A N N U A L R E P O R T 2 0 1 5
M e d i b i o r e d e f i n e s
m e n t a l h e a l t h
b y m a k i n g t h e
i n t a n g i b l e ,
t a n g i b l e .
C O N T E N T S T O T H E F I N A N C I A L R E P O R T
A N N U A L R E P O R T 2 0 1 5
2. CHAIRMAN'S REVIEW
4. CEO’S REPORT
19. KEY INVESTOR QUESTIONS & ANSWERS
20. STATUATORY ACCOUNTS
21. Review of Operations
25. Director’s Report
37. Auditor's Independence Declaration
38. Corporate Governance Statement
39. Consolidated Statement of Profit or Loss and Other Comprehensive Income
40. Consolidated Statement of Financial Position
41. Consolidated Statement of Changes in Equity
42. Consolidated Statement of Cash Flows
43. Contents to Notes to the Financial Statements
44. Notes to the Financial Statements
80. Director's Declaration
81. Independent Auditor's Report to the Members of Medibio Limited and Controlled Entities
83. ASX Additional Information
85. Corporate Information
M E N TA L H E A LT H L A N D S C A P E
350 million worldwide diagnosed with depression
1 suicide every 40 seconds = 1 million suicides every year
27%
of adult population affected by
a mental health disorder
26%
of adult population affected by
a mental health disorder
Global cost $2.5T (2030 est. $6T)
Depression and anxiety account for +50% of this burden
20%
of adult population affected by
a mental health disorder
1
C H A I R M A N ’ S R E V I E W
Dear fellow shareholder,
It is with great pleasure that I present to you the Medibio Limited annual report for the
year ended 30 June, 2015.
We have reached the end of a busy year for the company, during which time we moved
significantly closer towards the successful commercialisation of our patented Circadian
Heart Rate (CHR) diagnostic technology. Our company name change from BioProspect to
Medibio signified the transition to an exciting new business focus and vision which we firmly believe will reward
our shareholders in the year ahead.
We are thrilled to have produced the first objective test for chronic stress over the past 12 months, representing
what we believe to be a global breakthrough and new gold standard in mental health diagnosis.
Our management team recently returned from a successful business development trip through the United States,
where we met with several major corporates and universities to discuss synergies in the areas of partnering
and research collaboration. The response was overwhelmingly positive, with four Non-Disclosure Agreements
with significant US-based corporates signed including device manufacturers, integrated health and wellness
providers and technology companies. We had a series of positive meetings with leading universities in the US and
Canada with all institutions visited expressing a desire to collaborate on research. We expect to execute formal
collaboration agreements with these universities in the coming months.
Our Australian and US clinical studies in conjunction with Johns Hopkins University of Medicine and the University
of New South Wales are progressing well. Following completion of these studies, we are targeting US Food and
Drug Administration approvals within 12 months and have engaged US-based regulatory advisory and clinical
research organisation NAMSA to assist us in satisfying these requirements.
Investors can look forward to the launch of our corporate stress product this year and our consumer app next
year which should generate first revenues for the company.
Medibio operates in a landscape where there is significant need for disruption of current accepted practices. We
have the solution to tackle a growing societal problem. More than 350 million people worldwide are diagnosed
with depression annually (a US$2.5 trillion cost) with over one million suicides globally every year. Efficient and
accurate diagnosis of mental illness is not only desirable - but critical.
I would like to take this opportunity to thank the shareholders for their support over the past 12 months and look
forward to sharing the exciting journey with you over the year ahead.
Regards
Chris Indermaur
Chairman
30th September 2015
2
“We will no longer
endorse DSM5, as it has
fundamental flaws and
we are actively seeking a
diagnostic system that is
evidence based”
“It is critical to realise
that we cannot succeed
if we use DSM categories as
the gold standard...”
“We need a quantitative
method for diagnosing
depression”
US National Institute of Mental Health
May 2013
3
C E O R E P O R T
Mental health is rapidly emerging as the largest issue
in healthcare today. It is faced by 1 in 4 people over
their lifetimes and globally, these illnesses result in
costs exceeding US$2 trillion per year.
We have developed the first evidence based quantitative test for all of the key mental health disorders, including
depression, anxiety and chronic stress.
Our defensible IP and technology has been developed based on over 15 years of research into the relationship
between the autonomic nervous system and mental health disorders.
We are accelerating progress with US and Australian trials underway with our FDA submission for depression due
in the first half of next year. We have identified existing reimbursement codes in the US which we can leverage
and this, along with our high profile trial partners, should pave the way for early clinical acceptance.
Research is being undertaken by leading institutions including Johns Hopkins University, the University of NSW
and the Universtiry of Ottawa. In addition we expect to announce a number of other significant research
agreements in the coming year.
Medibio is not just a traditional medical device company with revenue dependent upon regulatory approval.
We have multiple commercialisation routes via the Medical, Corporate, and Consumer market with each vertical
representing a multi-billion dollar revenue opportunity.
Our Corporate and Consumer market products are based on stress, which is not dependent on regulatory
approval, which means we can, and are, commercialising now.
We have signed two commercial agreements for our Corporate Stress product and are in advanced discissions
with a number of potential customers, many of which are multinational companies.
The coming year should be a defining one for Medibio as we are targeting:
The completion of both the Johns Hopkins and UNSW studies
FDA approval of our depression diagnostic test
Ramp up significant revenue from our Corporate Stress Product
The launch of our consumer Stress App
•
•
•
•
Regards
Dr. Kris Knauer | Chief Executive Officer (CEO)
4
A N N U A L R E P O R T 2 0 1 5
Our technology
Medibio’s research has allowed it to develop the first evidence
based quantitative diagnostic test for all the key mental health
disorders including:
• Depression
• Anxiety
• Mixed Depression and Anxiety
• Panic Disorder
• Psychosis and Schizophrenia
• PTSD – Post Traumatic Stress Disorder
• Stress
We have proprietary technology in which algorithms assist in the
diagnosis of a number of mental health conditions utilising the
analysis of Circadian Heart Rate (CHR) variability waveforms during
the sleep period when external influences are absent.
Algorithm development has only been possible with the
introduction of state of the art machine learning techniques.
C E O R E P O R T - T H E Y E A R I N R E V I E W
We know past success does not mean future success but we a proud of the leap forward we have taken for our
shareholders over the past 12 months.
Some of the key milestones we achieved over the past 12 months include:
•
•
•
•
•
•
Commencement of the first study with the UNSW at the Black Dog Institute clinic
Agreement with Johns Hopkins University to undertake a clinical validation study in the US
Lodgement of patent applications which, once granted, will provide an additional 20 years of exclusivity
Produced the first objective test to measure the level of stress and its impact on health
The completion of the development of our cloud based scalable Corporate Stress Platform
Execution of the first commercial agreement to provide our stress product to a major corporate.
United States business development meetings
The company visited the United States in July to undertake a series of meetings with major corporations which
had expressed an interest in partnering with Medibio and to discuss research collaboration with a number
of leading universities. Medibio has executed Non-Disclosure Agreements (NDA’s) with a number of US-
based corporations including device manufacturers, integrated health and wellness providers and technology
companies. A series of positive meetings were also held with a number of the leading universities in the US and
Canada, with all institutions visited expressing a desire to collaborate on research. We have announced the first of
these agreements with the University of Ottawa and we expect to execute formal collaboration agreements with
a number of other research partners in the coming months. This research will focus on using our CHR technology
for the diagnosis of Depression, Post-Traumatic Stress Disorder, Anxiety Disorder, Mixed depression and anxiety,
and Panic Disorder.
Australian Study – University of New South Wales
The first study of Medibio’s CHR technology being conducted by the University of New South Wales (UNSW) at
the Black Dog Institute clinic processed its first participant during the year. With 80 planned participants, the
study is due to be completed next year. The study is a comparative study of the Circadian Heart Rate patterns
between patients with melancholic and non-melancholic depression.
US-based clinical validation study – Johns Hopkins University of Medicine
Medibio reached agreement to undertake an independent clinical validation study of its Circadian Heart Rate
technology in conjunction with the Johns Hopkins University School of Medicine, located in Baltimore, Maryland,
USA. The study will:
•
•
Specifically determine whether CHR can provide objective physiological data to differentiate between
individuals with clinical depression and individuals without clinical depression
Assess the clinical validity of a proprietary software algorithm, developed by Medibio that detects
depression by measuring CHR variability clinically.
Data collected from the study will be utilised to support an application for US Food and Drug Administration (FDA)
certification of the company’s proprietary software algorithm. Data collection is due to be completed towards the
end of H1 2016.
Appointment of Regulatory Consultants
Leading US-based regulatory advisory and clinical research organisation NAMSA was appointed during the year
to assist with trial design, regulatory discussions, and Medibio’s 510(k) submission to the FDA relating to its
depression diagnostic. NAMSA is a global contract research organization (CRO) with a broad depth of experience
in the US, EU, South America, Asia, and other geographies. NAMSA currently has a customer base of over
5000 clients and has assisted these clients with a wide variety of services, including over 300 successful 510(k)
submissions. NAMSA will work with Johns Hopkins University in the USA to ensure that Medibio’s validation
studies are designed to test and satisfy FDA regulatory requirements.
6
A N N U A L R E P O R T 2 0 1 5
Creation of the first evidence-based ‘stress test’
During the year we produced what we believe to be the world’s first evidence-based test to measure stress
levels and its impact on health and wellbeing using our CHR technology. The product also includes a series of app
based intervention (or treatment) modules tailored specifically for employees’ stress levels. We also completed
the development and testing of our cloud based scalable infrastructure to deliver this Corporate Stress Product.
We successfully tested end-to-end automation including streaming of live data: from a range of ECG monitors
via the front end app on a range of smart phones; to our cloud based proprietary Algorithms and Data Analytics
solution; and near real-time results back to the front-end app. Despite leveraging off the Amazon Web Services
(AWS) platform much of the technology needed to create such a product did not exist making our commercial
product unique in this category.
First commercial agreements
The execution our first commercial service agreement to provide our corporate stress evaluation product to a major
Australian corporation was a key milestone for your company. With more than 10,000 staff/contractors. Medibio
will generate revenue of $100 per participant from each pilot phase of the program with revenue anticipated this
calendar year.
This was followed by the launch of our Corporate Wellness Partner Program with the execution of a Commercial
Service Agreement to provide our Corporate Stress product to Vital Conversations. Vital Conversations is a large
mental wellness provider in Western Australia with a diverse client base. They provide proactive psychological
health services to some of the largest corporates in Western Australia as well as the public and not for profit
sectors.
MOU with Preventice Solutions
Medibio entered a memorandum of understanding (MOU) with Preventice Solutions. Preventice Solutions is a
strategic combination of: eCardio Diagnostics® LLC (a leading provider of remote cardiac monitoring products
and services) and Preventice (an innovator in software solutions for remote patient care and developer of the
PatientCare Platform and the BodyGuardian® Remote Monitoring Sensor). Their health data platform is ideal for
the commercial delivery of our CHR tests to assist clinicians with the diagnosis of mental health disorders in the
medical setting.
Additionally, Preventice has significant infrastructure in the US including an end to end sales and distribution
chain to providers and leading medical organisations and a 24/7 patient call centre which could potentially be
leveraged by Medibio. The MOU provides a framework for how both parties could collaborate, which may lead
towards a strategic partnership agreement, and outlines the contemplated aspects of a definitive agreement.
New patents
The company lodged a series of provisional patents throughout the year, including:
•
•
The provisional application titled “Method and System for assessing Mental State”, was filed in the
US under provisional application serial no. 62/175,796. This patent covers discoveries made over the
past 18 months and will, if granted, complement and extend the existing patent suite covering mental
health diagnosis held by Medibio
The provisional application titled “Method and System for Monitoring Stress Conditions”, has been
filed in the US under provisional application serial no. 62/175,826. This patent covers Medibio’s
objective test to measure the level of stress and its impact on health and wellbeing.
We intend to seek patent protection in major jurisdictions including, but not limited to, Australia, the USA, the
UK, EU, Japan, China, and Russia. The applications, once granted, will provide 20 years of exclusivity for the
diagnosis of mental health disorders using CHR technology and assure the company’s monopoly rights in the US.
7
We are not only a test
for initial diagnosis but
a tool to determine
the effectiveness of
treatment as well as
patient compliance
and adherence
Market fact
In Australia last yearthere were 16 million GP visits for
mental health related issues. Of these, GP’s only referred
1 in 10 on to a psychiatrist or psychologist while in 63% of
cases they recommended antidepressant medications.
8
A N N U A L R E P O R T 2 0 1 5
C E O R E P O R T
Key Management Personnel
Dr. Kris Knauer | Chief Executive Officer (CEO)
•
•
•
•
20 years’ experience in Finance and Corporate Advisory
Experienced CEO of ASX-listed companies
Previous role as CEO in a group owning GP Centers and Radiology practices
Founded and grew ASX-listed company from sub $3 million valuation to $300 million valuation
prior to a $1bn takeover
Sean Mathieson | Chief Operating Officer (COO)
•
•
•
Business Technology Executive with 25 years of Global Business Software experience including
Oracle, SAP, Siebel Systems and UXC
Reputation for technology vision enabling business outcomes
Global Leadership Team of Siebel Systems, founding member of SAP Australia
Dr. Matt Mesnik | Chief Medical Officer
•
•
•
Healthcare Executive with 29 years of healthcare management experience
Chief Medical Officer of Aprima Medical Software, US EMR company
Chief Medical Officer of MinuteClinic, which developed the concept of retail healthcare and is the
largest US retail health clinic provider with over 10M annual primary care visits.
• MinuteClinic grew from 80 to over 500 clinics under Matt as CMO prior to its acquisition by CVS
Pharmacy.
Dr. Michael Player | Head of Research
•
•
•
Research Psychologist at UNSW and Research Fellow at USYD and the BMRI.
Also active patient work as a Clinical Psychologist
Completed his PhD at the University of NSW, investigating and quantifying objective, biological
markers of depression
Research found that neuroplasticity was reduced in depression, and provided ground-breaking
support for the hypothesis of impaired neuroplasticity in MDD.
•
Dr. Matt Flax | Head of Algorithm Development Team
PhD in Electrical Engineering (BioEngineering) from UNSW Australia
•
• Matt specialises in Signal Processing, Machine learning and its application, Bio-engineering, and
•
software engineering. With over 20 years of experience in industry.
Since completing his PhD he has applied his machine learning, signal processing and software
engineering skills to medical device projects as for groups including Cochlear, Mimosa Acoustics,
Bionic Vision Australia and the National Acoustics Laboratory
9
C E O R E P O R T
Advisory Board
Stephen Pearce | Chair of Advisory Board
•
•
•
•
CFO of Fortescue Metals Group Ltd having joined Fortescue in March 2010.
In that time he has raised approximately US$12 billion to support the growth of Fortescue’s iron
ore operations.
Non-Executive Chairman of the Lion’s Eye Institute, a leading Eye Research Institute based in
Perth, Western Australia.
Extensive experience in debt and equity markets internationally and will advise the Board through
this important phase of development funding and commercialisation.
Dr. Franklyn Prendergast | Advisory Board Member
•
•
•
•
•
Current Board of Directors member of Eli Lilly and Company
Past Chair of the Board of Governors of the Mayo Foundation
Past Chair, Department of Biochemistry and Molecular Biology, Mayo Foundation
Guggenheim Professor of Biochemistry and Molecular Biology, Mayo Medical School (retired-
January 2015)
Past Director, Mayo Clinic Center for Individualised Medicine and Mayo Clinic Comprehensive
Cancer Center
Dr. Hans Stampfer | Advisory Board Member
•
•
•
•
Professor of Psychiatry at the University of Western Australia and Head of Psychiatry at Joondalup
teaching Hospital.
The original inventor of Medibio’s CHR Technology for mental health diagnosis
As the discoverer of the relationship between circadian heart rate and mental illness, Prof
Stampfer is an invaluable addition to Advisory Board.
He is highly regarded in the field of Psychiatric Research and has international publications on the
relationship between circadian heart rate and mental illness.
Dr. Stephen Addis | Advisory Board Member
•
•
•
•
•
Head of Psychiatry at Fremantle Hospital, a large university teaching hospital.
Senior clinical and managerial positions in North America, the United Kingdom and Australia
which has given him first-hand knowledge of health systems internationally.
15 years’ experience as Principal Investigator/Investigator on pharmaceutical trials
Over a decade of clinical research into the effects of mental illness upon the circadian
heart rate.
Regular academic presentations at conferences both nationally and internationally.
10
A N N U A L R E P O R T 2 0 1 5
Stress
What is stress?
Stress is a natural human
response to pressure when
faced with threatening
or challenging situations.
A certain level of stress
is normal, and can be
beneficial in enabling
people to achieve peak
performance. The human
body should revert back
to its normal state after
a certain period of time,
following a stress-inducing
experience. However, this
reversion to normal can be
suppressed when individuals
are subjected to frequent
or repetitive stressful
situations. Long-lasting or
overwhelming stress can
have negative impacts upon
human health, wellbeing,
relationships, work and
general quality of life.
The impact of Stress
It is well recognised
that stress is one of the
primary precursors to
mental illness. Additionally,
the physical problems
related to chronic stress
include the impairment
of the immune response,
increased blood pressure,
and chronic muscle tension.
These problems can
eventually lead to serious
life-threatening illnesses
and studies have found
that individuals who have
undergone significant
stress have a much higher
probability of developing
serious illness such as heart
attacks, kidney disease, and
cancer, than non-stressed
individuals.
Recent research at the University of
Minnesota found that “for every single-
point increase in test scores measuring
stress levels, study participants’ risk of
stroke jumped by 19%”
Per the Journal of Aging Research, there is
a 37% increase in a man’s risk of dying in
the next 18 years if he is highly stressed
11
C E O R E P O R T
Breakthrough research
The autonomic nervous system (ANS) plays a
key role in circadian sleep-wake regulation of
physiological activity including heart rate.
Our technology has been developed from
extensive research into the relationship
between circadian heart rate, the ANS, and
psychological state. The research was initiated
at the University of Western Australia to test the
theory that mental state linked ANS disturbance
could be observed via the cardiovascular system.
The research involved the analysis of circadian
heart rate data covering all major psychiatric
disorders which have been compared to
traditional methods of clinical diagnosis.
This research involved the collection of 24 hour
ECG data and corresponding clinical psychiatric
diagnoses from thousands of subjects covering
all the key psychopathologies.
This data was collected over a 15 year
period including a number of clinical
studies with the key studies peer-
reviewed and published. The
technology was developed via the
correlation of CHR waveforms with
the corresponding clinical psychiatric
diagnosis.
Sleep is the key period for diagnosis. It is
only during sleep when external influences
and distractions are absent that you get a
true snapshot of what is going on with the
Autonomic Nervous System (ANS).
Our technology has been validated both
internally and externally via blinded studies with
one external blinded study peer-reviewed and
published showing 78-92% diagnostic accuracy.
We achieve sensitivities and speficities of +80%
which compares favourably to the gold standard
where the current concordance between
psychiatrists is around 70%.
CHR is ‘state-dependent’ meaning that a change
in mental state is associated with a change
in CHR waveform. Thus we provide a tool to
determine the effectiveness of treatment.
Serial monitoring of patients under psychiatric
treatment shows effective treatment is
associated with normalisation of CHR within
4 weeks.
12
A N N U A L R E P O R T 2 0 1 5
CLINICAL
NON-CLINICAL
Medical
Corporate
Consumer
Our business model
Unlike most traditional
medical device
businesses which
target the Clinical
market, Medibio has
three distinct market
opportunities for
commercialisation.
Our three market pillars
are Medical, Corporate
and Consumer
applications.
US$ 30Bn
Industry
US$ 19Bn
Industry
Primary Care Physicians
High Risk Occupations
(Defence, Police, Fire)
Insurance Companies
Psychiatrists
Psychologists
Therapists
Counsellors
Cardiologists
Figure 1 – Medibio’s Three Market Pillars
US$ 26Bn
Industry
App Stores
Wearables
Wellness
Corporate Wellness
Digital Health Companies
Professions
Elite Sports
13
C E O R E P O R T
Pillar 1:
The medical diagnostic market
It is the General Practioners and Primary
Care Physician’s (PCP’s) who are bearing
the burden of mental health care in Australia
and the US. They are being forced to try and do
in 10 minutes what it takes a specialist clinician over
one hour to do, with no diagnostic aid to assist them.
Our US market research shows a clear majority of
clinicians surveyed (+90%) would use Medibio’s
technology as a biomarker-based diagnostic
once it was clinically proven and reimbursable.
Following regulatory approval, Medibio’s tests
will be marketed as a diagnostic aid with the early
adopters to be GP’s and Primary Care Physicians
(PCP) in the US.
There are two primary markets for the use of the
technology
•
Initial diagnosis
• Monitoring to gauge treatment effectiveness, patient
compliance and adherence
“Primary Care Providers now
furnish over half of mental
health treatment in this
country and about 25 percent
of all primary care recipients
have diagnosable mental
disorders (most commonly,
anxiety and depression).
Yet many mental health
problems are not identified
in primary care, perhaps as
many as 50 percent.”
Bazelon Center for Mental Health Law,
Washington, DC USA
14
5% penetration of
the US market for
depression diagnosis
would generate
revenue of $175 million
annually. This revenue
would generate a strong
return for Medibio.
No data handling and
automated cloud based
analysis and reporting =
minimal cost per report
and very high margins
A N N U A L R E P O R T 2 0 1 5
Our delivery model is the “pathology style” model where the GP or PCP refers
the patient to a pathology lab for a test. We are device agnostic, meaning our
test will work with any ECG monitor the monitor providers already have.
Figure 2 – Operation in a medical setting
US medical diagnostic market opportunity: depression
Last year there were 21 million annual PCP visits in the US which were mental health related:
•
•
•
40% were prescribed psychiatric medication only
30% were presecribed medication and are referred for therapy
Only 30% were referred to a psychiatrist/psychologist
The table below illustrates the existing reimbursement structure for remote ECG monitoring of Cardiac Arrythmia patients in
the US. Medibio intends to leverage these existing CPT Codes for commercialisation. Our market research in the US indicates
that the PCP’s will be the early adopters. The 21 million annual mental health related PCP visits in the US for a circa $45 test
represents almost a $1 billion revenue opportunity annually. Including the psychatrists and psychologists doubles the revenue
opportunity. The ongoing monitoring market is larger with our market research showing clinicians would likely monitor
existing depression patients quarterly. Based on the 16 million people with depression in US quarterly monitoring at a $22.50
rebate is a $1.6 billion revenue opportunity annually.
CPT Code
Medicare
93225
93226
93227
Recording (Provider)
Analysis with Report (Medibio)
Physician review and Interpretation (PCP)
Private
$26.87
$37.91
$26.87
Insurance
Assumption
$40
$57
$40
$45 to Medibio
Table 1 – Partner and payment structure in the US for 24-hour ECG monitoring
15
C E O R E P O R T
Pillar 2:
Corporate stress market
Medibio’s Corporate Stress Product
The company has produced what it believes to be the world’s first evidence-based test to measure stress levels and their
impact on health and wellbeing, using its patented Circadian Heart Rate technology. The Corporate Stress product also
includes a series of app based intervention (treatment) modules tailored specifically for each employee’s determined stress
level.
The stress assessment test is based on a series of new algorithms that have been developed to measure the type and degree
of deviation of the subject’s CHR from normal, and the diagnostic significance of this deviation. Medibio’s new algorithms
accurately classify individuals into one of three categories based on the impact stress has had on their health and wellbeing:
GREEN: normal to mild, where no immediate action needed
AMBER: moderate, the impact of stress is approaching unhealthy levels
RED: serious, stress has had an unhealthy impact and lifestyle changes are recommended
The employee receives their individual stress assessment back to their phone with recommendations to undertake intervention
modules tailored to their stress assessment. The employer receives a de-identified aggregated measure of stress and risks
amongst its employees. This includes a number of interactive corporate dashboards (Figure 3) which are updated in real time
and show how factors such as job roles and responsibilities, shift schedules, working hours and locations, working conditions
might be associated with employee stress levels. The dashboards also allow management to track items such as the progress
of their staff with the interventions, participation profile, change of participation and stress over time.
Closed the loop from ECG monitor; to phone; to the cloud; and back to phone in real
time. Algorithms are running in the cloud with Amazon Web Services.
It costs us less than a cent each time we process an
ECG file to produce a stress report.
16
A N N U A L R E P O R T 2 0 1 5
US Market Opportunity for our Corporate Stress Product
Stress is a major health issue in the United States that impacts the vast majority of all adults to a moderate or severe degree.
It is not only a health issue but a key issue for employers. Various studies of the economic impact of stress estimate the cost of
stress to US employers of between US$200 billion to US$300 billion annually with workplace stress responsible for:
•
•
•
•
•
Over half of the 550 million working days lost annually in the U.S from absenteeism
40% of staff turn-over
60% of workplace accidents
30% of short and long term disability
55% of EAP (Employee Assist Program) cost
This impact of stress is now recognised by employers, particularly in the US, where 90% of corporates with 200 or more
employees now offer Corporate Wellness programs. With an annual wellness program spend of US$100-500 per employee
the overall size of the workplace wellness market in the US is US$8 billion annually.
