2019
ANNUAL REPORT
A.B.N 58 081 688 164
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONTENTS
CORPORATE DIRECTORY
Directors’ Report
2
BOARD
Remuneration Report
Auditor’s Independence Declaration
Consolidated Statement of
Profit or Loss and
Other Comprehensive Income
8
15
16
Farooq Khan (Chairman and Managing Director)
(Executive Director)
(Non-Executive Director)
Victor Ho
Yaqoob Khan
COMPANY SECRETARY
Victor Ho
Consolidated Statement of
Financial Position
Consolidated Statement of
Changes in Equity
17
PRINCIPAL & REGISTERED OFFICE
Level 2
18
23 Ventnor Avenue
West Perth, Western Australia 6005
Telephone:
Facsimile:
(08) 9214 9777
(08) 9214 9701
info@queste.com.au
www.queste.com.au
Consolidated Statement of Cash Flows
19
Email:
Website:
Notes to the Consolidated Financial
20
Statements
Directors’ Declaration
Independent Audit Report
Additional ASX Information
48
49
52
AUDITORS
Rothsay Auditing
Chartered Accountants
Level 1, Lincoln House
4 Ventnor Avenue
West Perth, Western Australia 6005
Telephone:
Website:
(08) 9486 7094
www.rothsayresources.com.au
STOCK EXCHANGE
Australian Securities Exchange
Perth, Western Australia
ASX CODE
QUE
Queste’s 2019
Corporate Governance Statement
can be found at the following
URL on the Company’s website:
http://www.queste.com.au/corporate-governance
SHARE REGISTRY
Advanced Share Registry Limited (ASX:ASW)
Main Office
110 Stirling Highway
Nedlands, Western Australia 6009
Local Telephone:
Telephone:
Facsimile:
Email:
1300 113 258
(08) 9389 8033
(08) 9262 3723
admin@advancedshare.com.au
Visit www.queste.com.au for:
•
•
•
•
•
Market Announcements
Financial Reports
Corporate Governance
Forms
Email subscription
Investor Web:
www.advancedshare.com.au
Sydney Office
Suite 8H, 325 Pitt Street
Sydney, New South Wales 2000
Telephone:
(02) 8096 3502
ANNUAL REPORT | 1
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
The Directors present their report on Queste Communications Ltd ABN 58 081 688 164 (Company or QUE) and
its controlled entities (Queste or the Consolidated Entity) for the financial year ended 30 June 2019 (Balance
Date).
QUE is a public company limited by shares that is incorporated and domiciled in Western Australia and has been
listed on the Australian Securities Exchange (ASX) since November 1998. (ASX Code: QUE)
Queste’s results incorporate the results of controlled entity, ASX-listed investment company, Orion Equities
Limited ABN 77 000 742 843 (Orion or OEQ). The Company has a 59.86% (9,367,653 shares) shareholding
interest in Orion (30 June 2018: 59.86% (9,367,653 shares)).
PRINCIPAL ACTIVITIES
The principal activity of the Company during the financial year was the management of its assets.
The principal activities of controlled entity, Orion, during the financial year were the management of its
investments, including investments in listed and unlisted securities and real estate held for development and
resale.
FINANCIAL POSITION
COMPANY
Cash and cash equivalents
Current investments - equities
Investment in controlled entity (OEQ)
Receivables
Deferred tax assets
Other assets
Total Assets
Tax liabilities (current and deferred)
Other payables and liabilities
Net Assets
Issued capital
Reserves
Accumulated losses
Total Equity
OPERATING RESULTS
COMPANY
Total revenues
Net gain/(loss) on financial assets
Share of Associate entity’s profit/(loss)
Other Expenses
Profit/(Loss) before tax
Income tax expense
Profit/(Loss) for the year
2019
$
36,672
3
Restated
2018
$
123,108
15,302
1,124,118
1,545,663
15,970
523,632
40,222
3,906
523,632
54,325
1,740,617
2,265,936
-
-
(227,656)
(202,789)
1,512,961
2,063,148
6,239,370
2,347,229
6,239,370
2,347,229
(7,073,638)
(6,523,451)
1,512,961
2,063,148
2019
$
182,773
(421,844)
Restated
2018
$
233,614
-
-
(46,955)
(311,116)
(144,170)
(550,187)
42,489
-
-
(550,187)
42,489
ANNUAL REPORT | 2
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
EARNINGS PER SHARE
CONSOLIDATED ENTITY
Basic and diluted loss per share (cents)
2019
(3.36)
Restated
2018
(2.80)
Weighted average number of fully paid ordinary shares in the Company outstanding
during the year used in the calculation of basic and diluted earnings per share
27,072,332
27,158,058
DIVIDENDS
The Company’s Directors have not declared a dividend.
