MOQ LIMITED
AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
INDEX
Page Number
Corporate Directory
Directors’ Report
Statement of Corporate Governance
Consolidated Statement of Profit or Loss and Other Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Financial Statements
Directors’ Declaration
Auditor independence declaration
Independent Auditor’s Report
ASX Additional Information
3
4
19
20
22
23
25
26
55
56
57
62
Page 2 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CORPORATE DIRECTORY
Board of Directors
Mr David Shein
Mr Joe D’Addio
Mr Scott McPherson
Mr Joey Fridman
Mr Michael Pollak
Company Secretary
Brad Cohen
Non Executive Chairman
Executive Director and Chief Executive Officer
Executive Director
Non Executive Director
Non Executive Director
Auditors
Stantons International Audit and Consulting Pty Ltd
Level 2, 22 Pitt Street
Sydney NSW 2000
Solicitors
Thomson Geer
Level 25, 1 O’Connell Street
Sydney NSW 2000
Bankers
Westpac Banking Corporation
94 Church Street
Middle Brighton VIC 3186
St George Bank
Locked Bag 1
Kogarah NSW 1485
Registered Office
Suite 1, Ground Floor
3-5 West Street
North Sydney NSW 2060
Share Registry
Link Market Services Limited
Level 4 Central Park 152 St Georges Terrace
PERTH WA 6000
Investor Enquiries:
Facsimile:
1300 554 474
+61 2 9287 0303
Stock Exchange Listing
Securities of MOQ Limited are listed on the Australian Securities Exchange (ASX).
ASX Code: MOQ
Website
www.MOQ.com.au
Page 3 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT
Your directors present their report on the consolidated entity (referred to herein as the “Group”) consisting of MOQ Limited
(“Company”) and its controlled entities for the financial year ended 30 June 2017. The information in the proceeding op-
erating and financial review forms part of this directors’ report for the financial year ended 30 June 2017 and is to be read in
conjunction with the following information.
General Information
Officers and Directors
The names and particulars of the Directors during or since the end of the financial year are:
Name
Mr David Shein
Mr Joe D’Addio
Mr Scott McPherson
Mr Joey Fridman
Mr Michael Pollak
Mr Don Francis Nanayakkara
Ms Nicola Page
Mr Jonathan Pager
Particulars
Non Executive Chairman
Executive Director and Chief Executive Officer
Executive Director and Solutions Director
Non Executive Director
Non Executive Director
Non Executive Director (resigned 5th July 2017)
Executive Director and Chief Executive Officer (resigned 27th April 2017)
Non Executive Director (resigned 31st July 2017)
The above named Directors held office during and since the financial year, except as otherwise indicated.
Particulars of each director’s experience and qualifications are set out later in this report.
Meetings of Directors
During the financial year, 14 meetings of directors (including committees of directors) were held:
Director
Board Member Since
Eligible Board
Meetings
Attended Eligible Audit
Attended
Mr David Shein
Ms Nicola Page
Mr Joe D’Addio
Mr Scott McPherson
Mr Joey Fridman
Mr Jonathan Pager
Mr Michael Pollak
Mr Don Francis Nanayakkara
17 February 2014
29 May 2015
29 May 2015
29 May 2015
17 February 2014
17 February 2014
17 February 2014
20 May 2016
12
10
12
12
12
12
12
12
12
10
11
11
9
9
11
10
Information Relating to Directors and Company Secretary
David Shein (Non Executive Chairman)
& Risk
Meetings
2
2
2
2
2
2
Exactly 30 years ago, David, having recently migrated from South Africa, founded Com Tech Communications as a
specialist supplier of networking and communications products. 14 years later, Com Tech was sold to Dimension Data
at an enterprise value of over $1billion. At the time of sale, Com Tech employed over 1,400 people, had offices Aus-
tralia wide and achieved revenues of $700 million with no external debt. David prides himself on the recognition Com
Tech achieved being regularly recognised as one of the leading companies to work for in Australia. Since then, David
has been actively involved in mentoring young management teams. David has been an investor and mentor to a number
of start-ups, many of which have been successfully exited. These include Zipmoney, CalReply, Latam Autos,
RangeMe, Pocketbook, Centric Wealth, MacromatiX and Holly Connects. David is also Co Founder of Our Innovation
Fund, a $50million early stage venture capital fund that invests in exciting Australian startups as well as a founding
partner in the Israeli venture capital enterprise, OurCrowd, the first Global Equity Based Crowd Funding Platform.
Page 4 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Interests in shares and options:
Other current directorships:
Former Directorships in last three years:
Special responsibilities:
4,083,335 fully paid ordinary shares
None
None
None
Michael Pollak (Non-Executive Director)
Michael holds a Bachelor of Commerce, is a Chartered Accountant and has an MBA in strategy from the Australian
Graduate School of Management. Michael commenced his career at PricewaterhouseCoopers over 15 years ago. Mi-
chael has gained valuable experience in both Sydney and London in general management, audit, insolvency, corporate
advisory and strategy across a wide range of industries, including financial services, professional services, retail,
mining and manufacturing. Michael has been involved in the restructuring, recapitalisation and relisting of a number of
ASX listed entities.
Interests in shares and options:
2,130,000 fully paid ordinary shares
Other current directorships:
Former Directorships in last three years: UCW Limited (ASX: UCW) (Non-executive director)
None
Special responsibilities:
HJB Corporation Limited (ASX: HJB) (Non-executive director)
Chair of Audit and Risk Committee
Joey Fridman (Non-Executive Director)
Joey is the co-founder and Chief Executive Officer of Monash Private Capital Pty Limited, a Sydney-based inde-
pendent financial services firm investing across various asset classes as principal and through its managed funds. Joey
is a director of various Monash related companies, including Alleasing Group, Wentworth Williamson Fund, Our
Innovation Fund and OurCrowd Australia. Prior to establishing Monash Private Capital, Joey was Chief Financial
Officer of Investec Bank (Australia) Limited, where he also chaired the bank’s Investment Committee, had oversight
for strategy and internal acquisitions, and was involved in a number of its funds management activities. Prior to his role
as CFO, Joey was one of the founding members of the Bank’s investment banking division working across a range of
private equity and corporate clients on mergers, acquisitions, privatisations, capital raisings and strategic advice. Joey
is a Chartered Accountant and has an M.B.A. from the Australian Graduate School of Management.
18,328,334 fully paid ordinary shares
Interests in shares and options:
Other current directorships:
None
Former Directorships in last three years: None
None
Special responsibilities:
Joe D’Addio (Executive Director and Chief Executive Officer)
Joe was a co-founder and Director of Tech Effect. Joe has over 35 years’ experience in the IT industry, with a particular
focus on areas of professional services, system and network engineering and technology consulting. Over the last 20
years, he has held a number of key management and director positions, building and leading businesses in the IT in-
dustry, specifically with Com Tech Communications and Dimension Data.
17,655,978 fully paid ordinary shares
Interests in shares and options:
Other current directorships:
None
Former Directorships in last three years: None
Special responsibilities:
Chief Executive Officer, Member of Audit and Risk Committee
Page 5 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Scott McPherson (Executive Director and Solutions Director)
Scott was a co-founder and Director of Tech Effect. Since forming the company in 2005, Tech Effect grew from
providing Infrastructure related Integration Services, to offering Consulting and Managed Services to assist their clients
to overcome both business and technical ICT related challenges.
Scott’s position draws upon more than two decades of industry experience where he has worked for iconic market
leaders Com Tech Communications and Dimension Data. During this time, Scott has honed his engineering, man-
agement and people skills to create a customer-centric organisation that develops solutions that solve real business
problems. These traits contributed to building Tech Effect into the successful, highly respected organisation.
As the business grow, Scott’s responsibilities evolved to focus on managing the Integration Services Practice, along
with setting the vision and go to market strategy for the ‘Cloud World’. Scott’s technology career started at Queensland
University of Technology where he studied for his Bachelor of Business degree in Information Management.
17,708,478 fully paid ordinary shares
Interests in shares and options:
None
Other current directorships:
Former Directorships in last three years: None
Special responsibilities:
Executive Director
Brad Cohen (Company Secretary) (appointed 7 August 2015)
Brad also acts as the Chief Executive Officer of Skoolbag.
Prior to joining MOQ Limited, Brad worked at OurCrowd LLC where he was an investment professional focusing on
Venture Capital investments. Previously, Brad worked in commercial transaction roles and began his career as a
management consultant at KPMG.
Brad is a qualified Chartered Accountant and holds a Bachelor of Commerce-Accounting and a Bachelor of Laws from
Macquarie University, Sydney.
Page 6 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Principal Activities
The Group’s principal activities were the provision of group ownership, strategy and oversight over a number of
software and service enterprises.
Operating and Financial Review
Whilst FY17 has been a period dominated by a considerable investment and effort to integrate the key acquisitions
made at the end of FY16 – Tetran and Skoolbag – into the MOQ Limited business, the Board is happy to report solid
progress in the following key areas:
1.
2.
3.
4.
Revenue increase of 61% over FY16, noting that over 50% of the additional revenue was achieved from or-
ganic growth in the existing business model. This included:
a.
b.
c.
A successful integration of Tetran into the MOQdigital line of business, featuring:
a.
b.
Recurring Services revenue growth over FY16 of 123% to $10,768,189
Professional Services revenue growth over FY16 of 40% to $15,018,743
Technology Sales revenue growth over FY16 of 58% to $29,082,073
Almost 100% Tetran client retention rate.
Strong leverage back into MOQdigital’s client base, providing an enhanced Managed Services of-
fering, culminating in key new business wins;
Service Management Consolidation and Improvement program, currently 95% completed (target
completion end Q1 FY18), that will allow for improved business processes and scalability of Man-
aged Services business. This program includes the roll out of a new Information Technology Service
Management (ITSM) system; and
Strong key Staff Retention
d.
Management Team Consolidation – The departures of some senior management personnel in FY17 has also
allowed us to streamline our management structure and keep our operational expenses at a level commensurate
with our business model. This was completed in Q4 FY17.
Key personnel additions to the NSW business to enhance Go-To-Market and Service Delivery capability and
capacity, positioning for FY18.
c.
Whilst revenues and market presence grew substantially in FY17, operating performance for the year was impacted by
the significant investment and re-shaping of the merged operations. The following items are of note:
1.
2.
Underlying EBITDA achieved by the Group for FY17 was $1,843,403*
This excluded non-recurring integration and restructuring costs of $1,070,000 consisting of:
a.
$469,000 in implementing the new Service Management System, scheduled to be completed in
Q1FY18, enabling improved business processes and scalability;
$278,000 invested in integration activities, mainly in H1FY17, including marketing, travel and stra-
tegic planning off-sites to bring together the Tetran and MOQdigital teams; and
$323,000 due to restructures to some of the professional services practices, as well as the departures of
some members of the senior management team, who have not been replaced.
b.
c.
FY18 now represents an opportunity for the Company to continue with its strategy to develop, build and acquire
complementary Cloud focused technology businesses to pursue suitable growth opportunities by either organic in-
vestment or through synergistic acquisitions in the technology sector.
With a substantially lower cost base and a focused management team, we are confident that we will deliver our
shareholders the growth fitting of our team, the market opportunity and the companies that we represent in the year
ahead.
*Underlying EBITDA excludes one-off integration/restructuring costs
Page 7 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Priorities for the next 12 months include:
1.
2.
3.
4.
5.
6.
7.
8.
Continue to organically grow the NSW operation through new client acquisition and increasing breadth of sale
to existing clients;
Leverage the FY17 investment in Managed Services business to win new clients and improve delivery effi-
ciency;
Capitalise on our Education market vertical focus and the digital disruption opportunities to introduce new
vendor application partners. (Announcement to be released in due course);
Further leverage the Skoolbag distribution platform (including over 3,200 customer subscriptions and over
1,000,000 end users) to offer the K-12 market access to an enhanced range of services and tools;
Continue to grow in the booming Data Analytics and Business Intelligence market;
Continue to assess acquisition opportunities focused on Recurring Services, SAAS applications and potential
regional expansion into Victoria;
Leverage our strong partnership with Microsoft in the Cloud and Application platforms space, where
Microsoft is growing market share significantly; and
Improve Operating Profit.
Our Business Model and Objectives
The Company’s strategy is to develop, build and acquire complementary Cloud focussed technology businesses. The
Directors of the Company have extensive experience and a proven track record in acquiring and building businesses,
and providing strategic direction, in order to generate long term sustainable returns for shareholders. The Company is
actively pursuing suitable growth opportunities by either organic investment or through synergistic acquisitions in the
technology sector.
Significant Changes in State of Affairs
There are no other significant changes in the state of affairs of the group.
Dividends Paid or Recommended
In respect of the current year, no dividends have been declared or paid and none are recommended (2016: $nil).
Significant Events after the Reporting Period
On 5th July 2017, Don Francis Nanayakkara announced his resignation as a non-executive director from the board of MOQ
Limited.
On 31st July 2017, Jonathan Pager announced his resignation as a non-executive director from the board of MOQ Limited.