We define the US market opportunity as the 54 million employees in the US in +1,000 staff firms and the 22 million US
government employees. Price point is important in this market with research indicating that at $120 price point our stress
product will be limited to executives and at risk employees only, but at a level of $60 per employee annually it will likely be
deployed across the entire staff base. At this $60 price point the US market represents a US$4.5 billion revenue opportunity.
To reach this market we intend to partner with existing participants in the Corporate Wellness market. Medibio will provide
cloud based data analytics and reporting rather than try to become a wellness company. Our core competency is algorithm
development and data analytics and we intend to stick to that.
Figure 3 – Corporate Stress Product Dashboards
17
C E O R E P O R T
Corporate Wellness - Market Overview
The key commercial attributes of Medibio’s Corporate Stress
product are that it is, objective, easy to administer, inexpensive and
scalable. There are no other objective products in the market, with
competing technologies based on questionnaires and interviews as
the main measurement tools which are not only time consuming
and costly but subjective.
We have been overwhelmed by the market response and although
we have not yet started our commercial launch we have executed
our first commercial service agreement to provide our corporate
stress evaluation product with a major Australian corporation
with more than 10,000 staff/contractors. We have also launched
our Corporate Wellness Partner Program with the execution of a
Commercial Service Agreement to provide our Corporate Stress
product to Vital Conversations. Vital Conversations is a large
mental wellness provider in Western Australia with a diverse client
base. It provides proactive psychological health services to some of
the largest corporates in Western Australia as well as the public and
not for profit sectors.
As we move into the final stage of Commercial Launch we expect
to convert advanced discussions with a number of other potential
customers into executed agreements.
Stress costs the average
US Corporation US$3.5 million
every year and they are now
beginning to recognise this
A 5% penetration of the US
market for our Corporate Stress
Product would generate $200
million in annual revenue
18
K E Y I N V E S T O R Q U E S T I O N S
A N N U A L R E P O R T 2 0 1 5
What is Medibio’s technology?
What is the Market Potential?
Our technology is an objective, or
evidence based, test for depression,
other mental illnesses, and stress.
It also provides a way to determine
if treatment is effective. Unlike the
traditional interpretive pen and paper
test it relies purely on the patients
biological data - in this case ECG data.
Mental health disorders cost the world
economy US$2.5T annually (WHO Study)
with the average global cost estimated to
be an average of 10% of any developed
countries GDP. The World Health
Organisation estimates that over 350
million people worldwide are currently
suffering from depression. The medical
diagnostic market for depression alone is
a US$15 billion revenue opportunity.
What is the scientific basis for
our technology?
The autonomic nervous system (ANS)
plays a key role in regulation of all
physiological activity including heart
rate. Our technology takes a snapshot
of the ANS by measuring heart rate
during sleep when external influences
and distractions are absent.
Does the technology work?
Our technology is based on over
15 years of research and internal
validation involving over 4000 subjects.
This is the equivalent of the completion
of a Phase II trial for a new drug. The
current studies are not being done to
determine that the technology works.
They are part of the process required
for regulatory approval and to have
key opinion leaders like Johns Hopkins
endorse the technology.
What can our technology diagnose?
How is the test administered?
We can diagnose all of the key mental
health disorders including depression,
anxiety, psychosis, and stress. Our test
can also differentiate between the
different types of depression, and mixed
disorders such as mixed depression and
anxiety which is critical in determining
the appropriate treatment plan.
The patient simply wears any ECG
monitor overnight. Putting the monitor
on an hour before going to bed and
removing it an hour after waking. The
test is conducted in the comfort of you
own home with the next generation
ECG monitors which are the size of a
large bandaid and as simple to wear.
19
S T A T U A T O R Y A C C O U N T S
O P E R A T I N G R E S U L T S F O R T H E Y E A R
Medibio Limited (formerly BioProspect Limited) (“Medibio”, “MEB” or “the Company”) and its
controlled entities (“the group”) generated a loss after tax of $7,921,702 (2014: loss of $428,332). This
loss would be reduced to $2,087,826 if the effects of one off items such as the impairment of the legacy
investment in Frontier Oil ($3,861,034), costs associated with the acquisition of the Circadian Heart
Rate (‘CHR’) and algorithm development technology ($1,011,382 and $444,999), and the amortisation
of patents ($516,461) were excluded.
Key highlights include:
• Restructuring the acquisition of Invatec Health Pty Ltd (‘Invatec’) and the capital structure
of Medibio. This proposal was approved by shareholders on 6 March 2015 and its major
components were:-
-
The Invatec acquisition was completed by the acquisition of all the issued capital of
Invatec by the issue of 25,537,506 post consolidation shares, representing 28.4% of
the company’s issued capital.
- All Convertible Notes on issue were converted into the Company’s securities.
-
-
Recent capital raisings were ratified reinstating the 15% issuing capacity.
The issued capital of the company was consolidated on a 1 for 100 basis.
- Approval was given to raise up to $3,000,000 by placement to professional and
sophisticated investors.
-
The Group has incurred $1,011,382 in legal and consulting costs in relation to the
acquisition of Invatec and the restructuring of Medibio capital.
•
Impairment of the Frontier Oil Corporation (‘FOC’) investment. This has resulted in $3,861,034
of the total loss for the year.
•
Impairment of the Goodwill on acquisition of a private company acquired during the year. This
has resulted in $444,999 of the total loss for the year.
• Amortisation of patents and intellectual property rights including licences resulted in a charge
of $516,461 in the year.
The Company raised additional equity of $3,477,000 from 2 capital raisings and $685,000 from
Convertible Notes converted into equity.
20
R E V I E W O F O P E R A T I O N S
A N N U A L R E P O R T 2 0 1 5
During the year the company continued to make excellent progress towards commercialising its unique evidence-based
objective tests to assist in the diagnosis of depression, other mental health disorders, and chronic stress. Medibio’s proprietary
technology comprises algorithms for the diagnosis of a number of mental health conditions utilizing the analysis of Circadian
Heart Rate (“CHR”) variability waveforms. Sleep is the key measurement period when external influences are absent. The
technology has multiple commercialisation routes in the medical, corporate and consumer markets, with each vertical
representing a multi-billion dollar market opportunity and potential revenue stream.
Key milestones achieved over the past 12 months include:
The completion of
the development of
Medibio’s cloud-based
scalable Corporate
Stress Product
Agreement with
Johns Hopkins
University to
undertake a
clinical validation
study in the US
Execution of the first
commercial service
agreement to provide
this product to a major
corporation
(completed subsequent to 30 June 2015)
Lodgement of two
provisional patents
applications which, if
granted, will provide an
additional 20 years of
exclusivity for the diagnosis
of mental health disorders
and stress using CHR.
Commencement
of the first study
with the UNSW
at the Black Dog
Institute clinic;
21
R E V I E W
O F
O P E R A T I O N S
Review
of
Operations
(continued)
R E V I E W O F O P E R A T I O N S
agreement
with
Johns
Hopkins
University
to
undertake
a
clinical
validation
study
in
the
US;
and
lodgement
of
two
provisional
patents
applications
which,
if
granted,
will
provide
an
additional
20
years
of
exclusivity
for
the
diagnosis
of
mental
health
disorders
and
stress
using
CHR.
•
•
United
States
business
development
meetings
Post
the
end
of
the
financial
year
executive
management
of
the
company
visited
the
United
States
to
undertake
a
series
of
meetings
with
major
corporations
which
had
expressed
an
interest
in
partnering
with
Medibio
and
to
discuss
research
collaboration
with
a
number
of
leading
universities.
The
company
executed
Non-‐Disclosure
Agreements
(NDA’s)
with
four
US-‐based
corporations
including
device
manufacturers,
integrated
health
and
wellness
providers
and
technology
companies.
A
series
of
positive
meetings
were
held
with
a
number
of
the
leading
universities
in
the
US
and
Canada,
with
all
institutions
visited
expressing
a
desire
to
collaborate
on
research.
This
research
will
focus
on
using
CHR
for
the
diagnosis
of:
Post-‐Traumatic
Stress
Disorder;
• Depression;
•
• Anxiety
Disorder;
• Mixed
depression
and
anxiety;
•
Panic
Disorder.
Some
institutions
have
existing
data
that
can
be
used
to
fast-‐track
blinded
validation
trials
of
Medibio’s
technology.
Medibio
anticipates
it
will
be
in
a
positon
to
begin
to
execute
formal
collaboration
agreements
and
announce
additional
details
of
these
studies
in
the
coming
months.
Australian
trial
-‐
University
of
New
South
Wales
The
first
study
of
Medibio’s
CHR
technology
being
conducted
by
the
University
of
New
South
Wales
(UNSW)
at
the
Black
Dog
Institute
(BDI)
clinic
processed
its
first
participant,
with
80
planned
participants
due
to
complete
the
assessment
by
the
end
of
this
year.
The
study
is
designed
to
demonstrate
that
MEB’s
Circadian
Heart
Rate
Variability
technology
is
the
first
objective
diagnostic
tool
able
to
distinguish
between
the
two
subsets
of
depression:
melancholic
and
non-‐melancholic
depression.
The
study
will
involve
serial
monitoring
of
the
participants
before
and
after
treatment.
US-‐based
clinical
validation
study
–
Johns
Hopkins
University
of
Medicine
Medibio
is
currently
completing
an
independent
clinical
validation
study
of
its
CHR
Technology
in
conjunction
with
the
Johns
Hopkins
University
School
of
Medicine,
located
in
Baltimore,
Maryland,
USA.
The
study
will:
•
Specifically
determine
whether
CHR
can
provide
objective
physiological
data
to
differentiate
between
individuals
with
clinical
depression
and
individuals
without
clinical
depression;
and
• Assess
the
clinical
validity
of
a
proprietary
software
algorithm,
developed
by
Medibio
that
detects
depression
by
measuring
CHR
variability
clinically.
Data
collected
from
the
study
will
be
utilised
to
support
an
application
for
US
Food
and
Drug
Administration
(FDA)
certification
of
the
company’s
proprietary
software
algorithm.
Data
collection
is
due
to
be
completed
towards
the
end
of
Q1
2016.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
2
22
A N N U A L R E P O R T 2 0 1 5
R E V I E W
O F
O P E R A T I O N S
Appointment
of
NAMSA
Leading
US-‐based
regulatory
advisory
and
clinical
research
organisation
NAMSA
was
appointed
to
assist
with
trial
design,
regulatory
discussions,
and
Medibio’s
510(k)
submission
to
the
FDA
relating
to
its
depression
diagnostic.
NAMSA
is
a
global
contract
research
organization
(CRO)
with
a
broad
depth
of
experience
in
the
US,
EU,
South
America,
Asia,
and
other
geographies.
It
began
operations
in
Toledo
Ohio
in
1967.
NAMSA
has
over
800
associates,
with
offices
across
the
US,
UK,
France,
Germany
and
China,
and
individual
employees
in
many
other
countries.
NAMSA
currently
have
customer
base
of
over
5000
clients
and
have
assisted
these
clients
with
a
wide
variety
of
services,
including
over
300
successful
510(k)
submissions.
NAMSA
will
work
with
Johns
Hopkins
University
in
the
USA
to
ensure
that
Medibio’s
validation
studies
are
designed
to
test
and
satisfy
FDA
regulatory
requirements.
Creation
of
evidence-‐based
‘stress
test’
The
company
has
produced
and
validated
what
it
believes
to
be
the
world’s
first
evidence-‐based
test
to
measure
stress
levels
and
its
impact
on
health
and
wellbeing
using
its
patented
CHR
technology.
The
product
also
includes
a
series
of
app-‐based
intervention
(or
treatment)
modules
tailored
specifically
for
employees’
stress
levels.
A
series
of
new
algorithms
were
developed
to
measure
the
type
and
degree
of
deviation
of
the
subject’s
CHR
from
normal
and
the
significance
of
this
deviation.
The
new
algorithms
accurately
classify
individuals
into
one
of
three
categories
based
on
the
impact
stress
has
had
on
their
health
and
wellbeing:
• Normal
to
mild:
• Moderate:
•
Serious:
Where
no
immediate
action
needed;
The
impact
of
stress
is
approaching
unhealthy
levels;
and
Stress
has
had
an
unhealthy
impact
&
lifestyle
changes
are
recommended.
Internal
validation
testing
returned
excellent
results
with
sensitivities
and
specificities
in
excess
of
80%
for
correctly
assessing
the
subject
into
one
of
these
three
stress
categories.
This
compares
favourably
to
the
diagnostic
accuracy
of
traditional
self-‐report
questionnaires
for
assessing
stress
levels
that
are
typically
in
the
40-‐60%
range.
Subsequent
to
the
end
of
the
financial
year
Medibio
announced
two
key
milestones
related
to
its
corporate
stress
product.
1) The
completion
of
the
development
and
testing
its
cloud
based
scalable
corporate
stress
product.
This
incorporates
end-‐to-‐end
automation
including
streaming
of
live
data
from
a
range
of
ECG
monitors
via
the
front
end
app
on
a
range
of
smart
phones;
to
its
cloud
based
proprietary
algorithms
and
data
analytics
solution;
and
near
real-‐time
results
back
to
the
front-‐end
app.
2) The
execution
of
the
first
commercial
service
agreement
to
provide
its
corporate
stress
evaluation
product
with
a
major
Australian
corporation
with
more
than
10,000
staff/contractors.
Medibio
will
generate
revenue
of
$100
per
participant
from
each
pilot
phase
of
the
program
with
revenue
anticipated
this
calendar
year.
Contingent
on
commercial
pilot
results,
it
is
anticipated
that
Medibio’s
corporate
stress
product
will
be
rolled
out
across
the
organisation’s
entire
staff
base.
There
are
many
potential
markets
for
the
‘stress
test’
that
offer
significant
benefits
to
Medibio
upon
successful
commercialisation.
The
company
continues
to
develop
these
plans.
The
company
is
in
discussions
with
a
number
of
potential
customers
for
its
stress
product
ahead
of
the
commercial
launch.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
3
23
R E V I E W O F O P E R A T I O N S
R E V I E W
O F
O P E R A T I O N S
Commercialisation
Study
completed
In
February
2015,
the
Ametus
Group
delivered
a
comprehensive
independent
commercialisation
assessment
of
Medibio’s
CHR
technology
for
the
US
market.
The
Ametus
Group
is
based
in
Minnesota,
USA
and
is
one
of
the
leading
independent
medical
consulting
groups
in
the
United
States.
The
key
points
from
the
assessment
were:
• US$2.3bn
revenue
opportunity
in
the
US
which
is
likely
to
be
highly
profitable;
•
Existing
reimbursement
codes
which
may
be
leveraged
for
commercialisation;
• Ready
acceptance
of
the
technology
upon
the
receipt
of
FDA
approval;
• No
competing
FDA
approved
evidence-‐based
products
to
assist
clinicians;
and
•
Potential
market
share
of
5%
within
5
years
would
generate
annual
revenue
of
approximately
US$100
million.
Intellectual
property
The
company
lodged
a
series
of
provisional
patents
throughout
the
year,
including:
•
The
provisional
application
titled
“Method
and
System
for
assessing
Mental
State”,
was
filed
in
the
US
under
provisional
application
serial
no.
62/175,796.
This
patent
covers
discoveries
made
over
the
past
18
months
and
will,
if
granted,
complement
and
extend
the
existing
patent
suite
covering
mental
health
diagnosis
held
by
Medibio;
and
The
provisional
application
titled
“Method
and
System
for
Monitoring
Stress
Conditions”,
has
been
filed
in
the
US
under
provisional
application
serial
no.
62/175,826.
This
patent
covers
Medibio’s
objective
test
to
measure
the
level
of
stress
and
its
impact
on
health
and
wellbeing.
•
The
company
intends
to
seek
patent
protection
in
major
jurisdictions
including,
but
not
limited
to,
Australia,
the
USA,
the
UK,
EU,
Japan,
China,
and
Russia.
The
applications,
once
granted,
will
provide
20
years
of
exclusivity
for
the
diagnosis
of
mental
health
disorders
using
CHR
technology
and
assure
the
company’s
monopoly
rights
in
the
US.
Board
Changes
During
the
year,
the
company
announced
several
key
appointments:
• Mr
Chris
Indermaur
–
Non
Executive
Chairman;
• Mr
Kris
Knauer
–
Executive
Director;
• Dr
James
Campbell
-‐
Non
Executive
Director;
• Dr
Franklyn
G.
Prendergast
(M.D.,
Ph.D.)
-‐
appointed
to
the
company’s
Advisory
Board;
• Mr
Stephen
Pearce
-‐
Advisory
Board;
• Dr
Hans
Stampfer
-‐
Advisory
Board;
and
• Dr
Stephen
Addis
-‐
Advisory
Board.
During
the
year,
Mr
Vince
Fayad
retired
as
a
Director,
and
Non-‐Executive
Chairman
of
the
company
as
did
Claude
Solitario,
Peter
May
and
Silvi
ElKhouri.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
4
24
A N N U A L R E P O R T 2 0 1 5
D I R E C T O R S
R E P O R T
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
D I R E C T O R S
R E P O R T
Your
directors
present
the
Annual
Report
on
the
consolidated
entity,
being
Medibio
Limited
(formerly
BioProspect
Limited)
and
its
controlled
entities
(“Group”)
for
the
financial
year
ended
30
June
2015.
Your
directors
present
the
Annual
Report
on
the
consolidated
entity,
being
Medibio
Limited
(formerly
BioProspect
Your
directors
present
the
Annual
Report
on
the
consolidated
entity,
being
Medibio
Limited
(formerly
BioProspect
Limited)
and
its
controlled
entities
(“Group”)
for
the
financial
year
ended
30
June
2015.
Limited)
and
its
controlled
entities
(“Group”)
for
the
financial
year
ended
30
June
2015.
Directors
Directors
Directors
The
names
and
details
of
the
company’s
directors
in
office
during
the
financial
year
and
until
the
date
of
this
report
are
as
follows.
Directors
were
in
office
for
this
entire
period
unless
otherwise
stated.
The
names
and
details
of
the
company’s
directors
in
office
during
the
financial
year
and
until
the
date
of
this
report
The
names
and
details
of
the
company’s
directors
in
office
during
the
financial
year
and
until
the
date
of
this
report
are
as
follows.
Directors
were
in
office
for
this
entire
period
unless
otherwise
stated.
are
as
follows.
Directors
were
in
office
for
this
entire
period
unless
otherwise
stated.
Names,
qualifications,
experience
and
special
responsibilities
Names,
qualifications,
experience
and
special
responsibilities
Names,
qualifications,
experience
and
special
responsibilities
Current
Directors
Current
Directors
Current
Directors
Chris
Indermaur
Chris
Indermaur
Chris
Indermaur
Qualifications:
Qualifications:
Qualifications:
Experience:
Experience:
Experience:
Chairman
Chairman
Chairman
B.
Eng.
(Mech.),
Grad
Dip
Eng.
(Chem.),
LLB,
LLM,
Grad
Dip
LP
B.
Eng.
(Mech.),
Grad
Dip
Eng.
(Chem.),
LLB,
LLM,
Grad
Dip
LP
B.
Eng.
(Mech.),
Grad
Dip
Eng.
(Chem.),
LLB,
LLM,
Grad
Dip
LP
Mr
Indermaur
was
appointed
to
the
Medibio
Board
on
7
April
2015.
Mr
Indermaur
was
appointed
to
the
Medibio
Board
on
7
April
2015.
Mr
Indermaur
was
appointed
to
the
Medibio
Board
on
7
April
2015.
Mr
Indermaur
has
over
30
years
of
experience
in
large
Australian
companies
in
Engineering
Mr
Indermaur
has
over
30
years
of
experience
in
large
Australian
companies
in
Engineering
Mr
Indermaur
has
over
30
years
of
experience
in
large
Australian
companies
in
Engineering
or
Commercial
roles.
Amongst
these
roles
he
was
the
engineering
and
Contracts
Manager
or
Commercial
roles.
Amongst
these
roles
he
was
the
engineering
and
Contracts
Manager
or
Commercial
roles.
Amongst
these
roles
he
was
the
engineering
and
Contracts
Manager
for
the
QNI
Nickel
Refinery
at
Yabulu,
Company
Secretary
for
QAL
and
General
Manager
for
for
the
QNI
Nickel
Refinery
at
Yabulu,
Company
Secretary
for
QAL
and
General
Manager
for
for
the
QNI
Nickel
Refinery
at
Yabulu,
Company
Secretary
for
QAL
and
General
Manager
for
Strategy
and
Development
at
Alinta
Ltd.
Strategy
and
Development
at
Alinta
Ltd.
Strategy
and
Development
at
Alinta
Ltd.
Mr
Indermaur
is
currently
Chairman
of
Poseidon
Nickel
Limited
(ASX:
POS)
(director
from
Mr
Indermaur
is
currently
Chairman
of
Poseidon
Nickel
Limited
(ASX:
POS)
(director
from
Mr
Indermaur
is
currently
Chairman
of
Poseidon
Nickel
Limited
(ASX:
POS)
(director
from
2009).
2009).
2009).
Kris
Knauer
Kris
Knauer
Kris
Knauer
Qualifications:
Qualifications:
Qualifications:
Experience:
Experience:
Experience:
Executive
Director
Executive
Director
Executive
Director
B.
Sc.
(Hons)
in
Geology
B.
Sc.
(Hons)
in
Geology
B.
Sc.
(Hons)
in
Geology
Mr
Knauer
was
appointed
to
the
Board
on
1
July
2014
and
he
took
on
the
role
of
CEO
in
Mr
Knauer
was
appointed
to
the
Board
on
1
July
2014
and
he
took
on
the
role
of
CEO
in
Mr
Knauer
was
appointed
to
the
Board
on
1
July
2014
and
he
took
on
the
role
of
CEO
in
September
2014.
September
2014.
September
2014.
Kris
has
20
years’
experience
in
Finance
and
Corporate
Advisory
and
he
is
an
experienced
Kris
has
20
years’
experience
in
Finance
and
Corporate
Advisory
and
he
is
an
experienced
Kris
has
20
years’
experience
in
Finance
and
Corporate
Advisory
and
he
is
an
experienced
CEO
of
ASX-‐listed
companies.
He
has
had
a
previous
role
as
CEO
in
a
group
owning
GP
CEO
of
ASX-‐listed
companies.
He
has
had
a
previous
role
as
CEO
in
a
group
owning
GP
CEO
of
ASX-‐listed
companies.
He
has
had
a
previous
role
as
CEO
in
a
group
owning
GP
Centres
and
Radiology
practices.
He
also
founded
and
grew
an
ASX-‐listed
company
from
sub
Centres
and
Radiology
practices.
He
also
founded
and
grew
an
ASX-‐listed
company
from
sub
Centres
and
Radiology
practices.
He
also
founded
and
grew
an
ASX-‐listed
company
from
sub
$3
million
valuation
to
$300
million
valuation
prior
to
a
$1bn
takeover.
$3
million
valuation
to
$300
million
valuation
prior
to
a
$1bn
takeover.
$3
million
valuation
to
$300
million
valuation
prior
to
a
$1bn
takeover.
Mr
Knauer
was
formerly
a
director
of
Astro
Resources
NL
(ASX
ARO)
from
2013
to
August
Mr
Knauer
was
formerly
a
director
of
Astro
Resources
NL
(ASX
ARO)
from
2013
to
August
Mr
Knauer
was
formerly
a
director
of
Astro
Resources
NL
(ASX
ARO)
from
2013
to
August
2015,
Esperance
Minerals
Limited
(ASX:
ESM)
from
2009
to
August
2015
and
of
Greenvale
2015,
Esperance
Minerals
Limited
(ASX:
ESM)
from
2009
to
August
2015
and
of
Greenvale
2015,
Esperance
Minerals
Limited
(ASX:
ESM)
from
2009
to
August
2015
and
of
Greenvale
Energy
NL
from
2014
to
May
2015.
Energy
NL
from
2014
to
May
2015.
Energy
NL
from
2014
to
May
2015.
James
Campbell
James
Campbell
James
Campbell
Non-‐executive
Director
Non-‐executive
Director
Non-‐executive
Director
Qualifications:
Qualifications:
Qualifications:
PhD
MBA
PhD
MBA
PhD
MBA
Experience:
Experience:
Experience:
Dr
Campbell
was
appointed
to
the
Board
on
8
September
2014.
He
is
a
senior
biotechnology
Dr
Campbell
was
appointed
to
the
Board
on
8
September
2014.
He
is
a
senior
biotechnology
Dr
Campbell
was
appointed
to
the
Board
on
8
September
2014.
He
is
a
senior
biotechnology
in
scientific
research,
executive
with
more
than
20
years
in
scientific
research,
executive
with
more
than
20
years
in
scientific
research,
executive
with
more
than
20
years
management
consulting
and
venture
capital.
Dr
Campbell
has
held
research
positions
at
the
management
consulting
and
venture
capital.
Dr
Campbell
has
held
research
positions
at
the
management
consulting
and
venture
capital.
Dr
Campbell
has
held
research
positions
at
the
CNRS
and
the
CSIRO.
Dr
Campbell
was
a
founding
executive
at
ChemGenex
Pharmaceuticals
CNRS
and
the
CSIRO.
