More annual reports from OpenLearning Limited:
2023 ReportLifelong Learning.
Endless Possibilities.
OpenLearning Limited (ASX:OLL)
Annual Report 2019
For personal use only Contents
Performance Highlights
The OpenLearning solution
Network Effect
Managing Director’s Report
Chairman’s Report
Directors’ Report
Auditor’s Independence Declaration
Financial Report
Consolidated statement of profit or loss
4
6
8
10
12
13
30
31
32
34
Consolidated statement of comprehensive income 33
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
40
35
68
65
73
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For personal use only A life
long plan
Powering the future
of online education
OpenLearning Limited is a Sydney-based, software-as-a-
service company that provides a scalable online learning
platform and learning design services to education providers;
and a global marketplace of world-class micro-credentials
and online degrees for learners.
Built on proven learning sciences research and a social
constructivist learning philosophy, OpenLearning goes
beyond traditional instructivist approaches and static
learning management systems to deliver authentic,
active and connected learning experiences.
Founded in 2012 in Sydney, OpenLearning’s vision is to
improve access to quality education, promote lifelong
learning, and future-proof the workforce by enabling
education providers to design, deliver and sell transformative
courses and degrees worldwide.
OpenLearning expanded to Southeast Asia in 2015 by
establishing an office in Kuala Lumpur, Malaysia, and is now the
leading platform for online higher education in Southeast Asia.
Today, OpenLearning employs over 45 people globally
across its offices in Sydney and Kuala Lumpur, with remote
team members spread across the world to serve its global
client-base.
OpenLearning is uniquely placed to be an education provider’s
partner of choice thanks to its innovative proprietary online
learning platform, depth of expertise in education, established
partnerships with leading universities and organisations,
and a large and growing user-base of lifelong learners.
With more than 1.74 million learners worldwide, 7,900
courses and partnerships with over 62 education providers,
OpenLearning is at the forefront of a new wave of
education delivery.
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Discover your
passion, learn
a new skill and
change careers,
online.
Delivering transformative learning
experiences online, worldwide.
2
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For personal use only Performance
Highlights
Financial Highlights
(all financial amounts are in AUD unless otherwise stated)
77%
YoY increase in
annualised recurring
revenue (ARR) to $944k
at the end of FY19
2.8%
YoY increase in gross
sales to $1.94m, while
successfully transitioning
to SaaS model
20.30%
YoY increase in cash
receipts to $2.24m
1 Annualised recurring SaaS revenue, calculated by utilising the generally accepted industry standard, which involves
multiplying the monthly accrued SaaS revenue in the month at the end of the quarter by 12 (months). The ARR calculation
does not take into account the future expiry of the term of any contract under which SaaS revenue is generated or any
customer lost during the relevant month.
4
For personal use only Usage
highlights
170%YoY increase in B2B
SaaS clients to 62 at
the end of FY19
29.4%YoY increase in unique
registered learners to
1.74m at the end of FY19
39.8%YoY increase in
enrolments to 2.54m
at the end of FY19
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Strong cash position at
end of FY19 of
$7.74m
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The
OpenLearning
Solution
The OpenLearning platform has been built
from the ground up on solid educational
foundations since its inception.
OpenLearning handles all aspects of delivering an online
learning experience through its unique operating model
that includes everything an education provider would
need to launch an online education business:
The goal is to provide a social learning environment in
which students feel empowered, deep learning experiences
are fostered, students are intrinsically motivated, and
passionate communities of practice flourish through
well-designed constructive experiences. This has been
realised with the latest social technology, and is designed
for a global, connected society.
OpenLearning is an innovator
in its field, providing a launch
pad for new academic research
and extending existing
educational theory through
advanced platform mechanics.
We work with both educators
and technologists in continual
experiments to develop a next
generation learning environment.
1. Scalable online learning platform hosted in Australia
and accessible worldwide, which enables end-to-end
online education delivery for university degrees,
micro-credentials and vocational education and
professional development to bridge skills gaps;
2. Learning services division comprised of learning
designers (online learning specialists) who collaborate
with subject matter experts to redesign their courses
and upskill staff at education providers to create high
quality online courses; and
3. Global marketplace for education where universities
and education providers are able to promote their
online courses or degrees to millions of learners
worldwide.
This approach enables OpenLearning to generate
significant value for its partners across a range of
use-cases and markets – solving some of the greatest
challenges facing education providers:
• Deliver their accredited and non-accredited courses
online via its scalable cloud learning platform to
domestic and international students, either fully online
or blended;
• Diversify their revenue streams through the delivery
of university or higher education provider branded short
courses and micro-credentials to bridge the skills gap
for working professionals;
• Diversify their sources of international students by
raising their brand awareness in Southeast Asia by
leveraging OpenLearning’s database of 1.74m learners;
• Build a sustainable pipeline of international students
by offering university foundation year programs online,
offshore and in-country through partners; and,
•
Increase engagement of international students by
offering large-scale language and enrichment courses
to support students at both regional and urban higher
education campuses.
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For personal use only 1.74m+
learners
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Network
Effect
The OpenLearning platform primarily operates
on a B2B2C model, whereby education providers are
utilising the platform to deliver courses to learners.
Depending on the goals of the education provider and the
type of courses they offer, the Company may be able to
promote the education providers courses to other learners
on the OpenLearning platform. This produces a network
effect, which is enabled by a number of key design
decisions, including:
1
Single global cloud platform whereby
all education providers and learners
use the same instance of the platform.
4
Learners are able to browse the
marketplace and opt-in to receive
information about new courses.
2
3
Strong relationship with the
end-consumer by ensuring that
the Company’s logo is visible
on every page.
5
Profile for every user that
automatically aggregates all
of their evidence of learning into
an online portfolio, as well as
their badges, certificates and
Course progress.
Every user has an OpenLearning
user account, regardless of whether
they arrive at the OpenLearning
platform through the marketplace
or via an institution portal.
In short, an increase in the number of education
providers on the OpenLearning platform has the potential
to lead to an increase in the number of Courses being
delivered via the platform to both new and existing
learners. This increase in Courses and learners attracts
new education providers to deliver their Courses on the
platform so that they can benefit from exposing their
brand and Courses to the OpenLearning userbase.
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For personal use only LEARNERS OPT-IN
Student
Acquisition
Direct to Student
(Customers promote courses
to their learners)
OpenLearning Marketplace
(Courses promoted to
existing user-base)
B2B SaaS
Model
Corporate/Government
(annual fees based on # of learners)
Education Providers
(annual fees based on # of learners)
Industry-leading learning and capability
Education
Expertise
200+ courses
CPD, Humanities & STEM
Multi-language
Universities & TVET
Courses & Degrees
Scalable education technology and online learning platform
DIY course creation
Collaboration
Course delivery
Learning analytics
Technology
Platform
Certification
Portfolios
Badges
Gamification
Multi-currency
Constructivist pedagogy
Project-based learning
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Managing Director’s Report
Dear fellow shareholders,
2019 was a year of transition for OpenLearning with
fundamental changes to our business model, team, and
corporate structure, which have laid the foundations for
further growth in 2020 and beyond.
Over the course of the past 12 months, the Company
completed its transition to a SaaS business model,
successfully restructured its operations to invest in sales
and marketing, complete its listing on the ASX, grew SaaS
revenue into the Company’s largest revenue stream and
raised enough capital to fully fund the Company’s growth
strategy as outlined in its prospectus.
As of the end of FY19, OpenLearning has had over 2.54 million
enrolments from 1.74 million registered learners across
7,900 courses provided by 62 education providers, making
it one of the world’s largest online education platforms.
As a result of a restructure carried in Q3 19, the Company
was able to reduce operational cash burn and operating
costs in Q4 19. This provided a strong tailwind to the
Company’s FY19 results.
In FY19, the Company’s gross sales increased by 2.8% YoY
to $1.94m with operating cash receipts increasing 20.30% to
$2.24m. A strong result considering the Company’s change
in business model to focus on SaaS and its restructure.
The Company achieved a 91% YoY increase in high
margin SaaS fees, which accounted for 37% of gross
sales. The Company’s net cash flows used in operating
activities improved to $3.87m in FY19 from $4.54m in the
prior year. OpenLearning had cash at bank of $7.74m at
31 December 2019, ensuring that we are able to fully
execute our growth strategy in FY20 and take advantage
of the opportunities that present themselves as the world
looks towards online education in the years to come.
Solid growth in annualised recurring revenue
and customer acquisition
OpenLearning ended the year strongly, with ARR
increasing by 77% YoY to $944k as a result of new B2B SaaS
clients being onboarded in the quarter and an increase in
usage (learners taking courses on the platform) amongst
existing clients.
The following charts show the growth in B2B SaaS
Customers, SaaS annualised recurring revenue (ARR),
cumulative unique users, and cumulative enrolments over
the past seven quarters.
B2B SaaS Customers
70
60
50
40
30
20
10
0
62
55
45
34
23
14
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JUN
2018
SEP
2018
DEC
2018
MAR
2019
JUN
2019
SEP
2019
DEC
2019
SaaS ARR (AUD, ’000s)
$1,000
$800
$600
$400
$200
$0
944
790
667
585
534
434
292
JUN
2018
SEP
2018
DEC
2018
MAR
2019
JUN
2019
SEP
2019
DEC
2019
Cumulative Unique Users (’000s)
2,000
Cumulative Enrolments (’000s)
3,000
1,735
1,652
1,423
1,341
1,535
1,500
1,158
1,023
1,000
5,00
0
JUN
2018
SEP
2018
DEC
2018
MAR
2019
JUN
2019
SEP
2019
DEC
2019
2,500
2,000
1,500
1,000
500
0
2,401
2,540
2,273
2,120
1,817
1,435
1,573
JUN
2018
SEP
2018
DEC
2018
MAR
2019
JUN
2019
SEP
2019
DEC
2019
Images 1 – 4: B2B SaaS Customers, SaaS ARR, Cumulative Unique Users, and Cumulative Enrolments Growth, June 2018 – December 2019
10
For personal use only OpenLearning ended FY19 with a strong and advanced
pipeline of potential clients in Australia and Malaysia, and with
a number of addition al clients already secured and expected
to commence utilising the Company’s platform in FY20.
online learning as a means of delivering both accredited
and non-accredited courses in Australia, Malaysia and
around the world.
Successful listing on the ASX
In a significant milestone for our team and shareholders,
OpenLearning commenced trading on the Australian Securities
Exchange (ASX) under the ticker code ‘OLL’ on December
12 following an oversubscribed Initial Public Offering (IPO).
The IPO attracted significant interest, opening on
November 13 and closing five days later after receiving
applications from investors well in excess of the maximum
raise of $8 million, including a strategic investment of
$1 million from the Australian Catholic University – the
first of its kind for an Australian university.
The funds raised from the IPO are being utilised to
accelerate sales and marketing activities to universities and
other higher education providers in Australia and Malaysia.
In addition, the Company is investing in initiatives to
increase brand awareness, ensuring that the OpenLearning
platform remains cutting edge and is able to attract
education providers from outside its target markets.
The IPO marks the next phase of OpenLearning’s journey
and provides us with a platform to accelerate our growth.
It will enable the Company to raise its profile, attract the
best talent and ensure that it has the right corporate
governance framework in place with the appropriate level
of transparency.
The support of our team, shareholders, customers and
stakeholders throughout the process is a testament to the
quality of the OpenLearning platform, the services that we
provide and the critical importance of the problem that
we’re solving.
Strong sector tailwinds
The Company is seeing increased demand from higher
education providers to design and deliver both non-
accredited and accredited courses online as a result of recent
disruptions in the higher education sector due to COVID-19.
Additionally, the potential impact on higher education
providers’ revenue from a decline in international students
and widespread campus closures has led to renewed
interest from education providers in delivering their courses
and degrees online, as well as diversifying their sources
revenue by offering short courses and micro-credentials
to working professionals.
To capitalise on the opportunity, the Company has moved
quickly to establish a partnership with Alibaba Cloud to
ensure high speed access the OpenLearning platform in
mainland China, where the majority of the international
students who are unable to make it to Australia are located.
The Company recently signed a SaaS and partnership
agreement with High Resolves, a global not-for-profit to
deliver their programs into hundreds of schools globally.
While it is too early to determine the overall impact of the
new dynamics we’re seeing in the market, the Company is
well placed to support education providers as they explore
Critical importance of higher
education to the Australian economy
Few industries are as critically important to Australia’s
economy and our society as higher education. While
technology is already transforming vast sections of our
country, education providers have been slow to adapt
– opting for incremental improvements as opposed to
ground-breaking transformation.
This dynamic is beginning to change. Students and working
professionals require news skills to adapt to new ways of
working, they’re demanding short courses rather than
multi-year degrees. It is becoming increasing clear that
higher education is moving and must move from a once-in-
a-lifetime product to lifelong learning experience.
The opportunity ahead of the Company is significant –
in Australia, Malaysia, Southeast Asia and around the
world as millions of people look to further their education
online. Globally, there are only a handful of companies
that are well placed to benefit from this once in a
generation change and OpenLearning is leading the
way. While significant change always takes time, the
pace is definitely accelerating.
To get us there, we have assembled a dedicated, innovative
and passionate team, and an experienced and dynamic
board with the right mix of skills to grow OpenLearning into
Australia’s next great education technology company.
Stellar team and board of directors
I would like to thank my fellow directors, chairman
Kevin Barry, Professor Beverley Oliver, Spiro Pappas,
David Buckingham and Maya Hari for their support and
expertise, and our previous directors who retired prior to
the listing in December 2019, especially the Company’s
former chairman and angel investor, Clive Mayhew.
I’m proud to work alongside our diverse and highly
regarded leadership team, including founder and
CTO David Collien, Managing Director for Australia
Cherie Diaz, Managing Director for Malaysia Sarveen
Kandiah and CFO Huat Koh.
Thank you for your support of OpenLearning. Together,
I’m confident that the Company will continue to grow
and generate significant returns for all our shareholders
in the years to come.
Kind regards
Adam Brimo
Managing Director and Group CEO
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Chairman’s Report
Dear fellow Shareholders
I am delighted to present OpenLearning Limited’s
(“OL”) Annual Report for the financial year ended
31 December 2019.
The Company develops and operates an online education
platform (OL Platform) on a software-as-a-service
(SaaS) business model whose primary customers are
education providers based in Australia and the
South-East Asian markets.
The Company successfully listed on the ASX in December
2019 raising $8 million to fund growth opportunities, reward
and incentivise senior management to drive the underlying
growth of the business and to further develop the
OpenLearning Platform.
FY19 Year Results
During FY19 year, the Group restructured its operations in
Australia and Malaysia to focus on growing Platform SaaS
revenue by expanding its sales, marketing and customer
success teams, and significantly reducing the headcount
of its Services division. This change in strategy resulted
in a decline in Services revenue in FY2019 as compared
to FY2018 but led to strong growth in Platform SaaS and
Marketplace gross sales, which grew by 91% and 108%
respectively y-o-y.
