Company Information 02 Chairman’s Statement 03 Report of the Directors 07 Board of Directors 12 Corporate Governance Report 13 Report of the Independent Auditors 18 Consolidated Income Statement 24 Consolidated Statement of Comprehensive Income 25 Consolidated Statement of Changes in Equity 26 Company Statement of Changes in Equity 28 Consolidated Statement of Financial Position 29 Company Statement of Financial Position 31 Consolidated Statement of Cash Flows 32 Company Statement of Cash Flows 33 Notes to the Financial Statements 34 Notice of Annual General Meeting 85 Form of Proxy CONTENTS I 2 I DIRECTORS Abu Bakar bin Mohd Taib (Non-Executive Chairman) Dato’ Hussian @ Rizal bin A. Rahman (Chief Executive Officer) Derrick Chia Kah Wai (Deputy Chief Executive Officer) Seah Boon Chin (Non-Executive Director) Azlinda Ezrina binti Ariffin (Non-Executive Director) SECRETARY Computershare Company Secretarial Services (Jersey) Limited 13 Castle Street St Helier Jersey JE1 1ES Channel Islands REGISTERED 13 Castle Street OFFICE St Helier Jersey JE1 1ES Channel Islands BUSINESS 2-3, Incubator 2 ADDRESS Technology Park Malaysia Bukit Jalil 57000 Kuala Lumpur Malaysia Tel: +603 8996 3600 AUDITORS Jeffreys Henry LLP Finsgate 5-7 Cranwood Street London EC1V 9EE United Kingdom NOMINATED Allenby Capital Limited ADVISER 5 St. Helen’s Place AND BROKER London EC3A 6AB United Kingdom COMPANY INFORMATION For the year ended 31 December 2022 I 3 I CHAIRMAN’S STATEMENT For the year ended 31 December 2022 INTRODUCTION MobilityOne Limited's current organisation structure is depicted below: The Directors are pleased to present the audited consolidated financial statements for MobilityOne Limited for the year ended 31 December 2022. In the financial year ended 31 December 2022, the Group’s revenue decreased by £21.95 million to £233.76 million (year ended 31 December 2021: revenue of £255.71 million) as a result of lower sales from the Group’s main products and services, namely the mobile phone prepaid airtime reload and bill payment business through the Group's banking channels (i.e. mobile banking and internet banking) and electronic data capture terminals as well as third parties' e-wallet applications. This reduction in sales can be partly attributed to the departure of many foreign workers from Malaysia and reduced overall demand for the Group’s mobile phone prepaid products. The Malaysian market accounted for the majority of the Group’s entire revenue for the year ended 31 December 2022. As a consequence of the reduction of revenue, coupled with higher administrative expenses, the Group registered a much lower profit after tax of £16,626 in the year ended 31 December 2022 (year ended 31 December 2021: profit after tax of £1.51 million). The Group’s other businesses such as its international remittance services and e-money business in Malaysia and payment solution business in Brunei and the Philippines continued to remain small and did not make a material contribution to the Group in the year ended 31 December 2022. As at 31 December 2022, the Group had cash and cash equivalents (including fixed deposits) of £5.02 million (31 December 2021: cash and cash equivalents of £4.67 million) while the secured loans and borrowings from financial institutions increased to £3.87 million (31 December 2021: £2.18 million). I 4 I CHAIRMAN’S STATEMENT (CONTINUED) For the year ended 31 December 2022 REVIEW OF ACTIVITIES AND OUTLOOK The Group’s business activities are predominately concentrated in Malaysia. According to the Central Bank of Malaysia in May 2023 it was reported that the Malaysian economy is projected to expand between 4.0% to 5.0% in 2023, driven by firm domestic demand, improving employment conditions and income as well as continued implementation of multi-year projects which would support consumption and investment activity. Nonetheless, the inflation rate is expected to stay elevated. Mobile phone prepaid airtime reloads and bill payments will continue to be the main business activities for the Group in 2023. The Group’s international remittance and e-money businesses in Malaysia as well as the payment solution business in Brunei are expected to remain insignificant. The Group has discontinued to explore new business in the Philippines and has no immediate plan to expand its business there. On 1 June 2022 the Company announced, amongst other things, that MobilityOne Sdn Bhd (“M1 Malaysia”), the Group’s wholly-owned operating subsidiary in Malaysia, which received a licence from MasterCard Asia/Pacific Pte Ltd (“MasterCard”) to issue MasterCard prepaid cards, had obtained approval from the Central Bank of Malaysia to introduce international scheme prepaid cards under the MasterCard’s brand in Malaysia. The Group has commenced the issuance of MasterCard prepaid cards in Malaysia on a small scale to complement the Group's existing e-wallet and is part of the Group's end-to-end payment ecosystem. As part of the Group’s business plans for long-term growth, the Group has the following initiatives: (1) Money transfer business via SWIFT To expand the Group’s money transfer business via the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”) network, the Group continues to work with a bank in Malaysia on the integration process while waiting for the Central Bank of Malaysia’s approval, the timings of which continue to remain uncertain. The Company will make the relevant announcement on the arrangement with SWIFT as and when is appropriate. (2) UK electronic money institution application On 11 May 2023, the Company announced that M1 Tech Limited (“M1 Tech”), the Group’s wholly-owned subsidiary in the UK, had withdrawn its application to the Financial Conduct Authority (the “FCA”), the financial regulatory body in the UK, for authorisation as an electronic money institution to provide e-money services in the UK (the “FCA Application”). This follows receipt of further feedback from the FCA requesting further information in relation to certain disclosures relating to M1 Tech's proposed business plan. The Group is reviewing its proposed business plan to expand its business on the UK through M-One Tech and its options in relation to submitting a further revised FCA application in due course which addresses the FCA’s latest feedback. The Group will release further announcements as and when appropriate. (3) New joint venture to explore business opportunities from the Kingdom of Saudi Arabia On 26 June 2023 M1 Malaysia entered into a joint venture cum shareholders agreement with Syed Faisal Algadrie Bin Syed Hassan (“Syed Faisal”) to incorporate a new joint venture company in Malaysia to be named "Qube Nexus Sdn Bhd" (“Qube”) to explore any suitable business opportunities for Qube mainly from the Kingdom of Saudi Arabia. M1 Malaysia and Syed Faizal will own 80 per cent. and 20 per cent. of the equity interest in Qube, respectively. I 5 I CHAIRMAN’S STATEMENT (CONTINUED) For the year ended 31 December 2022 (4) Proposed disposal of OneShop Retail Sdn Bhd (“1Shop”) and proposed joint venture with Super Apps Holdings Sdn Bhd (“Super Apps”) On 19 October 2022 M1 Malaysia entered into a Share Sale Agreement with Super Apps for the proposed disposal by M1 Malaysia of a 60% shareholding in the Group’s wholly-owned non-core subsidiary 1Shop to Super Apps (together the “Proposed Disposal”). Concurrently, M1 Malaysia entered into a Joint-Venture cum Shareholders Agreement with Super Apps and 1Shop (together the “Proposed Joint Venture”). The Proposed Disposal and Proposed Joint Venture are inter-conditional in order to establish a new joint venture to expand the Group’s e-products and services business initially in Malaysia. The Proposed Disposal is subject to the completion of a merger exercise between Technology & Telecommunication Acquisition Corporation (“TETE”) and Super Apps (together the “Merger Exercise”). Pursuant to the terms of the Proposed Disposal and subject to the completion of the Merger Exercise, the Group is expected to receive cash proceeds of RM40.0 million (c. £7.53 million) and RM20.0 million (c. £3.76 million) within 14 days and 180 days respectively of completion of the Merger Exercise. v 3URSRVHG'LVSRVDO 1Shop is incorporated in Malaysia and is a wholly-owned subsidiary of M1 Malaysia. In light of 1Shop’s access to M1 Malaysia’s network of licenses as well as being a non-core subsidiary, the Directors of the Group have selected 1Shop to be the joint venture vehicle with Super Apps pursuant to the Proposed Disposal and the Proposed Joint Venture. v 3URSRVHG-RLQW9HQWXUH Following completion of the Proposed Disposal, pursuant to the terms of the Proposed Joint Venture, M1 Malaysia undertakes to provide the necessary technical and business support to 1Shop. In addition, as part of the terms of the Proposed Joint Venture, M1 Malaysia guarantees that 1Shop will achieve revenues of at least RM560.0 million (equivalent to c. £104.5 million) in the financial year ending 31 December 2023 or any other period as mutually agreed (the “Revenue Target”). As the Merger Exercise has been delayed, the period to achieve the Revenue Target shall be re-assessed and agreed with Super Apps in due course. In order to achieve the Revenue Target, Super Apps undertakes to provide all the necessary working capital requirements of 1Shop. This will be supplemented through Super Apps, in conjunction with 1Shop, collaborating with other organisations. Pursuant to the terms of the Proposed Joint Venture, in consideration of M1 Malaysia’s undertakings and guarantee of achieving the Revenue Target, Super Apps shall procure TETE to issue shares in TETE (the “TETE Shares”) to a stakeholder to be mutually agreed by M1 Malaysia and Super Apps with aggregate value of RM20.0 million (equivalent to c. £3.76 million) within 14 days upon completion of the Merger Exercise. The issue price for the TETE Shares to the stakeholder will be determined at a later date. M1 Malaysia will only be entitled to receive the TETE Shares from the stakeholder following 1Shop achieving the Revenue Target. v %DFNJURXQGWR6XSHU$SSVDQGWKH3URSRVHG-RLQW9HQWXUH Super Apps is incorporated in Malaysia and is currently dormant. Super Apps has a business strategy to collaborate with companies that are involved in the e-products and services sector (together the “Business Strategy”). As a result of M1 Malaysia’s established track record in the e-products and services sector (including licence authorisations), Super Apps has identified M1 Malaysia as a joint venture partner to expand the Business Strategy in Malaysia and other countries. I 6 I v %DFNJURXQGWR7(7( TETE is listed on the Nasdaq Global Market as a special purpose acquisition company. TETE’s original intention at the time of listing was to identify and acquire companies in the technology and telecommunications sector in Malaysia (the “TETE Strategy”). As part of realising the TETE Strategy, TETE has identified Super Apps as a merger target in view of its business strategy. There can be no guarantee that the Proposed Disposal and Proposed Joint Venture can be completed as they are conditional on the completion of the Merger Exercise, which is out of the Group’s control. A proxy statement was filed by TETE on 26 June 2023 seeking to, amongst other matters, extend the deadline to complete the Merger Exercise from 20 July 2023 to 20 July 2024. An extraordinary general meeting of TETE will be held on 18 July 2023 to, inter alia, implement this extension. The completion of the Proposed Disposal and Proposed Joint Venture are expected to positively contribute to the future growth of the Group. The Company will release further announcements on the Proposed Disposal and Proposed Joint Venture at the appropriate time. Notwithstanding that the Malaysia economy is expected to grow in 2023 and many foreign workers have returned to Malaysia which can improve the demand for the Group’s mobile phone prepaid products, the Group is cautious on the outlook for 2023. This is after taking into consideration rising inflation and interest rates which could impact consumer spending as well as higher administrative expenses for the Group’s main businesses which include higher infrastructure and marketing costs as well as other related expenses. In addition, in order to maintain or grow the Group’s businesses, the Group’s gross profit margins for its products and services are likely to be impacted. For future growth, the Group will continue to invest and enhance its research and development as the backbone to support the business and technology advancement as well as to form partnerships or to undertake acquisitions in complementary businesses. ............................................ $EX%DNDUELQ0RKG7DLE Chairman Date: 30 June 2023 CHAIRMAN’S STATEMENT (CONTINUED) For the year ended 31 December 2022 I 7 I The Directors are pleased to submit their report together with the financial statements of the Company and the Group for the year ended 31 December 2022. PRINCIPAL ACTIVITY The principal activity of the Group in the year under review was mainly in the business of providing e-commerce infrastructure payment solutions and platforms. KEY PERFORMANCE INDICATORS Revenue Operating profit Profit before tax Net profit for the year KEYS RISKS AND UNCERTAINTIES 2SHUDWLRQDOULVNV The Group is not insulated from general business risk as well as certain risks inherent in the industry in which the Group operates. In particular, this includes technological changes, unfavourable changes in government and international policies (including licensing requirements), the introduction of new and superior technology or products and services by competitors and changes in the general economic, business and credit conditions. Dependency on Distributorship Agreements The Group relies on various telecommunication companies to provide the telecommunication products. As a result, the Group’s business may be materially and adversely affected if one or more of these telecommunication companies cut or reduce drastically the supply of their products. The Group has distributorship agreements with telecommunication companies such as CelcomDigi Berhad and Maxis Communication Berhad, which are subject to periodic renewal. Dependency on business partners As the revenue of the Group is substantially through the business partners’ various channels, such as banking (i.e. mobile banking and internet banking) and e-wallet applications, the Group is dependent on its business partners which include several major banks in Malaysia. The Group is exposed to the risks that any of the business partners may cease the business relationship with the Group in the future and the Group’s ability to grow may be materially and adversely affected. REPORT OF THE DIRECTORS For the year ended 31 December 2022 Interest at 31.12.22 233,761,671 416,121 278,978 16,628 Interest at 31.12.21 255,707,270 2,131,455 2,015,835 1,508,253 I 8 I KEYS RISKS AND UNCERTAINTIES (Continued) Rapid technological changes/product changes in the e-commerce industry If the Group is unable to keep pace with rapid technological development in the e-commerce industry it may adversely affect the Group’s revenues and profits. The e-commerce industry is characterised by rapid technological changes due to changing market trends, evolving industry standards, new technologies and emerging competition. Future success will be dependent upon the Group’s ability to enhance its existing technology solutions and introduce new products and services to respond to the constantly changing technological environment. The timely development of new and enhanced services or products is a complex and uncertain process. Demand of products and services The Group’s future results depend on the overall demand for its products and services. Uncertainty in the economic environment may cause some business to curtail or eliminate spending on payment technology. In addition, the Group may experience hesitancy on the part of existing and potential customers to commit to continuing with its new services. )LQDQFLDOULVNV The Group is exposed to liquidity risk and interest rate risk arise principally from its borrowings. If the Group is unable to generate sufficient cashflow from its operations, it may affect the Group’s ability to meet its financial obligations. In addition, any significant increase in interest rates may result in higher interest expense and this may affect the Group’s cashflow for its operational working capital. Please refer to Note 3 for further information. REVIEW OF BUSINESS The results for the year and financial position of the Company and the Group are as shown in the Chairman’s statement. RESULTS AND DIVIDENDS The consolidated total comprehensive profit for the year ended 31 December 2022 was £370,950 (2021: £1,463,999) which has been transferred to reserves. No dividends will be distributed for the year ended 31 December 2022. DIRECTORS The Directors are: Abu Bakar bin Mohd Taib (Non-Executive Chairman) Dato’ Hussian @ Rizal bin A. Rahman (Chief Executive Officer) Derrick Chia Kah Wai (Deputy Chief Operating Officer) Seah Boon Chin (Non-Executive Director) Azlinda Ezrina binti Ariffin (Non-Executive Director) REPORT OF THE DIRECTORS (CONTINUED) For the year ended 31 December 2022 I 9 I REPORT OF THE DIRECTORS (CONTINUED) For the year ended 31 December 2021 The beneficial interests of the Directors holding office at 31 December 2022 in the ordinary shares of the Company, were as follows: Ordinary shares of 2.5p each Abu Bakar bin Mohd Taib Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai * Seah Boon Chin * The wife of Derrick Chia Kah Wai holds 1,943,000 ordinary shares in the Company, which is equivalent to 1.83% of the Company’s issued capital. The Directors also held the following ordinary shares under options: Abu Bakar bin Mohd Taib Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai Seah Boon Chin The options were granted on 5 December 2014 at an exercise price of 2.5p. The period of the options is ten years. The Directors’ remuneration of the Group is disclosed in Note 4. SUBSTANTIAL SHAREHOLDERS Based on the register of shareholders as of 19 June 2023, the Company had the following shareholders with interests in 3% or more of the issued share capital of the Company pursuant to Part VI of Article 110 of the Companies (Jersey) Law 1991: Ordinary shares of 2.5p each Dato’ Hussian @ Rizal bin A. Rahman Estate of Dato’ Shamsir bin Omar Vidacos Nominees LimitedHSDL Nominees Limited Interactive Investor Services Nominees Limited Interest at 31.12.22 Nil 53,465,724 1,8000,000 Nil % of issued capital Nil 50.30 1.69 Nil Interest at 31.12.22 53,465,724 9,131,677 7,051,540 3,721,788 3,565,840 % of issued capital 50.30 8.59 6.63 3.50 3.35 Interest at 31.12.22 500,000 800,000 2,000,000 2,000,000 I 10 I PUBLICATION OF ACCOUNTS ON COMPANY WEBSITE Financial statements are published on the Company’s website, which can be found at www.mobilityone.com.my. The maintenance and integrity of the website is the responsibility of the Directors. The Directors’ responsibility also extends to the financial statements contained therein. INDEMNITY OF OFFICERS The Group does not have the insurance cover against legal action brought against its Directors and officers. GROUP'S POLICY ON PAYMENT OF CREDITORS It is the Group’s normal practice to make payments to suppliers in accordance with agreed terms provided that the supplier has performed in accordance with the relevant terms and conditions. EMPLOYEE INVOLVEMENT The Group places considerable value on the involvement of the employees and has continued to keep them informed on matters affecting the Group. This is achieved through formal and informal meetings. GOING CONCERN These financial statements have been prepared on the assumption that the Group is a going concern. Further information is given in Note 2 of the financial statements. SIGNIFICANT EVENTS On 19 October 2022, MobilityOne Sdn Bhd (“M1 Malaysia”) entered into a Share Sale Agreement with Super Apps Holdings Sdn Bhd (“Super Apps”) for the disposal by M1 Malaysia of a 60% shareholding in OneShop Retail Sdn Bhd (“1Shop”) to Super Apps (the “Proposed Disposal”). Concurrently, a Joint Venture cum Shareholders Agreement was entered into between M1 Malaysia, Super Apps and 1Shop (“Proposed Joint Venture”). The Proposed Disposal and Proposed Joint Venture are inter-conditional. The Proposed Disposal is subject to the completion of a merger exercise between Technology & Telecommunication Acquisition Corporation (“TETE”) and Super Apps (“Merger Exercise”). Pursuant to the terms of the Proposed Disposal and subject to the completion of the Merger Exercise, M1 Malaysia is expected to receive cash proceeds of RM40.0 million and RM20.0 million within 14 days and 180 days, respectively of completion of the Merger Exercise. In addition, as part of the terms of the Proposed Joint Venture, M1 Malaysia guarantees that 1Shop will achieve revenues of at least RM560.0 million in the financial year ending 31 December 2023 or any other period as mutually agreed (“Revenue Target”). In consideration of M1 Malaysia guaranteeing the Revenue Target, M1 Malaysia will be receiving the shares of TETE with aggregate value of RM20.0 million following 1Shop achieving the Revenue Target. A proxy statement was filed by TETE on 26 June 2023 seeking to, amongst other matters, extend the deadline to complete the Merger Exercise from 20 July 2023 to 20 July 2024. An extraordinary general meeting of TETE will be held on 18 July 2023. REPORT OF THE DIRECTORS (CONTINUED) For the year ended 31 December 2022 I 11 I REPORT OF THE DIRECTORS (CONTINUED) For the year ended 31 December 2022 STATEMENT OF DIRECTORS' RESPONSIBILITIES The Directors are responsible for preparing the Directors’ Report and financial statements in accordance with applicable law and regulations. Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards (IFRS) as adopted for use in the European Union. Under Company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the Group for that period. In preparing these financial statements, the Directors are required to: - select suitable accounting policies and then apply them consistently; - make judgments and estimates that are reasonable and prudent; - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business for the foreseeable future; and - state that the financial statements comply with International Financial Reporting Standards (IFRS) as adopted by the European Union. The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the Company and the Group and to enable them to ensure that the financial statements comply with Article 110 of the Companies (Jersey) Law 1991. They are also responsible for safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS So far as the Directors are aware, there is no relevant audit information of which the Company and Group's auditors are unaware, and each Director has taken all the steps that he ought to have taken as a Director in order to make himself aware of any relevant audit information and to establish that the Company and Group's auditors are aware of that information. AUDITORS Jeffreys Henry LLP (a member of the Gravita Group) has indicated that it will not seek re-appointment as the Company's auditor at the forthcoming Annual General Meeting as, following a business reorganisation, the group will provide audit services to clients from another company in the group, Gravita Audit Limited. A resolution to appoint Gravita Audit Limited as the Company's auditor will be proposed at the Annual General Meeting. ON BEHALF OF THE BOARD: ................................................................ Dato’ Hussian @ Rizal bin A. Rahman Chief Executive Officer Date: 30 June 2023 I 12 I $EX%DNDUELQ0RKG7DLE (Non-Executive Chairman) Abu Bakar bin Mohd Taib, a Malaysian aged 70, has been the Non-Executive Chairman of the Company since 27 June 2014 and had previously worked for several listed companies and financial institutions in Malaysia including Nestle (Malaysia) Berhad, Bank Bumiputera Malaysia Berhad (now part of CIMB Bank Berhad) and United Malayan Banking Berhad (now part of RHB Bank Berhad). He was mainly involved in corporate communications and corporate affairs until 2004. Since 2005 he has been the director of several companies that are principally involved in timber related activities in Malaysia. He obtained a Master of Business Administration in Marketing and Finance from West Coast University (USA) and a Bachelor of Science in Business Administration from California State University (USA). Dato’ Hussian @ Rizal bin A. Rahman (Chief Executive Officer) Dato’ Hussian @ Rizal bin A. Rahman, a Malaysian aged 61, is the Chief Executive Officer of the Group. He has extensive experience in the IT and telecommunications industries in Malaysia and is responsible for the development of the Group’s overall management, particularly in setting the Group’s business direction and strategies. He is currently also a Non-Executive Director of TFP Solutions Berhad, which is listed on the ACE Market of Bursa Malaysia Securities Berhad (Malaysia Stock Exchange). He obtained a certified Master of Business Administration from the Oxford Association of Management, England. 'HUULFN&KLD.DK:DL (Deputy Chief Executive Officer) Derrick Chia Kah Wai, a Malaysian aged 52, is the Deputy Chief Executive Officer of the Group. He began his career as a programmer in 1994, he then joined GHL Systems Berhad in January 1998 as a Software Engineer and was promoted to Software Development Manager in December 1999. He obtained his Bachelor Degree in Commerce, majoring in Management Information System from University of British Columbia, Canada. He joined the Group in May 2005 and is responsible for the Group’s business operations. Seah Boon Chin (Non-Executive Director) Seah Boon Chin, a Malaysian aged 51, began his career in 1995 with a financial institution in Malaysia and worked in the Corporate Finance Department of several established financial institutions in Malaysia and Singapore. He joined the Group in January 2007 and stepped down as the Corporate Finance Director on 15 November 2011 and remains as a Non-Executive Director of the Company. He is currently the Head of Corporate Finance with TA Securities Holdings Berhad in Malaysia. He obtained his Bachelor Degree in Commerce (Honours) with Distinction from McMaster University, Canada. Azlinda Ezrina binti Ariffin (Non-Executive Director) Azlinda Ezrina binti Ariffin, British by background and aged 54, is an experienced UK-based corporate lawyer with over 25 years legal experience. She is currently a consulting partner in the corporate team at Withersworldwide and was previously a partner in the capital markets teams at both Olswang LLP and Fasken Martineau LLP, prior to joining Withersworldwide in 2016. Azlinda specialises in mergers and acquisitions and equity capital markets transactions. Azlinda is a member of both the Law Society of England & Wales and the Malaysian Bar. She is also a barrister and member of Gray's Inn. BOARD OF DIRECTORS I 13 I The Directors recognise the importance of good corporate governance and have chosen to adopt the Quoted Companies Alliance Corporate Governance Code (“QCA Code”) in line with the AIM Rules requirements that all AIM quoted companies adopt and comply with a recognised corporate governance code. The Directors consider that the Company complies with the QCA Code so far as is practicable. The QCA Code identifies 10 principles that focus on the pursuit of medium to long term value for shareholders. The following report sets out in broad terms how the Company currently complies with the QCA Code. 1. Establish a strategy and business model which promote long-term value for shareholders The Group’s strategy and business model are developed by the Chief Executive Officer (“CEO”) and approved by the Board, whenever required. The management team, led by the CEO, is responsible for implementing the strategy. Over the years, the Group has developed its core competencies in providing a bridge between the service providers to their end consumers using the Group’s technology to accept transactions via multiple channels either via mobile phones, Internet, electronic data capture terminals and even via banking channels like Internet banking portal, automated teller machines (ATM) and mobile banking. Even though the e-payment business in Malaysia, particularly prepaid airtime reload and bill payment business, is contributing substantially to the Group’s revenue, the Group continues to explore other business opportunities in Malaysia and other countries to enhance its product offering for future growth. The key risks and uncertainties to the business model and strategy are detailed in the Report of the Directors of the Company’s Accounts for the year ended 31 December 2022. 2. Seek to understand and meet shareholder needs and expectations The Company encourages two-way communication with its shareholders to understand their needs and expectations. The Board recognises the annual general meeting (“AGM”) as an important opportunity to meet shareholders. The AGM is the main forum for dialogue with shareholders and all members of the Board attend the AGM and are available to answer questions raised by shareholders and to listen to views of shareholders. It should be noted that the CEO holds 50.3% of the Company’s share capital and talks to some of the Company’s non- board shareholders to understand their needs and expectations. In the future should voting decisions not be in line with the Company’s expectations, the Board would endeavour to engage with those shareholders to understand and address any issues. Contact details are provided on the contacts page of the Company’s website and within public documents should shareholders wish to communicate with the Company. CORPORATE GOVERNANCE REPORT I 14 I CORPORATE GOVERNANCE REPORT (CONTINUED) 3. Take into account wider stakeholder and social responsibilities and their implications for long-term success The Group is aware of its corporate social responsibilities and the need to maintain good relationships across a range of stakeholder groups, including employees, business partners, suppliers, customers and regulatory authorities. The Group’s operations and working environment take into account the needs of all stakeholder groups while maintaining focus on the responsibility to promote the success of the Group. The Group encourages feedback from all stakeholder groups as the Group’s long term strategy is to create shareholder value. The Group places considerable value on the involvement of employees and continues to keep them informed on matters affecting the Group through formal and informal meetings which provide opportunities to received feedback on issues affecting the Group. The Group’s activities are reliant on maintaining good relationships with a number of banking partners in Malaysia. In addition the Group’s remittance business requires certain licences from the Central Bank of Malaysia and the CEO maintains a good flow of communication with the Central Bank of Malaysia to ensure the Group’s activities continue to operate under the correct regulatory framework. 4. Embed effective risk management, considering both opportunities and threats, throughout the organisation The principal risks and uncertainties affecting the business are set in the Report of the Directors of the Company’s Accounts for the year ended 31 December 2022. The Board monitors these risks, which include technological, regulatory and commercial risks, on a regular basis and the risks are considered by the Group during Board meetings. The Executive Directors and senior management team meet regularly during the year to review and evaluate risks and opportunities. The senior management meets regularly to review ongoing trading performance and any new risks associated with ongoing trading. Risk identification can come from several sources: employees or other stakeholder feedback; executive meetings; and decisions taken at Audit Committee and Board meetings. 5. Maintain the board as a well- functioning, balanced team led by the chair The Board comprises two Executive Directors and three Non-Executive Directors. All of the Non-Executive Directors are members of the audit, remuneration and nomination committees and have the necessary skills and knowledge to discharge their duties and responsibilities. The Non-executive Chairman is responsible for the running of the Board and the CEO has main executive responsibility for running the Group’s business and implementing the Group’s strategy. Both the Chairman and Azlinda Ezrina binti Ariffin are considered by the Board to be independent. Seah Boon Chin is not deemed to be independent due to having previously been an executive board member and his length of tenure. Notwithstanding this, the Board considers that Seah Boon Chin brings an independent judgement to bear notwithstanding the aforementioned considerations. The Directors receive regular updates on the Group’s operational and financial performance during Board meetings and they have committed sufficient time to fulfill their responsibilities. I 15 I 5. Maintain the board as a well- functioning, balanced team led by the chair (continued) The Company believes it has effective procedures in place to monitor and deal with conflicts of interest. In particular the Board is aware of the other time commitments and interests of the CEO. Significant changes to these commitments and interests are reported to and, where appropriate, agreed with the rest of the Board. In addition to the numerous written Board resolutions approved by the Board which have the same force and effect as if adopted at duly convened meetings of all the Directors, the Company had five Board meetings in 2022 which were attended by all the Directors in office at the time of each board meeting. 6. Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities The Directors’ biographies are set out in the section “Board of Directors” of the Company’s Accounts for the year ended 31 December 2022. The Board is satisfied that between the Directors, they have sufficient skills, experience and capabilities to enable the strategy of the Company to be delivered. The Nomination Committee will make recommendations to the Board on all new Board appointments. Where new Board appointments are considered the search for candidates is conducted, and appointments are made, on merit, against objective criteria. The Board, if required, will review the composition of the Board to ensure that it has the necessary diversity of skills to support the ongoing development of the Group. Gender diversity is not in the Company’s immediate plans. All Directors retire by rotation at regular intervals (every 3 years) in accordance with the Company’s Articles of Association. The Directors attend courses and seminars to keep their skill set up to date. 7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvement The Directors undergo a performance evaluation before being proposed for re-election to ensure that they continue to be effective and committed to the role. All Directors meet to discuss the performance evaluation together. Appraisals are carried out each year with all Executive Directors. The Board considers that the size of the Company does not justify the use of third parties to evaluate the performance of the Board on an annual basis. All Directors retire by rotation at regular intervals (every 3 years) and stand for re-election at the AGM. During the year the Non-executive Directors are responsible for informally reviewing Directors’ performance and highlighting any issues identified. At the present time, succession planning is not in the Company’s immediate plans, however the Board will monitor the need to implement an informal or formal succession plan going forward. CORPORATE GOVERNANCE REPORT (CONTINUED) I 16 I CORPORATE GOVERNANCE REPORT (CONTINUED) 8. Promote a corporate culture that is based on ethical values and behaviours The Group maintains a high standard of integrity in the conduct of its operations and is committed to providing a safe and healthy working environment for its employees. The Group operates a corporate culture that is based on ethical values and behaviours. In addition, the Group encourages an open culture, with regular discussions with employees regarding their performance and skills development to achieve the objectives and strategy of the Group. Any recommendations from staff to improve the working environment or in respect of health and safety matters will be assessed by the Human Resources and Administration Manager and, as appropriate, proposed to the Board for necessary actions to be taken. Given the size of the Group, all practices undertaken by the Group are reviewed by the Executive Directors to ensure that the ethical values and behaviours are being adhered to. 9. Maintain governance structures and processes that are fit for purpose and support good decision- making by the board The Board has overall responsibility for promoting the success of the Group. The Executive Directors have day-to-day responsibility for the operational management of the Group’s activities. The Non-executive Directors are responsible for bringing independent and objective judgement to Board decisions. There is a