Dr
Campbell
was
a
founding
executive
at
ChemGenex
Pharmaceuticals
CNRS
and
the
CSIRO.
Dr
Campbell
was
a
founding
executive
at
ChemGenex
Pharmaceuticals
where
for
over
9
years
he
assisted
the
growth
of
the
company’s
market
capitalization
from
where
for
over
9
years
he
assisted
the
growth
of
the
company’s
market
capitalization
from
where
for
over
9
years
he
assisted
the
growth
of
the
company’s
market
capitalization
from
$10
million
to
the
final
$230
million
divestment
in
2011.
$10
million
to
the
final
$230
million
divestment
in
2011.
$10
million
to
the
final
$230
million
divestment
in
2011.
international
experience
international
experience
international
experience
Dr
Campbell
is
Managing
Director
of
Patrys
Limited
(ASX:
PAB)
(from
November
2014)
and
Dr
Campbell
is
Managing
Director
of
Patrys
Limited
(ASX:
PAB)
(from
November
2014)
and
Dr
Campbell
is
Managing
Director
of
Patrys
Limited
(ASX:
PAB)
(from
November
2014)
and
Non-‐executive
director
of
the
ASX-‐listed
biotechnology
companies
Invion
Limited
(ASX:
IVX)
Non-‐executive
director
of
the
ASX-‐listed
biotechnology
companies
Invion
Limited
(ASX:
IVX)
Non-‐executive
director
of
the
ASX-‐listed
biotechnology
companies
Invion
Limited
(ASX:
IVX)
from
2012,
and
Prescient
Therapeutics
Limited
(ASX:
PTX)
from
2014.
from
2012,
and
Prescient
Therapeutics
Limited
(ASX:
PTX)
from
2014.
from
2012,
and
Prescient
Therapeutics
Limited
(ASX:
PTX)
from
2014.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
5
5
5
25
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
Former
Directors
Vincent
Fayad
Mr
Fayad
was
appointed
to
the
Medibio
Board
on
28
April
2014
and
subsequently
became
Chairman.
Mr
Fayad
resigned
on
7
April
2015.
Mr
Fayad
is
currently
a
Director
of
PKF
Lawler
Corporate
Finance
Pty
Ltd
and
has
over
30
years
of
experience
in
Corporate
Finance,
accounting
and
other
advisory
related
services.
He
also
has
had
experience
in
advising
biotech
companies
on
fund
raising
and
corporate
strategy.
He
is
also
a
member
of
the
Chartered
Accountants
Australia
and
New
Zealand
and
is
a
registered
tax
agent
and
company
auditor.
Mr
Fayad
is
a
non-‐executive
Director
of
Ashley
Services
Grp
Ltd
(ASX:
ASH)
appointed
Aug
2014
and
former
non-‐executive
Director
of
Esperance
Minerals
Limited
(ASX:
ESM)
from
February
2013
to
August
2015.
Peter
May
Mr
May
was
appointed
as
a
Director
on
19
November
2012,
subsequently
became
Chairman
on
15
November
2013,
stood
down
as
Chairman
on
28
April
2014
and
resigned
as
a
non-‐executive
Director
on
1
July
2014.
Mr
May’s
career
has
included
positions
with
Incitec
and
Crop
Care
Australasia,
where
he
managed
a
multi-‐million
dollar
product
portfolio,
toll
formulation
and
international
business
development.
Mr
May
is
an
active
member
of
the
Australian
Environmental
Pest
Managers
Association
(AEPMA)
and
has
established
excellent
contacts
within
the
pest
control
and
general
agribusiness
and
animal
health
sectors.
Mr
May
has
not
been
a
director
of
any
other
ASX
listed
company.
Silvi
Elkhouri
Ms
Elkhouri
was
appointed
to
the
Board
on
15
November
2013
and
resigned
8
September
2014.
Ms
Elkhouri
has
had
extensive
international
business
and
finance
experience
and
assisted
in
several
merger
and
acquisition
transactions
involving
listed
and
unlisted
companies.
Ms
Elkouri
has
worked
as
a
corporate
strategy
consultant
for
private
companies
in
Australia
and
the
Middle
East.
During
the
past
three
years.
Ms
Elkhouri
has
not
been
a
director
of
any
other
ASX
listed
company.
Claude
Solitario
Mr
Solitario
was
appointed
28
April
2014
and
resigned
8
September
2014.
Mr
Solitario
who
founded
Invatec
Health
Pty
Ltd,
with
Dr
Stephen
Addis
in
2005,
joined
the
board
as
an
Executive
Director.
Mr
Solitario
has
been
instrumental
in
the
growth
of
Invatec
since
its
inception
in
his
role
as
CEO.
Mr
Solitario
has
over
25
years
of
experience
in
the
development
and
commercialisation
of
intellectual
property.
During
the
past
three
years.
Mr
Solitario
has
not
been
a
director
of
any
other
ASX
listed
company.
Executive
Management
Robert
Lees
Company
Secretary
Qualifications:
B.
Bus.
(UTS),
Grad.
Dip.
DP
(UTS),
CA,
AGIA
Experience:
Mr
Lees
was
appointed
Company
Secretary
and
Chief
Financial
Officer
on
30
September
2012.
Mr
Lees
is
responsible
for
complying
with
all
the
governance
requirements
of
a
listed
company
and
preparation
of
all
financial
and
management
reports
for
the
Medibio
group
of
companies.
In
the
last
14
years
he
has
provided
Company
Secretarial
services
to
several
small
ASX
listed
companies.
This
has
included
involvement
in
10
IPO’s
and
back
door
listings.
He
is
currently
Company
Secretary
of
4
other
listed
public
companies.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
6
26
D I R E C T O R S
R E P O R T
A N N U A L R E P O R T 2 0 1 5
Interests
in
the
shares
and
options
of
the
Company
and
related
bodies
corporate
As
at
the
date
of
this
report,
the
interests
of
the
directors
in
the
shares
and
options
of
Medibio
Limited
were:
Ordinary
Shares
150,000
6,440,541
Nil
Options
over
Ordinary
Shares
Nil
3,000,000
250,000
C.
Indermaur
K.
Knauer
J.
Campbell
Dividends
No
dividends
have
been
paid
or
provided
during
the
year
ended
30
June
2015
(2014:
nil).
Principal
Activities
The
principal
activity
of
the
Group
is
conducting
research
and
development
and
early
stage
commercialisation
of
the
following:
• a
diagnostic
technology
for
mental
health
which
is
based
on
circadian
heart
rate
(CHR)
data.
Business
Review
Operating
Results
The
consolidated
loss
of
the
Group
was
$7,921,702
(2014:
loss
of
$428,332).
Significant
Changes
in
the
State
of
Affairs
With
the
exception
of
those
matters
disclosed
in
Note
24,
there
are
no
other
matters
that
are
likely
to
affect
the
state
of
affairs
or
financial
position
of
the
Group.
Future
Developments
Likely
developments
in
the
operations
of
the
Group
in
future
financial
years,
are
referred
to
in
the
Review
of
Operations.
Events
Subsequent
to
Balance
Date
Apart
from
the
matters
set
out
below
and
in
Note
24
of
the
Financial
Statements,
and
the
issue
of
$3,092,035
of
shares
(further
details
of
these
notes
can
be
found
on
Note
16)
there
are
no
matters
or
circumstances
that
have
arisen
since
the
end
of
the
financial
year
that
have
significantly
affected
either:
•
•
the
Group’s
operations
in
financial
year
2015;
or
future
prospects.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
7
27
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
Other
Information
Options
On
1
April
2015
a
total
of
21,666,667
options
were
issued,
6,666,667
with
an
exercise
price
of
30cents
expiring
1
April
2017,
15,000,000
with
an
exercise
price
of
10cents
expiring
1
April
2018.
On
2
April
2015
136,658
options
were
exercised
for
136,658
shares
and
at
the
date
of
this
report
there
were
21,530,009
unissued
ordinary
shares
under
option.
Environmental
issues
The
Group’s
operations
are
not
regulated
by
any
significant
environmental
regulation
under
a
law
of
the
Commonwealth
or
of
a
state
or
territory.
Indemnifying
officers
or
auditors
Insurance
of
officers
During
the
financial
year,
Medibio
Limited
paid
a
premium
to
insure
the
directors
and
secretaries
of
the
Group
and
its
Australian
entities.
The
liabilities
insured
are
legal
costs
that
may
be
incurred
in
defending
civil
or
criminal
proceedings
that
may
be
brought
against
the
officers
in
their
capacity
as
officers
of
entities
in
the
Group,
and
any
other
payments
arising
from
liabilities
incurred
by
the
officers
in
connection
with
such
proceedings.
This
does
not
include
such
liabilities
that
arise
from
conduct
involving
a
wilful
breach
of
duty
by
the
officers
or
the
improper
use
by
the
officers
of
their
position
or
of
information
to
gain
advantage
for
themselves
or
someone
else
or
to
cause
detriment
to
the
Group.
It
is
not
possible
to
apportion
the
premium
between
amounts
relating
to
the
insurance
against
legal
costs
and
those
relating
to
other
liabilities.
The
Group
has
not
otherwise,
during
or
since
the
end
of
the
financial
year,
except
to
the
extent
permitted
by
law,
indemnified
or
agreed
to
indemnify
an
officer
or
auditor
of
the
Group
or
of
any
related
body
corporate
against
a
liability
incurred
as
such
an
officer
or
auditor.
Details
of
the
premium
paid
in
respect
of
insurance
policies
are
not
disclosed
as
such
disclosure
is
prohibited
under
terms
of
the
contract.
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
Group,
or
to
intervene
in
any
proceedings
to
which
the
Group
is
a
party,
for
the
purpose
of
taking
responsibility
on
behalf
of
the
Group
for
all
or
part
of
those
proceedings.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
8
28
A N N U A L R E P O R T 2 0 1 5
D I R E C T O R S
R E P O R T
Remuneration
Report
(Audited)
This
report
outlines
the
key
management
personal
(KMP)
remuneration
arrangements
of
the
Company
and
the
Group
in
accordance
with
the
requirements
of
the
Corporations
Act
2001
and
its
regulations.
For
the
purposes
of
this
report,
KMP
of
the
Group
are
defined
as
those
persons
having
authority
and
responsibility
for
planning,
directing
and
controlling
the
major
activities
of
the
Company
and
the
Group,
directly
and
indirectly,
including
any
director
(whether
executive
or
otherwise)
of
the
parent
company.
For
the
purposes
of
this
report,
the
term
‘executive’
encompasses
the
chief
financial
officer/
company
secretary
and
the
Marketing
Manager.
Details
of
key
management
personnel
i.
Directors
V.
Fayad
Chairman
(non-‐executive)
–
appointed
28
April
2014
and
resigned
7
April
2015
C.
Indermaur
Chairman
(non-‐executive)
–
appointed
7
April
2015
J.
Campbell
Director
(non-‐executive)
–
appointed
8
September
2014
K.
Knauer
Director
(executive)
–
appointed
1
July
2014
C.
Solitario
Director
(executive)
–
appointed
28
April
2014
–
resigned
8
September
2014
S.
ElKhouri
Director
(non-‐executive)
appointed
15
November
2013
–
resigned
8
September
2014
P.
D.
May
Director
(non-‐executive)
–
appointed
19
November
2012,
appointed
Chairman
15
November
2013,
ceased
as
Chairman
24
April
2014
&
resigned
1
July
2014
ii.
Executives
S.
Stapelberg
Marketing
–
appointed
1
May
2014
R.
E.
Lees
Chief
Financial
Officer/Company
Secretary
–
appointed
30
September
2012
Remuneration
Philosophy
The
performance
of
the
Group
depends
upon
the
quality
of
its
directors
and
executives.
To
perform
to
satisfactory
levels,
the
Company
must
attract,
motivate
and
retain
highly
skilled
directors
and
executives.
The
Board
of
Directors
is
responsible
for
determining
and
reviewing
compensation
arrangements
for
the
directors,
and
the
executive
team.
The
Board
assesses
the
appropriateness
of
the
nature
and
amount
of
emoluments
of
such
officers
on
a
periodic
basis
by
reference
to
relevant
employment
market
conditions
with
the
overall
objective
of
ensuring
maximum
stakeholder
benefit
from
the
retention
of
a
high
quality
Board
and
executive
team.
To
assist
in
achieving
the
objectives,
the
Board
considers
the
nature
and
amount
of
executive
directors’
and
officers’
emoluments
in
the
context
of
the
Group’s
financial
and
operational
performance.
Remuneration
structure
In
accordance
with
best
practice
corporate
governance,
the
structure
of
non-‐executive
director
and
senior
manager
remuneration
is
separate
and
distinct.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
9
29
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Non-‐executive
director
remuneration
Objective
The
Board
seeks
to
set
remuneration
at
a
level
which
provides
the
Company
with
the
ability
to
attract
and
retain
directors
of
the
appropriate
calibre,
whilst
incurring
a
cost
which
is
acceptable
to
shareholders
given
the
size
and
financial
standing
of
the
Company.
Structure
The
constitution
of
the
Company
specifies
that
non-‐executive
directors
are
entitled
to
be
paid,
out
of
the
funds
of
the
Company,
an
amount
of
remuneration
which:
does
not:
i.
ii.
a.
b.
in
any
year
exceed
in
aggregate
the
amount
last
fixed
by
ordinary
resolution;
or
consist
of
a
commission
on
or
percentage
of
profits
or
operating
revenue;
and
is
allocated
among
them:
i.
on
an
equal
basis
having
regard
to
the
proportion
of
the
relevant
year
for
which
each
director
held
office;
or
ii.
as
otherwise
decided
by
the
Board.
Each
director
receives
a
fee
for
being
a
director
of
the
Company.
According
to
the
constitution
of
the
Company,
if
a
director,
at
the
request
of
the
Board
performs
extra
services
or
makes
special
exertions
(including
going
or
living
away
from
the
director’s
usual
residential
address),
the
Company
may
pay
that
director
a
fixed
sum
set
by
the
Board
for
doing
so.
Remuneration
under
this
rule
may
be
either
in
addition
to
or
in
substitution
for
any
remuneration
to
which
that
director
is
entitled.
The
remuneration
of
non-‐executive
directors
for
the
period
ended
30
June
2015
is
detailed
in
Table
1
on
page
32
of
this
report.
Senior
manager
and
executive
director
remuneration
(executives)
Objective
The
Company
aims
to
reward
executives
with
a
level
of
remuneration
commensurate
with
their
position
and
responsibilities
within
the
Company
and
taking
into
account
the
size
and
financial
standing
of
the
Company
and
so
as
to
ensure
total
remuneration
is
competitive
by
market
standards.
Structure
In
determining
the
level
and
make–up
of
executive
remuneration,
the
Board
considers
market
levels
of
remuneration
for
comparable
executive’s
roles
for
similar
sized
organisations,
and
preferably
within
the
biotech
industry.
Remuneration
consists
of
fixed
remuneration
for
all
executives
with
a
variable
element
for
the
achievement
of
both
short
term
and
long
term
objectives.
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30
A N N U A L R E P O R T 2 0 1 5
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Fixed
and
Variable
Remuneration
Objective
The
level
of
fixed
remuneration
is
set
so
as
to
provide
a
base
level
of
remuneration,
which
is
both
appropriate
to
the
position
and
is
competitive
in
the
market.
Fixed
remuneration
is
reviewed
annually
by
the
Board
and
the
process
consists
of
a
review
of
companywide
performance
and
individual
performance,
relevant
comparative
remuneration
in
the
market
and,
where
appropriate,
external
advice
on
policies
and
practices.
Structure
Executives
are
paid
a
fixed
cash
component
consisting
of
an
annual
salary
plus
the
statutory
superannuation
and
annual
leave
and
long
service
leave
obligations.
The
fixed
remuneration
component
of
senior
management
in
the
Group
is
detailed
in
Table
1
below.
No
variable
remuneration
is
currently
payable
to
Directors
or
management.
Consequence
of
company’s
performance
on
shareholders’
wealth
The
Company
is
committed
to
maximising
the
value
of
its
biotech
and
other
assets
through
a
portfolio
of
investments
and
projects.
This
currently
comprises
of:
• a
diagnostic
technology
for
mental
health
which
is
based
on
circadian
heart
rate
data
generally
known
as
heart
rate
monitor
Heart
Rate
Variability
technology;
and
• products
associated
with
animal
health,
skincare
and
agriculture
–
AGRIPRO®,
REGEN®,
QCIDE®
and
TERMILONE®.
The
IP
is
being
maintained
while
we
look
for
purchasers.
As
critical
stages
of
projects
and
investments
are
reached
and
produce
positive
results,
significant
value
should
be
generated
to
shareholders
through
an
increase
in
the
share
price.
As
the
Company
is
at
least
several
years
away
from
generating
taxable
profits,
growth
of
shareholder
wealth
will
not
come
through
the
payment
of
dividends
but
by
an
expected
increase
in
the
average
share
price.
Shareholder
returns
30
June
2015
30
June
2014
30
June
2013
30
June
2012
30
June
2011
Share
price
-‐cents
40.0
0.4
0.1
0.2
0.8
Shares
on
issue
89,802,923
3,173,189,372
2,873,174,372
1,612,170,347
1,116,570,347
Capitalisation
$35.9m
Loss
per
share
–cents
(8.82)
$12.6m
(0.0015)
$2.9m
(0.05)
$3.2m
(0.2)
$8.9m
(0.3)
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31
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Remuneration
of
key
management
personnel
Table
1:
Remuneration
for
the
year
ended
30
June
2015
Short
Term
Salary
&
Fees
$
Executive
director
K
Knauer
a
192,000
Non-‐executive
directors
V
Fayad
–
Chairman
b
51,167
C
Indermaur
-‐
Chairman
5,694
c
J
Campbell
d
29,200
P
May
e
C
Solitario
f
-‐
-‐
S
Elkhouri
g
33,000
Sub-‐total
directors
311,061
Other
key
management
personnel
(KMP)
S
Stapelberg
97,192
R
E
Lees
134,606
Sub-‐total
executive
KMP
Totals
231,798
542,859
a. Appointed
1
July
2014
(Short-‐term
fee
accrued);
b. Resigned
7
April
2015;
c. Appointed
7
July
2015;
d. Appointed
8
September
2014;
Non-‐
Monetary
Benefits
Post-‐
Employment
Super
Share
Based
Payments
$
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
$
-‐
-‐
-‐
2,774
-‐
-‐
-‐
$
-‐
-‐
45,000
43,600
-‐
-‐
-‐
2,774
88,600
7,808
-‐
7,808
10,582
-‐
-‐
-‐
88,600
e. Resigned
1
July
2014;
f. Resigned
8
September
2014;
g. Resigned
8
September
2014.
Termination
Payment
$
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
Total
$
192,000
51,167
50,694
75,574
-‐
-‐
33,000
402,435
105,000
134,606
239,606
642,041
KMP
transaction
and
balances
are
disclosed
in
Notes
13
and
18
to
the
Financial
Statements.
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32
A N N U A L R E P O R T 2 0 1 5
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Table
2:
Remuneration
for
the
year
ended
30
June
2014
Short
Term
Post-‐Employment
Non-‐
Monetary
Benefits
Salary
&
Fees
$
Non-‐executive
directors
W
Willesee
-‐
Chairman
22,500
a
V
Fayad
b
B
Cooper
C
Solitario
P
May
S
Elkhouri
Sub-‐total
non-‐executive
directors
c
d
e
f
12,000
32,000
-‐
58,833
22,500
147,833
Other
key
management
personnel
(KMP)
P
May
g
R
Lees
Sub-‐total
executive
KMP
Totals
18,265
96,591
114,856
262,689
a. Resigned
15
November
2013;
b. Appointed
28
April
2014;
c. Resigned
28
April
2014;
d. Appointed
28
April
2014;
Super
$
Share
Based
Payments
-‐
-‐
-‐
-‐
-‐
-‐
1,735
-‐
1,735
1,735
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
Termination
Payment
$
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
Total
$
22,500
12,000
32,000
-‐
58,833
22,500
147,833
20,000
96,591
116,591
264,424
$
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
e. Resigned
1
July
2014;
f. Resigned
8
September
2014;
g. Appointed
1
May
2014.
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33
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Table
3:
Option
holdings
of
key
management
personnel
(consolidated)
Options
held
in
Medibio
Limited
(number)
(post-‐consolidation)
30
June
2015
Directors
V
Fayad
C
Indermaur
J
Campbell
K
Knauer
P
May
C
Solitario
S
Elkhouri
Executives
S
Stapelberg
R
Lees
Total
a
b
c
d
e
f
g
Balance
at
1
July
14
Granted
As
Remuneration
Options
Forfeited
Net
Change
Other
Balance
At
30
June
15
Vested
at
30
June
15
Total
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
250,000
-‐
-‐
-‐
-‐
-‐
-‐
250,000
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
3,000,000
-‐
-‐
-‐
-‐
-‐
-‐
3,000,000
-‐
-‐
-‐
-‐
-‐
3,000,000
-‐
-‐
3,000,000
-‐
-‐
250,000
3,000,000
-‐
-‐
-‐
-‐
-‐
3,250,000
a. Resigned
7
April
2015;
b. Appointed
7
April
2015;
c. Appointed
8
September
2014;
d. Appointed
1
July
2014;
Options
held
in
Medibio
Limited
(number)
(pre-‐consolidation)
e. Resigned
1
July
2014;
f. Resigned
8
September
2014;
g. Resigned
8
September
2014.
Balance
at
1
July
13
Granted
As
Remuneration
Options
Forfeited
Net
Change
Other
Balance
At
30
June
14
Vested
at
30
June
14
Total
30
June
2014
Directors
W
Willesee
V
Fayad
B
Cooper
C
Solitario
P
May
S
Elkhouri
Executives
S
Stapelberg
R
Lees
Total
a
b
c
d
e
f
g
15,000,00
-‐
-‐
-‐
2,000,000
-‐
-‐
-‐
17,000,000
a. Resigned
15
November
2013;
b. Appointed
28
April
2014;
c. Resigned
28
April
2014;
d. Appointed
28
April
2014;
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34
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
(15,000,000)
-‐
-‐
-‐
(2,000,000)
-‐
-‐
-‐
(17,000,000)
e. Resigned
1
July
2014;
f. Resigned
7
September
2014;
g. Appointed
1
May
2014.
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
14
A N N U A L R E P O R T 2 0 1 5
D I R E C T O R S
R E P O R T
Remuneration
Report
(audited)
(continued)
Table
4:
Shareholdings
of
key
management
personnel
(consolidated)
Shares
held
in
Medibio
Limited
(number)
(post-‐consolidation)
Balance
1
July
14
30
June
2015
Directors
V
Fayad
a
C
Indermaur
b
c
J
Campbell
d
K
Knauer
e
P
May
f
C
Solitario
S
Elkhouri
g
Executives
S
Stapelberg
R
Lees
Total
-‐
-‐
-‐
-‐
26,522
693,424
-‐
-‐
-‐
719,946
a. Resigned
7
April
2015;
b. Appointed
Chairman
7
April
2015;
c. Appointed
8
September
2014
d. Appointed
1
July
2014;
Granted
as
remuneration
On
exercise
of
options
Net
change
other
Balance
30
June
15
-‐
150,000
-‐
-‐
-‐
-‐
-‐
-‐
-‐
150,000
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
6,440,541
(26,522)
(693,424)
-‐
-‐
-‐
5,720,595
-‐
150,000
-‐
6,440,541
-‐
-‐
-‐
-‐
-‐
6,590,541
e. Resigned
1
July
2014;
f. Resigned
7
September
2014;
g. Resigned
7
September
2014.
Shares
held
in
Medibio
Limited
(number)
(pre-‐consolidation)
Balance
1
July
13
30
June
2014
Directors
W
Willesee
V
Fayad
B
Cooper
C
Solitario
P
May
S
Elkhouri
Executives
S
Stapelberg
R
Lees
Total
-‐
-‐
-‐
-‐
2,652,175
-‐
-‐
-‐
2,652,175
a
b
c
d
g
e
f
a. Resigned
15
November
2013;
b. Appointed
Chairman
28
April
2014;
c. Resigned
28
April
2014;
Granted
as
remuneration
On
exercise
of
options
Net
change
other
Balance
30
June
14
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
69,342,443
-‐
-‐
-‐
-‐
-‐
69,342,443
2,652,175
-‐
-‐
-‐
69,342,443
-‐
-‐
71,994,618
d. Appointed
28
April
2014;
e. Appointed
15
November
2013;
f. Appointed
1
May
2014.
g. Resigned
1
July
2014
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35
D I R E C T O R ’ S R E P O R T
D I R E C T O R S
R E P O R T
D I R E C T O R S
R E P O R T
Directors’
Meetings
Directors’
Meetings
The
number
of
meetings
of
directors
(including
meetings
of
committees
of
directors)
held
during
the
year
and
the
The
number
of
meetings
of
directors
(including
meetings
of
committees
of
directors)
held
during
the
year
and
the
number
of
meetings
attended
by
each
director
was
as
follows:
number
of
meetings
attended
by
each
director
was
as
follows:
Eligible
to
Eligible
to
attend
attend
1
1
6
6
4
4
6
6
3
3
1
1
3
3
Number
Number
attended
attended
1
1
6
6
3
3
6
6
3
3
1
1
3
3
Audit
committee
Audit
committee
Eligible
to
attend
Eligible
to
attend
-‐
-‐
-‐
-‐
1
1
1
1
-‐
-‐
-‐
-‐
-‐
-‐
Number
Number
attended
attended
-‐
-‐
-‐
-‐
1
1
1
1
-‐
-‐
-‐
-‐
-‐
-‐
Chris
Indermaur
Chris
Indermaur
Kris
Knauer
Kris
Knauer
James
Campbell
James
Campbell
V
Fayad
V
Fayad
C
Solitario
C
Solitario
P
May
P
May
S
ElKhouri
S
ElKhouri
Committee
membership
Committee
membership
As
at
the
date
of
this
report,
the
Company
had
no
separate
committees,
other
than
the
audit
committee.