Likely developments and expected results
Disclosure of information regarding likely developments in the operations of the Group in future financial years and the
expected results of those operations is likely to result in unreasonable prejudice to the Group. Accordingly, this information
has not been disclosed in this report.
Environmental Issues
There are no applicable environmental regulations that would have an effect on the Company.
Page 8 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Indemnifying Officers or Auditor
During the year, the Company paid a premium to insure officers of the Group. The officers of the Group covered by the
insurance policy include all directors. The liabilities insured are legal costs that may be incurred in defending civil or criminal
proceedings that may be brought against the officers in their capacity as officers of the Group, and any other payments arising
from liabilities incurred by the officers in connection with such proceedings, other than where such liabilities arise out of
conduct involving a wilful breach of duty by the officers or the improper use by the officers of their position or of information
to gain advantage for themselves or someone else to cause detriment to the Group.
Details of the amount of the premium paid in respect of the insurance policies is not disclosed as such disclosure is prohibited
under the terms of the contract.
The Group has not otherwise, during or since the end of the financial year, except to the extent permitted by law, indemnified
or agreed to indemnify any current or former officer or auditor of the Group against a liability incurred as such by an officer
or auditor.
Proceeding on Behalf of Company
During the year, the company instituted legal proceedings against a client to recover outstanding amounts plus interest and
costs as a result of the client terminating their contract with Tetran Pty Ltd. These amounts have been fully provided for in the
accounts.
Auditor
Stantons International Audit and Consulting Pty Limited are the appointed auditors of the Company. The auditor has not been
indemnified under any circumstance.
Non-audit Services
The Board of Directors is satisfied that the provision of non-audit services during the year is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the nature of the
services provided does not compromise the general principles relating to auditor independence in accordance with APES 110:
Code of Ethics for Professional Accountants set by the Accounting Professional and Ethical Standards Board.
The following fees were paid or payable to a company associated with Stantons International for non-audit services provided
to the Company during the year ended 30 June 2017:
Completion Accounts Audit
Total
2017
$
-
-
2016
$
10,000
10,000
The board of directors considers that there was no independence issue in the provision of these services.
Auditor’s Independence Declaration
The lead auditor’s independence declaration for the year ended 30 June 2017 can be found on page 56 of the financial report.
Page 9 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ REPORT (CONT.)
Options
At the date of this report, the unissued ordinary shares of MOQ Limited under option are as follows:
Grant Date
21/11/2012
01/09/2016(1)
TOTAL
Balance at the
date of this report
16,667
3,690,901
3,707,568
Exercise price
Expiry
$7.00
$0.275
12/02/2018
01/09/2020
Option holders do not have any rights to participate in any issues of shares or other interests of the company or any other
entity. For details of options issued to directors and executives as remuneration, refer to the remuneration report.
During the year ended 30 June 2017, the following ordinary shares of MOQ Limited were issued on the exercise of options
granted. No amounts are unpaid on any of the shares.
•
•
6 December 2016: 900,000 options with exercise price $0.10
11 May 2017: 1,600,000 options with exercise price of $0.10
(1)On 1 September 2016, an Employee Option Plan was introduced, which provided certain key management and employees
with 3,690,901 unlisted and unvested options. These options have an exercise price of $0.275 each, vest upon employee
period of service milestones and expire on 1 September 2020.
No person entitled to exercise the option had or has any right by virtue of the option to participate in any share issue of any
other body corporate.
Page 10 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED)
Remuneration Policy
The remuneration policy of MOQ Limited has been designed to align key management personnel (KMP) objectives with
shareholder and business objectives by providing a fixed remuneration component and offering performance incentives based
on key performance areas affecting the consolidated group’s financial results. The Board of MOQ Limited believes the
remuneration policy to be appropriate and effective in its ability to attract and retain high-quality KMP to run and manage the
consolidated group, as well as create goal congruence between directors, executives and shareholders.
The Board’s policy for determining the nature and amount of remuneration for KMP of the consolidated group is to have the
remuneration policy developed by the Board after professional advice is sought where appropriate from independent external
consultants. No external advice was sought for the current financial year.
• All KMP receive a base salary (which is based on factors such as length of service and experience), superan-
•
•
•
nuation, fringe benefits and performance incentives.
Performance incentives are generally only paid once predetermined key performance indicators (KPIs) have
been met.
The Board reviews KMP packages annually by reference to the consolidated group’s performance, executive
performance and comparable information from industry sectors.
Incentives paid in the form of options or rights are intended to align the interests of the KMP and the Group with
those of the shareholders. In this regard, KMP are prohibited from limiting risk attached to those instruments by
use of derivatives or other means. An incentive option plan for KMP was outlined on 24 April 2016.
The performance of KMP is measured against criteria agreed biannually with each executive and is based predominantly on
the forecast growth of the consolidated group’s profits and shareholders’ value. All bonuses and incentives must be linked to
predetermined performance criteria. The Board may, however, exercise its discretion in relation to approving incentives,
bonuses and options.
KMP receive at a minimum, a superannuation guarantee contribution required by the government, which for the year ending
30 June 2017 was 9.50% (2016 : 9.5%) of the individual's average weekly ordinary time earnings. KMP do not receive any
retirement benefits. All remuneration paid to KMP is valued at the cost to the company and expensed.
The Board's policy is to remunerate non-executive directors at market rates for time, commitment and responsibilities. The
Board determines payments to the non-executive directors and reviews their remuneration annually, based on market prac-
tice, duties and accountability. Independent external advice is sought when required. The maximum aggregate amount of fees
that can be paid to non-executive directors is subject to approval by shareholders. Currently, the maximum aggregate re-
muneration of non-executive directors is $500,000.
Performance-based Remuneration:
The KPIs are set annually, in consultation with KMP. The KPIs target areas the Board believes hold greater potential for
group expansion and profit, covering financial and non-financial as well as short and long-term goals. The level set for each
KPI is based on budgeted figures for the Group and respective industry standards.
Performance in relation to the KPIs is assessed annually, with bonuses being awarded depending on the number and deemed
difficulty of the KPIs achieved. Following the assessment, the KPIs are reviewed by the remuneration committee in light of
the desired and actual outcomes, and their efficiency is assessed in relation to the Group’s goals and shareholder wealth,
before the KPIs are set for the following year. In determining whether or not a KPI has been achieved, the Board bases the
assessment on the Company’s performance using audited figures.
Page 11 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED) (CONT.)
Remuneration Expense Details:
The following table of benefits and payments represents the components of the current year and comparative year
remuneration expenses for each member of KMP of the consolidated group:
Short-term
benefits
Salary &
fees
Cash
Bonus
Other
pay-
ments
Post-employm
ent benefits
Superannua-
tion
Share
based
pay-
ments
Personnel
Executive Directors
Ms Nicola Page (resigned
27th April 2017)
Mr Joe D’Addio
Mr Scott McPherson
Mr Don Nanayakkara (re-
signed 5th July 2017)
Non-executive Directors
Mr David Shein
Mr Joey Fridman
Mr Jonathan Pager (re-
signed 31st July 2017)
Mr Michael Pollak
Key Management
Mr Matthew Goggin
(Director Sales)
Mr Mick Badran
(CTO) (resigned 28th Feb-
ruary 2017)
Mr Chad Lurie (GM Ser-
vices)
Mr (Danny) Wan Yee Loh
(GM Finance)
2017 Total
2016 Total
Year
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
2017
2016
262,797
200,000
200,000
200,000
233,000
200,000
321,256
9,518
56,530
54,795
60,000
60,000
60,000
60,000
54,795
54,795
233,000
200,000
2017
151,010
2016
2017
2016
2017
2016
200,000
200,000
9,589
184,000
109,154
2,016,388
1,357,851
Total
282,413
219,000
219,000
219,000
252,616
219,000
343,000
10,422
60,000
60,000
60,000
60,000
75,000
60,000
75,000
60,000
252,616
219,000
19,616
19,000
19,000
19,000
19,616
19,000
21,744
904
3,470
5,205
-
-
-
-
5,205
5,205
19,616
19,000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
12,667
-
163,677
19,000
19,000
911
17,480
10,370
157,414
-
-
-
6,599
-
219,000
219,000
10,500
208,079
119,524
6,599 2,210,401
-
117,595
- 1,475,446
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
15,000(1)
-
-
-
- 15,000(1)
-
-
-
-
-
-
-
-
-
-
30,000
-
-
-
-
-
-
-
-
-
-
Perfor-
mance
based per-
centage of
remunera-
tion
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
3%
-
-
-
(1) Other payments were fees for corporate advisory work undertaken.
Page 12 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED) (CONT.)
The relative proportions of remuneration that are linked to performance and those that are fixed are as follows:
Personnel
Fixed Remuneration
At Risk – Short Term In-
centives
At Risk - Options
Executive Directors
Mr Joe D’Addio
Mr Scott McPherson
Other Key Management Personnel
Mr Matthew Goggin
Mr Chad Lurie
Mr (Danny) Wan Yee Loh
100%
87%
87%
100%
97%
Service agreements (audited):
-
13%
13%
-
-
-
-
-
-
3%
The directors serve until they resign, are removed, cease to be a director or are prohibited from being a director under the
provisions of the Corporations Act 2001, or are not re-elected to office.
The directors entered into service agreements on the following terms:
• Mr Shein, Mr Fridman, Mr Pager and Mr Pollak - Base salary (including director’s fees) of $60,000 per annum
(including superannuation or similar contributions).
• Ms Page (resigned 27th April 2017), Mr D’Addio and Mr McPherson - Base salary (including director’s fees) of
$200,000 per annum (plus superannuation or similar contributions).
o
o Annual incentive payment of up to $81,217 each based on pre-determined key metrics.
o The Company may also, in its absolute discretion, provide a bonus, the value of which, the conditions
attached to and the frequency of such a bonus, remain matters over which the Company exercises sole
discretion.
If the Company terminates the agreement with reason (such as gross misconduct, conviction of a
major criminal offence or misuse of price sensitive information), the Company will provide the Di-
rector with no notice and will be summarily dismissed. If the Company terminates the agreement
without reason (notwithstanding any other provision of the agreement), the Company will provide the
Director with 3 months’ written notice or make a payment of 3 months’ salary in lieu of the notice
period.
o The Director may terminate the agreement at his or her sole discretion and at any time, and in doing so
is entitled to payment of a fee equivalent to 3 months of their base fees.
o After the termination of their employment with the Company and MOQdigital, the Director will be
subject to a contractual restraint which may apply for up to 3 years after 29 May 2015 or 6 months
after the termination (whichever is greater), and cover up to all of Australia.
• Mr Nanayakkara (resigned 5th July 2017) – Base salary of $200,000 per annum.
o
o Annual incentive payment of up to $81,217 based on pre-determined key metrics.
o The Company may also, in its absolute discretion, provide a bonus, the value of which, the conditions
attached to and the frequency of such a bonus, remain matters over which the Company exercises sole
discretion.
If the Company terminates the agreement with reason (such as gross misconduct, conviction of a
major criminal offence or misuse of price sensitive information), the Company will provide the Di-
rector with no notice and will be summarily dismissed. If the Company terminates the agreement
without reason (notwithstanding any other provision of the agreement) within 12 months of com-
mencement, the Company will provide the Director with 6 months’ written notice, and thereafter with
2 months’ written notice.
Key Management Personnel entered into service agreements on the following terms:
• Mr Badran (resigned 28th February 2017) and Mr Goggin - Base salary of $200,000 per annum (plus superannua-
tion or similar contributions).
Page 13 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
• Mr Loh -Base salary of $196,000 per annum (plus superannuation or similar contributions).
o
o The Company may also, in its absolute discretion, provide a bonus, the value of which, the conditions
attached to and the frequency of such a bonus, remain matters over which the Company exercises sole
discretion.
If the Company terminates the agreement with reason (such as gross misconduct, conviction of a
major criminal offence or misuse of price sensitive information), the Company will provide the KMP
with no notice and will be summarily dismissed. If the Company terminates the agreement without
reason (notwithstanding any other provision of the agreement), the Company will provide the KMP
with up to 3 months’ written notice or make a payment of up to 3 months’ salary in lieu of the notice
period.
o The KMP may terminate the agreement at his or her sole discretion and at any time, and in doing so is
entitled to payment of a fee equivalent to 3 months of their base fees.
o After the termination of their employment with the Company and MOQdigital, the KMP will be
subject to a contractual restraint which may apply for up to 3 years after 29 May 2015 or 6 months
after the termination (whichever is greater), and cover up to all of Australia.
•
Mr Lurie – Base salary of $200,000 per annum (plus superannuation or similar contributions).
o
o The Company may also, in its absolute discretion, provide a bonus, the value of which, the conditions
attached to and the frequency of such a bonus, remain matters over which the Company exercises sole
discretion.
