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Corporate Directory
Directors
Ren Hor Wong Executive Chairman, CEO
Jia Penny He Executive Director, CFO
Tarun Kanji Non-Executive Director
Corporate Office
Suite 502, 77 King Street
Sydney NSW 2000
Company Secretary
Solicitors
Anand Sundaraj
Whittens McKeough & Sundaraj Pty Ltd
Level 29, 201 Elizabeth Street
Sydney NSW 2000
Auditors
Share Registry
Crowe Horwath Sydney
Level 15, 1 O’Connell Street
Sydney NSW 2000
Link Market Services Limited
Level 12, 680 George Street
Sydney NSW 2000
Notice of Annual General Meeting
Corporate Governance Statement
Annual General Meeting of N1 Holdings Limited
will be held at:
Whittens McKeough & Sundaraj Pty Ltd
Level 29, 201 Elizabeth Street
Sydney NSW 2000
Time: 10:00 am
Date: 25 November 2016
Stock Listing
N1 Holdings Limited is listed on Australian
Securities Exchange (ASX) under the code
N1H.
N1 Holdings Limited and the board are committed
to achieving and demonstrating
the highest
standards of corporate governance. N1 Holdings
Limited has reviewed its corporate governance
practices against
the Corporate Governance
Principles and Recommendations (3rd edition)
published by
the ASX Corporate Governance
Council. The 2016 corporate governance statement
reflects the corporate governance practices in
place since listed. The 2016 corporate governance
statement was approved by the board on 18 March
2016. A description of
the Group's current
corporate governance practices is set out in the
Group's corporate governance statement which
can be viewed at: http://www.n1holdings.com.au/
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N1 HOLDINGS LIMITED
DIRECTORS’ REPORT
30 JUNE 2016
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Annual Report for the year ended 30 June 2016
CONTENTS
Directors’ Report
Auditor's Independence Declaration
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
Independent Auditor's Report
Shareholder Information
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7
18
19
20
21
22
23
47
48
50
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N1 HOLDINGS LIMITED
DIRECTORS’ REPORT
30 JUNE 2016
Directors’ Report
The directors of the Company (Directors) present their report on the consolidated entity consisting of the
Company and its controlled entities (Group) for the financial year ended 30 June 2016 (Directors’ Report). The
information in the Chairman’s Letter forms part of this Directors’ Report and is to be read in conjunction with the
following information:
Directors
The following persons were directors of N1 Holdings Limited during or since the end of the financial year up to
the date of this report:
Mr Ren Hor Wong (Executive Chairman, CEO, appointed 24 November 2015);
Ms Jia Penny He (Executive Director, CFO, appointed 24 November 2015); and
Mr Tarun Kanji (Non-executive Director, appointed 18 March 2016).
Company Secretary
Mr Anand Sundaraj (Company Secretary, appointed 24 November 2015)
Information relating to Directors and Company Secretary
Mr Ren Hor Wong (Executive Chairman, CEO)
Qualifications, experience and
special responsibilities
Mr Wong is the founder, Executive Chairman and Chief Executive
Officer of the Company.
Mr Wong has been responsible for developing the Company’s business
strategy and expanding its business into Asia Pacific.
Prior to establishing the Company, Mr Wong had, over a span of 6
years, applied his entrepreneurial and management skills in industries
ranging from courier services, printing services and real estate. He has
previously founded and successfully exited various businesses including
Copiko Printing, Sydneymove.com.au and Packers Unpackers.
Mr Wong is a licensed mortgage broker and fluent in both spoken and
written Mandarin and Cantonese.
Mr Wong conducts regular seminars and provides topical discussions
across Asia in relation to Australian property investments and financing.
Mr Wong has also published multiple guides and learner books for
release in China.
Mr Wong holds a Bachelor of Engineering with Honours from University
of New South Wales.
Interest in shares and options in
the Company (Shares and
Options, respectively)
50,000,000 Shares
Directorships held in other listed
entities during the three years
prior to the current year
None
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N1 HOLDINGS LIMITED
DIRECTORS’ REPORT
30 JUNE 2016
Ms Jia Penny He (Executive Director, CFO)
Qualifications, experience and
special responsibilities
Ms He is a Certified Practising Accountant and a licenced financial
adviser. She has over 10 years combined industry experience in
accounting, financial planning and mortgage broking.
Ms He joined the Group in May 2014 as the Accounting and Tax Adviser
and Principal Financial Planner. Ms He was subsequently appointed as
the Company’s Chief Financial Officer. Her current role within the
Company includes all financial management, tax and reporting functions
of the business.
Prior to joining the Company, Ms He served as an executive for Cabot
Square Chartered Accountants from July 2006 to May 2014.
Ms He holds a Master of Accounting degree from Macquarie University
and is also an ATO registered tax agent holding a Public Practice
Certificate.
Interest in Shares and Options
250,000 Shares and 750,000 Options
Directorships held in other listed
entities during the three years
prior to the current year
None
Mr Tarun Kanji (Non-Executive Director)
Qualifications, experience and
special responsibilities
Mr Kanji has nearly 25 years corporate and consulting experience
spanning the US, Europe, Asia, Australia and New Zealand. After
completing a Commerce Degree at Auckland University he spent over
10 years with
firms spanning corporate
advisory, valuation, finance, litigation support, recovery and audit
disciplines in New Zealand and Europe. Thereafter Mr Kanji held a
number of senior executive roles over 10 years with Fosters Group.
international accounting
The roles covered a range of disciplines including finance (as a CFO),
commercial management, business development, mergers &
acquisitions, governance, and strategic development roles.
Mr Kanji is currently the independent chairman of Tomizone Limited
(ASX:TOM). In addition, Mr Kanhi currently is involved in a number of
internationally
the commercial
globalisation of an evolutionary search technology software company,
focused on the US and Asian markets. He has held and holds a range of
governance roles:
focused ventures which
includes
Former Founding Chairman - Bank of India, (New Zealand)
Limited (a subsidiary of the Bank of India)
Member - Portfolio Governance Authority (a committee of New
Zealand’s department of Inland Revenue)
Chairman - Noske-Kaeser Rail & Vehicles New Zealand
Limited
Independent Director - FairWay Resolution Limited (a New
Zealand Crown-owned company)
Mr Kanji is a Fellow of The NZ Institute of Chartered Accountants
Australia and New Zealand as well as a member of the New Zealand
Institute of Directors, Certified Practicing Accountant of Australia, New
Zealand Institute of Directors, Australian Institute of Directors and New
Zealand Asian Leaders.
Interest in Shares and Options
1,000,000 Options
Directorships held in other listed
entities during the three years
prior to the current year
Independent Chairman – Tomizone Limited (ASX: TOM)
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DIRECTORS’ REPORT
30 JUNE 2016
Mr Anand Sundaraj (Company Secretary)
Qualifications, experience and
special responsibilities
Mr Sundaraj is a principal of Whittens McKeough & Sundaraj, a
commercial law firm based in Sydney. Prior to joining Whittens, Mr
Sundaraj worked at international law firms Allen & Overy, King &
Wood Mallesons and Herbert Smith Freehills, as well as for global
investment bank Credit Suisse.
Mr Sundaraj specialises in providing legal advice on mergers &
acquisitions and capital raisings for both publicly listed and privately held
entities. He also advises on funds management and general securities
law matters including ASX Listing Rules compliance.
(ASX:CAT), Tomizone Limited
Mr Sundaraj is currently the company secretary of Catapult Group
International Limited
(ASX:TOM),
Disruptive
Investment Group Limited (ASX:DVI), Reddam House
(operator of independent, co-educational, non-denominational schools)
and Lille Fro Foundation (an Australian-based charity which operates in
India).
Mr Sundaraj holds a Bachelor of Laws (with Honours) and a Bachelor of
Science from Monash University and is admitted as a solicitor of the
Supreme Courts of New South Wales and Victoria.
Interest in Shares and Options
10,000 Shares
Directorships held in other listed
entities during the three years
prior to the current year
None
Dividends paid or recommended
Dividends paid or declared for payment during the financial year are $nil (2015: $nil).
Changes in state of affairs
On 10 March 2016, N1 Holdings Limited issued 50,000,000 shares to Mr Ren Hor Wong and 6,043,750 to
convertible noteholders in exchange for 100% of the issued capital of N1 Loans Pty Ltd.
On 18 March 2016 N1 Holdings Limited issued 25,000,000 ordinary shares at $0.20 each to new Shareholders
who subscribed shares through the IPO of the company.
Principal Activities
The principal activities of the Group during the financial year was the provision of mortgage broking services to
customers.
Review of operations
There were no significant changes in the nature of the Group's principal activities during the financial year.
Review of operating results
During FY16, the Group generated revenue of $3.39m (FY15: $4.02m) delivering a net loss of $1.30m (compared
with a net profit of $0.56m for FY15).
The Company listed on ASX on 18 March 2016 and most of the expenses incurred post-IPO which have
contributed to the growth of business are yet to be evident on the Group’s financial results. This is due to the fact
that the Company’s post-IPO operational period accounts for a single quarter and that revenue receipt lead time
of three months is common across the mortgage broking industry.
Historically, the Company has engaged a number of contractors whose remuneration was based on commission
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DIRECTORS’ REPORT
30 JUNE 2016
to act as consultants. Since undertaking the IPO, the Group has initiated a transition into engaging consultants as
full-time employees – this is referred to as the “PAYG consultant” model. The Group’s reduction in revenue
during FY16 is a direct result of transitioning from commission-based consultants to PAYG consultants. However,
over the longer term, the Group expects the PAYG consultant model to improve the health of cash flow, client
retention rate and profitability of the business.
The full effect of this transition is yet to be seen due to the Group’s limited post-IPO operational period.
Revenues have also declined during FY16 due to the reduction in the recognised net present value (NPV) of the
estimated future trail commission. Net future trail commission recognised in FY16 is $427,000 (compared with
$919,002 for FY15). FY16 is the second year that N1 has adopted this revenue recognition policy and when the
existing trail book ages, its estimated amortisation increases, which results in a reduction in NPV of the future trail
commissions.
The Group is currently implementing a diversification strategy. Diversification revenue (DR), being revenue that is
not related to residential home loan broking, is growing in line with the Group’s strategic plan. Total DR during
FY16 was $121,056 (FY15: $51,498). This represents organic growth of 135%.
The decline in operating profit is predominantly due to the following factors:
— decrease in NPV of future trailing income movement of $492,000;
— decrease in upfront commission by $239,000;
— decrease in cost of sales by $256,000;
—
increase in employee costs by $788,000;
— employee share options and derivative costs on convertible notes totalling $307,000;
—
costs associated with listing & being listed totalling $53,000;
— marketing costs increased by $223,000 to attract new clients; and
—
rent & utilities increased by $101,000 for new premise to cover operational needs.
During the financial year ended 30 June 2016, the Company used cash and its assets in a form readily
convertible to cash that it received under its initial public offering in a way consistent with its business objectives.
