ABN 18 635 890 390
OpenLearning Limited and Controlled
Entities
Audited Annual Financial Statements
31 December 2022
OpenLearning Limited and Controlled Entities
Corporate Directory
Directors
Spiro Pappas
Adam Brimo
John Merakovsky
Rupesh Singh
- Non-Executive Chairman
- Managing Director and Group CEO
- Non-Executive Director
- Non-Executive Director
Joint Company Secretaries
Nova Taylor
Robyn Slaughter
Registered Office
Suite 1803, 227 Elizabeth Street
Sydney NSW 2000
Auditors
Hall Chadwick
Level 40, 2 Park Street
Sydney NSW 2000
Share Registrar
Automic Pty Ltd
Level 5, 126 Phillip Street
Sydney NSW 2000
Stock Exchange Listing
Australian Securities Exchange
Code: OLL
OpenLearning Limited and Controlled Entities
General information
Index
Directors' report
Auditor’s independence declaration
Consolidated statement of profit or loss and other comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the financial statements
Directors’ declaration
Independent auditor’s report
Shareholder information
Page
1
20
21
22
23
25
26
61
62
67
OpenLearning Limited and Controlled Entities
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 2022.
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:
Spiro Pappas
Kevin Barry
Adam Brimo
John Merakovsky
Rupesh Singh
David Buckingham
Professor Beverley Oliver
Maya Hari
Benjamin Shields
- Non-Executive Director and Chairman (appointed as Chairman on
25 May 2022)
- Non-Executive Director (resigned on 30 June 2022) and Chairman
(resigned as Chairman on 25 May 2022)
- Managing Director and Group CEO
- Non-Executive Director (appointed on 30 June 2022)
- Non-Executive Director (appointed on 14 October 2022)
- Non-Executive Director (resigned on 27 May 2022)
- Non-Executive Director (resigned on 22 March 2022)
- Non-Executive Director (resigned on 26 April 2022)
- Non-Executive Director (resigned on 27 January 2023)
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;
• online program management serving direct-entry programs that enable students to enter
universities;
• 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 2022 (“FY2022”):
• gross sales of $3,628,025, a decrease of 12.9% year-on-year (“YoY”);
• revenue of $3,167,310, a decrease of 9.7% YoY;
• loss after tax of $(5,648,308), a decrease in losses of 16.0% YoY.
- 1 -
OpenLearning Limited and Controlled Entities
Directors’ report
2022
$
2021
$
Inc / (Dec)
%
Revenue from ordinary activities
3,167,310
3,507,542
(9.7)
Revenue comprises of the following:
Platform SaaS fees
Program delivery
Marketplace sales
Services sales
Gross sales
Less: Sharing of revenue with course
creators
Revenue
Strategy
1,644,233
1,035,951
552,217
395,624
3,628,025
(460,715)
3,167,310
1,433,206
1,611,386
726,822
393,516
4,164,930
(657,388)
3,507,542
14.7
(35.7)
(24.0)
0.5
(12.9)
(29.9)
(9.7)
OpenLearning offers a unique lifelong learning platform, encompassing short courses, micro-
credentials and qualifications. OpenLearning is building its client base by empowering education
providers to enter and operate the online lifelong learning market with a suite of products, including:
• Platform Subscription: Providing an innovative learning platform and tools on a
Software-as-a-service (SaaS) model to enable education providers to deliver courses
online.
• Program Delivery: Partnering with top institutions to deliver programs on the
OpenLearning platform with capabilities across full spectrum of program delivery.
• Value-added services: Providing a marketplace and learning design services to clients
to drive network effects and accelerate platform adoption.
The Group has positioned itself to capitalise on the shift towards online education that began before
COVID-19 and has since accelerated. OpenLearning ended FY2022 with 245 Platform Subscription
customers and over 3 million learners, making it one of Australia and Southeast Asia’s largest lifelong
learning platforms.
Financial highlights for FY2022
The Group is pleased to report that revenue from its core Platform Subscription division continued to
grow. In FY2022, SaaS annual recurring revenue (ARR)1 grew by 15.6% and SaaS revenue grew
by 14.7% while the number of SaaS customers expanded by 19.5% to 245 by the end of the year.
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.
- 2 -
OpenLearning Limited and Controlled Entities
Directors’ report
The Group’s Program Delivery division, which launched in FY2021 with the UNSW Transition
Program Online, was impacted by lower demand for Australian international education from its
partner’s target markets in FY2022, resulting in revenue declining by 35.7% YoY in the division.
SaaS ARR ($m)
SaaS Customers
$2.0
$1.5
1.345
1.715
1.484
245
205
167
$1.0
$0.5
$0.0
$2.0
$1.5
$1.0
$0.5
$0.0
FY20
FY21
FY22
FY20
FY21
FY22
SaaS Revenue ($m)
Program Delivery Revenue ($m)
1.644
1.433
1.127
1.611
1.036
$2.0
$1.5
$1.0
$0.5
$0.0
0.000
FY20
FY21
FY22
FY20
FY21
FY22
The Group’s gross sales, which includes all divisions, decreased by 12.9% YoY to $3,628,025. After
deducting revenue shared with education providers, revenue declined by 9.7% YoY to $3,167,310.
Gross Sales (AUD, $m)
Group Revenue (AUD, $m)
4.165
3.628
2.868
$5.0
$4.0
$3.0
$2.0
$1.0
$0.0
3.508
3.167
1.889
$5.0
$4.0
$3.0
$2.0
$1.0
$0.0
FY20
FY21
FY22
FY20
FY21
FY22
- 3 -
OpenLearning Limited and Controlled Entities
Directors’ report
Strategic review complete, working towards break-even
The Company commenced a strategic review of its business in May 2022, which generated interest
from multiple parties and a number of opportunities for the Company. This review has now been
completed and led to the following outcomes:
• Focus on growing the Platform SaaS business in new and existing geographies with a more
streamlined global sales and marketing operation and product-led growth initiatives.
• Strategic investment from the Education Centre of Australia, a leading international education
group that will utilise OpenLearning’s platform and support its growth into new markets.
• Cost optimisation exercise resulting in annualised savings of circa $3.3 million 1 by
reorganising teams, expanding operations in Southeast Asia and optimising cloud hosting
usage.
• Restructure the Program Delivery division and the Transition Program Online (TPO),
resulting in reduced operating and delivery costs and a lower break-even point for the TPO
from FY2023 onwards.
• Target to establish OpenLearning in a substantial new geography through a capital-light
reseller and distribution model in which the Company provides its technology and a partner
takes it to market.
The impact of these initiatives on the Group’s results were not immediately evident in FY2022;
however, the Group has already begun to see an improvement in Q4 FY2022 and in early FY2023.
In particular, the Group implemented a higher-value usage-based SaaS model for platform
subscription, resulting in the discontinuation of lower-value educator plans and personal plans. The
subscription plan now starts from c.$1,000 per year. The Company also adjusted pricing for new
customers and created new usage-based tiers. The change of pricing model resulted in a shift in
customer mix, with some upgrading their plans while others cancelled, leading to an improvement in
revenue per customer.
With these initiatives in place, the Company is confident that it will be able to reach break-even by
growing revenue while closely controlling its costs.
Investment in platform, products and brand in FY2022
The Group continued to invest in developing and marketing its lifelong learning platform and in
ensuring the operational success of its Program Delivery segment which began generating revenue
in FY2021. The Group’s core product offering consists of:
1. OpenLearning SaaS, which enables self-service payment and onboarding for education
providers to utilise OpenLearning’s lifelong learning platform;
2. Biomedical Education Skills and Training (BEST) Network, which enables medical
education to be delivered online with a library of 21,000 medical images from leading
universities;
3. UNSW Transition Program Online, a four-month direct entry program for prospective
international students delivered by OpenLearning in partnership with UNSW Global;
4. CS101, a micro-credential in computer science and programming designed by leading tech
companies and industry experts that the Group is working to license to education providers;
and
1 Based on the annualised difference between Q4 2021 actual and Q4 2022 actual operating expenses and cost of sales
associated with platform subscription.
- 4 -
OpenLearning Limited and Controlled Entities
Directors’ report
5. OpenCreds, a lifelong learning micro-credentialling framework that has been adopted by
education providers in Australia and Malaysia, resulting in over 100 OpenCreds launched on
the platform.
The upfront development costs for the UNSW TPO, CS101 and OpenCreds are now complete and
the Group does not expect any further capital expenditure for these products. As previously
highlighted, the Group’s focus is on developing and promoting its core lifelong learning platform to
ensure that OpenLearning is recognised as a leader in its field and attracts customers across its key
markets.