Gross sales for FY2019 increased by 2.8% y-o-y, despite
the reduction in Services sales, due to strong growth
in Platform SaaS and Marketplace sales.
Statutory net loss for FY2019 increased 75.8% y-o-y
to $(7,719,951) due to incurring of the following major
cost elements:
• operating costs to increase market share in the online
education space;
• costs related to rationalisation exercise; and
• costs related to pre-IPO and IPO expenses
There was no significant change y-o-y in the normalised
loss after tax for FY2019 at $(4,398,704).
Net cash flows used in operating activities improved to
$(3,874,122) in FY2019 from $(4,544,548) in the prior year.
Strategy
The Company’s strategy is to increase high margin
platform SaaS revenue by expanding its sales and
marketing resources to acquire more clients from the
higher education sector and increase usage of the
platform by its existing clients.
Historically, the majority of the Company’s revenue was
derived from professional services and course sales
through its marketplace, while these two divisions will
continue to contribute to the Group’s revenue, the Group
expects platform SaaS revenue to grow significantly faster
and become the majority of the Group’s revenue over time.
The Company is investing in its online sales channel and
website to acquire and onboard Platform SaaS clients
online and through inside sales, which will enable it to
serve clients beyond its existing markets.
People
Our team is truly committed to bringing our business
strategy to fruition. On behalf of the Board, I would like to
thank each and every one of our dedicated team members
for their hard work throughout the year culminating with
the listing of the Company on the ASX in December 2019.
Looking Ahead
The world is currently facing a number of challenges due to
COVID-19 and while the potential impact on the Company
is not yet clear, a number of education providers have
expressed an intention to expand their online education
offerings and the Company is actively working with its
clients to support their urgent needs.
Through the work that has been performed in FY19, the
Board believes the Company is well-positioned to grow
and build up its position as one of the leading online
education platforms in the market.
Kevin Barry
Chairman
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For personal use only Directors’
Report
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Directors’ Report
Your directors present their report on the Consolidated Entity (referred to herein as the Group) consisting
of OpenLearning Limited and its controlled entities for the financial year ended 31 December 2019.
Directors
The following persons were directors of OpenLearning Limited during or since the end of the financial year up
to the date of this report:
Kevin Barry
Non-Executive Chairman (appointed 30 August 2019)
Adam Brimo
Managing Director and Group CEO (appointed 30 August 2019)
Spiro Pappas
Non-Executive Director (appointed 30 August 2019)
David Buckingham
Non-Executive Director (appointed 9 December 2019)
Professor Beverley Oliver
Non-Executive Director (appointed 9 December 2019)
Maya Hari
Non-Executive Director (appointed 9 December 2019)
Particulars of each director’s experience and qualifications are set out later in this report.
Principal Activities
The principal activities of the Group during the financial year were:
• providing a cloud-hosted social learning platform for delivering short courses, blended learning and online degrees;
• providing learning design services; and
• promotion and sale of educational courses through a global marketplace.
Review of operations and financial position
Results for financial year 2019 (“FY2019”):
• gross sales of $1,940,762, an increase of 2.8% year-on-year (“y-o-y”);
• revenue of $1,602,613, a decline of (9.2)% y-o-y;
• normalised loss after tax of $(4,398,704), no significant change y-o-y;
• statutory loss after tax of $(7,719,951), an increase in losses of 75.8% y-o-y.
Revenue from ordinary activities
Revenue comprises of the following:
Platform SaaS fees
Marketplace sales
Services sales
Gross sales
2019
$
2018
$
INC/(DEC)
%
1,602,613
1,765,095
(9.2)
379,259
90.5
282,139
>100.0
722,525
585,928
632,309
1,227,101
1,940,762
1,888,499
(48.5)
2.8
Less: Sharing of revenue with course creators
(338,149)
(123,404)
>100.0
Revenue
1,602,613
1,765,095
(9.2)
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For personal use only Revenue for FY2019 declined by (9.2)% compared to the comparative FY2018 to $1,602,613 due to the decline in Services
sales. In July 2019, the Company restructured its operations in Australia and Malaysia to focus on growing Platform SaaS
revenue by expanding its sales, marketing and customer success teams, and significantly reducing the headcount of its
Services division by no longer offering learning design services in Malaysia and reducing the scope of its Services division
in Australia. This change in strategy resulted in a decline in Services revenue in FY2019 as compared to FY2018 but led to
strong growth in Platform SaaS and Marketplace sales, which grew by 91% and 108% respectively y-o-y.
Gross sales for FY2019 increased by 2.8% y-o-y, despite the reduction in Services sales, due to strong growth in Platform
SaaS and Marketplace sales.
Statutory net loss for FY2019 increased 75.8% y-o-y to $(7,719,951) due to incurring of the following major cost elements:
• operating costs to increase market share in the online education space;
• costs related to rationalisation exercise;
• costs related to pre-IPO and IPO expenses.
There was no significant change y-o-y in the normalised loss after tax for FY2019 at $(4,398,704). A reconciliation of
statutory loss to normalised loss is appended below.
Normalised loss after tax
Costs incurred on rationalisation exercise
Pre-IPO and related expenses
IPO and related expenses
Statutory loss after tax
2019
$
2018
$
(4,398,704)
(4,313,610)
(250,537)
(180,829)
(2,889,881)
(78,017)
–
–
(7,719,951)
(4,391,627)
Cash and cash equivalents increased to $7,740,768 as at financial year-end due to the proceeds from the successful listing
of the Company on the ASX in December 2019.
Significant changes in the state of affairs
The Group undertook the transactions described below during the financial year as part of a corporate reorganisation
to facilitate the listing of the Company on the ASX.
The Company acquired the entire issued and paid-up share capital of OLG Australia Investors Pte Ltd (“OLGAI”) from all
its shareholders (“OLGAI Shareholders”) via the entry and execution of a share exchange agreement made between the
OLGAI Shareholders and the Company (“OLGAI Share Exchange Agreement”).
OLGAI together with a group of minority shareholders (“OLGSG Minority Shareholders”) own the entire issued and
paid-up share capital of OpenLearning Global Pte Ltd (“OLGSG”). OLGSG in turn owns the entire issued and paid-up
share capital in Open Learning Global Pty Ltd (“OLGAU”) and OpenLearning Global (M) Sdn Bhd (“OLGMY”). OLGAU
and OLGMY are the operating subsidiaries of the Group providing a cloud-based social learning platform, learning design
services and sale of education course through a global marketplace.
The Company, together with the execution of the OLGAI Share Exchange Agreement, also acquired the entire issued and
paid-up share capital of OLGSG via the entry and execution of a share exchange agreement made between the OLGSG
Minority Shareholders and the Company (“OLGSG Share Exchange Agreement”).
Pursuant to the OLGAI Share Exchange Agreement and the OLGSG Share Exchange Agreement (collectively, the “Group
Share Exchange Agreements”), both the OLGAI Shareholders and the OLGSG Minority Shareholders sold and transferred
all their respective shares in OLGAI and OLGSG to the Company in exchange for the Company allotting to each of the
OLGAI Shareholders and OLGSG Minority Shareholders new shares in the Company representing all the issued and
paid-up shares of the Company.
Following the completion of the Group Share Exchange Agreements, the Company further issued shares (i) pursuant to
conversion of convertible notes, (ii) to advisors and a director for services rendered and (iii) for the initial public offering
of shares on the ASX.
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Directors’ Report
Continued
Following the completion of the Group Share Exchange Agreements, the Company held the following subsidiaries
as at 31 December 2019:
Held by the Company
OLG Australia Investors Pte Ltd
OpenLearning Global Pte Ltd
Held by OpenLearning Global Pte Ltd
Open Learning Global Pty Ltd
OpenLearning Global (M) Sdn Bhd
* 63.89% held via OLG Australia Investors Pte Ltd.
2019
%
100
100*
100
100
Events after the reporting period
The Company is currently reviewing and closely monitoring the Novel Coronavirus 2019 (COVID-19) situation as it
unfolds, ensuring compliance and cooperation with protocols and advice as and when issued by the Government.
The Directors are reviewing business operations and strategies and assessing the impact on the Group. The Group is
unable to determine at this time the potential impact COVID-19 will have, noting that a number of education providers
have expressed an intention to expand their on-line education offerings and the Group is actively working to support
their urgent needs.
Future development, prospects and business strategies
Notwithstanding the potential impact that COVID-19 may have on the Group’s operations, the Group will continue its
strategy to increase high margin platform SaaS revenue by expanding its sales and marketing resources to acquire more
clients from the higher education sector and increase usage of the platform by its existing clients.
Historically, the majority of the Group’s revenue was derived from professional services and course sales through its
marketplace, while these two divisions will continue to contribute to the Group’s revenue, the Group expects platform
SaaS revenue to grow significantly faster and become the majority of the Group’s revenue over time.
The Group is investing in its online sales channel and website to acquire and onboard Platform SaaS clients online and
through inside sales, which will enable it to serve clients beyond its existing markets.
Environmental issues
The Group’s operations are not regulated by any significant environmental regulations under the laws of the countries
where the Group operates in.
Dividends
No dividends were paid or declared during or since the end of the financial year and there were no declared dividends
unpaid at the date of this report.
Indemnification and insurance of directors and officers
During the year, the Group has paid a premium in respect of an insurance contract insuring all directors and officers
of the Group against liabilities incurred in the capacity as a director or officer of the Group.
Indemnification and insurance of auditor
During the year, the Group has not indemnified or agreed to indemnify the auditor of the Company.
Proceedings on behalf of the 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.
16
For personal use only Non-audit Services
The Board of Directors is satisfied that the provision of non-audit services during the year is compatible with the general
standard of independence for auditors imposed by the Corporations Act 2001. The directors are satisfied that the services
disclosed below did not compromise the external auditor’s independence as the nature of the services provided does not
compromise the general principles relating to auditor independence in accordance with APES 110: Code of Ethics for
Professional Accountants set by the Accounting Professional and Ethical Standards Board.
During FY2019, the Company incurred investigating accountant’s fees payable to Hall Chadwick Corporate (NSW) Limited
of $20,000 pertaining to the preparation of the prospectus for the Company’s listing on the ASX.
Auditor’s Independence Declaration
The lead auditor’s independence declaration for the year ended 31 December 2019 has been received and can be found
on page 30 of the financial report.
Options
At the date of this report, the unissued ordinary shares of OpenLearning Limited under option are as follows:
GRANT DATE
DATE OF EXPIRY
EXERCISE PRICE
NUMBER UNDER OPTION
9 December 2019
9 December 2021
9 December 2019
9 December 2022
9 December 2019
9 December 2022
$0.20
$0.20
$0.30
30,833,307
2,793,333
5,000,000
Option holders do not have any rights to participate in any issues of shares or other interests of the Company or any
other entity.
For details of options issued to directors and executives as remuneration, refer to the remuneration report.
During FY2019, a subsidiary of the Company, OLG Australia Investors Pte Ltd, issued a total of 89,589 ordinary shares
arising from the exercise of employee share option plan. These shares were issued at the exercise prices per share of
$0.10, $1.77 and $2.35.
Other than the above, there have been no options granted over unissued shares or interests of any controlled entity within
the Group during or since the end of the reporting period.
Performance rights
As at the date of this report there were 2,750,000 performance rights convertible to shares on 1:1 basis on issue (2018: Nil).
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Directors’ Report
Continued
Information Relating to Directors and
Company Secretary
Kevin Barry
Non-Executive Chairman
Qualifications
B.Comm, LLB
Experience
Kevin Barry is a director of TCAP Australia and Thakral
Capital Holdings. His responsibilities include execution of
investment opportunities, oversight and management of
development projects, origination of senior construction
and investment finance. Kevin is also the TCAP group
representative director for the GemLife retirement business.
Kevin has over 24 years’ experience in law, property
finance and funds management. Initially he started as a
structured finance lawyer in Sydney with KPMG & Blake
Dawson, and then London with Norton Rose. In 2001, he
moved to investment banking at Zurich Capital Markets
Asia where he was Senior Vice President responsible for
the structuring and execution of their principal finance
business. He subsequently managed CHOPIN structured
finance business whose primary activities included
originating fixed income products across various asset
classes. Prior to joining the TCAP group, Kevin was
involved in setting up the credit strategies funds
management business at Pengana Capital. Since 2010,
Kevin has been on the Board as Chairman of the ASX
listed ICS Global Limited (ASX: ICS).
Interest in Shares and Options
1,839,788 fully paid ordinary shares
Options to acquire a further 1,534,225 ordinary shares
Special Responsibilities
Member of Audit Committee
Adam Brimo
Managing Director and Group CEO
Qualifications
B.Eng (Software), B.Arts (Politics)
Experience
Adam Brimo is listed in the 2017 Forbes 30 Under 30 Asia
for Consumer Technology and in The Pearcey Foundation
2018 NSW Tech Entrepreneur Hall of Fame.
Adam previously worked at Macquarie Bank as a Software
Engineer in the Fixed Income, Currencies and Commodities
Group and at Westpac Institutional Bank as a Senior
Software Engineer.
In 2010-2011, Adam led the successful Vodafail consumer
activist campaign, which resulted in nationwide media
coverage, an ACMA inquiry and a $1bn network upgrade
for Vodafone’s Australian business. Adam was named the
Consumer Activist of the Year in 2011 by Choice Magazine
for his transformative impact on the telecommunications
sector in Australia.
In 2012, Adam joined UNSW Professor Richard Buckland
and David Collien to found OpenLearning.com, a social
learning platform. Since that time, over 1.65 million
students have joined courses, including the first massive
open online courses (MOOCs) from Australia and Malaysia.
Interest in Shares and Options
6,532,475 fully paid ordinary shares
Options to acquire a further 126,358 ordinary shares
Performance rights to allow conversion to 2,000,000
ordinary shares
Special Responsibilities
Group CEO
Directorships held in other listed entities during the
three years prior to the current year
Current director of ICS Global Limited (since 23 July 2010)
Directorships held in other listed entities during the
three years prior to the current year
None
18
For personal use only Professor Beverley Oliver
Non-Executive Director
David Buckingham
Non-Executive Director
Qualifications
BA( (Hons), M.Phil PhD W.Aust, GradDipEd Murdoch,
GAICD PFHEA
Experience
Emeritus Professor Beverley Oliver is an education change
leader, a Principal Fellow of the Higher Education Academy,
and an Australian National Teaching Fellow. She works
as a higher education consultant and researcher in areas
such as digital education, micro-credentials, curriculum
transformation, quality assurance and graduate employability.
She is the founder and editor of the Journal of Teaching
and Learning for Graduate Employability.
Beverley was Deputy Vice-Chancellor Education at
Deakin University (2013-2018), Deputy Chair of Universities
Australia’s Deputy Vice-Chancellors (Academic) (2018) and
Deputy Chair of the Board of EduGrowth, a not-for-profit
entity and Australia’s acceleration network for high-growth,
scalable, borderless education (2016-18).