If the Company terminates the agreement with reason (such as gross misconduct, conviction of a
major criminal offence or misuse of price sensitive information), the Company will provide the Di-
rector with no notice and will be summarily dismissed. If the Company terminates the agreement
without reason (notwithstanding any other provision of the agreement) within 12 months of com-
mencement, the Company will provide the Director with 6 months’ written notice, and thereafter with
2 months’ written notice.
Page 14 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
Shareholding and option holding of directors and other key management personnel (audited)
Options held by Directors and Key Management Personnel
The number of options in the Company during the 2017 reporting period held by each of the Group’s Directors and Key
Management Personnel, including their related parties, is set out below:
Personnel
Ms Nicola Page
Mr Joe D’Addio
Mr Scott McPherson
Mr Don Francis Nanayakkara
Mr David Shein
Mr Joey Fridman
Mr Jonathan Pager
Mr Michael Pollak
Mr Matthew Goggin
Mr Mick Badran
Mr Chad Lurie
Mr Danny Loh
Balance at
the start of
the year
-
-
-
-
-
-
250,000
900,000
-
-
-
-
Year ended 30 June 2017
Options
acquired
Received as part of
remuneration
Options exercised /
disposed
Held at the end of
the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
181,818
-
-
-
-
-
-
(250,000)
(900,000)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
181,818
Personnel
Ms Nicola Page
Mr Joe D’Addio
Mr Scott McPherson
Mr David Shein
Mr Joey Fridman
Mr Jonathan Pager
Mr Michael Pollak
Mr Matthew Goggin
Mr Mick Badran
Balance at the
start of the year
-
-
-
-
-
2,500,000
9,000,000
-
-
Options
acquired
-
-
-
-
-
-
-
-
-
(1)A 10:1 Consolidation of shares occurred on the 31 May 2016.
Options exercised /
disposed(1)
Year ended 30 June 2016
Received as part
of remuneration
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(2,250,000)
(8,100,000)
-
-
Held at the end of
the year
-
-
-
-
-
250,000
900,000
-
-
Page 15 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED) (CONT.)
Name
Grant Date
Held at
1 July
2016
Granted as
remuneration
Net
change
other
Wan Yee
(Danny)
Loh
05-September-2016
05-September-2016
-
-
90,909
90,909
-
-
Held at
30
June
2017
90,909
90,909
Vested
during
the year
and as at
30 June
2017
Total
unvested
at 30
June
2017
Vesting Date
Expiry Date
Value per
option at
grant date
Total value of
options at
grant date
Exercise
price
per
option
-
-
90,909 01-September-2018 01-September-2020
$0.1045
$9,500.00
$0.275
90,909 01-September-2019 01-September-2020
$0.1045
$9,500.00
$0.275
*No other Key Management Personnel were granted remuneration options during the year.
Page 16 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED) (CONT.)
Shares held by Directors and Key Management Personnel
The number of ordinary shares in the Company during the 2017 reporting period held by each of the Group’s Key Man-
agement Personnel, including their related parties, is set out below:
Personnel
Ms Nicola Page(1)
Mr Joe D’Addio
Mr Scott McPherson
Mr David Shein
Mr Don Francis Nanayakkara(1)
Mr Joey Fridman
Mr Jonathan Pager(1)
Mr Michael Pollak
Mr Matthew Goggin
Mr Mick Badran(1)
Mr Chad Lurie
Mr Danny Loh
Balance at
the start of
the year
7,083,335
17,655,978
17,655,978
4,083,335
5,696,262
18,328,334
745,000
1,980,000
8,827,989
7,083,335
3,539,028
-
Received as
part of re-
muneration
-
-
-
-
-
-
-
-
-
-
-
-
(1)Number of shares as reported on final director’s interest notice.
Year ended 30 June 2017
Acquired
Other
changes
Disposal Held at the end
of reporting
period
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(750,000)
-
(293,886)
-
-
52,500
906,572
250,000
900,000
571,429
-
7,083,335
17,655,978
17,708,478
4,083,335
6,602,834
18,328,334
995,000
2,130,000
8,827,989
6,789,449
4,110,457
-
Personnel
Ms Nicola Page
Mr Joe D’Addio
Mr Scott McPherson
Mr David Shein
Mr Don Francis Nanayakkara(2)
Mr Joey Fridman
Mr Jonathan Pager
Mr Michael Pollak
Mr Matthew Goggin
Mr Mick Badran
Mr Chad Lurie(3)
Mr Danny Loh
Balance at
the start of
the year
70,833,334
176,559,780
176,559,780
40,833,334
-
182,283,334
7,450,000
19,800,000
88,279,890
70,833,334
-
-
Year ended 30 June 2016
Acquired(1)
Other
changes(2)
Disposal Held at the end
of reporting
period
Received as
part of
remunera-
tion
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
56,962,210
-
-
-
-
-
35,390,272
-
(63,749,999)
(158,903,802)
(158,903,802)
(36,749,999)
(51,265,948)
(163,955,000)
(6,705,000)
(17,820,000)
(79,451,901)
(63,749,999)
(31,851,244)
-
-
-
-
-
-
-
-
-
-
-
-
-
7,083,335
17,655,978
17,655,978
4,083,335
5,696,262
18,328,334
745,000
1,980,000
8,827,989
7,083,335
3,539,028
-
(1)A 10:1 Consolidation of shares occurred on the 31 May 2016.
(2) Shares issued as consideration as part of the acquisition of TETRAN group.
(3) Mr Chad Lurie’s shares were incorrectly stated in the prior year audited accounts, and has been corrected in the 2016 table.
Other Equity-related KMP Transactions
On the 22nd December 2016, shares were issued to the vendors of Tetran which were related to achievement of certain per-
formance conditions as part of the purchase. These shares were issued to KMPs, and have been reflected in the tables above
where applicable.
Loans to KMP
No loans have been made to KMP during, or since, the year ended 30 June 2017 (2016:$Nil).
Page 17 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
REMUNERATION REPORT (AUDITED) (CONT.)
Other transactions with KMP or their related parties
No related party transactions included.
This directors’ report, incorporating the remuneration report, is signed in accordance with a resolution of the Board of Di-
rectors.
David Shein
Non-Executive Chairman
28 September 2017
Page 18 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
STATEMENT OF CORPORATE GOVERNANCE
The Board is committed to achieving and demonstrating the highest standards of corporate governance. As such, MOQ
Limited and its Group have adopted the third edition of the Corporate Governance Principles and Recommendations which
was released by the ASX Corporate Governance Council on 27 March 2014 and became effective for financial years be-
ginning on or after 1 July 2014.
The Group’s current Corporate Governance Statement for this reporting period is available on MOQ Limited’s website at
www.moq.com.au/corporate-governance/
Page 19 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Notes
2017
$
2016
$
Revenue
Revenue
Other income
Total Revenue
Cost of sales
Gross Profit
Expenses
Share based payments
Depreciation & amortisation expenses
Employee costs
Legal costs
ASX and registry related expenses
Marketing expense
Occupancy expenses
Professional fees
Telecommunication carrier expenses
Other expenses
Total expenses
Profit / (Loss) before impairment
Profit / (Loss) before income tax expense
Income tax (expense) / credit
Profit / (Loss) after income tax
6
6
7
7
7
7
7
8
54,869,005
149,973
55,018,978
33,934,350
222,646
34,156,996
(43,344,464)
(27,971,377)
11,674,514
6,185,619
(111,630)
(519,007)
(7,303,695)
(128,949)
(65,979)
(490,113)
(861,191)
(303,434)
(375,366)
(1,260,754)
-
(110,009)
(4,414,010)
(33,978)
(80,219)
(308,205)
(520,778)
(337,317)
(141,439)
(902,417)
(11,420,118)
(6,848,372)
254,396
(662,753)
254,396
(153,420)
100,976
(662,753)
128,149
(534,604)
Other comprehensive (loss) for the year
Exchange differences on translating foreign subsidiaries
Total comprehensive (loss) for the year
(140,860)
(39,884)
(6,198)
(540,802)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
Page 20 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2017
Profit / (Loss) is attributable to
MOQ Limited
Total comprehensive (loss) is attributable to
MOQ Limited
Notes
2017
$
100,976
100,976
(39,884)
(39,884)
2016
$
(534,604)
(534,604)
(540,802)
(540,802)
Earnings / (Loss) per share attributable to equity holders of
the parent entity
Basic (loss) / earnings per share (cents per share)
Diluted (loss) / earnings per share (cents per share)
28
28
0.06
0.06
(0.05)
(0.05)
The above consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the
accompanying notes.
Page 21 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2017
Current Assets
Cash and cash equivalents
Trade and other receivables
Work In Progress
Other assets
Non Current Assets
Other Assets
Deferred tax assets
Property plant and equipment
Intangibles
Total assets
Current Liabilities
Trade and other payables
Deferred revenue
Provisions
Non - Current Liabilities
Provisions
Total Liabilities
Net Assets
Equity
Issued capital
Reserves
Accumulated losses
Total Equity
Notes
9
10
11
12
12
13
14
15
16
17
18
18
19
20
21
2017
$
3,265,859
8,172,252
309,578
648,499
12,396,188
377,460
687,884
525,536
14,142,826
15,733,706
2016
$
3,078,326
6,298,691
220,676
273,602
9,871,295
187,540
723,847
452,350
14,455,829
15,819,566
28,129,894
25,690,861
7,361,808
1,712,654
1,413,944
10,488,406
5,018,996
2,029,235
1,352,621
8,400,852
77,782
48,049
10,566,188
8,448,901
17,563,706
17,241,960
49,615,752
(26,763)
(32,025,283)
17,563,706
49,365,752
2,467
(32,126,259)
17,241,960
The above consolidated statement of financial position should be read in conjunction with the accompanying notes.
Page 22 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2017
Issued Capital
Reserves
Accumulated Losses
Total Equity
$
$
$
$
Balance as at 1 July 2016
49,365,752
2,467
(32,126,259)
17,241,960
Net profit for the year
Other comprehensive loss
Total comprehensive income / (loss)
for the year
Transactions with owners in their
capacity as owners
Issue of share capital
Option Premium Reserve
Capital raising costs
-
-
-
-
250,000
-
-
-
(140,860)
(140,860)
-
-
111,630
-
100,976
-
100,976
-
-
-
-
100,976
(140,860)
(39,884)
-
250,000
111,630
-
Balance as at 30 June 2017
49,615,752
(26,763)
(32,025,283)
17,563,706
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Page 23 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2016
Issued Capital
$
Shares to be
Issued
$
Reserves
$
Accumulated
Losses
$
Total Equity
$
Balance as at 1 July 2015
33,285,143
8,333
8,665
(31,591,655)
Net loss for the year
Other comprehensive loss for the year
Total comprehensive loss for the year
Transactions with owners in their capacity as
owners
Issue of share capital
Shares to be issued
Option Premium Reserve
Capital raising costs
Balance as at 30 June 2016
-
-
-
14,013,133
2,500,000
-
(432,524)
49,365,752
-
-
-
(8,333)
-
-
-
The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
-
(6,198)
(6,198)
-
-
-
-
(534,604)
-
1,710,486
(534,604)
(6,198)
(534,604)
(540,802)
-
-
-
14,013,133
2,491,667
-
(432,524)
2,467
(32,126,259)
17,241,960
Page 24 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2017
Notes
2017
$
2016
$
Cash flow from operating activities
Receipts from customers
Payments to suppliers and employees
Interest received
Income taxes received
Net cash provided by / (used in) operating activities
30
57,736,151
(56,682,702)
15,683
(202,909)
866,223
36,601,890
(38,186,980)
7,055
(52,676)
(1,630,711)
Cash flow from investing activities
Payment for property plant and equipment
Payment for deposits
Cash on acquisition of controlled entities
Acquisition of subsidiaries
Net cash (used in) investing activities
Cash flow from financing activities
Proceeds from issue of shares
Share issued costs
Net cash provided by financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
(336,465)
(187,631)
-
(404,594)
(928,690)
250,000
-
250,000
187,533
3,078,326
3,265,859
(345,261)
(176,093)
925,816
(6,990,000)
(6,585,538)
8,575,000
(2,724)
8,572,276
356,027
2,722,299
3,078,326
The above consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Page 25 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The consolidated financial statements cover MOQ Limited (“Company or “parent entity”) and its controlled entity as a
consolidated entity (also referred to as “the Group”). MOQ Limited is a company limited by shares, incorporated and
domiciled in Australia. The Group is a for-profit entity and is primarily involved in the information technology industry
being the field of software and services.
The separate financial statements of the parent entity, MOQ Limited, have not been presented within this financial report as
permitted by the Corporations Act 2001.
The consolidated financial statements were authorised for issue by the Board of Directors on 28 September 2017.
The following is a summary of the material accounting policies adopted by the consolidated entity in the preparation and
presentation of the financial report. The accounting policies have been consistently applied, unless otherwise stated.
(a)
Basis of preparation of the financial report
Statement of Compliance
These financial statements are general purpose financial statements which have been prepared in accordance with the
Corporations Act 2001, Accounting Standards and Interpretations, and comply with other requirements of the law where
possible.