The Group’s main operating expenses by function and investments spent were:
Operating expenses
Sales and marketing
Platform design and development
Program and service delivery
Year ended
31 December 2022
Year ended
31 December 2021
$
1,440,199
1,136,356
1,820,268
$
1,906,077
1,510,779
2,697,846
Total
4,396,823
6,114,702
As a result of the cost optimisation exercise, which only began to yield results towards the end of
FY2022, the Group’s loss after tax for FY2022 decreased by 16.0% YoY to $5,648,308. The Group’s
cash position ended with $2,204,639 as of 31 December 2022.
Conclusion
The Group successfully executed against a number of key contracts during FY2022 thanks to the
hard work and dedication of employees and the support of its partners. The directors are grateful for
the support of the Group’s shareholders and have made substantial changes to the Group’s
operations to reduce costs, improve margins and position the Group to sustainably grow revenue.
With the completion of the Group’s strategic review in FY2022, the Group is focusing its efforts on
achieving break-even.
- 5 -
OpenLearning Limited and Controlled Entities
Directors’ report
Events after the reporting period
- The Company signed an exclusive Distribution and SaaS Reseller Agreement with the
Education Centre of Australia (‘ECA’) in March 2023 to expand OpenLearning to India. The
Agreement is ongoing (i.e. no fixed term) and is subject to performance thresholds after the
first 3-years that ECA must meet in order to maintain the Agreement and exclusivity.
- OpenLearning India will encompass the Company’s SaaS Platform and a marketplace of
short courses, micro-credentials and online degrees primarily from Indian and Australian
universities.
- Under the Agreement, ECA will actively promote the marketplace to learners and the
OpenLearning’s SaaS Platform to universities in India, Nepal, Sri Lanka and Pakistan (the
Platform Region), while OpenLearning will establish, operate and provide technical support
for the OpenLearning SaaS Platform that will be hosted on Microsoft Azure in India.
- The Company will receive 5% of the gross course sales from the OpenLearning India’s
marketplace and 50% revenue from the SaaS Platform subscription from the Platform
Region.
- The economic materiality of the Agreement is not known at this time as the revenue
generated is dependent on the number of learners who choose to purchase courses through
the OpenLearning India marketplace and the number of universities in the Platform Region
that subscribe to the OpenLearning SaaS Platform. However, the Company views the
Agreement as strategically important as it allows the Company to expand into a new market
in partnership with a well-established international education group.
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.
- 6 -
OpenLearning Limited and Controlled Entities
Directors’ report
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. No other fees were paid or payable to the auditors for non-audit services performed during the
year ended 31 December 2022.
Auditor’s Independence Declaration
The lead auditor’s independence declaration for the year ended 31 December 2022 has been
received and can be found on page 20 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
per share
Number under
Option
28 October 2021
31 August 2024
28 October 2021
27 April 2025
$0.30
$0.30
250,000
1,000,000
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.
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 are 350,000 performance rights convertible to shares on 1:1 basis
on issue (2021: 935,000).
These 350,000 performance rights shall vest over 3 years with 1/3 vesting annually on the condition
that the Company’s volume weighted average share price over any 30 consecutive trading days is
equal to or higher than 55 cents. None of these performance rights vested during FY2022.
Information Relating to Directors and Company Secretary
Spiro Pappas
– Non-Executive Director and Chairman (appointed as Chairman on 25 May
Qualifications
Experience
2022)
– B.Comm (Merit), AICD
– Spiro Pappas is a business leader with over 30 years of experience
predominantly in the financial services industry.
Since leaving NAB in July 2018, Spiro has served on a number of boards.
In addition to his role at Open Learning, Spiro is currently the Chairman of
- 7 -
OpenLearning Limited and Controlled Entities
Directors’ report
Atlas Iron and OpenInvest (Wealthtech). Spiro is also an NED of DataMesh
Group (Payment Fintech) and Cognian Technologies (IoT Proptech).
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 worked in Sydney, London and New York with Deutsche
Bank and then over 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 was a Board Member of the European Australian Business Council.
Spiro was also a member of a taskforce advising the Federal Government
on how to enable the SME sector for the digital age.
Interest in Shares and Options
– 3,679,091 fully paid ordinary shares
Special Responsibilities
– Member of Audit Committee
Directorships held in other listed
entities during the three years
prior to the current year
– Splitit Payments Ltd (Appointed 20 January 2019; Resigned 8 February
2021)
Kevin Barry
– Non-Executive Director (Resigned 30 June 2022) and Chairman (resigned
Qualifications
Experience
25 May 2022)
– B.Comm, LLB
– 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* – 2,110,806 fully paid ordinary shares 1,000,000 options (which expired on 9
December 2022)
Special Responsibilities
– Member of Audit Committee and Remuneration Committee
Directorships held in other listed
entities during the three years
prior to the current year
*as at resignation date, as outlined in Mr Barry’s Appendix 3Z dated 6 July 2022
– Current director of ICS Global Limited (since 23 July 2010)
- 8 -
OpenLearning Limited and Controlled Entities
Directors’ report
Adam Brimo
Qualifications
Experience
– Managing Director and Group CEO
– B.Eng (Software), B.Arts (Politics)
– Adam Brimo is listed in the 2017 Forbes 30 Under 30 Asia for Consumer
Technology, The Pearcey Foundation’s 2018 NSW Tech Entrepreneur Hall
of Fame and is a recipient of the 2011 UNSW Alumni Graduand Award.
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 lifelong learning platform. Since that time,
over 3 million students have joined courses, including the first massive open
online courses (MOOCs) from Australia and Malaysia.
Interest in Shares and Options
– 6,967,475 fully paid ordinary shares
Special Responsibilities
– Group CEO
Directorships held in other listed
entities during the three years
prior to the current year
– None
John Merakovsky
– Non-Executive Director
Qualifications
Experience
– BSc (Hons), PhD
– John Merakovsky is a veteran of the technology industry having previously
been the CEO of leading loyalty and data company Flybuys, and previously
the CEO and Managing Director of ASX-listed Integrated Research Ltd. He
was previously General Manager of SEEK Learning, part of leading
Australian online employment platform SEEK, and before that Managing
Director and CEO Australia and New Zealand for global marketing and
credit services provider Experian.
Mr Merakovsky started his career in the education technology sector as the
founder and CEO of Southrock Corporation, a leading provider of enterprise
Learning and Performance Management Solutions that was acquired by
Talent2 in 2005.
Having originally trained as a molecular biologist and neurogeneticist at the
University of Melbourne, Mr Merakovsky is passionate about building a
better future through sustainable investment in science and technology.
Interest in Shares and Options
– None
Special Responsibilities
Directorships held in other listed
entities during the three years
prior to the current year
– TBA
– TBA
Rupesh Singh
Qualifications
Experience
– Non-Executive Director
– GradDip (IT)
– Founder and Chief Executive Officer of Education Centre of Australia
(ECA). ECA group partners and invest with universities to open campuses
- 9 -
OpenLearning Limited and Controlled Entities
Directors’ report
so that Universities have access to new markets, ECA takes care of all legal
processes and investment requirement to setup campus operation. ECA
currently partners with Australian, UK and Indian Universities. Victoria
university, Swinburne, University of Canberra, Charles Stuart university and
London met university are currently partnering with ECA to offer courses to
students in different locations. ECA has established a strong network of
representatives in 40+ countries to recruit quality students for its university
partners. ECA group also has job ready program and currently offers 2000
plus internship to its students every year. ECA group has its own English
school, 3 vocational institutes and 3 post graduate institutes which awards
its own qualification at post graduate level. One of the speciality ECA group
offers to its university partners is that ECA de risk subcontinent for
universities as ECA has deployed a large team in India and been working
in the region for more than 15 years.
Interest in Shares and Options
– 53,305,946 fully paid ordinary shares
Special Responsibilities
Directorships held in other listed
entities during the three years
prior to the current year
– TBA
– TBA
Professor Beverley Oliver
– Non-Executive Director (resigned 22 March 2022)
Qualifications
Experience
– BA( (Hons), M.Phil PhD W.Aust, GradDipEd Murdoch, GAICD PFHEA
– 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.
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* – 1,000,000 options (which expired on 9 December 2022)
Special Responsibilities
– Member of Remuneration Committee
Directorships held in other listed
entities during the three years
prior to the current year
*as at resignation date, as outlined in Professor Beverly’s Appendix 3Z dated 28 March 2022
– None
Maya Hari
Qualifications
Experience
– Non-Executive Director (resigned 26 April 2022)
– MBA, MS Engineering
– Maya Hari is a global leader in technology as well most recently having
spent 7+ years in Twitter serving as VP, Global Strategy & Operations and
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
- 10 -
OpenLearning Limited and Controlled Entities
Directors’ report
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 a
director of the following entities in Singapore: TIE Singapore (a Non-Profit
focused on fuelling the entrepreneurial ecosystem), Aviva Singlife Holdings
Pte Ltd, Aviva Ltd and Singapore Life Pte Ltd.