Beverley’s leadership has been recognised through two
national Citations for Outstanding Contributions to Student
Learning and several nationally funded grants and two
fellowships. In 2017, she was awarded Deakin University’s
highest honour, the title of Alfred Deakin Professor, for her
outstanding and sustained contribution to conceptualising
the strategic enhancement of courses in the digital
economy and furthering Deakin University’s research
and scholarship in the field of higher education.
Interest in Shares and Options
Options to acquire 1,000,000 ordinary shares
Special Responsibilities
Member of Remuneration Committee
Directorships held in other listed entities during
the three years prior to the current year
None
Qualifications
Engineering Science B.Tech (Hons), ACA ICAEW, GAICD
Experience
David Buckingham was most recently the Group CEO
and Managing Director of Navitas (ASX: NVT) from
2018-2019 and the CFO from 2016-2018.
David has a diverse educational background and
impressive career which he began in the United Kingdom
with PricewaterhouseCoopers. He later moved into the
telecommunications industry to which he devoted much
of his career. He has worked for Telewest Global as the
Group Treasurer and Director of Financial Planning,
Virginmedia, as Finance Director Business Division and
iiNet where he held the roles of Chief Financial Officer
and Chief Executive Officer between 2008 and 2015.
Interest in Shares and Options
416,666 fully paid ordinary shares
Options to acquire a further 1,416,666 ordinary shares
Performance rights to allow conversion to 750,000
ordinary shares
Special Responsibilities
Member of Audit Committee
Directorships held in other listed entities during the
three years prior to the current year
Navitas Limited (Appointed 1 July 2018; Resigned
5 July 2019)
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Directors’ Report
Continued
Spiro Pappas
Non-Executive Director
Qualifications
B.Comm (Merit), AICD
Maya Hari
Non-Executive Director
Qualifications
MBA, MS Engineering
Experience
Spiro Pappas is a former senior executive of NAB.
In his almost 10 years at NAB, Spiro performed several
leadership roles including Executive General Manager of
Global Institutional Banking, CEO of Asia and Executive
General Manager of International and Innovation.
Prior to NAB, Spiro spent over 2 years in London and
New York with Deutsche Bank and then 11 years in London
with ABN AMRO/RBS where he managed a number of
global businesses including Debt Capital Markets, Client
Coverage for Financial Institutions and Corporate Finance
and Advisory.
Spiro has also served on the Advisory Board of both
the Australia China Business Council and the Australia
Japan Business Cooperation Council and is a Board
Member of the European Australian Business Council.
He is currently the Chairman of Atlas Iron, ASX-listed
Splitit (a global payments Fintech) and Cognian
Technologies (an innovative Australian wireless lighting
technology company).
Spiro was also recently a member of a taskforce advising
the Federal Government on how to enable the SME sector
for the digital age.
Experience
Maya Hari is the VP & Managing Director, Asia Pacific
at Twitter. Asia Pacific has been the growth engine for
Twitter in recent years. Maya’s focus has been to fuel
Twitter strategy and rapid growth in key markets such
as China, India, Australia and Indonesia. Maya brings
diverse business experience having led functions in
Sales, Marketing & Product Management. She serves
as Chairperson of TIE in Singapore (Non-Profit focused
on fuelling the entrepreneurial ecosystem).
Prior to Twitter, Maya spent 16+ years in the digital
media, mobile and eCommerce in the US and in Asia
Pacific region for brands such as Google, Samsung,
Microsoft & Cisco. She was also responsible for the digital
transformation & re-engineering of media powerhouse
Conde Nast in Asia – launching and bringing internet
and mobile offerings for top tier publication titles such
as Vogue, GQ and Condé Nast Traveller.
Interest in Shares and Options
Options to acquire 1,000,000 ordinary shares
Special Responsibilities
Member of Remuneration Committee
Interest in Shares and Options
3,679,091 fully paid ordinary shares
Options to acquire a further 1,547,508 ordinary shares
Directorships held in other listed entities during
the three years prior to the current year
None
Special Responsibilities
Member of Audit Committee
Justyn Stedwell
Company Secretary
Directorships held in other listed entities during the
three years prior to the current year
Current director of Splitit Payments Ltd (since
20 January 2019)
Qualifications
Bachelor of Business and Commerce (Management and
Economics) – Monash University, Graduate Diploma of
Accounting – Deakin University, Graduate Diploma of
Applied Corporate Governance – Governance Institute
of Australia , Graduate Certificate of Applied Finance
– Kaplan Professional
Experience
Company Secretary with over 13 years’ experience as a
Company Secretary of ASX listed companies in various
industries including IT and telecommunications, mining
and exploration, biotechnology and agriculture.
20
For personal use only Meetings of Directors
There were no meetings of directors held during the financial year as the full board was only constituted upon the
Company being admitted to the official list of the ASX on 10 December 2019. The Company’s shares commenced
trading on the ASX on 12 December 2019.
Remuneration Report
The Remuneration Report for Non-Executive Directors, Executive Director and other Key Management Personnel
have been prepared under the following main headings:
(i) Remuneration policy
(ii) Details of remuneration
(iii) Service agreements
(iv) Share-based remuneration
(v) Other information
(i) Remuneration Policy
The remuneration policy of the Group has been designed:
• to align rewards to business outcomes that deliver value to shareholders
• to create a high performance culture by setting challenging objectives and rewarding individuals based on
performance targets met
• to ensure remuneration is competitive in line with market to motivate and retain executive talent
The Board has established a Remuneration Committee which is responsible for determining and reviewing remuneration
arrangements for the Directors and the executive team.
The remuneration structure adopted by the Group consists of the following components:
• fixed remuneration being annual salary; and
• short term incentives, being employee share schemes and bonuses for selected executives.
The payment of bonuses, share options, performance rights and other incentive payments are reviewed by the
Remuneration Committee annually and a recommendation is put to the Board for approval. All bonuses, options,
performance rights and incentives are linked to pre-determined performance criteria.
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Directors’ Report
Continued
(ii) Details of remuneration
The remuneration for key management personnel (KMP) of the Group during the year was as follows:
SHORT-TERM BENEFITS
Salary
and
Fees
$
Profit
Share and
Bonuses
$
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018(1)
2019
2018
2019
2018
2019
2018
2019
2018
166,461
178,219
3,442
–
2,692
–
2,459
–
2,459
–
19,658
10,834
224,231
88,846
74,019
54,561
142,703
125,001
133,884
130,000
772,008
587,461
50,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
50,000
–
Non-
monetary
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Leave
and
Other
$
28,600
20,870
–
–
–
–
–
–
–
–
–
–
15,911
7,723
4,902
3,322
11,589
39,196
11,598
9,013
72,600
80,124
POST-EMPLOYMENT
BENEFITS
LONG-TERM
BENEFITS
EQUITY-SETTLED
SHARE-BASED PAYMENTS
Pension
and Super-
annuation
Other
Incentive
Plans
LSL
Shares/
Units
Options/
Rights
CASH-
SETTLED
SHARE-
BASED
PAYMENTS
TERMIN-
ATION
BENEFITS
23,281
16,931
327
$
–
–
–
–
–
–
–
234
234
22,813
8,440
10,221
7,521
14,658
11,875
13,821
12,350
85,589
57,117
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
191,667
31,632
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
31,632
31,632
31,632
31,632
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
191,667
158,160
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
TOTAL
$
268,342
216,020
35,401
225,991
–
–
–
–
34,325
34,325
51,290
10,834
262,955
105,009
89,142
65,404
168,950
176,072
159,303
151,363
1,330,024
724,702
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Executive Director
Adam Brimo
Non-Executive Directors
Kevin Barry
Spiro Pappas
David Buckingham
Professor Beverley Oliver
Maya Hari
Other KMP
Cherie Diaz
Sarveen Kandiah
David Collien
Huat Koh
Total KMP
(1) Cherie Diaz – joined 30 July 2018.
22
For personal use only (ii) Details of remuneration
The remuneration for key management personnel (KMP) of the Group during the year was as follows:
SHORT-TERM BENEFITS
Profit
Share and
Bonuses
Non-
monetary
Salary
and
Fees
$
166,461
178,219
50,000
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018
2019
2018(1)
2019
2018
2019
2018
2019
2018
2019
2018
3,442
2,692
2,459
2,459
–
–
–
–
19,658
10,834
224,231
88,846
74,019
54,561
142,703
125,001
133,884
130,000
772,008
587,461
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
50,000
Leave
and
Other
$
28,600
20,870
–
–
–
–
–
–
–
–
–
–
15,911
7,723
4,902
3,322
11,589
39,196
11,598
9,013
72,600
80,124
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
POST-EMPLOYMENT
BENEFITS
LONG-TERM
BENEFITS
EQUITY-SETTLED
SHARE-BASED PAYMENTS
Pension
and Super-
annuation
$
23,281
16,931
327
–
–
–
234
–
234
–
–
–
22,813
8,440
10,221
7,521
14,658
11,875
13,821
12,350
85,589
57,117
Other
Incentive
Plans
LSL
Shares/
Units
Options/
Rights
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
$
–
–
31,632
–
191,667
31,632
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
31,632
–
31,632
–
31,632
–
–
–
–
–
–
–
–
–
191,667
158,160
–
–
CASH-
SETTLED
SHARE-
BASED
PAYMENTS
TERMIN-
ATION
BENEFITS
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
$
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
TOTAL
$
268,342
216,020
35,401
–
225,991
–
34,325
–
34,325
–
51,290
10,834
262,955
105,009
89,142
65,404
168,950
176,072
159,303
151,363
1,330,024
724,702
Executive Director
Adam Brimo
Non-Executive Directors
Kevin Barry
Spiro Pappas
David Buckingham
Professor Beverley Oliver
Maya Hari
Other KMP
Cherie Diaz
Sarveen Kandiah
David Collien
Huat Koh
Total KMP
(1) Cherie Diaz – joined 30 July 2018.
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Directors’ Report
Continued
(iii) Service agreements
Remuneration and other terms of employment for the
Executive Director and other key management personnel
are formalised in a Service Agreement. The major
provisions of the agreements relating to remuneration
are set out below:
(a) Adam Brimo (Managing Director and Group CEO)
Adam is paid a base salary of $200,000 per annum
(plus superannuation). In addition to the base salary,
Adam was paid a $50,000 cash bonus when the Company
was admitted to the official list of ASX. He is also entitled
to an incentive bonus of up to $75,000 payable based
on achieving selected and verified performance criteria
and 2,000,000 performance rights.
(b) Cherie Diaz (Managing Director, Australia)
Cherie is paid a base salary of $220,000 per annum
(plus superannuation). In addition to the base salary,
Cherie is entitled to an incentive bonus of up to $80,000
payable based on achieving selected and verified
performance criteria.
(c) Sarveen Kandiah (Managing Director, Malaysia)
Sarveen is paid a base salary of MYR300,000 per annum.
In addition to the base salary, Sarveen is entitled to an
incentive bonus of up to MYR100,000 payable based on
achieving selected and verified performance criteria.
(iv) Share-based remuneration
All options refer to options over ordinary shares of the
Company, which are exercisable on a one-for-one basis
under the terms of the agreements.
Options were granted to the Directors during the year
with the following key conditions:
• amount payable upon exercise of each option is $0.30
• option will expire three (3) years following their date
of issue
• an option not exercised before the expiry date will
automatically lapse on the expiry date.
Performance rights were issued to 2 directors,
Adam Brimo and David Buckingham, during the year.
These performance rights shall vest (following which the
holder of the performance rights may elect to convert
the performance rights into ordinary shares of the
Company) upon satisfaction of the following milestones:
• 50% of the performance rights held by each holder
will vest in the event that the annual recurring revenue
of the Group is equal to or greater than $4,000,000
as at 31 December 2020; and
• 50% of the performance rights held by each holder
will vest in the event that the annual recurring revenue
of the Group is equal to or greater than $8,000,000
as at 31 December 2021,
(d) David Collien
David is paid a base salary of $150,000 per annum
(including superannuation). There is no incentive bonus
element in David’s service agreement.
and the relevant annual recurring revenue being
confirmed by the signed attestation of a registered
company auditor or is properly included in the
Company’s audited financial statements.
(e) Huat Koh
Huat is paid a base salary of $160,000 per annum (including
superannuation). There is no incentive bonus element in
Huat’s service agreement.
All the above service agreements otherwise contain
customary terms for an agreement of such nature, including
in relation to intellectual property being the property of the
Group, restraint of trade and confidentially. The service
agreements stipulate a range of two to three-month
resignation periods.
24
For personal use only Options and rights granted as remuneration
GRANT DETAILS
EXERCISED
LAPSED
Balance at
Beginning
of Year
Issue Date
No.
Value
$
(Note 1)
No.
Value
$
Balance at
End of Year
No.
No.
Options
Kevin Barry
Spiro Pappas
David
Buckingham
Professor
Beverley Oliver
Maya Hari
Performance rights
Adam Brimo
David
Buckingham
–
–
–
–
–
–
–
–
–
9/12/2019
1,000,000
31,632
9/12/2019
1,000,000
31,632
9/12/2109
1,000,000
31,632
9/12/2019
1,000,000
31,632
9/12/2019
1,000,000
31,632
5,000,000
158,160
9/12/2019
2,000,000
9/12/2019
750,000
2,750,000
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
5,000,000
2,000,000
750,000
2,750,000
Note 1
The fair value of options granted as remuneration 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 necessary for vesting are satisfied.
The performance rights are subject to non-market vesting conditions, accordingly no value has been recognised as the Company
have not assessed that the condition is likely to be met at this point and will be reassessed at future reporting dates.
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For personal use only
Directors’ Report
Continued
Group KMP
Options
Kevin Barry
Spiro Pappas
David Buckingham
Professor Beverley Oliver
Maya Hari
Performance rights
Adam Brimo
David Buckingham
Balance at
End of Year
No.
Exercisable
No.
VESTED
UNVESTED
Unexer-
cisable
No.
(Note 2)
Total at
End of Year
No.
Total at
End of Year
No.
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
5,000,000
2,000,000
750,000
2,750,000
–
–
–
–
–
–
–
–
–
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
5,000,000
5,000,000
–
–
–
–
–
–
–
–
–
–
–
–
2,000,000
750,000
2,750,000
Note 2
The exercise period for the vested options is subject to escrow period imposed by the ASX.
Description of Options/Rights Issued as Remuneration
Details of the options and performance rights granted as remuneration to those KMP listed in the previous table are as follows:
GRANT DATE
ISSUER
ENTITLEMENT
ON EXERCISE
DATES EXERCISABLE
VALUE
PER OPTION
AT GRANT
DATE
$
AMOUNT
PAID/
PAYABLE BY
RECIPIENT
$
EXERCISE
PRICE
$
9 December 2019
Company
5,000,000
ordinary shares
Within 3 years following
grant date
0.30
0.032
1,500,000
9 December 2019
Company
2,750,000
ordinary shares
Following satisfaction
of revenue milestones
and within 5 years
following grant date
–
–
–
Option values at grant date were determined using the Black-Scholes method.
No value has been recognised for the performance rights. An assessment of the performance criteria was carried out
and the criteria were not met.