As
at
the
date
of
this
report,
the
Company
had
no
separate
committees,
other
than
the
audit
committee.
Auditor
Non-‐Audit
Services
Auditor
Non-‐Audit
Services
The
following
non-‐audit
services
were
provided
by
the
entity’s
auditor,
William
Buck
(Qld).
The
directors
are
satisfied
The
following
non-‐audit
services
were
provided
by
the
entity’s
auditor,
William
Buck
(Qld).
The
directors
are
satisfied
that
the
provision
of
non-‐audit
services
is
compatible
with
the
general
standard
of
independence
for
auditors
imposed
that
the
provision
of
non-‐audit
services
is
compatible
with
the
general
standard
of
independence
for
auditors
imposed
by
the
Corporations
Act
2001
and
APES
110
Code
of
Ethics
for
Professional
Accountants.
The
nature
and
scope
of
each
by
the
Corporations
Act
2001
and
APES
110
Code
of
Ethics
for
Professional
Accountants.
The
nature
and
scope
of
each
type
of
non-‐audit
service
provided
means
that
auditor
independence
was
not
compromised.
type
of
non-‐audit
service
provided
means
that
auditor
independence
was
not
compromised.
William
Buck
received
the
following
amounts
for
the
provision
of
non-‐audit
services:
William
Buck
received
the
following
amounts
for
the
provision
of
non-‐audit
services:
Tax
compliance
Tax
compliance
Other
Other
Auditor
Independence
Auditor
Independence
The
auditor’s
independence
declaration
has
been
received
and
can
be
found
on
page
17.
The
auditor’s
independence
declaration
has
been
received
and
can
be
found
on
page
17.
Signed
in
accordance
with
a
resolution
of
the
directors
Signed
in
accordance
with
a
resolution
of
the
directors
2015
2015
12,575
12,575
690
690
2014
2014
8,150
8,150
595
595
Chris
Indermaur
Chris
Indermaur
Chairman
Chairman
30
September
2015
30
September
2015
Sydney,
NSW
Sydney,
NSW
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36
DIRECTORS
REPORT
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
16
Directors’
Meetings
The
number
of
meetings
of
directors
(including
meetings
of
committees
of
directors)
held
during
the
year
and
the
number
of
meetings
attended
by
each
director
was
as
follows:
Audit
committee
Eligible
to
attend
Number
attended
Eligible
to
attend
Number
attended
Chris
Indermaur
1
1
-‐
-‐
Kris
Knauer
6
6
-‐
-‐
James
Campbell
4
3
1
1
V
Fayad
6
6
1
1
C
Solitario
3
3
-‐
-‐
P
May
1
1
-‐
-‐
S
ElKhouri
3
3
-‐
-‐
Committee
membership
As
at
the
date
of
this
report,
the
Company
had
no
separate
committees,
other
than
the
audit
committee.
Auditor
Non-‐Audit
Services
The
following
non-‐audit
services
were
provided
by
the
entity’s
auditor,
William
Buck
(Qld).
The
directors
are
satisfied
that
the
provision
of
non-‐audit
services
is
compatible
with
the
general
standard
of
independence
for
auditors
imposed
by
the
Corporations
Act
2001
and
APES
110
Code
of
Ethics
for
Professional
Accountants.
The
nature
and
scope
of
each
type
of
non-‐audit
service
provided
means
that
auditor
independence
was
not
compromised.
William
Buck
received
the
following
amounts
for
the
provision
of
non-‐audit
services:
2015
2014
Tax
compliance
12,575
8,150
Other
690
595
Auditor
Independence
The
auditor’s
independence
declaration
has
been
received
and
can
be
found
on
page
17.
Signed
in
accordance
with
a
resolution
of
the
directors
Chris
Indermaur
Chairman
30
September
2015
Sydney,
NSW
A N N U A L R E P O R T 2 0 1 5
A U D I T O R ’ S I N D E P E N D E N C E
A U D I T O R ’ S
I N D E P E N D E N C E
D E C L A R A T I O N
D E C L A R A T I O N
Auditor’s
Independence
Declaration
under
Section
307C
of
the
Corporations
Act
2001
to
the
Directors
of
Medibio
Limited
I
declare
that,
to
the
best
of
my
knowledge
and
belief
during
the
year
ended
30
June
2015
there
have
been:
• no
contraventions
of
the
auditor
independence
requirements
as
set
out
in
the
Corporations
Act
2001
in
relation
to
the
audit;
and
• no
contraventions
of
any
applicable
code
of
professional
conduct
in
relation
to
the
audit.
William
Buck
(Qld)
ABN:
11
603
627
400
M.
Ayoob
A
Member
of
the
Firm
Dated
this
30th
day
of
September,
2015
Brisbane
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
17
37
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
C O R P O R A T E G O V E R N A N A C E
C O R P O R A T E
G O V E R N A N A C E
Medibio
Limited
(‘Medibio’)
through
its
Board
of
Directors
(‘Board’)
is
responsible
for
the
overall
corporate
governance
of
Medibio
and
has
adopted
as
a
guiding
principle
that
it
act
honestly,
conscientiously
and
fairly
in
accordance
with
the
law
and
in
the
interests
of
the
shareholders
with
a
view
to
building
sustainable
value
for
them,
the
Company’s
employees
and
other
stakeholders
in
the
Company.
The
Board
has
adopted
a
suite
of
governance
materials
which
are
available
in
the
Corporate
Governance
section
of
the
Company’s
website.
The
governance
materials
have
been
prepared
and
adopted
on
the
basis
that
corporate
governance
procedures
can
add
to
the
performance
of
the
Company
and
the
creation
of
shareholder
value,
and
help
to
engender
the
confidence
of
the
investment
market.
ASX
Corporate
Governance
Principles
and
Recommendations
This
statement
sets
out
the
material
governance
principles
and
processes
adopted
by
the
Board.
The
Board
supports
the
Corporate
Governance
Principles
and
Recommendations,
3rd
edition
as
released
by
the
ASX
Corporate
Governance
Council
(“ASX
Principles
or
“ASXCGC”).
The
Board
considers
and
applies
these
recommendations
to
the
extent
there
is
a
sound
reason
to
do
so
given
the
circumstances
of
the
Company.
The
Corporate
Governance
Statements
were
reviewed
and
approved
by
the
Board
on
19
June
2015
and
are
available
on
the
Company’s
website:
http://www.medibio.com.au/index.php/about/corporate-‐governance
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
18
38
C O N S O L I D A T E D
S T A T E M E N T
O F
P R O F I T
O R
C O N S O L I D A T E D S T A T E M E N T O F P R O F I T O R L O S S &
L O S S
&
O T H E R
C O M P R E H E N S I V E
I N C O M E
O T H E R C O M P R E H E N S I V E I N C O M E
A N N U A L R E P O R T 2 0 1 5
For
the
Year
Ended
30
June
2015
Profit
on
sale
of
investment
Other
income
Revenue
Finance
costs
Amortisation
&
Depreciation
Employee
costs
Impairment
of
investments
Research
and
development
expenses
Other
expenses
Loss
before
income
tax
Income
tax
benefit
Loss
attributable
to
members
of
Medibio
Limited
Other
comprehensive
income
-‐
items
that
may
be
reclassified
to
profit
or
loss
Total
other
comprehensive
income
for
the
period
net
of
tax
Total
comprehensive
income
attributable
to
members
of
Medibio
Basic
earnings
per
share
(cents
per
share)
Diluted
earnings
per
share
(cents
per
share)
Note
5
5
5
5
5
6
7
7
CONSOLIDATED
2015
$
-‐
261,933
261,933
(160,622)
(516,461)
(492,435)
(4,306,033)
(210,664)
(2,497,420)
(7,921,702)
-‐
(7,921,702)
2014
$
463,194
6,976
470,170
(107,221)
-‐
(138,833)
-‐
(15,091)
(637,357)
(428,332)
-‐
(428,332)
-‐
-‐
-‐
-‐
(7,921,702)
(428,332)
(16.995)
(16.995)
(0.015)
(0.015)
The
above
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income
should
be
read
in
conjunction
with
the
accompanying
notes.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
19
39
C O N S O L I D A T E D
S T A T E M E N T
O F
F I N A N C I A L
C O N S O L I D A T E D S T A T E M E N T
P O S I T I O N
O F F I N A N C I A L P O S I T I O N
As
at
30
June
2015
ASSETS
Current
Assets
Cash
and
cash
equivalents
Trade
and
other
receivables
Prepayments
Total
Current
Assets
Non-‐current
Assets
Available
for
sale
investments
Intangibles
assets
Total
Non-‐current
Assets
TOTAL
ASSETS
LIABILITIES
Current
Liabilities
Trade
and
other
payables
Borrowings
Total
Current
Liabilities
Non-‐current
Liabilities
Borrowings
Other
payables
Total
Non-‐current
Liabilities
TOTAL
LIABILITIES
NET
ASSETS
EQUITY
Issued
capital
Reserves
Accumulated
losses
TOTAL
EQUITY
Note
8
9
10
12
13
14
14
15
CONSOLIDATED
2015
$
2014
$
944,301
232,985
9,091
1,186,377
-‐
13,998,137
13,998,137
15,184,514
2,380,280
197,500
2,577,780
3,495,653
-‐
3,495,653
6,073,433
9,111,081
96,249
132,393
9,091
237,733
4,461,034
343,750
4,804,784
5,042,517
431,240
1,500,000
1,931,240
395,000
6,006
401,006
2,332,246
2,710,271
16
(a)
22
51,093,889
479,600
(42,462,408)
9,111,081
37,250,977
-‐
(34,540,706)
2,710,271
The
above
consolidated
statement
of
financial
position
should
be
read
in
conjunction
with
the
accompanying
notes.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
20
40
C O N S O L I D A T E D
S T A T E M E N T
O F
C H A N G E S
C O N S O L I D A T E D S T A T E M E N T
I N
E Q U I T Y
O F C H A N G E S I N E Q U I T Y
A N N U A L R E P O R T 2 0 1 5
For
the
Year
Ended
30
June
2015
At
1
July
2013
Comprehensive
income
Loss
for
the
period
Other
comprehensive
income
Total
comprehensive
income
Transactions
with
owners
Shares
issued
Share
options
lapsed
Total
transactions
with
owners
At
30
June
2014
Issued
Capital
$
36,650,527
Accumulated
Losses
$
(37,024,324)
Share
Based
Payments
Reserve
$
2,911,950
-‐
-‐
-‐
(428,332)
-‐
(428,332)
-‐
-‐
-‐
600,450
-‐
600,450
37,250,977
-‐
2,911,950
-‐
(34,540,706)
-‐
(2,911,950)
-‐
-‐
At
1
July
2014
37,250,977
(34,540,706)
Comprehensive
income
Loss
for
the
period
Other
comprehensive
income
Total
comprehensive
income
Transactions
with
owners
Shares
issued
Share
options
issued
Share
issue
costs
Total
transactions
with
owners
At
30
June
2015
-‐
-‐
-‐
(7,921,702)
-‐
(7,921,702)
-‐
-‐
-‐
-‐
14,393,862
-‐
(550,950)
13,842,912
51,093,889
-‐
-‐
-‐
-‐
(42,462,408)
-‐
479,600
-‐
479,600
479,600
Total
Equity
$
2,538,153
(428,332)
-‐
(428,332)
600,450
-‐
600,450
2,710,271
2,710,271
(7,921,702)
-‐
(7,921,702)
14,393,862
479,600
(550,950)
14,322,512
9,111,081
The
above
consolidated
statement
of
changes
in
equity
should
be
read
in
conjunction
with
the
accompanying
notes.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
21
41
C O N S O L I D A T E D
S T A T E M E N T
O F
C A S H
C O N S O L I D A T E D S T A T E M E N T
F L O W S
O F C A S H F L O W S
For
the
Year
Ended
30
June
2015
Cash
flows
from
operating
activities
Receipts
from
customers
R&D
Grant
received
Payments
to
suppliers
and
employees
Net
cash
flows
used
in
operating
activities
Cash
flows
from
investing
activities
Interest
received
Payments
for
intangible
assets
Proceeds
from
sale
of
available
for
sale
investments
Payments
for
acquisitions
Net
cash
flows
(used
in)
provided
by
investing
activities
Cash
flows
from
financing
activities
Proceeds
from
issues
of
shares
and
options
Transaction
costs
of
issue
of
shares
Repayment
of
convertible
notes
Proceeds
from
issue
of
convertible
notes
Interest
paid
Net
cash
flows
from
(used
in)
financing
activities
Net
(decrease)
/
increase
in
cash
and
cash
equivalents
Net
cash
acquired
in
business
combinations
Cash
and
cash
equivalents
at
beginning
of
the
year
Cash
and
cash
equivalents
at
end
of
the
year
Note
8
(a)
8
CONSOLIDATED
2015
$
2014
$
-‐
255,120
(1,770,203)
(1,515,083)
8,225
-‐
(619,482)
(611,257)
6,813
(1,087,181)
-‐
(10,000)
(1,090,368)
6,976
(343,750)
1,690,425
-‐
1,353,651
3,432,000
(550,950)
-‐
685,000
(112,940)
3,453,110
843,659
393
96,249
944,301
450
-‐
(1,200,000)
395,000
(22,532)
(827,082)
(84,688)
-‐
180,937
96,249
The
above
consolidated
statement
of
cash
flows
should
be
read
in
conjunction
with
the
accompanying
notes.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
22
42
C O N T E N T S
T O
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
A N N U A L R E P O R T 2 0 1 5
C O N T E N T S T O N O T E S T O
T H E F I N A N C I A L S T A T E M E N T S
1.
2.
3.
4.
5.
6.
7.
8.
9.
CORPORATE
INFORMATION
....................................................................................................................................
44
SUMMARY
OF
SIGNIFICANT
ACCOUNTING
POLICIES
..............................................................................................
44
SIGNIFICANT
ACCOUNTING
JUDGEMENTS,
ESTIMATES
AND
ASSUMPTIONS
.........................................................
56
SEGMENT
REPORTING
.............................................................................................................................................
57
REVENUES
AND
EXPENSES
.......................................................................................................................................
61
INCOME
TAX
............................................................................................................................................................
62
EARNINGS
PER
SHARE
..............................................................................................................................................
44
CASH
AND
CASH
EQUIVALENTS
...............................................................................................................................
64
TRADE
AND
OTHER
RECEIVABLES
............................................................................................................................
64
10.
OTHER
FINANCIAL
ASSET
–
AVAILABLE
FOR
SALE
FINANCIAL
ASSETS
.....................................................................
65
11.
BUSINESS
COMBINATIONS
......................................................................................................................................
66
13.
TRADE
AND
OTHER
PAYABLES
–
CURRENT
..............................................................................................................
69
14.
BORROWINGS
..........................................................................................................................................................
70
15.
OTHER
PAYABLES
(NON-‐CURRENT)
.........................................................................................................................
70
16.
ISSUED
CAPITAL
.......................................................................................................................................................
71
17.
AUDITORS’
REMUNERATION
...................................................................................................................................
74
18.
KEY
MANAGEMENT
PERSONNEL
.............................................................................................................................
74
19.
RELATED
PARTY
DISCLOSURES
.................................................................................................................................
74
20.
FINANCIAL
RISK
MANAGEMENT
OBJECTIVES
AND
POLICIES
...................................................................................
75
21.
CONTINGENT
LIABILITIES
.........................................................................................................................................
76
22.
SHARE-‐BASED
PAYMENT
PLANS
..............................................................................................................................
77
23.
PARENT
ENTITY
INFORMATION
...............................................................................................................................
78
24.
EVENTS
AFTER
THE
END
OF
THE
REPORTING
PERIOD
.............................................................................................
78
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
23
43
N OT E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
1.
CORPORATE
INFORMATION
Medibio
Limited
(formerly
BioProspect
Limited)
(the
parent)
(‘Medibio’)
is
a
for
profit
company
limited
by
shares
incorporated
in
Australia
whose
shares
are
publicly
traded
on
the
Australian
Securities
Exchange.
The
nature
of
the
operations
and
principal
activities
of
the
Group
are
described
in
the
Directors’
Report.
2.
SUMMARY
OF
SIGNIFICANT
ACCOUNTING
POLICIES
a. Basis
of
preparation
These
financial
statements
are
general-‐purpose
financial
statements
which
have
been
prepared
in
accordance
with
the
requirements
of
the
Corporations
Act
2001,
Australian
Accounting
Standards
and
other
authoritative
pronouncements
of
the
Australian
Accounting
Standards
Board.
The
financial
statements
have
also
been
prepared
on
a
historical
cost
basis,
except
for
available-‐for-‐sale
investments,
which
have
been
measured
at
fair
value.
The
financial
statements
have
been
prepared
on
a
going
concern
basis,
as
set
out
in
note
16(c).
Medibio
and
the
Group’s
ability
to
continue
as
a
going
concern
is
dependent
upon
its
ability
to
generate
sufficient
cash
from
future
operations
and
to
raise
additional
capital.
Australian
Accounting
Standards
set
out
accounting
policies
that
the
AASB
has
concluded
would
result
in
financial
statements
containing
relevant
and
reliable
information
about
transactions,
events
and
conditions.
Compliance
with
Australian
Accounting
Standards
ensures
that
the
financial
statements
and
notes
also
comply
with
International
Financial
Reporting
Standards.
The
following
is
a
summary
of
the
material
accounting
policies
adopted
by
the
Group
in
the
preparation
of
the
financial
statements.
The
accounting
policies
have
been
consistently
applied,
unless
otherwise
stated.
The
financial
statements
are
presented
in
Australian
dollars
and
all
values
are
rounded
to
the
nearest
dollar
unless
otherwise
stated.
b. New
and
revised
accounting
standards
for
Application
in
Future
Periods
The
AASB
has
issued
new
and
amended
accounting
standards
and
interpretations
that
have
mandatory
application
dates
for
future
reporting
periods
and
which
the
Group
has
decided
not
to
early
adopt.
A
discussion
of
those
future
requirements
and
their
impact
on
the
Group
is
as
follows:
AASB
9
Financial
Instruments
(December
2014)
and
AASB
2014-‐7
Amendments
to
Australian
Accounting
Standards
arising
from
AASB
9
(December
2014)
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2018)
AASB
9
includes
requirements
for
the
classification
and
measurement
of
financial
assets,
the
accounting
requirements
for
financial
liabilities,
impairment
testing
requirements
and
hedge
accounting
requirements.
The
changes
made
to
accounting
requirements
by
these
standards
include:
•
•
•
•
simplifying
the
classifications
of
financial
assets
into
those
carried
at
amortised
cost
and
those
carried
at
fair
value
and
an
allowance
for
debt
instruments
to
be
carried
at
fair
value
through
other
comprehensive
income
in
certain
circumstances
simplifying
the
requirements
for
embedded
derivatives
allowing
an
irrevocable
election
on
initial
recognition
to
present
gains
and
losses
on
investments
in
equity
instruments
that
are
not
held
for
trading
in
other
comprehensive
income.
Dividends
in
respect
of
these
investments
that
are
a
return
on
investment
can
be
recognised
in
profit
or
loss
and
there
is
no
impairment
or
recycling
on
disposal
of
the
instrument
financial
assets
will
need
to
be
reclassified
where
there
is
a
change
in
an
entity’s
business
model
as
they
are
initially
classified
based
on
(a)
the
objective
of
the
entity’s
business
model
for
managing
the
financial
assets;
and
(b)
the
characteristics
of
the
contractual
cash
flows
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
24
44
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
•
•
•
amending
the
rules
for
financial
liabilities
that
the
entity
elects
to
measure
at
fair
value,
requiring
changes
in
fair
value
attributed
to
the
entity’s
own
credit
risk
to
be
presented
in
other
comprehensive
income
introducing
new
general
hedge
accounting
requirements
intended
to
more
closely
align
hedge
accounting
with
risk
management
activities
as
well
as
the
addition
of
new
disclosure
requirements
requirements
for
impairment
of
financial
assets
The
Group
has
not
yet
assessed
the
impact
of
this
standard.
⎯ AASB
2014-‐8
Amendments
to
Australian
Accounting
Standards
arising
from
AASB
9
(December
2014)
–
Application
of
AASB
9
(December
2009)
and
AASB
9
(December
2010)
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2015)
This
standard
limits
the
application
of
the
existing
versions
of
AASB
9
(AASB
9
(December
2009)
and
AASB
9
(December
2010))
from
1
February
2015.
⎯ AASB
14
Regulatory
Deferral
Accounts
and
AASB
2014
-‐1
Amendments
to
Australian
Accounting
Standards
[Part
D]
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
AASB
14
applies
only
to
an
entity’s
first
Australian-‐Accounting-‐Standards
financial
statements
where
they
conduct
rate
regulated
activity
and
recognise
amounts
that
qualify
as
regulatory
deferral
account
balances.
AASB
2014-‐1
[Part
D]
makes
consequential
amendments
to
AASB
1
First-‐time
Adoption
of
Australian
Accounting
Standards.
This
standard
will
not
impact
the
entity.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
15
Revenue
from
Contracts
with
Customers
and
AASB
2014-‐5
Amendments
to
Australian
Accounting
Standards
arising
from
AASB
15
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2017)
AASB
15
establishes
a
single,
comprehensive
framework
for
revenue
recognition,
and
replaces
the
previous
revenue
Standards
AASB
118
Revenue
and
AASB
111
Construction
Contracts,
and
the
related
Interpretations
on
revenue
recognition
Interpretation
13
Customer
Loyalty
Programmes,
Interpretation
15
Agreements
for
the
Construction
of
Real
Estate,
Interpretation
18
Transfers
of
Assets
from
Customers
and
Interpretation
131
Revenue—Barter
Transactions
Involving
Advertising
Services.
AASB
15
introduces
a
five
step
process
for
revenue
recognition
with
the
core
principle
of
the
new
Standard
being
for
entities
to
recognise
revenue
to
depict
the
transfer
of
goods
or
services
to
customers
in
amounts
that
reflect
the
consideration
(that
is,
payment)
to
which
the
entity
expects
to
be
entitled
in
exchange
for
those
goods
or
services.
AASB
15
will
also
result
in
enhanced
disclosures
about
revenue,
provide
guidance
for
transactions
that
were
not
previously
addressed
comprehensively
(for
example,
service
revenue
and
contract
modifications)
and
improve
guidance
for
multiple-‐element
arrangements.
The
Group
has
not
yet
assessed
the
impact
of
this
standard.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
25
45
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
⎯ AASB
1056
Superannuation
Entities
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
July
2016)
AASB
1056
is
applicable
for
superannuation
entities
which
are
regulated
by
APRA
and
increase
the
level
of
integration
between
AASB
1056
and
other
AASB
standards.
Some
of
the
changes
in
AASB
1056
include:
• A
revised
definition
of
a
superannuation
entity
• Revised
and
consistent
content
for
the
financial
statements
• Use
of
fair
value
rather
than
net
market
value
for
measuring
assets
and
liabilities
• Revised
member
liability
recognition
and
measurement
requirements
• Revised
disclosure
principles
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2014-‐3
Amendments
to
Australian
Accounting
Standards
–
Accounting
for
Acquisitions
of
Interests
in
Joint
Operations
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
standard
amends
AASB
11
to
provide
guidance
on
the
accounting
for
acquisitions
of
interests
in
joint
operations
in
which
the
activity
constitutes
a
business.
The
amendments
require
the
acquirer
of
an
interest
in
a
joint
operation
in
which
the
activity
constitutes
a
business
to
apply
all
of
the
principles
in
AASB
3
and
other
Australian
Accounting
Standards
except
for
those
principles
that
conflict
with
the
guidance
in
AASB
11
in
accounting
for
the
acquisition.
AASB
2014-‐3
also
requires
disclosure
of
the
information
required
by
AASB
3
and
other
Australian
Accounting
Standards
for
business
combinations.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2014-‐4
Amendments
to
Australian
Accounting
Standards
–
Clarification
of
Acceptable
Methods
of
Depreciation
and
Amortisation
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
standard
amends
AASB
116
and
AASB
138
to
establish
the
principle
for
the
basis
of
depreciation
and
amortisation
as
being
the
expected
pattern
of
consumption
of
the
future
economic
benefits
of
an
asset
and
to
clarify
that
the
use
of
revenue-‐based
methods
to
calculate
the
depreciation
of
an
asset
is
not
appropriate.
The
standard
also
clarifies
that
revenue
is
generally
presumed
to
be
an
inappropriate
basis
for
measuring
the
consumption
of
the
economic
benefits
embodied
in
an
intangible
asset.