SECURITIES ON ISSUE
At the Balance Date (and currently), the Company had 27,072,332 listed fully paid ordinary shares (30 June
2018: 27,072,332 fully paid ordinary shares) on issue.
All such shares are listed on ASX. The Company does not have other securities on issue.
REVIEW OF OPERATIONS
1.
Orion Equities Limited (ASX: OEQ)
1.1. Current Status of Investment in Orion
Orion is an investment entity.
The Company holds 9,367,653 shares in Orion, being 59.86% of its issued ordinary share capital (2018:
9,367,653 shares and 59.86%). Orion has been recognised as a controlled entity and included as part of
the Queste’s results since 1 July 2002.
Queste shareholders are advised to refer to the 30 June 2019 Full Year Report and monthly NTA
disclosures lodged by Orion for further information about the status and affairs of the company.
Information concerning Orion may be viewed from its website: www.orionequities.com.au
Orion’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX
code “OEQ”.
Sections 1.2 and 1.3 below contain information extracted from Orion’s public statements.
1.2. Orion’s Portfolio Details as at 30 June 2019
Asset Weighting
Australian equities
Agribusiness 1
Property held for development and resale
Net tax liabilities (current-year and deferred tax assets/liabilities)
Net cash/other assets and provisions
TOTAL
% of Net Assets
2019
36%
-
43%
-
21%
100%
2018
45%
35%
31%
-
(11)%
100%
1 Agribusiness net assets include olive grove land, olive trees, buildings and plant and equipment which were sold in October
2018.
ANNUAL REPORT | 3
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Major Holdings in Securities Portfolio
Equities
Bentley Capital Limited
Strike Resources Limited
TOTAL
Fair Value
$’million
% of Net
Assets
ASX
Code
1.54
0.45
77%
23%
BEL
SRK
1.99
100%
Industry
Sector
Exposures
Diversified
Materials
1.3. Orion’s Assets
(a) Bentley Capital Limited (ASX: BEL)
Bentley is a listed investment company.
Queste holds 1.61% (1,225,752 shares) of Bentley’s issued ordinary share capital with Orion holding
26.95% (20,513,783 shares) of Bentley’s issued ordinary share capital (2018: Queste held 1,225,752
shares (1.61%) and Orion held 20,513,783 shares (26.95%)).
Bentley’s asset weighting as at 30 June 2019 was 98% Australian equities (2018: 95%) and 2% net
cash/other assets (2018: 3.9%).
Bentley had net assets of $6.35 million as at 30 June 2019 (2018: $9.347 million) and incurred an after-
tax net loss of $2.458 million for the financial year (2018: $1.844 million after-tax net profit).
During the financial year, Bentley paid a 0.50 cent fully franked dividend that was distributed in July 2018.
Queste and Orion received a total of $108,698 dividends from Bentley during the financial year (2018:
$109,069).
Shareholders are advised to refer to the 30 June 2019 Full Year Report and monthly NTA disclosures
lodged by Bentley for further information about the status and affairs of the company.
Information concerning Bentley may be viewed from its website: www.bel.com.au.
Bentley’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX
code “BEL”.
(b) Strike Resources Limited (ASX: SRK)
Strike owns the high grade Apurimac Magnetite Iron Ore Project and Cusco Magnetite Iron Ore Project in
Peru and the Paulsens East Iron Ore Project in Western Australia. Strike is also developing a number of
battery minerals related projects around the world, including the highly prospective Solaroz Lithium Brine
Project in Argentina, the Burke Graphite Project in Queensland and a lithium exploration tenement in
Western Australia.2
As at 30 June 2019, Orion holds 10,000,000 Strike shares (6.88%) (2018: 10,000,000 shares (6.88%))
while Associate entity, Bentley, holds 52,553,493 Strike shares (36.16%) (2018: 52,553,493 SRK shares
(36.16%). Therefore, Orion has a deemed relevant interest in 62,553,493 Strike shares (43.041%3).
On 18 July 2019, Strike raised $0.981 million through a placement of 21,800,000 shares. Accordingly,
Orion’s interest in Strike has diluted to 5.983%, Bentley’s interest in Strike has diluted to 31.4%4, and
Orion’s deemed relevant interest in Strike has diluted to 37.427%5.
2 Refer SRK’s ASX Announcement dated 27 July 2019: June 2019 Quarterly Reports
3 Refer Orion’s ASX Announcement dated 4 September 2015: Change in Substantial Holding Notice
4 Refer Bentley’s ASX Announcement dated 22 July 2019: Change in Substantial Holding in SRK
5 Refer Orion’s ASX Announcement dated 22 July 2019: Change in Substantial Holding Notice
ANNUAL REPORT | 4
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Information concerning Strike may be viewed from its website: www.strikeresources.com.au
Strike’s market announcements may also be viewed from the ASX website (www.asx.com.au) under ASX
code “SRK”.