26
For personal use only (v) Other information
The number of ordinary shares in the Company during the year held by each of the Group’s key management personnel,
including their related parties, is set out below:
Adam Brimo
Kevin Barry
Spiro Pappas
David Buckingham
Professor Beverley Oliver
Maya Hari
Cherie Diaz
Sarveen Kandiah
David Collien
Huat Koh
Total
BALANCE AT
BEGINNING
OF YEAR
GRANTED AS
REMUNERATION
DURING THE
YEAR
ISSUED ON
EXERCISE OF
OPTIONS
DURING THE
YEAR
OTHER
CHANGES
DURING THE
YEAR(1)
BALANCE AT
END OF YEAR
–
–
–
–
–
–
–
–
–
–
–
–
–
958,333
–
–
–
–
–
–
–
958,333
–
–
–
–
–
–
–
–
–
–
–
6,532,475
6,532,475
1,839,788
1,839,788
2,720,758
3,679,091
416,666
416,666
–
–
–
–
504,209
504,209
177,945
177,945
3,556,743
3,556,743
152,523
152,523
15,901,107
16,859,440
(1) Pursuant to a corporate reorganisation as disclosed under the caption ‘Significant changes in the state of affairs’ in this
directors’ report.
There were no other transactions conducted between the Group and KMP or their related parties, apart from those
disclosed above relating to equity and compensation, that were conducted other than in accordance with normal
employee, customer or supplier relationships on terms no more favourable than those reasonably expected under
arm’s length dealings with unrelated persons.
This directors’ report, incorporating the remuneration report, is signed in accordance with a resolution of the Board
of Directors.
Adam Brimo
Managing Director
Dated: 27 March 2020
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28
For personal use only Securing our
future with 21st
century skills.
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Auditor’s Independence Declaration
30
For personal use only Financial
Report
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Consolidated statement of profit or loss
For the financial year ended 31 December 2019
Revenue
Other income
Items of expense
Web-hosting and other direct costs
Employee benefits expense
Depreciation
Promotional and advertising
Professional services
General and administrative costs
Pre-IPO and IPO-related costs
Finance income
Finance expenses
Loss before tax
Income tax benefit
Loss for the year
Loss for the year attributable to:
Owners of the Company
Earnings/(losses) per share attributable to owners of the Company
Basic earnings/(losses) per share (cents)
Diluted earnings/(losses) per share (cents)
NOTE
3
4
5
6
9
9
2019
$
2018
$
1,602,613
1,765,095
18,638
65,560
(394,814)
(495,647)
(4,602,273)
(4,260,979)
(62,859)
(121,114)
(242,663)
(822,856)
(3,070,710)
(7,696,038)
7,131
(31,044)
(23,962)
(236,744)
(338,100)
(1,041,390)
–
(4,566,167)
29,963
(11,686)
(7,719,951)
(4,547,890)
–
156,263
(7,719,951)
(4,391,627)
(7,719,951)
(4,391,627)
(5.53)
(5.53)
(13.83)
(13.83)
This statement should be read in conjunction with the notes to the financial statements.
32
For personal use only Consolidated statement of comprehensive
income
For the financial year ended 31 December 2019
Loss for the year
Other comprehensive income:
Item that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations
Total comprehensive loss for the year
Attributable to:
Owners of the Company
This statement should be read in conjunction with the notes to the financial statements.
2019
$
2018
$
(7,719,951)
(4,391,627)
(4,122)
17,727
(7,724,073)
(4,373,900)
(7,724,073)
(4,373,900)
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Consolidated statement of financial position
As at 31 December 2019
ASSETS
Current assets
Trade and other receivables
Prepayments
Cash and cash equivalents
Non-current assets
Furniture, fittings and equipment
Intangible assets
Right-of-use asset
Total assets
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables
Provisions
Lease liability
Borrowing
Deferred revenue
Net current assets
Non-current liability
Lease liability
Other payables
Convertible preference shares
Total liabilities
Net assets
NOTE
2019
$
2018
$
10
11
12
13
14
15
16
18
15
17
551,580
226,576
7,740,768
8,518,924
62,392
453,341
349,405
865,138
9,384,062
793,582
143,650
132,191
17,727
572,737
1,659,887
6,859,037
250,884
199,927
–
450,811
2,110,698
7,273,364
566,698
130,708
1,076,732
1,774,138
107,660
301,412
–
409,072
2,183,210
308,872
193,468
–
–
421,271
923,611
850,527
–
–
9
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923,620
1,259,590
Equity attributable to the owners of the Company
Share capital
Accumulated losses
Reserves
Total equity
19
23,233,194
12,937,238
(19,413,440)
(11,693,489)
20
3,453,610
7,273,364
15,841
1,259,590
This statement should be read in conjunction with the notes to the financial statements.
34
For personal use only Consolidated statement of changes in equity
For the financial year ended 31 December 2019
Opening balance at 1 January 2019
12,937,238
15,841
(11,693,489)
1,259,590
SHARE
CAPITAL
(NOTE 19)
OTHER
RESERVES
(NOTE 20)
ACCUMULATED
LOSSES
$
$
$
TOTAL
$
Loss for the year
Other comprehensive income
Foreign currency translation, representing total
other comprehensive income/(loss) for the year
Total comprehensive loss for the year
Conversion of convertible preference shares
Valuation of employee share plan
Exercise of employee share plan
Issuance of ordinary shares :
– pursuant to conversion of convertible notes
– issuance to advisors and a director
– pursuant to initial public offering of shares
Equity issuance costs
–
–
–
9
824,606
96,863
3,700,000
766,667
8,000,000
(1,441,712)
–
(7,719,951)
(7,719,951)
(4,122)
–
(4,122)
(4,122)
(7,719,951)
(7,724,073)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
9
824,606
96,863
3,700,000
766,667
8,000,000
(1,441,712)
–
1,791,414
Fair value adjustment on shares issued
(1,650,477)
1,650,477
Valuation of options issued
–
1,791,414
Closing balance at 31 December 2019
23,233,194
3,453,610
(19,413,440)
7,273,364
This statement should be read in conjunction with the notes to the financial statements.
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Consolidated statement of changes in equity
For the financial year ended 31 December 2019
SHARE
CAPITAL
(NOTE 19)
OTHER
RESERVES
(NOTE 20)
ACCUMULATED
LOSSES
$
$
$
TOTAL
$
Opening balance at 1 January 2018
8,189,487
(1,886)
(7,301,862)
885,739
Loss for the year
Other comprehensive income
Foreign currency translation, representing total
other comprehensive income/(loss) for the year
Total comprehensive loss for the year
–
–
–
–
(4,391,627)
(4,391,627)
17,727
–
17,727
17,727
(4,391,627)
(4,373,900)
Issuance of shares
Equity issuance costs
5,550,000
(802,249)
–
–
–
–
5,550,000
(802,249)
Closing balance at 31 December 2018
12,937,238
15,841
(11,693,489)
1,259,590
This statement should be read in conjunction with the notes to the financial statements.
36
For personal use only Consolidated statement of cash flows
For the financial year ended 31 December 2019
Operating activities
Receipts from customers
Payments to suppliers and employees
Proceeds from other income
Net cash flows used in operating activities
Investing activities
Purchase of furniture, fittings and equipment, net of disposal
Purchase of intangible assets
Net cash flows used in investing activities
Financing activities
Proceeds from issuance of equity shares
Proceeds from issuance of convertible notes
Proceeds from exercise of employee share options
Proceeds from issuance of convertible preference shares
Proceeds from borrowing, net of repayment
Payments for pre-IPO and IPO costs
Share issue expenses
Net cash flows generated from financing activities
Net increase / (decrease) in cash and cash equivalents
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents at beginning of the year
Cash and cash equivalents at end of the year
NOTE
2019
$
2018
$
2,242,609
(6,135,369)
18,638
1,864,139
(6,474,247)
65,560
24
(3,874,122)
(4,544,548)
(45,589)
(101,691)
(147,280)
(74,201)
(240,006)
(314,207)
8,000,000
3,700,000
96,863
–
17,727
(618,334)
(511,401)
10,684,855
6,663,453
583
1,076,732
7,740,768
5,550,000
–
–
8
–
–
(802,249)
4,747,759
(110,996)
5,234
1,182,494
1,076,732
11
This statement should be read in conjunction with the notes to the financial statements.
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38
For personal use only Educating
the world,
one course
at a time.
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For personal use only
Notes to the financial statements
31 December 2019
The consolidated financial statements and notes represent
those of OpenLearning Limited and its Controlled Entities
(the Group).
The separate financial statements of the Parent Entity,
OpenLearning Limited, have not been presented within this
financial report as permitted by the Corporations Act 2001.
The financial statements were authorised for issue on
27 March 2020 by the directors of the Company.
1.3 Principles of consolidation
The consolidated financial statements incorporate all of the
assets, liabilities and results of the Parent (OpenLearning
Limited) and all of the subsidiaries (including any structured
entities). Subsidiaries are entities the Parent controls. The
Parent controls an entity when it is exposed to, or has rights
to, variable returns from its involvement with the entity and
has the ability to affect those returns through its power over
the entity. A list of the subsidiaries is provided in Note 22.
1. Summary of significant accounting policies
1.1 Basis of preparation
These general purpose consolidated financial statements
have been prepared in accordance with the Corporations
Act 2001, Australian Accounting Standards and
Interpretations of the Australian Accounting Standards
Board and in compliance with International Financial
Reporting Standards as issued by the International
Accounting Standards Board. The Group is a for-profit
entity for financial reporting purposes under 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.
Except for cash flow information, the financial statements
have been prepared on an accrual 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.
1.2 Going concern
The financial statements have been prepared on the going
concern basis which assumes the Company and the Group
will have sufficient cash to pay its debts, as and when they
become payable, for a period of at least 12 months from the
date the financial report was authorised for issue.
The Group has incurred a net loss after tax of $7,719,951
(2018: $4,391,627) for the financial year ended
31 December 2019. During the financial year the Group
also had net cash outflows from operating activities of
$3,874,122 (2018: $4,544,548).
The admission of the Company to the official list of
the ASX on 10 December 2019 raised total proceeds
of $8.0 million for the Group. The Company believes
that the proceeds raised from the IPO, together with the
on-going sales collection, will enable the continuation
of its business. Therefore, the financial statements do not
include adjustments relating to the recoverability and
classification of recorded asset amounts, nor to the
amounts and classification of liabilities that might be
necessary should the Company and the Group not
continue as going concerns.
Intercompany transactions, balances and unrealised gains
or losses on transactions between Group entities are fully
eliminated on consolidation. Accounting policies of
subsidiaries have been changed and adjustments made
where necessary to ensure uniformity of the accounting
policies adopted by the Group.
Where applicable, equity interests in a subsidiary not
attributable, directly or indirectly, to the Group are
presented as “non-controlling interests”. The Group
initially recognises non-controlling interests that are
present ownership interests in subsidiaries and are entitled
to a proportionate share of the subsidiary’s net assets on
liquidation at either fair value or at the non-controlling
interests’ proportionate share of the subsidiary’s net
assets. Subsequent to initial recognition, non-controlling
interests are attributed their share of profit or loss
and each component of other comprehensive income.
Non-controlling interests are shown separately within
the equity section of the statement of financial position
and statement of comprehensive income.
The consolidated financial statements of the Group
have been prepared in accordance with the pooling of
interest method as the Group is a continuation of the
existing business of OpenLearning Global Pte Ltd and its
subsidiaries. The assets and liabilities of the combining
entities are reflected at their carrying amounts as reported
in the consolidated financial statements. Any difference
between the consideration paid/transferred and the
equity acquired is reflected within equity as a common
control reserve. The consolidated income statements and
consolidated statements of comprehensive income reflect
the results of the combining entities for the entire periods
under review, irrespective of when the combination took
place. Apart from the above, subsidiaries are consolidated
from the date of acquisition, being the date on which the
Group obtains control, and continue to be consolidated
until the date that such control ceases.
1.4 Functional and presentation currency
The functional currency of each of the Group’s entities
is the currency of the primary economic environment in
which that entity operates. The consolidated financial
statements are presented in Australian dollars, which
is the Parent Entity’s functional currency.
40
For personal use only 1. Summary of significant accounting policies
(cont’d)
1.4 Functional and presentation currency (cont’d)
Transactions and balances
Foreign currency transactions are translated into the
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 exchange
differences that arise from net investment hedges.
Exchange differences arising on the translation of
non-monetary items are recognised directly in other
comprehensive income to the extent that the underlying
gain or loss is recognised in other comprehensive income;
otherwise the exchange difference is recognised in profit
or loss.
Group companies
The financial results and position of foreign operations,
whose functional currency is different from the Group’s
presentation currency, are translated as follows:
• assets and liabilities are translated at exchange rates
prevailing at the end of the reporting period;
•
income and expenses are translated at exchange
rates on the date of transaction; and
• all resulting exchange differences are recognised
in other comprehensive income.
Exchange differences arising on translation of foreign
operations with functional currencies other than Australian
dollars are recognised in other comprehensive income
and included in the foreign currency translation reserve
in the statement of financial position and allocated to
non-controlling interest where relevant. The cumulative
amount of these differences is reclassified into profit or
loss in the period in which the operation is disposed of.
1.5 Furniture, fittings and equipment
All items of furniture, fittings and equipment are initially
recorded at cost. Subsequent to recognition, furniture,
fittings and equipment are measured at cost less
accumulated depreciation and any accumulated
impairment losses.
Depreciation is computed on a straight-line basis over the
estimated useful lives of the assets as follows:
Computer
Office equipment
Leasehold improvement
60 months
60 months
60 months
The carrying values of furniture, fittings and equipment
are reviewed for impairment when events or changes in
circumstances indicate that the carrying value may not
be recoverable.
The residual value, useful life and depreciation method
are reviewed at each financial year-end, and adjusted
prospectively, if appropriate.
An item of furniture, fittings and equipment is
derecognised upon disposal or when no future economic
benefits are expected from its use or disposal. Any gain
or loss on de-recognition of the asset is included in
profit or loss in the year the asset is derecognised.
1.6 Intangible assets
Intangible assets acquired separately are measured
initially at cost. Following initial acquisition, intangible
assets are carried at cost and where applicable, less
any accumulated amortisation and/or any accumulated
impairment losses. Internally generated intangible
assets, excluding capitalised development costs, are
not capitalised and expenditure is reflected in profit
or loss in the year in which the expenditure is incurred.
The useful lives of intangible assets are assessed as either
finite or indefinite.
Intangible assets with finite useful lives are amortised over
the estimated useful lives and assessed for impairment
whenever there is an indication that the intangible asset may
be impaired. The amortisation period and the amortisation
method are reviewed at least at each financial year-end.
Changes in the expected useful life or the expected pattern
of consumption of future economic benefits embodied in
the asset is accounted for by changing the amortisation
period or method, as appropriate, and are treated as
changes in accounting estimates.