Review of Financial Position
The net assets of the Group have increased from $688,710 as at 30 June 2015 to $5,216,244 in 2016. This
increase was mainly due to the proceeds from the IPO and associated share issuance which raised $5,000,000.
The Group has reduced its current financial liabilities by $775,378. The Group’s working capital, being current
assets less current liabilities, has improved from $118,846 in 2015 to $4,018,691 in 2016. The Directors believe
the Group is in a stable financial position to expand and grow their current operations.
Prospects for future financial years
The Group has initiated a digital plus retail strategy in the FY 2016 and expects to have its first retail presence in
Sydney in October 2016, complementing the Group’s web-based lead generation tools chengdai.com.au and
loanrobot.com.au and realty related mobile app Snailapp. This marks N1’s strategic move to integrate online and
offline capabilities, maximising market exposure, branding and efficient cross sell between N1 entities of
complimenting businesses.
The Group looks forward to the organic growth momentum and planned acquisitions. N1 aims to become an
integrated property and financial services firm with financial services specialisation in property and equipment
finance, commercial lending and business loans, as well as property services specialisation in property
management and residential sales. In broader terms, n1 offers more than just mortgage broking, it also includes
property-related funds and real estate lending – both in residential and commercial nature. The group becomes
an integrated one-stop shop that offers end to end value added services from funding of a development through
to sales of properties to investors, arranging finance for investors then management of investment properties for
investors.
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DIRECTORS’ REPORT
30 JUNE 2016
The Group will continue to execute its diversification strategy in the following ways:
— Products diversification
— Geographic diversification
— Language diversification
Events after the Reporting Period
On 1 September 2016, N1 Holdings Limited acquired a website (www.1crowd.com.au) owned by N1 Venture Pty
Ltd (ACN 602 937 851) at its cost of $50,000 and subsequently acquired N1 Venture at its issued capital of $100.
N1 Venture holds an Australian Financial Services Licence.
On 31 August 2016, N1 Realty Pty Ltd, a fully owned subsidiary of the Group, entered into an agreement to
acquire all the issued shares in Sydney Boutique Property Pty Ltd, a real estate agency business with a cash
consideration of $2,000,000. The acquisition has not been completed when this financial report is signed.
On 17 August 2016, N1 Loans Pty Ltd acquired loan trail book from Aura Private Wealth Pty Ltd (ACN 158 184
000) with total consideration of $336,661.50 excluding GST.
Other than above mentioned events, there has been no matters or events since the end of the financial year
which may significantly affect the operation of the Group, the results of those operations or the state of affairs of
the Group in the future financial years.
Environmental Issues
The Group‘s operations are not subject to significant environmental regulation under the law of the
Commonwealth and State.
Indemnifying Officers or Auditor
During or since the end of the financial year, the group has paid premiums to insure each of the directors (as
named above) against liabilities for costs and expenses incurred by the defending legal proceedings arising from
their conduct while acting in the capacity of directors of the group, other than conduct involving a wilful breach of
duty in relation to the group. The premiums for the directors amounted to $15,022.96. The group has not
indemnified the auditors.
Proceedings on Behalf of Company
No person has applied for leave of Court to bring proceedings on behalf of the company or intervene in any
proceedings to which the company is a party for the purpose of taking responsibility on behalf of the company for
all or any part of those proceedings.
The company was not a party to any such proceedings during the year.
Non-audit Services
The Board of Directors, in accordance with advice from the audit committee, 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 services disclosed below did not compromise the
external auditors’ independence for the following reasons:
—
—
all non-audit services are reviewed and approved prior to commencement to ensure they do not adversely
affect the integrity and objectivity of the auditor and
the nature of the services provided does not compromise the general principles relating to auditor
independence in accordance with APES110: Code of Ethics for Professional Accountants set by the
Accounting Professional and Ethical Standards Board.
The following fees were paid or payable to Crowe Horwath for non-audit services provided during the Year ended
30 June 2016:
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DIRECTORS’ REPORT
30 JUNE 2016
Taxation services
Due diligence investigations
Auditor’s independence declaration
$
7,700
12,000
19,700
The lead auditors’ independence declaration for the year ended 30 June 2016 has been received and can be
found following the Directors’ Report.
Options
As at 30 June 2016, the number of unissued ordinary shares in the Company under option are 6,962,500. For
details of Options issued to Directors and executives as remuneration, please refer to the Remuneration Report.
Meetings of Directors
During the financial year, five meetings of Directors were held. Attendance by each director during the year was
as follows:
Directors' meetings
Directors
Number eligible to attend
Number attended
Ren Hor Wong
Jia Penny He
Tarun Kanji
5
5
5
5
5
5
Remuneration policy
Remuneration Report
Remuneration Policy
The remuneration policy of the Company has been designed to align key management personnel (KMP)
objectives with shareholder and business objectives by providing a fixed remuneration component and offering
specific long-term incentives based on key performance in areas affecting the Group‘s financial results. The
Board believes the remuneration policy to be appropriate and effective in its ability to attract and retain the high-
quality KMP to run and manage the 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 Group is as follows:
— The remuneration policy is to be developed by the Board and the Board may seek advice on the policy
from independent external consultants at its discretion.
— All KMP receive a base salary (which is based on factors such as length of service and experience),
superannuation, fringe benefits options and performance incentives.
— Performance incentives are generally only paid once and conditional on key performance indicators
(KPIs) having been met.
—
Incentives paid in the form of Options or rights are intended to align the interests of the Directors and the
Company with those of the Shareholders. In this regard, KMP are prohibited from limiting the risk attached
to those instruments by use of derivatives or other means.
— The Board reviews KMP packages annually by reference to the Group’s performance, executive
performance and comparable information from industry sectors.
The performance of KMP is measured against criteria agreed annually with each executive and is based
predominantly on the forecast growth of the 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, and can recommend changes. Any change must be justified by
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DIRECTORS’ REPORT
30 JUNE 2016
reference to measurable performance criteria. The policy is designed to attract the highest calibre of executives
and reward them for performance results leading to long-term growth in Shareholder wealth.
KMP receive, at a minimum, the superannuation guarantee contribution required by law, which is currently 9.5%
of the individual's ordinary earnings. Some individuals, however, have chosen to sacrifice part of their salary to
increase payments towards superannuation.
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 practice, duties and accountability. Independent external advice is sought when
required. Fees that can be paid to a non-executive Director is contained in that Directors’ consultancy service
agreement.
Remuneration structure
There have been no significant changes after the Company’s listing on ASX. The table below summarises the
remuneration components of KPM of the Group.
Remuneration
component
Fixed
remuneration
Reward Type
Purpose
Link to performance
Salaries,
superannuation
and other fixed
benefits
To provide competitive fixed
remuneration set with
reference to role, market and
experience
Company and individual
performance are
considered during the
annual review
Short-term
incentive
Bonus paid in
cash
Long-term
incentive
Share options
Rewards executives for their
contribution to achievement
of Group outcome
Rewards executives for their
contribution to the creation of
shareholder value over the
longer term
Revenue of the Group
Vesting of the awards is
dependent on absolute
total Shareholder return
in addition to continuous
service vesting
conditions.
Performance-based Remuneration
The KPIs are set annually, with a certain level of consultation with KMP. The measures are specifically tailored to
the area each individual involved is in and has a level of control over. The KPIs target areas that 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
achieving the Group’s goals and shareholder value, before the KPIs are set for the following year.
In determining whether or not a KPI has been achieved, the Company bases the assessment on audited figures,
however, where the KPI involves comparison of the Group or a division within the Group to the market,
independent reports are obtained from other research organisations.
Relationship between remuneration policy and Company performance
The remuneration policy has been tailored to increase goal congruence between Shareholders, Directors and
executives. Two methods have been applied to achieve this aim, the first being a performance-based bonus (i.e.
based on KPI), and the second being the issue of options to the majority of Directors and executives to
encourage the alignment of personal and Shareholder interests. The Company believes this policy has been
effective in increasing shareholder value over the past years.
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Performance conditions linked to remuneration
The Group seeks to emphasise reward incentives for results and continued commitment to the Group through the
provision of various cash bonus reward schemes, specifically the incorporation of incentive payments based on
the achievement of revenue targets, return on equity ratios, and continued employment with the Group.
The performance-related proportions of remuneration (based on KPI targets) are included in the following table.
The objective of the reward schemes is to both reinforce the short and long-term goals of the Group and provide
a common interest between Management and Shareholders. There has been no alteration to the terms of the
bonuses paid since the grant date.
The satisfaction of the performance conditions is based on a review of the audited financial statements of the
Group and publicly available market indices and as such these figures reduce any risk of contention relating to
payment eligibility. The Board does not believe that performance conditions should include a comparison with
any other measures or factors external to the Group at this time.
The performance-based bonus schedule is detailed below, which has only available to executive Directors since
the listing date on 18 March 2016. No bonuses were paid to executive Directors during FY2016.
Minimum revenue achieved by the
Company for a financial year
Bonus
Ren Hor Wong
Bonus
Jia Penny He
$4.5 million
$5 million
$5.5 million +
$10,000
$16,000
$20,000
$5,000
$8,000
$10,000
Maximum achievable bonus is used in below calculation.
Fixed Remuneration
Remuneration linked to Performance
2016
2015
2016
2015
Directors and secretaries
Ren Hor Wong
93.75%
Jia Penny He
Tarun Kanji
92.3%
100%
Employment Details of members of KMP
100%
100%
100%
6.25%
7.7%
0%
0%
0%
0%
The following tables provide employment details of persons who were, during FY2016, members of KMP of the
Group. The table also illustrates the proportion of remuneration that was performance and non-performance
based.
Positions of KMPs and their employment details
Position Held
Contract
Duration
Employment
Type
Termination
Notice Period
Directors
Ren Hor Wong
Jia Penny He
Tarun Kanji
Chairman, CEO
Executive Director,
CFO
18/03/2016
- Ongoing
18/03/2016
- Ongoing
Permanent
6 months
Permanent
6 months
Independent
Director
18/03/2016
- Ongoing
Consultancy
agreement
3 months
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DIRECTORS’ REPORT
30 JUNE 2016
Key terms of KMP contract
Chief Executive Officer
— The CEO receives fixed remuneration of $300,000 per annum plus superannuation contributions under
the Superannuation Guarantee (Administration) Act 1992 (Cth) and the Superannuation Guarantee
Charge Act 1992 (Cth).
—
In addition to the fixed remuneration, the CEO will be entitled to a bonus on the following terms:
Minimum revenue achieved by the
Company for a financial year
Bonus
Ren Hor Wong
$4.5 million
$5 million
$5.5 million +
$10,000
$16,000
$20,000
— The Company provide a car benefit to the CEO.
— Fixed and incentive remuneration is reviewed and determined annually.
— Termination notice period is 6 months during the first 12 months and 3 months thereafter or without notice
in the event of breach of services agreement between Mr Wong and the Company or serious
misconduct.
— Restraint period being up to 24 months.
Chief Financial Officer
— The CFO receives fixed remuneration of $120,000 per annum plus superannuation contributions under
the Superannuation Guarantee (Administration) Act 1992 (Cth) and the Superannuation Guarantee
Charge Act 1992 (Cth).