This
presumption,
however,
can
be
rebutted
in
certain
limited
circumstances.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2014-‐6
Amendments
to
Australian
Accounting
Standards
–
Agriculture:
Bearer
Plants
[AASB
101,
AASB
116,
AASB
117,
AASB
123,
AASB
136,
AASB
140
&
AASB
141]
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
standard
amends
the
accounting
for
bearer
plants
to
now
be
the
same
as
property,
plant
and
equipment
in
AASB
116
Property,
Plant
and
Equipment,
because
their
operation
is
similar
to
that
of
manufacturing.
Consequently,
the
amendments
include
them
within
the
scope
of
AASB
116,
instead
of
AASB
141
and
therefore
entities
can
choose
to
measure
them
at
cost
or
fair
value.
The
produce
growing
on
bearer
plants
will
remain
within
the
scope
of
AASB
141.
This
standard
is
not
expected
to
impact
the
Group.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
26
46
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
⎯ AASB
2014-‐9
Amendments
to
Australian
Accounting
Standards
–
Equity
Method
in
Separate
Financial
Statements
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
standard
will
allow
entities
to
use
the
equity
method
to
account
for
its
interest
in
subsidiaries,
joint
ventures
and
associates
in
separate
financial
statements
and
makes
editorial
corrections
to
AASB
127.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2014-‐10
Amendments
to
Australian
Accounting
Standards
–
Sale
or
Contribution
of
Assets
between
an
Investor
and
its
Associate
or
Joint
Venture
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
The
amendments
address
an
acknowledged
inconsistency
between
the
requirements
in
AASB
10
and
those
in
AASB
128
(2011),
in
dealing
with
the
sale
or
contribution
of
assets
between
an
investor
and
its
associate
or
joint
venture.
The
main
consequence
of
the
amendments
is
that
a
full
gain
or
loss
is
recognised
when
a
transaction
involves
a
business
(whether
it
is
housed
in
a
subsidiary
or
not).
A
partial
gain
or
loss
is
recognised
when
a
transaction
involves
assets
that
do
not
constitute
a
business,
even
if
these
assets
are
housed
in
a
subsidiary.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2015-‐1
Amendments
to
Australian
Accounting
Standards
–
Annual
Improvements
to
Australian
Accounting
Standards
2012–2014
Cycle
[AASB
1,
AASB
2,
AASB
3,
AASB
5,
AASB
7,
AASB
11,
AASB
110,
AASB
119,
AASB
121,
AASB
133,
AASB
134,
AASB
137
&
AASB
140]
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
Standard
makes
various
amendments
to
Accounting
Standards
as
part
of
the
International
Accounting
Standards
Board
(IASB)
International
Financial
Reporting
Standards
(IFRSs)
Annual
Improvements
to
IFRSs
2012–
2014
Cycle
including:
•
•
•
•
IFRS
5
–
reclassification
from
held
for
sale
to
held
for
distribution
to
owners
or
from
held
for
distribution
to
owners
to
held
for
sale
is
considered
to
the
continuation
of
the
original
plan
of
disposal;
IFRS
7
–
adds
basis
of
conclusion
to
clarify
disclosure
requirements
for
transferred
financial
assets
and
offsetting
arrangements;
IAS
19
–
confirms
that
high
quality
corporate
bonds
or
national
government
bonds
used
to
determine
discount
rates
must
be
in
the
same
currency
as
the
benefits
paid
to
the
employee;
and
IAS
34
–
clarifies
information
about
cross
references
in
the
interim
financial
report.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2015-‐2
Amendments
to
Australian
Accounting
Standards
–
Disclosure
Initiative:
Amendments
to
AASB
101
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
The
amendments
aim
at
clarifying
IAS
1
to
address
perceived
impediments
to
preparers
exercising
their
judgement
in
presenting
their
financial
reports
This
standard
is
not
expected
to
impact
the
Group.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
27
47
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
⎯ AASB
2015-‐3
Amendments
to
Australian
Accounting
Standards
arising
from
the
Withdrawal
of
AASB
1031
Materiality
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
July
2015)
This
Standard
completes
the
withdrawal
of
references
to
AASB
1031
in
all
Australian
Accounting
Standards
and
Interpretations,
allowing
that
Standard
to
effectively
be
withdrawn.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2015-‐4
Amendments
to
Australian
Accounting
Standards
–
Financial
Reporting
Requirements
for
Australian
Groups
with
a
Foreign
Parent
[AASB
127
&
AASB
128]
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
July
2015)
This
Standard
amends
AASB
128
to
require
that,
notwithstanding
paragraphs
17
and
Aus17.1
of
AASB
128,
the
ultimate
Australian
entity
shall
apply
the
equity
method
in
accounting
for
interests
in
associates
and
joint
ventures
if
either
the
entity
or
the
group
is
a
reporting
entity,
or
both
the
entity
and
group
are
reporting
entities.
This
standard
is
not
expected
to
impact
the
Group.
⎯ AASB
2015-‐5
Amendments
to
Australian
Accounting
Standards
–
Investment
Entities:
Applying
the
Consolidation
Exception
[AASB
10,
AASB
12
&
AASB
128]
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
January
2016)
This
Standard
amends
AASB
10,
AASB
12
and
AASB
128
to
confirm
that
the
exemption
from
preparing
consolidated
financial
statements
set
out
in
paragraph
4(a)
of
AASB
10
is
available
to
a
parent
entity
that
is
a
subsidiary
of
an
investment
entity,
to
clarify
the
applicability
of
AASB
12
to
the
financial
statements
of
an
investment
entity
and
to
introduce
relief
in
AASB
128
to
permit
a
non-‐investment
entity
investor
in
an
associate
or
joint
venture
that
is
an
investment
entity
to
retain
the
fair
value
through
profit
or
loss
measurement
applied
by
the
associate
or
joint
venture
to
its
subsidiaries..
This
standard
is
not
expected
to
impact
the
Group.
⎯ 2015-‐6
Amendments
to
Australian
Accounting
Standards
–
Extending
Related
Party
Disclosures
to
Not-‐for-‐Profit
Public
Sector
Entities
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
July
2016)
This
standard
makes
amendments
to
AASB
124
to
specify
consistent
related
party
disclosure
requirements
for
the
Australian
Government,
State
Governments,
local
councils
and
other
not-‐for-‐profit
public
sector
entities.
This
standard
is
not
expected
to
impact
the
Group.
⎯ 2015-‐7
Amendments
to
Australian
Accounting
Standards
–
Fair
Value
Disclosures
of
Not-‐for-‐Profit
Public
Sector
Entities
(applicable
for
annual
reporting
periods
commencing
on
or
after
1
July
2016)
This
Standard
relieves
not-‐for-‐profit
public
sector
entities
from
the
certain
disclosure
requirements
contained
in
AASB
13
for
assets
within
the
scope
of
AASB
116
that
are
held
primarily
for
their
current
service
potential
rather
than
to
generate
future
net
cash
inflows.
This
standard
is
not
expected
to
impact
the
Group.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
28
48
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
The
Group
does
not
anticipate
early
adoption
of
any
of
the
above
Australian
Accounting
Standards
or
Interpretations.
The
group
has
adopted
all
of
the
new
revised
or
amending
accounting
standards
and
interpretations
issued
by
the
Australian
Accounting
Standards
Board
that
are
mandatory
for
the
current
reporting
period.
The
adoption
of
these
accounting
standards
and
interpretations
did
not
have
any
significant
impact
on
the
financial
performance
or
position
of
the
group.
c. Basis
of
consolidation
The
consolidated
financial
statements
comprise
the
financial
statements
of
Medibio
Limited
and
its
controlled
entities
as
at
30
June
2015
(the
“Group”).
Subsidiaries
are
all
those
entities
(including
special
purpose
entities)
over
which
the
Group
has
control.
The
Group
controls
an
entity
when
it
is
exposed
to
or
has
rights
to
variable
returns
from
its
involvement
with
the
entity
and
has
the
ability
to
affect
those
returns
through
the
power
to
direct
the
activities
at
the
entity.
The
financial
statements
of
the
subsidiaries
are
prepared
for
the
same
reporting
period
as
the
parent
company,
using
consistent
accounting
policies.
In
preparing
the
consolidated
financial
statements,
all
inter-‐company
balances
and
transactions,
income
and
expenses
and
profit
and
losses
resulting
from
intra-‐group
transactions
have
been
eliminated
in
full.
Subsidiaries
are
fully
consolidated
from
the
date
on
which
control
is
transferred
to
the
Group
and
cease
to
be
consolidated
from
the
date
on
which
control
is
transferred
out
of
the
Group.
d. Foreign
currency
translation
i. Functional
and
presentation
currency
Both
the
functional
and
presentation
currency
of
Medibio
Limited
and
its
subsidiaries
is
Australian
dollars
(A$).
Each
entity
in
the
Group
determines
its
own
functional
currency
using
the
currency
of
the
primary
economic
environment
in
which
the
entity
operates
and
items
included
in
the
financial
statements
of
each
entity
are
measured
using
that
functional
currency.
ii. Transactions
and
balances
Transactions
in
foreign
currencies
are
initially
recorded
in
the
functional
currency
at
the
exchange
rates
ruling
at
the
date
of
the
transaction.
Monetary
assets
and
liabilities
denominated
in
foreign
currencies
are
retranslated
at
the
rate
of
exchange
ruling
at
the
end
of
the
reporting
period.
All
exchange
differences
are
taken
to
profit
and
loss
when
incurred.
e. Segment
reporting
Operating
segments
are
identified
and
segment
information
is
disclosed
on
the
basis
of
internal
reports
that
are
regularly
provided
to,
or
reviewed
by,
the
Group’s
chief
operating
decision
maker
which,
for
the
Group,
is
the
board
of
directors.
In
this
regard,
such
information
is
provided
using
different
measures
to
those
used
in
preparing
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income,
and
Statement
of
Financial
Position.
Reconciliations
of
such
management
information
to
the
statutory
information
contained
in
the
annual
financial
statements
have
been
included.
f. Revenue
recognition
Revenue
is
recognised
to
the
extent
that
it
is
probable
that
the
economic
benefits
will
flow
to
the
Group
and
the
revenue
can
be
reliably
measured.
The
following
specific
recognition
criteria
must
also
be
met
before
revenue
is
recognised:
MEDIBIO
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REPORT
2015
29
49
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
i.
Sale
of
goods
Revenue
is
recognised
when
the
significant
risks
and
rewards
of
ownership
of
the
goods
have
passed
to
the
buyer
and
the
costs
incurred
or
to
be
incurred
in
respect
of
the
transaction
can
be
measured
reliably.
Risks
and
rewards
of
ownership
are
considered
passed
to
the
buyer
at
the
time
of
delivery
of
the
goods
to
the
customer.
ii.
Interest
income
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.
All
revenue
is
stated
net
of
the
amount
of
GST.
g. Government
grants
Government
grants
are
recognised
when
there
is
reasonable
assurance
that
the
grant
will
be
received
and
all
attaching
conditions
will
be
complied
with.
When
the
grant
relates
to
an
expense
item,
it
is
recognised
as
income
over
the
periods
necessary
to
match
the
grant
on
a
systematic
basis
to
the
costs
that
it
is
intended
to
compensate.
When
the
grant
relates
to
an
asset,
the
fair
value
is
credited
to
a
deferred
income
account
and
is
released
to
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income
over
the
expected
useful
life
of
the
relevant
asset
by
equal
annual
instalments.
h. Borrowing
costs
Borrowing
costs
directly
attributable
to
the
acquisition,
construction
and
production
of
assets
that
necessarily
take
a
substantial
period
of
time
to
prepare
for
their
intended
use
or
sale,
are
added
to
the
cost
of
those
assets,
until
such
time
as
the
assets
are
substantially
ready
for
their
intended
use
or
sale.
All
other
borrowing
costs
are
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income
in
the
period
in
which
they
are
incurred.
i. Cash
and
cash
equivalents
Cash
and
cash
equivalents
in
the
Statement
of
Financial
Position
comprise
cash
at
bank
and
in
hand
and
short-‐term
deposits
with
an
original
maturity
of
three
months
or
less
that
are
readily
convertible
to
known
amounts
of
cash
and
which
are
subject
to
an
insignificant
risk
of
change
in
value.
For
the
purpose
of
the
Statement
of
Cash
Flows,
cash
and
cash
equivalents
consist
of
cash
and
cash
equivalents
as
defined
above,
net
of
outstanding
bank
overdrafts.
j. Trade
and
other
receivables
Trade
receivables,
which
generally
have
30
day
terms
are
recognised
and
carried
at
original
invoice
amount
less
an
allowance
for
any
uncollectible
amounts.
Collectability
of
trade
receivables
is
reviewed
on
an
ongoing
basis.
Debts
that
are
known
to
be
uncollectible
are
written
off
when
identified.
An
allowance
for
doubtful
debts
is
made
when
there
is
objective
evidence
that
the
Group
will
not
be
able
to
collect
the
debts.
Investments
and
other
financial
assets
k.
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
Recognition
and
De-‐recognition
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
All
regular
way
purchases
and
sales
of
financial
assets
are
recognised
on
the
trade
date
i.e.
the
date
the
Group
commits
to
purchase
the
asset.
Regular
way
purchases
or
sales
are
purchases
or
sales
of
financial
assets
under
contracts
that
require
delivery
of
the
assets
within
the
period
established
generally
by
regulation
or
convention
in
the
market
place.
Financial
assets
are
derecognised
when
the
right
to
receive
cash
flows
from
the
financial
assets
have
MEDIBIO
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REPORT
2015
30
expired
or
been
transferred.
i.
Loans
and
receivables
50
Loans
and
receivables
including
loan
notes
and
loans
to
KMP
are
non-‐derivative
financial
assets
with
fixed
or
determinable
payments
that
are
not
quoted
in
an
active
market.
Such
assets
are
carried
at
amortised
cost
using
the
effective
interest
method.
Gains
and
losses
are
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income
when
the
loans
and
receivables
are
derecognised
or
impaired.
These
are
included
in
current
assets,
except
for
those
with
maturities
greater
than
12
months
after
the
end
of
the
reporting
period,
which
are
classified
as
non-‐current.
ii.
Available-‐for-‐sale
securities
Available-‐for-‐sale
investments
are
those
non-‐derivative
financial
assets,
principally
equity
securities
that
are
designated
as
available-‐for-‐sale
or
are
not
suitable
to
be
classified
as
any
of
the
three
preceding
categories.
After
initial
recognition
available-‐for-‐sale
securities
are
measured
at
fair
value
with
gains
or
losses
being
recognised
as
a
separate
component
of
equity
until
the
investment
is
derecognised
or
until
the
investment
is
determined
to
be
impaired,
at
which
time
the
cumulative
gain
or
loss
previously
reported
in
equity
is
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income.
The
fair
value
of
investments
that
are
actively
traded
in
organised
financial
markets
are
determined
by
reference
to
quoted
market
bid
prices
at
the
close
of
business
at
the
end
of
the
reporting
period.
For
investments
with
no
active
market,
fair
values
are
determined
using
valuation
techniques.
Such
techniques
include:
using
recent
arm’s
length
market
transactions;
reference
to
the
current
market
value
of
another
instrument
that
is
substantially
the
same;
discounted
cash
flow
analysis
and
option
pricing
models
making
as
much
use
of
available
and
supportable
market
data
as
possible
and
keeping
judgemental
inputs
to
a
minimum.
v.
Impairment
l.
Income
tax
(benefit).
At
the
end
of
each
reporting
period,
the
Group
assesses
whether
there
is
objective
evidence
that
a
financial
instrument
has
been
impaired.
In
the
case
of
available-‐for
sale
financial
instruments,
a
significant
or
prolonged
decline
in
the
value
of
the
instrument
is
considered
to
determine
whether
impairment
has
arisen.
Impairment
losses
are
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income.
The
income
tax
expense
(benefit)
for
the
year
comprises
current
income
tax
expense
and
deferred
tax
expense
Current
tax
assets
and
liabilities
for
the
current
and
prior
periods
are
measured
at
the
amount
expected
to
be
recovered
from
or
paid
to
the
taxation
authorities.
The
tax
rates
and
tax
laws
used
to
compute
the
amount
are
those
that
are
enacted
or
substantively
enacted
by
the
end
of
the
reporting
period.
Deferred
income
tax
is
provided
on
all
temporary
differences
at
the
end
of
the
reporting
period
between
the
tax
bases
of
assets
and
liabilities
and
their
carrying
amounts
for
financial
reporting
purposes.
Deferred
income
tax
liabilities
are
recognised
for
all
taxable
temporary
differences
except:
• when
the
deferred
income
tax
liability
arises
from
the
initial
recognition
of
goodwill
or
of
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
profit
nor
taxable
profit
or
loss;
or
• when
the
taxable
temporary
difference
is
associated
with
investments
in
subsidiaries,
associates
or
interests
in
joint
ventures,
and
the
timing
of
the
reversal
of
the
temporary
difference
cannot
be
controlled
and
it
is
probable
that
the
temporary
difference
will
not
reverse
in
the
foreseeable
future.
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N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
market
place.
Financial
assets
are
derecognised
when
the
right
to
receive
cash
flows
from
the
financial
assets
have
expired
or
been
transferred.
i.
Loans
and
receivables
Loans
and
receivables
including
loan
notes
and
loans
to
KMP
are
non-‐derivative
financial
assets
with
fixed
or
determinable
payments
that
are
not
quoted
in
an
active
market.
Such
assets
are
carried
at
amortised
cost
using
the
effective
interest
method.
Gains
and
losses
are
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income
when
the
loans
and
receivables
are
derecognised
or
impaired.
These
are
included
in
current
assets,
except
for
those
with
maturities
greater
than
12
months
after
the
end
of
the
reporting
period,
which
are
classified
as
non-‐current.
ii.
Available-‐for-‐sale
securities
Available-‐for-‐sale
investments
are
those
non-‐derivative
financial
assets,
principally
equity
securities
that
are
designated
as
available-‐for-‐sale
or
are
not
suitable
to
be
classified
as
any
of
the
three
preceding
categories.
After
initial
recognition
available-‐for-‐sale
securities
are
measured
at
fair
value
with
gains
or
losses
being
recognised
as
a
separate
component
of
equity
until
the
investment
is
derecognised
or
until
the
investment
is
determined
to
be
impaired,
at
which
time
the
cumulative
gain
or
loss
previously
reported
in
equity
is
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income.
The
fair
value
of
investments
that
are
actively
traded
in
organised
financial
markets
are
determined
by
reference
to
quoted
market
bid
prices
at
the
close
of
business
at
the
end
of
the
reporting
period.
For
investments
with
no
active
market,
fair
values
are
determined
using
valuation
techniques.
Such
techniques
include:
using
recent
arm’s
length
market
transactions;
reference
to
the
current
market
value
of
another
instrument
that
is
substantially
the
same;
discounted
cash
flow
analysis
and
option
pricing
models
making
as
much
use
of
available
and
supportable
market
data
as
possible
and
keeping
judgemental
inputs
to
a
minimum.
v.
Impairment
At
the
end
of
each
reporting
period,
the
Group
assesses
whether
there
is
objective
evidence
that
a
financial
instrument
has
been
impaired.
In
the
case
of
available-‐for
sale
financial
instruments,
a
significant
or
prolonged
decline
in
the
value
of
the
instrument
is
considered
to
determine
whether
impairment
has
arisen.
Impairment
losses
are
recognised
in
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income.
l.
Income
tax
The
income
tax
expense
(benefit)
for
the
year
comprises
current
income
tax
expense
and
deferred
tax
expense
(benefit).
Current
tax
assets
and
liabilities
for
the
current
and
prior
periods
are
measured
at
the
amount
expected
to
be
recovered
from
or
paid
to
the
taxation
authorities.
The
tax
rates
and
tax
laws
used
to
compute
the
amount
are
those
that
are
enacted
or
substantively
enacted
by
the
end
of
the
reporting
period.
Deferred
income
tax
is
provided
on
all
temporary
differences
at
the
end
of
the
reporting
period
between
the
tax
bases
of
assets
and
liabilities
and
their
carrying
amounts
for
financial
reporting
purposes.
Deferred
income
tax
liabilities
are
recognised
for
all
taxable
temporary
differences
except:
• when
the
deferred
income
tax
liability
arises
from
the
initial
recognition
of
goodwill
or
of
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
profit
nor
taxable
profit
or
loss;
or
• when
the
taxable
temporary
difference
is
associated
with
investments
in
subsidiaries,
associates
or
interests
in
joint
ventures,
and
the
timing
of
the
reversal
of
the
temporary
difference
cannot
be
controlled
and
it
is
probable
that
the
temporary
difference
will
not
reverse
in
the
foreseeable
future.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
31
51
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
Deferred
income
tax
assets
are
recognised
for
all
deductible
temporary
differences,
carry-‐forward
of
deferred
tax
assets
and
unused
tax
losses,
to
the
extent
that
it
is
probable
that
taxable
profit
will
be
available
against
which
the
deductible
temporary
differences
and
the
carry-‐forward
of
unused
deferred
tax
assets
and
unused
tax
losses
can
be
utilised,
except:
•
when
the
deferred
income
tax
asset
relating
to
the
deductible
temporary
difference
arises
from
the
initial
recognition
of
an
asset
or
liability
in
a
transaction
that
is
not
a
business
combination
and,
at
the
time
of
the
transaction,
affects
neither
the
accounting
profit
nor
taxable
profit
or
loss;
or
• when
the
deductible
temporary
difference
is
associated
with
investments
in
subsidiaries,
associates
or
interests
in
joint
ventures,
in
which
case
a
deferred
tax
asset
is
only
recognised
to
the
extent
that
it
is
probable
that
the
temporary
difference
will
reverse
in
the
foreseeable
future
and
taxable
profit
will
be
available
against
which
the
temporary
difference
can
be
utilised.
The
carrying
amount
of
deferred
income
tax
assets
is
reviewed
at
the
end
of
each
reporting
period
and
reduced
to
the
extent
that
it
is
no
longer
probable
that
sufficient
taxable
profit
will
be
available
to
allow
all
or
part
of
the
deferred
income
tax
asset
to
be
utilised.
Unrecognised
deferred
income
tax
assets
are
reassessed
at
the
end
of
each
reporting
period
and
are
recognised
to
the
extent
that
it
has
become
probable
that
future
taxable
profit
will
allow
the
deferred
tax
asset
to
be
recovered.
Deferred
income
tax
assets
and
liabilities
are
measured
at
the
tax
rates
that
are
expected
to
apply
to
the
year
when
the
asset
is
realised
or
the
liability
is
settled,
based
on
tax
rates
(and
tax
laws)
that
have
been
enacted
or
substantively
enacted
at
the
end
of
the
reporting
period.
Income
taxes
relating
to
items
recognised
directly
in
equity
are
recognised
in
equity
and
not
in
profit
or
loss.
Deferred
tax
assets
and
deferred
tax
liabilities
are
offset
only
if
a
legally
enforceable
right
exists
to
set
off
current
tax
assets
against
current
tax
liabilities
and
the
deferred
tax
assets
and
liabilities
relate
to
the
same
taxable
entity
and
the
same
taxation
authority.
Research
and
development
tax
offset
claims
are
recognised
as
a
tax
benefit
when
it
is
probable
that
the
economic
benefits
will
flow
into
the
entity
and
the
amount
can
be
reliably
measured.
Medibio
Limited
and
the
controlled
entities
in
the
tax
consolidated
Group
continue
to
account
for
their
own
current
and
deferred
tax
amounts.
The
Group
has
applied
the
Group
allocation
approach
in
determining
the
appropriate
amount
of
current
taxes
and
deferred
taxes
to
allocate
to
members
of
the
tax
consolidated
Group.
m. Other
taxes
Revenues,
expenses
and
assets
are
recognised
net
of
the
amount
of
GST
except
when
the
GST
incurred
on
a
purchase
of
goods
and
services
is
not
recoverable
from
the
taxation
authority,
in
which
case
the
GST
is
recognised
as
part
of
the
cost
of
acquisition
of
the
asset
or
as
part
of
the
expense
item
as
applicable.
Receivables
and
payables
are
stated
with
the
amount
of
GST
included.
The
net
amount
of
GST
recoverable
from,
or
payable
to,
the
taxation
authority
is
included
as
part
of
receivables
or
payables
in
the
Statement
of
Financial
Position.
Cash
flows
are
included
in
the
Statement
of
Cash
Flows
on
a
gross
basis
and
the
GST
component
of
cash
flows
arising
from
investing
and
financing
activities,
which
is
recoverable
from,
or
payable
to,
the
taxation
authority
are
classified
as
operating
cash
flows.
Commitments
and
contingencies
are
disclosed
net
of
the
amount
of
GST
recoverable
from,
or
payable
to,
the
taxation
authority.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
32
52
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
n.
Intangible
assets
Intangible
assets
acquired
separately
or
in
a
business
combination
are
initially
measured
at
cost.
The
cost
of
an
intangible
asset
acquired
in
a
business
combination
is
its
fair
value
as
at
the
date
of
acquisition.
Following
initial
recognition,
intangible
assets
are
carried
at
cost
less
any
accumulated
amortisation
and
any
accumulated
impairment
losses.