Intangible assets with indefinite useful lives or not yet
available for use are tested for impairment annually, or
more frequently if the events and circumstances indicate
that the carrying value may be impaired either individually
or at the cash-generating unit level. Such intangible assets
are not amortised. The useful life of an intangible asset
with an indefinite useful life is reviewed annually to
determine whether the useful life assessment continues
to be supportable. If not, the change in useful life from
indefinite to finite is made on a prospective basis.
Gains or losses arising from de-recognition of an intangible
asset are measured as the difference between the net disposal
proceeds and the carrying amount of the asset and are
recognised in profit or loss when the asset is derecognised.
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Notes to the financial statements
Continued
1. Summary of significant accounting policies
(cont’d)
1.6 Intangible assets (cont’d)
(i) Domain names and trademarks
Domain names and trademarks are recognised at cost
of acquisition. They are considered to have an infinite
life and are carried at cost less any impairment losses.
(ii) Computer software
Computer software is recorded at cost. Where software
is acquired at no cost, or for a nominal cost, the cost is its
fair value as at the date of acquisition. It has a finite life and
is carried at cost less accumulated amortisation and any
impairment losses. Software has an estimated useful life
of ten years. Any costs incurred to improve the software
after acquisition is expensed to the profit or loss. It is
assessed annually for impairment.
1.7 Impairment of non-financial assets
The Group assesses at each reporting date whether there is
an indication that an asset may be impaired. If any indication
exists, or when an annual impairment testing for an asset is
required, the Group makes an estimate of the asset’s
recoverable amount.
An asset’s recoverable amount is the higher of an asset’s
or cash-generating unit’s fair value less costs of disposal
and its value in use and is determined for an individual
asset, unless the asset does not generate cash inflows
that are largely independent of those from other assets or
groups of assets. Where the carrying amount of an asset
or cash-generating unit exceeds its recoverable amount,
the asset is considered impaired and is written down to
its recoverable amount.
Impairment losses of continuing operations are recognised
in profit or loss, except for assets that are previously
revalued where the revaluation was taken to other
comprehensive income. In this case, the impairment is also
recognised in other comprehensive income up to the
amount of any previous revaluation.
A previously recognised impairment loss is reversed
only if there has been a change in the estimates used to
determine the asset’s recoverable amount since the last
impairment loss was recognised. If that is the case, the
carrying amount of the asset is increased to its recoverable
amount. That increase cannot exceed the carrying amount
that would have been determined, net of depreciation,
had no impairment loss been recognised previously.
Such reversal is recognised in profit or loss unless the
asset is measured at revalued amount, in which case the
reversal is treated as a revaluation increase.
1.8 Financial instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised when
the Group becomes a party to the contractual provisions of
the instrument. For financial assets, this is equivalent to the
date that the Group commits itself to either the purchase or
the sale of the asset (ie trade date accounting is adopted).
Financial instruments (except for trade receivables) are
initially measured at fair value plus transaction 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. Where available, quoted
prices in an active market are used to determine fair value.
In other circumstances, valuation techniques are adopted.
Trade receivables are initially measured at the transaction
price if the trade receivables do not contain a significant
financing component or if the practical expedient was
applied as specified in paragraph 63 of AASB 15: Revenue
from Contracts with Customers.
Classification and subsequent measurement
Financial liabilities are subsequently measured at amortised
cost using the effective interest method. The effective
interest method is a method of calculating the amortised
cost of a debt instrument and of allocating interest expense
to profit or loss over the relevant period. The effective
interest rate is the internal rate of return of the financial
asset or liability. That is, it is the rate that exactly discounts
the estimated future cash flows through the expected life
of the instrument to the net carrying amount at initial
recognition.
Financial assets
Financial assets are subsequently measured at:
• amortised cost;
• fair value through other comprehensive income; or
• fair value through profit or loss.
Measurement is on the basis of two primary criteria:
• the contractual cash flow characteristics of the financial
asset; and
• the business model for managing the financial assets.
A financial asset that meets the following conditions is
subsequently measured at amortised cost:
• the financial asset is managed solely to collect
contractual cash flows; and
• the contractual terms within the financial asset give
rise to cash flows that are solely payments of principal
and interest on the principal amount outstanding on
specified dates.
A financial asset that meets the following conditions is
subsequently measured at fair value through other
comprehensive income:
• the contractual terms within the financial asset give rise
to cash flows that are solely payments of principal and
interest on the principal amount outstanding on
specified dates; and
• the business model for managing the financial asset
comprises both contractual cash flows collection and
the selling of the financial asset.
By default, all other financial assets that do not meet the
measurement conditions of amortised cost and fair value
through other comprehensive income are subsequently
measured at fair value through profit or loss.
42
For personal use only 1. Summary of significant accounting policies
(cont’d)
1.8 Financial instruments (cont’d)
Derecognition
Derecognition refers to the removal of a previously
recognised financial asset or financial liability from the
statement of financial position.
Derecognition of financial liabilities
A liability is derecognised when it is extinguished (ie when
the obligation in the contract is discharged, cancelled or
expires). An exchange of an existing financial liability for a
new one with substantially modified terms, or a substantial
modification to the terms of a financial liability, is treated as
an extinguishment of the existing liability and recognition
of a new financial liability.
The difference between the carrying amount of the
financial liability derecognised and the consideration paid
and payable, including any non-cash assets transferred or
liabilities assumed, is recognised in profit or loss.
Derecognition of financial assets
A financial asset is derecognised when the holder’s
contractual rights to its cash flows expires, or the asset
is transferred in such a way that all the risks and rewards
of ownership are substantially transferred.
All the following criteria need to be satisfied for the
derecognition of a financial asset:
• the right to receive cash flows from the asset has
expired or been transferred;
• all risk and rewards of ownership of the asset have
been substantially transferred; and
• the Group no longer controls the asset (ie it has no
practical ability to make unilateral decisions to sell
the asset to a third party).
• On derecognition of a financial asset measured at
amortised cost, the difference between the asset’s
carrying amount and the sum of the consideration
received and receivable is recognised in profit or loss.
1.9 Impairment
The Group recognises a loss allowance for expected credit
losses on financial assets that are measured at amortised
cost or fair value through other comprehensive income.
Loss allowance is not recognised for:
• financial assets measured at fair value through profit
or loss; or
• equity instruments measured at fair value through
other comprehensive income.
Expected credit losses are the probability-weighted
estimate of credit losses over the expected life of a financial
instrument. A credit loss is the difference between all
contractual cash flows that are due and all cash flows
expected to be received, all discounted at the original
effective interest rate of the financial instrument.
The Group uses the following approaches to impairment,
as applicable under AASB 9: Financial Instruments:
• the general approach; and
• the simplified approach.
General approach
Under the general approach, at each reporting period,
the Group assesses whether the financial instruments are
credit-impaired, and:
•
•
if the credit risk of the financial instrument has increased
significantly since initial recognition, the Group
measures the loss allowance of the financial instruments
at an amount equal to the lifetime expected credit
losses; and
if there has been no significant increase in credit risk
since initial recognition, the Group measures the loss
allowance for that financial instrument at an amount
equal to 12-month expected credit losses.
Simplified approach
The simplified approach does not require tracking
of changes in credit risk at every reporting period,
but instead requires the recognition of lifetime
expected credit loss at all times.
This approach is applicable to:
• trade receivables or contract assets that result from
transactions that are within the scope of AASB 15:
Revenue from Contracts with Customers, and which
do not contain a significant financing component; and
•
lease receivables.
•
In measuring the expected credit loss, a provision
matrix for trade receivables is used, taking into
consideration various data to get to an expected credit
loss (ie diversity of its customer base, appropriate
groupings of its historical loss experience, etc).
Recognition of expected credit losses in financial
statements
At each reporting date, the Group recognises the
movement in the loss allowance as an impairment
gain or loss in the statement of profit or loss and other
comprehensive income.
The carrying amount of financial assets measured at
amortised cost includes the loss allowance relating to
that asset.
Assets measured at fair value through other comprehensive
income are recognised at fair value with changes in
fair value recognised in other comprehensive income.
The amount in relation to change in credit risk is transferred
from other comprehensive income to profit or loss at every
reporting period.
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For personal use only
Notes to the financial statements
Continued
1. Summary of significant accounting policies
(cont’d)
1.10 Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and with
online payment providers, cash on hand and short-term
deposits that are readily convertible to known amount
of cash and which are subject to an insignificant risk of
changes in value.
1.11 Convertible preference shares
Convertible preference shares (“CPS”) are classified as
liabilities until conversion or maturity of the CPS. When the
conversion option is exercised, the carrying amount of the
conversion option will be taken to share capital. When the
conversion option is allowed to lapse, the carrying amount
of the conversion option will be taken to retained earnings.
1.12 Provisions
Provisions are recognised when the Group has a legal
or constructive obligation, as a result of past events, for
which it is probable that an outflow of economic benefits
will result and that outflow can be reliably measured.
Provisions are measured using the best estimate of the
amounts required to settle the obligation at the end of
the reporting period.
1.13 Employee benefits
Short-term employee benefits
Provision is made for the Group’s obligation for short-term
employee benefits. Short-term employee benefits are
benefits (other than termination benefits) that are expected
to be settled wholly before 12 months after the end of the
annual reporting period in which the employees render
the related service, including wages, salaries and sick
leave. Short-term employee benefits are measured at the
(undiscounted) amounts expected to be paid when the
obligation is settled.
The Group’s obligations for short-term employee benefits
such as wages, salaries and sick leave are recognised as
part of current trade and other payables in the statement of
financial position. The Group’s obligations for employees’
annual leave entitlements are recognised as provisions in
the statement of financial position.
Defined contribution benefits
All employees of the Group receive defined contribution
entitlements, for which the Group pays fixed contribution
to the employee’s superannuation fund of choice for the
employees in Australia and to a state pension fund for
the employees in Malaysia. 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 obligation for any
unpaid contributions at the end of the reporting period.
All obligations for unpaid contributions are measured 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.
Termination benefits
When applicable, the Group recognises a liability and
expense for termination benefits at the earlier of:
• the date when the Group can no longer withdraw the
offer for termination benefits; and
• when the Group recognises costs for restructuring
pursuant to AASB 137: Provisions, Contingent Liabilities
and Contingent Assets and the costs include
termination benefits.
In either case, unless the number of employees affected is
known, the obligation for termination benefits is measured
on the basis of the number of employees expected to be
affected. Termination benefits that are expected to be
settled wholly before 12 months after the annual reporting
period in which the benefits are recognised are measured
at the (undiscounted) amounts expected to be paid.
Equity-settled compensation
The Group operates an employee share and option plan.
Share-based payments to employees are measured at the
fair value of the instruments at grant date and amortised
over the vesting periods. The fair value of options is
determined using the Black-Scholes pricing model.
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.
1.14 Revenue
Revenue is recognised to the extent that it is probable
that the economic benefits will flow to the Group and the
revenue can be reliably measured, regardless of when the
payment is made. Revenue is measured at the fair value of
consideration received or receivable, taking into account
contractually defined terms of payment and excluding
taxes or duty. The following specific recognition criteria
must also be met before revenue is recognised:
(a) Platform SaaS fees
Revenue from platform SaaS fees is recognised over
the period during which customers are granted access
to the platform.
(b) Marketplace sales
Revenue from marketplace sales is recognised when
customers subscribe for the courses and the course is
delivered. For courses sold on behalf of third parties,
revenue is recognised based on revenue sharing
arrangements.
(c) Services sales
Revenue from the provision of services is recognised
by reference to the stage of completion of the transaction
at the end of the reporting period and where outcome
of the contract can be estimated reliably. Stage of
completion is determined with reference to the services
performed to date as a percentage of total anticipated
services to be performed. Where the outcome cannot
be estimated reliably, revenue is recognised only to the
extent that related expenditure is recoverable.
44
For personal use only 1. Summary of significant accounting policies
(cont’d)
1.14 Revenue (cont’d)
Platform SaaS fees and Services sold to customers in
advance, which are yet to be utilised, are recognised
initially in the balance sheet as deferred income
and released to revenue in line with the above
recognition criteria.
1.15 Taxes
(a) Current income tax
Current income tax assets and liabilities for the current
and prior periods are measured at the amount expected
to be recovered from or paid to the taxation authorities.
The tax rates and tax laws used to compute the amount
are those that are enacted or substantively enacted at the
end of the reporting period, in the countries where the
Group operates and generates taxable income.
Current income taxes are recognised in profit or loss except
to the extent that the tax relates to items recognised outside
profit or loss, either in other comprehensive income or directly
in equity. Management periodically evaluates positions
taken in the tax returns with respect to situations in which
applicable tax regulations are subject to interpretation
and establishes provisions where appropriate.
(b) Deferred tax
Deferred tax is provided using the liability method on
temporary differences at the end of the reporting period
between the tax bases of assets and liabilities and their
carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all temporary
differences, except:
•
In respect of deductible temporary differences
associated with investments in subsidiaries and
associate, deferred tax assets are recognised only
to the extent that it is probable that the temporary
differences will reverse in the foreseeable future and
taxable profit will be available against which the
temporary differences can be utilised.
The carrying amount of deferred tax assets is reviewed
at the end of each reporting period and reduced to the
extent that it is no longer probable that sufficient taxable
profit will be available to allow all or part of the deferred tax
asset to be utilised. Unrecognised deferred tax assets are
reassessed at the end of each reporting period and are
recognised to the extent that it has become probable
that future taxable profit will allow the deferred tax asset
to be recovered.
Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the year when the
asset is realised or the liability is settled, based on tax rates
(and tax laws) that have been enacted or substantively
enacted at the end of each reporting period.
Deferred tax relating to items recognised outside profit or
loss is recognised outside profit or loss. Deferred tax items
are recognised in correlation to the underlying transaction
either in other comprehensive income or directly in equity
and deferred tax arising from a business combination is
adjusted against goodwill on acquisition.
(c) Sales tax
The applicable sales taxes are the Goods and Services Tax
(GST) and the Sales and Service Tax (SST), depending on
the tax jurisdiction where the Group operates. Revenues,
expenses and assets are recognised net of the amount of
sales tax except:
• Where the deferred income tax liability arises from the
initial recognition of goodwill or of an asset or liability in
a transaction that is not a business combination and, at
the time of the transaction, affects neither accounting
profit nor taxable profit or loss; and
• Where the sales tax incurred on a purchase of assets or
services is not recoverable from the taxation authority, in
which case the sales tax is recognised as part of the cost
of acquisition of the asset or as part of the expense item
as applicable; and
•
In respect of taxable temporary differences associated
with investments in subsidiaries and associate, where the
timing of the reversal of the temporary differences can
be controlled and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred income tax assets are recognised for all
deductible temporary differences, carry forward of
unused tax credits and unused tax losses, to the extent
that it is probable that taxable profit will be available
against which the deductible temporary differences, and
the carry forward of unused tax credits and unused tax
losses can be utilised except:
• Where the deferred tax asset relating to the deductible
temporary difference arises from the initial recognition
of an asset or liability in a transaction that is not a
business combination and, at the time of the transaction,
affects neither accounting profit nor taxable profit or
loss; and
• Receivables and payables are stated with the amount
of sales tax included.