—
In addition to the fixed remuneration, the CFO will be entitled to a bonus on the following terms:
Minimum revenue achieved by the
Company for a financial year
Bonus
Jia Penny He
$4.5 million
$5 million
$5.5 million +
$5,000
$8,000
$10,000
— Fixed and incentive remuneration will be reviewed and determined annually.
— Termination notice period is 6 months during the first 12 months and 3 months thereafter or without notice
in the event of breach of services agreement between Ms He and the Company or serious misconduct.
— Restraint period being up to 24 months.
Non-Executive Director
— The remuneration (Service Fee) of the Non-Executive Director is $40,000 per annum for the first year of
service commencing 18 March 2016 and $59,000 per annum for every year thereafter.
— 1,000,000 options exercisable at $0.20 issued on 18 March 2016 expiring 2 years after the date of issue.
— The Service Fee will be reviewed and determined annually.
— Termination notice period is 3 months or 1 month in the event of breach of services agreement between
the relevant Non-Executive Director and the Company or serious misconduct.
— Restraint period being up to 24 months.
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Remuneration of KMP
2016
Short term employee benefits
Post-employment
benefits
Salaries
Bonus Other
Superannuation
(note 1)
Long term
employee
benefits
Long service
leave
Share based
payments
Total
Options
Directors
Ren Hor
Wong
Jia Penny
He
Tarun Kanji
$145,451
$105,453
$27,526
-
-
-
$3,783
$13,713
-
-
$10,044
-
$889
$491
-
-
$163,836
$7,445
$123,433
$38,500
$66,026
2015
Short term employee benefits
Post-employment
benefits
Salaries
Bonus Other
Superannuation
Long term
employee
benefits
Long service
leave
Share based
payments
Total
Options
Directors
Ren Hor
Wong
Jia Penny
He
Tarun Kanji
$36,918
$44,600
-
-
-
-
-
-
-
$3,325
$3,958
-
$46
$77
-
-
-
-
$40,289
$48,635
-
Note1: The Company provides car benefits to the CEO.
Options and rights granted as remuneration
The terms and conditions relating to Options granted as remuneration during the year to KMP are as follows:
2016
Number of
Options
beginning of
the year
Granted
No.
Exercised
during the
year
Lapsed
during the
year
Number of
options at the
ending of the
year
Vested
Unvested
Ren Hor
Wong
Jia Penny
He
Tarun
Kanji
-
-
-
-
750,000
1,000,000
-
-
-
-
-
-
-
750,000
-
-
-
750,000
1,000,000
1,000,000
-
2015: No Options were granted or outstanding in 2015.
The fair value of Options granted as remuneration and as shown in the above table has been determined in
accordance with Australian accounting standards and will be recognised as an expense over the relevant vesting
period to the extent that conditions for vesting are satisfied.
Description of Options/rights issued as remuneration
Details of the Options granted as remuneration to those KMP and executives listed in the previous table are as
follows:
Tranche Grant date
Number of
options
granted
Grant Value
Exercising
Price
Vesting date
Reason for
grant
Jia Penny
He
1
14/12/2015
750,000
$150,000
$0.2
14/12/2018
Tarun Kanji
2
18/03/2016
1,000,000
$200,000
$0.2
18/03/2016
Employee
share option
Director
option
Page | 16
For personal use only
N1 HOLDINGS LIMITED
DIRECTORS’ REPORT
30 JUNE 2016
Tranche
Fair value per option at
Granting date
Vesting conditions
Jia Penny He
Tarun Kanji
1
2
$0.0544
$0.0385
Continuous employment with the Group
from 14/12/2015 to 14/12/2018
Vested
Option values at grant date were determined by applying the Binomial Approximation valuation methodology.
KMP shareholdings
The number of ordinary shares in the Company held by each KMP of the Group during the financial year is as
follows:
2016
Ren Hor Wong
(Note 1)
Jia Penny He
(Note 2)
Tarun Kanji
Number of
Shares
beginning
of the year
100
-
-
Received as
remuneration
during year
Received on
exercising
Options
Disposed
Number of
Shares at the
end of the year
-
-
-
-
-
-
-
-
-
50,000,000
250,000
-
2015: The Company was not incorporated in 2015.
Note 1: Mr Ren Hor Wong received 50,000,000 Shares in the Company in exchange of his shares in N1 Loans during the IPO.
Note 2: Ms Jia Penny He was issued 187,500 Shares from settlement of convertible notes and acquired 62,500 Shares during
the IPO.
Other equity-related KMP transactions
There have been no other transactions involving equity instruments apart from those described in the tables
above relating to Options, rights and Shares.
Loans to KMP
The Group has made an interest free short-term loan to an associated entity of Ren Hor Wong. The total
outstanding balance of the loan as at 30 June 2016 was $50,000. The loan had been repaid at the time of
reporting.
On behalf of the Board
Ren Hor Wong
Executive Chairman and CEO
29 September 2016
Sydney
Page | 17
For personal use only
N1 HOLDINGS LIMITED
AUDITOR’S INDEPENDENCE DECLARATION
30 JUNE 2016
Page | 18
For personal use only
N1 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
30 JUNE 2016
For the year ended 30 June 2016
Continuing operations
Revenue
Consulting and referral fees
Gross profit
Other income
Employee cost
IT and technology
Sales and marketing
Rent and utilities
Professional fee
Office and administrative expense
Finance cost
Travel cost
Depreciation and amortisation
Other operation cost
Profit/(Loss) before income tax
Income tax benefit/(expense)
Net profit/(loss) from continuing operations
Other comprehensive income
Total comprehensive income/(loss) for the year
Earnings per share
Basic earnings per share
Diluted earnings per share
2016
$
2015
$
(restated)
3,387,683
4,017,760
(1,463,949)
(1,720,237)
1,923,734
2,297,523
70,829
35,318
(1,834,280)
(1,046,470)
(59,034)
(301,658)
(3,229)
(78,609)
(254,099)
(143,003)
(184,782)
(140,772)
(282,873)
(124,754)
(80,887)
(26,700)
(1,295,276)
(10,124)
(1,305,400)
-
(37,143)
(38,507)
(12,540)
(74,122)
(57,829)
(26,425)
814,964
(255,669)
559,295
-
(1,305,400)
559,295
cents
(5)
(5)
cents
559,295
559,295
Note
4
4
5
7
7
The accompanying notes form part of these financial statements.
Page | 19
For personal use only
N1 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
30 JUNE 2016
As at 30 June 2016
2016
$
2015
$
2014
$
Note
(restated)
(restated)
ASSETS
CURRENT ASSETS
Cash and cash equivalents
Trade and other receivables
Other financial assets
TOTAL CURRENT ASSETS
NON-CURRENT ASSETS
Trade and other receivables
Other financial assets
Property, plant and equipment
Deferred tax assets
Intangible assets
TOTAL NON-CURRENT ASSETS
TOTAL ASSETS
LIABILITIES
CURRENT LIABILITIES
Trade and other payables
Other financial liabilities
Current tax liabilities
Provisions
TOTAL CURRENT LIABILITIES
NON-CURRENT LIABILITIES
Other financial liabilities
Deferred tax liabilities
Provisions
TOTAL NON-CURRENT LIABILITIES
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained earnings
TOTAL EQUITY
8
9
10
9
10
11
15
12
13
14
15
16
14
15
16
17
17
The accompanying notes form part of these financial statements.
3,856,946
1,060,440
94,657
5,012,043
949,010
195,097
182,508
349,246
155,750
1,831,611
647,857
854,167
205,631
1,707,655
716,000
28,500
131,320
64,624
68,599
1,009,043
59,805
409,309
-
469,114
117,327
33,635
166,991
16,635
1,714
336,302
6,843,654
2,716,698
805,416
462,769
33,698
-
496,885
993,352
149,448
477,443
7,167
634,058
343,216
809,076
61,874
374,643
1,588,809
106,029
331,200
1,950
439,179
1,627,410
5,216,244
2,027,988
688,710
5,738,586
94,448
(616,790)
5,216,244
100
-
688,610
688,710
228,611
59,456
27,359
166,111
481,537
137,293
55,499
1,672
194,464
676,001
129,415
100
-
129,315
129,415
Page | 20
For personal use only
N1 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
30 JUNE 2016
For the year ended 30 June 2016
Share
Capital
$
Option
Reserve
$
Retained
Earning
$
Note
Balance at 1 July2014
Opening balance adjustment
2
Restated balance at 1 July 2014
Comprehensive income
Profit for the year
Total comprehensive income
for the year
Balance at 30 June2015 / 1 July
2015
Comprehensive income
Profit/(loss) for the year
Total comprehensive income
for the year
Transactions with owners, in their
capacity as owners, and other
transfers
Shares issued during the year
Total transactions with owners
and other transfers
Share based payment
Balance at 30 June2016
100
-
100
-
-
100
-
-
5,738,486
5,738,486
-
5,738,586
-
-
-
-
-
-
-
-
-
-
94,448
94,448
The accompanying notes form part of these financial statements.
Total
$
(84)
129,499
129,415
(184)
129,499
129,315
559,295
559,295
559,295
559,295
688,610
688,710
(1,305,400)
(1,305,400)
(1,305,400)
(1,305,400)
-
-
-
5,738,486
5,738,486
94,448
(616,790)
5,216,244
Page | 21
For personal use only
N1 HOLDINGS LIMITED
CONSOLIDATED STATEMENT OF CASH FLOWS
30 JUNE 2016
For the year ended 30 June 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Interest received
Payments to suppliers and employees
Income tax paid
Note
2016
$
2015
$
3,113,072
26,359
3,512,879
(8,622)
(4,378,927)
(3,380,081)
(74,160)
Net cash provided by (used in) operating activities
20
(1,313,656)
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property, plant and equipment
Purchase of Intangible assets
Loans to Related Party
Loans Recovered
Cash Received on Disposal of plant and equipment
Net cash provided by /(used in) investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of shares
Cash paid for capital raising
Proceeds from borrowings
Loans from related parties
Finance liability repaid
Net cash provided by (used in) financing activities
Net increase in cash held
Cash and cash equivalents at beginning of financial year
Cash and cash equivalents at end of financial year
8
The accompanying notes form part of these financial statements.
(47,241)
(131,578)
(41,000)
162,996
105,419
48,596
5,000,000
(618,768)
200,000
-
(107,083)
4,474,149
3,209,089
647,857
3,856,946
6,559
130,735
(9,743)
(79,300)
-
-
-
(89,043)
-
767,000
(189,376)
(31,264)
546,360
588,052
59,805
647,857
Page | 22
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
These consolidated financial statements and notes represent those of N1 Holdings Limited and its controlled
entities (the “consolidated group” or “group”).
1.
Summary of significant accounting policies
Basis of preparation
These general purpose financial statements have been prepared in accordance with the Corporations Act, the
Australian Accounting Standards and Interpretations of the Australian Accounting Standards Board and the
International Financial Reporting Standards as issued by the International Accounting Standards Board. The
Group is a for-profit entity for financial reporting purposes under the Australian Accounting Standards. Material
accounting policies adopted in the preparation of these financial statements are presented below and have been
consistently applied unless stated otherwise. The functional presentation currency is Australian dollars rounded to
nearest dollar.