Accounting Standards include Australian Accounting Standards. Compliance with Australian Accounting Standards en-
sures that the financial statements and notes of the Company comply with International Financial Reporting Standards
(‘IFRS’). It is recommended that this financial report be read in conjunction with the public announcements made by MOQ
Limited during the year in accordance with the continuous disclosure requirements arising under the Corporations Act
2001.
The financial report has been prepared on the historical cost basis.
When required by accounting standards, comparative figures have been adjusted to conform to changes in presentation for
the current year. When the Company applies an accounting policy retrospectively, makes a retrospective restatement or
reclassifies items in its financial statements, a statement of financial position as at the beginning of the earliest comparative
period will be disclosed.
(b)
Business combinations
Business combinations occur where an acquirer obtains control over one or more businesses.
A business combination is accounted for by applying the acquisition method, unless it is a combination involving entities or
businesses under common control. The business combination will be accounted for from the date that control is attained,
whereby the fair value of the identifiable assets acquired and liabilities (including contingent liabilities) assumed is rec-
ognised (subject to certain limited exemptions).
When measuring the consideration transferred in the business combination, any asset or liability resulting from a contingent
consideration arrangement is also included. Subsequent to initial recognition, contingent consideration classified as equity is
not remeasured and its subsequent settlement is accounted for within equity. Contingent consideration classified as an asset or
liability is remeasured in each reporting period to fair value, recognising any change to fair value in profit or loss, unless the
change in value can be identified as existing at acquisition date.
All transaction costs incurred in relation to business combinations, other than those associated with the issue of a financial
instrument, are recognised as expenses in profit or loss when incurred.
Page 26 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase.
(c)
Goodwill
Goodwill is carried at cost less any accumulated impairment losses. Goodwill is calculated as the excess of the sum of:
-
-
-
the consideration transferred;
any non-controlling interest (determined under either the full goodwill or proportionate interest method); and
the acquisition date fair value of any previously held equity interest over the acquisition date fair value of net
identifiable assets acquired.
The acquisition date fair value of the consideration transferred for a business combination plus the acquisition date fair value
of any previously held equity interest shall form the cost of the investment in the separate financial statements.
Fair value re-measurements in any pre-existing equity holdings are recognised in profit or loss in the period in which they
arise. Where changes in the value of such equity holdings had previously been recognised in other comprehensive income,
such amounts are recycled to profit or loss.
Goodwill on acquisition of subsidiaries is included in intangible assets.
Goodwill is tested for impairment annually and is allocated to the Group’s cash-generating units or groups of cash-generating
units, representing the lowest level at which goodwill is monitored being not larger than an operating segment. Determining
whether goodwill is impaired requires an estimation of the value in use of the cash –generating units to which goodwill has
been allocated. The value in use calculation requires the directors to estimate the future cash flows expected to arise from the
cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash flows are
less than expected, a material impairment loss may arise.
(d)
Critical accounting estimates
The preparation of the financial statements in conformity with IFRS requires the use of accounting estimates. It also requires
management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving
higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial state-
ments are disclosed in Note 2.
(e)
Principles of consolidation
The consolidated financial statements incorporate all of the assets, liabilities and results of the parent (MOQ Limited) and all
of the subsidiaries. Subsidiaries are entities that the parent controls. The parent controls an entity when it is exposed to, or has
rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over
the entity. A list of the subsidiaries is provided in Note 32.
The assets, liabilities and results of all subsidiaries are fully consolidated into the financial statements of the Group from the
date on which control is obtained by the Group. The consolidation of a subsidiary is discontinued from the date that control
ceases. Intercompany transactions, balances and unrealised gains or losses on transactions between Group entities are fully
eliminated on consolidation. Accounting policies of subsidiaries have been changed and adjustments made where necessary
to ensure uniformity of the accounting policies adopted by the Group.
(f)
Fair Value of Assets and Liabilities
The Group measures some of its assets and liabilities at fair value on either a recurring or non-recurring basis, depending on
the requirements of the applicable Accounting Standard. Fair value is the price the Group would receive to sell an asset or
Page 27 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
would have to pay to transfer a liability in an orderly (i.e. unforced) transaction between independent, knowledgeable and
willing market participants at the measurement date.
As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine
fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability.
The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation
techniques. These valuation techniques maximise, to the extent possible, the use of observable market data.
To the extent possible, market information is extracted from either the principal market for the asset or liability (i.e. the
market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a market, the most
advantageous market available to the entity at the end of the reporting period (i.e. the market that maximises the receipts from
the sale of the asset or minimises the payments made to transfer the liability, after taking into account transaction costs and
transport costs).
For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use the asset in its
highest and best use or to sell it to another market participant that would use the asset in its highest and best use.
These valuation techniques maximise, to the extent possible, the use of observable market data. If all significant inputs re-
quired to measure fair value are observable, the asset or liability is included in Level 2. If one or more significant inputs are
not based on observable market data, the asset or liability is included in Level 3.
The Group would change the categorisation within the fair value hierarchy only in the following circumstances:
-
-
if a market that was previously considered active (Level 1) became inactive (Level 2 or Level 3) or vice versa;
if significant inputs that were previously unobservable (Level 3) became observable (Level 2) or vice versa.
When a change in the categorisation occurs, the Group recognises transfers between levels of the fair value hierarchy (i.e.
transfers into and out of each level of the fair value hierarchy) on the date the event or change in circumstances occurred.
(g)
Income tax
The income tax expense/(income) for the year comprises current income tax expense/(income) and deferred tax ex-
pense/(income).
Current income tax expense or revenue for the year is the tax payable on the current period’s taxable income based on the
notional income tax rate adjusted by changes in deferred tax assets and liabilities attributable to temporary differences and to
unused tax losses.
Deferred income tax is provided using the liability method on temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the consolidated financial statements. Deferred income tax is determined using
tax rates that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related
deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future
taxable amounts will be available to utilise those temporary differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of
investments in controlled entities where the parent entity is able to control the timing of the reversal of the temporary dif-
ferences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities offset when there is a legally enforceable right to offset current tax assets and liabilities and
when the deferred tax balances relate to the same taxation authority. Current tax asset and tax liabilities are offset where the
Page 28 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
entity has a legally enforceable right to offset and intends to settle on a net basis, or to realise the asset and settle the liability
simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in equity are also recognised directly in equity.
(h)
Tax Consolidation Legislation
The Company and its Australian wholly owned subsidiaries have formed an income tax consolidated group under the tax
consolidation legislation for the whole of the financial year. Each entity in the Group recognises its own current and deferred
tax liabilities, except for any deferred tax liabilities resulting from unused tax losses and tax credits, which are immediately
assumed by the parent entity. The Group notified the Australian tax Office it had formed an income tax consolidated group to
apply from 1 June 2015. The tax consolidated group has entered a tax sharing agreement whereby each company in the Group
contributes to the income tax payable in proportion to their contribution to the net profit before tax of the tax consolidated
group.
(i)
Plant and equipment
Each class of plant and equipment is carried at cost less any applicable accumulated depreciation and any accumulated im-
pairment losses. Plant and equipment is measured on the cost basis. The carrying amount of plant and equipment is reviewed
annually by directors to ensure it is not in excess of the recoverable amount from those assets.
The recoverable amount is assessed on the basis of the expected net cash flows which will be received from the assets em-
ployment and subsequent disposal. The expected net cash flows have been discounted to present values in determining re-
coverable amounts.
The depreciated amount of all fixed assets including capitalised leased assets is depreciated on a straight line basis over their
useful lives commencing from the time the asset is held ready for use.
The expected useful life of plant and equipment ranges from 3 to 15 years.
The assets’ residual values and useful life are reviewed at the balances date. The asset’s carrying amount is written down
immediately to its recoverable amount if the asset’s carrying amount is greater that its estimated recoverable amount.
Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful
lives of the improvements.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These are included net in
profit or loss.
Depreciation
The depreciable amount of all fixed assets including buildings and capitalised lease assets, but excluding freehold land, is
depreciated on a straight-line basis over the asset’s useful life to the consolidated group commencing from the time the asset
is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or
the estimated useful lives of the improvements.
The depreciation rates used for each class of depreciable assets are:
Class of Fixed Asset
Leasehold improvements
Plant and Equipment
Depreciation Rate
Term of lease
6.67 – 33.33%
Page 29 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater
than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are
recognised in profit or loss in the period in which they arise. When revalued assets are sold, amounts included in the reval-
uation surplus relating to that asset are transferred to accumulated losses.
(j)
Leases
At inception of an arrangement, the Group determines whether such an arrangement is, or contains, a lease. A specific asset is
the subject of a lease if fulfilment of the arrangement is dependent on the use of that specified asset. An arrangement conveys
the right to use the asset if the arrangement conveys to the Group the right to control the use of the underlying asset. At
inception, or upon reassessment of the arrangement, the Group separates payments and other consideration required by such
an arrangement into those for the lease and those for other elements on the basis of their relative fair values.
Leases reclassified at their inception as either operating or finance leases based on the economic substance of the arrangement
so as to reflect the risks and benefits incidental to ownership.
Lease of fixed assets where substantially all the risks and rewards incidental to the ownership of the asset, but not the legal
ownership, are transferred to the entity are classified as finance leases. Finance lease are capitalised by recording an asset and
a liability equal to the fair value of the leased property or the present value of the minimum lease payments including any
guaranteed residual values. The interest expense is calculated using the interest rate implicit in the lease and is included in
finance costs in the Statement of Profit or Loss and Other Comprehensive Income. Lease assets are depreciated on a straight
line basis over their estimated useful lives where it is likely that the entity will obtain ownership of the asset or over the term
of the lease. Lease payments are allocated between the reduction of the lease liability and the lease interest expense for the
year.
Lease payments for operating leases where substantially all the risks and benefits remain with the lessor are recognised as an
expense in the year in which they are incurred. Lease incentives received under operating leases are recognised as a liability
and amortised on a straight line basis over the life of the lease term.
(k)
Financial instruments
The Group initially recognises financial assets on the trade date at which the Group becomes a party to a contractual provision
of the instrument.
Financial assets are initially measured at cost. If the financial asset is not subsequently measured at fair value through profit or
less, the initial measurement includes transaction costs that are directly attributed to the asset’s acquisition. The Group
subsequently measures financial assets at either amortised costs or fair value.
A financial asset is subsequently measured at amortised cost using the effective interest method and net of any impairment
loss, if:
-
-
The asset is held with an objective to collect cash flows; and
The contractual terms give rise to cash flows that are solely payments of principal and interest.
Financial assets other than those classified as financial assets measured at amortised costs are subsequently measured at fair
value with all changes in fair value recognised in profit or loss.
Page 30 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
All financial liabilities are recognised initially on the trade date at which the Group becomes a party to the contractual pro-
visions of the instrument. Non derivative financial liabilities are recognised at amortised cost, comprising original debt less
principal payment and amortisation.
The Group derecognises a financial liability when its contractual obligations are discharged, cancelled or expire. Financial
assets and financial liabilities are offset when the Group has a legal right to offset the amounts and intends either to settle on
a net basis or to realise the assets and settle the liability simultaneously.
(l)
Impairment of financial assets
A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is
any objective evidence that it is impaired. A financial asset is considered to be impaired if objective evidence indicates that
one or more events have occurred after the initial recognition of the asset and that the loss event has a negative effect on the
estimated future cash flows of that assets which can be estimated reliably.
The Group considers evidence of impairment for receivables at both a specific and collective level. All individually signif-
icant receivables found not to be specifically impaired are then collectively assessed for any impairment that has been in-
curred but not yet identified.
(m)
Impairment of non-financial assets
Intangible assets are tested annually for impairment or more frequently if changes in circumstances indicate that they might
be impaired.
At each reporting date the Group assesses whether there is any indication that individual assets are impaired. Where im-
pairment indicators exist, recoverable amount is determined and impairment losses are recognised in profit or loss where the
asset’s carrying value exceeds its recoverable amount. Recoverable amount is the higher of an asset’s fair value less costs to
sell and value in use.
For the purpose of assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current marked assessment of the time value of money and the risks specific to the asset.
(n)
Intangible assets
Customer contracts acquired as part of a business combination are recognised separately from goodwill. The customer con-
tracts are carried at fair value at the date of acquisition less accumulated amortisation and impairment losses. Fair value is
assessed based on the income streams generated from customer contracts after allowing for cost specific to the generation of
those income streams. In the assessment of the carrying value of the intangible assets costs not related to the generation of the
contract related income streams were excluded. These intangibles are separate from the business to which they relate and
have been assessed on this basis. Amortisation is calculated based on the timing of projected cash flows of the contracts over
their estimated useful lives, which at present are 1.5 years to 8 years.
Software acquired as part of a business combination is recognised separately from goodwill. The software is carried at fair
value at the date of acquisition less accumulated amortisation and impairment losses. Amortisation is calculated based on the
timing of projected cash flows of the contracts over their estimated useful lives, which at present are 4 years.
(o)
Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share
options are recognised as a deduction from equity, net of any tax.