1.16 Borrowing Costs
Borrowing costs are recognised in profit or loss in the
period in which they are incurred.
1.17 Share capital and share issue expenses
Proceeds from issuance of equity shares are recognised
as share capital in equity. Incremental costs directly
attributable to the issuance of ordinary shares are
deducted against share capital.
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For personal use only
Notes to the financial statements
Continued
1. Summary of significant accounting policies
(cont’d)
1.18 Leases
The Group as lessee
At inception of a contract, the Group assesses if the
contract contains or is a lease. If there is a lease present,
a right-of-use asset and a corresponding lease liability
is recognised by the Group where the Group is a lessee.
However, all contracts that are classified as short-term
leases (i.e. a lease with a remaining lease term of 12 months
or less) and leases of low-value assets are recognised
as an operating expense on a straight-line basis over
the term of the lease.
Initially, the lease liability is measured at the present value of
the lease payments still to be paid at commencement date.
The lease payments are discounted at the interest rate
implicit in the lease. If this rate cannot be readily determined,
the Group uses the incremental borrowing rate.
Lease payments included in the measurement of the lease
liability are as follows:
• fixed lease payments less any lease incentives;
• variable lease payments that depend on an index or
rate, initially measured using the index or rate at the
commencement date;
• the amount expected to be payable by the lessee
under residual value guarantees;
• the exercise price of purchase options, if the lessee
is reasonably certain to exercise the options;
•
lease payments under extension options, if lessee
is reasonably certain to exercise the options; and
• payments of penalties for terminating the lease,
if the lease term reflects the exercise of an option
to terminate the lease.
The right-of-use assets comprise the initial measurement
of the corresponding lease liability as mentioned above,
any lease payments made at or before the commencement
date, as well as any initial direct costs. The subsequent
measurement of the right-of-use assets is at cost less
accumulated depreciation and impairment losses.
Right-of-use assets are depreciated over the lease term or
useful life of the underlying asset, whichever is the shortest.
Where a lease transfers ownership of the underlying asset,
or the cost of the right-of-use asset reflects that the Group
anticipates to exercise a purchase option, the specific asset
is depreciated over the useful life of the underlying asset.
1.19 New and Amended Accounting Policies Adopted
by the Group
Initial application of AASB 16
The Group has adopted AASB 16: Leases retrospectively
with the cumulative effect of initially applying AASB 16
recognised at 1 January 2019. In accordance with AASB 16,
the comparatives for the 2018 reporting period have not
been restated.
The Group has recognised a lease liability and right-of-use
asset for all leases (with the exception of short-term and
low-value leases) recognised as operating leases under
AASB 117: Leases where the Group is the lessee. There has
been no significant change from prior year treatment for
leases where the Group is a lessor.
The lease liabilities are measured at the present value
of the remaining lease payments. The Group adopted a
discount rate of 2.0% p.a. to discount the lease payments.
The right-of-use assets for the Group’s leases were
measured and recognised in the statement of financial
position as at 1 January 2019. There is no impact to the
Group’s financial position as at 1 January 2019 as the lease
liability was only contracted at the end of the financial
year 2019.
The following practical expedients have been used by
the Group in applying AASB 16 for the first time:
• for a portfolio of leases that have reasonably similar
characteristics, a single discount rate has been applied;
•
leases that have a remaining lease term of less than
12 months as at 1 January 2019 have been accounted
for in the same way as short-term leases;
• the use of hindsight to determine lease terms on
contracts that have options to extend or terminate;
• applying AASB 16 to leases previously identified as leases
under AASB 117 and Interpretation 4: Determining whether
an arrangement contains a lease without reassessing
whether they are, or contain, a lease at the date of initial
application; and
• not applying AASB 16 to leases previously not identified as
containing a lease under AASB 117 and Interpretation 4.
46
For personal use only 2. Critical accounting judgements and estimates
The preparation of the Group’s consolidated financial
statements requires management to make judgements,
estimates and assumptions that affect the reported
amounts of revenues, expenses, assets and liabilities.
Actual results may differ from these estimates. Estimates
and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised and in any
future periods affected.
2.1 Judgements made in applying accounting policies
In the process of applying the Group’s accounting policies,
management has made the following judgements which
have the most significant effect on the amounts recognised
in the consolidated financial statements:
(a) Recognition of Services revenue
The amounts of revenue recognised in the reporting
period depends on the extent to which the performance
obligations have been satisfied. Recognising Services
revenue requires significant judgement in determining
milestones, actual work performed and the estimated
costs to complete the work.
(b) Share-based payment transactions
The Company measures the cost of equity-settled
transactions by reference to the fair value of the equity
instruments at the date at which they are granted.
The fair value is determined by an internal valuation
using a Black-Scholes option pricing model.
(c) Capitalisation of computer software
Distinguishing the phases of a new customised software
project and determining whether the recognition
requirements for the capitalisation of development
costs are met requires judgement. Post-capitalisation,
management monitors whether the recognition
requirements continue to be met and whether there
are any indicators that capitalised costs may be impaired.
2.2 Key sources of estimation uncertainty
The key assumptions concerning the future and other
key sources of estimation uncertainty at the end of each
reporting period, that have a significant risk of causing a
material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
The Group based its assumptions and estimates on
parameters available when the financial statements were
prepared. Existing circumstances and assumptions about
future developments, however, may change due to market
changes or circumstances arising beyond the control
of the Group. Such changes are reflected in assumptions
when they occur.
(a) Impairment of non-financial assets
Impairment exists when the carrying value of an asset
or cash generating unit exceeds its recoverable amount,
which is the higher of its fair value less costs to sell and its
value in use. The fair value less costs to sell calculation is
based on available data from binding sales transactions in
an arm’s length transaction of similar assets or observable
market prices less incremental costs for disposing the
asset. The value in use calculation is based on a discounted
cash flow model.
(b) Impairment of receivables
The Group assesses at the end of each reporting period
whether there is any objective evidence that a financial
asset is impaired. Factors such as the probability of
insolvency or significant financial difficulties of the debtor
and default or significant delay in payments are objective
evidence of impairment. In determining whether there is
objective evidence of impairment, the Group considers
whether there is observable data indicating that there have
been significant changes in the debtor’s payment ability or
whether there have been significant changes with adverse
effect in the technological, market, economic or legal
environment in which the debtor operates in.
Where there is objective evidence of impairment, the
amount and timing of future cash flows are estimated
based on historical loss experience for assets with similar
credit risk characteristics.
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For personal use only
Notes to the financial statements
Continued
3. Revenue
Revenue from contracts with customers
Platform SaaS fees
Marketplace sales
Services sales
GROUP
2019
$
2018
$
722,525
247,779
632,309
1,602,613
379,259
158,735
1,227,101
1,765,095
3.1 The Group has disaggregated revenue into various categories in the following table. The revenue is disaggregated
by geographical market, product/service lines and timing of revenue recognition.
YEAR TO 31 DECEMBER 2019
Platform SaaS
Services
Marketplace
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
2019
$
Total
2018
$
499,726
320,361
375,475
696,300
207,234
93,649 1,082,435
1,110,310
211,579
58,089
256,834
530,801
40,545
65,086
508,958
653,976
11,220
809
–
–
–
–
11,220
809
722,525
379,259
632,309
1,227,101
247,779
158,735 1,602,613
1,765,095
–
–
–
–
247,779
158,735
247,779
158,735
722,525
379,259
632,309
1,227,101
–
– 1,354,834 1,606,360
722,525
379,259
632,309
1,227,101
247,779
158,735 1,602,613
1,765,095
GROUP
2019
$
13,632
5,006
18,638
2018
$
–
65,560
65,560
Geographical markets
Australia
Malaysia
Singapore
Timing of revenue
recognition
Products and services
transferred to customers:
At a point in time
Over time
4. Other income
Government grant
Others
48
For personal use only 5. Loss for the year
Loss before income tax from continuing operations includes the following specific expenses:
Employee benefits expense
– severance costs
Depreciation
– depreciation on furniture, fittings and equipment
– depreciation on right-of-use asset
Professional services
– contractors
General and administrative costs
– write-off / loss on disposal of furniture, fittings and equipment
– surrender of lease costs
– foreign currency translation gains / (losses)
– impairment of trade receivables
– travelling costs
Pre-IPO and IPO-related costs
– share-based payments
GROUP
2019
$
2018
$
183,019
78,017
31,095
31,764
23,962
–
104,437
108,338
61,017
67,518
13,538
15,354
101,131
14,775
–
26,857
180,826
150,300
2,452,376
–
6. Income tax
6.1 Income tax benefit
There is no income tax expense for the current financial year as the Group does not have chargeable income. The Group
recorded an income tax benefit of $156,263 for the comparative FY2018 arising from approved research and development
tax incentives.
At the end of the reporting period, the Group has tax losses of approximately $15,014,000 (2018: $9,302,000) that are
available for offset against future taxable profits of the companies in which the losses arose, for which no deferred tax
asset is recognised due to uncertainty of their recoverability. The use of these tax losses is subject to the agreement of
the tax authorities and compliance with certain provisions of the tax legislation of the respective countries in which the
companies operate.
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For personal use only
Notes to the financial statements
Continued
6. Income tax (cont’d)
6.2 The prima facie tax on losses from ordinary activities before income tax is reconciled to the income tax as follows:
Loss before tax from continuing operations
GROUP
2019
$
2018
$
(7,719,951)
(4,547,890)
Prima facie tax benefit on loss from ordinary activities before tax at the domestic tax
rates where the Group operates
(2,041,189)
(1,192,640)
Add/(subtract):
Tax effect of:
– non-allowable items
– effect of tax losses not recognised
– tax benefit of deductible equity raising costs
– under-provision for income tax in prior year
– movement in unrecognised temporary difference
Income tax attributable to entity
842,192
1,325,226
(117,456)
30,689
(39,462)
–
52,402
1,189,842
–
–
(49,604)
–
The above reconciliation is prepared by aggregating separate reconciliations for each tax jurisdiction where the Group
operates. A summary of the domestic tax rates by country where the Group operates is as follows:
Australia
Singapore
Malaysia
2019
%
27.5
17.0
24.0
2018
%
27.5
17.0
24.0
7. Key Management Personnel
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 key management personnel (KMP) for the year ended 31 December 2019.
The totals of remuneration paid to KMP of the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Share-based payments
Total KMP compensation
50
2019
$
894,608
85,589
349,827
1,330,024
2018
$
667,585
57,117
–
724,702
For personal use only 7. Key Management Personnel (cont’d)
Short-term employee benefits
These amounts include fees paid to the non-executive Chairman and non-executive directors as well as all salary,
paid leave benefits and any cash bonuses awarded to an executive director and other KMP.
Post-employment benefits
These amounts are the current-year’s estimated costs of providing for the Group’s superannuation contributions made
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, rights and shares granted on grant date.
Further information in relation to KMP remuneration can be found in the directors’ report.
8. Auditors’ remuneration
Remuneration of the auditor for:
– auditing or reviewing the financial statements
– preparation of investigating accountants report
GROUP
2019
$
37,940
20,000
57,940
2018
$
22,664
–
22,664
9. Earnings/(losses) per share
Basic earnings/(losses) per share is calculated by dividing the profit/(loss) for the year attributable to owners of the
Company by the weighted average number of ordinary shares outstanding during the financial year.
The following table reflects the loss and share data used in the computation of basic earnings/(losses) per share for
the years ended 31 December:
Loss for the year attributable to owners of the Company ($)
GROUP
2019
2018
(7,719,951)
(4,391,627)
Weighted average number of ordinary shares for basic earnings per share computation
139,666,641
31,749,315
The effects from the potential ordinary shares of the Company arising from the conversion of share-based payments
are deemed anti-dilutive. Accordingly, the basic and diluted earnings per share for the financial years 2019 and 2018
are the same.
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For personal use only
Notes to the financial statements
Continued
10. Trade and other receivables
CURRENT
Trade receivables
Provision for impairment
Other receivables
Provision for impairment
Total current trade and other receivables
Note
10a(i)
GROUP
2019
$
651,287
(187,094)
464,193
87,387
–
87,387
551,580
2018
$
700,234
(183,908)
516,326
50,372
–
50,372
566,698
All amounts are short-term. The net carrying value of trade receivables is considered a reasonable approximation of fair value.
The following table shows the movement in lifetime expected credit loss that has been recognised for trade and other
receivables in accordance with the simplified approach set out in AASB 9: Financial Instruments.
GROUP
Net
measurement
of loss
allowance
$
Opening
balance
1 January
2018
$
a. Lifetime Expected Credit Loss: Credit Impaired
(i) Current trade receivables
3,082
180,826
Amounts
written off
Closing
balance
31 December
2018
$
183,908
$
–
GROUP
Net
measurement
of loss
allowance
Amounts
written off
Closing
balance
$
$
31 December
2019
$
Opening
balance
1 January
2019
$
a. Lifetime Expected Credit Loss: Credit Impaired
(i) Current trade receivables
183,908
15,354
(12,168)
187,094
The Group applies the simplified approach to providing for expected credit losses prescribed by AASB 9, which
permits the use of the lifetime expected loss provision for all trade receivables. To measure the expected credit losses,
trade receivables have been grouped based on shared credit risk characteristics and the days past due. The loss
allowance provision as at 31 December 2019 is determined as follows; the expected credit losses also incorporate
forward-looking information.
The “amounts written off”, if any, are all due to customers declaring bankruptcy, or term receivables that have now
become unrecoverable.
52
For personal use only 10. Trade and other receivables (cont’d)
2019
Expected loss rate
Gross carrying amount
Loss allowing provision
2018
Expected loss rate
Gross carrying amount
Loss allowing provision
CURRENT
>30 DAYS
PAST DUE
>60 DAYS
PAST DUE
>90 DAYS
PAST DUE
$
0%
$
0%
$
0%
421,584
26,629
66,903
–
–
–
$
83.7%
223,558
187,094
CURRENT
>30 DAYS
PAST DUE
>60 DAYS
PAST DUE
>90 DAYS
PAST DUE
$
0%
380,941
–
$
0%
26,193
–
$
0%
548
–
$
53.6%
342,924
183,908
TOTAL
$
25.3%
738,674
187,094
TOTAL
$
24.5%
750,606
183,908
Credit risk
The Group has no significant concentration of credit risk with respect to any single counterparty or group of
counterparties other than those receivables specifically provided for and mentioned within this note. In FY2017, there
was a significant contract signed with a private education institution in Malaysia that subsequently encountered financial
difficulty. The Group made an impairment of $178,481 for this receivable in FY2018 representing 50% of the total receivable
from this debtor. This debtor has since settled the balance of the 50% owing that has not been impaired. The Group
has determined that the amount impaired is uncollectible and has written off this amount as at the date of this report.
The class of assets described as “trade and other receivables” is considered to be the main source of credit risk related
to the Group.