Internally
generated
intangible
assets,
excluding
capitalised
development
costs,
are
not
capitalised
and
expenditure
is
charged
to
the
statement
of
profit
or
loss
and
other
comprehensive
income
in
the
year
in
which
expenditure
is
incurred.
Intangible
assets
with
indefinite
useful
lives
are
tested
for
impairment
annually
either
individually
or
at
the
cash-‐
generating
unit
level.
Such
intangibles
are
not
amortised.
The
useful
life
of
an
intangible
asset
with
an
indefinite
life
is
reviewed
at
the
end
of
each
reporting
period
to
determine
whether
the
indefinite
life
assessment
continues
to
be
supportable.
If
not,
the
change
in
the
useful
life
assessment
from
indefinite
to
finite
is
accounted
for
as
a
change
in
an
accounting
estimate
and
is
thus
accounted
for
on
a
prospective
basis.
Research
and
development
costs
Research
costs
are
expensed
as
incurred.
An
intangible
asset
arising
from
development
expenditure
on
an
internal
project
is
recognised
only
when
the
Group
can
demonstrate
the
technical
feasibility
of
completing
the
intangible
asset
so
that
it
will
be
available
for
use
or
sale,
its
intention
to
complete
and
its
ability
to
use
or
sell
the
asset,
how
the
asset
will
generate
future
economic
benefits,
the
availability
of
resources
to
complete
the
development
and
the
ability
to
measure
reliably
the
expenditure
attributable
to
the
intangible
asset
during
its
development.
Following
the
initial
recognition
of
the
development
expenditure,
the
cost
model
is
applied
requiring
the
asset
to
be
carried
at
cost
less
any
accumulated
amortisation
and
accumulated
impairment
losses.
Any
finite
life
expenditure
so
capitalised
is
amortised
over
the
period
of
expected
benefits
from
the
related
project.
The
carrying
value
of
an
intangible
asset
arising
from
development
expenditure
is
tested
for
impairment
annually
when
the
asset
is
not
yet
available
for
use,
or
more
frequently
when
an
indication
of
impairment
arises
during
the
reporting
period.
Gains
or
losses
arising
from
de-‐recognition
of
an
intangible
asset
are
measured
as
the
difference
between
the
net
disposal
proceeds
and
the
carrying
amount
of
the
asset
and
are
recognised
in
profit
and
loss
when
the
asset
is
derecognised.
Impairment
of
non-‐financial
assets
other
than
goodwill
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
assets
are
tested
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
to
sell
and
value
in
use.
For
the
purposes
of
assessing
impairment,
assets
are
grouped
at
the
lowest
levels
for
which
there
are
separately
identifiable
cash
inflows
that
are
largely
independent
of
the
cash
inflows
from
other
assets
or
groups
of
assets
(cash-‐
generating
units).
Non-‐financial
assets
other
than
goodwill
that
suffered
impairment
are
tested
for
possible
reversal
of
the
impairment
whenever
events
or
changes
in
circumstances
indicate
that
the
impairment
may
have
reversed.
o. Trade
and
other
payables
Trade
payables
and
other
payables
are
carried
at
amortised
cost
and
represent
liabilities
for
goods
and
services
provided
to
the
Group
prior
to
the
end
of
the
reporting
period
that
are
unpaid
and
arise
when
the
Group
becomes
obliged
to
make
future
payments
in
respect
of
the
purchase
of
the
goods
and
services.
The
amounts
are
unsecured
and
are
usually
paid
within
30
days
of
recognition.
Payables
to
related
parties
are
carried
at
the
principal
amount.
Interest,
when
charged
by
the
lender,
is
recognised
as
an
expense
on
an
accrual
basis.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
33
53
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
p.
Interest-‐bearing
loans
and
borrowings
All
loans
and
borrowings
are
initially
recognised
at
the
fair
value
of
the
consideration
received
less
directly
attributable
transaction
costs.
After
initial
recognition,
interest-‐bearing
loans
and
borrowings
are
subsequently
measured
at
amortised
cost
using
the
effective
interest
method.
Borrowings
are
classified
as
current
liabilities
unless
the
Group
has
an
unconditional
right
to
defer
settlement
of
the
liability
for
at
least
12
months
after
the
end
of
the
reporting
period.
q. Provisions
Provisions
are
recognised
when
the
Group
has
a
present
obligation
(legal
or
constructive)
as
a
result
of
a
past
event,
it
is
probable
that
an
outflow
of
resources
embodying
economic
benefits
will
be
required
to
settle
the
obligation
and
a
reliable
estimate
can
be
made
of
the
amount
of
the
obligation.
When
the
Group
expects
some
or
all
of
a
provision
to
be
reimbursed,
for
example
under
an
insurance
contract,
the
reimbursement
is
recognised
as
a
separate
asset
but
only
when
the
reimbursement
is
virtually
certain.
The
expense
relating
to
any
provision
is
presented
in
the
statement
of
profit
or
loss
and
other
comprehensive
income
net
of
any
reimbursement.
Provisions
are
measured
at
the
present
value
of
management's
best
estimate
of
the
expenditure
required
to
settle
the
present
obligation
at
the
end
of
the
reporting
period.
If
the
effect
of
the
time
value
of
money
is
material,
provisions
are
discounted
using
a
current
pre-‐tax
rate
that
reflects
the
time
value
of
money
and
the
risks
specific
to
the
liability.
The
increase
in
the
provision
resulting
from
the
passage
of
time
is
recognised
in
finance
costs.
r.
tEmployee
benefits
Wages,
salaries,
annual
leave
and
sick
leave
Liabilities
for
wages
and
salaries,
including
non-‐monetary
benefits,
annual
leave
and
long
service
leave
expected
to
be
settled
within
12
months
of
the
reporting
date
are
recognised
in
current
liabilities
in
respect
of
employees
services
up
to
the
reporting
date
and
are
measured
at
the
amount
expected
to
be
paid
when
the
liabilities
are
settled.
Long
service
leave
A
liability
for
long
service
leave
is
recognised,
and
is
measured
as
the
present
value
of
expected
future
payments
to
be
made
in
respect
of
services
provided
by
employees
up
to
the
end
of
the
reporting
period.
Consideration
is
given
to
expected
future
wage
and
salary
levels,
experience
of
employee
departures
and
periods
of
service.
Expected
future
payments
are
discounted
using
interest
rates
attaching,
as
at
the
end
of
the
reporting
period,
to
national
government
guaranteed
securities
with
terms
to
maturity
that
match,
as
closely
as
possible,
the
estimated
future
cash
outflows.
As
of
the
30
June
2015,
the
Group
did
not
have
any
employees
with
service
to
necessitate
a
provision
for
annual
leave
or
long
service
leave.
s.
Share-‐based
payment
transactions
Equity
settled
transactions
The
Group
provides
benefits
to
its
employees
and
directors
in
the
form
of
share-‐based
payments,
whereby
employees
and
directors
render
services
in
exchange
for
shares
or
rights
over
shares
(equity-‐settled
transactions).
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
34
54
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
t.
Contributed
equity
Ordinary
shares
are
classified
as
equity.
Incremental
costs
directly
attributable
to
the
issue
of
new
shares
or
options
are
shown
in
equity
as
a
deduction,
net
of
tax,
from
the
proceeds.
u. Earnings
per
share
Basic
earnings
per
share
(EPS)
is
calculated
as
net
profit
attributable
to
members
of
the
parent,
adjusted
to
exclude
costs
of
servicing
equity
(other
than
dividends)
and
preference
share
dividends,
divided
by
the
weighted
average
number
of
ordinary
shares,
adjusted
for
any
bonus
element.
Diluted
EPS
is
calculated
as
net
profit
attributable
to
members
of
the
parent,
adjusted
for:
• costs
of
servicing
equity
(other
than
dividends);
•
the
after
tax
effect
of
dividends
and
interest
associated
with
dilutive
potential
ordinary
shares
that
have
been
recognised
as
expenses;
and
• other
non-‐discretionary
changes
in
revenues
or
expenses
during
the
period
that
would
result
from
the
dilution
of
potential
ordinary
shares;
divided
by
the
weighted
average
number
of
ordinary
shares
and
dilutive
potential
ordinary
shares,
adjusted
for
any
bonus
element.
v. Business
combinations
Business
combinations
occur
where
an
acquirer
obtains
control
over
one
or
more
businesses.
A
business
combination
is
accounted
for
by
applying
the
acquisition
method,
unless
it
is
a
combination
involving
entities
or
businesses
under
common
control.
The
business
combination
will
be
accounted
for
from
the
date
that
control
is
attained,
whereby
the
fair
value
of
the
identifiable
assets
acquired
and
liabilities
(including
contingent
liabilities)
assumed
is
recognised
(subject
to
certain
limited
exceptions).
When
measuring
the
consideration
transferred
in
the
business
combination,
any
asset
or
liability
resulting
from
a
contingent
consideration
arrangement
is
also
included.
Subsequent
to
initial
recognition,
contingent
consideration
classified
as
equity
is
not
remeasured
and
its
subsequent
settlement
is
accounted
for
within
equity.
All
transaction
costs
incurred
in
relation
to
the
business
µcombination
are
expensed
to
the
Statement
of
Profit
or
Loss
and
Other
Comprehensive
Income.
The
acquisition
of
a
business
may
result
in
the
recognition
of
goodwill
or
a
gain
from
a
bargain
purchase.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
35
55
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
w. 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
principle
market
or
in
the
absence
of
a
principle
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
interest.
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
is
available
to
measure
fair
value,
and
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
each
reporting
date
and
transfers
between
levels
are
determined
based
on
a
reassessment
of
the
lowest
level
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.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
36
56
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
3.
SIGNIFICANT
ACCOUNTING
JUDGEMENTS,
ESTIMATES
AND
ASSUMPTIONS
In
applying
the
Group's
accounting
policies
management
continually
evaluates
judgments,
estimates
and
assumptions
based
on
experience
and
other
factors,
including
expectations
of
future
events
that
may
have
an
impact
on
the
Group.
All
judgments,
estimates
and
assumptions
made
are
believed
to
be
reasonable
based
on
the
most
current
set
of
circumstances
available
to
management.
Actual
results
may
differ
from
the
judgments,
estimates
and
assumptions.
Significant
judgments,
estimates
and
assumptions
made
by
management
in
the
preparation
of
these
financial
statements
are
outlined
below:
Significant
accounting
judgment
Impairment
of
assets
and
investments
The
Group
determines
whether
non-‐current
assets
(excluding
goodwill
and
indefinite
useful
life
intangible
assets)
should
be
tested
for
impairment
based
on
identified
impairment
triggers.
At
the
end
of
each
reporting
period
management
assesses
the
impairment
triggers
based
on
their
knowledge
and
judgement.
Where
an
impairment
trigger
is
identified,
an
estimate
of
the
recoverable
amount
is
required.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
37
57
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
4.
SEGMENT
REPORTING
Segment
Information
Identification
of
reportable
segments
The
Group
has
identified
its
operating
segments
based
on
the
internal
reports
that
are
reviewed
and
used
by
the
board
of
directors
(chief
operating
decision
makers)
in
assessing
performance
and
determining
the
allocation
of
resources.
The
Group
is
managed
primarily
on
the
basis
of
product
category
and
service
offerings
since
the
diversification
of
the
Group’s
operations
inherently
have
notably
different
risk
profiles
and
performance
assessment
criteria.
Operating
segments
are
therefore
determined
on
the
same
basis.
Reportable
segments
disclosed
are
based
on
aggregating
operating
segments
where
the
segments
are
considered
to
have
similar
economic
characteristics
and
are
also
similar
with
respect
to
the
following:
the
products
sold
and/or
services
provided
by
the
segment;
the
manufacturing
process;
•
•
•
•
the
distribution
method;
and
• external
regulatory
requirements.
the
type
or
class
of
customer
for
the
products
or
service;
Types
of
products
and
services
by
segment
i.
Mining
and
Gas
Exploration
This
market
segment
includes
the
income
and
expenditures
pertaining
to
the
investment
opportunity
through
Frontier
Oil
Corporation.
This
asset
is
available
for
sale
and
fully
impaired
in
these
accounts.
ii.
Human
Diagnostics
This
market
segment
includes
the
income
and
expenditures
pertaining
to
the
investment
opportunity
through
Invatec
Health
Pty
Ltd.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
38
58
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
Basis
of
accounting
for
purposes
of
reporting
by
operating
segments
Accounting
policies
adopted
Unless
stated
otherwise,
all
amounts
reported
to
the
Board
of
Directors
as
the
chief
decision
maker
with
respect
to
operating
segments
are
determined
in
accordance
with
accounting
policies
that
are
consistent
with
those
adopted
in
the
annual
financial
statements
of
the
Group.
Inter-‐segment
transactions
For
the
reporting
period
there
have
not
been
any
inter-‐segment
sales.
Salaries
for
research
and
development
employees
have
been
allocated
to
market
segments
on
the
basis
of
time
sheets
that
support
claims
for
the
research
and
development
tax
offset
credit.
Corporate
employee
costs
such
as
directors’
fees,
salaries
and
superannuation
are
allocated
to
market
segments
on
the
basis
of
direct
expenses
and
research
and
development
salaries
as
a
percentage
of
total
expenses
for
the
Group.
Inter-‐segment
loans
payable
and
receivable
are
initially
recognised
at
the
consideration
received
net
of
transaction
costs.
Segment
assets
In
the
majority
of
instances,
segment
assets
are
clearly
identifiable
on
the
basis
of
their
nature
(i.e.
prepayments,
inventories,
sundry
debtors).
Corporate
fixed
assets
such
as
computer
equipment
and
furniture
and
fittings
have
not
been
allocated
to
market
segments.
Segment
liabilities
Liabilities
are
allocated
to
segments
where
there
is
direct
nexus
between
the
liability
incurred
and
the
operations
of
the
segment.
Segment
liabilities
include
trade
and
other
payables.
Unallocated
Items
The
following
items
of
revenue,
expense,
assets
and
liabilities
are
not
allocated
to
operating
segments
as
they
are
not
considered
part
of
the
core
operations
of
any
segment:
Interest
received;
• Cash
and
term
deposits;
•
• prepayments;
• Fixed
assets;
• Borrowings;
and
• Other
payables.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
39
59
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
i.
Segment
performance
Twelve
months
ended
30
June
2015
Revenue
External
sales
R
&
D
Grant
Total
segment
revenue
Inter-‐segment
elimination
Unallocated
revenue
Total
consolidated
revenue
Twelve
months
ended
30
June
2015
Segment
net
profit/(loss)before
tax
Reconciliation
of
segment
result
to
Group
net
loss
before
tax
Amounts
not
included
in
segment
result
but
reviewed
by
the
Board:
• Amortisation
Unallocated
items:
•
Interest
received
• Other
corporate
costs
Net
loss
before
tax
Mining
and
Gas
$
Human
Diagnostics
$
-‐
-‐
-‐
-‐
-‐
255,120
-‐
-‐
Total
$
-‐
255,120
255,120
-‐
6,813
261,933
Mining
and
Gas
$
(3,861,034)
Human
Diagnostics
$
(2,244,216)
Total
$
(6,105,250)
(516,461)
-‐
(1,306,804)
(7,921,702)
Twelve
months
ended
30
June
2014
Revenue
External
sales
Total
segment
revenue
Inter-‐segment
elimination
Unallocated
revenue
Total
consolidated
revenue
Mining
and
Gas
$
Human
Diagnostics
$
Total
$
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
40
60
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
Twelve
months
ended
30
June
2014
Segment
net
loss
before
tax
Reconciliation
of
segment
result
to
group
net
loss
before
tax
Amounts
not
included
in
segment
result
but
reviewed
by
the
Board:
• Depreciation
Unallocated
items:
•
Interest
received
• Other
corporate
costs
Net
loss
before
tax
i.
Segment
assets
30
June
2015
Segment
assets
Unallocated
assets
• Cash
• Other
Total
assets
30
June
2014
Segment
assets
Unallocated
assets
• Cash
• Other
Total
assets
ii.
Segment
Liabilities
30
June
2015
Segment
liabilities
Unallocated
liabilities
Total
liabilities
30
June
2014
Segment
liabilities
Unallocated
liabilities
Total
liabilities
Mining
and
Gas
$
463,194
Human
Diagnostics
$
(82,091)
Total
$
381,103
-‐
6,976
(816,411)
(428,332)
Total
$
14,231,122
944,301
9,091
15,184,514
Mining
and
Gas
$
-‐
Human
Diagnostics
$
14,231,122
$
3,861,034
$
943,750
$
4,804,784
96,249
141,484
5,042,517
Total
$
5,566,909
5,566,909
$
-‐
2,332,246
2,332,246
Mining
and
Gas
$
Human
Diagnostics
$
5,566,909
$
$
-‐
-‐
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
41
61
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
ii.
Revenue
by
geographical
region
Australia
Revenue
for
the
2015
year
included
the
R&D
Grant
rebate
of
$255,120
and
bank
interest
of
$6,813.
For
the
2014
year,
revenue
included
profit
of
$463,194
from
the
sale
of
Frontier
Oil
Corporation
shares
and
bank
interest
of
$6,976.
iii.
Assets
by
geographical
region
All
assets
reside
in
one
geographical
region
being
Australia,
other
than
the
investment
in
Frontier
Oil
Corporation.
5.
REVENUES
AND
EXPENSES
(a)
Revenue
Bank
interest
received
and
receivable
R&D
Grant
received
Gain
on
disposal
of
Frontier
Oil
Corporation
Shares
(b)
Finance
costs
Interest
charges
payable
under
convertible
notes
(c)
Impairment
Frontier
Oil
Corporation
Goodwill
(d)
Employee
benefits
expense
Wages
and
salaries
Directors
fees
Superannuation
(e)
Other
expenses
Consulting
and
advisory
expenses
Legal
fees
Listing
fees
Share
registry
charges
Sales
and
marketing
Other
administration
expenses
CONSOLIDATED
2015
$
2014
$
6,813
255,120
-‐
261,933
6,976
-‐
463,194
470,170
(160,622)
(160,622)
(107,221)
(107,221)
(3,861,034)
(444,999)
(4,306,033)
(82,192)
(399,781)
(10,462)
(492,435)
(1,288,074)
(165,541)
(63,605)
(86,795)
(85,290)
(808,115)
(2,497,420)
-‐
-‐
-‐
-‐
(138,833)
-‐
(138,833)
(253,044)
(93,160)
(23,976)
(27,435)
(23,787)
(215,955)
(637,357)
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
42
62
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
6.
INCOME
TAX
Numerical
reconciliation
between
aggregate
tax
expense
recognised
in
the
statement
of
profit
or
loss
and
other
comprehensive
income
and
tax
expense
calculated
per
the
statutory
income
tax
rate
A
reconciliation
between
tax
expense
and
the
product
of
accounting
loss
before
income
tax
multiplied
by
the
Group’s
applicable
income
tax
rate
is
as
follows:
Accounting
loss
before
tax
At
the
statutory
tax
rate
of
30%
(2014:
30%)
Tax
effect
of
temporary
differences
and
current
year
loss
not
brought
to
account
Deferred
tax
asset
arising
from
tax
losses
not
brought
to
account
at
the
end
of
the
reporting
period
as
realisation
is
not
regarded
as
probable
The
potential
deferred
tax
asset
will
only
be
obtained
if:
CONSOLIDATED
2015
$
2014
$
(7,921,702)
(2,376,511)
(2,376,511)
(428,332)
(128,500)
(128,500)
2,376,511
128,500
251,400
6,804,040
i.
ii.
iii.
future
assessable
income
is
derived
of
a
nature
and
of
an
amount
sufficient
to
enable
the
benefit
to
be
realised;
the
conditions
for
deductibility
imposed
by
tax
legislation
continue
to
be
complied
with;
and
no
changes
in
tax
legislation
adversely
affect
the
Group
in
realising
the
benefit.
The
Group’s
tax
losses
arising
in
Australia
of
$23,211,110
at
30
June
2014
cannot
be
carried
forward
as
a
result
of
the
March
2015
acquisition
and
reconstruction
of
Medibio
Limited.
The
continued
availability
of
these
carried
forward
losses
depended
on
the
ability
of
the
parent
to
satisfy
the
requirements
of
the
continuity
of
ownership
test
(COT)
or
alternatively
the
same
business
test
(SBT).
It
is
unable
to
satisfy
either
of
these
tests.
At
30
June
2015,
there
is
no
recognised
or
unrecognised
deferred
tax
liability
(2014:
nil)
for
taxes
that
would
be
payable
on
the
unremitted
earnings
of
certain
of
the
Group’s
subsidiaries,
as
the
Group
has
no
liability
for
additional
taxation
should
such
amounts
be
remitted.
Tax
consolidation
Effective
1
July
2003,
for
the
purposes
of
income
taxation,
Medibio
Limited
and
its
100%
owned
subsidiaries
have
formed
a
tax
consolidated
group.
Members
of
the
group
have
entered
into
a
tax
sharing
arrangement
in
order
to
allocate
income
tax
expense
to
the
wholly-‐owned
subsidiaries
on
a
pro-‐rata
basis.
In
addition
the
agreement
provides
for
the
allocation
of
income
tax
liabilities
between
the
entities
should
the
head
entity
default
on
its
tax
payment
obligations.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
43
63
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
Tax
accounting
by
members
of
the
tax
consolidated
group
Members
of
the
tax
consolidated
Group
have
entered
into
a
tax
funding
arrangement.
The
tax
funding
arrangement
provides
for
the
allocation
of
current
taxes
to
members
of
the
tax
consolidated
Group
in
accordance
with
the
available
fractions
belonging
to
each
subsidiary,
which
is
directly
linked
to
prior
year
losses
that
have
been
accumulated.
In
the
event
of
the
Company
generating
future
taxable
profits,
the
tax
losses
will
be
absorbed
according
to
the
available
fractions
within
the
Group.
The
allocation
of
taxes
under
the
tax
funding
agreement
is
recognised
as
an
increase/decrease
in
the
subsidiaries’
intercompany
accounts
with
the
tax
consolidated
Group
head
company,
Medibio
Limited.
The
Group
has
applied
the
Group
allocation
approach
in
determining
the
appropriate
amount
of
current
taxes
to
allocate
to
members
of
the
tax
consolidated
Group.
7.
EARNINGS
PER
SHARE
Net
loss
attributable
to
equity
holders
of
the
Company
Weighted
average
number
of
ordinary
shares
used
in
calculating
basic
and
diluted
earnings
per
share:
8.
CASH
AND
CASH
EQUIVALENTS
Cash
at
bank
and
in
hand
Short-‐term
deposits
COMPANY
2015
$
2014
$
(7,921,702)
(428,332)
Number
of
Shares
Number
of
Shares
46,611,766
2,903,662,290
CONSOLIDATED
2015
$
210,696
733,605
944,301
2014
$
6,343
89,906
96,249
Cash
at
bank
earns
interest
at
floating
rates
based
on
daily
bank
deposit
rates.
Short-‐term
deposits
are
made
for
varying
periods
of
between
one
month
and
three
months,
depending
on
the
immediate
cash
requirements
of
the
Group,
and
earn
interest
at
the
respective
short-‐term
deposit
rates.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
44
64
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
(a)
Reconciliation
of
loss
after
tax
to
net
cash
flows
from
operations:
Net
loss
Adjustments
for:
Amortisation
Interest
received
Interest
paid
convertible
notes
Impairment
of
investments
Impairment
of
receivables
Share
based
payments
Profit
on
sale
of
investments
Changes
in
assets
and
liabilities:
(Increase)/
decrease
in
trade
and
other
receivables
(Decrease)
/
increase
in
trade
and
other
payables
(Decrease)
/
increase
in
employee
entitlements
Net
cash
used
in
operating
activities
(b)
Non
cash
financing
and
investing
activities
*Issue
of
25,000,000
shares
to
Heartlink
as
option
fee
*Issue
of
125,000,000
shares
to
Heartlink
for
exercise
of
option
*Issue
of
150,000,000
shares
to
Invatec
for
exercise
of
option
150,000
shares
issued
to
C
Indermaur
493,100
shares
issued
to
S
Pearce
250,000
options
ex
at
$0.30
issued
to
J
Campbell
1,000,000
options
ex
at
$0.30
issued
to
SEK
Investments
Limited
1,500,000
options
ex
at
$0.30
issued
to
Ausepen
Pty
Ltd
CONSOLIDATED
2015
$
(7,921,702)
516,461
(6,813)
160,622
4,306,033
100,000
524,600
-‐
2014
$
(428,332)
-‐
(6,976)
107,221
-‐
-‐
-‐
(463,194)
(336,680)
1,142,396
8,225
171,799
28,516
-‐
(1,515,083)
(611,257)
CONSOLIDATED
2015
$
-‐
-‐
-‐
45,000
147,930
43,600
174,400
261,600
672,530
2014
$
50,000
250,000
300,000
-‐
-‐
-‐
-‐
-‐
600,000
The
value
placed
on
the
issue
of
the
shares
was
equal
to
the
prevailing
share
price
of
Medibio
as
at
the
date
of
issue.
9.