If the entity reacquires its own equity instruments, those instruments are deducted from equity and the associated shares are
cancelled. No gain or loss is recognised in the profit or loss and the consideration paid including any directly attributable costs
net of any taxes is recognised directly in equity.
Page 31 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
(p)
Foreign currency transactions and balances
The functional currency of each entity in the consolidated entity is measured using the currency of the primary economic
environment in which that consolidated entity operates. The consolidated financial statements are presented in Australian
dollars which is the consolidated entity’s functional and presentation currency.
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the
transaction. Foreign currency monetary items are translated using the spot rate at the end of the financial year. Non monetary
items measured at historical cost continue to be carried at the date of the transaction. Non monetary items measured at fair
value are reported at the exchange rate at the date when the fair values were determined. Material exchange differences
arising on the translation of monetary items are recognised in profit or loss except where deferred in equity as a qualifying
cash flow or net investment hedge. Material exchange differences arising on the translation of non monetary items are rec-
ognised inequity to the extent that the gain or loss is directly recognised in equity otherwise the exchange is recognised in
profit or loss.
(q)
Employee benefits
Wages and salaries, annual leave and sick leave
Liabilities for wages and salaries, and annual leave, including non monetary benefits, expected to be settled within 12 months
of the reporting date are recognised in other payables, in respect of employees’ services up to the reporting date and are
measured at the amounts expected to be paid when the liabilities are settled, on an undiscounted basis.
Liabilities for non accumulating sick leave are recognised when the leave is taken and measure at the rates paid or payable.
Long service leave
The liability for long service leave and annual leave which is not expected to be settled within 12 months of the reporting date
are recognised in the provision for employee benefits and measured as the present value of expected future payments to be
made for services provided by employees up to the reporting date.
Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service.
Expected future payments are discounted using market yields at the reporting date on national government bonds with terms
to maturity and currency that match as closely as possible the estimated future cash outflows.
Termination benefits
Termination benefits are payable when employments are terminated before the normal retirement date, or when the employee
accepts voluntary redundancy in exchange for these benefits.
The Group recognises termination benefits when it is demonstrably committed to either terminating the employment of
current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as
a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after reporting date
are discounted to present value.
Page 32 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
(r)
Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present
obligation at the Statement of Financial Position date. The discount rate used to determine the present value reflects current
market assessments of the time value of money and the risks specific to the liability.
(s)
Cash and cash equivalents
Cash and cash equivalents include cash on hand and at banks, deposits held on call with banks, other short term highly liquid
investments with an original maturity date of three months or less held and bank overdrafts. Bank overdrafts are shown within
borrowings in current liabilities in Statement of Financial Position.
(t)
Revenue
Revenue is measured at the fair value of the consideration received or receivable.
Revenue for recurring services is recognised in equal amounts over the period for which service or support is to be provided
to a customer, either quarterly or annually.
Revenue from technology sales in recognised upon delivery of the product to the customer.
Revenue from professional services is recognised in the accounting period in which the services are rendered. For time and
materials contracts, revenue is recognised as the service is rendered.
Interest revenue is recognised as interest accrues using the effective interest method. The effective interest method uses the
effective interest rate which is the rate that exactly discounts the estimated future cash receipts over the expected life of the
financial asset.
Revenue from other services is recognised upon the delivery of the service to the customers.
All revenue is stated net of the amount of goods and services tax (GST).
(u)
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial
period of time to prepare for their intended use or sale are added to the cost of those assets, until such time as the assets are
substantially ready for their intended use or sale. All other borrowing costs are recognised in profit or loss in the period in
which they are incurred.
Page 33 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
(v)
Earnings per share
Basic earnings per share
Basic earnings per share is calculated by dividing the profit or loss attributable to ordinary shareholders of the Group by the
weighted average number of ordinary shares outstanding during the year, adjusted for bonus elements in ordinary shares
issued during the year.
Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the
after income tax effect of interest and other financing costs associated with dilutive potential ordinary shares and the weighted
average number of shares assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
Potential ordinary shares are anti-dilutive when their conversion to ordinary shares would increase earnings per share or
decrease loss per share from continuing operations.
(w)
Trade and other receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective in-
terest method, less provision for impairment.
Collectability of receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off by
reducing the carrying amount directly. An allowance account (provision for impairment of trade receivables) is used 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. Refer to Note 1(l) for further discussion on determination of impairment losses.
The amount of the impairment loss is recognised in profit or loss within other expenses. When a trade receivable for which an
impairment allowance had been recognised becomes uncollectable in a subsequent period, it is written off against the al-
lowance account. Subsequent recoveries of amounts previously written off are credited against other expenses in profit or
loss.
(x)
Work in progress
Work in progress is stated as the aggregate of costs incurred to date plus recognised profits less recognised losses and pro-
gress billings. Cost includes all costs directly related to specific contracts, and an allocation of overhead costs attributable to
contract activity in general.
Project profits are recognised on the stage of completion basis and measured using the proportion of costs incurred to date as
compared to expected total costs. Where losses are anticipated they are provided for in full.
Project revenue has been recognised on the basis of the terms of the contract adjusted for any variations or claims allowable
under the contract. Any credit balance in work in progress is reclassified as income in advance.
When the outcome of the project cannot be estimated reliably, revenue is only recognised to the extent that the costs incurred
are recoverable.
(y)
Trade and other payables
Trade and other payables represent the principal amounts outstanding at balance date, plus, where applicable, any accrued
interest. These amounts are unsecured and are usually settled within 30 days of recognition.
Page 34 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
(z)
Operating segments
The Company has identified its operating segments based on internal reports that are reviewed and used by the Board of
Directors (chief operating decision makers) to make financial and operational decisions and to allocate resources. We at-
tribute sales to an operating segment based on the type of product or service provided to the customer.
We have identified three reportable segments, as follows:
-
-
-
Technology Sales – provision of vendor hardware, software and associated licenses and maintenance contracts;
Professional Services – provision of a range of specialist services including consulting, project management,
systems and software engineering services to assist clients with strategy, architecture, design, development and
implementation of ICT solutions; and
Recurring Services – a combination of managed services including operations, support and ICT management,
as well as a range of in-house developed commercialised IP and Cloud (SAAS) based solutions.
The consolidated entity primarily services clients in one geographical segment being Australia, with support from Australia,
Sri Lanka, Singapore and New Zealand. However, there are no material revenues generated outside of Australia, and as a
result no additional geographical segment information has been provided.
(aa)
Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not
recoverable from the Australian Taxation Office (ATO).
Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recov-
erable from, or payable to, the ATO is included with other receivables or payables in the statement of financial position.
Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities
which are recoverable from, or payable to, the ATO are presented as operating cash flows included in receipts from customers
or payments to suppliers.
(bb)
New Accounting Standards for Application in Future Periods
Accounting Standards and Interpretations issued by the AASB that are not yet mandatorily applicable to the Group, together
with an assessment of the potential impact of such pronouncements on the Group when adopted in future periods, are dis-
cussed below:
AASB 9: Financial Instruments and associated Amending Standards
Applicable to annual reporting periods beginning on or after 1 January 2018.
The Standard will be applicable retrospectively (subject to the provisions on hedge accounting outlined below) and includes
revised requirements for the classification and measurement of financial instruments, revised recognition and de-recognition
requirements for financial instruments and simplified requirements for hedge accounting.
The key changes that may affect the Group on initial application include certain simplifications to the classification of fi-
nancial assets, simplifications to the accounting of embedded derivatives, upfront accounting for expected credit loss, and the
irrevocable election to recognise gains and losses on investments in equity instruments that are not held for trading in other
comprehensive income. AASB 9 also introduces a new model for hedge accounting that will allow greater flexibility in the
ability to hedge risk, particularly with respect to hedges of non-financial items. Should the entity elect to change its hedge
policies in line with the new hedge accounting requirements of the Standard, the application of such accounting would be
largely prospective.
Page 35 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
Although the directors anticipate that the adoption of AASB 9 may have an impact on the Group’s financial instruments, it is
impracticable at this stage to provide a reasonable estimate of such impact.
AASB 15: Revenue from Contracts with Customers
Applicable to annual reporting periods commencing on or after 1 January 2017. When effective, this Standard will replace the
current accounting requirements applicable to revenue with a single, principles-based model. Except for a limited number of
exceptions, including leases, the new revenue model in AASB 15 will apply to all contracts with customers as well as
non-monetary exchanges between entities in the same line of business to facilitate sales to customers and potential customers.
The core principle of the Standard is that an entity will recognise revenue to depict the transfer of promised goods or services
to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for the goods
or services. To achieve this objective, AASB 15 provides the following five-step process:
(i)
(ii)
(iii)
(iv)
(v)
identify the contract(s) with a customer;
identify the performance obligations in the contract(s);
determine the transaction price;
allocate the transaction price to the performance obligations in the contract(s); and
recognise revenue when (or as) the performance obligations are satisfied.
This Standard will require retrospective restatement, as well as enhanced disclosures regarding revenue.
Although the directors anticipate that the adoption of AASB 15 may have an impact on the Group's financial statements, the
quantum, if any, of impact has not yet been assessed.
AASB 16: Leases
Applicable to annual reporting periods commencing on or after 1 January 2019. When effective, this Standard will replace the
current accounting requirements applicable to leases in AASB 117: Leases and related interpretations. AASB 16 introduces a
single lessee accounting model that eliminates the requirement for leases to be classified as either operating leases or finance
leases. Lessor accounting remains similar to current practice.
The main changes introduced by the new Standard are as follows:
(i)
(ii)
(iii)
(iv)
recognition of the right-to-use asset and liability for all leases (excluding short term leases with less than 12
months of tenure and leases relating to low value assets);
depreciating the right-to-use assets in line with AASB 116: Property, Plant and Equipment in profit or loss and
unwinding of the liability in principal and interest components;
inclusion of variable lease payments that depend on an index or a rate in the initial measurement of the lease lia-
bility using the index or rate at the commencement date;
application of a practical expedient to permit a lessee to elect not to separate non-lease components and instead
account for all components as a lease; and
(v)
additional disclosure requirements.
The transitional provisions of AASB 16 allow a lease to either retrospectively apply the Standard to comparatives in line with
AASB 108 or recognise the cumulative effect of retrospective application as an adjustment to opening equity at the date of
initial application.
Although the directors anticipate that the adoption of AASB 16 may have an impact on the Group's financial statements, it is
impracticable at this stage to provide a reasonable estimate of such impact.
Page 36 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 2: CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The Directors evaluate estimates and judgements incorporated into the financial report based on historical knowledge and best
available current information. Estimates assumed a reasonable expectation of future events and are based on current trends
and economic data, obtained both externally and within the Company.
Key Estimates
Impairment of Non-Current Assets
The Company assesses impairment at each reporting date by evaluating conditions specific to the Group that may lead to an
impairment of assets. Where an impairment trigger exists, the recoverable amount of the asset is determined. Value-in-use
calculations performed in assessing recoverable amounts incorporate a number of key estimates.
Debtors (Bad Debt Provision)
The provision for impairment of receivables assessment requires a degree of estimation and judgement. The level of provision
is assessed by taking into account the recent sales experience, historical collection rates and specific knowledge of the indi-
vidual debtors’ financial position.
Impairment of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash generating units to which
goodwill has been allocated. The value in use calculation requires the directors to estimate the future cash flows expected to
arise from the cash-generating unit and a suitable discount rate in order to calculate present value. Where the actual future cash
flows are less than expected, a material impairment loss may arise.
Taxation
The Group’s accounting policy for taxation requires management’s judgment in assessing whether deferred tax assets and
deferred tax liabilities are recognized in the Statement of Financial Position. Deferred tax assets, including those arising from
un-recouped tax losses and temporary differences are recognized only where it is considered more likely than not that they
will be recovered, which is dependent upon the generation of sufficient future taxable profits.
Assumptions about the generation of future profits depend upon management’s estimates of future profitability and cash
flows. These depend upon estimates of future income, operating costs, capital expenditure, dividends and other capital
management transactions. Judgments and assumptions are also required in relation to the application of income tax legisla-
tion. These judgments and assumptions are subject to risk and uncertainty. Therefore there is a possibility that changes in
circumstances will alter expectations, which may impact the amount of deferred tax assets and deferred tax liabilities recog-
nized in the Statement of Financial Position and the amount of tax losses and temporary differences not yet recognized. In
such circumstances, some or all of the carrying amounts of recognized deferred tax assets and liabilities may require ad-
justment, resulting in a correction to the Statement of Comprehensive Income.
Recoverability of Work in Progress
The Company assesses work in progress on a monthly basis to determine whether the amounts accrued are recoverable to the
Group when billed to customers. At the reporting date, the directors believe that the carrying value of work in progress is
recoverable in full.
Valuation of Provisions
The Company has assessed the value of provisions at the reporting date in line with the accounting policy at Note 1(r).
Risk management is the role and responsibility of the board. The Group’s current activities expose it to minimal risk.
However, as activities increase there may be exposure to credit, liquidity, foreign currency and interest rate risks.