The Group writes off a trade receivable when there is information indicating that the debtor is in severe financial difficulty
and there is no realistic prospect of recovery; for example, when the debtor has been placed under liquidation or has
entered into bankruptcy proceedings, or when the trade receivables are over two years past due, whichever occurs earlier.
Collateral Pledged
A charge over trade receivables transacted through the Paypal platform has been provided for a borrowing. Refer to
Note 18 for further details.
11. Cash and cash equivalents
Cash at bank and on hand
Cash with online payment providers
Short-terms deposits placed with banks
GROUP
2019
$
1,641,000
1,618
6,098,150
7,740,768
2018
$
828,173
1,105
247,454
1,076,732
Included in short-term deposits of the Group as at 31 December 2019 is an amount of $98,150 (2018: $142,952) that is
pledged to a bank as collateral for the issuance of a bank guarantee in respect of an office tenancy. The restriction on
these bank deposits were removed prior to the date of this report.
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Notes to the financial statements
Continued
12. Furniture, fittings and equipment
2019
Cost
At 1 January 2019
Additions
Disposals
Exchange difference
At 31 December 2019
Accumulated depreciation
At 1 January 2019
Depreciation for the year
Disposals
Exchange difference
At 31 December 2019
Net carrying amount
2018
Cost
At 1 January 2018
Additions
Disposals
Reclassified to Intangible assets
Written off
Exchange difference
At 31 December 2018
Accumulated depreciation
At 1 January 2018
Depreciation for the year
Disposals
Written off
Exchange difference
At 31 December 2018
Net carrying amount
54
GROUP
Computer
$
Office
equipment
$
Leasehold
Improvement
$
Total
$
54,649
6,207
57,865
5,490
42,402
33,892
154,916
45,589
(38,600)
(44,027)
(45,941)
(128,568)
728
22,984
10,864
9,330
754
20,082
22,031
12,227
646
30,999
14,361
9,538
2,128
74,065
47,256
31,095
(14,184)
(30,092)
(23,274)
(67,550)
192
6,202
16,782
403
4,569
15,513
277
902
30,097
872
11,673
62,392
GROUP
Computer
$
Office
equipment
$
Leasehold
Improvement
$
Total
$
21.898
47,584
(16,657)
–
–
1,824
54,649
10,058
9,237
(9,510)
–
1,079
10,864
43,785
101,238
21,537
–
(28,556)
(39,147)
2,793
57,865
50,654
9,308
–
(39,147)
1,216
22,031
35,834
44,455
5,080
(9,362)
–
(640)
2,869
42,402
10,395
5,417
(1,734)
(640)
923
14,361
28,041
167,591
74,201
(26,019)
(28,556)
(39,787)
7,486
154,916
71,107
23,962
(11,244)
(39,787)
3,218
47,256
107,660
For personal use only 13. Intangible assets
2019
Cost
At 1 January 2019
Additions
Exchange difference
At 31 December 2019
Net carrying amount
2018
Cost
At 1 January 2018
Additions
Reclassified from Furniture, fittings and equipment
At 31 December 2018
Net carrying amount
Domain names
and trademarks
$
GROUP
Computer
software work-
in-progress
$
Goodwill
$
37,096
24,500
–
–
37,096
37,096
–
–
24,500
24,500
239,816
147,776
4,153
391,745
391,745
Domain names
and trademarks
$
GROUP
Computer
software work-
in-progress
$
Goodwill
$
8,350
190
28,556
37,096
37,096
24,500
–
–
24,500
24,500
–
239,816
–
239,816
239,816
Total
$
301,412
147,776
4,153
453,341
453,341
Total
$
32,850
240,006
28,556
301,412
301,412
Domain names and trademarks are recognised at cost of acquisition. Goodwill represents premium paid for business
assets. These are considered to have an infinite life and are carried at cost less any impairment losses.
Computer software is recorded at cost. It has a finite life and is carried at cost less accumulated amortisation and any
impairment losses. Software has an estimated useful life of ten years. Amortisation commences when the software is ready
for commercial use.
Domain names and trademarks and Goodwill are allocated to the cash-generating unit which is based on the Group’s
reporting geographical segment in Australia.
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Notes to the financial statements
Continued
14. Right-of-use asset
The Group’s lease comprises a lease of office premises. This lease has a lease term of 3 years.
i) AASB 16 related amounts recognised in the balance sheet
Right of use assets
Leased office premises
Accumulated depreciation
Total right-of-use asset
Movement in carrying amounts:
Leased office premises:
At 1 January 2019
Additions
Depreciation expense
Net carrying amount
ii) AASB 16 related amounts recognised in the statement of profit or loss
Depreciation charge related to right-of-use assets
Interest expense on lease liabilities
Short-term leases expense
Low-value asset leases expense
Total cash outflows for leases
2019
$
381,169
(31,764)
349,405
–
381,169
(31,764)
349,405
2019
$
31,764
1,906
277,288
27,572
304,860
56
For personal use only 15. Trade and other payables
CURRENT
Trade payables
Other payables and accrued expenses
NON-CURRENT
Other payables
a. Financial liabilities at amortised cost classified as trade and other payables
Trade and other payables:
– total current
– total non-current
Financial liabilities as trade and other payables
GROUP
2019
$
452,514
341,068
793,582
199,927
993,509
2018
$
179,448
129,424
308,872
–
308,872
793,582
199,927
993,509
308,872
–
308,872
Included in other payables for 2019 is an amount of $389,516 of which $199,927 is disclosed as non-current (2018: Nil) owing
to the Australian Tax Office being an instalment plan payable over 23 monthly instalments arising from PAYG withheld for
which interest is charged at average rate of 7.98% p.a. Trade and other payables are otherwise non-interest bearing.
16. Provisions
Current:
Provision for annual leave
GROUP
2019
$
2018
$
143,650
193,468
17. Convertible preference shares
A subsidiary of the Company, OpenLearning Global Pte Ltd, issued a total of 5,580,982 convertible preference shares
(“CPS”) in the comparative FY2018 at an aggregate issue price of $9.00 as part of a funds raising exercise completed in
FY2018. These CPS were converted to equity shares in the subsidiary in FY2019 as part of a corporate restructuring in
preparation for the Company’s listing on the ASX.
18. Borrowing
The borrowing balance represents a working capital loan provided by Paypal which is secured over the funds transacted
through the Paypal payment gateway. This borrowing attracts an upfront loan fee of 18.5% with the borrowing repaid
from 30% deduction of the receivables collected through the payment gateway until the borrowing is fully settled.
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Notes to the financial statements
Continued
19. Share capital
Issued and fully paid ordinary shares:
At 1 January
Issuance of shares during the period :
– pursuant to OLGAI Share Exchange Agreement
– pursuant to OLGSG Share Exchange Agreement
– pursuant to conversion of convertible notes
– issuance to advisors and a director
– pursuant to initial public offering of shares
Fair value adjustment on shares issued
GROUP
2019
2018
No. of shares
$
No. of shares
$
25,000,000
5,189,487
25,000,000
5,189,487
16,527,200
96,863
23,472,801
8,550,009
30,833,307
3,700,000
3,833,333
766,667
40,000,000
8,000,000
–
(825,871)
–
–
–
–
–
–
–
–
–
–
At 31 December
139,666,641
25,477,155
25,000,000
5,189,487
Issued and fully paid “A” shares:
At 1 January
Issuance of shares during the period
Shares issued on conversion of convertible
preference shares
Transfer pursuant to OLGSG Share Exchange
Agreement
7,500,000
7,500,000
3,000,000
3,000,000
–
4,895,597
–
3
(12,395,597)
(7,500,003)
4,500,000
4,500,000
–
–
–
–
At 31 December
–
–
7,500,000
7,500,000
Issued and fully paid “B” shares:
At 1 January
Issuance of shares during the period
Shares issued on conversion of convertible
preference shares
Transfer pursuant to OLGSG Share Exchange
Agreement
At 31 December
Equity issuance costs
1,050,000
1,050,000
–
–
–
685,384
–
6
(1,735,384)
(1,050,006)
1,050,000
1,050,000
–
–
–
–
–
–
–
1,050,000
1,050,000
(2,243,961)
–
(802,249)
Total ordinary, “A” and “B” shares at 31 December
139,666,641
23,233,194
33,550,000
12,937,238
Corporate reorganisation
The Group undertook the transactions described below in FY2019 as part of a corporate reorganisation to facilitate the
listing of the Company on the ASX.
The Company acquired the entire issued and paid-up share capital of OLG Australia Investors Pte Ltd (“OLGAI”) from all
its shareholders (“OLGAI Shareholders”) via the entry and execution of a share exchange agreement made between the
OLGAI Shareholders and the Company (“OLGAI Share Exchange Agreement”).
58
For personal use only 19. Share capital (cont’d)
OLGAI together with a group of minority shareholders (“OLGSG Minority Shareholders”) owns the entire issued and
paid-up share capital of OpenLearning Global Pte Ltd (“OLGSG”). OLGSG in turn owns the entire issued and paid-up share
capital in Open Learning Global Pty Ltd (“OLGAU”) and OpenLearning Global (M) Sdn Bhd (“OLGMY”). OLGAU and
OLGMY are the operating subsidiaries of the Group providing a cloud-based social learning platform, learning design
services and sale of education courses through a global marketplace.
The Company, together with the execution of the OLGAI Share Exchange Agreement, also acquired the entire issued and
paid-up share capital of OLGSG via the entry and execution of a share exchange agreement made between the OLGSG
Minority Shareholders and the Company (“OLGSG Share Exchange Agreement”).
Pursuant to the OLGAI Share Exchange Agreement and the OLGSG Share Exchange Agreement (collectively, the “Group
Share Exchange Agreements”), both the OLGAI Shareholders and the OLGSG Minority Shareholders sold and transferred
all their respective shares in OLGAI and OLGSG to the Company in exchange for the Company allotting to each of the
OLGAI Shareholders and OLGSG Minority Shareholders new shares in the Company representing all the issued and
paid-up shares of the Company.
Following the completion of the Group Share Exchange Agreements, the Company further issued shares (i) pursuant to
conversion of convertible notes, (ii) to advisors and a director for services rendered and (iii) for the initial public offering
of shares on the ASX.
20. Reserves
Foreign currency translation reserve
Common control reserve
Share option reserve
GROUP
2019
$
11,719
1,650,477
1,791,414
3,453,610
2018
$
15,841
–
–
15,841
(i) Foreign currency translation reserve
Foreign currency translation reserve represents exchange differences arising from the translation of the financial
statements of the Company and its subsidiaries whose functional currencies are different from that of the Group’s
presentation currency.
(ii) Common control reserve
Common control reserve records difference between the fair value of net assets acquired and consideration paid.
(iii) Share option reserve
Share option reserve records items recognised as expenses on valuation of share options.
21. Financial risk management
The Group’s principal financial instruments comprise of receivables, payables, cash at bank and short-term deposits.
The Board of Directors has overall responsibility for the oversight and management of the Group’s exposure to a variety
of financial risks (including credit risk, foreign currency risk, liquidity risk and interest rate risk).
The overall risk management strategy seeks to assist the Group in meeting its financial targets, while minimising potential
adverse effects on the financial performance including the review of future cash flow requirements.
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Notes to the financial statements
Continued
21. Financial risk management (cont’d)
(a) Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting financial obligations due to shortage of funds.
The Group’s exposure to liquidity risk arises primarily from cash outflows from current operating losses. The Group’s
objective is to focus on maintaining an appropriate level of overheads in line with the Group’s business plan and available
cash resources, with the objective of achieving a cashflow positive business within the budgeted timeline.
The table below summarise the maturity profile of the Group’s financial assets and liabilities at the end of the reporting
period based on contractual undiscounted repayment obligations.
WITHIN 1 YEAR
1 TO 5 YEARS
OVER 5 YEARS
TOTAL
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
2019
$
2018
$
Group
Financial assets –
cash flows realisable
Trade and other
receivables
Cash and short-term
deposits
551,580
566,698
7,740,768
1,076,732
–
–
–
Total anticipated inflows
8,292,348 1,643,430
Financial liabilities due
for payment
Trade and other payables
793,582
308,872
199,927
Lease liability
Borrowing
132,191
17,727
–
–
250,884
–
Total expected outflows
943,500
308,872
450,811
Net inflow/(outflow) on
financial instruments
7,348,848 1,334,558
(450,811)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
551,580
566,698
– 7,740,768
1,076,732
– 8,292,348 1,643,430
–
–
–
993,509
308,872
383,075
17,727
–
–
– 1,394,311
308,872
– 6,898,037 1,334,558
(b) Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its
obligations. The Group’s exposure to credit risk arises primarily from trade and other receivables. For other financial assets
(including cash and short-term deposits), the Group minimise credit risk by dealing with high credit rating counterparties.
The Group’s objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk
exposure. The Group trades with third parties that are considered creditworthy. In addition, receivable balances are
monitored on an ongoing basis.
Exposure to credit risk
At the end of the reporting period, the Group’s maximum exposure to credit risk is represented by the carrying amount
of each class of financial assets recognised on the balance sheets.
Credit risk concentration profile
Except as disclosed in Note 10 above, the Group does not have any significant exposure to any individual customer
or counterparty nor does it have any major concentration of credit risk related to any financial instruments.
Financial assets that are neither past due nor impaired
Trade and other receivables that are neither past due nor impaired are with creditworthy debtors with good payment
records with the Group. Cash and short-term deposits and investment securities that are neither past due nor impaired
are placed with or entered into with reputable financial institutions.
Financial assets that are either past due or impaired
Information regarding financial assets that are either past due or impaired is disclosed in Note 10.
60
For personal use only 21. Financial risk management (cont’d)
(c) Foreign currency risk
Exposure to foreign currency risk may result in the fair value or future cash flows of a financial instrument fluctuating
due to movement in foreign exchange rates of currencies in which the Group holds financial instruments which are other
than the AUD functional currency of the Group.
With instruments being held by overseas operations, fluctuations in the SGD Singapore dollar and USD United States
dollar may impact on the Group’s financial results.
The following table shows the foreign currency risk on the financial assets and liabilities of the Group’s operations
denominated in currencies other than the functional currency of the operations.
2019
Group
Functional currency of entity:
Australian dollar
Statement of financial position exposure
2018
Group
Functional currency of entity:
Australian dollar
Statement of financial position exposure
NET FINANCIAL ASSETS/(LIABILITIES) IN AUD
USD
SGD
Other
Total AUD
19,873
19,873
15,040
15,040
–
–
34,913
34,913
NET FINANCIAL ASSETS/(LIABILITIES) IN AUD
USD
SGD
Other
Total AUD
(2,774)
(2,774)
2,989
2,989
–
–
215
215
Foreign currency risk concentration profile
The Group does not have any significant exposure to any specific foreign currency grouping nor does it have any major
concentration of foreign currency risk related to any financial instruments.
(d) Interest rate risk
The Group’s exposure to market interest rates relate to cash deposits held at variable rates. The management monitors
its interest rate exposure and consideration is given to potential renewals of existing positions.