TRADE
AND
OTHER
RECEIVABLES
Trade
debtors
Other
debtors
CONSOLIDATED
2015
$
2014
$
-‐
232,985
232,985
-‐
132,393
132,393
Terms
and
conditions
(i)
(ii)
Trade
debtors
are
non-‐interest
bearing
and
generally
on
30
day
terms.
A
provision
for
impairment
is
made
when
there
is
objective
evidence
that
a
trade
receivable
is
impaired.
Other
debtors
are
non-‐interest
bearing
and
have
repayment
terms
of
30
days.
A
provision
for
impairment
is
made
when
there
is
objective
evidence
that
a
debtor
is
impaired.
None
of
the
trade
and
other
receivables
are
contractually
overdue.
(iii)
Due
to
the
short-‐term
nature
of
these
receivables
their
carrying
amounts
are
assumed
to
approximate
their
fair
value
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
45
65
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
10. OTHER
FINANCIAL
ASSET
–
AVAILABLE
FOR
SALE
FINANCIAL
ASSETS
Frontier
Oil
Corporation
–
at
directors
valuation
Australian
listed
shares
at
fair
value
Impairment
Invatec
Health
Pty
Ltd
(i)
Frontier
Oil
Corporation
Notes
(i)
(ii)
(iii)
CONSOLIDATED
2015
$
3,861,034
2,758
(3,863,792)
-‐
-‐
2014
$
3,861,034
2,758
(2,758)
600,000
4,461,034
The
company
acquired
430,000,000
shares
in
Frontier
Oil
Corporation
(‘FOC’)
for
a
total
investment
cost
of
$5,188,265
during
the
year
ended
30
June
2013.
In
September
2013,
the
Company
sold
110,000,000
of
its
430,000,000
shares
held
in
FOC
for
net
funds
of
$1,690,425.
The
investment
is
carried
at
original
cost
less
disposals.
This
is
an
investment
in
an
unlisted
entity
and
is
therefore
difficult
to
obtain
fair
value.
The
directors,
after
reviewing
the
market
and
the
recent
drop
in
oil
prices,
have
fully
impaired
the
investment.
(ii)
Listed
Shares
As
at
30
June
2015,
Medibio
holds
47,544
Solagran
Limited
shares.
Solagran
Limited
is
in
voluntary
suspension
and
the
investment
has
been
full
impaired.
This
is
the
residual
balance
from
a
development
agreement
to
commercialise
CGNC
terminated
in
2010.
(iii)
Invatec
Health
Pty
Ltd
During
2014,
the
Company
entered
into
a
2
stage
transaction
to
acquire
an
investment
in
Invatec
Health
Pty
Ltd
(‘Invatec’).
The
first
stage
was
for
the
right
to
subscribe
for
a
35%
interest
in
Invatec
(stage
1
subscription).
The
investment
to
fund
Invatec
and
independent
validation
trials
is
capped
to
a
maximum
of
$3,500,000
over
two
years.
Accordingly,
for
every
$50,000
funded,
it
will
be
entitled
to
a
0.5%
interest
in
Invatec.
As
at
30
June
2014,
the
Group
was
entitled
to
an
approximately
6%
shareholding
in
Invatec
As
approved
by
shareholders
on
6
March
2015,
Medibio
acquired
100%
of
the
issued
capital
of
Invatec
by
the
issue
of
25,537,506
post
consolidation
shares
(28.4%
of
the
issued
capital
of
Medibio)
Refer
Note
11
-‐
Business
Combination.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
46
66
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
11.
BUSINESS
COMBINATIONS
Principal
activity
Date
of
acquisition
Proportion
of
shares
acquired
Consideration
$
Consideration
shares
issued
Number
2015
Invatec
Health
Pty
Ltd
Annapanna
Pty
Ltd
Patent
holder
&
developer
of
Depression
Algorithm
Research
&
development
provider
2
April
2015
100%
7,661,250
25,537,500
2
April
2015
100%
445,000
1,450,000
8,106,250
26,987,500
Invatec
Health
Pty
Ltd
was
acquired
by
the
issue
of
25,537,500
fully
paid
ordinary
shares
to
its
five
shareholders.
Medibio
gained
control
of
the
patents,
research
and
the
intellectual
property
including
patent
data
files
owned
by
the
entity.
As
part
of
the
acquisition
the
Invatec
Shareholders
are
also
entitled
to
18,000,000
Milestone
shares
payable
in
3
equal
tranches.
The
Milestone
objectives
must
be
achieved
by
31
December
2019.
The
Milestones
are:
(i)
(ii)
(iii)
Tranche
1
-‐
Milestone
Shares
will
be
issued
on
the
completion
of
a
clinical
trial
conducted
by
a
reputable
research
organisation
either
in
Australia
or
in
the
United
States
of
America
or,
a
body
which
is
not
related
to
either
Invatec
or
the
Company
which
is
designed
to
verify
the
CHR
Technology;
Tranche
2
-‐
Milestone
Shares
will
be
issued
on
the
completion
of
the
development
of
a
series
of
algorithms
that
are
capable
of
being
documented
and
patented
as
proprietary
intellectual
property
of
sufficient
quality,
as
determined
by
a
reputable
research
organisation
either
in
Australia
or
in
the
United
States
of
America
or
a
body
which
is
not
related
to
either
Invatec
or
the
Company
to
allow
automated
diagnosis
as
necessary
for
the
commercialisation
of
the
CHR
Technology;
and
Tranche
3
-‐
Milestone
Shares
will
be
issued
on
the
CHR
Technology
being
granted
approval
to
commercially
exploit
the
CHR
Technology
so
as
to
commence
operations
in
either
Australia
and
New
Zealand
and/or
either
of
the:
a)
b)
c)
US
Food
and
Drug
Administration;
Australian
Therapeutic
Goods
Association;
or
Conformitee
European
or
generally
known
as
“CE
Mark”
or
if
necessary,
European
Medicines
Agency.
Annapanna
Pty
Ltd
was
the
Invatec
Health
Pty
Ltd
due
diligence
contractor
responsible
for
initial
investigation
of
the
technology
and
contacting
the
researchers
who
performed
data
analysis
and
researched
the
algorithms
developed.
Its
purchase
secured
control
of
all
the
intellectual
property
generated
in
that
process.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
47
67
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
Assets
acquired
and
liabilities
assumed
at
the
date
of
acquisition
Invatec
Health
Pty
Ltd
$
Annapanna
Pty
Ltd
$
Current
Assets
Cash
&
cash
equivalents
Trade
and
other
receivables
Non-‐Current
Assets
Intangible
–
R&D
expenditure
Non-‐Current
Liabilities
Trade
and
other
payables
Borrowings
Other
liabilities
Non-‐Current
Liabilities
Borrowings
Goodwill
arising
on
acquisition
Option
to
acquire
costs
Consideration
Less:
fair
value
of
identifiable
net
assets
acquired
392
26,755
1,797,942
(280,705)
(362,843)
(13,410)
(395,000)
773,131
1
-‐
-‐
-‐
-‐
-‐
-‐
1
Total
$
393
26,755
1,797,942
(280,705)
(362,843)
(13,410)
(395,000)
773,132
Invatec
Health
Pty
Ltd
$
Annapanna
Pty
Ltd
$
Total
$
400,000
7,661,250
(773,131)
-‐
400,000
445,000
8,106,250
(1)
(773,132)
Fair
value
of
intangibles
acquired
7,288,119
7,288,119
Less:
Impairment
of
goodwill
Goodwill
arising
on
acquisition
-‐
-‐
(444,999)
(444,999)
-‐
-‐
The
fair
value
of
the
shares
issued
was
determined
by
reference
to
the
current
cost
of
obtaining
the
data
files
.The
Invatec
data
files
have
been
collected
over
the
past
15
years
and
consist
of
24
hours
of
ECG
data
and
either
a
corresponding
diagnosis
or
stress
rating.
Revenue
since
acquisition
date
was
$141,367
and
the
amount
of
profit
of
the
acquisition
since
acquisition
date
included
in
the
group
loss
was
$92,627.
Had
all
business
combinations
occurred
at
the
beginning
of
the
year
the
loss
would
have
increased
by
$277,759.
These
results
all
relate
to
Invatec
Health
Pty
Ltd.
The
net
assets
of
Invatec
Health
Pty
Ltd
recognised
in
the
financial
statements
are
a
provisional
assessment
of
their
fair
value
as
the
Company
is
in
the
process
of
finalising
the
valuation
of
intangible
assets
acquired.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
48
68
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
12.
INTANGIBLES
Licence
Heartlink
Limited
At
cost
Amortisation
Impairment
Net
carrying
amount
Development
Costs
At
cost
Additions
Impairment
Net
carrying
amount
Patents
At
cost
Additions
Amortisation
Impairment
Net
carrying
amount
Data
files
At
cost
Additions
Impairment
Net
carrying
amount
Goodwill
At
cost
Additions
Impairment
Net
carrying
amount
Reconciliation
of
carrying
amount
Net
carrying
amount
at
beginning
of
year
Additions
Amortisation
Impairment
Net
carrying
amount
Heartlink
Licence
CONSOLIDATED
2015
$
2014
$
300,000
(150,000)
-‐
150,000
43,750
3,078,052
-‐
3,121,802
-‐
3,298,153
(366,461)
-‐
2,931,692
-‐
7,794,643
-‐
7,794,643
-‐
444,999
(444,999)
-‐
300,000
-‐
-‐
300,000
-‐
43,750
-‐
43,750
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
343,750
14,615,847
(516,461)
(444,999)
13,998,137
-‐
343,750
-‐
-‐
343,750
Heartlink
Limited
is
an
Australian
public
unlisted
company.
It
is
the
registered
holder
of
the
Patents
of
an
algorithm
associated
with
the
HRV
technology.
The
Patents
are
held
in
Australia,
Israel
and
New
Zealand.
These
Patents
are
in
relation
to
technology
that
provides
a
method
for
diagnosing
psychiatric
disorders
by
the
analysis
of
heart
rate
patterns.
This
Patented
Technology,
which
is
complementary
to
the
processes
being
developed
by
Invatec.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
49
69
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
Development
Costs
The
algorithm
and
diagnostic
system
development
costs
incurred
in
the
year
by
the
development
team
have
been
capitalised.
Patents
The
company
announced
in
April
2015,
it
acquisition
of
the
US
and
Canadian
patents
which
complete
the
consolidation
of
granted
intellectual
property
that
the
company
has
targeted
to
support
Medibio’s
commercialisation
strategy
for
its
proprietary
depression
and
mental
health
diagnostic
technologies.
13.
TRADE
AND
OTHER
PAYABLES
–
CURRENT
Trade
payables
Other
creditors
and
accruals
Accrued
interest
Related
party
payables
Note
(i)
(ii)
(iii)
CONSOLIDATED
2015
$
1,541,792
388,308
12,211
1,942,311
437,969
2,380,280
2014
$
140,884
152,237
103,564
396,685
34,555
431,240
Terms
and
conditions
relating
to
the
above
financial
instruments
i.
ii.
iii.
Trade
creditors
are
non-‐interest
bearing
and
normally
settled
on
30
day
terms.
Other
creditors
are
non-‐interest
bearing
and
have
repayment
terms
between
30
and
90
days.
This
amount
reflects
interest
accrual
on
the
convertible
notes
that
have
been
issued
as
detailed
in
Note
14.
Interest
is
only
payable
on
the
date
of
maturity
of
notes.
Due
to
the
short
term
nature
of
these
payables
their
carrying
value
is
assumed
to
approximate
their
fair
value.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
50
70
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
14.
BORROWINGS
Borrowings
–
Current
Borrowings
–
Non-‐Current
Series
A
–
Convertible
Notes
Invatec
Shareholders
loan
Series
B
–
Convertible
Notes
Promissory
Note
Invatec
Shareholders
loan
CONSOLIDATED
2014
$
-‐
197,500
197,500
2013
$
1,500,000
-‐
1,500,000
-‐
3,298,153
197,500
3,495,653
395,000
-‐
-‐
395,000
Total
Borrowings
3,693,153
1,895,000
Convertible
Notes
All
the
Series
A
and
Series
B
Convertible
Notes
were
converted
into
securities
on
2
April
2015.
This
was
approved
by
shareholders
at
the
General
Meeting
held
6
March
2015
for
the
notes
not
approved
at
the
earlier
15
November
2013
meeting.
Promissory
Note
On
21
April
2015
Medibio
announced
the
acquisition
of
US
and
Canadian
patents
which
completed
the
consolidation
of
granted
intellectual
property
that
the
company
had
targeted
to
support
the
commercialisation
strategy
of
Medibio’s
proprietary
depression
and
mental
health
diagnostic
technologies.
The
term
of
the
note
is
3
years
with
8%
interest
payable
semi-‐annually.
Medibio
can
extend
the
period
for
an
additional
2
years
incurring
an
additional
2%
interest.
The
patent
owner
can
elect
to
be
paid
in
cash
or
Medibio
shares
at
$0.31
per
share.
Invatec
Shareholders
loan
Under
the
terms
of
the
acquisition
of
the
Invatec
Health
Pty
Ltd
(‘Invatec’)
the
outstanding
shareholder
loans
were
reduced
to
$395,000,
with
half
payable
13
months
after
completion
(due
2
May
2016)
of
the
acquisition
and
the
balance
26
months
after
completion.
The
carrying
value
is
considered
a
reasonable
approximation
to
the
fair
value
of
the
loan.
15. OTHER
PAYABLES
(NON-‐CURRENT)
Other
creditors
and
accruals
CONSOLIDATED
2015
$
-‐
2014
$
6,006
This
amount
reflects
the
interest
accrual
on
the
convertible
notes
that
were
on
issue,
as
detailed
in
Note
14
above.
Interest
is
only
payable
on
the
date
of
maturity
on
the
notes.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
51
71
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
2015
$
2014
$
51,093,889
37,250,977
NUMBER
OF
SHARES
2015
2014
3,173,189,372
2,873,174,372
2015
$
37,250,977
2014
$
36,650,527
16.
ISSUED
CAPITAL
Issued
and
paid
up
capital
a.
Ordinary
shares
issued
and
fully
paid
b.
Movements
in
shares
on
issue
Beginning
of
the
financial
year
Issued
during
the
year:
-‐
options
exercised
-‐
share
issues
to
Heartlink
-‐
share
issues
to
Invatec
-‐
share
placement
-‐
Convertible
note
–
Series
B
(i)
(ii)
Share
Consolidation
100:1
-‐
-‐
333,333,333
8,333,333
3,514,856,036
(3,479,707,089)
15,000
150,000,000
150,000,000
-‐
-‐
-‐
-‐
Post-‐consolidation
shares
on
issue
35,148,947
Share
placement
Share
issues
to
acquire
Invatec
Convertible
note
–
Series
B
Convertible
note
–
Series
A
Contractor/consultant
payments
share
issues
to
acquire
company
Convertible
note
interest
Option
exercise
Less:
share
issue
costs
End
of
the
financial
year
(iii)
(iv)
(v)
(v)
(vi)
(vii)
(viii)
8,256,668
25,537,500
3,516,665
15,000,000
643,100
1,450,000
113,388
136,658
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
89,802,932
3,173,189,372
-‐
-‐
1,000,000
25,000
-‐
-‐
2,477,000
7,661,250
1,055,000
1,500,000
192,930
435,000
34,016
13,666
(550,950)
51,093,889
450
300,000
300,000
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
37,250,977
Notes
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
On
10
October
2014,
the
Company
issued
333,333,333
ordinary
shares
at
an
issue
price
of
0.03
cent
per
shares.
This
issue
raised
$1,000,000
(before
issue
costs).
This
placement
was
completed
post
the
share
consolidation
raising
a
further
$2,477,000
at
$0.30
per
share
On
24
November
2014,
a
Convertible
note
holder,
converted
$25,000
of
Notes.
All
the
Convertible
Notes
were
converted
to
securities
in
April
2015
On
2
April
2015
the
company
raised
$2,477,000
by
the
placement
of
8,256,668
shares
to
sophisticated
and
professional
investors.
Refer
to
Note
11
–
Business
combination
–
acquisition
of
Invatec
Health
Pty
Ltd
Conversion
of
All
Series
A
and
B
convertible
notes
as
approved
by
shareholder
at
a
General
Meeting
of
6
March
2015.
Refer
to
Note
11
–
Business
combination
–
acquisition
of
Annapanna
Pty
Ltd
Interest
on
Convertible
notes
paid
by
issue
of
shares
at
$0.30
per
share.
Option
exercised
on
issue
by
application
of
accrued
Convertible
Notes
interest
of
$13,666
due
to
the
holder.
All
shares
issued
above
rank
equally
in
all
respects
with
the
shares
on
issue
at
the
beginning
of
the
year.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
52
72
A N N U A L R E P O R T 2 0 1 5
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
c.
Capital
management
When
managing
capital,
management’s
objective
is
to
ensure
the
entity
continues
as
a
going
concern
as
well
as
to
maintain
optimal
returns
to
shareholders
and
benefits
for
other
stakeholders.
The
company’s
debt
and
capital
includes
ordinary
share
capital
and
financial
liabilities,
supported
by
financial
assets.
There
are
no
externally
imposed
capital
requirements.
Going
concern
statement
As
at
30
June
2015
the
Group
had
net
asset
position
of
$9,111,081
(2014:
$2,710,271).
However,
as
at
30
June
2015,
it
had:
•
incurred
a
loss
for
the
year
of
$7,921,702
(2014:
$428,332);
• cash
outflow
from
operations
of
$1,515,083
(2014:
$611,257);
• cash
at
bank
of
$944,301
(2014
$96,249);
•
• borrowings
(non-‐current)
from
the
acquisition
of
patents
of
$3,298,153,
and
shareholder
loans
of
$197,500;
and
• Current
liabilities
in
excess
of
current
assets
by
$1,391,403
(2014:
$1,693,507)
trade
creditors
of
$2,320,280
(2014
$431,240);
The
Group’s
ability
to
continue
as
a
going
concern
is
dependent
upon
the
generation
of
cash
from
operations,
the
sufficiency
of
current
cash
reserves
to
meet
existing
obligations,
the
ability
to
reschedule
planned
research
and
development
activity,
raising
of
further
equity
and
receipt
of
research
and
development
tax
incentives.
In
Note
24
the
Group
has
disclosed
that
since
year
end
it
has
raised
$3,092,035
through
the
issue
of
$7,730,087
shares
on
8
September
2015.
Accordingly,
Directors
believe
the
Group
will
be
able
to
pay
its
debts
as
and
when
they
fall
due
for
a
period
of
at
least
12
months
from
the
date
of
these
financial
statements.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
53
73
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
d.
Share
Options
Options
over
ordinary
shares:
2015
No.
of
Options
2014
No.
of
Options
Unlisted
Options
Exercisable
on
or
before
1
April
2017
at
30
cents
per
share
Outstanding
at
beginning
of
the
year
Issued
during
the
year
Lapsed
during
the
year
Outstanding
at
end
of
the
year
Exercisable
on
or
before
1
April
2018
at
10
cents
per
share
Outstanding
at
beginning
of
the
year
Issued
during
the
year
Exercised
during
the
year
Lapsed
during
the
year
Outstanding
at
end
of
the
year
Exercisable
on
or
before
31
December
2013
at
5
cents
per
share
Outstanding
at
beginning
of
the
year
Issued
during
the
year
Lapsed
during
the
year
Outstanding
at
end
of
the
year
Exercisable
on
or
before
31
December
2013
at
3
cents
per
share
Outstanding
at
beginning
of
the
year
Issued
during
the
year
Lapsed
during
the
year
Outstanding
at
end
of
the
year
Listed
Options
Exercisable
on
or
before
31
December
2013
at
3
cents
per
share
Outstanding
at
beginning
of
the
year
*Exercised
during
the
year
Lapsed
during
the
year
Outstanding
at
end
of
the
year
Total
options
over
unissued
ordinary
shares
-‐
6,666,667
-‐
6,666,667
-‐
15,000,000
(136,658)
-‐
14,863,342
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
-‐
29,248,571
-‐
(29,248,571)
-‐
19,000,000
-‐
(19,000,000)
-‐
-‐
-‐
-‐
-‐
21,530,009
1,270,813,556
(15,000)
(1,270,798,556)
-‐
-‐
Movements
in
share
options
• On
31
December
2013
2
series
of
the
unlisted
options
and
1
series
of
listed
option
expired
and
lapsed.
• On
the
2
April
2015,
all
Series
A
Convertible
Note
holders
received
an
option
attached
to
every
share
issued
in
the
conversion.
Option
terms
are:
-‐
the
options
expire
1
April
2018
and
are
convertible
on
payment
of
10
cents.
• As
part
of
the
April
2015
capital
raising
shares,
certain
shares
were
issued
with
attached
options.
Option
terms
are:
-‐
the
options
expire
1
April
2017
and
are
convertible
on
payment
of
30
cents.
• On
2
April
2015
a
Convertible
Note
holder
receiving
options
as
part
of
the
conversion
terms,
applied
accrued
interest
payable
of
$13,666
and
exercised
136,658
options.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
54
74
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
e.
Terms
and
conditions
of
contributed
equity
Ordinary
shares
have
the
right
to
receive
dividends
as
declared
and,
in
the
event
of
winding
up
of
the
Company,
to
participate
in
the
proceeds
from
the
sale
of
all
surplus
assets
in
proportion
to
the
number
of
and
amounts
paid
up
on
shares
held,
after
all
other
creditors
have
been
paid.
Ordinary
shares
entitle
their
holder
to
one
vote,
either
in
person
or
by
proxy,
at
a
meeting
of
the
Company.
Ordinary
shares
have
no
par
value.
17.
AUDITORS’
REMUNERATION
The
auditor
of
Medibio
Limited
is
William
Buck
(Qld)
Amounts
received
or
due
and
receivable
for:
-‐
audit
or
review
of
the
financial
report
of
the
entity
and
any
other
entity
in
the
Group
Other
services
in
relation
to
the
entity
and
any
other
entity
in
the
Group:
-‐
tax
compliance
-‐
AGM
attendance
18.
KEY
MANAGEMENT
PERSONNEL
Short-‐term
employee
benefits
Post-‐employment
benefits
Share-‐based
payments
Total
compensation
Detail’s
of
related
party
payables
can
be
found
in
Note
13.
CONSOLIDATED
2015
$
2014
$
29,161
37,184
12,575
690
42,426
8,150
595
45,929
311,061
2,774
88,600
402,435
138,833
-‐
-‐
138,833
19.
RELATED
PARTY
DISCLOSURES
The
consolidated
financial
statements
include
the
financial
statements
of
Medibio
Limited
(the
ultimate
parent
company)
and
the
subsidiaries
listed
in
the
following
table.
Name
BioProspect
Australia
Pty
Ltd**
Australian
Phytochemicals
Pty
Ltd**
BioProspect
America
Pty
Ltd**
Re
Gen
Wellness
Products
Pty
Ltd**
Medibio
Limited
–
USA***
Invatec
Health
Pty
Ltd***
Annapanna
Pty
Ltd***
Country
of
Incorporation
Australia
Australia
Australia
Australia
USA
-‐
Delaware
Australia
Australia
Class
of
Shares
Ord
Ord
Ord
Ord
Ord
Ord
Ord
2015
100
100
100
100
100
100
100
%
Equity
Interest
Investment
*
$
2015
2014
4,024,341
4,024,341
1,323,464
1,323,464
2
2
50,000
50,000
-‐
1,320
2014
100
100
100
100
-‐
6
-‐
8,061,250
445,000
600,000
-‐
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
55
75
NOTES
TO
THE
FINANCIAL
STATEMENTS
FOR
THE
YEAR
ENDED
30
JUNE
2015
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
56
*
Cost
before
provisioning.
Refer
to
Note
10
for
further
investment
disclosures.
**
Dormant
entities
***
Human
health
–
CHR
diagnostic
development
20. FINANCIAL
RISK
MANAGEMENT
OBJECTIVES
AND
POLICIES
The
Group’s
principal
financial
instruments
comprise
receivables,
payables,
cash,
investments
and
short-‐term
deposits.
The
main
risks
arising
from
the
Group’s
financial
instruments
are
credit
risk,
interest
rate
risk,
foreign
exchange
risk
and
liquidity
risk.
The
Group
uses
different
methods
to
measure
and
manage
different
types
of
risks
to
which
it
is
exposed.
These
include
monitoring
the
levels
of
exposure
to
interest
rates
and
assessments
of
market
forecast
for
interest
rates.
Liquidity
risk
is
monitored
through
the
development
of
future
rolling
cash
flow
forecasts
that
are
tabled
and
reviewed
at
each
board
meeting.
Risk
exposures
and
responses
Credit
risk
Credit
risk
arises
from
the
financial
assets
of
the
Group,
which
comprise
cash
and
cash
equivalents,
trade
and
other
receivables.
The
Group’s
maximum
exposures
to
credit
risk
at
the
end
of
the
reporting
period
in
relation
to
each
class
of
recognised
financial
assets
is
the
carrying
amount
of
those
assets
as
indicated
in
the
Statement
of
Financial
Position.
The
Group
minimises
concentrations
of
credit
risk
in
relation
to
trade
receivables
by
having
payment
terms
of
30
days
and
receivable
balances
are
monitored
on
an
ongoing
basis
with
the
result
that
the
Group
has
currently
never
had
an
exposure
to
bad
debts.