clear separation of the roles of CEO and Non-executive Chairman. The Chairman is responsible for overseeing the running of the Board, ensuring that no individual or group dominates the Board’s decision-making and ensuring the Non-executive Directors are properly briefed on matters. The Chairman has overall responsibility for corporate governance matters in the Group. The CEO has the responsibility for implementing the strategy of the Board and managing the day- to-day business activities of the Group. The Board has established the following committees: Audit Committee, Remuneration Committee and Nomination Committee. The members of the three committees are all the three Non-executive Directors. Abu Bakar bin Mohd Taib chairs the Audit Committee, Remuneration Committee and Nomination Committee. The Audit Committee normally meets at least once a year and has responsibility for, amongst other things, planning and reviewing the annual report and accounts and interim statements. It is also responsible for ensuring that an effective system of internal control is maintained. The ultimate responsibility for reviewing and approving the annual financial statements and interim statements remains with the Board. The Remuneration Committee meets at least once a year and has responsibility for making recommendations to the Board on matter such as the remuneration packages for each of the Directors. The Nomination Committee, which meets as required, has responsibility for reviewing the size and composition of the Board, the appointment of replacement or additional Directors and making appropriate recommendations to the Board. The Directors consider that the Group has an appropriate governance framework for its size now and as it grows but they will consider the evolution of this framework on an annual basis. I 17 I 9. Maintain governance structures and processes that are fit for purpose and support good decision- making by the board (continued) The Board does not maintain a formal schedule of matters reserved for Board decision but matters such as financial results, Board appointments and acquisitions require approval at Company’s Board meetings or written Board resolutions approved by the Board which have the same force and effect as if adopted at duly convened meetings of all the Directors. In 2022, the Company held five Board meetings. Bard and committee meetings Attendances of Directors at Board and committee meetings convened in 2021 are set out below: Director Number of meetings in year Abu Bakar bin Mohd Taib Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai Seah Boon Chin Azlinda Ezrina Binti Ariffin 10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders. The Company encourages two-way communication with various stakeholder groups, including shareholders and responds quickly to their relevant queries. The Directors recognise the AGM as an important opportunity to meet shareholders and the Directors are available to answer questions raised by the shareholders. The Company’s website is regularly updated to include business progress, financial performance and corporate actions reflecting information that has already been announced by the Company through regulatory announcements. The Company will announce and post on its website the results of voting on all resolutions in the general meetings (including annual general meetings) including any actions to be taken as a result of resolutions for which votes against have been received from at least 20 per cent. of independent shareholders. Under AIM Rule 26, the Company already publishes historical annual reports, notices of meetings and other publications over the last five years which can be found here: http://www.mobilityone.com.my/v4/annual-reports.html The Company has not published an audit committee or remuneration committee report in its annual report and accounts. The Board feels that this is appropriate given the size and stage of development of the Group. The Board will consider annually whether it considers it appropriate for these reports to be included in future annual report and accounts. CORPORATE GOVERNANCE REPORT (CONTINUED) Board Meetings Attended 5 5 5 5 5 5 Audit Committee Meeting Attended 2 2 N/A N/A 2 2 Remuneration Committee Meeting Attended 1 1 N/A N/A 1 1 I 18 I OPINION We have audited the financial statements of MobilityOne Limited (the ‘parent company’) and its subsidiaries (the ‘Group’), which comprise the consolidated statement of financial position as at 31 December 2022 and the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the year then ended and notes to the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in the preparation of the Group financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. The financial reporting framework that has been applied in the preparation of the parent company financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union. In our opinion: v WKHoQDQFLDOVWDWHPHQWVJLYHDWUXHDQGIDLUYLHZRIWKHVWDWHRIWKH*URXS VDQGRIWKHSDUHQWFRPSDQ\ VDIIDLUVDVDW 31 December 2022 and of the Group’s loss for the year then ended; v WKH*URXS VoQDQFLDOVWDWHPHQWVKDYHEHHQSURSHUO\SUHSDUHGLQDFFRUGDQFHZLWK,QWHUQDWLRQDO)LQDQFLDO5HSRUWLQJ6WDQGDUG (IFRSs) as adopted by the European Union; v WKHSDUHQWFRPSDQ\ VoQDQFLDOVWDWHPHQWVKDYHEHHQSURSHUO\SUHSDUHGLQDFFRUGDQFHZLWK,)56VDVDGRSWHGE\WKH European Union and as applied in accordance with the requirements and provisions of Companies (Jersey) Law 1991; and v WKHoQDQFLDOVWDWHPHQWVKDYHEHHQSUHSDUHGLQDFFRUGDQFHZLWKWKHUHTXLUHPHQWVRIWKH&RPSDQLHV -HUVH\ /DZ BASIS FOR OPINION We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) and ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. CONCLUSIONS RELATING TO GOING CONCERN In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial statement is appropriate. Our evaluation of the Directors’ assessment of the entity’s ability to continue to adopt the going concern basis of accounting included, as part of our risk assessment, review of the nature of the business of the Company, its business model and related risks including where relevant the impact of the COVID-19 pandemic and Brexit, the requirements of the applicable financial reporting framework and the system of internal control. We evaluated the Directors’ assessment of the Company’s ability to continue as a going concern, including challenging the underlying data and key assumptions used to make the assessment, and evaluated the directors’ plans for future actions in relation to their going concern assessment. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on MobilityOne Limited (the ‘parent company’) and its subsidiaries (the ‘Group’) ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. However, because not all future events or conditions can be predicted this statement is not a guarantee as to the Company’s ability to continue as a going concern. Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report. REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED I 19 I KEY AUDIT MATTERS Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. This is not a complete list of all risks identified by our audit REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED (CONTINUED) How our audit addressed the key audit matter We reviewed the net assets of the subsidiary companies in comparison to the net book value of investments. We considered the nature of MobilityOne Limited as a holding company, whilst the subsidiary companies make up the trading element of the Group. In light of this we also compared the net book value of investments with the market capitalisation of the Group. We reviewed the carrying value of the inventory against the Net Realisable Value (NRV) of the inventory in ensuring that the carrying value are not higher than that of NRV. Key audit matter Investment in subsidiaries MobilityOne Limited has significant interest in subsidiary companies. As such there is a risk that the net book value of investments may be impaired. Inventory The subsidiary of the Group, MobilityOne Sdn Bhd, holds material levels of inventory at the year end which presents a risk that the carrying values might be overstated and impact the Group figures. I 20 I OUR APPLICATION OF MATERIALITY The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole. Based on our professional judgment, we determined materiality for the financial statements as a whole as follows: For each component in the scope of our Group audit, we allocated a materiality that is less than our overall Group materiality. The range of materiality allocated across components was between £130,000 and £5,000. We agreed with the Audit Committee that we would report to them misstatements identified during our audit above £10,000 (2021: £15,050) as well as misstatements below those amounts that, in our view, warranted reporting for qualitative reasons. AN OVERVIEW OF THE SCOPE OF OUR AUDIT As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements. In particular, we looked at where the directors made subjective judgments, for example in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits we also addressed the risk of management override of internal controls, including evaluating whether there was evidence of bias by the directors that represented a risk of material misstatement due to fraud. How we tailored the audit scope We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the financial statements as a whole, taking into account the structure of the Group and the Company, the accounting processes and controls, and the industry in which they operate. The Group’s financial statements are a consolidation of ten reporting units, comprising the Group’s operating businesses and holding companies. REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED (CONTINUED) Overall materiality How we determined it Rationale for benchmark applied Group financial statements £191,000 (2021: £205,000). 1.5% of gross profit We believe that gross profit, gross assets and net assets are the primary measures used by the shareholders in assessing the performance of the Group and is a generally accepted auditing benchmark. Company financial statements £9,000 (2021: £7,000). 5% of profit before tax We believe that profit before tax and gross assets are the primary measure used by the shareholders in assessing the performance of the Company, and is a generally accepted auditing benchmark I 21 I REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED (CONTINUED) AN OVERVIEW OF THE SCOPE OF OUR AUDIT (Continued) We performed audits of the complete financial information of MobilityOne Limited, MobilityOne Sdn Bhd, M1 Pay Sdn Bhd, One Tranzact Sdn Bhd, OneShop Retail Sdn Bhd, M1 Merchant Sdn Bhd, M-One Tech Limited and M1 AP Sdn Bhd reporting units, which were individually financially significant and accounted for 100% of the Group’s revenue and 95% of the Group’s absolute profit before tax (i.e. the sum of the numerical values without regard to whether they were profits or losses for the relevant reporting units). The Group’s engagement team performed all audit procedures, with the exception of the audit of MobilityOne Sdn Bhd, M1 Pay Sdn Bhd, One Tranzact Sdn Bhd, OneShop Retail Sdn Bhd, M1 Merchant Sdn Bhd and M1 AP Sdn Bhd which were performed by a component auditor in Malaysia. Our involvement in the work of the component auditor in Malaysia included regular communication with a formal meeting arranged following the performance of the procedures. A review of the working papers was undertaken in the United Kingdom and we visited the offices of both the Malaysian component auditor and client. OTHER INFORMATION The other information comprises the information included in the annual report, other than the financial statements and our auditor’s report thereon. The Directors are responsible for the other information contained within the annual report. Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION BY THE COMPANIES (JERSEY) LAW 1991 In the light of the knowledge and understanding of the Group and parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the directors’ report. We have nothing to report in respect of the following matters in relation to which the Companies (Jersey) Law 1991 Article 113B (3) requires us to report to you if, in our opinion: v SURSHUDFFRXQWLQJUHFRUGVKDYHQRWEHHQNHSWE\WKHSDUHQWFRPSDQ\RUUHWXUQVDGHTXDWHIRURXUDXGLWKDYHQRWEHHQ received from branches not visited by us; or v ZHKDYHQRWUHFHLYHGDOOWKHLQIRUPDWLRQDQGH[SODQDWLRQVZHUHTXLUHIRURXUDXGLW RU v WKHJURXSDQGSDUHQWFRPSDQ\oQDQFLDOVWDWHPHQWVDUHQRWLQDJUHHPHQWZLWKWKHDFFRXQWLQJUHFRUGVDQGUHWXUQV I 22 I RESPONSIBILITIES OF MANAGEMENT AND THOSE CHARGED WITH GOVERNANCE FOR THE CONSOLIDATED FINANCIAL STATEMENT As explained more fully in the directors’ responsibilities statement set out on page 9, the Directors and management are responsible for the preparation and fair presentation of the consolidated of the financial statements in accordance with IFRS, and for such internal control as the directors and management determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the Directors and management are responsible for assessing the Group’s and parent company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors and management either intend to liquidate the Group or the parent company or to cease operations, or have no realistic alternative but to do so. Those charged with governance are responsible for overseeing the Group’s financial reporting process. AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTS Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. THE EXTENT TO WHICH THE AUDIT WAS CONSIDERED CAPABLE OF DETECTING IRREGULARITIES INCLUDING FRAUD Our approach to identifying and assessing the risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and regulations, was as follows: v WKHVHQLRUVWDWXWRU\DXGLWRUHQVXUHGWKHHQJDJHPHQWWHDPFROOHFWLYHO\KDGWKHDSSURSULDWHFRPSHWHQFHFDSDELOLWLHVDQG skills to identify or recognise non-compliance with applicable laws and regulations. v ZHLGHQWLoHGWKHODZVDQGUHJXODWLRQVDSSOLFDEOHWRWKHJURXSWKURXJKGLVFXVVLRQVZLWKGLUHFWRUVDQGRWKHUPDQDJHPHQW v ZHIRFXVHGRQVSHFLoFODZVDQGUHJXODWLRQVZKLFKZHFRQVLGHUHGPD\KDYHDGLUHFWPDWHULDOHIIHFWRQWKHoQDQFLDOVWDWHPHQWV or the operations of the company, including taxation legislation, data protection, anti-bribery, employment, environmental, health and safety legislation and anti-money laundering regulations. v ZHDVVHVVHGWKHH[WHQWRIFRPSOLDQFHZLWKWKHODZVDQGUHJXODWLRQVLGHQWLoHGDERYHWKURXJKPDNLQJHQTXLULHVRIPDQDJHPHQW and inspecting legal correspondence. v LGHQWLoHGODZVDQGUHJXODWLRQVZHUHFRPPXQLFDWHGZLWKLQWKHDXGLWWHDPUHJXODUO\DQGWKHWHDPUHPDLQHGDOHUWWRLQVWDQFHV of non-compliance throughout the audit; and v ZHDVVHVVHGWKHVXVFHSWLELOLW\RIWKHJURXS VoQDQFLDOVWDWHPHQWVWRPDWHULDOPLVVWDWHPHQWLQFOXGLQJREWDLQLQJDQ understanding of how fraud might occur, by: o making enquiries of management as to where they considered there was susceptibility to fraud, their knowledge of actual, suspected and alleged fraud; and o considering the internal controls in place to mitigate risks of fraud and non-compliance with laws and regulations. REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED (CONTINUED) I 23 I REPORT OF THE INDEPENDENT AUDITORS TO THE MEMBERS OF MOBILITYONE LIMITED (CONTINUED) TO ADDRESS THE RISK OF FRAUD THROUGH MANAGEMENT BIAS AND OVERRIDE OF CONTROLS, WE: v SHUIRUPHGDQDO\WLFDOSURFHGXUHVWRLGHQWLI\DQ\XQXVXDORUXQH[SHFWHGUHODWLRQVKLSV v WHVWHGMRXUQDOHQWULHVWRLGHQWLI\XQXVXDOWUDQVDFWLRQV v DVVHVVHGZKHWKHUMXGJHPHQWVDQGDVVXPSWLRQVPDGHLQGHWHUPLQLQJWKHDFFRXQWLQJHVWLPDWHVVHWRXWLQQRWHRIWKH Group financial statements were indicative of potential bias; v LQYHVWLJDWHGWKHUDWLRQDOHEHKLQGVLJQLoFDQWRUXQXVXDOWUDQVDFWLRQV DQG v LQUHVSRQVHWRWKHULVNRILUUHJXODULWLHVDQGQRQFRPSOLDQFHZLWKODZVDQGUHJXODWLRQVZHGHVLJQHGSURFHGXUHVZKLFK included, but were not limited to: o agreeing financial statement disclosures to underlying supporting documentation; o reading the minutes of meetings of those charged with governance; o enquiring of management as to actual and potential litigation and claims; and o reviewing correspondence with local tax authority and the group’s legal advisors. There are inherent limitations in our audit procedures described above. The more removed laws and regulations are from financial transactions, the less likely it is that we would become aware of noncompliance. Auditing standards also limit the audit procedures required to identify non-compliance with laws and regulations to enquiry of the directors and other management and the inspection of regulatory and legal correspondence, if any. Material misstatements that arise due to fraud can be harder to detect than those that arise from error as they may involve deliberate concealment or collusion. A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s website at: KWWS ZZZIUFRUJXNDXGLWRUVUHVSRQVLELOLWLHV. This description forms part of our auditor’s report. USE OF THIS REPORT This report is made solely to the company’s members, as a body, in accordance with Article 113A of the Companies (Jersey) Law 1991. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed. Sudhir Rawal For and on behalf of Jeffreys Henry LLP, Statutory Auditor Finsgate 5-7 Cranwood Street London EC1V 9EE United Kingdom Date: 30 June 2023 I 24 I CONSOLIDATED INCOME STATEMENT For the year ended 31 December 2022 Revenue Cost of sales GROSS PROFIT Other operating income Administration expenses Other operating expenses Net loss on financial instruments Share of associate result OPERATING PROFIT Finance costs PROFIT BEFORE TAX Tax PROFIT FROM CONTINUING OPERATIONS PROFIT Attributable to: Owners of the parent Non-controlling interests PROFIT PER SHARE Basic earnings per share (pence) Diluted earnings per share (pence) PROFIT PER SHARE FROM CONTINUING OPERATIONS Basic earnings per share (pence) Diluted earnings per share (pence) 2021 £ 255,707,270 (242,050,541) 13,656,729 155,832 (11,256,000) (411,740) (13,366) - 2,131,455 (115,620) 2,015,835 (507,582) 1,508,253 1,508,253 1,524,429 (16,176) 1,508,253 1.434 1.341 1.434 1.341 2022 £ 233,761,671 (221,010,827) 12,750,844 183,426 (11,940,311) (304,196) (273,642) - 416,121 (137,143) 278,978 (262,350) 16,628 16,628 23,857 (7,229) 16,628 0.022 0.021 0.022 0.021 Note 5 16 6 7 8 10 10 10 10 The notes form part of these financial statements I 25 I CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME For the year ended 31 December 2022 PROFIT FOR THE YEAR OTHER COMPREHENSIVE PROFIT Items that are or may be reclassified subsequently to profit or loss Foreign currency translation TOTAL COMPREHENSIVE PROFIT Total comprehensive profit attributable to: Owners of the parent Non-controlling interests 2021 £ 1,508,253 (44,254) 1,463,999 1,458,754 5,245 1,463,999 2022 £ 16,628 354,322 370,950 378,832 (7,882) 370,950 The notes form part of these financial statements I 26 I The notes form part of these financial statements CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the year ended 31 December 2022 As at 1 January 2022 Comprehensive profit Profit for the year Foreign currency translation Total comprehensive profit for the year At 31 December 2022 Share Premium £ 909,472 - - - 909,472 Total £ 4,850,977 23,857 354,975 378,832 5,229,809 Total Equity £ 4,843,748 16,628 354,322 370,950 5,214,698 Foreign Currency Translation Reserve £ 692,707 - 354,975 354,975 1,047,682 Share Capital £ 2,657,470 - - - 2,657,470 Accum. Losses £ (117,623) 23,857 - 23,857 (93,766) Non- Controlling Interests £ (7,229) (7,229) (653) (7,882) (15,111) Reverse Acquisition Reserve £ 708,951 - - - 708,951 Non-Distributable Distributable Attributable to Owners of the Parent I 27 I The notes form part of these financial statements CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (CONTINUED) For the year ended 31 December 2022 At 1 January 2021 Comprehensive profit Profit for the year Foreign currency translation Total comprehensive profit for the year At 31 December 2021 Share Premium £ 909,472 - - - 909,472 Total £ 3,392,223 1,524,429 (65,675) 1,458,754 4,850,977 Total Equity £ 3,379,749 1,508,253 (44,254) 1,463,999 4,843,748 Foreign Currency Translation Reserve £ 758,382 - (65,675) (65,675) 692,707 Share Capital £ 2,657,470 - - - 2,657,470 Accum. Losses £ (1,642,052) 1,524,429 - 1,524,429 (117,623) Non- Controlling Interests £ (12,474) (16,176) 21,421 5,245 (7,229) Reverse Acquisition Reserve £ 708,951 - - - 708,951 Non-Distributable Distributable Share capital is the amount subscribed for shares at nominal value. Share premium represents the excess of the amount subscribed for share capital over the nominal value of the respective shares net of share issue expenses. The reverse acquisition reserve relates to the adjustment required by accounting for the reverse acquisition in accordance with IFRS 3. The Company’s assets and liabilities stated in the Statement of Financial Position were translated into Pound Sterling (£) using the closing rate as at the Statement of Financial Position date and the Income Statements were translated into £ using the average rate for that period. All resulting exchange differences are taken to the foreign currency translation reserve within equity. Retained earnings represent the cumulative earnings of the Group attributable to equity shareholders. Non-controlling interests represent the share of ownership of subsidiary companies outside the Group. Attributable to Owners of the Parent I 28 I The notes form part of these financial statements COMPANY STATEMENT OF CHANGES IN EQUITY For the year ended 31 December 2022 As at 1 January 2022 Loss for the year At 31 December 2022 As at 1 January 2021 Loss for the year At 31 December 2021 Total £ 1,533,822 (178,125) 1,355,697 1,681,094 (147,272) 1,533,822 Share Premium £ 909,472 - 909,472 909,472 - 909,472 Accumulated Losses £ (2,033,120) (178,125) (2,211,245) (1,885,848) (147,272) (2,033,120) Share Capital £ 2,657,470 - 2,657,470 2,657,470 - 2,657,470 Non-Distributable I 29 I The notes form part of these financial statements CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 31 December 2022 ASSETS Non-current assets Intangible assets Property, plant and equipment Right-of-use assets Trade and other receivables Other investment Current assets Inventories Trade and other receivables Tax recoverable Cash and cash equivalents TOTAL ASSETS SHAREHOLDERS’ EQUITY Equity attributable to owners of the parent: Called up share capital Share premium Reverse acquisition reserve Foreign currency translation reserve Accumulated losses Shareholders’ equity Non-controlling interests TOTAL EQUITY 2021 £ 433,844 950,664 155,660 - - 1,540,168 3,118,571 3,177,698 53,010 4,665,524 11,014,803 12,554,971 2,657,470 909,472 708,951 692,707 (117,623) 4,850,977 (7,229) 4,843,748 2022 £ 214,180 1,122,194 182,935 228,050 12,281 1,759,640 3,189,901 2,179,785 183,321 5,015,172 10,568,179 12,327,819 2,657,470 909,472 708,951 1,047,682 (93,766) 5,229,809 (15,111) 5,214,698 Note 11 12 14 17 15 17 18 19 20 21 22 23 I 30 I The notes form part of these financial statements CONSOLIDATED STATEMENT OF FINANCIAL POSITION (CONTINUED) As at 31 December 2022 LIABILITIES Non-current liability Loans and borrowings – secured Lease liabilities Deferred tax liabilities Current liabilities Trade and other payables Amount due to Directors Loans and borrowings – secured Lease liabilities Tax payables Total liabilities TOTAL EQUITY AND LIABILITIES 2021 £ 217,881 83,501 42,570 343,952 5,203,551 124,426 1,958,841 71,988 8,465 7,367,271 7,711,223 12,554,971 2022 £ 221,697 98,450 15,484 335,631 2,947,056 66,855 3,647,482 105,316 10,781 6,777,490 7,113,121 12,327,819 Note 24 14 25 26 24 14 The financial statements were approved and authorised by the Board of Directors on 30 June 2023 and were signed on its behalf by: ........................................................................... Dato’ Hussian @ Rizal bin A. Rahman Chief Executive Officer I 31 I The notes form part of these financial statements 2021 £ 1,976,339 - 1,976,339 18 36,638 11,248 47,904 2,024,243 2,657,470 909,472 (2,033,120) 1,533,822 901 367,605 121,915 490,421 2,024,243 COMPANY STATEMENT OF FINANCIAL POSITION As at 31 December 2022 ASSETS Non-current asset Investment in subsidiary companies Investment in associate company Current assets Trade and other receivables Amount owing from subsidiary companies Cash and cash equivalents TOTAL ASSETS SHAREHOLDERS’ EQUITY Equity attributable to owners of the parent: Called up share capital Share premium Accumulated losses TOTAL EQUITY Current liabilities Trade and other payables Amount due to subsidiary companies Amount due to Directors TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES 2022 £ 1,976,339 - 1,976,339 - 55,638 11,264 66,902 2,043,241 2,657,470 909,472 (2,211,245) 1,355,697 10,658 612,703 64,183 687,544 2,043,241 Note 13 16 17 18 19 20 23 25 26 The financial statements were approved and authorised by the Board of Directors on 30 June 2023 and were signed on its behalf by: ........................................................................... Dato’ Hussian @ Rizal bin A. Rahman Chief Executive Officer I 32 I The notes form part of these financial statements CONSOLIDATED STATEMENT OF CASH FLOWS For the year ended 31 December 2022 Cash flow from operating activities Cash flow from operations Interest received Tax paid Tax refund Net cash (used in)/generated from operating activities Cash flow from investing activities Purchase of property, plant and equipment Addition in right-of-use assets Addition in other investment Net cash outflow for acquisition of subsidiary company Proceeds from disposal of property, plant and equipment Repayment from associate company Addition in non-controlling interests Net cash used in investing activities Cash flows from financing activities Interest paid Net change of banker acceptance Repayment of lease liabilities Repayment of term loan Net cash from/(used in) financing activities (Derease)/Increase in cash and cash equivalents Effect of foreign exchange rate changes Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year 2021 £ 2,409,305 12,867 (723,469) - 1,698,703 (34,866) (5,690) - (376,517) - 221,583 21,310 (174,180) (115,620) (1,202,597) (122,576) (8,734) (1,449,527) 74,996 172,652 4,417,876 4,665,524 2022 £ (614,763) 35,933 (421,991) 5,532 (995,289) (390,056) - (12,281) - 8,465 - - (393,872) (137,143) 1,562,937 (111,144) (9,615) 1,305,035 (84,126) 433,774 4,665,524 5,015,172 Note 27 12 13 24 14 18 I 33 I The notes form part of these financial statements COMPANY STATEMENT OF CASH FLOWS For the year ended 31 December 2022 Cash flow from operating activities Cash depleted in operations Cash flow from investing activities Advances to a subsidiary company, representing net cash from investing activities Cash flow from financing activity Advances from a subsidiary company, representing net cash from financing activity Increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year 2021 £ (135,772) (36,637) (36,637) 172,518 109 11,139 11,248 2022 £ 16 - - - 16 11,248 11,264 Note 27 18 I 34 I 1. GENERAL INFORMATION The principal activity of the Company is investment holding. The principal activities of the subsidiary companies are set out in Note 13 to the financial statements. There were no significant changes in the nature of these activities during the year. The Company is incorporated in Jersey, the Channel Islands under the Companies (Jersey) Law 1991 and is listed on AIM. The registered office is located at 13 Castle Street, St Helier, Jersey JE1 1ES, Channel Islands. The consolidated financial statements for the year ended 31 December 2022 comprise the results of the Company and its subsidiary companies undertakings. The Company’s shares are traded on AIM of the London Stock Exchange. MobilityOne Limited is the holding company of an established group of companies (“Group”) based in Malaysia which is in the business of providing e-commerce infrastructure payment solutions and platforms through their proprietary technology solutions, which are marketed under the brands MoCS and ABOSSE. The Group has developed an end-to-end e-commerce solution which connects various service providers across several industries such as banking, telecommunication and transportation through multiple distribution devices such as EDC terminals, short messaging services, Automated Teller Machine and Internet banking. The Group’s technology platform is flexible, scalable and has been designed to facilitate cash, debit card and credit card transactions (according to the device) from multiple devices while controlling and monitoring the distribution of different products and services. 2. ACCOUNTING POLICIES Basis of preparation These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs and IFRIC interpretations) issued by the International Accounting Standards Board (IASB), as adopted by the European Union, and with those parts of the Companies (Jersey) Law 1991 applicable to companies preparing their financial statements under IFRS. The financial statements have been prepared under the historical cost convention. Going Concern The Group’s business activities, together with the factors likely to affect its future development, performance and position, are set out in Chairman’s statement on page 2. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the financial statements and associated notes. In addition, Note 3 to the financial statements includes the Group’s objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk. In order to assess the going concern of the Group, the Directors have prepared cashflow forecasts for companies within the Group. These cashflow forecasts show the Group expect an increase in revenue and will have sufficient headroom over available banking facilities. The Group has obtained banking facilities sufficient to facilitate the growth forecast in future periods. No matters have been drawn to the Directors’ attention to suggest that future renewals may not be forthcoming on acceptable terms. In addition, the controlling shareholder has also undertaken to provide support to enable the Group to meet its debts as and when they fall due. NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2022 I 35 I NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2022 2. ACCOUNTING POLICIES (Continued) Going Concern (continued) After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the financial statements. The financial statements do not include any adjustments that would result if the forecast were not achieved and shareholder support was withdrawn. Estimation uncertainty and critical judgements The significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amount amortisation in the financial statements are as follows: (i) Depreciation of property, plant and equipment The costs of property, plant and equipment of the Group are depreciated on a straight-line basis over the useful lives of the assets. Management estimates the useful lives of the property, plant and equipment to be within 3 to 50 years. These are common life expectancies applied in the industry. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised. The carrying amounts of the Group’s property, plant and equipment as at 31 December 2022 are disclosed in Note 12 to the financial statements. (ii) Amortisation of intangible assets Software is amortised over its estimated useful life. Management estimated the useful life of this asset to be within 10 years. Changes in the expected level of usage and technological development could impact the economic useful life therefore future amortisation could be revised. The research and development costs are amortised on a straight-line basis over the life span of the developed assets. Management estimated the useful life of these assets to be within 5 years. Changes in the technological developments could impact the economic useful life and the residual values of these assets, therefore future amortisation charges could be revised. The carrying amounts of the Group’s intangible assets as at 31 December 2022 are disclosed in Note 11 to the financial statements. However, if the projected sales do not materialise there is a risk that the value of the intangible assets shown above would be impaired. I 36 I NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 2. ACCOUNTING POLICIES (Continued) Estimation uncertainty and critical judgements (continued) (iii) Impairment of goodwill on consolidation The Group determines whether goodwill is impaired at least on an annual basis. This requires an estimation of the value-in-use of the cash generating units (“CGU”) to which goodwill is allocated. Estimating a value-in-use amount requires management to make an estimation of the expected future cash flows from the CGU and also to choose a suitable discount rate in order to calculate the present value of those cash flows. The Group’s cash flow projections include estimates of sales. However, if the projected sales do not materialise there is a risk that the value of goodwill would be impaired. The Directors have carried out a detailed impairment review in respect of goodwill. The Group assesses at each reporting date whether there is an indication that an asset may be impaired, by considering the cash flows forecasts. The cash flow projections are based on the assumption that the Group can realise projected sales. A prudent approach has been applied with no residual value being factored. At the period end, based on these assumptions, there was indication of impairment of the value of goodwill and of development costs. The carrying amount of the Group’s goodwill on consolidation as at 31 December 2022 is disclosed in the Note 11 to the financial statements. (iv) Going concern The Group determines whether it has sufficient resources in order to continue its activities by reference to budget together with current and forecast liquidity. This requires an estimate of the availability of such funding which is critically dependent on external borrowings support from the majority shareholders of the Group and, to an extent, macroeconomic factors. (v) Inventories valuation Inventories are measured at the lower of cost and net realisable value. The Company estimates the net realisable value of inventories based on an assessment of expected sales prices. Demand levels and pricing competition could change from time to time. If such factors result in an adverse effect on the Group’s products, the Group might be required to reduce the value of its inventories. Details of inventories are disclosed in Note 15 to the financial statements. (vi) Income taxes Judgement is involved in determining the provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. As at 31 December 2022, the Group has tax recoverable of £183,321 (2021: £53,010). I 37 I NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 2. ACCOUNTING POLICIES (Continued) IFRS AND IAS UPDATE FOR 31 DECEMBER 2021 ACCOUNTS Standards, interpretations and amendments to published standards that are not yet effective The following standards, amendments and interpretations applicable to the Group are in issue but are not yet effective and have not been early adopted in these financial statements. They may result in consequential changes to the accounting policies and other note disclosures. We do not expect the impact of such changes on the financial statements to be material. These are outlined in the table below: IFRS 17 Insurance Contracts Amendments to IFRS 17 Insurance Contracts Amendments to IFRS 17 Initial application of IFRS 17 and IFRS 9 – Comparative Information Amendments to IAS 1 Disclosure of Accounting Policies Amendments to IAS 8 Definition of Accounting Estimates Amendments to IAS 12 Deferred Tax related to Assets and Liabilities arising from a Single Transaction Amendments to IAS 1 Classification of Liabilities as Current or Non-current Amendments to IFRS 16 Lease Liability in a Sale and Leaseback Amendments to IAS 1 Non-current Liabilities with Covenants Amendments to IFRS 10 Sale or Contribution of Assets between an Investor and and IAS 28 its Associate or Joint Venture The Directors anticipate that the adoption of these standards and the interpretations in future periods will have no material impact on the financial statements of the Group. Basis of consolidation The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiary companies) made up to 31 December each year. Control is achieved where the Company has the power to govern the financial and operating policies of an investee entity so as to obtain benefits from its activities. Transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of its subsidiary companies have been changed (where necessary) to ensure consistency with the policies adopted by the Group. Effective dates for financial periods beginning on or after 1 January 2023 1 January 2023 1 January 2023 1 January 2023 1 January 2023 1 January 2024 1 January 2024 1 January 2024 1 January 2024 Deferred until further notice I 38 I 2. ACCOUNTING POLICIES (Continued) Basis of consolidation (Continued) (i) Subsidiary companies Subsidiary companies are entities over which the Group has the ability to control the financial and operating policies so as to obtain benefits from their activities. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group has such power over another entity. In the Company’s separate financial statements, investments in subsidiary companies are stated at cost less impairment losses. On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss. (ii) Basis of consolidation On 22 June 2007 MobilityOne Limited acquired the entire issued share capital of MobilityOne Sdn. Bhd. By way of a share for share exchange, under IFRS this transaction meets the criteria of a Reverse Acquisition. The consolidated accounts have therefore been presented under the Reverse Acquisition Accounting principles of IFRS 3 and show comparatives for MobilityOne Sdn. Bhd. For financial reporting purposes, MobilityOne Sdn. Bhd. (the legal subsidiary company) is the acquirer and MobilityOne Limited (the legal parent company) is the acquiree. No goodwill has been recorded and the difference between the parent Company’s cost of investment and MobilityOne Sdn. Bhd.’s share capital and share premium is presented as a reverse acquisition reserve within equity on consolidation. The consolidated financial statements incorporate the financial statements of the Company and all entities controlled by it after eliminating internal transactions. Control is achieved where the Group has the power to govern the financial and operating policies of a Group undertaking so as to obtain economic benefits from its activities. Undertakings’ results are adjusted, where appropriate, to conform to Group accounting policies. Subsidiary companies are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases. In preparing the consolidated financial statements, intra-group balances, transactions and unrealised gains or losses are eliminated in full. Uniform accounting policies are adopted in the consolidated financial statements for like transactions and events in similar circumstances. The share capital in the consolidated statement of changes in equity for both the current and comparative period uses a historic exchange rate to determine the equity value. As permitted by and in accordance with Article 105 of the Companies (Jersey) Law 1991, a separate income statement of MobilityOne Limited, is not presented. Revenue recognition Revenue is recognised when it is probable that economic benefits associated with the transaction will flow to the Group and the amount of the revenue can be measured reliably. (i) Revenue from trading activities Revenue in respect of using the Group’s e-Channel platform arises from the sales of prepaid credit, sales commissions received and fees per transaction charged to customers. Revenue for sales of prepaid credit is deferred until such time as the products and services are delivered to end users. Sales commissions and transaction fees are received from various product and services providers and are recognised when the services are rendered and transactions are completed. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 39 I 2. ACCOUNTING POLICIES (Continued) Revenue recognition (Continued) (i) Revenue from trading activities (Continued) Revenue from solution sales and consultancy comprise sales of software solutions, hardware equipment, consultancy fees and maintenance and support services. For sales of hardware equipment, revenue is recognised when the significant risks associated with the equipment are transferred to customers or the expiry of the right of return. For all other related sales, revenue is recognised upon delivery to customers and over the period in which services are expected to be provided to customers. Revenue from remittance comprises transaction service fees charged to customers/senders. Transaction fees are received from senders and are recognised when the services are rendered and transactions are completed. More than 95% of the Group’s revenue for the financial ended 31 December 2022 was generated in Malaysia and none of the revenue was derived in the United Kingdom. (ii) Interest income Interest income is recognised on a time proportion basis that takes into account the effective yield on the asset. (iii) Rental income Rental income is recognised on an accrual basis. Employee benefits (i) Short term employee benefits Wages, salaries, bonuses and social security contributions are recognised as an expense in the period in which the associated services are rendered by employees of the Group. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensation absences. Short term non-accumulating compensated absences such as sick and medical leave are recognised when the absences occur. The expected cost of accumulating compensated absences is measured as the additional amount expected to be paid as a result of the unused entitlement that has accumulated at the Statement of Financial Position date. (ii) Defined contribution plans As required by law, companies in Malaysia make contributions to the state pension scheme, the Employees Provident Fund (“EPF”). Such contributions are recognised as an expense in the income statement in the period to which they relate. The other subsidiary companies also make contribution to their respective countries’ statutory pension schemes. Functional currency translation (i) Functional and presentation currency Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The functional currency of the Group is Ringgit Malaysia (RM). The consolidated financial statements are presented in Pound Sterling (£), which is the Company’s presentational currency as this is the currency used in the country in which the entity is listed. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 40 I 2. ACCOUNTING POLICIES (Continued) Functional currency translation (Continued) (i) Functional and presentation currency (Continued) Assets and liabilities are translated into Pound Sterling (£) at foreign exchange rates ruling at the Statement of Financial Position date. Results and cash flows are translated into Pound Sterling (£) using average rates of exchange for the period. (ii) Transactions and balances Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. The financial information set out below has been translated at the following rates: Year ended 31 December 2022 Year ended 31 December 2021 Taxation Taxation on the income statement for the financial period comprises current and deferred tax. Current tax is the expected amount of taxes payable in respect of the taxable profit for the financial period and is measured using the tax rates that have been enacted at the Statement of Financial Position date. Deferred tax is recognised on the liability method for all temporary differences between the carrying amount of an asset or liability in the Statement of Financial Position and its tax base at the Statement of Financial Position date. Deferred tax liabilities are recognised for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that future taxable profit will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be recognised. Deferred tax is not recognised if the temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is recognised or the liability is settled, based on the tax rates that have been enacted or substantively enacted by the Statement of Financial Position date. The carrying amount of a deferred tax asset is reviewed at each Statement of Financial Position date and is reduced to the extent that it becomes probable that sufficient future taxable profit will be available. Deferred tax is recognised in the income statement, except when it arises from a transaction which is recognised directly in equity, in which case the deferred tax is also charged or credited directly in equity, or when it arises from a business combination that is an acquisition, in which case the deferred tax is included in the resulting goodwill or negative goodwill. Exchange rate (RM: £) Average for year 5.43 5.70 At Statement of Financial Position date 5.29 5.63 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 41 I 2. ACCOUNTING POLICIES (Continued) Intangible assets (i) Research and development costs All research costs are recognized in the income statement as incurred. Expenditure incurred on projects to develop new products is recognised and deferred 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 project and the ability to measure reliably the expenditure during the development. Product development expenditures which do not meet these criteria are expensed when incurred. Development costs, considered to have finite useful lives, are stated at cost less any impairment losses and are amortised through other operating expenses in the income statement using the straight-line basis over the commercial lives of the underlying products not exceeding five years. Impairment is assessed whenever there is an indication of impairment and the amortisation period and method are also reviewed at least at each Statement of Financial Position date. (ii) Goodwill on consolidation Goodwill acquired in a business combination is initially measured at cost, representing the excess of the purchase price over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities. Following the initial recognition, goodwill is measured at cost less accumulated impairment losses. Goodwill is not amortised but instead, it is reviewed for impairment annually or more frequent when there is objective evidence that the carrying value may be impaired, in accordance with the accounting policy disclosed in impairment of assets. Gains or losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold. (iii) Software Software which forms an integral part of the related hardware is capitalised with that hardware and included within property, plant and equipment. Software which are not an integral part of the related hardware are capitalised as intangible assets. Acquired computer software licenses are capitalised on the basis of the costs incurred to acquired and bring to use the specific software. These costs are amortised over their estimated useful life of 10 years. Impairment of assets The carrying amounts of assets are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists then the asset’s recoverable amount is estimated. For goodwill that has an indefinite useful life, recoverable amount is estimated at each reporting date or more frequently when indications of impairment are identified. An impairment loss is recognized if the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount unless the asset is carried at a revalued amount, in which case the impairment loss is recognised directly against any revaluation surplus for the asset to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that same asset. A cash-generating unit is the smallest identifiable asset group that generates cash flows that are largely independent from other assets and groups. Impairment losses are recognized in the income statement in the period in which it arises. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other assets in the unit (group of units) on a pro rata basis. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 42 I 2. ACCOUNTING POLICIES (Continued) Impairment of assets (Continued) The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognized for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognized in the income statement unless the asset is carried at revalued amount, in which case, such reversal is treated as a revaluation increase. Property, plant and equipment (a) Recognition and measurement Property, plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to working condition for its intended use, and the costs of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. The cost of property, plant and equipment recognised as a result of a business combination is based on fair value at acquisition date. The fair value of property is the estimated amount for which a property could be exchanged on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion. The fair value of other items of plant and equipment is based on the quoted market prices for similar items. When significant parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. (b) Subsequent costs The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and its cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in the income statement as incurred. (c) Depreciation Depreciation is recognised in the income statement on a straight-line basis over the estimated useful lives of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives. Property, plant and equipment under construction are not depreciated until the assets are ready for their intended use. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 43 I 2. ACCOUNTING POLICIES (Continued) Property, plant and equipment (Continued) (c) Depreciation (Continued) The estimated useful lives for the current and comparative periods are as follows: Building 50 years Motor vehicles 5 years Leasehold improvement 10 years Electronic Data Capture equipment 10 years Computer equipment 3 to 5 years Computer software 10 years Furniture and fittings 10 years Office equipment 10 years Renovation 10 years The depreciable amount is determined after deducting the residual value. Depreciation methods, useful lives and residual values are reassessed at each financial period end. Upon disposal of an asset, the difference between the net disposal proceeds and the carrying amount of the assets is charged or credited to the income statement. On disposal of a revalued asset, the attributable revaluation surplus remaining in the revaluation reserve is transferred to the distribution reserve. Investments Investments in subsidiary companies are stated at cost less any provision for impairment. Inventories Inventories are valued at the lower of cost and net realisable value and are determined on the first-in-first-out method, after making due allowance for obsolete and slow moving items. Net realisable value is based on estimated selling price in the ordinary course of business less the costs of completion and selling expenses. Financial assets Trade and other receivables are recognised initially at fair value and subsequently measured at their cost when the contractual right to receive cash or other financial assets from another entity is established. A provision for doubtful debts is made when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments are considered indicators that a trade and other receivables are impaired. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 44 I 2. ACCOUNTING POLICIES (Continued) Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less which have an insignificant risk of changes in value and bank overdrafts. For the purpose of the Statement of Financial Position, bank overdrafts are presented in borrowings. Financial liabilities Trade and other payables are recognised initially at fair value of the consideration to be paid in the future for goods and services received. Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are recognised as part of the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. When the borrowings are made specifically for the purpose of obtaining a qualifying asset, the amount of borrowing costs eligible for capitalisation is the actual borrowing costs incurred on that borrowing during the period less any investment income on the temporary investment of funds drawndown from those borrowings. When the borrowings are made generally, and used for the purpose of obtaining a qualifying asset, the borrowing costs eligible for capitalization are determined by applying a capitalization rate which is weighted on the borrowing costs applicable to the Group’s borrowings that are outstanding during the financial period, other than borrowings made specifically for the purpose of acquiring another qualifying asset. Borrowing costs which are not eligible for capitalization are recognised as an expense in the profit or loss in the period in which they are incurred. Equity instruments Instruments that evidence a residual interest in the assets of the Group after deducting all of its liabilities are classified as equity instruments. Issued equity instruments are recorded at proceeds received net of direct issue costs. 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 value added tax, from the proceeds. Financial instruments Financial instruments carried on the Statement of Financial Position include cash and bank balances, deposits, investments, receivables, payables and borrowings. Financial instruments are recognised in the Statement of Financial Position when the Group has become a party to the contractual provisions of the instrument. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 45 I 2. ACCOUNTING POLICIES (Continued) Financial instruments (Continued) Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual arrangement. Interest, dividends and gains and losses relating to a financial instrument classified as a liability, are reported as an expense or income. Distributions to holders of financial instruments classified as equity are charged directly to equity. Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle either on a net basis or to realise the asset and settle the liability simultaneously. The particular recognition method adopted for financial instruments recognised on the Statement of Financial Position is disclosed in the individual accounting policy statements associated with each item. Share based payments Charges for employees services received in exchange for share based payments have been made for all options granted in accordance with IFRS 2 “Share Based Payments” options granted under the Group’s employee share scheme are equity settled. The fair value of such options has been calculated using a Black-Scholes model, based upon publicly available market data, and is charged to the profit or loss over the vesting period. Segment reporting Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision makers are responsible for allocating resources and assessing performance of the operating segments and make overall strategic decisions. The Group’s operating segments are organised and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets. 3. FINANCIAL INSTRUMENTS D )LQDQFLDOULVNPDQDJHPHQWREMHFWLYHVDQGSROLFLHV The Group and the Company’s financial risk management policy is to ensure that adequate financial resources are available for the development of the Group and of the Company’s operations whilst managing its financial risks, including interest rate risk, credit risk, foreign currency exchange risk, liquidity and cash flow risk and capital risk. The Group and the Company operates within clearly defined guidelines that are approved by the Board and the Group’s policy is not to engage in speculative transactions. E ,QWHUHVWUDWHULVN Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate because of changes in market interest rates. Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. As the Group has no significant interest-bearing financial assets, the Group’s income and operating cash flows are substantially independent of changes in market interest rates. The Group’s interest rate risk arises primarily from interest-bearing borrowings. Borrowings at floating rates expose the Group to cash flow interest rate risk. Borrowings obtained at fixed rates expose the Group to fair value interest rate risk. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 46 I 3. FINANCIAL INSTRUMENTS (Continued) E ,QWHUHVWUDWHULVN &RQWLQXHG The following tables set out the carrying amounts, the effective interest rates as at the Statement of Financial Position date and the remaining maturities of the Group’s financial instruments that are exposed to interest rate risk: At 31 December 2022 Fixed rate: Fixed deposits Leases liabilities Floating rate: Bankers’ acceptance Term loan At 31 December 2021 Fixed rate: Fixed deposits Leases liabilities Floating rate: Bankers’ acceptance Term loan Total £ 1,768,584 (215,655) (3,638,665) (230,514) 1,508,388 (168,474) (1,951,020) (225,702) 2-5 years £ - (50,102) - (20,713) - (41,344) - (18,513) Within 1 year £ 1,768,584 (113,860) (3,638,665) (8,817) 1,508,388 (89,613) (1,951,020) (7,821) More than 5 years £ - - - (191,551) - (4,632) - (190,973) 1-2 years £ - (51,693) - (9,433) - (32,885) - (8,395) Effective Interest Rate % 1.40-2.60 2.42-4.00 3.8-5.13 4.15 1.40-1.75 2.42-4.00 2.46-4.97 3.99 Note 18 14 24 24 18 14 24 24 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 47 I 3. FINANCIAL INSTRUMENTS (Continued) E ,QWHUHVWUDWHULVN FRQWLQXHG Sensitivity analysis for interest rate risk The interest rate profile of the Group’s significant interest-bearing financial instruments, based on carrying amounts as at the end of the reporting period was: Floating rate instruments Financial liabilities (Note 24) Interest rate risk sensitivity analysis (i) Fair value sensitivity analysis for fixed rate instruments The Group does not account for any fixed rate financial assets and liabilities at fair value through profit or loss, and the Company does not designate derivatives as hedging instruments under a fair value hedged accounting model. Therefore, a change in interest rates at the end of the reporting period would not affect profit or loss. (ii) Cash flow sensitivity analysis for variable rate instruments A change of 100 basis points (bp) in interest rates at the end of the reporting period would have increased/(decreased) post-tax profit by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency rates, remained constant. 2022 Floating rate instruments 2021 Floating rate instruments 100 bp Decrease £ 38,692 21,767 100 bp Increase £ (38,692) (21,767) Group Profit or Loss Group 2021 £ 2,176,722 2022 £ 3,869,179 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 48 I 3. FINANCIAL INSTRUMENTS (Continued) F &UHGLWULVN The Group’s and the Company’s exposure to credit risk arises mainly from receivables. Receivables are monitored on an ongoing basis via management reporting procedure and action is taken to recover debts when due. At each Statement of Financial Position date, there was no significant concentration of credit risk. The maximum exposure to credit risk for the Group and the Company is the carrying amount of the financial assets shown in the Statement of Financial Position. G )RUHLJQFXUUHQF\H[FKDQJHULVN The Group is exposed to foreign currency risk on transaction that are denominated in foreign currency of Ringgit Malaysia (RM). The Group has not entered into any derivative instruments for hedging or trading purposes as the net exposure to foreign currency risk is not significant. Where possible, the Group will apply natural hedging by selling and purchasing in the same currency. However, the exposure to foreign currency risk is monitored from time to time by management. The carrying amounts of the Group’s foreign currency denominated financial assets and financial liabilities at the end of the reporting period are as follows: 2022 Group Deposits, cash and bank balances Trade and other receivables Amount due from an associate Trade and other payables Lease liabilities Loans and borrowings Net currency exposure 2021 Group Deposits, cash and bank balances Trade and other receivables Amount due from an associate Trade and other payables Lease liabilities Loans and borrowings Net currency exposure Denominated in RM £ 5,015,172 2,367,645 - (2,916,524) (203,766) (3,869,179) 393,348 4,654,276 3,177,680 - (5,202,398) (155,489) (2,176,722) 297,347 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 49 I 3. FINANCIAL INSTRUMENTS (Continued) G )RUHLJQFXUUHQF\H[FKDQJHULVN FRQWLQXHG Sensitivity analysis for foreign currency exchange risk The following table demonstrates the sensitivity of the Group’s profit before tax to a reasonably possible change in RM exchange rates against £, with other variables held constant. Group Change in currency rate RM Strengthen 10% Weakened 10% Effect on profit before tax 2021 £ (29,735) 29,735 2022 £ (39,335) 39,335 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 50 I 3. FINANCIAL INSTRUMENTS (Continued) H /LTXLGLW\DQGFDVKpRZULVNV The Group and the Company seeks to achieve a flexible and cost effective borrowing structure to ensure that the projected net borrowing needs are covered by available committed facilities. Debt maturities are structured in such a way to ensure that the amount of debt maturing in any one year is within the Group’s and the Company’s ability to repay and/or refinance. The Group and the Company also maintains a certain level of cash and cash convertible investments to meet its working capital requirements. The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the reporting date based on contractual undiscounted repayment obligations: 2022 Group Financial liabilities Trade and other payables Amount due to Directors Lease liabilities Loans and borrowings Total undiscounted financial liabilities 2021 Group Financial liabilities Trade and other payables Amount due to Directors Lease liabilities Loans and borrowings Total undiscounted financial liabilities Total £ 3,011,239 2,672 203,766 3,869,179 7,086,856 5,203,551 124,426 168,474 2,176,722 7,673,173 On demand over five year £ - - - 191,551 191,551 - - 4,632 - 4,632 On demand one to five year £ - - 89,906 30,146 120,052 - - 74,229 217,881 292,110 On demand or within one year £ 3,011,239 2,672 113,860 3,647,482 6,775,253 5,203,551 124,426 89,613 1,958,841 7,376,431 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 51 I 3. FINANCIAL INSTRUMENTS (Continued) H /LTXLGLW\DQGFDVKpRZULVNV FRQWLQXHG The table below summarises the maturity profile of the Group’s and the Company’s liabilities at the reporting date based on contractual undiscounted repayment obligations: (Cont’d) 2022 Company Financial liabilities Trade and other payables Amount due to Directors Amount due to subsidiary company Total undiscounted financial liabilities 2021 Company Financial liabilities Trade and other payables Amount owing to Directors Amount due to subsidiary company Total undiscounted financial liabilities (f) Fair Values The carrying amounts of financial assets and financial liabilities are reasonable approximation of fair value due to their short term nature. The carrying amounts of the current portion of borrowing is reasonable approximation of fair value due to the insignificant impact of discounting. J &DSLWDOULVN The Group’s and the Company’s objectives when managing capital are to safeguard the Group’s and the Company’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group and the Company may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt. Total £ 74,841 612,703 687,544 901 121,915 367,605 490,421 On demand over five year £ - - - - - - - - On demand one to five year £ - - - - - - - - On demand or within one year £ 74,841 612,703 687,544 901 121,915 367,605 490,421 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 52 I 4. EMPLOYEES AND DIRECTORS EMPLOYEES Wages, salaries and bonuses Social security contribution Contribution to defined contribution plan Other staff related expenses Continuing operations DIRECTORS Fees Wages, salaries and bonuses Social security contribution Contribution to defined contribution plan Continuing operations Group 2021 £ 1,623,690 14,220 151,504 12,792 1,802,206 85,939 231,698 386 26,450 344,473 2022 £ 1,788,138 15,910 165,287 17,119 1,986,454 169,859 155,729 538 18,500 344,626 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 53 I 4. EMPLOYEES AND DIRECTORS (Continued) The number of employees (excluding Directors) of the Group and of the Company at the end of the financial year were 110 (2021: 120) and Nil (2021: Nil) respectively. The details of remuneration received and receivables by the Directors of the Group during the financial year are as follows: Group 2022 Company’s Directors: Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai Seah Boon Chin Azlinda Ezrina Binti Ariffin Subsidiary companies’ Directors: Tengku Muhaini Binti Sultan Hj. Ahmad Shah Abu Bakar bin Mohd Taib Haji Zaim Dato Paduka Bin Haji Sabtu Lee Hock Leong Group 2021 Company’s Directors: Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai Seah Boon Chin Azlinda Ezrina Binti Ariffin Subsidiary companies’ Directors: Tengku Muhaini Binti Sultan Hj. Ahmad Shah Abu Bakar bin Mohd Taib Haji Zaim Dato Paduka Bin Haji Sabtu Lee Hock Leong Total £ 127,689 101,682 43,800 17,000 13,254 6,627 3,525 31,049 344,626 123,396 103,387 43,800 11,500 20,349 6,315 3,246 32,480 344,473 Social security contribution £ 340 184 - - - - - 14 538 162 162 - - - - - 62 386 Salaries and allowances £ 81,730 68,477 - - - - - 5,522 155,729 77,888 113,594 - 2,500 - - - 28,945 222,927 Defined contribution plan £ 9,619 8,218 - - - - - 663 18,500 9,346 13,631 - - - - - 3,473 26,450 Bonuses £ - - - - - - - - - - - - - 8,771 - - - 8,771 Fees £ 36,000 24,803 43,800 17,000 13,254 6,627 3,525 24,850 169,859 36,000 (24,000) 43,800 9,000 11,578 6,315 3,246 - 85,939 * Re-assignment of Derrick Chia Kah Wai’s fees payable by the Company to salaries payable by MobilityOne Sdn Bhd. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 54 I 5. OPERATING SEGMENTS The information reported to the Group’s chief operating decision maker to make decisions about resources to be allocated and for assessing their performance is based on the nature of the products and services, and has two reportable operating segments as follows: (a) Telecommunication services and electronic commerce solutions; and (b) Hardware Except as above, no other operating segment has been aggregated to form the above reportable operating segments. Measurement of Reportable Segments Segment information is prepared in conformity with the accounting policies adopted for preparing and presenting the consolidated financial statements. No segment assets and capital expenditure are presented as they are mostly unallocated items which comprise corporate assets and liabilities. No geographical segment information is presented as more than 95% of the Group’s revenue for the financial ended 31 December 2022 was generated in Malaysia. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 55 I 5. OPERATING SEGMENTS (Continued) Group 2022 Segment revenue: External customers Inter-segment Profit before tax Tax Profit for the year Non-cash expenses/(income) * Amortisation of intangible assets Amortisation of right-of-use assets Bad debt written off Depreciation of property, plant and equipment * The disclosure for non-cash expenses has not been split according to the different segments as the cost to obtain such information is excessive and provides very little by way of information. Total £ 233,761,671 - 233,761,671 278,978 (262,350) 16,628 68,051 132,580 5,622 282,260 488,513 Telecommunication services and electronic commerce solutions £ 230,754,843 - 230,754,843 278,978 (262,350) 16,628 68,051 132,580 5,622 282,260 488,513 Elimination £ - (289,703) (289,703) - - - Hardware and services £ 3,006,828 289,703 3,296,531 - - - NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 56 I 5. OPERATING SEGMENTS (Continued) Group 2021 Segment revenue: External customers Inter-segment Profit before tax Tax Profit for the year Non-cash expenses/(income)* Amortisation of intangible assets Amortisation of right-of-use assets Bad debt written off Depreciation of property, plant and equipment Inventories written off * The disclosure for non-cash expenses has not been split according to the different segments as the cost to obtain such information is excessive and provides very little by way of information. Total £ 255,707,270 - 255,707,270 2,015,835 (507,582) 1,508,253 64,864 104,169 36,339 243,980 182 449,534 Telecommunication services and electronic commerce solutions £ 252,841,803 - 252,841,803 2,015,835 (507,582) 1,508,253 64,864 104,169 36,339 243,980 182 449,534 Elimination £ - (382,781) (382,781) - - - Hardware £ 2,865,467 382,781 3,248,248 - - - NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 57 I 6. FINANCE COSTS Bankers’ acceptance interest Bank guarantee interest Bank overdraft Lease liabilities Term loan Less: Finance costs from discontinued operation 7. PROFIT BEFORE TAX Profit before tax is stated after charging/(crediting): Auditors’ remuneration - Statutory audit - Current year - Under provided in prior year Amortisation of intangible assets Amortisation of right-of-use assets Bad debt written off Depreciation of property, plant and equipment Deposit written-off Directors’ remunerations Gain on disposal of property, plant and equipment Gain on disposal of subsidiary company Impairment loss on goodwill Impairment loss on trade receivable Impairment loss on other receivable Inventories written off Interest income (Gain)/Loss on foreign exchange - realised - unrealised Operating lease payment of premises and equipment Reversal of impairment loss on trade receivable Waiver of debts Group 2021 £ 86,111 7,734 4,253 8,564 8,958 115,620 - 115,620 2022 £ 106,465 6,631 4,692 10,286 9,069 137,143 - 137,143 2021 £ 34,484 70 64,864 104,169 36,339 243,980 - 344,473 (3,508) - 99,939 - - 182 (12,867) 1,388 71,356 28,879 - (99,025) 2022 £ 37,148 (2,761) 68,051 132,580 5,622 282,260 9,112 344,626 (8,464) - 177,546 282,535 3,403 - (35,933) 7 (22,279) 51,128 (5,061) - Note 11 14 12 4 12 11 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 58 I 8. TAX Current tax expense: Jersey corporation tax for the year Foreign tax (Over) provision in prior year Deferred tax expense: Relating to origination and reversal of temporary difference Under/(over) provision of taxation in prior year A reconciliation of income tax expense applicable to profit before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Group is as follows: Profit before taxation Taxation at Malaysian statutory tax rate of 24% (2021: 24%) Effect of different tax rates in other countries Effect of expenses not deductible for tax Income not taxable for tax purpose Deferred tax assets not recognised Utilisation of previously unrecognised tax loss and CA (Over) provision of deferred tax in prior year Under/(over) provision of tax expense in prior year Tax expense for the year 2021 £ 2,015,835 483,653 (1,377) 137,503 (842) (3,775) (17,143) (6,001) (84,436) 507,582 Group Group 2021 £ - 605,596 (84,436) 521,160 (7,577) (6,001) (13,578) 507,582 2022 £ - 299,354 (7,966) 291,388 (31,990) 2,952 (29,038) 262,350 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 2022 £ 278,978 66,955 10,060 178,737 (20,583) 31,238 957 2,952 (7,966) 262,350 I 59 I 8. TAX (Continued) As at 31 December 2022, the unrecognised deferred tax assets of the Group are as follows: Unabsorbed tax losses Unabsorbed capital allowances The potential net deferred tax assets amounting to Nil (2021: Nil) has not been recognised in the financial statements because it is not probable that future taxable profit will be available against which the subsidiary company can utilise the benefits. The availability of the unused tax losses and unabsorbed capital allowances for offsetting against future taxable profits of the subsidiary company is subject to no substantial changes in shareholdings of the subsidiary company under Section 44(5A) and (5B) of Income Tax Act, 1967, in Malaysia. 9. LOSS OF COMPANY The profit or loss of the Company is not presented as part of these financial statements. The Company’s loss for the financial year was £178,125 (2021: £147,272). 2021 £ 1,027,024 241,514 1,268,538 2022 £ 1,156,282 304,057 1,460,339 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 60 I 10. PROFIT PER SHARE Profit attributable to owners of the Parent for the computation of basic earnings per share Profit from continuing operations Issued ordinary shares at 1 January Effect of ordinary shares changes during the period Weighted average number of shares at 31 December Fully diluted weighted average number of shares at 31 December Profit Per Share Basic earnings per share (pence) Diluted earnings per share (pence) Profit Per Share from continuing operations Basic earnings per share (pence) Diluted earnings per share (pence) The basic earnings per share is calculated by dividing the profit of £23,857 (2021: profit of £1,524,429) attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year, which is 106,298,780 (2021: 106,298,780). The diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the exercise of outstanding dilutive share options. 