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.
Interest in Shares and Options* – 1,000,000 optiones (expired 9 December 2022)
Special Responsibilities
– Member of Remuneration Committee
Directorships held in other listed
entities during the three years
prior to the current year
*as at resignation date, as outlined in Ms Hari’s Appendix 3Z dated 28 April 2022
– None
Benjamin Shields
– Non-Executive Director (resigned 27 January 2023)
Qualifications
Experience
– B.Bus, MBA
– Ben is a senior-level professional with twenty years of corporate strategy,
strategy execution and transformation experience.
In his corporate career and as a consultant, Ben has worked throughout
Asia (China, Singapore, Hong Kong, Indonesia, Korea, Japan), the US
and UK, primarily in the areas of growth strategy, mergers and acquisitions
strategy, commercial & operational due diligence and strategy execution
and organisational transformation.
Ben is Managing Director of Alchemy Growth, a boutique strategy advisory
firm and is a Founding Partner of Alchemy Tribridge, the global investment
firm. Ben was previously a Partner at Deloitte for more than twelve years.
In his community role, Ben is Chair of headspace National Youth Mental
Health Foundation and is a Board member of PCYC NSW.
Ben has a Master of Business Administration from the University of Western
Australia and is a member of the Australian Institute of Company Directors.
Interest in Shares and Options* – 334,903 fully paid ordinary shares
Special Responsibilities
– None
Directorships held in other listed
entities during the three years
prior to the current year
*as at resignation date, as outlined in Mr Sheild’s Appendix 3Z dated 31 January 2023
– None
Nova Taylor
Qualifications
Experience
– Joint Company Secretary (appointed 14 March 2022)
– BA Laws, BA Science – Deakin University
– Ms Taylor has approximately 7 years’ experience working in Company
Secretary and Assistant Company Secretary roles with listed companies.
She previously worked for Computershare Investor Services Pty Limited in
various roles for over 10 years
- 11 -
OpenLearning Limited and Controlled Entities
Directors’ report
Robyn Slaughter
– Joint Company Secretary (appointed 14 March 2022)
Qualifications
– MSc Corporate Governance with Graduate ICSA - London South Bank
Experience
Justyn Stedwell
Qualifications
University
BA (Hons) Accounting and Finance - University of Lincoln
– Ms Slaughter is a qualified Governance Professional (CGI) and Associate
of the Governance Institute of Australia (GIA), who holds a Masters degree
in Corporate Governance and a Bachelors degree in Accounting and
Finance. Ms Slaughter has 5 years’ experience working in Company
Secretarial roles and is currently a Company Secretary of and provides
company secretarial support to various ASX listed, unlisted public and
private companies across a range of Industries including financial services,
biotechnology and healthcare, technology, mining, cyber security and
manufacturing.
– Company Secretary (resigned 14 March 2022)
– 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 15 years’ experience as a Company
Secretary of ASX listed companies in various industries including IT and
telecommunications, mining and exploration, biotechnology and
agriculture.
Meetings of Directors
During the financial year 2022, 10 meetings of directors (including committees of directors) were held.
Attendances by each director during the year was as follows:
Directors’ Meetings
Audit Committee
Remuneration Committee
Number
Number
Number
eligible to
Number
eligible to
Number
eligible to
Number
attend
attended
attend
attended
attend
attended
Kevin Barry*
Adam Brimo
Spiro Pappas
David Buckingham**
Professor Beverley Oliver***
Maya Hari****
Benjamin Shields
John Merakovsky*****
Rupesh Singh******
7
11
11
5
2
3
11
4
2
7
10
10
5
2
3
11
4
1
-
-
-
-
-
-
-
-
-
*Kevin Barry resigned 30 June 2022
**David Buckingham resigned 27 May 2022
***Professor Beverly Oliver resigned 22 March 2022
****Maya Hari resigned 26 April 2022
*****John Merakovsky was appointed to the Board on 30 June 2022
******Rupesh Singh was appointed to the Board on 14 October 2022
- 12 -
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
OpenLearning Limited and Controlled Entities
Directors’ report
- 13 -
OpenLearning Limited and Controlled Entities
Directors’ report
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.
- 14 -
OpenLearning Limited and Controlled Entities
Directors’ report
(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
Non-
monetary
Leave
and Other
Post-employment
Benefits
Pension
and Super-
annuation Other
Long-term Benefits
Equity-settled Share-
based Payments
Incentive
Plans
LSL
Shares/
Units
Options/
Rights
Cash-
settled
Share-
based Pay-
ments
Termin-
ation
Benefits
Total
$
$
$
$
$
$
$
$
$
$
$
$
$
Executive Director
Adam Brimo
2022
250,000
2021
250,000
Non-Executive
Directors
Spiro Pappas
2022
44,823
2021
98,853
Kevin Barry*
2022
32,083
2021
70,000
John Merakovsky
2022
17,500
Rupesh Singh
2021
2022
2021
-
-
-
David Buckingham*
2022
18,939
2021
45,558
Prof. Beverley Oliver*
2022
11,364
2021
45,558
Maya Hari*
2022
19,950
2021
56,131
Benjamin Shields
2022
41,216
2021
3,788
Other KMP
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Cherie Diaz*
2022
195,351
46,580
2021
249,769
Sarveen Kandiah*
2022
81,324
2021
104,681
David Collien
2022
180,000
2021
180,000
Huat Koh*
2022
116,814
2021
180,000
Christina He
2022
111,484
2021
175,000
-
-
-
-
-
-
-
-
-
Total KMP
2022
1,120,848
46,580
2021
1,459,338
-
* Resigned part way through FY2022
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
7,438
24,664
20,029
22,989
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
4,442
8,446
-
-
-
-
-
-
1,894
4,442
1,136
4,442
-
-
4,201
379
-
19,704
10,817
22,989
1,720
10,464
2,237
16,129
3,789
18,450
11,087
17,221
-
9,364
6,376
17,273
1,957
11,498
3,836
17,062
14,904
105,817
54,382
131,372
- 15 -
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
45,564
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
45,564
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
327,666
293,018
49,265
107,299
32,083
70,000
17,500
-
-
-
20,833
50,000
12,500
50,000
19,950
56,131
45,417
4,167
261,635
283,575
93,508
123,047
202,239
208,308
126,178
203,649
124,939
195,898
1,333,713
1,645,092
OpenLearning Limited and Controlled Entities
Directors’ report
(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 for the financial year are set out below:
(a) Adam Brimo - Managing Director and Group CEO
Adam is paid a base salary of $250,000 per annum (plus superannuation). Adam is also
entitled to an incentive bonus of up to $80,000 payable based on achieving selected and
verified performance criteria.
(b) Cherie Diaz - Managing Director, Australia (resigned on 5 August 2022)
Cherie is paid a base salary of $250,000 per annum (plus superannuation). Cherie is also
entitled to an incentive bonus of up to $80,000 payable based on achieving selected and
verified performance criteria and 200,000 performance rights.
(c) Sarveen Kandiah - Managing Director, Malaysia (resigned on 30 September 2022)
Sarveen is paid a base salary of MYR330,000 per annum (plus superannuation). Sarveen is
also entitled to an incentive bonus of up to MYR120,000 payable based on achieving
selected and verified performance criteria and 200,000 performance rights.
(d) David Collien - Chief Technology Officer
David is paid a base salary of $180,000 per annum (plus superannuation). David is also
entitled to an incentive bonus of up to $40,000 payable based on achieving selected and
verified performance criteria and 200,000 performance rights.
(e) Huat Koh - Chief Financial Officer (resigned on 30 June 2022)
Huat is paid a base salary of $180,000 per annum (plus superannuation). Huat is also entitled
to an incentive bonus of up to $20,000 payable based on achieving selected and verified
performance criteria and 200,000 performance rights.
(f) Christina He - Strategy Director
Christina is paid a base salary of $175,000 per annum (plus superannuation). Christina is
also entitled to an incentive bonus of up to $25,000 payable based on achieving selected
and verified performance criteria and 150,000 performance rights.
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.
(iv) Share-based remuneration
Options
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.
5,000,000 options were granted to the Directors as disclosed in the table below in FY2019, with
the following key conditions:
- 16 -
OpenLearning Limited and Controlled Entities
Directors’ report
- 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
950,000 performance rights were issued in FY2020 to the key management personnel
comprising of Cherie Diaz, David Collien, Sarveen Kandiah, Huat Koh and Christina He, as
disclosed in the table below.