Determination of Intangible Property Acquired
The company has assessed the value of intangible property acquired from the acquisition of Skoolbag and Tetran using
management’s judgement in determining the fair values of the property acquired.
Page 37 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 3: FINANCIAL RISK MANAGEMENT
(a)
Credit Risk
The Group has no significant concentrations of credit risk and as such, no sensitivity analysis is prepared by the Group. The
ageing of the Group’s trade and other receivables net of bad debt provisions at the reporting date is:
2017
2016
Current
30 - 60 days
60 - 90 days
More than 90 days
$
7,159,229
487,918
154,535
370,570
8,172,252
$
5,044,156
580,481
324,828
208,304
6,157,769
The directors believe that the above stated balances are fully recoverable.
(b) Liquidity
Prudent liquidity risk management implies maintaining sufficient cash to meet commitments as and when they fall due. The
Group manages liquidity risk by preparing forecasts and monitoring actual cash flows and requirements for future capital
raisings. The Group has a committed credit line available, which is appropriate given the nature of its operations. Surplus
funds are invested in a cash management account with Westpac Banking Corporation, St George and HSBC which is
available as required.
The material liquidity risk for the Group is the ability to raise equity or access debt finance as required in the future.
(c) Interest rate risk
The Group’s exposure to interest rate risk, which is the risk that a financial instrument’s value will fluctuate as a result of
changes in market rates and the effective weighted average interest rates on classes of financial assets and financial liabilities,
is:
1 year or less
Floating Inter-
est Rate
$
Fixed
Interest
Rate
$
Non
Interest
Bearing
$
Over 1 to
5 years
Non
Interest
Bearing
$
-
-
-
-
-
-
-
3,265,505
8,172,252
648,499
12,086,256
(7,361,808)
-
(7,361,808)
-
-
-
-
-
-
-
Total
$
3,265,859
8,172,252
648,499
12,086,610
(7,361,808)
-
(7,361,808)
-
4,724,448
-
4,724,802
354
-
-
354
0.00%
-
-
-
Nil
354
30 June 2017
Financial assets
Cash and deposits
Current receivables
Other assets
Weighted average interest rate
Financial liabilities
Trade and other payables
Borrowings
Weighted average interest rate
Net financial assets / (liabilities)
The directors do not consider the results of the Group to be subject to significant sensitivity arising from interest rate risks.
Page 38 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 3: FINANCIAL RISK MANAGEMENT (CONT.)
1 year or less
Floating
Interest
Rate
$
Fixed
Interest
Rate
$
Non
Interest
Bearing
$
Over 1 to 5
years
Non
Interest
Bearing
$
-
-
-
-
1,976,302
6,298,691
273,602
8,548,595
-
-
-
-
Total
$
3,078,326
6,298,691
273,602
9,650,619
-
-
-
(5,018,996)
-
(5,018,996)
-
-
-
(5,018,996)
-
(5,018,996)
30 June 2016
Financial assets
Cash and deposits
Current receivables
Other assets
Weighted average interest rate
Financial liabilities
Trade and other payables
Borrowings
Weighted average interest rate
1,102,024
-
-
1,102,024
0.75%
-
-
-
Nil
Net financial assets / (liabilities)
1,102,024
-
3,529,599
-
4,631,623
(d) Foreign currency risk
The Group has subsidiaries in Sri Lanka, Singapore and New Zealand, which serves primarily as service and support centres.
As all intercompany loans are repayable in AUD$, the group is not materially exposed to foreign currency risk.
(e) Fair value hierarchy
The Group has not disclosed the fair values for financial instruments such as short-term trade receivables and payables be-
cause their carrying amounts are a reasonable approximation of their fair values.
Page 39 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 4: SEGMENT INFORMATION
The segment information provided to the Board of directors, for the reportable segments is as follows:
30 June 2017
Recurring
Services
$
Professional
Services
$
Technology
Sales
$
Revenue from external customers
10,768,189
15,018,743
29,082,073
Unallocated
$
-
Total
$
54,869,005
Other income
-
-
-
149,973
149,973
Total Reportable Segment results
3,234,011
3,210,306
5,080,224
(11,270,145)
254,396
-
-
-
-
-
-
28,129,894
10,566,188
28,129,894
10,566,188
Total segment assets
Total segment liabilities
30 June 2016
Revenue from external customers
4,827,672
10,741,641
18,365,037
Recurring
Services
$
Professional
Services
$
Technology
Sales
$
Unallocated
$
-
Total
$
33,934,350
Other income
-
-
-
222,646
222,646
Total Reportable Segment results
1,778,251
963,751
3,220,971
(6,625,726)
(662,753)
Total segment assets
Total segment liabilities
-
-
-
-
-
-
25,690,861
8,448,901
25,690,861
8,448,901
Page 40 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 5: PARENT ENTITY DETAILS
Summarised presentation of the parent entity, MOQ Limited:
(a) Summarised statement of financial position
Assets
Current assets
Non current assets
Total assets
Liabilities
Current liabilities
Non current liabilities
Total liabilities
Net assets
Equity
Share Capital
Reserves
Accumulated losses
Total equity
(b) Summarised statement of comprehensive income
Profit / (Loss) for the year
Other comprehensive income for the year
Total comprehensive income / (loss) for the year
(c) Guarantees entered into by the parent
The parent has not entered into any guarantees.
(d) Contingent liabilities of the parent
2017
$
2016
$
488,874
18,947,414
19,436,288
(129,718)
(1,377,674)
(1,507,392)
17,928,896
3,408,248
15,007,478
18,415,726
(1,113,951)
-
(1,113,951)
17,301,775
49,615,752
120,295
(31,807,151)
17,928,896
49,365,752
8,665
(32,072,642)
17,301,775
265,491
-
265,491
(249,288)
-
(249,288)
The parent notes that there may be a contingent liability in respect of the issue of shares related to performance hurdles in
Skoolbag, subject to performance exceeding expectations.
(e) Commitments of the parent
The parent does not have any commitments.
NOTE 6: REVENUE AND OTHER INCOME
(a) Revenue from operations
(b) Other income
Interest received
Other income
2017
$
54,869,005
2016
$
33,934,350
15,684
134,289
149,973
7,055
215,591
222,646
Total revenue and other income
55,018,978
34,156,996
Page 41 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 7: OPERATING PROFIT / LOSS
Loss before income tax includes the following expenses:
(a) Cost of sales
Technology
Recurring services
Professional services
(b) Depreciation – office equipment and software
Amortisation – intangible assets
(c) Employee benefits, other labour and related expenses
Wages and salaries
Superannuation
Other employee benefits expenses
(d) Legal costs
(e) Professional fees
Consultants fees*
Compliance fees*
*Largely relates to the acquisition of TETRAN and Skoolbag in the prior year.
NOTE 8: INCOME TAX
(a) The components of tax income / (expense) comprise:
Current tax
Deferred tax
2017
$
24,001,849
7,534,178
11,808,437
43,344,464
206,004
313,003
519,007
5,903,807
460,240
939,648
7,303,695
128,949
97,833
205,601
303,434
2016
$
15,144,066
3,049,421
9,777,890
27,971,377
110,009
-
110,009
2,869,523
283,170
1,261,317
4,414,010
33,978
107,033
230,284
337,317
2017
$
(117,457)
(35,963)
(153,420)
2016
$
(216,562)
344,711
128,149
Page 42 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 8: INCOME TAX (CONT.)
(b) Numerical Reconciliation of Income Tax Expense to Prima Facie Tax Payable
Profit / (Loss) before income tax expense
Income tax calculated at 30% (2016: 30%)
Tax effect of amounts which are not taxable income
Tax loss not recognised
Income tax (expense) / benefit
The applicable weighted average effective tax rates are as follows:
(c) Tax effects relating to other comprehensive income
There is no tax effect relating to components of other comprehensive income.
2017
$
254,396
(76,319)
(77,101)
-
(153,420)
(60.3%)
2016
$
(662,753)
198,826
(70,677)
-
128,149
(19.3%)
(d) Tax losses
Approximate unused tax losses for which no deferred tax asset has been recognised
Potential tax benefit at 30% (2016: 30%)
-
-
-
-
Tax losses related to the entity prior to the reconstruction that were not used have been lost in accordance with the continuity of
business rules under the Australian Taxation legislation.
NOTE 9: CASH AND CASH EQUIVALENTS
Cash at bank
Term deposit
$
NOTE 10: TRADE AND OTHER RECEIVABLES
Trade receivables
Provision for doubtful debts
Other receivables
Accrued revenue
2017
$
3,265,859
-
3,265,859
2016
$
3,078,326
-
3,078,326
2017
$
8,277,188
(144,528)
39,592
8,172,252
-
-
2016
$
5,701,823
(206,112)
662,058
6,157,769
140,922
140,922
8,172,252
6,298,691
Management believes that any debts that have not provided for and are past due by more than 30 days are still collectible in full
based on historic payment behaviour.
Please refer to Note 3(a) for a further breakdown of the ageing of receivable amounts.
Page 43 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 11: WORK IN PROGRESS
Work In Progress
$
NOTE 12: OTHER ASSETS
(a) OTHER ASSETS - CURRENT
Deposits
Inventory
Prepayments
Other
(b) OTHER ASSETS – NON-CURRENT
Deposits
NOTE 13: DEFERRED TAX ASSETS
Deferred Tax Assets
$
NOTE 14: PROPERTY, PLANT AND EQUIPMENT
2017
$
309,578
309,578
2016
$
220,676
220,676
2017
$
-
-
648,499
-
648,499
2016
$
2,289
19,420
251,452
441
273,602
377,460
377,460
187,540
187,540
2017
$
687,884
687,884
2016
$
723,847
723,847
At 30 June 2017
Cost
Accumulated depreciation
At 30 June 2016
Cost
Accumulated depreciation
Leasehold
Improvements
$
298,817
(115,272)
183,545
Leasehold
Improvements
$
299,619
(54,893)
244,726
Office
Equipment &
Software
$
889,002
(547,011)
341,991
Office
Equipment &
Software
$
734,769
(527,145)
207,624
Total
$
1,187,819
(662,283)
525,536
Total
$
1,034,388
(582,038)
452,350
Page 44 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 14: PROPERTY, PLANT AND EQUIPMENT (CONT.)
Reconciliation of carrying amounts at the beginning and end of the year:
At 1 July 2016
Additions
Disposals
Depreciation
At 30 June 2017
At 1 July 2015
Additions (1)
Disposals
Depreciation
Impairment due to Administration
At 30 June 2016
(1) Acquired as part of the acquisition of Tech Effect.
NOTE 15: INTANGIBLE ASSETS
Goodwill on acquisition of TETRAN Group
Goodwill on acquisition of Skoolbag(1)
Intangible Property Acquired TETRAN Group
Intangible Property Acquired Skoolbag(1)
Leasehold
Improvements
$
244,726
-
(802)
(60,379)
183,545
Plant and
Equipment
$
207,624
279,992
-
(145,625)
341,991
Leasehold
Improvements
$
Plant and
Equipment
$
-
299,619
-
(54,893)
-
244,726
94,451
168,289
-
(55,116)
-
207,624
Total
$
452,350
279,992
(802)
(206,004)
525,536
Total
$
94,451
467,908
-
(110,009)
-
452,350
2017
$
9,339,308
3,942,630
74,607
786,281
14,142,826
2016
$
9,339,308
4,650,428
223,821
242,272
14,455,829
(1)AASB 3 Business Combinations allow a measurement period after a business combination to provide the acquirer a rea-
sonable time to obtain the information necessary to identify and measure all the various components of the business combi-
nations as of acquisition date. Accordingly the company has reallocated $707,798 to Relationships acquired for Skoolbag.
Impairment Testing:
Goodwill arising from a business combination is allocated to CGUs (cash generating units) or groups that are expected to
benefit from the synergies of the combination. Accordingly, TETRAN’s CGU includes certain MOQdigital income. For the
purposes of impairment testing, goodwill has been allocated to MOQ’s CGUs as follows:
TETRAN
Skoolbag
2017
$
9,339,308
3,942,630
Page 45 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 15: INTANGIBLE ASSETS (CONT.)
The recoverable amounts were based on fair values estimated using discounted cash flows.
The key assumptions used in the estimation of the recoverable amount are set out below. The values assigned to the key as-
sumptions represents management’s assessment of future trends in the ICT industry and have been based on data from both
external and internal sources.
TETRAN
Discount rate
Terminal Value Growth Rate
Skoolbag
Discount rate
Terminal Value Growth Rate
2017
13%
2.5%
2017
13%
2.5%
The discount rate was a post-tax measure estimated based on a conservative mix of historical weighted average cost of capital
and debt.
The cashflow projections included specific estimates for 4 years for TETRAN and 3 years for Skoolbag. The basis of estimation
of the four and three-year cash flows uses the following key operating assumptions:
- Four and three year budgeted EBITDA is based on management’s forecasts of revenue from its operating segments. Rev-
enue forecasts take into account historical revenue and consider external factors such as market sector.