Except for cash flow information, the financial statements have been prepared on an accruals basis and are
based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current
assets, financial assets and financial liabilities.
(a)
Principles of consolidation
The consolidated financial statements incorporate all of the assets, liabilities and results of the Company and all
of the subsidiaries. Subsidiaries are entities that the Company controls. The Company 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 23.
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. Inter-company 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.
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 obtained, at which point the fair value of the identifiable assets acquired and liabilities (including
contingent liabilities) assumed is recognised (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 is classified as an asset or liability and is remeasured 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
the 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.
The acquisition of a business may result in the recognition of goodwill or a gain from a bargain purchase.
Group reorganisation
The Company was incorporated on 24 November 2015. On 10 March 2016, the Company issued 50,000,000
shares to Mr Ren Hor Wong (sole shareholder of both the Company and N1 Loans Pty Ltd) and 6,043,750 shares
to convertible noteholders in exchange for 100% of the issued capital of N1 Loans in order to list the Company on
ASX. This Group reorganisation did not meet the definition of a business combination in AASB 3 Business
Combination. As a result, the financial statements are a continuation of N1 Loans and the predecessor
accounting has been used for the Group reorganisation as follows:
—
—
—
—
Retained earnings and other equity balances at acquisition date are those of N1 Loans.
The equity structure in the financial statements (the number of equity instrument issued) at the
date of the acquisition reflects the equity structure of the Company, including Shares issued to
effect the acquisition of N1 Loans.
The result for FY2016 comprises the consolidated results for the year of N1 Loans, the result of
the Company from 24 November 2015 to 30 June 2016 and other controlled entities from their
incorporation dates during the year to 30 June 2016.
The comparative figures represent the results and balances of N1 Loans only.
Page | 23
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
(b)
Income Tax
The income tax expense (income) for the year comprises current income tax expense (income) and deferred tax
expense (income).
Current income tax expense charged to profit or loss is the tax payable on taxable income. Current tax liabilities
(assets) are measured at the amounts expected to be paid to (recovered from) the relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax asset and deferred tax liability balances during
the year as well as unused tax losses.
Current and deferred income tax expense (income) is charged or credited outside profit or loss when the tax
relates to items that are recognised outside profit or loss.
Except for business combinations, no deferred income tax is recognised from the initial recognition of an asset or
liability, where there is no effect on accounting or taxable profit or loss.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply to the period when the
asset is realized or the liability is settled and their measurement also reflects the manner in which Management
expects to recover or settle the carrying amount of the related asset or liability.
Deferred tax assets relating to temporary differences and unused tax losses are recognised only to the extent that
it is probable that future taxable profit will be available against which the benefits of the deferred tax asset can be
utilised.
Where temporary differences exist in relation to investments in subsidiaries, deferred tax assets and liabilities are
not recognised where the timing of the reversal of the temporary difference can be controlled and it is not
probable that the reversal will occur in the foreseeable future.
(c)
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 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 maximum 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.
The fair value of liabilities and the entity’s own equity instruments (excluding those related to share-based
payment arrangements) may be valued, where there is no observable market price in relation to the transfer of
such financial instruments, by reference to observable market information where such instruments are held as
assets. Where this information is not available, other valuation techniques are adopted and, where significant, are
detailed in the respective note to the financial statements.
(d)
Plant and Equipment
Plant and equipment is measured at cost less accumulated depreciation and any accumulated impairment. In the
event that the carrying amount of plant and equipment is greater than the estimated recoverable amount, the
carrying amount is written down immediately to the estimated recoverable amount. Impairment losses are
recognised in profit or loss.
Page | 24
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
Depreciation
The depreciable amount of all plant and equipment and is depreciated on a straight-line basis over the asset’s
useful life 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.
Currently the depreciation rate is in the range of 10% to 20%.
(e)
Finance Leases
Leases of fixed assets, where substantially all the risks and benefits incidental to the ownership of the asset (but
not the legal ownership) are transferred to entities in the consolidated group, are classified as finance leases.
Finance leases are capitalised by recognising an asset and a liability at the lower of the amounts equal to the fair
value of the leased property or the present value of the minimum lease payments, including any guaranteed
residual values. Lease payments are allocated between the reduction of the lease liability and
the lease interest expense for the period.
(f)
Financial instruments
Recognition and initial measurement
Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual
provisions to the instrument. For financial assets, this is equivalent to the date that the entity commits itself to
either the purchase or sale of the asset (i.e. trade date accounting is adopted).
Financial instruments are initially measured at fair value plus transactions costs except where the instrument is
classified at fair value through profit or loss in which case transaction costs are expensed to profit or loss
immediately.
Classification and subsequent measurement
Financial instruments are subsequently measured at fair value, amortised cost using the effective interest
method, or cost.
Amortised cost is calculated as the amount at which the financial asset or financial liability is measured at initial
recognition less principal repayments and any reduction for impairment, and adjusted for any cumulative
amortisation of the difference between that initial amount and the maturity amount calculated using the effective
interest method.
The effective interest method is used to allocate interest income or interest expense over the relevant period and
is equivalent to the rate that discounts estimated future cash payments or receipts (including fees, transaction
costs and other premiums or discounts) over the expected life (or when this cannot be reliably predicted, the
contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability.
Revisions to expected future net cash flows will necessitate an adjustment to the carrying amount with a
consequential recognition of an income or expense item in profit or loss.
(i)
Financial assets at fair value through profit or loss
Financial assets are classified at fair value through profit or loss when they are held for trading for the purpose of
short-term profit taking, derivatives not held for hedging purposes, or when they are designated as such to avoid
an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by
KMP on a fair value basis in accordance with a documented risk management or investment strategy. Such
assets are subsequently measured at fair value with changes in carrying amount being included in profit or loss.
(ii)
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not
quoted in an active market and are subsequently measured at amortised cost.
Gains or losses are recognised in profit or loss through the amortisation process and when the financial asset is
derecognised.
(iii) Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or
determinable payments, and it is the Group’s intention to hold these investments to maturity. They are
subsequently measured at amortised cost.
Gains or losses are recognised in profit or loss through the amortisation process and when the financial asset is
derecognised.
Page | 25
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
(iv) Available-for-sale investments
Available-for-sale investments are non-derivative financial assets that are either not capable of being classified
into other categories of financial assets due to their nature or they are designated as such by Management. They
comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or
determinable payments.
They are subsequently measured at fair value with any re-measurements other than impairment losses
and foreign exchange gains and losses recognised in other comprehensive income. When the financial asset is
de recognised, the cumulative gain or loss pertaining to that asset previously recognised in other comprehensive
income is reclassified into profit or loss.
(v)
Financial liabilities
Non-derivative financial liabilities other than financial guarantees are subsequently measured at amortised cost.
Gains or losses are recognised in profit or loss through the amortisation process and when the financial liability is
de recognised.
Impairment
A financial asset (or a group of financial assets) is deemed to be impaired if, and only if, there is objective
evidence of impairment as a result of one or more events (a loss event) having occurred, which has an impact on
the estimated future cash flows of the financial asset(s).
In the case of available-for-sale financial assets, a significant or prolonged decline in the market value of the
instrument is considered to constitute a loss event. Impairment losses are recognised in profit or loss
immediately. Also, any cumulative decline in fair value previously recognised in other comprehensive income is
reclassified into profit or loss at this point.
In the case of financial assets carried at amortised cost, loss events may include: indications that the debtors or a
group of debtors are experiencing significant financial difficulty, default or delinquency in interest or principal
payments; indications that they will enter bankruptcy or other financial reorganisation; and changes in arrears or
economic conditions that correlate with defaults.
For financial assets carried at amortised cost (including loans and receivables), a separate allowance account is
used to reduce the carrying amount of financial assets impaired by credit losses. After having taken all possible
measures of recovery, if Management establishes that the carrying amount cannot be recovered by any means,
at that point the written-off amounts are charged to the allowance account or the carrying amount of impaired
financial assets is reduced directly if no impairment amount was previously recognised in the allowance account.
When the terms of financial assets that would otherwise have been past due or impaired have been renegotiated,
the Group recognises the impairment for such financial assets by taking into account the original terms as if the
terms have not been renegotiated so that the loss events that have occurred are duly considered.
Derecognition
Financial assets are derecognised when the contractual rights to receipt of cash flows expire or the asset is
transferred to another party where by the entity no longer has any significant continuing involvement in the risks
and benefits associated with the asset. Financial liabilities are derecognised when the related obligations are
discharged, cancelled or have expired. The difference between the carrying amount of the financial liability
extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-
cash assets or liabilities assumed, is recognised in profit or loss.
(g)
Impairment of assets
At the end of each reporting period, the Group assesses whether there is any indication that an asset may be
impaired. The assessment will include the consideration of external and internal sources of information. If such an
indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the
asset, being the higher of the asset’ s fair value less costs of disposal and value in use, to the asset’ s carrying
amount. Any excess of the asset’ s carrying amount over its recoverable amount is recognised immediately in
profit or loss, unless the asset is carried at a revalued amount in accordance with another standard (e.g. in
accordance with the revaluation model in AASB 116: Property, Plant and Equipment). Any impairment loss of
revalued asset is treated as a revaluation decrease in accordance with that other standard.
Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the
recoverable amount of the cash-generating unit to which the asset belongs.
Impairment testing is performed annually for intangible assets with indefinite lives and intangible assets not yet
available for use.
Page | 26
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
(h)
Intangibles other than goodwill
Website and IT System
Acquired website and computer software licences are capitalised on the basis of costs incurred to acquire them.
These costs are amortised over their estimated useful lives. Costs associated with maintaining computer software
programs are recognised as an expense as incurred.
Amortisation
Amortisation is recognised in profit and loss on a straight line basis over the estimated useful life of the intangible
assets from the date that they are suitable for use. The estimated useful life of intangible assets is as follows:
— Website and IT system and software: 5 years
(i)
Foreign currency transactions and balances
Functional and presentation currency
The functional currency of each of the Group’s entities is measured using the currency of the primary economic
environment in which that entity operates. The consolidated financial statements are presented in Australian
dollars which is the Company’s functional currency.
Transaction and balances
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 at the year-end exchange rate. Non-
monetary items measured at historical cost continue to be carried at the exchange rate at the date of the
transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair
values were determined.
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.
Exchange differences arising on the translation of non- monetary items are recognised directly in other
comprehensive income to the maximum extent that the underlying gain or loss can be recognised in other
comprehensive income, otherwise the exchange difference is recognised in the profit or loss.