2021 £ 1,524,429 106,298,780 - 106,298,780 113,656,903 1.434 1.341 1.434 1.341 2022 £ 23,857 106,298,780 - 106,298,780 112,623,648 0.022 0.021 0.022 0.021 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 61 I 11. INTANGIBLE ASSETS GROUP 31 December 2022 At cost At 1 January 2022 Addition Foreign exchange differences At 31 December 2022 Accumulated amortisation and impairment loss At 1 January 2022 Amortisation charge for the year Impairment loss recognise Foreign exchange differences At 31 December 2022 Net Carrying Amount At 31 December 2022 31 December 2021 At Cost At 1 January 2021 Addition Foreign exchange differences At 31 December 2021 Accumulated amortisation and impairment loss At 1 January 2021 Amortisation charge for the year Impairment loss recognise Foreign exchange differences At 31 December 2021 Net Carrying Amount At 31 December 2021 Total £ 3,627,023 - 231,873 3,858,860 3,193,179 68,051 177,546 205,904 3,644,680 214,180 3,295,011 453,662 (121,650) 3,627,023 3,144,227 64,864 99,939 (115,851) 3,193,179 433,844 Development Costs £ 930,598 - 59,484 990,082 930,598 - - 59,484 990,082 - 994,856 - (64,258) 930,598 994,856 - - (64,258) 930,598 - Goodwill on consolidation £ 1,689,693 - 108,004 1,797,697 1,321,515 - 177,546 84,470 1,583,531 214,166 1,267,661 453,662 (31,630) 1,689,693 1,251,570 - 99,939 (29,994) 1,321,515 368,178 Software £ 1,006,732 - 64,349 1,071,081 941,066 68,051 - 61,950 1,071,067 14 1,032,494 - (25,762) 1,006,732 897,801 64,864 - (21,599) 941,066 65,666 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 62 I 11. INTANGIBLE ASSETS (Continued) The Group assesses at each reporting date whether there is an indication that an asset may be impaired, by considering the net present value of discounted cash flows forecasts. If an indication exists an impairment review is carried out. Goodwill on consolidation (a) Impairment testing for goodwill on consolidation Goodwill on consolidation has been allocated for impairment testing purposes to the individual entities which is also the cash-generating units (“CGU”) identified. (b) Key assumptions used to determine recoverable amount The recoverable amount of a CGU is determined based on value in use calculations using cash flow projections based on financial budgets approved by the Directors covering 5 years period. The projections are based on the assumption that the Group can recognise projected sales which growth at 10% per annum which is based on expected clientele over time. A prudent approach has been applied with no residual value being factored into these calculations. If the projected sales do not materialise there is a risk that the total value of the intangible assets shown above would be impaired. A pre-tax discount rate of 8% (2020: 8%) per annum was applied to the cash flow projections, after taking into consideration the Group’s cost of borrowings, the expected rate of return and various risks relating to the CGU. The directors have relied on past experience and all external evidence available in determining the assumptions. During the financial year, the Group impairment loss amounting to £172,974 (2021: 99,939) in respect of the goodwill on consolidation. A significant proportion of goodwill on consolidation relates to the acquisition of OneTransfer Remittance Sdn Bhd which is a CGU and has a carrying amount of £214,166 (2021: £368,178). Its recoverable amount has been determined based on a net total assets calculation using discounting future cash flow to be generated by the CGU and key assumptions as described in (b) above. Development costs Development costs will not be amortised if the product is still in its development phase. The amortisation of the development costs is over 5 years period, which in the opinion of the Directors is adequate. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 63 I 12. PROPERTY, PLANT AND EQUIPMENT Group 31 December 2022 At Cost At 1 January 2022 Additions Disposals Foreign exchange differences At 31 December 2022 At 1 January 2022 Depreciation charge for the year Disposals Foreign exchange differences At 31 December 2022 NET CARRYING AMOUNT At 31 December 2022 Total £ 2,928,016 390,056 (17,986) 197,653 3,497,739 1,977,352 282,260 (17,986) 133,919 2,375,545 1,122,194 Office equipment £ 83,638 49,867 - 6,852 140,357 59,207 15,036 - 4,249 78,492 61,865 Computer software £ 134,244 18,115 - 9,059 161,418 57,112 12,704 - 3,986 73,802 87,616 Electronic Data Capture equipment £ 982,244 7,529 - 62,983 1,052,756 714,633 128,660 - 49,080 892,373 160,383 Renovation £ 188,569 - - 12,053 200,622 123,086 19,099 - 8,373 150,558 50,064 Furniture and fittings £ 123,627 3,351 - 7,990 134,968 94,399 6,105 - 6,196 106,700 28,268 Computer equipment £ 806,822 311,194 - 59,797 1,177,813 592,556 94,025 - 40,360 726,941 450,872 Motor Vehicles £ 289,003 - (17,986) 18,473 289,490 289,002 - (17,986) 18,473 289,489 1 Building £ 319,869 - - 20,446 340,315 47,357 6,631 - 3,202 57,190 283,125 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 64 I 12. PROPERTY, PLANT AND EQUIPMENT Group 31 December 2021 At Cost At 1 January 2021 Additions Written off Transfer from ROU Disposals Transfer from inventories Acquisition of subsidiary Foreign exchange differences At 31 December 2021 At 1 January 2021 Depreciation charge for the year Disposals Transfer from ROU Acquisition of subsidiary Foreign exchange differences At 31 December 2021 NET CARRYING AMOUNT At 31 December 2021 Total £ 2,050,997 34,866 - 400,750 (18,545) 11,153 493,398 (44,603) 2,928,016 1,327,126 243,980 (18,545) 198,893 255,989 (30,091) 1,977,352 950,664 Office equipment £ 68,756 - - - - - 16,353 (1,471) 83,638 42,419 4,844 - - 12,936 (992) 59,207 24,431 Computer software £ 120,395 16,647 - - - - - (2,798) 134,244 48,075 10,111 - - - (1,074) 57,112 77,132 Electronic Data Capture equipment £ 668,378 - - 319,665 - 10,878 - (16,677) 982,244 471,426 130,815 - 122,538 - (10,146) 714,633 267,611 Renovation £ 90,040 6,315 - - - - 93,231 (1,017) 188,569 63,062 15,733 - - 45,670 (1,379) 123,086 65,483 Furniture and fittings £ 114,256 2,851 - - - - 9,222 (2,702) 123,627 84,766 5,398 - - 6,283 (2,048) 94,399 29,228 Computer equipment £ 441,974 9,053 - - - 275 361,962 (6,442) 806,822 356,226 66,088 - - 178,313 (8,071) 592,556 214,266 Motor Vehicles £ 219,144 - - 81,085 (18,545) - 12,630 (5,311) 289,003 219,144 4,672 (18,545) 76,355 12,787 (5,411) 289,002 1 Building £ 328,054 - - - - - - (8,185) 319,869 42,008 6,319 - - - (970) 47,357 272,512 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 65 I 12. PROPERTY, PLANT AND EQUIPMENT (Continued) (a) Cash payments of £390,056 (2021: £34,866) were made by the Group to purchase property, plant and equipment. (b) Assets pledged as securities to licensed banks The carrying amount of property, plant and equipment of the Group and of the Company pledged as securities for bank borrowings as disclosed in Note 24 to the financial statement are: Building 13. INVESTMENT IN SUBSIDIARY COMPANIES AT COST At 1 January Less: Disposal of subsidiary company At 31 December 2021 £ 1,976,339 - 1,976,339 2022 £ 1,976,339 - 1,976,339 Company 2021 £ 272,512 2022 £ 283,125 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 66 I Name of Subsidiary Companies MobilityOne Sdn. Bhd.* M1 AP Sdn. Bhd.* M-One Tech Ltd. Direct subsidiary companies of MobilityOne Sdn. Bhd. M1 Pay Sdn. Bhd.* MobilityOne Philippines, Inc* One Tranzact Sdn. Bhd.* MobilityOne (B) Sdn. Bhd.* OneShop Retail Sdn. Bhd.* M1 Merchant Sdn. Bhd.* Onetransfer Remittance Sdn. Bhd.* Country of incorporation Malaysia Malaysia United Kingdom Malaysia Philippines Malaysia Brunei Malaysia Malaysia Malaysia Effective Ownership of Ordinary Shares Interest ** 2022 2021 (%) (%) 100 100 100 100 100 100 100 100 95 95 100 100 99 99 100 100 60 60 100 100 Principal Activities Provision of e-Channel products and services, technology managed services and solution sales and consultancy Investment holding company Inactive Provision of solution sales and services Provision of IT systems and solutions and to establish a multi-channel electronic service bureau Provision of electronic payment and product fulfillment Financial services General merchant retail sales in all type of goods, materials and commodities Provision of solutions and services in relation to electronic payments via terminals, mobile devices or any its related business Provider for International remittance services * Audited by firm of auditors other than Jeffreys Henry LLP. ** All the above subsidiary undertakings are included in the consolidated financial statements. 13. INVESTMENT IN SUBSIDIARY COMPANIES (Continued) Details of the subsidiary companies are as follows: NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 67 I 13. INVESTMENT IN SUBSIDIARY COMPANIES (Continued) Acquisition of subsidiary company On 26 February 2021, MobilityOne Sdn Bhd (“M1 Malaysia”) entered into an agreement to acquire 4,505,000 shares, representing the remaining 50% equity interest in OneTransfer Remittance Sdn. Bhd. (“OTR”) for a total cash consideration of RM3,000,000. This acquisition completed on 7 April 2021 following the requisite approval being received from Bank Negara Malaysia. Consequently, OTR ceased to be an associated company and become a wholly-owned subsidiary company of M1 Malaysia The following summarise the major classes of consideration transferred, and the recognised amounts of assets acquired and liabilities assumed at the acquisition date: Fair value of consideration transferred Cash consideration Less: Fair value of equity interest in OTR held by the Group immediately before the acquisition Total consideration transferred Fair value of identifiable assets acquired and liabilities assumed Property, plant and equipment Right-of-use assets Other receivables Cash and bank balances Lease liabilities Other payables Total identifiable assets and liabilities Net cash outflow arising from acquisition of subsidiary company Purchase consideration settled in cash Less: cash and cash equivalents acquired Goodwill arising from business combination Fair value of consideration transferred Non-controlling interests, based on their proportionate interest in the recognised amounts of the assets and liabilities of the acquiree Fair value of existing interest in the acquiree Fair value of identifiable assets acquired and liabilities assumed Goodwill 2021 £ 532,774 - 532,774 243,508 158,166 157,908 156,258 (123,548) (513,180) 79,112 532,774 (156,257) 376,517 532,774 - - (79,112) 453,662 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 68 I 13. INVESTMENT IN SUBSIDIARY COMPANIES (Continued) Additional interest in subsidiary companies On 27 September 2021, M1 Malaysia further subscribed for additional 1,250,000 ordinary shares in OTR for RM1 each for a total consideration of RM1,250,000. OTR remained as a wholly-owned subsidiary company of M1 Malaysia. During the financial year, M1 Merchant Sdn. Bhd. (“M1 Merchant”) increased its share capital from RM10 to RM300,000 through the allotment of 299,990 ordinary shares of RM1 each. M1 Malaysia subscribed for 179,994 ordinary shares in M1 Merchant. The shareholding of M1 Malaysia in M1 Merchant remained as 60%. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 69 I 14. RIGHT-OF-USE ASSETS Group 2022 At Cost At 1 January 2022 Additions Written off Expiration of lease contract Foreign exchange differences At 31 December 2022 Accumulated Amortisation At 1 January 2022 Charge for the financial year Written off Expiration of lease contract Foreign exchange differences At 31 December 2022 Carrying Amount At 31 December 2022 Total £ 488,487 152,494 (5,019) (68,380) 34,759 602,341 332,827 132,580 (2,008) (68,380) 24,387 419,406 182,935 Leasehold improvement £ 9,627 - - - 252 9,879 8,382 986 - - 222 9,590 289 Office Equipment £ 12,329 - - - 788 13,117 3,699 2,236 - - 295 6,230 6,887 Building £ 161,351 152,494 (5,019) (68,380) 14,212 254,658 97,009 98,214 (2,008) (68,380) 8,745 133,580 121,078 Motor vehicles £ 305,180 - - - 19,507 324,687 223,737 31,144 - - 15,125 270,006 54,681 Electronic Data Capture equipment £ - - - - - - - - - - - - - NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 70 I 14. RIGHT-OF-USE ASSETS (Continued) Group 2021 At Cost At 1 January 2021 Additions Transfer to property, plant and equipment Acquisition of subsidiary Expiration of lease contract Foreign exchange differences At 31 December 2021 Accumulated Amortisation At 1 January 2021 Charge for the financial year Transfer to property, plant and equipment Expiration of lease contract Acquisition of subsidiary Foreign exchange differences At 31 December 2021 Carrying Amount At 31 December 2021 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 Total £ 607,319 20,253 (400,750) 333,768 (61,114) (10,989) 488,487 315,717 104,169 (198,893) (60,368) 177,534 (5,332) 332,827 155,660 Leasehold improvement £ 10,091 - - - - (464) 9,627 7,777 978 - - - (373) 8,382 1,245 Office Equipment £ - - - 12,178 - 151 12,329 - 2,030 - - 1,624 45 3,699 8,630 Building £ 128,595 - - 95,894 (61,114) (2,024) 161,351 96,446 43,725 - (60,368) 19,576 (2,370) 97,009 64,342 Motor vehicles £ 140,788 20,253 (81,085) 225,696 - (472) 305,180 102,213 41,648 (76,355) - 156,334 (103) 223,737 81,443 Electronic Data Capture equipment £ 327,845 - (319,665) - - (8,180) - 109,281 15,788 (122,538) - - (2,531) - - I 71 I 14. RIGHT-OF-USE ASSETS (Continued) Lease liabilities At 1 January Addition Payments Written off Acquisition of a subsidiary company Foreign currency translation differences At 31 December Presented as: Non-current Current Minimum lease payments: Not later than 1 year Later than 1 year but not later than 2 years Later than 2 years but not later than 5 years Later than 5 years Less: Future finance charges Present value of lease liabilities Group 2021 Total £ 149,709 14,563 (122,576) - 116,092 (2,299) 155,489 883,501 71,988 155,489 89,613 32,885 41,344 4,632 168,474 (12,985) 155,489 Group 2022 Total £ 155,489 156,525 (116,670) (1,477) - 9,899 203,766 98,450 105,316 203,766 113,860 51,693 50,102 - 215,655 (11,889) 203,766 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 72 I 15. INVENTORIES At lower of cost and net realisable value: Airtime Electronic date capture equipment Card Trading goods Recognised in profit or loss: Cost of sales Written off 16. INVESTMENT IN ASSOCIATE COMPANY At cost: Unquoted shares in Malaysia Additional Disposal Share of post-acquisition reserve Accumulated impairment losses: Balance at beginning of the financial year Impairment Reversal due to disposal Balance at end of the financial year Balance at end of the financial year Details of the associate company are as follows: In the previous financial year, OneTransfer Remittance Sdn. Bhd. ceased to be an associated company and become a wholly owned subsidiary company of the Company as disclosed in Note 13. 2021 £ 3,112,248 - 6,192 131 3,118,571 241,709,253 182 2022 £ 3,101,871 79,356 8,548 126 3,189,901 226,744,394 - Group 2021 £ 435,800 - (435,800) - - (435,800) - 435,800 - - 2022 £ - - - - - - - - - - Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 73 I 17. TRADE AND OTHER RECEIVABLES Trade receivables Non-current Trade receivables - Third parties Less: Accumulated impairment loss Current Trade receivables - Third parties Less: Accumulated impairment loss Other receivables Less: Accumulated impairment loss - Deposits - Prepayments - Staff advances Total trade and other receivables The Group’s and the Company’s normal trade credit terms range from 30 to 60 days (2021: 30 to 60 days). Other credit terms are assessed and approved on a case to case basis. 2021 £ - - - - - - - 18 - 18 - - - 18 18 2021 £ - - - 2,312,191 (12,924) 2,299,267 2,299,267 115,205 - 115,205 261,886 496,940 4,400 878,431 3,177,698 2022 £ - - - - - - - - - - - - - - - 2022 £ 234,566 (6,516) 228,050 1,814,150 (284,706) 1,529,444 1,757,494 368,653 (3,403) 365,250 258,827 23,856 2,408 650,341 2,407,835 Company Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 74 I 17. TRADE AND OTHER RECEIVABLES (Continued) (a) Ageing analysis An ageing analysis of trade receivables that are neither individually nor collectively considered to be impaired is as follows: Neither past due nor impaired 1 to 2 months past due 3 to 12 months past due (a) The Group’s and the Company’s normal trade credit terms range from 30 to 60 days (2021: 30 to 60 days). Other credit terms are assessed and approved on a case to case basis. Receivables that were neither past due nor impaired relate to a wide range of customers for whom there was no recent history of default. Receivables that were past due but not impaired relate to a number of independent customers that have a good track record with the Group. Based on past experience, management believes that no impairment allowance is necessary in respect of these balances as there has not been a significant change in credit quality and the balances are still considered fully recoverable. 18. CASH AND CASH EQUIVALENTS Cash in hand and at banks Fixed deposits with licensed bank Cash and cash equivalents (a) The above fixed deposits have been pledged to licensed banks as securities for credit facilities granted to the Group as disclosed in Note 24 to the financial statements. (b) The Group’s effective interest rates and maturities of deposits are range from 1.4% – 2.6% (2021: 1.4% - 2.6%) and from 1 month to 12 months (2021: 1 month to 12 months) respectively. 2021 £ 11,248 - 11,248 2022 £ 11,264 - 11,264 Company 2021 £ 3,157,136 1,508,388 4,665,524 2022 £ 3,246,588 1,768,584 5,015,172 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 2021 £ 419,540 424,107 1,468,544 1,892,657 2,312,191 2022 £ 583,537 408,392 1,056,787 1,465,179 2,048,716 Group I 75 I 19. CALLED UP SHARE CAPITAL Authorised in MobilityOne Limited At 1 January/31 December Issued and fully paid in MobilityOne Limited At 1 January/31 December 20. COMPANY EQUITY INSTRUMENTS 2022 At 1 January 2022 Loss for the year At 31 December 2022 2021 At 1 January 2021 Loss for the year At 31 December 2021 21. REVERSE ACQUISITION RESERVE The acquisition of MobilityOne Sdn. Bhd. by MobilityOne Limited, which was affected through a share exchange, was completed on 5 July 2007 and resulted in MobilityOne Sdn. Bhd. becoming a wholly owned subsidiary of MobilityOne Limited. Pursuant to a share swap agreement dated 22 June 2007 the entire issued and paid-up share capital of MobilityOne Sdn. Bhd. was transferred to MobilityOne Limited by its owners. The consideration to the owners was the transfer of 178,800,024 existing ordinary shares and the allotment and issuance by MobilityOne Limited to the owners of 81,637,200 ordinary shares of 2.5p each. The acquisition was completed on 5 July 2007. Total cost of investment by MobilityOne Limited is £2,040,930, the difference between cost of investment and MobilityOne Sdn. Bhd. share capital of £708,951 has been treated as a reverse acquisition reserve. Total £ 1,533,822 (178,125) 1,355,697 1,681,094 (147,272) 1,533,822 Retained earnings £ (2,033,120) (178,125) (2,211,245) (1,885,848) (147,272) (2,033,120) Share premium £ 909,472 - 909,472 909,472 - 909,472 Share capital £ 2,657,470 - 2,657,470 2,657,470 - 2,657,470 2021 £ 10,000,000 2,657,470 2022 £ 10,000,000 2,657,470 2021 £ 400,000,000 106,298,780 2022 £ 400,000,000 106,298,780 Number of ordinary shares of £0.025 each Amount NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 76 I 22. FOREIGN CURRENCY TRANSLATION RESERVE The subsidiary companies’ assets and liabilities stated in the Statement of Financial Position were translated into Sterling Pound (£) using the closing rate as at the Statement of Financial Position date and the Income Statements were translated into £ using the average rate for that period. All resulting exchange differences are taken to the foreign currency translation reserve within equity. At 1 January Currency translation differences during the year At 31 December The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations whose functional currencies are different from that of the Group’s presentation currency. It is also used to record the exchange differences arising from monetary items which form part of the Group’s net investment in foreign operations, where the monetary item is denominated in either the functional currency of the reporting entity or the foreign operation. 