2,722,222
4,000,000
8,722,222
6,722,222
The weighted average share price during the financial year was $0.0757.
The weighted average remaining contractual life of options outstanding at the end of the financial year was 2.08 years
(2018: 2.44 years).
58
Kyckr Limited
Notes to the financial statements
30 June 2019
Note 33. Share-based payments (continued)
Set out below are summaries of performance rights granted under the plan:
2019
Grant date
Expiry date
01/09/2016
01/01/2019
01/09/2020
01/04/2020
2018
Exercise
price
Balance at
the start of
the year
Granted
Exercised
Expired/
forfeited/
other
Balance at
the end of
the year
$0.00
$0.00
7,000,000
-
7,000,000
-
5,391,063
5,391,063
Grant date
Expiry date
Exercise
price
01/09/2016
01/09/2020
$0.00
Balance at
the start of
the year
7,000,000
7,000,000
Granted
Exercised
-
-
No performance rights are exercisable at the end of the year.
-
-
-
-
-
-
-
-
-
-
7,000,000
5,391,063
12,391,063
Balance at
the end of
the year
7,000,000
7,000,000
Expired/
forfeited/
other
The weighted average remaining contractual life of performance rights outstanding at the end of the financial year was 0.99
years (2018: 2.18 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
10/08/2018
10/08/2018
10/08/2018
03/12/2018
01/01/2019
10/08/2022
10/08/2022
10/08/2022
03/12/2022
01/01/2023
Share price
at grant date
Exercise
price
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant date
$0.14
$0.14
$0.14
$0.09
$0.07
$0.20
$0.26
$0.30
$0.13
$0.10
89.22%
89.22%
89.22%
99.57%
96.28%
-
-
-
-
-
2.32%
2.32%
2.32%
2.27%
1.99%
$0.08
$0.07
$0.07
$0.05
$0.04
For the performance rights 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
Expected
volatility
Dividend
yield
Risk-free
interest rate
Fair value
at grant date
01/01/2019
01/04/2020
$0.07
96.28%
-
1.99%
$0.07
Note 34. Events after the reporting period
On 7 August 2019, the company issued 32,350,159 ordinary shares at a price of $0.066 per share to institutional and
sophisticated investors. The total proceeds from the issuance of these securities amounted to $2,135,110.
On 13 September 2019, shareholders ratified the issue of securities at the Extraordinary General Meeting. In accordance
with the approval by shareholders, the company issued 46,000,000 ordinary shares at a price of $0.066 per share to
institutional and sophisticated investors. The total proceeds of the issuance of these securities amounted to $3,036,000.
No other matter or circumstance has arisen since 30 June 2019 that has significantly affected, or may significantly affect
the consolidated entity's operations, the results of those operations, or the consolidated entity's state of affairs in future
financial years.
59
Kyckr Limited
Directors' declaration
30 June 2019
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 consolidated entity's financial position as
at 30 June 2019 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
___________________________
Benny Higgins
Chairman
27 September 2019
Sydney
___________________________
John Van Der Wielen
Director
60
Independent Auditor’s Report to the Members of Kyckr Limited
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of Kyckr Limited (the Company and its subsidiaries (the Group)),
which comprises the consolidated statement of financial position as at 30 June 2019, the consolidated
statement of comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
i) giving a true and fair view of the Group’s financial position as at 30 June 2019 and of its financial
performance for the year then ended; and
ii) complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the ‘auditor’s responsibilities for the audit of the financial report’ section
of our report. We are independent of the Group in accordance with the Corporations Act 2001 and the
ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of
Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which has been
given to the directors of the Company, would be in the same terms if given to the directors as at the time
of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current period. These matters were addressed in the context of our
audit of the financial report as a whole, and in forming our opinion thereon, and we do not provide a
separate opinion on these matters.
61
Key audit matter
How our audit addressed the key audit matter
Recoverability of goodwill
Our procedures included, amongst others:
Refer to note 13
We evaluated management’s process for developing the cash
The carrying value of the Group’s
intangible assets included goodwill
of $8,448,416 arising from the
acquisition of Kyckr Ireland during
the 2017 financial year.