- Costs are calculated taking into account historical margins, known increases and estimated inflation rates over the period.
The estimated recoverable amount of the CGUs exceeded their carrying amounts by $7.43 million for TETRAN and $290,000
for Skoolbag. Management recognises that actual results (EBITDA) may vary to what has been estimated. Management has
identified that a possible change in either of two key assumptions could cause the carrying amount to exceed the recoverable
amount. The following table shows the amount by which these two assumptions would need to change individually for the
estimated recoverable amount to be equal to the carrying amount.
Discount Rate
Average Budgeted EBITDA growth
rate
TETRAN-Managed
Services
2017
18%
91%
TETRAN-Professional
Services
2017
15%
183%
TETRAN-Technology
Skoolbag
2017
31%
134%
2017
27%
69%
NOTE 16: TRADE AND OTHER PAYABLES
Trade creditors
Other payables and accrued expenses
There are no trade and other payables that are considered past due.
2017
$
6,222,582
1,139,226
7,361,808
2016
$
2,716,459
2,302,537
5,018,996
Page 46 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 17: DEFERRED REVENUE
CURRENT
Unearned income – subscription, consulting and licenses
NOTE 18: PROVISIONS
CURRENT
Employee entitlements
-
-
Provision for Annual Leave
Provision for Long Service Leave
NON-CURRENT
Employee entitlements
-
Provision for Long Service Leave
2017
$
1,712,654
1,712,654
2016
$
2,029,235
2,029,235
2017
$
2016
$
691,735
722,209
1,413,944
814,573
538,048
1,352,621
77,782
77,782
48,049
48,049
Employee provisions includes the total amount accrued for annual leave entitlements and the amounts accrued for long service
leave entitlements that have vested due to employees having completed the required period of service. Based on past experi-
ence, the company does not expect the full amount of annual leave or long service leave balances classified as current liabilities
to be settled within the next 12 months. However, these amounts must be classified as current liabilities since the company does
not have an unconditional right to defer the settlement of these amounts in the event employees wish to use their leave enti-
tlement.
Page 47 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 19: SHARE CAPITAL
(a)
Details of share issues
For the 2017 financial year:
Date
Details
Dec-16
Dec-16
Dec-16
Balance at the beginning of the year
Securities issued for exercise of options
Performance shares issued Tetran*
Performance shares issued Skoolbag*
May-17
Securities issued for exercise of options
Total share capital
Share
Price $
No. of
Shares
Issue Value
$
0.10
0.10
154,713,558
900,000
49,365,752
90,000
2,857,144
1,250,000
1,600,000
-
-
160,000
161,320,702
49,615,752
Holders of ordinary shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share
at shareholder meetings, otherwise each member present at a meeting or by proxy has one vote on a show of hands. In the event
of the winding up of the Company, ordinary shareholders rank after creditors and share in any proceeds on winding up in
proportion to the number of shares held.
*Please refer to Note 31 for additional information on the Performance shares for TETRAN and Skoolbag.
Comparative information for share issues occurring in the 2016 financial year:
Date
Details
Jul-15
Sep-15
Apr-16
May-16
May-16
Balance at the beginning of the year
Securities issued for exercise of options
Securities issued for exercise of options
Capital raising pursuant to the offer under the prospectus dated
24 March 2016
Capital raising pursuant to the offer under the prospectus dated
24 March 2016
Consideration shares for TETRAN group of companies
May-16
Consolidation of shares on a 10:1 basis
Jun-16
Jun-16
Performance shares accrued Skoolbag
Performance shares accrued TETRAN
Capital raising costs
Total share capital
Share
Price $
No. of
Shares
Issue Value
$
1,073,671,213
833,333
33,285,143
8,333
2,499,999
25,000
0.01
0.01
0.0275
161,454,545
4,440,000
0.0275
165,818,182
4,560,000
0.035
142,857,144
5,000,000
-
(1,392,420,858)
-
0.04
0.035
-
-
1,500,000
1,000,000
(452,724)
154,713,558
49,365,752
Page 48 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 19: SHARE CAPITAL (CONT.)
(b)
Options
ASX Code
MOQOPT7
Unlisted
Balance at
30/06/2016
16,667
Balance at
30/06/2017
16,667
3,690,901
Exercise price
$7.00
$0.275
Expiry
12/02/2018
01/09/2020
A summary of the movements of all company options issues is as follows:
Options outstanding at 30 June 2016
Granted
Forfeited
Exercised
Expired
Options outstanding at 30 June 2017
Options exercisable as at 30 June 2017
Options outstanding at 30 June 2015
Granted
Forfeited
Exercised
Consolidation of options on 10:1 basis
Expired
Options outstanding at 30 June 2016
(d)
Capital management
No. of
Options
Weighted Average
Exercise Price
2,533,334
3,690,901
-
(2,500,000)
(16,667)
3,707,568
16,667
$0.19
$0.275
-
$0.10
$7.00
$0.305
$7.00
No. of
Options
Weighted Average
Exercise Price
28,833,333
-
-
(3,333,332)
(22,800,000)
(166,667)
2,533,334
$0.01
-
-
$0.01
$0.70
$0.19
Management controls the capital of the Group in order to generate long-term shareholder value and ensure that the Group can
fund its operations and continue as a going concern.
The Group’s capital includes ordinary share capital supported by financial assets.
The Group is not subject to any externally imposed capital requirements.
Page 49 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 19: SHARE CAPITAL (CONT.)
Management effectively manages the Group’s capital by assessing the Group’s financial risks and adjusting its capital structure
in response to changes in these risks and in the market. These responses include the management of debt levels, distributions to
shareholders and share issues.
There have been no changes in the strategy adopted by management to control the capital of the Group since the prior year.
NOTE 20: RESERVES
Reserves at the beginning of financial year
Option Premium Reserve
Foreign Exchange Translation Reserve
Reserves at end of financial year
NOTE 21: ACCUMULATED LOSSES
Accumulated losses at beginning of financial year
Net profit / (loss) for the year after income tax
Accumulated losses at end of financial year
NOTE 22: FRANKING CREDITS
Franking credits available for subsequent financial years
based on a tax rate of 30%
NOTE 23: KEY MANAGEMENT PERSONNEL DISCLOSURE
Compensation received by key management personnel of the consolidated
entity:
Short term employee benefits
Other payments
Other short term employee benefits
Post employment benefits
Termination benefits
2017
$
2,467
111,630
(140,860)
(26,763)
2016
$
8,665
-
(6,198)
2,467
2017
$
(32,126,259)
100,976
(32,025,283)
2016
$
(31,591,655)
(534,604)
(32,126,259)
2017
$
2016
$
964,244
699,679
2017
$
2016
$
2,016,388
30,000
6,599
157,414
-
2,210,401
1,357,851
-
-
117,595
-
1,475,446
Short-term employee benefits
These amounts include fees and benefits paid to the non-executive Chair and non-executive directors as well as all salary, paid
leave benefits, fringe benefits and cash bonuses awarded to executive directors and other KMP.
Post-employment benefits
These amounts are the current-year’s estimated cost of providing for the Group’s superannuation contributions made during the
year.
Page 50 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
23: KEY MANAGEMENT PERSONNEL DISCLOSURE (CONT.)
Other long-term benefits
These amounts represent long service leave benefits accruing during the year, long-term disability benefits and deferred bonus
payments.
Further information in relation to KMP remuneration can be found in the directors’ report.
NOTE 24: RELATED PARTY TRANSACTIONS
(a)
The Group’s main related parties are as follows:
(i)
Key management personnel:
Any person(s) having authority and responsibility for planning, directing and controlling the activities of the
entity, directly or indirectly, including any director (whether executive or otherwise) of that entity, are con-
sidered key management personnel.
For details of disclosures relating to key management personnel, refer to Note 23.
(ii)
Other related parties:
Other related parties include entities over which key management personnel have joint control.
(b)
Transactions with related parties:
Transactions between related parties are on normal commercial terms and conditions no more favourable than those
available to other parties unless otherwise stated.
MOQdigital provided professional services sales of $123,081 Alleasing group, a company that is controlled by
Monash Private Capital. Monash Private Capital is an entity associated with Joey Fridman and David Shein. An
amount of $21,450 related to these services were outstanding as at 30 June 2017.
(c)
Loans to/from related parties:
There are no amounts outstanding or payable to related parties as at 30 June 2017 (2016: $Nil).
NOTE 25: AUDITOR’S REMUNERATION
Amounts paid / payable to Stantons International for audit and review work under-
taken under the Corporation Act 2001
Auditing or reviewing the financial report
Completion accounts audit
2017
$
2016
$
81,596
-
81,596
64,064
10,000
74,064
NOTE 26: CONTINGENT LIABILITIES AND CONTINGENT ASSETS
The company notes that there may be a contingent liability in respect of the issue of shares related to performance hurdles for
FY17 in Skoolbag, subject to performance exceeding expectations.
Page 51 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 27: CAPITAL AND LEASING COMMITMENTS
Operating lease commitments
Payable - minimum lease payments
- not later than 1 year
- later than 1 year and not later than 5 years
- later than 5 years
NOTE 28: EARNINGS / LOSS PER SHARE
(a) Basic earnings / (loss) per share (cents per share)
From continuing operations
(b) Diluted earnings / (loss) per share (cents per share)
From continuing operations
(c) Reconciliation of earnings / (loss) in calculating earnings per share
Basic and diluted (loss) / profit per share
Loss from continuing operations attributable to ordinary equity holders
(d) Total shares
Weighted average number of ordinary shares outstanding during the year
used in the calculation of basic earnings / (loss) per share
2017
$
350,745
1,126,973
-
1,477,718
2016
$
436,374
959,010
-
1,395,384
2017
$
2016
$
0.06
(0.05)
0.06
(0.05)
100,976
(534,604)
157,578,647
1,030,297,149
Weighted average number of ordinary shares outstanding during the year
used in the calculation of diluted earnings / (loss) per share
160,632,488
1,030,297,149
NOTE 29: DISCONTINUED OPERATIONS
There were no discontinued operations in 2017 or 2016.
Page 52 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 30: CASH FLOW INFORMATION
Reconciliation of net cash provided by operating activities
to net (loss) / profit after tax
Profit / (loss) for the period after tax
Add back: Income tax expense / (credit)
(Loss) / profit for the period before tax
Non cashflows and non-operating cashflows in profit / (loss):
Depreciation / Amortisation
(Gains) / Losses on disposal of fixed assets
Assets acquired
Other items
Change in assets and liabilities:
Decrease / (Increase) in trade debtors
Decrease / (Increase) in work in progress
Decrease / (Increase) in current tax receivable
Decrease / (Increase) in other current assets
Decrease / (Increase) in deferred tax assets
Increase / (Decrease) in payables
Increase / (Decrease) in loans
Increase / (Decrease) in other liabilities
Increase / (Decrease) in unearned revenue
Increase / (Decrease) Short term borrowings
Increase / (Decrease) in provision for employee entitlements
2017
$
100,976
153,420
254,396
519,007
-
-
-
(2,348,561)
(88,902)
(376,688)
35,963
3,096,533
-
-
(316,581)
-
91,056
2016
$
(534,604)
(128,149)
(662,753)
110,009
-
(345,261)
-
(779,977)
(73,831)
113,366
304,314
(344,711)
(461,561)
-
-
26,872
-
482,822
Cash flow from operations
866,223
(1,630,711)
Page 53 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
NOTES TO THE CONSOLIDATED FINANCIAL REPORT
NOTE 31: SHARE BASED PAYMENTS
On 22 December 2016, the Company issued 2,857,144 shares at a deemed issue price of $0.35 per share which were condi-
tional upon TETRAN achieving certain EBITDA targets in FY16.
On the 22 December 2016, the Company issued 1,250,000 shares at a deemed issue price of $0.40 per share which were con-
ditional upon Skoolbag achieving certain performance targets in FY16.
On 1 September 2016, an Employee Option Plan was introduced, which provided certain key management and employees with
3,690,901 unlisted and unvested options. These options have an exercise price of $0.275 each, vest upon employee period of
service milestones and expire on 1 September 2020.
NOTE 32: CONTROLLED ENTITIES
Name of entity
iimage Technical Services Pty Ltd
TETRAN Pty Ltd
TETRAN NZ Limited
TETRAN (Singapore) Pte Limited
T.I.M. Asia Pacific (PVT) Limited
MOQdigital Pty Ltd
Breeze Training Pty Ltd
Pinnacle Software (Australia) Pty Ltd
OneBet IP Pty Ltd
OneBet Trading Pty Ltd
Equity holding
Country of
Incorporation
Australia
Australia
New Zealand
Singapore
Sri Lanka
Australia
Australia
Australia
Australia
Australia
Class of Shares
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
Ordinary
2017
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
2016
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
NOTE 33: EVENTS SUBSEQUENT TO REPORTING DATE
On 5th July 2017, Don Francis Nanayakkara announced his resignation as a non-executive director from the board of MOQ
Limited.