These performance rights shall vest over 3 years with 1/3 vesting annually on the condition that
the Company’s volume weighted average share price over any 30 consecutive trading days is
equal to or higher than 55 cents.
Options and rights granted as remuneration
Grant Details
Exercised
Lapsed
Balance at
Beginning
Balance at
of Year
Issue Date
No.
Value
No.
Value
No.
End of Year
$
(Note 1)
$
No.
Directors
Options
Kevin Barry
1,000,000 9/12/2019 1,000,000
31,632
Spiro Pappas
1,000,000 9/12/2019 1,000,000
31,632
David Buckingham 1,000,000 9/12/2109 1,000,000
31,632
Professor Beverley
Oliver
1,000,000 9/12/2019 1,000,000
31,632
Maya Hari
1,000,000 9/12/2019 1,000,000
31,632
5,000,000
5,000,000
158,160
Other KMP
Performance rights
Cherie Diaz
200,000
1/10/2020
200,000
27,714
Sarveen Kandiah
200,000
1/10/2020
200,000
27,714
David Collien
200,000
1/10/2020
200,000
27,714
Huat Koh
200,000
1/10/2020
200,000
27,714
Christina He
150,000
1/10/2020
150,000
20,786
950,000
950,000
131,642
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
1,000,000
1,000,000
1,000,000
1,000,000
1,000,000
5,000,000
200,000
200,000
-
-
-
-
-
-
-
200,000
200,000
-
-
150,000
600,000
350,000
- 17 -
OpenLearning Limited and Controlled Entities
Directors’ report
Vested
Unvested
Balance at End
Total at End of
Total at End of
of Year
Exercisable Unexercisable
No.
No.
No.
Year
No.
Year
No.
(Note 2)
Other KMP
Performance rights
David Collien
Christina He
200,000
150,000
350,000
-
-
-
-
-
-
-
-
-
200,000
150,000
350,000
Note 1
The fair value of performance rights granted to Other KMP 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.
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 performance rights granted as remuneration to those KMP listed in the previous table
are as follows:
Entitlement on
Value per
Amount Paid/
Exercise
Option at
Payable by
Price
Grant Date
Recipient
Grant Date
Issuer
Exercise
Dates Exercisable
$
$
$
Within 3 years on the
condition that the
Company’s volume
weighted average share
price over any 30
1 October 2020
Company
shares
is higher than 55 cents
-
0.139(1)
-
350,000 ordinary
consecutive trading days
(1) Performance right values at grant date were determined using the Black-Scholes method.
- 18 -
OpenLearning Limited and Controlled Entities
Directors’ report
(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:
Balance at
Beginning
of Year
Granted as
Remuneration
during the Year
Issued on Exercise
of Options during
the Year
Other Changes
during the Year
Balance at End of
Year
Adam Brimo
6,682,475
Spiro Pappas
3,679,091
Kevin Barry
1,839,788
John Merakovsky
Rupesh Singh
-
-
David Buckingham
416,666
Prof Beverley Oliver
Maya Hari
-
-
Benjamin Shields
334,903
Cherie Diaz
504,209
Sarveen Kandiah
177,945
David Collien
3,556,743
Huat Koh
152,523
Christina He
-
Total
17,344,343
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
* Shared held by Education Centre of Australia Pty Ltd.
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
285,000
-
271,018
-
6,967,475
3,679,091
2,110,806
-
53,305,946*
53,305,946
(416,666)
-
-
-
84,036
-
-
(151,391)
-
-
-
-
334,903
588,245
177,945
3,556,743
1,132
-
53,377,943
70,722,286
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.
Spiro Pappas
Chairman
Dated: 28 March 2023
- 19 -
OpenLearning Limited and Controlled Entities
Consolidated statement of profit or loss and other comprehensive income
For the financial year ended 31 December 2022
Revenue
Other income
Items of expense
Web-hosting and other direct costs
Employee benefits expense
Depreciation and amortisation
Promotional and advertising
Professional services
General and administrative costs
Capital Loss
Finance income
Finance expenses
Loss before tax
Income tax
Loss for the year
Note
2022
$
2021
$
3
4
5
6
3,167,310
3,507,542
104,424
157,784
(1,105,391)
(5,137,120)
(367,385)
(234,886)
(1,248,465)
(764,119)
(5,585,632)
(58,222)
2,864
(7,318)
(5,648,308)
–
(1,855,441)
(5,846,226)
(288,234)
(495,897)
(1,134,537)
(791,316)
(6,746,325)
–
24,924
(4,679)
(6,726,080)
–
(5,648,308)
(6,726,080)
Other comprehensive income:
Item that may be reclassified subsequently to
profit or loss:
Exchange differences on translating foreign
operations
56,805
(20,797)
Total comprehensive loss for the year
(5,591,503)
(6,746,877)
Loss for the year attributable to:
Owners of the Company
Total comprehensive loss attributable to:
Owners of the Company
(5,597,249)
(6,726,080)
(5,591,503)
(6,746,877)
Losses per share attributable to owners of the
Company
Basic losses per share (cents)
Diluted losses per share (cents)
9
9
(2.55)
(4.02)
(2.55)
(4.02)
This statement should be read in conjunction with the notes to the financial statements.
- 21 -
OpenLearning Limited and Controlled Entities
Consolidated statement of financial position
As at 31 December 2022
ASSETS
Current assets
Trade and other receivables
Prepayments
Cash and cash equivalents
Non-current assets
Furniture, fittings and equipment
Intangible assets
Right-of-use assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Provisions
Lease liabilities
Deferred revenue
Non-current liabilities
Lease liabilities
Total liabilities
Net assets
EQUITY
Note
2022
$
2021
$
10
11
12
13
14
15
16
533,649
170,883
2,204,639
316,154
297,509
4,588,563
2,909,171
5,202,226
35,413
1,636,762
–
64,294
1,145,666
110,134
1,672,175
1,320,094
4,581,346
6,522,320
690,656
363,984
–
1,109,300
1,061,200
342,757
124,998
867,724
2,163,940
2,396,679
–
–
2,163,940
Ssfas
2,417,406
2,396,679
Ssfas
4,125,641
Equity attributable to the owners of the
Company
Share capital
Accumulated losses
Reserves
Total equity
17
18
36,263,511
(35,572,287)
1,726,182
32,495,431
(30,444,116)
2,074,326
2,417,406
4,125,641
This statement should be read in conjunction with the notes to the financial statements.
- 22 -
OpenLearning Limited and Controlled Entities
Consolidated statement of changes in equity
For the financial year ended 31 December 2022
Share
Capital
(Note 17)
$
Reserves
(Note 18)
$
Accumulated
Losses
$
Total
$
Opening balance at 1 January 2022
32,495,431
2,074,326
(30,444,116)
4,125,641
Loss for the year
Other comprehensive income
Foreign currency translation,
representing total other
comprehensive loss for the year
Total comprehensive loss for the
year
Issuance of ordinary shares :
- new ordinary shares
Equity issuance costs
Transfer of fair value of expired
options
Transfer of fair value of lapsed
performance rights
–
–
–
–
(5,648,308)
(5,648,308)
56,805
–
56,805
56,805
(5,648,308)
(5,591,503)
3,883,268
–
(115,188)
115,188
–
–
–
–
(436,993)
436,993
(83,144)
83,144
3,883,268
–
–
–
Closing balance at 31 December
2022
36,263,511
1,726,182
(35,572,287)
2,417,406
This statement should be read in conjunction with the notes to the financial statements.
- 23 -
OpenLearning Limited and Controlled Entities
Consolidated statement of changes in equity
For the financial year ended 31 December 2022
Share
Capital
(Note 17)
$
Reserves
(Note 18)
$
Accumulated
Losses
$
Total
$
Opening balance at 1 January 2021
29,595,431
3,413,423
(25,037,705)
7,971,149
Loss for the year
Other comprehensive income
Foreign currency translation,
representing total other
comprehensive loss for the year
Total comprehensive loss for the
year
Issuance of ordinary shares :
- new ordinary shares
Equity issuance costs
Transfer of fair value of expired
options
Share-based payment
–
–
–
–
(6,726,080)
(6,726,080)
(20,797)
–
(20,797)
(20,797)
(6,726,080)
(6,746,877)
3,100,000
(200,000)
–
–
–
–
3,100,000
(200,000)
–
–
(1,319,669)
1,319,669
–
1,369
–
1,369
Closing balance at 31 December
2021
32,495,431
2,074,326
(30,444,116)
4,125,641
This statement should be read in conjunction with the notes to the financial statements.