The assessment of recoverability
of the goodwill required a
significant degree of management
judgement given the short trading
history of the Group, the early
lifecycle stage, and the inherent
uncertainties in the key
assumptions used in the
assessment of future cash flows in
particular revenues, earnings
before interest and the discount
rate.
flow forecasts;
We tested the mathematical accuracy of the underlying ‘value-
in-use’ calculations;
We assessed and challenged the appropriateness of the inputs
into management’s calculations as follows:
- Comparing and calculating revenue and expense cash flows
with historical performance and new business avenues
announced to the market;
- Comparing the forecasted cash flows estimated in prior
periods to financial performance during the current financial
year;
- Comparing growth rates with the performance of other IT
start-ups;
- Recalculating the discount rate using the most current risk
free rates, market alpha, beta and risk premium estimates;
We performed sensitivity calculations for changes to the key
inputs to management’s model;
We compared the net assets of the Group to the Group’s market
capitalisation during the 3 months post year-end, including
consideration of the factors impacting the share price and
activities undertaken by the group.
Other information
The directors are responsible for the other information. The other information comprises the information
in Kyckr Limited’s annual report for the year ended 30 June 2019, but does not include the financial report
and the auditor’s report thereon.
Our opinion on the financial report does not cover the other information and we do not express any form
of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the financial report or
our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of the other
information we are required to report that fact. We have nothing to report in this regard.
Directors’ responsibility for the financial report
The directors of the Company are responsible for the preparation of the financial report that gives a true
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
such internal control as the directors determine is necessary to enable the preparation of the financial
report that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
62
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 responsibility 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 Australian
Auditing and Assurance Standards Board website at: www.auasb.gov.au/auditors_files/ar1.pdf. This
description forms part of our auditor’s report.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 14 to 22 of the directors’ Report for the year
ended 30 June 2019.
In our opinion, the Remuneration Report of Kyckr Limited for the year ended 30 June 2019, 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.
Nexia Sydney Partnership
Lester Wills
Partner
Dated: 27 September 2019
Sydney
63
Kyckr Limited
Shareholder information
30 June 2019
The shareholder information set out below was applicable as at 26 September 2019.
Distribution of equitable securities
Analysis of number of equitable security holders by size of holding:
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
Twenty largest quoted equity security holders
The names of the twenty largest security holders of quoted equity securities are listed below:
Mr Richard John White
HSBC Custody Nominees (Australia) Limited
Merrill Lynch (Australia) Nominees Pty Limited
Bell Potter Nominees Ltd (BB Nominees A/C)
Mr Benjamin Cronin
National Nominees Limited
Mr Robert Henry Leslie
Mr David Cassidy
Dixson Trust Pty Limited
Mr John Murray
Mr Richard Wood
Citicorp Nominees Pty Limited
BNP Paribas Noms Pty Ltd (Drp)
Mr Benjamin Cronin & Mr Robert Henry Leslie (GBR Emp Stock Opt A/C)
Pershing Australia Nominees Pty Ltd (Accum A/C)
Global Business Register Asia Pacific Pte Ltd
Mr Peter Howells
Mark Steven Kane
Coolpanda Pty Ltd (Coolpanda Family Super A/C)
BNP Paribas Nominees Pty Ltd Hub24 Custodial Serv Ltd Drp
64
Number
of holders
of options
and rights
over
ordinary
shares
Number
of holders
of ordinary
shares
34
435
366
748
163
1,746
32
-
-
-
-
20
20
-
Ordinary shares
Number held
% of total
shares
issued
45,435,000
17,444,776
13,416,138
10,626,613
8,519,129
8,038,892
6,619,247
4,930,212
4,500,000
4,230,703
4,230,703
3,266,508
3,055,885
2,998,163
2,851,994
2,482,872
2,100,000
1,900,000
1,800,000
1,795,000
150,241,835
19.81
7.61
5.85
4.63
3.72
3.51
2.89
2.15
1.96
1.84
1.84
1.42
1.33
1.31
1.24
1.08
0.92
0.83
0.78
0.78
65.50
Kyckr Limited
Shareholder information
30 June 2019
Unquoted equity securities
Options over ordinary shares issued
Performance rights over ordinary shares
The following persons hold 20% or more of unquoted equity securities:
Number
on issue
Number
of holders
19,722,222
25,391,063
13
7
Name
Mr Robert Leslie
Mr Benjamin Cronin
Mr Ian Henderson
Class
Performance rights over ordinary shares
Performance rights over ordinary shares
Performance rights over ordinary shares
Number held
6,500,000
6,500,000
5,391,063
Substantial holders
Substantial holders in the company are set out below:
Mr Richard John White
HSBC Custody Nominees (Australia) Limited
Merrill Lynch (Australia) Nominees Pty Limited
Voting rights
The voting rights attached to ordinary shares are set out below:
Ordinary shares
Number held
45,435,000
17,444,776
13,416,138
% of total
shares
issued
19.81
7.61
5.85
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.
65