(c) Other Assets
In October 2018, Orion sold its 143 hectare commercial olive grove operation (which was on care and
maintenance) located in Gingin, Western Australian for $1.46 million (gross). Orion generated a net gain
of $0.202 million from the sale.
Orion also owns a property held for redevelopment or sale but currently rented out located in Mandurah,
Western Australia.
2.
Queste’s Other Assets
In addition to the investment in controlled entity, Orion, Queste has a direct share investment in Associate
entity, Bentley, being 1,225,752 shares (or 1.61% of Bentley’s issued ordinary share capital) (2018:
1,225,752 shares and 1.61%).
The Company notes that it lodges Monthly and Quarterly Cash Flow Reports on ASX, which may be viewed
and downloaded from the Company’s website: www.queste.com.au or the ASX website (www.asx.com.au)
under ASX Code: “QUE”.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the Consolidated Entity that occurred during the
financial year not otherwise disclosed in this Directors’ Report or the Consolidated Financial Statements.
FUTURE DEVELOPMENTS
The Consolidated Entity intends to continue its investment activities in future years. The results of these
investment activities depend upon the performance of the underlying companies and securities in which the
Consolidated Entity invests. The investments’ performances depend on many economic factors and also industry
and company specific issues. In the opinion of the Directors, it is not possible or appropriate to make a
prediction on the future course of markets, the performance of the Consolidated Entity’s investments or the
forecast of the likely results of the Consolidated Entity’s activities.
ENVIRONMENTAL REGULATION
The Consolidated Entity is not subject to any particular or significant environmental regulation under Australian
Commonwealth or State legislation.
ANNUAL REPORT | 5
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
DIRECTORS
Information concerning Directors in office during or since the financial year:
Farooq Khan
Executive Chairman and Managing Director
Appointed 10 March 1998
Qualifications BJuris, LLB (Western Australia)
Experience Mr Khan is a qualified lawyer having previously practised principally in the field of corporate law.
Mr Khan has extensive experience in the securities industry, capital markets and the executive
management of ASX-listed companies. In particular, Mr Khan has guided the establishment and
growth of a number of public listed companies in the investment, mining and financial services
sectors. He has considerable experience in the fields of capital raisings, mergers and acquisitions
and investments.
Relevant interest in shares 5,344,872 shares6
Other current directorships
in listed entities
(1)
(2)
(3)
Executive Chairman of Bentley Capital Limited (ASX:BEL) (since 2 December 2003)
Executive Chairman of Orion Equities Limited (ASX:OEQ) (since 23 October 2006)
Chairman (appointed 18 December 2015) of Strike Resources Limited (ASX:SRK) (Director
since 1 October 2015)
Former directorships in
other listed entities in past
3 years
None
Victor P. H. Ho
Executive Director and Company Secretary
Appointed Executive Director since 3 April 2013; Company Secretary since 30 August 2000
Qualifications BCom, LLB (Western Australia), CTA
Experience Mr Ho has been in Executive roles with a number of ASX listed companies across the
investments, resources and technology sectors over the past 19 years. Mr Ho is a Chartered
Tax Adviser (CTA) and previously had 9 years’ experience in the taxation profession with the
Australian Tax Office (ATO) and in a specialist tax law firm. Mr Ho has been actively involved in
the investment management of listed investment companies (as an Executive Director and or a
member of the Investment Committee), the structuring and execution of a number of corporate,
M&A and international joint venture (in South America, Indonesia and the Middle East)
transactions, capital raisings and capital management initiatives and has extensive experience in
public company administration, corporations’ law and stock exchange compliance and
investor/shareholder relations.
Relevant interest in shares 17,500 shares 7
Other current positions
held in listed entities
(1)
(2)
(3)
(4)
Executive Director and Company Secretary of Orion Equities Limited (ASX:OEQ)
(Secretary since 2 August 2000 and Director since 4 July 2003)
Director and Company Secretary of Strike Resources Limited (ASX:SRK) (Director since
24 January 2014 and Company Secretary since 1 October 2015)
Company Secretary of Bentley Capital Limited (ASX:BEL) (since 5 February 2004)
Company Secretary of Keybridge Capital Limited (ASX:KBC) (since 13 October 2016)
Former positions in other
listed entities in past 3
years
None
6 Refer Farooq Khan’s Change of Director’s Interest Notices dated 10 July 2019 and 8 January 2018
7 Refer Victor Ho’s Initial Director’s Interest Notice dated 3 April 2013
ANNUAL REPORT | 6
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
Yaqoob Khan
Non-Executive Director
Appointed 10 March 1998
Qualifications BCom (Western Australia), Master of Science in Industrial Administration (Carnegie Mellon)
Experience After working for several years in the Australian Taxation Office, Mr Khan completed his
postgraduate Masters degree and commenced work as a senior executive responsible for
product marketing, costing systems and production management. Mr Khan has been an
integral member of the team responsible for the pre-IPO structuring and IPO promotion of a
number of ASX floats and has been involved in the management of such companies. Mr Khan
brings considerable international experience in key aspects of corporate finance and the
strategic analysis of listed investments.