- 24 -
OpenLearning Limited and Controlled Entities
Consolidated statement of cash flows
For the financial year ended 31 December 2022
Operating activities
Receipts from customers
Payments to suppliers and employees
Proceeds from other income
Note
2022
$
2021
$
3,840,031
(9,359,075)
110,132
4,555,236
(10,722,518)
157,784
Net cash flows used in operating activities
22
(5,408,912)
(6,009,498)
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 exercise of share options
Repayment of lease liabilities
Repayment of borrowing
Share issue expenses
(12,194)
(726,741)
(28,140)
(710,130)
(738,935)
(738,270)
3,883,268
–
(123,598)
–
–
2,900,000
–
(171,817)
–
–
Net cash flows generated from financing activities
3,759,670
2,728,183
Net (decrease) / increase in cash and cash equivalents
(2,388,177)
(4,019,585)
Effect of exchange rate changes on cash and cash
equivalents
4,253
13,079
Cash and cash equivalents at beginning of the year
4,588,563
8,595,069
Cash and cash equivalents at end of the year
11
2,204,639
4,588,563
This statement should be read in conjunction with the notes to the financial statements.
- 25 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
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 28 March 2023 by the directors of the
Company.
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 a going concern basis, which contemplates
the continuity of normal business activity and the realization and the settlement of liabilities
in the ordinary course of business.
The Group incurred a net loss for the year of $5,648,308 (2021: $6,726,080) and net
operating cash outflows of $5,408,912 (2021: $6,009,498). As at 31 December 2022, the
Group had accumulated losses of $35,572,287 (31 December 2021: $30,444,116).
As at 31 December 2022, the Group has net current assets of $745,231 (31 December 2021:
$2,805,547) and cash and cash equivalents of $2,204,639 (31 December 2021: $4,588,563).
The Group has prepared a cashflow forecast for the next 12 months that indicates a risk that
the Group may not meet all its payment obligations. However, the directors believe that it is
appropriate for the financial statements to be prepared on a going concern basis after
consideration of the following factors:
•
increasing traction in revenue growth of the Platform Subscription segment with improved
gross margins and increasing cash inflow from this segment;
• completion of a strategic review in FY2022 that resulted in a cost reduction exercise that
reduced annualised costs by circa $3.3 million;
• active management of discretionary expenditure in line with funds availability; and
•
raising of additional working capital through the issuance of securities and/or other
funding.
- 26 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
Accordingly, the directors believe that the Group will be able to continue as a going concern
and that it is appropriate to adopt the going concern basis in the preparation of the financial
statements. In the event that the Group is unsuccessful in implementing the above stated
objectives, a material uncertainty exists, that may cast significant doubt on the Group’s ability
as a going concern and its ability to recover assets, and discharge liabilities in the normal
course of business and at the amount shown in the financial statements.
The financial statements do not include any adjustments relating to the recoverability and
classification of recorded asset amounts or to the amounts and classification of liabilities that
might be necessary should the Group not continue as a going concern.
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 20.
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.
- 27 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
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.
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.
Summary of significant accounting policies (cont'd)
1.
- 28 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.5
Furniture, fittings and equipment (cont’d)
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.
(i) Domain names and trademarks
Domain names and trademarks are recognised at cost of acquisition. They are
considered to have an indefinite life and are carried at cost less any impairment losses.
(ii) Platform development
Platform development is recorded at cost. It has a finite life and is carried at cost less
accumulated amortisation and any impairment losses. Platform development has an
estimated useful life of five years. It is assessed annually for impairment.
(iii) Learning platform software
Learning platform 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
- 29 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.6
Intangible assets (cont’d)
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.
(iv) Course design
Course design is costs expended:
-
-
to develop the study courses for the UNSW Transition Program Online, a direct
entry program for students to enter UNSW;
to develop the OpenCreds’ micro-credential courses with interested course
creators, including cash grants given to the course creators to initiate the
development of the courses; and
-
to develop a computer science program titled ‘CS101’.
The costs incurred are capitalised up to the stage when the study courses are ready for
commercial use. They have a finite life and are carried at cost less accumulated
amortisation and any impairment losses. The estimated useful life is based on the period
of contracts or expected obsolescence period.
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.
- 30 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
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 (i.e. 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.
- 31 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.8
Financial instruments (cont’d)
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.
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.
- 32 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
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:
-
- equity instruments measured at fair value through other comprehensive income.
financial assets measured at fair value through profit or loss; or
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.
- 33 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.9
Impairment (cont’d)
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.
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 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.
1.12 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.
- 34 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.12 Employee benefits (cont’d)
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.
1.13 Revenue
Revenue arises from Platform SaaS fees, Program delivery, Marketplace sales and Services
sales.
To determine recognition of revenue, the Group: (i) identifies the contract with a customer,
(ii) identifies the performance obligations in the contract, (iii) determines the transaction price,
(iv) allocates the transaction price to the performance obligations and (v) recognises revenue
when or as each performance obligation is satisfied.
Revenue is recognised either at a point in time or over time, when or as the Group satisfies
performance obligations by transferring the promised goods or services to its customers.
(a) Platform SaaS fees
Revenue from platform SaaS subscription fees is recognised over the period during
which customers are granted access to the platform.
(b) Program delivery
Revenue from program delivery is recognised over the period of the study program.
(c) 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, if any.
- 35 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.13 Revenue (cont’d)
(d) Services sales
Revenue from the provision of services is recognised over time reflecting the progress
for the completion of a performance obligation for which the Group has an enforceable
right to payment.
Platform SaaS, Program delivery 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.
1.14
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:
– 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
–
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:
- 36 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.14
Taxes (cont'd)
– 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
–
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 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
- Receivables and payables are stated with the amount of sales tax included.
- 37 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.15 Borrowing Costs
Borrowing costs are recognised in profit or loss in the period in which they are incurred.
1.16 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.
1.17
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.
- 38 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
1.
Summary of significant accounting policies (cont'd)
1.17
Leases (cont’d)
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.
1.18 New and Amended Accounting Policies Adopted by the Group
The Group has adopted all of the new or amended Accounting Standards and Interpretations
issued by the Australian Accounting Standards Board that are mandatory for the current
reporting period.
Any new or amended Accounting Standards or Interpretations that are not yet mandatory
have not been early adopted.
- 39 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
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 learning platform software and course design
Distinguishing the phases of a new customised software or course design 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.
- 40 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
2.
Critical accounting judgements and estimates (cont’d)
2.2 Key sources of estimation uncertainty (cont’d)
(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.
3.
Revenue
Revenue from contracts with customers
Platform SaaS fees
Program delivery
Marketplace sales
Services sales
Group
2022
$
1,644,233
1,035,951
91,502
395,624
2021
$
1,433,206
1,611,386
69,434
393,516
3,167,310
3,507,542
- 41 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
3.
Revenue (cont’d)
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.
Platform SaaS
2021
2022
$
$
Program delivery
Year ended 31 December
Services
2022
$
2021
$
2022
$
2021
$
Marketplace
2021
$
2022
$
Total
2022
$
2021
$
Geographical
markets
Australia
Malaysia
Singapore
Timing of revenue
recognition
Products and
services transferred
to customers:
At a point in time
Over time
1,153,617
489,051
1,565
977,922 1,035,951 1,611,386 305,094 298,188 87,133
2,137
-
453,325
2,232
-
1,959
1,644,233 1,433,206 1,035,951 1,611,386 395,624 393,516 91,502
90,530 95,328
-
-
-
-
-
- 91,502
-
1,644,233 1,433,206 1,035,951 1,611,386 395,624 393,516
-
1,644,233 1,433,206 1,035,951 1,611,386 395,624 393,516 91,502
-
-
-
66,662 2,581,795 2,954,158
551,425
581,718
1,959
3,797
69,434 3,167,310 3,507,542
2,772
-
69,434
91,502
69,434
- 3,075,808 3,438,108
69,434 3,167,310 3,507,542
4.
Other income
Cash flow boost incentive / Government grant
Gain on lease modification
Others
Group
2022
$
97,106
1,005
6,313
2021
$
139,122
15,241
3,421
104,424
157,784
- 42 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
5.
Loss for the year
Loss before income tax from continuing operations includes the following specific expenses:
Web-hosting and other direct costs
- web-hosting costs
- program delivery licence fee
Employee benefits expense
- share-based payment
Depreciation and amortisation
- depreciation on furniture, fittings and equipment
- depreciation on right-of-use assets
- amortisation of intangible assets
Professional services
- contractors
General and administrative costs
- write-off / loss on disposal of furniture, fittings and
equipment
foreign currency translation losses
impairment of trade receivables
travelling costs
-
-
-
Group
2022
$
2021
$
609,688 963,224
469,700 729,050
–
1,369
19,885
18,721
110,199 164,648
237,801 104,865
663,814 593,325
20,691
11,090
15,940
46,385
–
1,962
17,973
9,841
6.