Sensitivity analysis for interest rate risk
The following table demonstrate the sensitivity of profit/(loss) and equity to a reasonably possible change in interest rates
of +/ – 50 basis points, will all other variables held constant.
Year ended 31 December 2019
+0.5% in interest rates
-0.5% in interest rates
Year ended 31 December 2018
+0.5% in interest rates
-0.5% in interest rates
GROUP
Profit
$
Equity
$
38,704
38,704
(38,704)
(38,704)
5,384
(5,384)
5,384
(5,384)
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Notes to the financial statements
Continued
22. Interests in subsidiaries
NAME
PRINCIPAL ACTIVITIES
COUNTRY OF
INCORPORATION
PROPORTION (%)
OF OWNERSHIP INTEREST
Held by the Company
OLG Australia Investors Pte Ltd
Investment holding
OpenLearning Global Pte Ltd
Investment holding and
provision of online education
platform and services
Held by OpenLearning
Global Pte Ltd
Open Learning Global Pty Ltd
Provision of online education
platform and services.
OpenLearning Global (M)
Sdn Bhd
Provision of online education
platform and services.
Singapore
Singapore
Australia
Malaysia
* 63.89% held via OLG Australia Investors Pte Ltd.
** 74.52% held via OLG Australia Investors Pte Ltd.
2019
%
100
100*
100
100
2018
%
100
100**
100
100
23. Operating segments
The Group has identified its operating segments based on the internal reports that are reviewed and used by
management in assessing performance and determining the allocation of resources.
The Group’s sales, marketing and professional services operations are managed on the basis of geographical location.
The Group’s shared services, which includes software engineering, product management and finance, are primarily
located in Australia and expenses are primarily booked within the Australian entity, with the addition of a separate
corporate overheads segment. Operating segments are therefore determined on the same basis and the Group has
four reportable segments as follows:
(a) Australia
(b) Malaysia
(c) Singapore
(d) Corporate (based in Australia)
62
For personal use only 23. Operating segments (cont’d)
AUSTRALIA
MALAYSIA
SINGAPORE
CORPORATE
(AUSTRALIA)
2019
Revenue:
External sales
Segment results:
$
$
$
1,082,435
508,958
11,220
Web-hosting and other direct costs
(200,007)
(194,424)
(383)
$
–
–
TOTAL
$
1,602,613
(394,814)
Employees benefit expenses
(3,272,534)
(1,133,985)
(114,673)
(81,081)
(4,602,273)
Depreciation
Promotional and advertising
Professional services
General and administration
Pre-IPO and IPO-related costs
Segment loss
Segment assets
Segment liabilities
(39,828)
(93,721)
(152,272)
(22,734)
(9,593)
(13,184)
(587,426)
(207,977)
(297)
(1,366)
(57,327)
(15,604)
–
(62,859)
(16,434)
(121,114)
(19,880)
(242,663)
(11,849)
(822,856)
–
–
(245,548)
(2,825,162)
(3,070,710)
(3,277,271)
(1,068,187)
(422,964)
(2,951,529)
(7,719,951)
1,247,588
1,559,841
881,067
470,000
129,894
7,125,513
9,384,062
94,650
(13,793)
2,110,698
AUSTRALIA
MALAYSIA
SINGAPORE
CORPORATE
(AUSTRALIA)
$
$
$
2018
Revenue:
External sales
Segment results:
1,110,310
653,976
Web-hosting and other direct costs
(392,830)
(102,817)
809
–
Employees benefit expenses
(3,017,260)
(1,182,466)
(61,253)
Depreciation
Promotional and advertising
Professional services
(3,785)
(170,144)
(209,169)
(20,036)
(60,199)
(35,902)
General and administration
(604,579)
(401,359)
(141)
(6,401)
(93,029)
(35,452)
Segment loss
Segment assets
Segment liabilities
(3,265,068)
(1,095,237)
(187,585)
1,068,921
756,368
851,352
143,710
262,937
23,542
$
–
–
–
–
–
–
–
–
–
–
TOTAL
$
1,765,095
(495,647)
(4,260,979)
(23,962)
(236,744)
(338,100)
(1,041,390)
(4,547,890)
2,183,210
923,620
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Notes to the financial statements
Continued
24. Cash flow information
Reconciliation of cash flows from operating activities with loss after income tax:
Loss after tax
Non-cash flows in loss for the year:
Depreciation
Write-off / Loss on disposal of furniture, fittings and equipment
Unrealised exchange (gain) / loss
Pre-IPO and IPO Costs
Changes in assets and liabilities:
Increase in trade and other receivables
Increase in trade and other payables
Net cash flows used in operating activities
GROUP
2019
$
2018
$
(7,719,951)
(4,391,627)
62,859
61,017
(10,113)
3,070,710
23,962
14,775
7,705
–
(80,750)
742,106
(209,493)
10,130
(3,874,122)
(4,544,548)
25. Lease commitments
Non-cancellable operating leases contracted for but not recognised in the financial statements:
Payable – minimum lease payments:
Not later than one year
Later than one year and not later than five years
GROUP
2019
$
2018
$
–
–
–
270,729
809,450
1,080,179
The leases for the comparative FY2018 are in respect of commercial lease for the Group’s office premises that have been
terminated in FY2019.
26. Events after the reporting period
The Company is currently reviewing and closely monitoring the Novel Coronavirus 2019 (COVID-19) situation as it
unfolds, ensuring compliance and cooperation with protocols and advice as and when issued by the Government.
The Directors are reviewing business operations and strategies and assessing the impact on the Group. The Group is
unable to determine at this time the potential impact COVID-19 will have, noting that a number of education providers
have expressed an intention to expand their on-line education offerings and the Group is actively working to support
their urgent needs.
64
For personal use only Directors’ declaration
In accordance with a resolution of the directors of OpenLearning Limited, the directors of the Company declare that:
1.
the financial statements and notes, as set out, are in accordance with the Corporations Act 2001 and:
a. comply with Australian Accounting Standards, which, as stated in accounting policy Note 1 to the financial
statements, constitutes compliance with International Financial Reporting Standards; and
b. give a true and fair view of the financial position as at 31 December 2019 and of the performance for the year
ended on that date of the consolidated group;
2.
3.
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; and
the directors have been given the declarations required by section 295A of the Corporations Act 2001 from the
Chief Executive Officer and Chief Financial Officer.
On behalf of the Board of Directors
Adam Brimo
Managing Director
Dated: 27 March 2020
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Creating
the leaders
of tomorrow,
today.
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Independent auditor’s report
OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
Report on the Financial Report
Opinion
We have audited the financial report of OpenLearning Limited (the company) and its controlled
entities (the group), which comprises the consolidated statement of financial position as at 31
December 2019, the consolidated statement of profit or loss and other comprehensive income,
the consolidated statement of changes in equity and the consolidated statement of cash flows
for the year then ended, and notes to the consolidated financial statements, including a
summary of significant accounting policies and the directors’ declaration.
In our opinion the accompanying financial report of the group is in accordance with the
Corporations Act 2001, including:
a. giving a true and fair view of the group’s financial position as at 31 December 2019 and
of its financial performance for the year then ended; and
b.
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Those Standards
require that we comply with relevant ethical requirements relating to audit engagements and
plan and perform the audit to obtain reasonable assurance about whether the financial report
is free from material misstatement. Our responsibilities under those Standards are further
described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our
report. We are independent of the group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110: Code of Ethics for Professional
Accountants (the Code) that are relevant to our audit of the financial report in Australia. We
have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001, which
has been given to the directors of the company, would be in the same terms if given to the
directors as at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion.
Material Uncertainty Related to Going Concern
We draw attention to Note 1 in the financial report, which indicates that the group incurred a
net loss after tax of $7,719,951 and operating cash outflows of $3,874,122 for the year ended
31 December 2019. As stated in Note 1, these events or conditions, along with other matters
as set forth in Note 1, indicate that a material uncertainty exists that may cast significant doubt
on the group’s ability to continue as a going concern. Our opinion is not modified in respect of
this matter.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial report for the year ended 31 December 2019. These
matters were addressed in the context of our audit of the financial report as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
68
For personal use only
OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
Key Audit Matter
How Our Audit Addressed
the Key Audit Matter
Accounting for Corporate Reorganisation
Refer to Note 19 Share capital
to
Pursuant
the group share exchange
agreement as disclosed in Note 19 to the
financial statements, OLG Australia Investors
Pte Ltd shareholders and Openlearning
Global Pte Ltd minority shareholders sold and
transferred all their respective shares in OLG
Australia Investors Pte Ltd and Openlearning
Global Pte Ltd to the company in exchange
for the company allotting new shares to these
shareholders.
The accounting for the corporate restructure
of the group was considered a key audit
matter given its material effect on the group
and the complexity of the transaction which
occurred to give effect to the restructure.
Our procedures included, amongst others:
Obtaining an understanding of the
substance and
the
restructure transaction by reviewing
the underlying legal documents;
form of
legal
Assessed
evaluated
and
management’s accounting treatment
the
pertaining
restructure
accordance with
transaction
applicable accounting standards;
Reviewed the appropriateness of the
restructure journals recorded at the
restructure date; and
to
in
Assessed the adequacy of the related
disclosures in the financial report.
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OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
Share-based payment transactions
Refer to Note 2 Critical accounting judgements and estimates, Note 19 Share capital and
Note 20 Reserves
During the year ended 31 December 2019,
the group undertook various share-based
payment arrangements in relation to the
settlement of supplier and consultant
expenses through the issue of ordinary
shares, options and performance rights.
The accounting for share-based payments
was a key audit matter because the expense
incorporates an element of judgement in
relation to the determination of fair value,
particularly in relation to the options and
performance rights. The group valued the
options and performance rights, using an
option pricing model, where inputs such as
volatility, dividend yield and risk-free rate
require judgement.
Our procedures included, amongst others:
We obtained and confirmed a
reconciliation of shares and options on
issue during the year, and assessed
whether new shares, options and
rights issued trigger the requirement of
AASB 2: Share-based payment;
We
the
reviewed
share-based
payment amount recognised during
terms and
the year against
underlying
conditions
arrangement;
the
the
of
We reviewed the estimated fair value
of options and performance rights
using an option pricing model,
the
including
reasonableness of key inputs used in
the model;
assessing
Where applicable, we verified the fair
value of the services received to
supplier invoices; and
We assessed the adequacy of the
group’s disclosures in relation to the
share-based payment transactions.
Information Other than the Financial Report and Auditor’s Report Thereon
The directors are responsible for the other information. The other information comprises the
information included in the group’s annual report for the year ended 31 December 2019, but
does not include the financial report and our auditor’s report thereon.
Our opinion on the financial report does not cover the other information and accordingly we do
not express any form of assurance conclusion thereon.
In connection with our audit of the financial report, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent
with the financial report or our knowledge obtained in the audit or otherwise appears to be
materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement
of this other information, we are required to report that fact. We have nothing to report in this
regard.
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OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
Responsibilities of the Directors for the Financial Report
The directors of the company are responsible for the preparation of the financial report that
gives a true and fair view in accordance with Australian Accounting Standards and the
Corporations Act 2001 and for such internal control as the directors determine is necessary to
enable the preparation of the financial report that gives a true and fair view and is free from
material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the ability of the
group to continue as a going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the directors either intend to
liquidate the group or to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a
whole is free from material misstatement, whether due to fraud or error, and to issue an
auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance,
but is not a guarantee that an audit conducted in accordance with the Australian Auditing
Standards will always detect a material misstatement when it exists. Misstatements can arise
from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of
this financial report.
As part of an audit in accordance with the Australian Auditing Standards, we exercise
professional judgement and maintain professional scepticism throughout the audit. We also:
–
Identify and assess the risks of material misstatement of the financial report, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.
The risk of not detecting a material misstatement resulting from fraud is higher than for
one resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control
– Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the group’s internal control.
– Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
– Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the group’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial
report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are
based on the audit evidence obtained up to the date of our auditor’s report. However,
future events or conditions may cause the group to cease to continue as a going concern.
– Evaluate the overall presentation, structure and content of the financial report, including
the disclosures, and whether the financial report represents the underlying transactions
and events in a manner that achieves fair presentation.
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OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
– Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the group to express an opinion on the financial
report. We are responsible for the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where
applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of
most significance in the audit of the financial report of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we
determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest
benefits of such communication.
Report on the Remuneration Report
We have audited the Remuneration Report included in the directors’ report for the year ended
31 December 2019.
In our opinion, the Remuneration Report of OpenLearning Limited for the year ended 31
December 2019 complies with section 300A of the Corporations Act 2001.
Responsibilities
The directors of the company are responsible for the preparation and presentation of the
Remuneration Report in accordance with section 300A of the Corporations Act 2001. Our
responsibility is to express an opinion on the Remuneration Report, based on our audit
conducted in accordance with Australian Auditing Standards.
HALL CHADWICK
Level 40, 2 Park Street
Sydney NSW 2000
DREW TOWNSEND
Partner
Dated: 27 March 2020
72
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Shareholder information
The shareholder information set out below was applicable as at 23 March 2020.
A. Distribution of Equity Securities – Ordinary Shares
Analysis of numbers of equity security holders by size of holding:
SPREAD OF HOLDINGS
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
TOTAL
NUMBER
OF HOLDERS
NUMBER
OF UNITS
% OF TOTAL
ISSUED
CAPITAL
13
189
212
593
150
1,165
647,545
1,854,354
22,596,949
114,566,628
0.00%
0.46%
1.33%
16.18%
82.03%
1,157
139,666,641
100.00%
Based on the price per security, number of holders with an unmarketable holding: 53, with total 78,207, amounting to
0.06% of Issued Capital.
B. Distribution of Equity Securities – Share Options
Analysis of numbers of option holders by size of holding:
SPREAD OF HOLDINGS
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
TOTAL
C. Distribution of Equity Securities – Performance Rights
Analysis of numbers of Performance Rights holders by size of holding:
SPREAD OF HOLDINGS
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
TOTAL
NUMBER
OF HOLDERS
NUMBER
OF UNITS
% OF TOTAL
ISSUED
CAPITAL
–
–
–
25
49
74
–
–
–
–
–
–
1,718,374
36,908,266
38,626,640
4.45%
95.55%
100.00%
NUMBER
OF HOLDERS
NUMBER
OF UNITS
% OF TOTAL
ISSUED
CAPITAL
–
–
–
–
2
2
–
–
–
–
–
–
–
–
2,750,000
2,750,000
100.00%
100.00%
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Shareholder information
Continued
D. Equity Security Holders – Ordinary Shares
Twenty largest quoted equity security holders. The names of the twenty largest holders of quoted equity securities are
listed below:
NAME
MAGNA INTELLIGENT SDN BHD
PRESTARIANG CAPITAL SDN BHD
CLIVE MAYHEW
MR ADAM MAURICE BRIMO
RICHARD BUCKLAND
AUSTRALIAN CATHOLIC UNIVERSITY LIMITED
NATIONAL NOMINEES LIMITED
NARRON PTY LTD
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