23. RETAINED EARNINGS Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders. At 1 January Profit/(Loss) for the year At 31 December 2021 £ 758,382 (65,675) 692,707 2022 £ 692,707 354,975 1,047,682 2021 £ (1,885,848) (147,272) (2,033,120) 2021 £ (1,642,052) 1,524,429 (117,623) 2022 £ (2,033,120) (178,125) (2,211,245) 2022 £ (117,623) 23,857 (93,766) Company Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 77 I 24. FINANCIAL LIABILITIES – LOANS AND BORROWINGS Non-Current Secured: Term loan Current Secured: Bankers’ acceptance Term loan Total Borrowings Secured: Bankers’ acceptance Term loan The bankers’ acceptance and bank overdraft secured by the following: (a) pledged of fixed deposits of a subsidiary company (Note 18); (b) personal guarantee by Dato’ Hussian @ Rizal bin A. Rahman, a Director of the Company; and (c) corporate guarantee by the Company. The term loan is secured by the following: (a) Charge over the Company’s building (Note 12); and (b) joint and several guaranteed by Dato’ Hussian @ Rizal bin A. Rahman and Derrick Chia Kah Wai, the Directors of the Company. The effective interest rates of the Group for the above facilities other than finance leases are as follows: Bankers’ acceptance Term loan Group 2021 £ 217,881 217,881 1,951,020 7,821 1,958,841 1,951,020 225,702 2,176,722 2022 £ 221,697 221,697 3,638,665 8,817 3,647,482 3,638,665 230,514 3,869,179 Group 2021 % 2.46-4.97 3.99 2022 % 3.8-5.13 4.15 NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 78 I 24. FINANCIAL LIABILITIES – LOANS AND BORROWINGS (Continued) The maturity of borrowings (excluding finance leases) is as follows: Within one year Between one to two years Between two to five years More than five years Other information on financial risks of borrowings are disclosed in Note 3. 2021 £ 1,958,841 8,395 18,513 190,973 2,176,722 2022 £ 3,647,482 9,433 20,713 191,551 3,869,179 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 79 I 25. TRADE AND OTHER PAYABLES Trade payables - Third parties Other payables - Deposits - Accruals - Sundry payables - Services tax output Amount due to subsidiary companies Total trade and other payables Add: Amount due to Directors (Note 28) Add: Loans and borrowings (Note 24) Total financial liabilities carried at amortised costs (a) The Group’s normal trade credit terms range from 30 to 90 days (2021: 30 to 90 days). (b) Other payables are non-interest bearing. Other payables are normally settled on an average terms of 60 days (2021: 60 days). 2021 £ - - - 901 - 367,605 368,506 368,506 121,915 - 490,421 2021 £ 1,195,283 223,728 1,319,457 2,460,491 4,592 - 4,008,268 5,203,551 124,426 2,176,722 7,504,699 2022 £ - - 8,033 2,625 - 612,703 623,361 623,361 64,183 - 687,544 2022 £ 1,165,572 197,638 601,267 971,739 10,840 - 1,781,484 2,947,056 66,855 3,869,179 6,883,090 Company Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 80 I 26. AMOUNT DUE TO DIRECTORS Current Dato’ Hussian @ Rizal bin A. Rahman Derrick Chia Kah Wai Seah Boon Chin Azlinda Ezrina binti Ariffin Total amount due to Directors These are unsecured, interest free and repayable on demand. 2021 £ 62,615 48,000 7,300 4,000 121,915 2021 £ 65,126 48,000 7,300 4,000 124,426 2022 £ 121 24,000 37,062 3,000 64,183 2022 £ 2,793 24,000 37,062 3,000 66,855 Company Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 81 I 27. RECONCILIATION OF PROFIT BEFORE TAX TO CASH GENERATED FROM OPERATIONS Cash flow from operating activities Profit before tax Adjustments for: Amortisation of intangible assets Amortisation of right-of-use assets Bad debt written off Deposit written off Depreciation of property, plant and equipment Gain on disposal of subsidiary company Gain on disposal of property, plant and equipment Loss on foreign exchange - unrealised Impairment loss on trade receivables Impairment loss on others receivables Impairment loss on goodwill Interest expenses Inventories written off Interest income Property, plant and equipment written off Reversal on impairment loss on trade receivable Waiver of debts Unrealised loss/(gain) on forex Operating profit before working capital changes (Increase)/Decrease in inventories Decrease/(Increase) in receivables (Increase)/Decrease in amount due to Directors & Shareholder Amount owing to/by related company (Decrease)/Increase in payables Cash (used in)/generated from operations 2021 £ 2,015,835 64,864 104,169 36,339 8,683 243,980 - - - - - 99,939 115,620 182 (12,867) - - (99,025) - 2,577,719 499,324 (848,771) 13,435 - 167,598 2,409,305 2022 £ 278,978 68,051 132,580 5,622 - 282,260 - (8,464) - 282,535 3,403 177,546 137,143 - (35,933) - (5,061) - (22,279) 1,296,381 (71,330) 474,252 (57,571) - (2,256,495) (614,763) Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 82 I 27. RECONCILIATION OF PROFIT BEFORE TAX TO CASH GENERATED FROM OPERATIONS (Continued) Cash flow from operating activities Loss before tax Increase in trade and other receivable Increase/(Decrease) in payables Amount owing to/by subsidiaries company (Decrease)/Increase in amount due to Directors Cash depleted in operations 28. RELATED PARTY TRANSACTIONS At the Statement of Financial Position date, the Group owed the Directors £66,855 (2021: £124,426), the Company owed the Directors £64,183 (2021: £121,915), the Company owed MobilityOne Sdn. Bhd. (“M1 Malaysia”) £612,703 (2021: £367,605), the subsidiary companies of M1 Malaysia owed M1 Malaysia £399,227 (2021: £606,530) and M1 Malaysia owed the subsidiary companies £469,413 (2021: £969,611). The amounts owing to or from the subsidiary companies and related parties are repayable on demand and are interest free. In 2022, M1 continued to rent an office in Sabah, Malaysia from LMS Digital Sdn Bhd (“LMS”) for RM2,500 (c. £460) a month. On 10 February 2022, M1 Malaysia entered into a tenancy agreement with LMS to occupy approximately 4,500 square feet of office space at Wisma LMS, Kuala Lumpur, Malaysia for RM11,250 (c. £2,000) a month. In additional, M1 Malaysia entered into several ordinary course commercial agreements with TFP Solutions Berhad (“TFP”) for the following products and services: (i) to integrate eWallet/eMoney into TFP’s services and white labelling the eWallet/eMoney; (ii) to provide various value added services (including prepaid top-up and bill payment); (iii) to provide online payment gateway; (iv) to provide SMS blasting services; (v) to provide payment terminals and online payment to accept payment via credit/debit cards and eWallets; and (vi) to use SAP Business One software licenses and services from TFP. Dato’ Hussian @ Rizal bin A. Rahman is a director and shareholder of LMS and TFP. 29. ULTIMATE CONTROLLING PARTY In the opinion of the Directors, as at 31 December 2022, the ultimate controlling party in the Company is Dato’s Hussain @ Rizal bin A. Rahman by virtue of his shareholding. 2021 £ (147,272) - (2,000) - 13,500 (135,772) 2022 £ (178,125) 18 73,940 226,098 (121,915) 16 Company NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 83 I 30. CONTINGENT LIABILITIES The Group has the following contingent liabilities: Limit of guarantees Corporate guarantee given to a licensed bank by the Company for credit facilities granted to a subsidiary company Amount utilised Banker’s guarantee in favour of third parties 31. SHARE BASED PAYMENTS During the year ended 31 December 2022, the Company did not grant any new share option to directors and employees of the Group. A total of share options of 10,600,000 shares were granted in 2014. The details of the share options granted in 2014 are shown below: Grant date 5 December 2014 Share price at grant date 1.5p Exercise price 2.5p Option life 10 years Expiry date 4 December 2024 Up to 31 December 2022, share options of 2,000,000 shares had lapsed due to resignation of employees and no options had been exercised. 2021 £ 3,747,181 458,372 2022 £ 5,498,243 456,001 Group NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 84 I 32. SIGNIFICANT EVENT On 19 October 2022, MobilityOne Sdn Bhd (“M1 Malaysia”) entered into a Share Sale Agreement with Super Apps Holdings Sdn Bhd (“Super Apps”) for the disposal by M1 Malaysia of a 60% shareholding in OneShop Retail Sdn Bhd (“1Shop”) to Super Apps (the “Proposed Disposal”). Concurrently, a Joint Venture cum Shareholders Agreement was entered into between M1 Malaysia, Super Apps and 1Shop (“Proposed Joint Venture”). The Proposed Disposal and Proposed Joint Venture are inter-conditional. The Proposed Disposal is subject to the completion of a merger exercise between Technology & Telecommunication Acquisition Corporation (“TETE”) and Super Apps (“Merger Exercise”). Pursuant to the terms of the Proposed Disposal and subject to the completion of the Merger Exercise, M1 Malaysia is expected to receive cash proceeds of RM40.0 million and RM20.0 million within 14 days and 180 days, respectively of completion of the Merger Exercise. In addition, as part of the terms of the Proposed Joint Venture, M1 Malaysia guarantees that 1Shop will achieve revenues of at least RM560.0 million in the financial year ending 31 December 2023 or any other period as mutually agreed (“Revenue Target”). In consideration of M1 Malaysia guaranteeing the Revenue Target, M1 Malaysia will be receiving the shares of TETE with aggregate value of RM20.0 million following 1Shop achieving the Revenue Target. A proxy statement was filed by TETE on 26 June 2023 seeking to, amongst other matters, extend the deadline to complete the Merger Exercise from 20 July 2023 to 20 July 2024. An extraordinary general meeting of TETE will be held on 18 July 2023. 33. SUBSEQUENT EVENTS (1) On 23 January 2023, the Company announced that M-One Tech Limited submitted a revised application to the Financial Conduct Authority (the “FCA”) for authorisation as an electronic money institution to provide e-money services in the UK (the “FCA Application”). Subsequent on 11 May 2023, the Company announced the withdrawal of the FCA Application after receiving further feedback from the FCA requesting, amongst other matters, further information relating to M-One Tech Limited's proposed business plan. (2) On 26 June 2023, the Company announced that M1 Malaysia has entered into a joint venture cum shareholders agreement with Syed Faisal Algadrie Bin Syed Hassan (“Syed Faisal”) to incorporate a new joint venture company in Malaysia to be named "Qube Nexus Sdn Bhd" (“Qube”) to explore any suitable business opportunities for Qube mainly from the Kingdom of Saudi Arabia. M1 Malaysia and Syed Faizal will own 80 per cent. and 20 per cent. of the equity interest in Qube, respectively. NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) For the year ended 31 December 2022 I 85 I NOTICE IS HEREBY GIVEN THAT an Annual General Meeting of MOBILITYONE LIMITED (“Company”) will be held at 4.00 p.m. Malaysia time on 24 July 2023 at Level 2, Wisma LMS, No. 6, Jalan Abd. Rahman Idris, Off Jalan Raja Muda Abdul Aziz, 50300 Kuala Lumpur, Malaysia, and for the purpose of considering and, if thought fit, adopting the following resolutions, at the meeting, or of any adjournment thereof: ORDINARY RESOLUTIONS 1. THAT the Company's accounts and reports of the Directors and Auditors for the year ended 31 December 2022 be adopted. 2. THAT Abu Bakar bin Mohd Taib is re-elected as a Director. 3. THAT Gravita Audit Limited be appointed as Auditors of the Company (in accordance with Article 33 of the Articles of Association of the Company) to hold office until the conclusion of the next annual general meeting. 4. THAT the Directors of the Company be authorised to fix the remuneration of Gravita Audit Limited as Auditors of the Company. BY ORDER OF THE BOARD $EX%DNDUELQ0RKG7DLE Chairman Dated: 30 June 2023 Notes: 1 A member of the Company entitled to attend and vote at the above-mentioned meeting is entitled to appoint a proxy to attend and, on a poll, to vote in his/her place. A proxy may demand, or join in demanding, a poll. A proxy need not be a member of the Company. A member may appoint more than one proxy to attend on the same occasion. 2 The instrument appointing a proxy and the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, shall be deposited with the Company’s registrars, Computershare Investor Services (Jersey) Limited c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, the United Kingdom or at such other place as is specified for that purpose in the notice of the meeting or in the instrument of proxy issued by the Company at least 24 hours before the time appointed for holding the meeting or adjourned meeting at which the person named in the instrument proposes to vote or, in the case of a poll, at least 24 hours before the time appointed for taking the poll and, in default, the instrument of proxy shall not be treated as valid. 3 Completion of the instrument appointing a proxy does not preclude a member from subsequently attending and voting at the meeting in person if he/she so wishes. 4 In the case of joint holders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and seniority shall be determined by the order in which the names of the Holders stand in the register of members of the Company. 5 As permitted by Regulation 40(1) of the Companies (Uncertificated Securities) (Jersey) Order 1999, only persons entered on the register of members of the Company not later than 48 hours before the time appointed for the meeting are entitled to attend and/or vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries on the register of members after that time will be disregarded in determining the rights of any person to attend and/or vote at the meeting. NOTICE OF ANNUAL GENERAL MEETING Notes: 1. A member of the Company entitled to attend and vote at the above-mentioned meeting is entitled to appoint a proxy to attend and, on a poll, to vote in his/ her place. A proxy may demand, or join in demanding, a poll. A proxy need not be a member of the Company. A member may appoint more than one proxy to attend on the same occasion. 2. The instrument appointing a proxy and the power of attorney or other authority (if any) under which it is signed, or a notarially certified copy of such power or authority, shall be deposited with the Company’s registrars, Computershare Investor Services (Jersey) Limited c/o The Pavilions, Bridgwater Road, Bristol BS99 6ZY, the United Kingdom or at such other place as is specified for that purpose in the notice of the meeting or in the instrument of proxy issued by the Company at least 24 hours before the time appointed for holding the meeting or adjourned meeting at which the person named in the instrument proposes to vote or, in the case of a poll, at least 24 hours before the time appointed for taking the poll and, in default, the instrument of proxy shall not be treated as valid. 3. Completion of the instrument appointing a proxy does not preclude a member from subsequently attending and voting at the meeting in person if he/she so wishes. 4. In the case of joint holders, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders, and seniority shall be determined by the order in which the names of the Holders stand in the register of members of the Company. 5. As permitted by Regulation 40(1) of the Companies (Uncertificated Securities) (Jersey) Order 1999, only persons entered on the register of members of the Company not later than 48 hours before the time appointed for the meeting are entitled to attend and/or vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries on the register of members after that time will be disregarded in determining the rights of any person to attend and/or vote at the meeting. If by an individual: Signed: .................................................................................... Dated: ............................................................................. 2023 If for and on behalf of a corporation: Signed by: ................................................................................. for and on behalf of: ................................................................... Position: .................................................................................... Dated: ............................................................................ 2023 I / We: (full name) ……………………………………………………………………………………………............................................... of: (address) …………………………………………………………………………………………………................................................ being a member of MobilityOne Limited, do hereby appoint: (full name) …………………………………........................................... or failing him: (full name) ……………………………………………………………………………………................................................ or failing him the Chairman of the Meeting as my / our proxy to attend the Annual General Meeting of MobilityOne Limited to be held at Level 2, Wisma LMS, No. 6, Jalan Abd. Rahman Idris, Off Jalan Raja Muda Abdul Aziz, 50300 Kuala Lumpur, Malaysia on 24 July 2023 at 4.00 p.m. Malaysia time or any adjournment thereof. FOR AGAINST WITHHOLD ORDINARY RESOLUTIONS 1. THAT the Company's accounts and reports of the Directors and Auditors for the year ended 31 December 2022 be adopted. 2. THAT Abu Bakar bin Mohd Taib is re-elected as a Director. 3. THAT Gravita Audit Limited be appointed as Auditors of the Company (in accordance with Article 33 of the Articles of Association of the Company) to hold office until the conclusion of the next annual general meeting. 4. THAT the Directors of the Company be authorised to fix the remuneration of Gravita Audit Limited as Auditors of the Company. Please indicate by marking “X” in the respective box. If no indication is given, your proxy will have discretion to vote or to abstain (including on any other matter which may properly come before the meeting as he/she thinks fit). I/We request such proxy to vote as indicted below: No. of Shares: THEN FOLD HERE FIRST FOLD HERE AFFIX STAMP COMPANY'S REGISTRARS MOBILTYONE LIMITED / COMPUTERSHARE INVESTOR SERVICES (JERSEY) LIMITED C/O THE PAVILLIONS BRIDGWATER ROAD BRISTOL BS99 6ZY UNITED KINGDOM FOLD THIS FLAP FOR SEALING REGISTERED OFFICE MobilityOne Limited 13 Castle Street St Helier Jersey JE1 1ES Channels Islands BUSINESS ADDRESS MobilityOne Sdn Bhd 2-3, Incubator 2 Technology Park Malaysia Bukit Jalil 57000 Kuala Lumpur Malaysia Tel: +6(03) 8996 3600 Fax: +6(03) 8996 3601