Income tax
6.1
Income tax expense
There are no income tax expenses for the current and previous financial years as the Group
does not have taxable profits.
At the end of the reporting period, the Group has tax losses of approximately $31,033,000
(2021: $28,123,000) 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.
- 43 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
6.2
The prima facie tax on losses from ordinary activities before income tax is reconciled to the
income tax as follows
Group
2022
$
2021
$
Loss before tax from continuing operations
(5,648,308)
(6,726,080)
Prima facie tax benefit on loss from ordinary activities before
tax at the domestic tax rates where the Group operates
(1,398,286)
(1,729,125)
Add/(subtract):
Tax effect of:
–
–
–
–
non-allowable items
effect of tax losses not recognised
tax benefit of deductible equity raising costs
15,903
(22,624)
724,619
1,952,454
-
-
movement in unrecognised temporary difference
657,764
(200,705)
Income tax attributable to entity
-
-
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
7.
Key Management Personnel
2022
%
25.0
17.0
24.0
2021
%
26.0
17.0
24.0
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 2022.
The totals of remuneration paid to KMP of the Group during the year are as follows:
Short-term employee benefits
Post-employment benefits
Long-term employee benefits
Share-based payments
Total KMP compensation
- 44 -
2022
$
2021
$
1,182,332
1,513,720
105,817
131,372
45,564
-
-
-
1,333,713
1,645,092
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
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 executive directors
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
Group
2022
$
2021
$
Remuneration of the auditor for:
– - auditing or reviewing the financial statements
61,800
57,000
9.
Losses per share
Both the basic and diluted losses per share have been calculated by dividing the loss for the
year attributable to owners of the Company by the weighted average number of ordinary
shares outstanding during the financial year.
The reconciliation of the weighted average number of ordinary shares for the purposes of
calculating the diluted losses per share is as follows:
Weighted average number of ordinary shares for
basic losses per share computation
Effects of dilution from:
- share options issued to convertible note holders
- share options issued to advisors
Weighted average number of ordinary shares for
diluted losses per share computation
31 December
2022
31 December
2021
221,217,695
167,203,638
–
–
–
–
221,217,695
167,203,638
- 45 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
10.
Trade and other receivables
Note
Group
2022
$
2021
$
CURRENT
Trade receivables
Provision for impairment
10a(i)
Other receivables
Provision for impairment
Total current trade and other receivables
513,757
-
513,757
19,892
-
19,892
533,649
299,783
(21,539)
278,244
37,910
-
37,910
316,154
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
measure-
Opening
ment of loss
Amounts
Closing
balance
allowance
written off
balance
1 January
2021
$
31 December
2021
$
$
$
a.
Lifetime Expected Credit Loss:
Credit Impaired
(i)
Current trade receivables
30,223
16,354
(25,038)
21,539
Group
Net
measure-
Opening
ment of loss
Amounts
Closing
balance
allowance
written off
balance
1 January
2022
$
21,539
31 December
2022
$
-
$
-
$
(21,539)
(i)
Current trade receivables
- 46 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
10.
Trade and other receivables (cont’d)
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 2021 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.
Current
>30 days
past due
>60 days
past due
>90 days
past due
$
$
$
$
Total
$
0%
0%
0%
0%
0%
385,752
86,190
18,462
43,245
533,649
-
-
-
-
-
Current
>30 days
past due
>60 days
past due
>90 days
past due
$
$
$
$
Total
$
0%
0%
0%
25.5%
6.4%
149,573
103,669
-
-
-
-
84,451
337,693
21,539
21,539
2022
Expected loss rate
Gross carrying amount
Loss allowing provision
2021
Expected loss rate
Gross carrying amount
Loss allowing provision
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. 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 in liquidation or has entered into bankruptcy proceedings,
or when the trade receivables are over two years past due, whichever occurs earlier.
11.
Cash and cash equivalents
Cash at bank and on hand
Cash with online payment providers
Short-terms deposits placed with banks
- 47 -
Group
2022
$
2021
$
2,186,905
17,734
–
4,559,050
29,513
–
2,204,639
4,588,563
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
12.
Furniture, fittings and equipment
Group
Computer
$
Office
equipment
$
Leasehold
Improvement
$
Total
$
2022
Cost
At 1 January 2022
Additions
Disposals
Exchange difference
At 31 December 2022
Accumulated depreciation
At 1 January 2022
Depreciation for the year
Disposals
Exchange difference
At 31 December 2022
48,195
6,028
(1,366)
30
52,887
16,329
10,056
(369)
47
26,063
21,972
6,166
(9,351)
3
18,790
13,015
3,962
(6,779)
3
10,201
Net carrying amount
26,824
8,589
39,222
–
(39,222)
–
109,389
12,194
(49,939)
33
–
71,677
15,751
5,867
(21,618)
–
–
–
45,095
19,885
(28,766)
50
36,264
35,413
Group
Computer
$
Office
equipment
$
Leasehold
Improvement
$
Total
$
23,171
24,870
154
48,195
9,635
6,574
120
16,329
31,866
21,952
–
20
21,972
8,638
4,361
16
13,015
8,957
35,949
3,273
–
39,222
7,965
7,786
–
15,751
23,471
81,072
28,143
174
109,389
26,238
18,721
136
45,095
64,294
2021
Cost
At 1 January 2021
Additions
Exchange difference
At 31 December 2021
Accumulated depreciation
At 1 January 2021
Depreciation for the year
Exchange difference
At 31 December 2021
Net carrying amount
- 48 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
13.
Intangible assets
Domain
names and
trademarks
Goodwill
$
$
Group
Platform
develop-
ment
$
Learning
platform
software
work-in-
progress
$
Learning
platform
software
$
Course
design
$
Total
$
2022
Cost
At 1 January 2022
Additions
Exchange difference
44,220
22,367
–
24,500
–
–
179,475
623,376
–
At 31 December 2022
66,587
24,500
802,851
Accumulated amortisation
At 1 January 2022
Amortisation for the year
Exchange difference
At 31 December 2022
–
–
–
–
–
–
–
–
–
84,677
–
–
Net carrying amount
66,587
24,500
718,174
2021
Cost
At 1 January 2021
Additions
Exchange difference
37,096
7,124
–
24,500
–
–
–
179,475
–
At 31 December 2021
44,220
24,500
179,475
Accumulated amortisation
At 1 January 2021
Amortisation for the year
Exchange difference
At 31 December 2021
–
–
–
–
–
–
–
–
–
–
–
–
Net carrying amount
44,220
24,500
179,475
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
372,334
–
2,294
686,771
80,998
–
1,307,300
726,741
2,294
374,628
767,769
2,036,335
93,084
37,398
638
68,550
115,226
–
161,634
237,301
638
131,120
183,776
399,573
243,508
583,993
1,636,762
361,242
–
11,092
163,240
523,531
–
586,078
710,130
11,092
372,334
686,771
1,307,300
54,187
36,315
2,582
–
68,550
–
54,187
104,865
2,582
93,084
68,550
161,634
279,250
618,221
1,145,666
Domain names and trademarks are recognised at cost of acquisition. Goodwill represents
premium paid for business assets. These are considered to have an indefinite life and are
carried at cost less any impairment losses.
Platform development is recorded at cost. It has a finite life and is carried at cost less
accumulated amortisation and any impairment losses. Platform development has an
estimated useful life of five years. Amortisation commences when the development is
completed and ready for commercial use.
Learning platform 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.
- 49 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
13.
Intangible assets (cont’d)
Course design is costs expended to develop the OpenCreds’ micro-credential courses, the
computer science program titled ‘CS101’ and the study courses for the UNSW Transition
Program Online. It has a finite life based on the contract periods or expected obsolescence
period and is carried at cost less accumulated amortisation and any impairment losses.
Course design has an estimated useful life of between five and ten years. Amortisation
commences when the courses are 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.