(j)
Employee benefits
Retirement benefit obligations
All employees of the Group other than those that receive defined benefit entitlements receive defined contribution
superannuation entitlements, for which the Group pays the fixed superannuation guarantee contribution (currently
9.5% of the employee’s average ordinary salary) to the employee‘s superannuation fund of choice. All
contributions in respect of employees’ defined contribution entitlements are recognised as an expense when they
become payable. The Group’ s obligation with respect to employees’ defined contribution entitlements is limited to
its obligations for any unpaid superannuation guarantee contributions at the end of the reporting period. All
obligations for unpaid superannuation guarantee contributions are remeasured at the (undiscounted) amounts
expected to be paid when the obligation is settled and are presented as current liabilities in the Group’ s
statement of financial position.
Equity-settled compensation
The Group operates an employee share and option plan. Share-based payments to employees are remeasured
at the fair value of the instruments issued and amortised over the vesting periods. Share-based payments to non-
employees are remeasured at the fair value of goods or services received or the fair value of the equity
instruments issued, if it is determined that the fair value of the goods or services cannot be reliably measured,
and are recorded at the date that the goods or services are received. The corresponding amount is recorded to
the option reserve. The fair value of Options is determined using the Binomial Approximation valuation
methodology. The number of Shares and Options expected to vest is reviewed and adjusted at the end of each
reporting period such that the amount recognised for services received as consideration for the equity
instruments granted is based on the number of equity instruments that eventually vest.
Page | 27
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
(k)
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 ATO. Receivables and payables are stated inclusive of the amount of GST
receivable or payable. The net amount of GST recoverable from, or payable to, the 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.
(l)
Comparative figures
When required by accounting standards, comparative figures have been adjusted to conform to changes in
presentation for the current financial year.
Where the Group retrospectively applies an accounting policy, makes a retrospective restatement or reclassifies
items in its financial statements, an additional (third) statement of financial position as at the beginning of the
preceding period in addition to the minimum comparative financial statement is presented.
(m) New and amended accounting policies adopted by the Group
The Group has adopted all of the new and revised standards and interpretations, including amendments to the
existing standards issued by the Australian accounting standards Board (the AASB) that are relevant to their
operation and effective for the current reporting period. The adoption of these amendments and new standards
has not resulted in any significant changes to the Group’ s accounting policies or any significant effect on the
measurement or disclosure of the amounts reported for the current or prior reporting period.
(n)
Critical accounting estimates and judgements
The Directors evaluations, estimates and judgments that are incorporated into the financial statements are
based on historical knowledge and the best available current information. These estimates assume a
reasonable expectation of future events and are based on current trends and economic data, obtained both
externally and within the Group.
Measurement of Share base payments
The share base payment is measured at fair value at the grant date of the Options. The fair value at grant date
is independently determined using an adjusted form of the Binomial Approximation valuation methodology that
takes into account the exercise price, the term of the Option, the impact of dilution (where material), the Share
price at grant date and expected price volatility of the underlying Share, the expected dividend yield, the risk
free interest rate for the term of the Option and the correlations and volatilities of the peer group companies.
NPV of trailing commission receivable
The Group receives trailing commissions from lenders on settled loans over the life of the loan based on the
loan book balance outstanding. The Group is entitled to the trailing commissions without having to perform
further services. The Group also makes trailing commission payments to commission based consultants when
trailing commission is received from lenders. The fair value of trailing commissions receivable from lenders and
the corresponding amounts payable to the commission based consultants is determined by using a discounted
cash flow valuation. These calculations require the use of assumptions which are determined by Management
with the assistance of external actuaries. Key assumption used and the related sensitivity test have been given
in note 25 in this financial report.
Clawback – Receivable and Provision
There is potential for origination commissions to be clawed back by lenders after loans have settled. When
commissions are clawed back by lenders, the Group will claw back the corresponding commissions from its
agents at the same time. As a result, the Group assesses the probability of the clawbacks and determines both
provision for clawbacks (note 16) and clawback receivable from agents (note 9) at each reporting date. The
provision is based on the historical record of actual clawback and recovery. The probability used in estimate of
the clawbacks is 16.7% (2015: 10.2%)
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
Taxation
The income tax expense or credit for the period is the tax payable on the current period’s taxable income based
on the applicable income tax rate for each jurisdiction adjusted by changes in deferred tax assets and liabilities
attributable to temporary differences and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the
end of the reporting period. Management periodically evaluates positions taken in tax returns with respect to
situations in which applicable tax regulations are subject to interpretation. Management establishes provisions
where appropriate on the basis of amounts expected to be paid to tax authorities.
Deferred income tax is provided in full, 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. However,
deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill. Deferred income tax
is also not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects neither accounting nor taxable profit or loss.
Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by
the end of the reporting period 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 only if it is probable that future taxable amounts will be available to utilise
those temporary differences and losses.
(o)
New accounting standards for application in future periods
Accounting standards 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
discussed below:
AASB 9: financial instruments and associated amending standards (applicable to annual reporting periods
beginning on or after 1January 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 financial assets, simplifications to the accounting of embedded derivatives, upfront accounting for expected
credit loss, and their revocable 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 Company 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.
The directors anticipate that the adoption of AASB 9 will have no significant impact on the Group’ s financial
instruments.
AASB 15: revenue from Contracts with customers (applicable to annual reporting periods beginning on or after 1
January 2018, as deferred by AASB 2015-8: Amendments to Australian accounting standards – effective Date of
AASB 15).
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 exchange s 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 provided the following five-step process:
— 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.
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NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
1.
Summary of significant accounting policies (continued)
The transitional provisions of this standard permit an entity to either: restate the contracts that existed in each
prior period presented per AASB 108: accounting Policies, changes in accounting estimates and Errors (subject
to certain practical expedients in AASB 15); or recognise the cumulative effect of retrospective application to
incomplete contracts on the date of initial application. There are also enhanced disclosure requirements regarding
revenue.
Whilst the Directors anticipate that the adoption of AASB 15 may have an impact on the Group’s financial
statements, the Directors consider that it is impracticable at this stage to provide a reasonable estimate of such
impact.
AASB 16: leases (applicable to annual reporting periods beginning on or after 1 January2019).
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 operating or finance leases.
The main changes introduced by the new standard include:
— recognition of a 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);
— depreciation of 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;
— variable lease payments that depend on an index or a rate are included in the initial measurement of the
lease liability using the index or rate at the commencement date;
— by applying a practical expedient, a lessee is permitted to elect not to separate non- lease components
and instead account for all components of a lease; and
— additional disclosure requirements.
The transitional provisions of AASB 16 allow a lessee to either retrospectively apply the standard to comparatives
in line with AASB 108or recognise the cumulative effect of retrospective application as an adjustment to opening
equity on the date of initial application.
Although the Directors anticipate that the adoption of AASB 16 will impact the Group’s financial statements, it is
impracticable at this stage to provide a reasonable estimate of such impact.
AASB 2014-3: Amendments to Australian accounting standards – accounting for acquisitions of interests in Joint
Operations (applicable to annual reporting periods beginning on or after 1 January2016).
This standard amends AASB 11: Joint arrangements to require the acquirer of an interest (both initial and
additional) in a joint operation in which the activity constitutes a business, as defined in AASB 3: business
combinations, to apply all of the principles on business combinations accounting in AASB 3 and other Australian
accounting standards except for those principles that conflict with the guidance in AASB 11; and disclose the
information required by AASB 3 and other Australian accounting standards for business combinations.
The application of AASB 2014-3 will result in a change in accounting policies for the above described
transactions, which were previously accounted for as acquisitions of assets rather than applying the acquisition
method per AASB 3.
The transitional provisions require that the standard should be applied prospectively to acquisitions of interests in
joint operations occurring on or after 1 January 2016. As at 30 June 2016, Management is not aw are of the
existence of any such arrangements that would impact the financial statements of the entity going forward and as
such is not capable of provided a reasonable estimate at this stage of the impact on initial application of AASB
2014-3.
AASB 2014-10: Amendments to Australian accounting standards – Sale or contribution of assets between an
Investor and its Associate or joint venture (applicable to annual reporting periods beginning on or after 1 January
2018, as deferred by AASB 2015-10: Amendments to Australian accounting standards – effective Date of
Amendments to AASB 10 and AASB 128).
This standard amends AASB 10: consolidated financial statements with regards to a parent company losing
control over a subsidiary that is not a " business " as defined in AASB 3 to an associate or joint venture, and
requires that:
— A gain or loss (including any amounts in other comprehensive income (OCI)) be recognised only to the
extent of the un related invest or’ s interest in that associate or joint venture;
— The remaining gain or loss be eliminated against the carrying amount of the investment in that associate
or joint venture; and
— Any gain or loss from remeasuring the remaining investment in the former subsidiaries at fair value also be
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
recognised only to the extent of the joint venture. The remaining gain or loss should be eliminated against
the carrying amount of un related invest or’ s interest in the associate or the remaining investment.
The application of AASB 2014-10 will result in a change in accounting policies for transactions of loss of control
over subsidiaries (involving an associate or joint venture) that are businesses per AASB 3 for which gains or
losses were previously recognised only to the extent of the unrelated investor’s interest.
The transitional provisions require that the standard should be applied prospectively to sales or contributions of
subsidiaries to associates or joint ventures occurring on or after 1 January 2018. Although the Directors anticipate
that the adoption of AASB 2014-10 may have an impact on the Group’s financial statements, it is impracticable at
this stage to provide a reasonable estimate of such impact.
2.
Change of accounting policies
The Group has changed the accounting policy in relation to the recognition of its trailing income receivable during
FY2016. The Group started to recognise the NPV of all the future trailing income as an asset on the balance
sheet when the entitlement is established in accordance with Australian Accounting Standards. As a result of the
change, each of the affected financial statement line items have been restated for the prior periods as follows.
Balance Sheet
(extract)
30 June
2014
Increase
30 June 2014
(restated)
30 June
2015
Increase
30 June 2015
(restated)
341,638
184,998
526,636
466,167
1,104,000
1,570,167
Trade and other
receivable
Deferred tax liability
Net assets
Retained earning
Total equity
-
(84)
(184)
(84)
55,499
129,499
129,499
129,499
55,499
129,415
129,315
129,415
-
(84,090)
(84,190)
(84,090)
331,200
772,800
772,800
772,800
Profit or Loss and other comprehensive
income(extract)
2015
Profit Increase
Revenue
Profit/(loss) before tax
Income tax expense/(benefit)
Profit/(loss) after tax
3.
Segment Information
3,130,158
(104,038)
(20,032)
(84,006)
919,002
919,002
275,701
643,301
The Group has not identified any reporting segments under AASB 8 during the current and prior financial year.
4.
Revenue and Other Income
(a)
Revenue
Origination commission
Fair value of Trail commission
Other service
(b)
Other income
Bank Interest
Other
Note
2
Consolidated Group
2015
(restated)
2016
2,945,367
3,086,335
427,000
15,316
919,002
12,423
3,387,683
4,017,760
26,359
44,470
70,829
3,918
31,400
35,318
Page | 31
331,200
688,710
688,610
688,710
2015
(restated)
4,049,160
814,964
255,669
559,295
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
Revenue is measured at the fair value of the consideration received or receivable after taking into account any
trade discounts and volume rebates allowed. When the inflow of consideration is deferred it is treated as the
provision of financing and is discounted at a rate of interest that is generally accepted in the market for similar
arrangements. The difference between the amount initially recognised and the amount ultimately received is
interest revenue.