On 31st July 2017, Jonathan Pager announced his resignation as a non-executive director from the board of MOQ Limited.
END OF AUDITED STATEMENTS
Page 54 of 62
MOQ LIMITED AND ITS CONTROLLED ENTITIES
ANNUAL REPORT FOR THE YEAR ENDED 30 JUNE 2017
ABN: 94 050 240 330
DIRECTORS’ DECLARATION
In accordance with a resolution of the directors of MOQ Limited (the “Company”), the directors of the company declare
that:
1.
In the opinion of the directors of the Company, the financial statements and notes, as set out on pages 19 to 55 are
in accordance with the Corporations Act 2001 and
i.
ii.
comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the
financial statements, constitutes compliance with International Financial Reporting Standards
(IFRS); and
give a true and fair view of the financial position as at 30 June 2017 and of the performance for the
year ended on that date of the consolidated group;
2.
3.
4.
in the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as
and when they become due and payable;
the audited remuneration disclosures set out on pages 11 to 18 of the directors’ report comply with accounting
standard AASB 124 Related Party Disclosures and the Corporation Regulations 2001; and
the directors have been given the declarations required by s 295A of the Corporations Act 2001 from the Chief
Executive Officer.
On behalf of the Directors
David Shein
Non Executive Chairman
28 September 2017
Page 55 of 62
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
28 September 2017
Board of Directors
MOQ Limited
Suite 1,Ground Floor
3-5 West Street
North Sydney,NSW,2060
Dear Sirs
RE: MOQ LIMITED
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the following
declaration of independence to the directors of MOQ Limited.
As Audit Director for the audit of the financial statements of MOQ Limited for the year ended 30 June 2017, I
declare that to the best of my knowledge and belief, there have been no contraventions of:
(i)
the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and
(ii)
any applicable code of professional conduct in relation to the audit.
Yours faithfully,
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LIMITED
(Trading as Stantons International)
(An Authorised Audit Company)
Martin Michalik
Director
Liability limited by a scheme approved
under Professional Standards Legislation
Stantons International Audit and Consulting Pty Ltd
trading as
Chartered Accountants and Consultants
PO Box 1908
West Perth WA 6872
Australia
Level 2, 1 Walker Avenue
West Perth WA 6005
Australia
Tel: +61 8 9481 3188
Fax: +61 8 9321 1204
ABN: 84 144 581 519
www.stantons.com.au
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF
MOQ LIMITED
Report on the Audit of the Financial Report
Opinion
We have audited the financial report of MOQ Limited, the Company and its subsidiaries (the Group), which
comprises the consolidated statement of financial position as at 30 June 2017, the consolidated statement of
profit or loss and other comprehensive income, the consolidated statement of changes in equity and the
consolidated statement of cash flows for the year then ended, and notes to the financial statements, including
a summary of significant accounting policies, and the directors' declaration.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
(i)
giving a true and fair view of the Group's financial position as at 30 June 2017 and of its financial
performance for the year then ended; and
(ii)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those
standards are further described in the Auditor's Responsibilities for the Audit of the Financial Report section of
our report. We are independent of the Group in accordance with the auditor independence requirements of the
Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards
Board's APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the
financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the
Code.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Key Audit Matters
We have defined the matters described below to be key audit matters to be communicated in our report.
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial report of the current period. These matters were addressed in the context of our audit of the
financial report as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on
these matters.
Liability limited by a scheme approved
under Professional Standards Legislation
Key Audit Matters
How the matter was addressed in the audit
Revenue recognition
There is an inherent risk with the recording of
revenue given the different activities and revenue
streams, and their resulting quantum for the
Group.
Inter alia, our audit procedures
following:
included
the
i. Performing tests for accuracy, completeness and
cut-off of customer invoicing on a sample basis;
of
revenue
application
The
recognition
accounting standards is complex and involves a
number of key
judgements and estimates,
the assessment of performance
including
obligations.
ii. Testing
from
the reconciliation
the business
support systems (billing systems) to the general
ledger. These tests included, inter alia, validation
of material
the
business systems and general ledger;
journals processed between
Revenue recognition has been assessed as a
key audit matter due to the significant evaluation
involving
the assessment of management’s
judgement and estimates.
iii. Testing cash receipts for a sample of customers
back to invoices; and
iv. Considering the accuracy, and discussion with
management, of
in
revenue recognition and appropriate disclosure in
the financial statements.
the assumptions used
Goodwill and Intangibles
The Group carries Goodwill and Intangibles
totalling $14,142,826 (refer to Note 15) as per
the application of the Group's accounting policy
for Goodwill and Intangible assets, as set out in
Notes 1(c) and 1(n).
The carrying value of Goodwill and Intangible is a
key audit matter due to:
• The significance of the total balance (50%
of total assets);
• For the Cash Generating Units (CGU’s)
which contain goodwill, the determination
of recoverable amounts, being the higher
of fair value less costs to sell and value-
in-use, requires judgement on the part of
management in both identifying and then
valuing the relevant CGU’s; and
• The assessment of impairment of the
Group’s goodwill and Other Intangibles
balances
significant
incorporated
judgement in respect of factors such as
discount rates and growth rates.
Goodwill is also considered to be a key audit
matter as the Group’s value in use model for
impairment included appropriate consideration of
these factors on their significant estimates and
judgements and the selection of key external and
internal inputs.
Inter alia, our audit procedures included the following:
i. The assessment of management’s determination
of the Group’s CGUs based on our understanding
of the nature of the Group’s business and
economic environment in which the segments
operate. We also analysed the internal reporting
of the Group to assess how earnings streams are
monitored and reported;
ii. The evaluation of management’s process
regarding the valuation of the Group’s goodwill
to determine any potential asset
assets
impairment. We have
tested management’s
models, including the preparation and review of
forecasts;
iii. The audit of
the Group’s assumptions and
estimates used to determine the recoverable
value of its Goodwill and Intangible assets,
including those relating to forecasted revenue,
cost and discount rates;
iv. Checking the cash flow models and corroboration
of underlying data; and
vi. Performing a sensitivity analysis on the main
areas. These included the appropriateness of the
discount rate used and growth assumptions for
the CGUs with a higher risk of impairment.
Recoverability of Trade and Other
Receivables
As at 30 June 2017, the Group had Trade and
Other Receivables totalling $8,172,252.
Inter alia, our audit procedures included the following:
Management assesses the recoverability of trade
receivables by
reviewing customers’ aging
profiles, credit history and status of subsequent
settlement,
an
and
impairment provision is required.
determines whether
Trade and Other Receivables is a key audit
matter due to the significance of the total balance
(approximately 29% of total assets), in addition to
the inherent subjectivity that is involved in the
Group making judgements in relation to credit
risk exposures, to identify impairment events, if
any,
the
to
recoverability of Receivables.
determine
ultimately
and
i. Testing key controls, approval processes and
trade
subsequent
receipts
of
verifying
receivables;
ii. Obtaining a list of outstanding receivables and
identifying, and adjusting for, any debtors with
financial difficulty
through discussion with
management; and
iii. Assessing the recoverability of the balances by
comparing the outstanding amounts as at year
end against subsequent settlements.
Other Information
The directors are responsible for the other information. The other information comprises the information
included in the Group’s annual report for the year ended 30 June 2017, but does not include the financial
report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do not express any
form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other information and, in
doing so, consider whether the other information is materially inconsistent with the financial report or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of the Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and
fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such
internal control as the directors determine is necessary to enable the preparation of the financial report that
gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the Group to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern
basis of accounting unless the directors either intend to liquidate the Group or to cease operations, or has no
realistic alternative but to do so.
Auditor's Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from
material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in
accordance with the Australian Auditing Standards will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of this
financial report.
As part of an audit in accordance with Australian Auditing Standards, we exercise professional judgement and
maintain professional scepticism throughout the audit. An audit involves performing procedures to obtain audit
evidence about the amounts and disclosures in the financial report.
The procedures selected depend on the auditor's judgement, including the assessment of the risks of material
misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the
auditor considers internal control relevant to the entity's preparation of the financial report that gives a true and
fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose
of expressing an opinion on the effectiveness of the entity's internal control.
The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of
accounting estimates made by the Directors, as well as evaluating the overall presentation of the financial
report.
We conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may
cast significant doubt on the Group's ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the
financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause
the Group to cease to continue as a going concern.
We evaluate the overall presentation, structure and content of the financial report, including the disclosures,
and whether the financial report represents the underlying transactions and events in a manner that achieves
fair presentation.
We obtain sufficient appropriate audit evidence regarding the financial information of the entities or business
activities within the Group to express an opinion on the financial report. We are responsible for the direction,
supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in Internal control that we identify during our
audit.
The Auditing Standards require that we comply with relevant ethical requirements relating to audit
engagements. We also provide the Directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the Directors, we determine those matters that were of most significance
in the audit of the consolidated financial report of the current period and are therefore key audit matters. We
describe these matters in our auditor's report unless law or regulation precludes public disclosure about the
matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in
our report because the adverse consequences of doing so would reasonably be expected to outweigh the
public interest benefits of such communication.
Report on the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 11 to 18 of the directors’ report for the year
ended 30 June 2017.
In our opinion the Remuneration Report of MOQ Limited for the year ended 30 June 2017 complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration Report
in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an opinion on
the Remuneration Report, based on our audit conducted in accordance with Australian Auditing Standards.
STANTONS INTERNATIONAL AUDIT AND CONSULTING PTY LTD
(Trading as Stantons International)
(An Authorised Audit Company)
Martin Michalik
Director
West Perth, Western Australia
28 September 2017
MONTECH HOLDINGS LIMITED AND ITS CONTROLLED ENTITIES
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
ABN: 94 050 240 330
The following information is current as at 22 September 2017.
ORDINARY SHARES
161,320,702 fully paid ordinary shares held by 741 individual shareholders. All ordinary shares carry one vote per share.
UNQUOTED OPTIONS
The Company has on issue:
•
•
16,667 options exercisable at $7.00 expiring on 12 February 2018 across 1 holder.
3,690,901 options exercisable at 27.5 cents expiring on 1 September 2020 amongst MOQ employees.
Options do not carry any votes
DISTRIBUTION OF HOLDERS FULLY PAID ORDINARY SHARES
Category
100,001 and Over
10,001 to 100,000
5,001 to 10,000
1,001 to 5,000
1 to 1,000
Total
Number of
holders
Number held
% of issued
shares
98
268
56
59
260
741
149,373,394
11,293,783
455,865
167,322
30,338
161,320,702
92.60
7.00
0.28
0.10
0.02
100.00
The number of holders who held less than a marketable parcel of shares was nil.
SUBSTANTIAL SHAREHOLDERS
The names of substantial shareholders who have notified the Company in accordance with Section 671B of the Cor-
porations Act are:
Holder
MONASH PRIVATE CAPITAL PTY LTD
MR SCOTT MCPHERSON
KATHY LOUISE EDWARDS
MATTHEW CHARLES GOGGIN & ROMILY JANE GOGGIN
No. of
ordinary shares
18,228,334
17,708,478
17,655,978
8,827,989
%
ordinary
shares
11.30
10.98
10.94
5.47
Page 61 of 62
MONTECH HOLDINGS LIMITED AND ITS CONTROLLED ENTITIES
ADDITIONAL INFORMATION FOR LISTED PUBLIC COMPANIES
ABN: 94 050 240 330
TOP 20 HOLDERS OF EQUITY SECURITIES
Rank
Name
06 Sep 2017 %IC
1
2
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
MONASH PRIVATE CAPITAL PTY LTD
KATHY LOUISE EDWARDS
MR SCOTT MCPHERSON
J P MORGAN NOMINEES AUSTRALIA LIMITED
MATTHEW CHARLES GOGGIN & ROMILY JANE GOGGIN
DON FRANCIS NANAYAKKARA
CITICORP NOMINEES PTY LIMITED
NICOLA JANINE PAGE
NATIONAL NOMINEES LIMITED
ANACACIA PTY LIMITED
KOMATIE PTY LTD
OSKA INDIA PTY LTD
DAVCOL NOMINEES PTY LTD
UNITED EQUITY PARTNERS PTY LTD
HOLLOWAY COVE PTY LTD
JARREN INVESTMENTS PTY LTD
INFLECTION INVESTMENTS PTY LTD
MR MARLON LUKE DE CRUZ
MR KAI MYSLIWIECZ
POLFAM PTY LTD
INFLECTION INVESTMENTS PTY LTD
Total
Grand total
18,228,334
17,655,978
17,655,978
17,112,854
11.30
10.94
10.94
10.61
8,827,989
6,602,834
6,262,296
4,892,957
4,207,433
4,174,883
4,110,457
3,125,000
2,500,001
2,130,000
2,050,000
1,583,334
1,490,303
1,488,589
1,135,625
850,000
835,143
5.47
4.09
3.88
3.03
2.61
2.59
2.55
1.94
1.55
1.32
1.27
0.98
0.92
0.92
0.70
0.53
0.52
126,919,988
161,320,702
78.68
100.00
Page 62 of 62