14. Right-of-use assets
The Group’s leases comprise of lease of office premises. These leases have lease terms of
between 2 to 3 years.
i)
AASB 16 related amounts recognised in the balance sheet
Right-of-use assets
Leased office premises
Accumulated depreciation
Exchange difference
Total right-of-use assets
Movement in carrying amounts:
Leased office premises:
At 1 January
Additions / (Lease modification)
Depreciation expense
Exchange difference
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
2022
2021
$
$
478,555
478,581
(478,646)
(369,376)
91
–
929
110,134
110,134
283,561
(26)
(9,708)
(110,199)
(164,648)
91
–
929
110,134
110,199
164,648
1,199
35,719
4,679
8,788
10,001
27,430
170,517
208,035
- 50 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
15
Trade and other payables
CURRENT
Trade payables
Other payables and accrued expenses
a. Financial liabilities at amortised cost
classified as trade and other payables
Trade and other payables:
– total current
Group
2022
$
2021
$
367,338
323,318
701,379
359,821
690,656
1,061,200
690,656
1,061,200
Financial liabilities as trade and other payables
690,656
1,061,200
Trade and other payables are non-interest bearing.
16
Provisions
CURRENT
Provision for annual leave
Provision for long service leave
Group
2022
$
2021
$
318,420
342,757
45,564
–
363,984
342,757
- 51 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
17
Share capital
267,869,075 (31 Dec 2021: 197,358,300) fully paid ordinary
shares
17.1 Movements in ordinary shares
31 December
2022
$
31 December
2021
$
36,263,511
32,495,431
2022
2021
No. of shares
$
No. of shares
$
Group
Issued and fully paid ordinary shares:
At 1 January
Issuance of shares during the year :
- placement of shares
197,358,300
35,295,761
164,024,967
32,195,761
70,510,775
3,883,268
33,333,333
3,100,000
At 31 December
267,869,075
39,179,029
197,358,300
35,295,761
Equity issuance costs
At 1 January
Costs arising from equity issuance
At 31 December
–
–
–
(2,800,330)
(115,188)
(2,915,518)
–
–
–
(2,600,330)
(200,000)
(2,800,330)
Total ordinary shares at 31 December
267,869,075
36,263,511
197,358,300
32,495,431
- 52 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
17.
Share capital (cont’d)
17.2 Movements in unquoted options over ordinary shares
Exercise period
Exercise
price per
share
Number on
issue at 1
Jan 2022
Issued /
(Lapsed)
Number on
issue at 31
Dec 2022
On or before 9 December 2022*
On or before 9 December 2022*
On or before 31 August 2024
On or before 27 April 2025
On or before 30 September
2022*
$0.20
$0.30
$0.30
$0.30
2,793,333
5,000,000
250,000
1,000,000
$0.093
–
2,793,333
5,000,000
–
–
6,422,908/
(6,422,908)
–
–
250,000
1,000,000
–
Total unquoted options
9,043,333
(7,793,333)
1,250,000
* exercise of the options is subject to escrow periods.
17.3 Performance rights
950,000 performance rights were granted on 1 October 2020 to key management personnel
of the Company. These performance rights are exercisable to 950,000 ordinary shares in
the Company with Nil consideration over 3 years with 1/3 vesting annually on the condition
that the Company’s volume weighted average share price over any 30 consecutive trading
days is equal to or higher than 55 cents.
600,000 of these performance rights have lapsed upon the leaving of a key management
person of the Group.
None of these performance rights vested during the financial year 2021.
18.
Reserves
Foreign currency translation reserve
Common control reserve
Share option reserve
(i) Foreign currency translation reserve
Group
2022
$
2021
$
25,838
1,650,477
49,867
(30,967)
1,650,477
454,816
1,726,182
2,074,326
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.
- 53 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
18.
Reserves (cont’d)
(iii) Share option reserve
Share option reserve records items recognised as expenses on valuation of share
options.
19.
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.
(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.
- 54 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
19.
Financial risk management (cont’d)
(a) Liquidity risk (cont’d)
Within 1 Year
1 to 5 Years
Over 5 Years
2022
2021
2022
2021
2022
2021
2022
Group
$
$
$
$
$
$
$
Total
2021
$
533,649 316,154
-
-
-
- 533,649 316,154
2,204,639 4,588,563
-
-
-
- 2,204,639 4,588,563
2,738,288 4,904,717
-
-
-
- 2,738,288 4,904,717
Financial assets
– cash flows
realisable
Trade and other
receivables
Cash and short-
term deposits
Total anticipated
inflows
Financial
liabilities due for
payment
Trade and other
payables
690,656 1,061,200
Lease liabilities
- 124,998
Total expected
outflows
Net
inflow/(outflow) on
financial
instruments
690,656 1,186,198
2,047,632 3,718,519
(b) Credit risk
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
690,656
1,061,200
- 124,998
690,656 1,186,198
- 2,047,632 3,718,519
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.
- 55 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
19
Financial risk management (cont’d)
(b) Credit risk (cont’d)
Credit risk concentration profile
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 within 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.
(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.
2022
Group
Functional currency of entity:
Australian dollar
Statement of financial position
exposure
2021
Group
Functional currency of entity:
Australian dollar
Statement of financial position
exposure
Net Financial Assets/(Liabilities) in AUD
USD
SGD
Other
Total AUD
(11,668)
(11,668)
(821)
(821)
-
-
(12,489)
(12,489)
Net Financial Assets/(Liabilities) in AUD
USD
SGD
Other
Total AUD
30,135
30,135
1,398
1,398
-
-
31,533
31,533
- 56 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
19
Financial risk management (cont’d)
(c) Foreign currency risk (cont’d)
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 demonstrates the sensitivity of profit/(loss) and equity to a
reasonably possible change in interest rates of +/- 50 basis points, with all other
variables held constant.
Year ended 31 December 2022
+0.5% in interest rates
-0.5% in interest rates
Year ended 31 December 2021
+0.5% in interest rates
-0.5% in interest rates
Group
Profit
$
Equity
$
11,023
(11,023)
22,943
(22,943)
11,023
(11,023)
22,943
(22,943)
- 57 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
20
Interests in subsidiaries
Name
Principal activities
Country of
incorporation
Proportion (%) of
ownership interest
2021
%
2022
%
Held by the Company
OLG Australia
Investors Pte Ltd
OpenLearning Global
Pte Ltd
Held by OpenLearning
Global Pte Ltd
Open Learning Global
Pty Ltd
Investment holding
Singapore
–*
100
Investment holding and
provision of online
education platform
and services
Singapore
100
100**
Provision of online
Australia
100
100
program management,
online education
platform and services.
OpenLearning Global
(M) Sdn Bhd
Provision of online
education platform
and services.
* OLG Australia Investors Pte Ltd was stuck off on 3 October 2022.
** 63.89% held via OLG Australia Investors Pte Ltd
Malaysia
100
100
21
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 has in previous financial years reported its operating segments on the basis of
geographical locations i.e. Australia, Malaysia, Singapore and Corporate (based in
Australia). The Group has now revised its reportable operating segments on the basis of
revenue and cost originations, as follows:
(a) Australia
(b) South East Asia
(c) Global Platform
(d) Global Services
(e) Corporate Overheads
- 58 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
21
Operating segments (cont’d)
Australia
$
South East
Asia
$
Global
Platform
$
Global
Services
$
Corporate
Overheads
$
Total
$
2,406,514
612,336
148,460
–
–
3,167,310
(495,702)
(2,396,162)
(228,494)
(226,253)
(204,867)
(123,532)
(1,268,496)
–
(628,543)
(54,214)
(8,633)
(122,106)
(53,543)
(254,703)
–
–
–
–
–
–
148,460
–
–
(609,689)
(1,075,289)
(84,677)
–
(515,479)
(280,028)
(2,565,162)
–
(1,037,126)
–
–
(406,013)
(265,268)
(1,708,407)
(1,105,391)
(5,137,120)
(367,385)
(234,886)
(1,248,465)
(722,371)
(5,648,308)
–
–
1,488,801
4,581,346
392,847
2,163,940
Segment assets
2,624,402
468,143
Segment liabilities
1,374,051
397,042
Australia
$
South East
Asia
$
Global
Platform
$
Global
Services
$
Corporate
Overheads
$
Total
$
2,741,436
555,027
211,079
–
–
3,507,542
(847,879)
(2,429,197)
(212,518)
(445,945)
(244,963)
(136,761)
(1,470,541)
(15,568)
(817,583)
(38,675)
(20,642)
(37,248)
(21,710)
(381,107)
–
–
–
–
–
–
211,079
–
–
(991,994)
(1,763,546)
(36,744)
(475)
(539,913)
(278,790)
(3,736,151)
–
(835,900)
(297)
(28,835)
(312,413)
(354,055)
(1,349,360)
(1,855,441)
(5,846,226)
(288,234)
(495,897)
(1,134,537)
(791,316)
(6,726,080)
–
–
2,351,700
6,522,320
406,980
2,396,679
2022
Revenue:
External sales
Segment results:
Web-hosting and other direct
costs
Employees benefit expenses
Depreciation and amortisation
Promotional and advertising
Professional services
General and administration
Segment profit/(loss)
2021
Revenue:
External sales
Segment results:
Web-hosting and other direct
costs
Employees benefit expenses
Depreciation and amortisation
Promotional and advertising
Professional services
General and administration
Segment profit/(loss)
Segment assets
3,592,693
577,927
Segment liabilities
1,435,977
553,722
- 59 -
OpenLearning Limited and Controlled Entities
Notes to the financial statements – 31 December 2022
22.