Commission Revenue
The Group provided loan origination services and receives origination commission on the settlement of loans.
Additionally, the lender normally pays a trailing commission over the life of the loan. Commission revenue is
recognised as follows:
(i)
Origination commission
Origination commission are recognised upon the loan being settled.
(ii)
Trailing commissions
The Group receives trailing commissions from lenders on loans they have settled that were originated by the
Group. The trailing commissions are received over the life of the loans based on the individual loan balance
outstanding. On initial recognition, trailing commission revenue and receivables are recognised at fair value,
being the expected future trailing commission receivables discounted to their net present value.
Subsequent to initial recognition, the trailing commission asset are measured at amortised cost. The carrying
amount of the trailing commission asset are adjusted to reflect net present value of revised estimated future cash
flows at the original effective interest rate. The resulting adjustment is recognised as income or expense in the
consolidated statement of profit or loss and other comprehensive income.
(iii) Render of other service
Revenue from contracts to provide other services is recognised by reference to the stage of completion of the
contracts.
5.
Tax expense
(a)
The components of tax expense (income)
comprise:
Current tax
Deferred tax
Note
15
(b)
The prima facie tax on profit from ordinary
activities before income tax is reconciled to
income tax as follows:
Profit/(loss) before income tax
At 30% (2015:30%)
Tax effect of:
Permanent differences
Net deferred tax as a result of IPO impact
Tax to equity
Income tax (benefit)/expense
Consolidated Group
2015
(restated)
2016
(221,779)
231,903
10,124
27,958
227,711
255,669
(1,295,276)
814,964
(388,583)
244,490
278,891
11,179
156,943
(37,127)
10,124
255,668
As at 30 June 2016, the tax loss carried forward for the company is $259,386 (2015: nil)
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
6.
Auditor’s Remuneration
Remuneration of the auditor Crowe Horwath Sydney for:
auditing or reviewing the financial report
taxation services
due diligence services
7.
Earnings per share
(a)
Reconciliation of earnings to profit or loss
Profit/(loss) – from continuing activities
Earnings/(loss) used to calculate basic EPS &
dilutive
(b) Weighted average number of ordinary shares
outstanding during the year used in calculating basic
EPS
Weighted average number of dilutive options
outstanding
Weighted average number of ordinary shares
outstanding during the year used in calculating
dilutive EPS
(c)
Earnings/(loss) per share – basic
Earnings/(loss) per share – dilutive
8.
Cash and cash equivalents
Cash at bank and on hand
Short-term bank deposits
Consolidated Group
2015
2016
55,000
7,700
12,000
74,700
36,000
-
-
36,000
Consolidated Group
2015
(restated)
2016
(1,305,400)
559,295
(1,305,400)
559,295
24,253,895
100
2,988,818
27,242,713
-
-
cents
(5)
(5)
cents
559,295
559,295
Note
Consolidated Group
2016
2015
2,856,946
647,857
1,000,000
-
24
3,856,946
647,857
The effective interest rate on the short-term bank deposits was 2.90% at 30 June 2016. These deposits have
an average maturity of less than 3 months.
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
9.
Trade and other receivables
Current
Commission receivables
Agent commission clawback receivable
Net present value of future trailing commission
receivable
Non-Current
Net present value of future trailing commission
receivable
Consolidated Group
Note
2016
2015
(restated)
2
2
285,359
193,091
304,988
161,179
581,990
388,000
1,060,440
854,167
949,010
716,000
949,010
716,000
Management’s estimate of agent commission clawback and NPV of future trailing commission are detailed in
Note 1(n) in this financial report.
Credit risk
The Group has no significant concentration of credit risk with respect to any single counter party or group of
counter parties. On a geographic basis, the Group has significant credit risk exposures in Australia only.
The Group has assessed that there are no trade and other receivables that are impaired at year end (30 June
2015: nil). As at 30 June 2016, all trade and other receivables but $19,578 are not past due (2015: $150).
10. Other financial assets
Current
Rental Deposit
Loan receivable - director
Loan receivable - other entity
Other
Non-Current
Rental deposit
Consolidated Group
2016
2015
24,990
-
50,000
19,667
94,657
33,635
155,886
16,110
-
205,631
195,097
195,097
28,500
28,500
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
11.
Plant and Equipment
Office equipment
At cost
Accumulated Depreciation on office equipment
Motor vehicles
At cost
Accumulated Depreciation on motor vehicles
Furniture & Fittings
At cost
Accumulated Depreciation on Furniture & Fittings
Consolidated Group
2016
2015
31,834
(17,543)
14,291
142,123
(9,707)
132,416
45,753
(9,952)
35,801
18,858
(9,928)
8,930
194,665
(79,148)
115,517
11,488
(4,615)
6,873
Total plant and equipment
182,508
131,320
Movements in Carrying amounts
Movements in carrying amounts for each class of plant and equipment between the beginning and the end of the
current financial year.
Office
Equipment
Motor
Vehicles
Furniture
&Fittings
Total
Balance at 1 July 2014
Additions
Depreciation expense
Balance at 30 June 2015
Additions
Disposals
Depreciation expense
Balance at 30 June 2016
6,477
7,758
(5,305)
8,930
154,022
-
(38,505)
115,517
6,492
1,985
166,991
9,743
(1,604)
(45,414)
6,873
131,320
12,977
142,123
34,265
189,365
-
(101,717)
-
(101,717)
(7,616)
14,291
(23,507)
132,416
(5,337)
(36,460)
35,801
182,508
The motor vehicles are acquired via finance lease.
12.
Intangible assets
Website and IT system
Cost
Accumulated amortisation
Total intangibles
Consolidated Group
2015
2016
213,106
(57,356)
155,750
81,527
(12,928)
68,599
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
Balance at 1 July 2014
Additions
Amortisation
Balance at 30 June 2015
Additions
Amortisation
Balance at 30 June 2016
IT system
1,714
79,300
(12,415)
68,599
131,578
(44,427)
155,750
Intangible assets have finite useful lives. The current amortisation charges for intangible assets are included
under depreciation and amortisation expense per the statement of profit or loss.
13.
Trade and other payables
Trade payables
Employee payables
Other creditors and accruals
14. Other financial liabilities
Current
Other financial liabilities
Convertible Debt
Non-Current
Other financial liabilities
As at 1 July 2014
Borrowed
Settled
As at 30 June 2015
Borrowed
Derivative expense
Settled
As at 30 June 2016
Consolidated Group
2015
2016
160,286
167,405
135,078
462,769
134,355
137,603
71,258
343,216
Consolidated Group
2015
2016
33,698
-
33,698
42,076
767,000
809,076
149,448
149,448
106,029
106,029
Convertible Note
-
767,000
-
767,000
200,000
241,750
(1,208,750)
-
The convertible debt was originally due to be repaid in April 2016. As a result of successful IPO of the Group, the
convertible notes have been converted through issuance of 6,043,750 shares of N1 Holdings Limited according to
the Secured Convertible Note Deed Poll dated 14 April 2015.
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
15.
Tax
Current
Income tax payable
Non-Current
Deferred tax liabilities
2015
Trail commission receivable
Balance at 30 June 2015
2016
Trail commission receivable
Intangible Asset
Balance at 30 June 2016
Deferred tax assets
2015
Commission clawback
Other temporary differences
Balance at 30 June 2015
2016
Clawback and accrued
Tax Losses
IPO costs
Other temporary differences
Balance at 30 June 2016
16.
Provisions
Current
Employee provision
Provisions for Clawback
Non-Current
Long service leave
Consolidated Group
2015
2016
-
-
61,874
61,874
Opening balance
(restated)
Charged to income
statement
Closing balance
55,499
55,499
331,200
-
331,200
275,701
275,701
128,100
18,143
146,243
331,200
331,200
459,300
18,143
477,443
Opening
balance
Charged to
income
statement
Charged to
equity
Closing
balance
14,845
1,790
16,635
50,681
-
-
13,943
64,624
35,836
12,153
47,989
27,598
77,816
-
30,704
136,118
-
-
-
-
-
148,504
-
148,504
50,681
13,943
64,624
78,279
77,816
148,504
44,647
349,246
Consolidated Group
2015
2016
42,863
454,022
496,885
44,526
330,117
374,643
7,167
7,167
1,950
1,950
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
As at 1 July 2015
New provisions during the year
Payment of clawbacks during the year
Under-provision prior year
As at 30 June 2016
Movement in
clawback provision
330,117
390,157
(251,611)
(14,641)
454,022
Provision for clawback
Provision for clawback represented the estimate of commission to be clawed back by the lenders after loans are
terminated before their maturity. In the event a lender claws back the commission, a corresponding clawback will
be deducted from the authorised brokers contracted by the Group. The estimate is based on the historical record
of clawback.
Provision for employee benefits
Provision for employee benefits represents amounts accrued for annual leave and long service leave.
The current portion for this provision 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 experience, the Group 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 Group does not have an unconditional right to
defer the settlement of these amounts in the event employees wish to use their leave entitlement.
The non-current portion for this provision includes amounts accrued for long service leave entitlements that have
not yet vested in relation to those employees who have not yet completed the required period of service. The
probability of long service leave being taken is based on historical data.
17.
Capital and reserve
Fully paid ordinary shares
Option reserve
Ordinary Shares
Consolidated Group
2015
2016
5,738,586
94,448
5,833,034
100
-
100
As at beginning of the year
Issuance of new shares
Capital raising costs
Defer tax benefit for capital raising cost
Consolidated Group
2016
$
100
6,208,750
(618,768)
148,504
5,738,586
2016
Number of
Shares
100
81,043,650
-
-
81,043,750
2015
$
100
-
-
-
100
2015
Number of
Shares
100
-
-
-
100
On 18 March 2016, the Company issued 25,000,000 ordinary shares at $0.20 each to new shareholders who
subscribed for Shares in the Company through the IPO.
On 10 March 2016, the Company issued 50,000,000 shares to Mr Ren Hor Wong and 6,043,750 to convertible
noteholders in exchange for 100% of the issued capital in N1 Loans.
Ordinary Shareholders participate in dividends and the proceeds on winding-up of the parent entity in proportion
to the number of shares held. At the Shareholders' meetings each ordinary Share is entitled to one vote when a
poll is called; otherwise each Shareholder has one vote on a show of hands.
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
Option Reserve
As at beginning of the year
Share based payment
Consolidated Group
2016
-
94,448
94,448
2015
-
-
-
Details in relation to the options issued during the year are disclosed in note 21 in this financial statements.
Capital management
Management controls the capital of the Group in order to maintain a sustainable debt to equity ratio, generate
long-term shareholder value and ensure that the Group can fund its operations and continue as a going concern.
The Group’s debt and capital include ordinary share capital, convertible notes and other financial liabilities,
supported by financial assets.
The Group is not subject to any externally imposed capital requirements.
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. No debt has been retired during the current year.
18.