It
is
the
Group’s
policy
that
all
customers
who
wish
to
trade
on
credit
terms
are
subject
to
credit
verification
procedures.
Term
deposits
are
placed
with
major
financial
institutions
to
minimise
the
risk
of
default
of
counterparties.
Interest
rate
risk
The
Group’s
exposure
to
market
interest
rates
relates
primarily
to
the
Group’s
funds
held
on
term
deposit.
At
the
end
of
the
reporting
period
the
Group
had
the
following
mix
of
financial
assets
and
liabilities
exposed
to
interest
rate
risk:
CONSOLIDATED
2015
$
2014
$
Financial
assets
Cash
and
cash
equivalents
944,301
96,249
The
Group’s
policy
is
to
place
funds
on
interest-‐bearing
term
deposit
that
are
surplus
to
immediate
requirements.
The
Group’s
interest
rate
exposure
is
reviewed
near
the
maturity
date
of
term
deposits,
to
assess
whether
more
attractive
rates
are
available
without
increasing
risk.
The
following
sensitivity
analysis
is
based
on
the
interest
rate
exposures
in
existence
at
the
end
of
the
reporting
period:
At
30
June
2015,
if
interest
rates
had
moved,
as
illustrated
in
the
table
below,
with
all
other
variables
held
constant,
post-‐tax
loss
and
equity
would
have
been
affected
as
follows:
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
*
Cost
before
provisioning.
Refer
to
Note
10
for
further
investment
disclosures.
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
**
Dormant
entities
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
***
Human
health
–
CHR
diagnostic
development
20.
FINANCIAL
RISK
MANAGEMENT
OBJECTIVES
AND
POLICIES
The
Group’s
principal
financial
instruments
comprise
receivables,
payables,
cash,
investments
and
short-‐term
deposits.
The
main
risks
arising
from
the
Group’s
financial
instruments
are
credit
risk,
interest
rate
risk,
foreign
exchange
risk
and
liquidity
risk.
The
Group
uses
different
methods
to
measure
and
manage
different
types
of
risks
to
which
it
is
exposed.
These
include
monitoring
the
levels
of
exposure
to
interest
rates
and
assessments
of
market
forecast
for
interest
rates.
Liquidity
risk
is
monitored
through
the
development
of
future
rolling
cash
flow
forecasts
that
are
tabled
and
reviewed
at
each
board
meeting.
Risk
exposures
and
responses
Credit
risk
Credit
risk
arises
from
the
financial
assets
of
the
Group,
which
comprise
cash
and
cash
equivalents,
trade
and
other
receivables.
The
Group’s
maximum
exposures
to
credit
risk
at
the
end
of
the
reporting
period
in
relation
to
each
class
of
recognised
financial
assets
is
the
carrying
amount
of
those
assets
as
indicated
in
the
Statement
of
Financial
Position.
The
Group
minimises
concentrations
of
credit
risk
in
relation
to
trade
receivables
by
having
payment
terms
of
30
days
and
receivable
balances
are
monitored
on
an
ongoing
basis
with
the
result
that
the
Group
has
currently
never
had
an
exposure
to
bad
debts.
It
is
the
Group’s
policy
that
all
customers
who
wish
to
trade
on
credit
terms
are
subject
to
credit
verification
procedures.
Term
deposits
are
placed
with
major
financial
institutions
to
minimise
the
risk
of
default
of
counterparties.
Interest
rate
risk
The
Group’s
exposure
to
market
interest
rates
relates
primarily
to
the
Group’s
funds
held
on
term
deposit.
At
the
end
of
the
reporting
period
the
Group
had
the
following
mix
of
financial
assets
and
liabilities
exposed
to
interest
rate
risk:
Financial
assets
Cash
and
cash
equivalents
CONSOLIDATED
2015
$
2014
$
944,301
96,249
The
Group’s
policy
is
to
place
funds
on
interest-‐bearing
term
deposit
that
are
surplus
to
immediate
requirements.
The
Group’s
interest
rate
exposure
is
reviewed
near
the
maturity
date
of
term
deposits,
to
assess
whether
more
attractive
rates
are
available
without
increasing
risk.
The
following
sensitivity
analysis
is
based
on
the
interest
rate
exposures
in
existence
at
the
end
of
the
reporting
period:
At
30
June
2015,
if
interest
rates
had
moved,
as
illustrated
in
the
table
below,
with
all
other
variables
held
constant,
post-‐tax
loss
and
equity
would
have
been
affected
as
follows:
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
56
76
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
Consolidated
+
1%
(100
basis
points)
-‐
0.5
%
(50
points)
Post
tax
loss
Higher/
(lower)
2015
$
9,443
(4,722)
2014
$
2,537
(1,903)
Equity
Higher/
(lower)
2015
$
2014
$
(9,443)
4,722
(2,537)
1,903
The
movements
in
losses
are
due
to
higher/
(lower)
interest
income
from
cash
balances.
There
is
no
impact
on
equity
other
than
impact
on
accumulated
losses.
Liquidity
risk
The
Group’s
objective
is
to
maintain
sufficient
funds
to
finance
its
current
operations
and
additional
funds
to
ensure
its
long-‐term
survival.
The
Group
has
no
finance
facilities
in
place
and
therefore
it
is
currently
dependent
on
capital
raisings
and
government
tax
incentives
for
short
term
survival.
Refer
to
note
16
for
further
details.
Foreign
Currency
Risk
The
Group
is
exposed
to
fluctuations
in
foreign
currencies
on
purchases
of
goods
in
currencies
other
than
the
Group’s
functional
currency.
The
group
manages
the
risk
by
monitoring
the
level
of
exposure
to
foreign
currency
transactions
and
limiting
where
possible.
Fair
value
The
carrying
amount
of
all
recognised
financial
assets
and
financial
liabilities
is
considered
a
reasonable
approximation
of
their
fair
value
due
to
their
short
term
nature.
21.
CONTINGENT
LIABILITIES
Other
than
disclosed
in
note
11,
there
were
no
known
contingent
liabilities
as
at
30
June
2015.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
57
77
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
N O T E S T O T H E F I N A N C I A L S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
F O R T H E Y E A R E N D E D 3 0 J U N E 2 0 1 5
22.
SHARE-‐BASED
PAYMENT
PLANS
Recognised
share-‐based
payment
expenses
a.
The
expense
recognised
for
employee
services
received
during
the
year
is
shown
below.
Expense
arising
from
equity-‐settled
share-‐based
payment
transactions
b.
The
cost
recognised
for
consulting
services
rendered
during
the
year.
25,000,000
shares
issued
to
Heartlink
for
exercise
of
option
125,000,000
shares
issued
to
Heartlink
for
exercise
of
option
150,000,000
shares
issued
to
Invatec
for
exercise
of
option
150,000
shares
issued
to
C
Indermaur
493,100
shares
issued
to
S
Pearce
250,000
options
ex
at
$0.30
issued
to
J
Campbell
1,000,000
options
ex
at
$0.30
issued
to
SEK
Investments
Limited
1,500,000
options
ex
at
$0.30
issued
to
Ausepen
Pty
Ltd
CONSOLIDATED
2015
$
-‐
-‐
-‐
-‐
45,000
147,930
43,600
174,400
261,600
2014
$
-‐
50,000
250,000
300,000
-
-‐
-‐
TOTAL
SHARE-‐BASED
PAYMENTS
672,530
600,000
Option
pricing
model
The
fair
value
of
the
equity-‐settled
share
options
granted
is
estimated
as
at
the
date
of
grant
using
a
Black-‐Scholes
model
taking
into
account
the
terms
and
conditions
upon
which
the
options
were
granted.
The
following
table
lists
the
inputs
to
the
model
used
for
the
year
ended
30
June
2015.
Black-‐Scholes
B
Dividend
yield
(%)
Expected
volatility
(%)
Risk-‐free
interest
rate
(%)
Expected
life
of
options
(years)
Option
exercise
price
($)
Weighted
average
share
price
at
measurement
date
(post-‐consolidation
prices)
0.00%
200%
2.634%
2
$0.30
$0.30
The
reserve
records
items
recognised
as
expenses
on
valuation
of
options.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
58
78
N O T E S
T O
T H E
F I N A N C I A L
S T A T E M E N T S
F O R
T H E
Y E A R
E N D E D
3 0
J U N E
2 0 1 5
A N N U A L R E P O R T 2 0 1 5
23.
PARENT
ENTITY
INFORMATION
Net
loss
attributable
to
members
of
Medibio
Limited
Change
in
market
value
of
available
for
sale
financial
assets
Total
comprehensive
income
for
the
year
attributable
to
members
of
Medibio
Limited
Current
assets
Total
assets
Current
liabilities
Total
liabilities
Issued
Capital
Share
based
payments
reserve
Retained
earnings
Total
equity
Contingent
liabilities
Capital
and
other
expenditure
commitments
not
provided
for
in
the
financial
statements
2014
$
(7,374,764)
-‐
(7,374,764)
920,651
14,470,274
1,420,273
4,718,427
51,093,889
479,600
(41,821,642)
9,751,847
-‐
2014
$
(430,118)
-‐
(430,118)
213,018
5,017,803
1,812,698
2,213,704
37,250,977
-‐
(34,446,878)
2,804,099
-‐
-‐
3,000
24.
EVENTS
AFTER
THE
END
OF
THE
REPORTING
PERIOD
Apart
from
the
matters
set
out
below,
there
are
no
matters
or
circumstances
that
have
arisen
since
the
end
of
the
financial
year
that
have
had
significantly
affected
either:
•
•
the
Group’s
operations
in
financial
year
2015;
or
future
prospects.
The
key
post
balance
date
event
is
the
issue
of
7,730,087
shares
at
$0.40
to
raise
$3,092,035
on
8
September
2015.
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
59
79
D I R E C T O R S ’
D E C L A R A T I O N
D I R E C T O R S ’
D E C L A R A T I O N
D I R E C T O R S ’ D E C L A R A T I O N
In
accordance
with
a
resolution
of
directors
of
Medibio
Limited,
I
state
that:
In
accordance
with
a
resolution
of
directors
of
Medibio
Limited,
I
state
that:
1.
1.
In
the
opinion
of
the
directors:
In
the
opinion
of
the
directors:
a.
a.
b.
b.
c.
c.
the
financial
statements,
notes
and
additional
disclosures
included
in
the
directors’
report
designated
as
the
financial
statements,
notes
and
additional
disclosures
included
in
the
directors’
report
designated
as
audited,
of
the
Company
are
in
accordance
with
the
Corporations
Act
2001
including:
audited,
of
the
Company
are
in
accordance
with
the
Corporations
Act
2001
including:
i.
i.
giving
a
true
and
fair
view
of
the
of
the
Group’s
financial
position
as
at
30
June
2015
and
of
its
giving
a
true
and
fair
view
of
the
of
the
Group’s
financial
position
as
at
30
June
2015
and
of
its
performance
for
the
year
ended
on
that
date;
and
performance
for
the
year
ended
on
that
date;
and
ii.
ii.
complying
with
Accounting
Standards
and
Corporations
Regulations
2001,
complying
with
Accounting
Standards
and
Corporations
Regulations
2001,
on
the
basis
of
those
outlined
in
note
16,
there
are
reasonable
grounds
to
believe
that
the
Company
will
be
on
the
basis
of
those
outlined
in
note
16,
there
are
reasonable
grounds
to
believe
that
the
Company
will
be
able
to
pay
its
debts
as
and
when
they
become
due
and
payable,
and
able
to
pay
its
debts
as
and
when
they
become
due
and
payable,
and
the
financial
statements
and
notes
to
the
financial
statements
are
prepared
in
compliance
with
the
financial
statements
and
notes
to
the
financial
statements
are
prepared
in
compliance
with
International
Financial
Reporting
Standards
as
made
by
the
International
Accounting
Standards
Board.
International
Financial
Reporting
Standards
as
made
by
the
International
Accounting
Standards
Board.
2.
2.
This
declaration
has
been
made
after
receiving
the
declarations
required
to
be
made
to
the
directors
in
This
declaration
has
been
made
after
receiving
the
declarations
required
to
be
made
to
the
directors
in
accordance
with
section
295A
of
the
Corporations
Act
2001
for
the
financial
year
ended
30
June
2015.
accordance
with
section
295A
of
the
Corporations
Act
2001
for
the
financial
year
ended
30
June
2015.
On
behalf
of
the
Board
On
behalf
of
the
Board
Chris
Indermaur
Chris
Indermaur
Chairman
Chairman
30th
September
2015
30th
September
2015
Sydney
NSW
Sydney
NSW
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
60
60
80
DIRECTORS’
DECLARATION
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
60
In
accordance
with
a
resolution
of
directors
of
Medibio
Limited,
I
state
that:
1.
In
the
opinion
of
the
directors:
a.
the
financial
statements,
notes
and
additional
disclosures
included
in
the
directors’
report
designated
as
audited,
of
the
Company
are
in
accordance
with
the
Corporations
Act
2001
including:
i.
giving
a
true
and
fair
view
of
the
of
the
Group’s
financial
position
as
at
30
June
2015
and
of
its
performance
for
the
year
ended
on
that
date;
and
ii.
complying
with
Accounting
Standards
and
Corporations
Regulations
2001,
b. on
the
basis
of
those
outlined
in
note
16,
there
are
reasonable
grounds
to
believe
that
the
Company
will
be
able
to
pay
its
debts
as
and
when
they
become
due
and
payable,
and
c.
the
financial
statements
and
notes
to
the
financial
statements
are
prepared
in
compliance
with
International
Financial
Reporting
Standards
as
made
by
the
International
Accounting
Standards
Board.
2.
This
declaration
has
been
made
after
receiving
the
declarations
required
to
be
made
to
the
directors
in
accordance
with
section
295A
of
the
Corporations
Act
2001
for
the
financial
year
ended
30
June
2015.
On
behalf
of
the
Board
Chris
Indermaur
Chairman
30th
September
2015
Sydney
NSW
I N D E P E N D E N T A U D I T O R ’ S
I N D E P E N D E N T
A U D I T O R ’ S
R E P O R T
T O
T H E
R E P O R T T O T H E M E M B E R S
M E M B E R S
O F
M E D I B I O
L I M I T E D
A N D
O F M E D I B I O L I M I T E D A N D
C O N T R O L L E D
E N T I T I E S
C O N T R O L L E D E N T I T I E S
A N N U A L R E P O R T 2 0 1 5
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
81
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
I N D E P E N D E N T A U D I T O R ’ S
I N D E P E N D E N T
A U D I T O R ’ S
R E P O R T
T O
T H E
R E P O R T T O T H E M E M B E R S
M E M B E R S
O F
M E D I B I O
L I M I T E D
A N D
O F M E D I B I O L I M I T E D A N D
C O N T R O L L E D
E N T I T I E S
C O N T R O L L E D E N T I T I E S
Auditor’s
Opinion
In
our
opinion:
a.
the
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
2015
and
of
its
performance
for
the
year
ended
on
that
date;
and
ii.
complying
with
Australian
Accounting
Standards
(including
the
Australian
Accounting
Interpretations)
and
the
Corporations
Regulations
2001;
and
b.
the
financial
report
also
complies
with
International
Financial
Reporting
Standards
as
disclosed
in
Note
1.
Emphasis
of
Matter
regarding
Going
Concern
Without
modifying
our
opinion,
we
draw
attention
to
Note
16(c)
in
the
financial
report
which
indicates
that
the
Group
incurred
losses
of
$7,921,702
(2014:
$428,332),
the
group’s
current
liabilities
exceeded
its
current
assets
by
$1,391,403
(2014:$1,693,507)
and
cash
outflows
from
operations
of
$1,515,083
(2014:
$611,257).
These
conditions,
along
with
other
matters
set
forth
in
Note
16(c)
indicate
the
existence
of
a
material
uncertainty
which
may
cast
significant
doubt
about
the
Group’s
ability
to
continue
as
a
going
concern
and
therefore
the
consolidated
entity
may
be
unable
to
realise
its
assets
and
discharge
its
liabilities
in
the
normal
course
of
business.
Report
on
the
Remuneration
Report
We
have
audited
the
Remuneration
Report
included
in
pages
29
to
35
of
the
directors’
report
for
the
year
ended
30
June
2015.
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.
Auditor’s
Opinion
In
our
opinion,
the
Remuneration
Report
of
Medibio
Limited
for
the
year
ended
30
June
2015,
complies
with
section
300A
of
the
Corporations
Act
2001.
Matters
Relating
to
the
Electronic
Presentation
of
the
Audited
Financial
Report
This
auditor’s
report
relates
to
the
financial
report
of
Medibio
Limited
for
the
year
ended
30
June
2015
included
on
Medibio
Limited’s
web
site.
The
company’s
directors
are
responsible
for
the
integrity
of
the
Medibio
Limited’s
web
site.
We
have
not
been
engaged
to
report
on
the
integrity
of
the
Medibio
Limited’s
web
site.
The
auditor’s
report
refers
only
to
the
financial
report.
It
does
not
provide
an
opinion
on
any
other
information
which
may
have
been
hyperlinked
to/from
these
statements.
If
users
of
this
report
are
concerned
with
the
inherent
risks
arising
from
electronic
data
communications
they
are
advised
to
refer
to
the
hard
copy
of
the
audited
financial
report
to
confirm
the
information
included
in
the
audited
financial
report
presented
on
this
web
site.
William
Buck
(Qld)
ABN
11
603
627
400
M.
Ayoob
A
Member
of
the
Firm
Dated
this
30th
day
of
September,
2015
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
62
82
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
INDEPENDENT
AUDITOR’S
REPORT
TO
THE
MEMBERS
OF
MEDIBIO
LIMITED
AND
CONTROLLED
ENTITIES
BIOPROSPECT
LIMITED
|
ANNUAL
REPORT
2014
61
Report
on
the
Financial
Report
We
have
audited
the
accompanying
consolidated
financial
report
comprising
of
Medibio
Limited
(the
Company)
and
the
entities
it
controlled
at
year’s
end
or
from
time
to
time
during
the
financial
year
(the
Group).
The
consolidated
financial
report
comprises
the
consolidated
statement
of
financial
position
as
at
30
June
2015,
the
consolidated
statement
of
profit
or
loss
and
other
comprehensive
income,
the
consolidated
statement
of
changes
in
equity
and
the
consolidated
statement
of
cash
flows
for
the
year
then
ended,
notes
comprising
a
summary
of
significant
accounting
policies
and
other
explanatory
information,
and
the
directors’
declaration.
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.
In
Note
1,
the
directors
also
state,
in
accordance
with
Accounting
Standard
AASB
101
Presentation
of
Financial
Statements,
that
the
financial
statements
comply
with
International
Financial
Reporting
Standards.
Auditor’s
Responsibility
Our
responsibility
is
to
express
an
opinion
on
the
financial
report
based
on
our
audit.
We
conducted
our
audit
in
accordance
with
Australian
Auditing
Standards.
Those
standards
require
that
we
comply
with
relevant
ethical
requirements
relating
to
audit
engagements
and
plan
and
perform
the
audit
to
obtain
reasonable
assurance
about
whether
the
financial
report
is
free
from
material
misstatement.
An
audit
involves
performing
procedures
to
obtain
audit
evidence
about
the
amounts
and
disclosures
in
the
financial
report.
The
procedures
selected
depend
on
the
auditor’s
judgement,
including
the
assessment
of
the
risks
of
material
misstatement
of
the
financial
report,
whether
due
to
fraud
or
error.
In
making
those
risk
assessments,
the
auditor
considers
internal
control
relevant
to
the
entity’s
preparation
of
the
financial
report
that
gives
a
true
and
fair
view
in
order
to
design
audit
procedures
that
are
appropriate
in
the
circumstances,
but
not
for
the
purpose
of
expressing
an
opinion
on
the
effectiveness
of
the
entity’s
internal
control.
An
audit
also
includes
evaluating
the
appropriateness
of
accounting
policies
used
and
the
reasonableness
of
accounting
estimates
made
by
the
directors,
as
well
as
evaluating
the
overall
presentation
of
the
financial
report.
We
believe
that
the
audit
evidence
we
have
obtained
is
sufficient
and
appropriate
to
provide
a
basis
for
our
audit
opinion.
Independence
In
conducting
our
audit,
we
have
complied
with
the
independence
requirements
of
the
Corporations
Act
2001
A N N U A L R E P O R T 2 0 1 5
A S X A D D I T I O N A L I N F O R M A T I O N
A S X
A D D I T I O N A L
I N F O R M A T I O N
Additional
information
required
by
the
Australian
Stock
Exchange
Ltd
and
not
shown
elsewhere
in
this
report
is
as
follows.
The
information
is
current
as
at
23
September
2015.
b. Distribution
of
equity
securities
The
numbers
of
shareholders,
by
size
of
holding,
in
each
class
of
share
are:
1
–
1,000
1,001
–
5,000
5,001
–
10,000
10,001
–
100,000
100,001
and
over
The
number
of
shareholders
holding
less
than
a
marketable
parcel
of
shares
of
1,137
shares
are:
c.
Twenty
largest
shareholders
–
ordinary
shares
quoted
on
ASX
The
names
of
the
twenty
largest
holders
of
quoted
shares
are:
1
2
ABN
Amro
Clearing
Sydney
Nominees
Pty
Ltd
Carakho
Holdings
Pty
Ltd
3
Moneybung
Pty
Ltd
4
5
6
7
Pitt
Street
Absolute
Return
Samma-‐Vayama
Pty
Ltd
UBS
Nominees
Pty
Ltd
Jutland
Nominees
Pty
Ltd
8
Mining
Investments
Limited
9
Bond
Street
Custodians
Limited
10
Kafta
Enterprises
Pty
Ltd
11
National
Nominees
Limited
12
Ms
Diane
Phyllis
Sherwood
13
Bernard
Laverty
Pty
Ltd
14
Australian
Associated
Finance
Pty
Ltd
15
Bond
Street
Custodians
Limited
16
Mr
Brady
Peter
Scanlon
17
LQ
Super
Pty
Ltd
18
Freeman
Road
Pty
Ltd
19
Mr
Neil
Thompson
20
Bond
Street
Custodians
Limited
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
ORDINARY
SHARES
No.
of
Holders
No.
of
Shares
1,910
626
188
324
98
3,146
1,959
488,883
1,566,847
1,473,329
11,414,045
83,278,243
98,221,347
541,924
Number
of
Shares
Held
%
Held
7,355,839
3,675,220
3,060,000
3,040,500
2,300,000
2,127,588
1,666,667
1,600,000
1,548,337
1,469,541
1,353,504
1,092,159
1,039,660
1,000,000
1,000,000
894,191
893,589
870,000
842,248
833,334
9.90
4.95
4.12
4.09
3.10
2.86
2.24
2.15
2.08
1.98
1.82
1.47
1.40
1.35
1.35
1.20
1.20
1.17
1.13
1.12
37,662,377
50.68
63
83
A S X A D D I T I O N A L I N F O R M A T I O N
A S X
A D D I T I O N A L
I N F O R M A T I O N
d. Options
There
are
21,530,009
options
currently
on
issue.
This
consists
of
14,863,342
Options
held
by
9
option
holders
expiring
1
April
2018
and
exercisable
on
the
payment
of
$0.10
and
6,666,667
Options
held
by
16
option
holders
expiring
1
April
2017
and
exercisable
on
the
payment
of
$0.30.
All
options
are
unlisted
e. Unquoted
Securities
There
are
23,929,979
ordinary
shares
in
2
holdings
subject
to
escrow
(unquoted
securities)
until
01
April
2016.
f.
Voting
Rights
All
ordinary
shares
carry
one
vote
per
share
without
restriction.
g.
Substantial
shareholders
The
following
shareholders
have
notified
the
company
as
being
substantial
holders
in
the
Company:
Name
Mr
Claude
Solitario
Dr
Stephen
Addis
Kris
Knauer
and
associated
entities
Number
12,580,664
12,318,734
6,440,541
Percentage
12.81
12.55
6.56
MEDIBIO
LIMITED
|
ANNUAL
REPORT
2015
64
84
C O R P O R A T E D I R E C T O R Y
ABN 58 008 130 336
This annual report covers Medibio Limited as a group
comprising Medibio Limited and its subsidiaries. The
Group’s functional and presentation currency is AUD ($).
Directors
C Indermaur
K Knauer
J Campbell
Chairman
Executive Director
Non-executive Director
Company Secretary
R Lees
Registered Office
Suite 605, 50 Clarence Street
Sydney NSW 2000
Telephone:
Facsimile:
+61 2 9299 9580
+61 2 9299 9501
Legal Advisers
HopgoodGanim Lawyers
Level 8, Waterfront Place
1 Eagle Street
Brisbane, QLD, 4000
Watermark Intellectual Asset Management
Level 2, 302 Burwood Road
Hawthorn VIC 3122
Bankers
Westpac Banking Corporation
Auditors
William Buck (Qld)
Level 21, 307 Queen Street
Brisbane QLD 4000
Home Exchange
Australian Securities Exchange
Exchange Plaza, 2 The Esplanade
Perth WA 6000
Internet Address
www.Medibio.com.au
Share Registry
Computershare Investor Services Pty Limited
117 Victoria Street
West End, QLD 4101
Telephone:
Facsimile:
1300 850 505
(03) 9473 2500
85
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