Cash flow information
Reconciliation of cash flows from operating activities with loss after income tax:
Group
2022
$
2021
$
Loss after tax
(5,648,308)
(6,726,080)
Non-cash flows in loss for the year:
Depreciation and amortisation
Write-off / Loss on disposal of furniture, fittings and
equipment
Unrealised exchange (gain) / loss
Gain on lease modification
Share-based payment
Changes in assets and liabilities:
Decrease in trade and other receivables
Increase in trade and other payables
367,385
288,234
21,173
50,823
(1,374)
–
–
(43,355)
(15,241)
1,369
(182,498)
(16,113)
39,461
446,114
Net cash flows used in operating activities
(5,408,912)
(6,009,498)
23. Events after the reporting period
-
The Company signed an exclusive Distribution and SaaS Reseller Agreement with the
Education Centre of Australia (‘ECA’) in March 2023 to expand OpenLearning to India. The
Agreement is ongoing (i.e. no fixed term) and is subject to performance thresholds after the
first 3-years that ECA must meet in order to maintain the Agreement and exclusivity.
- OpenLearning India will encompass the Company’s SaaS Platform and a marketplace of
short courses, micro-credentials and online degrees primarily from Indian and Australian
universities.
- Under the Agreement, ECA will actively promote the marketplace to learners and the
OpenLearning’s SaaS Platform to universities in India, Nepal, Sri Lanka and Pakistan (the
Platform Region), while OpenLearning will establish, operate and provide technical support
for the OpenLearning SaaS Platform that will be hosted on Microsoft Azure in India.
- The Company will receive 5% of the gross course sales from the Openlearning India’s
marketplace and 50% revenue from the SaaS Platform subscription from the Platform
Region.
- The economic materiality of the Agreement is not known at this time as the revenue
generated is dependent on the number of learners who choose to purchase courses through
the OpenLearning India marketplace and the number of universities in the Platform Region
that subscribe to the OpenLearning SaaS Platform. However, the Company views the
Agreement as strategically important as it allows the Company to expand into a new market
in partnership with a well-established international education group.
- 60 -
OpenLearning Limited and Controlled Entities
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.
b.
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
give a true and fair view of the financial position as at 31 December 2022 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
Spiro Pappas
Chairman
Dated: 28 March 2023
- 61 -
OPENLEARNING LIMITED
ABN 18 635 890 390
AND CONTROLLED ENTITIES
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
OPENLEARNING LIMITED
AND CONTROLLED ENTITIES
Opinion
We have audited the financial report of OpenLearning Limited (the Company) and controlled entities
(the Group), which comprises the consolidated statement of financial position as at 31 December 2022,
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 other explanatory information, and the directors’ declaration.
In our opinion, the accompanying financial report of OpenLearning Limited and controlled entities is in
accordance with the Corporations Act 2001, including:
(a)
(b)
giving a true and fair view of the Group’s financial position as at 31 December 2022 and of its
performance for the year then ended; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
Basis of 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
responsibility section of our report. We are independent of the Company in accordance with 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 $5,648,308 and operating cash outflows of $5,408,912 during the year ended 31 December
2022. 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.
Shareholder Information
The shareholder information set out below was applicable as at 9 March 2023.
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
Marketable Parcels
NUMBER
OF HOLDERS
49
393
273
655
217
1,587
NUMBER
OF UNITS
8,060
1,214,280
2,232,670
23,371,501
241,042,564
267,869,075
% OF TOTAL
ISSUED CAPITAL
0.00%
0.45%
0.83%
8.73%
89.99%
100.00%
Based on the price per security, number of holders with an unmarketable holding: 1,121 with total
11,515,308 amounting to 4.3% of Issued Capital.
B. Distribution of Equity Securities – Unlisted Share Options
Analysis of numbers of option holders by size of holding
SPREAD OF HOLDINGS
UNLISTED OPTIONS AT $0.30, EXP 27/04/25
100,001 AND OVER
UNLISTED OPTIONS AT $0.30, EXP 31/08/24
10,001 – 100,000
NUMBER
OF
HOLDERS
1
5
NUMBER
OF UNITS
% OF TOTAL
CAPITAL
1,000,000
100.00%
250,000
100.00%
C. Distribution of Equity Securities – Performance Rights
Analysis of numbers of Performance Rights holders by size of holding:
SPREAD OF HOLDINGS
100,001 AND OVER
NUMBER
OF
HOLDERS
2
NUMBER
OF UNITS
350,000
% OF TOTAL
ISSUED CAPITAL
100.00%
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
ECA INVESTMENTS GROUP PTY LTD
ALCHEMY TRIBRIDGE SAPPHIRE PTY LTD
MAGNA INTELLIGENT SDN BHD
MR ADAM MAURICE BRIMO
BNP PARIBAS NOMS(NZ) LTD
RICHARD BUCKLAND
AUSTRALIAN CATHOLIC UNIVERSITY LIMITED
NARRON PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
ORIENT GLOBAL HOLDINGS PTY LTD
MS MEILIN MU
NICOLETTE HARPER
CLAPSY PTY LTD
FRANK NOEL BEAUMONT
MR NICK THEODORAKOPOULOS
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV
LTD
MR DAVID ANDREW COLLIEN
MR CLIVE ALYN MAYHEW-BEGG
REMB NOMINEES PTY LTD
ORDINARY
SHARES
NUMBER HELD
53,305,946
36,379,929
12,294,595
6,631,117
5,787,121
5,094,288
5,000,000
3,981,809
3,855,101
3,205,444
2,899,891
2,720,758
2,500,000
2,367,021
2,342,858
2,333,333
2,332,357
2,133,161
2,132,871
2,061,887
% OF ISSUED
SHARES
19.90%
13.58%
4.59%
2.48%
2.16%
1.90%
1.87%
1.49%
1.44%
1.20%
1.08%
1.02%
0.93%
0.88%
0.87%
0.87%
0.87%
0.80%
0.80%
0.77%
As at 9 March 2023, the 20 largest shareholders held ordinary shares representing 59.49% of the issued
share capital.
Substantial Shareholders Substantial holders in the Company are set out below:
As at 9 March 2023, the following shareholders have disclosed a substantial shareholder notice to the
ASX:
NAME
ALCHEMY TRIBRIDGE SAPPHIRE PTY LTD AND
ASSOCIATED ENTITIES
CLIVE MAYHEW
ECA INVESTMENTS GROUP PTY LIMITED
ORDINARY SHARES HELD DATE OF NOTICE
36,379,929
25/01/22
8,288,754
53,305,946
19/12/19
08/12/22
E. Unquoted Equity Securities – Unlisted Options
Holders of more than 20% of unlisted options security holders.
UNLISTED OPTIONS AT $0.30, EXP 27/04/25
HIGH RESOLVES
UNLISTED OPTIONS AT $0.30, EXP 31/08/24
PRASHANT VARANASI
HANNAH BEDER
ALEXANDER LAURANCE NORTH
MIN’AN TAN
MARTHA WINATA
Partly Paid Shares
The Company does not have any partly paid shares on issue.
Voting Rights
The voting rights attached to ordinary shares are set out below:
NUMBER
OF UNITS
% OF TOTAL
CAPITAL
1,000,000
100.00%
50,000
50,000
50,000
50,000
50,000
20.00%
20.00%
20.00%
20.00%
20.00%
On a show of hands every member present at a meeting in person or by proxy shall have one vote and
upon a poll each share shall have one vote.
There are no voting rights attached to any other securities on issue.
On-market buy-back
The Company is not currently conducting an on-market buy-back.
Other ASX Information
Corporate Governance
The Company’s Corporate Governance Statement as at 31 December 2022 as approved by the Board can
be viewed at https://solutions.openlearning.com/investor-center
Stock Exchange on which the Company’s Securities are Quoted
The Company’s listed equity securities are quotes on the Australian Securities Exchange
Review of Operations
A review of operations is contained in the Directors Report.
Annual General Meeting
The Company advises that the Annual General Meeting ('AGM') of the company is scheduled for 31 May
2023.
Further to Listing Rule 3.13.1, Listing Rule 14.3 and clause 14.3 of the Company's Constitution,
nominations for election of directors at the AGM must be received not less than 30 Business Days before
the meeting, being no later than Tuesday, 18 April 2023.