Lease commitments
(a)
Operating Lease Commitments
Payable — minimum lease payments
Not later than 12 months
Between 12 months and 5 years
Later than 5 years
Consolidated Group
2016
2015
154,909
177,152
472,457
596,566
-
-
627,366
773,718
The major property lease is a non-cancellable lease with a five-year term, with rent payable monthly in advance.
Contingent rental provisions within the lease agreement require that lease payments shall be increased by 4%
per annum.
(b)
Finance Lease
Within 12 months
Between 12 months and 5 years
Total
Less: future finance lease charge
Net commitment recognised as a liability
(c)
Capital Expenditure Commitments
There were no capital expenditure commitments as at 30 June 2016 (2015: nil)
Consolidated Group
2016
29,795
164,013
193,808
(20,749)
173,059
2015
42,076
125,505
165,581
(17,477)
148,104
Page | 39
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
19.
Contingent liabilities and Contingent assets
There are no contingent liabilities or contingent assets as at 30 June 2016 (2015: nil).
20.
Cash flow information
Reconciliation of Cash Flows from Operating
Activities with Profit/(Loss) after Income Tax
Profit/(loss) after income tax
Depreciation & Amortisation
Gain on sales of motor vehicle
Finance cost – convertible note discount
Share option scheme
Consolidated Group
2015
2016
(1,305,400)
559,295
80,887
(3,703)
241,750
94,448
57,829
-
-
-
(Increase)/decrease in trade and other receivables
(439,283)
(854,884)
Increase in other current assets
Increase in other financial assets
Increase/(decrease) in trade payables and accruals
Increase/(decrease) in provisions
(Increase)/decrease in deferred tax assets or liabilities
(Decrease)/increase in tax payable
Cash flows from operating activities
26,255
(191,587)
119,554
127,459
10,124
(74,160)
(1,313,656)
-
-
65,759
75,024
227,712
-
130,735
21.
Share-based payments
(a)
Employee Option Plan
The establishment of the Employee Option Plan was approved by the board of directors on 14 December 2015.
The Employee Option Plan is designed to provide long-term incentives for senior managers and above (including
executive directors) to deliver long-term shareholder returns. Under the plan, participants are granted Options
which only vest if certain performance standards are met. Participation in the plan is at the board’s discretion and
no individual has a contractual right to participate in the plan or to receive any guaranteed benefits. Once Options
are vested, the Options remain exercisable for a period of two years.
Options are granted under the plan for no consideration and carry no dividend or voting rights. When exercisable,
each Option is convertible into one ordinary Share.
Options granted under the employee option plan:
As at 30 June 2015
Granted during the year
Exercised during the year
Forfeited during the year
As at 30 June 2016
2016
Average exercise
price per Option
-
0.20
-
0.20
0.20
Number of
Options
-
5,977,500
-
(15,000)
5,962,500
2015
Average exercise
price per Option
Number of
Options
-
-
-
-
-
-
-
-
-
-
Page | 40
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
Options outstanding under the employee option plan at the end of the year have the following expiry date and
exercise prices:
Grant Date
Expiry Date
Exercise
price
Fair value at
grant date
Options
30 June 16
Options
30 June 15
14 December 2015
14 December 2018
18 March 2016
18 March 2018
0.20
0.20
0.054
0.0385
4,962,500
1,000,000
-
-
Remaining contractual
life of options outstanding
at end of period
(b)
Other share options
2.33 years
N/A
On 18 March 2016, the Company granted 1,000,000 options to Bellaire Capital Pty Ltd, an entity controlled by
parties associated with the lead manager of the IPO. Below are its Options outstanding at the end of the year and
their expiry date and exercise prices:
Grant Date
18 March 2016
Weighted average
remaining contractual life
of options outstanding at
end of period
Expiry Date
Exercise
price
Fair value at
grant date
Share options
30 June 16
Share options
30 June 15
18 March 2018
0.30
0.006685
1,000,000
1.75 years
-
N/A
(c) Fair value of the Options granted
The fair value of the Options granted is considered to represent the value of the services received over the
vesting period. The weighted average fair value of Options granted during the year was $236,819 (2015: N/A).
The value was calculated using the Binomial Approximation valuation methodology applying the following inputs:
Weighted average exercise price：
$0.21
Weighted average life of the Option: 2.71 years
Expected share price volatility:
30%
1.92%
Risk-free interest rate:
Historical share price volatility has been the basis for determining expected share price volatility as it is assumed
that this is indicative of future volatility. The life of the Options is based on the historical exercise patterns, which
may not eventuate in the future. Options included under employee benefits expense in the statement of profit or
loss amount to $66,022 and relate to equity settled share based payment transactions (2015: nil).
22.
Events after the reporting period
On 1 September 2016, the Company acquired a website (www.1crowd.com.au) owned by N1 Venture Pty Ltd
(ACN 602 937 851) at its cost of $50,000 and subsequently acquired N1 Venture at its issued capital of $100. N1
Venture holds an Australian Financial Services Licence.
On 31 August 2016, N1 Realty Pty Ltd, a fully owned subsidiary of the Group, entered into an agreement to
acquire all the issued shares in Sydney Boutique Property Pty Ltd, a real estate agency business with a cash
consideration of $2,000,000. The acquisition has not been completed when this financial report is signed.
On 17 August 2016, N1 Loans acquired loan trail book from Aura Private Wealth Pty Ltd (ACN 158 184 000) with
total consideration of $336,661.50 excluding GST.
Other than above mentioned events, there has been no matters or events since the end of the financial year
which may significantly affect the operation of the Group, the results of those operations or the state of affairs of
the Group in the future financial years.
Page | 41
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
23.
Related party transactions
Related Parties
Parent Entities
(a)
The Company is the parent entity of the Group. The following information has been extracted from the books and
records of the parent and has been prepared in accordance with Australian Accounting Standards.
2016
2015
STATEMENT OF FINANCIAL POSITION
ASSETS
Current Assets
Non-current Assets
TOTAL ASSETS
LIABILITIES
Current Liabilities
Non-current Liabilities
TOTAL LIABILITIES
EQUITY
Issued Capital
Accumulated loss
Option reserve
TOTAL EQUITY
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
Total loss after tax & total comprehensive
loss
3,732,432
12,855,317
16,587,750
15,042
865,676
880,719
15,725,272
112,689
94,448
15,707,031
112,689
-
-
-
-
-
-
-
-
-
-
-
During the reporting period, N1 Holdings Limited has not entered into any financial guarantee arrangement.
At 30 June 2016, N1 Holdings Limited has no contingent liabilities.
At 30 June 2016, N1 Holdings Limited has no contractual commitments.
Subsidiaries
(b)
Information about principal subsidiaries
The subsidiaries listed below have share capital consisting solely of ordinary shares or ordinary units which are
held directly by the Group. The proportion of ownership interests held equals the voting rights held by Group.
Each subsidiary’s principal place of business is also its country of incorporation.
Ownership interest held by the Group
2016 (%)
2015 (%)
Name of subsidiary
Principal place of
business
Australia
Australia
Australia
N1 Loans Pty Ltd (i)
N1 Migration Pty Ltd (ii)
9c
N1 Reality Pty Ltd (iii)
9c
0
The financial statements of subsidiaries used in the preparation of these consolidated financial statements were
also prepared as at the same reporting date as the Group’s financial statements.
(i)
N1 Loans was incorporated on 25 February 2010 and was initially owned by Mr Ren Hor Wong. Upon the
completion of the IPO on 18 March 2016, the company became fully owned by the Company.
N1 Migration Pty Ltd was incorporated on 14 September 2015 and is fully owned by the Group since 11
April 2016.
100%
100%
100%
N/A
N/A
N/A
(ii)
(iii) N1 Realty was incorporated on 3 May 2016 and, since then, has been fully owned by the Group.
Page | 42
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
(c)
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 considered KMP.
KMP Compensation
Please refer to the Remuneration Report contained in the Directors’ Report for details of the remuneration paid or
payable to each member of the Group’s KMP for the year ended 30 June 2016. The total of remuneration paid to
or payable to KMP of the Group during the year was:
Short-term employee benefits
Post-employment benefits
Other long-term benefit
Share-based options
Total KMP compensation
2016
282,213
23,757
1,380
45,945
353,295
2015
81,517
7,283
123
-
88,923
Short-term employee benefits
These amounts include fees and benefits paid to non-executive directors as well as all salary, paid leave benefits,
fringe benefits and cash bonuses awarded to executive directors and other key management personnel.
Post-employment benefits
These amounts are the current year’s estimated costs of provided for the Group’s superannuation contributions
made during the year.
Other long-term benefits
These amounts represent long service leave benefits accruing during the year.
Share-based payments
These amounts represent the expense related to the participation of KMP in equity-settled benefit schemes as
measured by the fair value of the options granted.
(d)
Other Related Parties
Other related parties include entities controlled by the ultimate parent entity and entities over which key
management personnel have joint control.
Transactions with other 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.
The following transactions occurred with other related parties:
Purchases of services/goods from other related parties
2016
2015
N1 Consultants Group Sdn Bhd - Malaysia
N1 Forex Pty Ltd
V1 Finance Pty Ltd
Seekahome Pty Ltd
Loan to related parties - balance
N1 Venture Pty Ltd – receivable
Ren Hor Wong – (payable)/receivable
55,542
111,569
-
-
64,118
-
72,000
-
2016
50,000
2015
16,110
(964)
155,886
Page | 43
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N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
As at 1 July 2014
Drawdown
Repayment
As at 30 June 2015
Drawdown
Repayment
As at 30 June 2016
Loan to
N1 Venture
Pty Ltd
-
31,882
(15,772)
16,110
41,000
(7,110)
50,000
Loan to Ren
Hor Wong
17,380
201,322
(28,056)
155,886
8,117
(164,967)
(964)
24.
Financial risk management
The Group’s financial instruments consist mainly of deposits with banks, accounts receivable and payable, other
payables and other financial liabilities.
The totals for each category of financial instruments, measured in accordance with AASB139 financial
instruments: recognition and measurement as detailed in the accounting policies to these financial statements,
are as follows:
Financial Assets
Current
Cash and cash equivalents
Trade and other receivables
Rental deposit
Loan receivable – other entity
Non-current
Trade and other receivables
Rental deposit
Financial Liabilities
Financial liabilities at amortised cost
Current
Trade and other payables
Convertible debt
Finance lease payables
Non-current
Finance lease payables
Note
8
9
10
13
Consolidated Group
2016
2015
3,856,946
1,060,440
24,990
50,000
647,857
854,167
33,635
171,996
949,010
195,097
716,000
28,500
462,769
-
33,698
343,216
767,000
42,076
149,448
106,029
Specific financial risk exposures and management
The main risks the Group are exposed to through its financial instruments are credit risk, liquidity risk and market
risk consisting of interest rate risk and foreign exchange risk. Financial risks are identified, measured and
managed in accordance with the Group’s policies and risk objectives. The Company has a risk governance
framework which is reviewed and updated by the Board constantly. There have been no substantive changes in
the types of risks the Group is exposed to, how these risks arise, or the Board’s objectives, policies and
processes for managing or measuring the risks from the previous period.
Page | 44
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
(a)
Credit risk
Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of
contract obligations that could lead to a financial loss to the Group.
Credit risk is managed through the maintenance of procedures (such as the utilisation of systems for the
approval, granting and renewal of credit limits, regular monitoring of exposures against such limits and monitoring
of the financial stability of significant customers and counterparties), ensuring to the maximum extent possible
that customers and counter parties to transactions are of sound credit worthiness. Such monitoring is used in
assessing receivables for impairment. Credit terms are generally not more than 60 days from the invoice date.
Credit risk exposures
The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period, is
the carrying amount and classification of those financial assets (net of any provisions) as presented in the
statement of financial position.
The Group has no significant concentration of credit risk with any single counterparty or Group of counterparties.
However, on a geographic basis, the Group has significant credit risk exposures to Australia given the substantial
operations in those regions. Details with respect to credit risk of trade and other receivables is provided in Note1.
Trade and other receivables that are neither past due or impaired are considered to be of high credit quality.
Aggregates of such amounts are as detailed at Note 9.
Credit risk related to balances with banks and other financial institutions is managed by the Board. All the Group’s
cash assets are deposited with Australian major banks and their credit ratings are between A-to AA based on
Standard & Poor.
The majority of outstanding receivables are commissions (including NPV of future trailing commissions) owed
from Finsure Finance and Insurance Pty Ltd ABN 72 068 153 926 (Finsure), Spectrum Wealth Advisers Pty Ltd
ABN 57 134 661 706 (Spectrum Wealth Advisers) and lenders who make commission payments directly to the
Group. Finsure is an aggregator of retailing loan brokers and acts as an intermedia between the Group and the
lenders (financial institutions) to pass through the commission paid by those lenders to the Group. Spectrum
Wealth Advisers is a dealer group who pays financial planning commissions to the Group on behalf of financial
institutions. The financial institutions which are owing commissions to the Group through Finsure and Spectrum
Wealth Advisers are rated between B and AA+.
(b)
Liquidity risk
Liquidity risk arises from the possibility that the Group might encounter difficulty in settling its debts or otherwise
meeting its obligations related to financial liabilities. The Group managed this risk through maintaining sufficient
liquid assets (mainly cash and cash equivalents and borrowing facilities).
The table below reflects an undiscounted contractual maturity analysis for financial liabilities.
Cash flows realised from financial assets reflect Management’s expectation as to the timing of realisation. Actual
timing may therefore differ from that disclosed.
Financial liability maturity analysis
No more
than 1 year
1-2 years 2-5 years
More than
5 years
462,769
-
-
29,794
29,795
134,219
492,563
29,795
134,219
-
-
-
2016
Trade and other payables
Finance lease liabilities
2015
Trade and other payables
Convertible debt
Finance lease liabilities
Total
contractual
cash flows
462,769
193,808
656,577
Total
contractual
cash flows
343,216
767,000
148,105
No more
than 1 year
343,216
767,000
148,105
1,275,797
1,275,797
1-2 years 2-5 years
More than
5 years
-
-
-
-
-
-
-
-
-
-
-
-
Page | 45
For personal use only
N1 HOLDINGS LIMITED
NOTES TO THE FINANCIAL STATEMENTS
30 JUNE 2016
Market risk
(c)
Interest rate risk
Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the
reporting period where by a future change in interest rates will affect future cash flows or the fair value of fixed
rate financial instruments. The financial instruments that primarily expose the Group to interest rate risk to cash
and cash equivalents.
Fixed rate instrument
Term deposit
Consolidated Group
2016
1,000,000
2015
-
Sensitivity Analysis: As interest rate are low at present 2.90%, a movement in the rate by 1% would be $10,000
either way.
Foreign currency risk
At the reporting date the Group held cash assets dominated in USD (2016: US$738,000, 2015: nil). The foreign
exchange rate was at 0.7435 (AUD/USD). A movement in the rate by 5% would be $27,435 either way in the
revaluation of the USD to AUD equivalent.
25.
Fair value measurement
AASB13: fair value measurement requires the disclosure of fair value information by level of the fair value
hierarchy, which categorises fair value measurements into one of three possible levels based on the lowest level
that an input which is significant to the measurement can be categorized into as follows:
Level 1
Level 2
Level 3
Measurements based on quoted prices
(unadjusted) in active markets for
identical assets or liabilities that the
entity can access at the measurement
date.
Measurements based on inputs
other than quoted prices included
in Level 1 that are observable for
the asset or liability, either directly
or indirectly.
Measurements based on
unobservable inputs for the
asset or liability.
Fair value of financial assets and liabilities that are measured at fair value on a recurring basis.
The Group does not have any assets or liabilities recognised and subsequently measured at fair value on a
recurring basis.
Fair value of financial assets and liabilities that are not measured at fair value (but fair value disclosures
are required)
Future trailing commission receivables are initially recognized at fair value and subsequently carried at amortised
cost.
Valuation techniques and unobservable inputs used to measure Level 3 fair value
The fair value of the trailing commission receivables is initially recognised using a discounted cash flow
methodology. The following table provided quantitative information regarding the significant unobservable inputs,
the ranges of those inputs and the relationships of unobservable inputs to the fair value estimate:
Input
Underlying
assumptions
Estimated sensitivity of fair value
measurement to changes in unobservable
inputs
Weighted average life
2.05 years
N/A
Discount rate (risk adjusted) – 8%
8%
Weighted average run-off rates
15%
If discount rate is 2% higher/lower, the fair
value would decrease/increase by
$55,000/$60,000 (2015: $42,000/$45,000)
If run-off rate is 1% higher/lower, the fair value
would decrease/increase by 43,000/45,000
(2015: $42,000/$44,000)
Page | 46
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N1 HOLDINGS LIMITED
DIRECTORS’ DECLARATION
30 JUNE 2016
Directors’ Declaration
In accordance with a resolution of the Directors of the Company, the Directors of the Company declare that:
1.
2.
3.
The financial statements and notes of the Company, as set out on pages 19 to 46, are in accordance
with the Corporations Act and:
comply with Australian Accounting Standards (including the Australian Accounting Interpretations)
(a)
and the Corporations Regulations 2001 (Cth); and
give a true and fair view of the consolidated entity’s financial position as at 30 June 2016 and of
(b)
the performance for the year ended on that date.
The financial statements and notes also comply with International Financial Reporting Standards as
described in Note 1 to the financial statements.
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 Directors have been given the declarations required by section 295A of the Corporations Act from the
Chief Executive Officer and Chief Financial Officer.
On behalf of the board
Ren Hor Wong
Executive Chairman and CEO
29 September 2016
Sydney
Page | 47
For personal use only
N1 HOLDINGS LIMITED
SHAREHOLDER INFORMATION
30 JUNE 2016
Page | 48
For personal use only
N1 HOLDINGS LIMITED
SHAREHOLDER INFORMATION
30 JUNE 2016
Page | 49
For personal use only
N1 HOLDINGS LIMITED
SHAREHOLDER INFORMATION
30 JUNE 2016
Additional information required by the Australian Securities Exchange Ltd (ASX) and not disclosed elsewhere in
this report is set out below. The information is current as at 16 September 2016.
1.
a.
b.
c.
Shareholding
Distribution of Shareholders
Category (size of holding)
Number of shares
%
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 – and over
Total
1,000
40,638
1,062,501
6,761,325
73,178,376
81,043,750
0.00%
0.05%
1.31%
8.34%
90.29%
The number of shareholdings held in less than marketable parcels is 4.
Number of
holders
1
11
107
209
54
382
%
0.26%
2.88%
28.01%
54.71%
14.14%
The names of the substantial shareholders listed in the holding company’s register are:
Shareholder
REN H WONG PTY LTD
TIN FAMILY SMSF PTY LTD
THE THREE HORSESHOES PTY LTD
JIANRONG SUN
YOKE MENG CHAN
Total
d.
20 Largest Shareholders — Ordinary Shares
Shareholder
Number of
Ordinary
Fully Paid
Shares Held
50,000,000
4,250,000
3,750,000
1,250,000
975,266
60,225,266
% Held
of Issued
Ordinary Capital
61.70%
5.24%
4.63%
1.54%
1.20%
74.31%
Number of
Ordinary
Fully Paid
Shares Held
% Held
of Issued
Ordinary Capital
1.
2.
3.
4
5
6
7
8
9
10
11
12
13 MUN CHING WANG
14
15
16
17 MANNI FU
18 HUEY CHARNG WONG
19. BNP PARIBAS NOMS PTY LTD
20. YUEXIAN ZHAO
50,000,000
REN H WONG PTY LTD
4,250,000
TIN FAMILY SMSF PTY LTD
3,750,000
THE THREE HORSESHOES PTY LTD
1,250,000
JIANRONG SUN
975,266
YOKE MENG CHAN
829,215
TONG CHAI TAN
MXJ PTY LTD
625,000
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED 556,000
AUSTRALIA WIDE DEVELOPMENT GROUP PTY LTD 500,000
500,000
TONG CHAI TAN
500,000
VEN TAN PTY LTD
500,000
LC FAMILY SUPER PTY LTD
500,000
487,500
425,000
418,750
375,000
350,000
320,000
306,188
IPOH YAP SMSF CO PTY LTD
ZHAOJIA HE
SILIAN ZHAO
61.70%
5.24%
4.63%
1.54%
1.20%
1.02%
0.77%
0.69%
0.62%
0.62%
0.62%
0.62%
0.62%
0.60%
0.52%
0.52%
0.46%
0.43%
0.39%
0.38%
Total
67,417,919
83.19%
Page | 50
For personal use only
N1 HOLDINGS LIMITED
SHAREHOLDER INFORMATION
30 JUNE 2016
e.
Escrowed shares
Name
1.
2.
3.
4.
REN H WONG PTY LTD
JIANRONG SUN
TIN FAMILY SMSF PTY LTD
MXJ PTY LTD
Total
Number of
Escrowed
Fully Paid
Shares Held
50,000,000
1,250,000
1,250,000
625,000
53,125,000
% Held
of Issued
Ordinary Capital
61.70%
1.54%
1.54%
0.77%
65.55%
f.
Vested Options
1,000,000 options exercisable at $0.20 and expiring on 18 March 2018 are held by Value Creation
Holdings Limited, an entity controlled by Non-Executive Director Tarun Kanji.
1,000,000 options exercisable at $0.30 and expiring on 18 March 2018 are held by Bellaire Capital
Pty Ltd, an entity controlled by parties associated with the lead manager of the IPO.
g.
Voting Rights
The voting rights attached to each class of equity security are as follows:
Ordinary shares
–
Each ordinary share is entitled to one vote when a poll is called, otherwise each member
present at a meeting or by proxy has one vote on a show of hands.
There are no other classes of equity securities.
Page | 51
For personal use only
N1 HOLDINGS LIMITED
SHAREHOLDER INFORMATION
30 JUNE 2016
Page | 52
For personal use only