Relevant interest in shares 68,345 shares 8
Other current
directorships in listed
entities
Non-Executive Director of Orion Equities Limited (ASX:OEQ) (since 5 November 1999).
Former directorships in
other listed entities in past
3 years
None
At the Balance Date, Yaqoob Khan is a resident overseas.
At the Company’s 2018 AGM9:
•
Victor Ho retired as a Director (by rotation) pursuant to the Company’s Constitution and was re-elected a
Director at that AGM.
DIRECTORS' MEETINGS
The following table sets out the numbers of meetings of the Company's Directors held during the financial year
(including Directors’ circulatory resolutions), and the numbers of meetings attended by each Director of the
Company:
Name of Director
Meetings Attended
Maximum Possible Meetings
Farooq Khan
Yaqoob Khan
Victor Ho
4
4
4
4
4
4
There were no meetings of committees of the Board of the Company.
Board Committees
During the financial year and as at the date of this Directors’ Report, the Company did not have separate
designated Audit or Remuneration Committees. In the opinion of the Directors, in view of the size of the
Board and nature and scale of the Queste’s activities, matters typically dealt with by an Audit or
Remuneration Committee are dealt with by the full Board.
8 Refer Yaqoob Khan’s Change of Director’s Interest Notice dated 6 September 2011
9 Refer Queste’s ASX announcement dated 28 November 2018: Results of 2018 Annual General Meeting
ANNUAL REPORT | 7
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
This Remuneration Report details the nature and amount of remuneration for each Director and Company
Executive (being a company secretary or senior manager) (Key Management Personnel) of Queste.
The information provided under headings (1) to (6) below has been audited for compliance with section 300A of
the Corporations Act 2001 (Cth) as required under section 308(3C).
(1) Remuneration Policy
The Board determines the remuneration structure of all Key Management Personnel having regard to the
Company’s strategic objectives, scale and scope of operations and other relevant factors, including
experience and qualifications, length of service, the duties and accountability of Key Management
Personnel, the frequency of Board meetings, market practice (including available data concerning
remuneration paid by other listed companies and in particular, companies of comparable size and nature)
and the objective of maintaining a balanced Board which has appropriate expertise and experience, at a
reasonable cost to the Company.
Corporate Governance Principles: The Company’s Corporate Governance Statement (CGS) also
addresses matters pertaining to the Board, Senior Management and Remuneration. The latest version of
the CGS may be downloaded from the Company’s website: http://queste.com.au/corporate-governance
Fixed Cash Short Term Employment Benefits: The Key Management Personnel of the Company are
paid a fixed amount per annum plus applicable employer superannuation contributions. The Non-
Executive Directors of the Company are paid a maximum aggregate base remuneration of $75,00010 per
annum inclusive of minimum employer superannuation contributions where applicable, to be divided as
the Board determines appropriate.
The Board has determined the following fixed cash remuneration for current Key Management Personnel
during the year as follows:
Executive Director
(1) Mr Farooq Khan (Executive Chairman and Managing Director) - a base salary of $31,250 (previously
voluntarily reduced from $62,500 to $31,250 (with effect on 1 April 2016) and from $125,000 to
$62,500 (with effect on 1 April 2013) to assist the Company in reducing its corporate overheads)
per annum plus employer superannuation contributions; and
(2) Mr Victor Ho (Executive Director and Company Secretary) - a base salary of $22,500 (previously
voluntarily reduced from $45,000 to $22,500 (with effect on 1 April 2016) to assist the Company in
reducing its corporate overheads) per annum plus employer superannuation contributions. Mr Ho
also agreed to join the Board as an Executive Director on 3 April 2013 at no further cost to the
Company.
Non – Executive Director
(3) Mr Yaqoob Khan (Non-Executive Director) - a base fee of $15,000 per annum.
Key Management Personnel can also opt to “salary sacrifice” their cash fees/salary and have them paid
wholly or partly as further employer superannuation contributions or benefits exempt from fringe benefits
tax.
10 As approved by shareholders at the Annual General Meeting held on 30 November 1999; refer Queste’s ASX announcement
dated 30 November 1999: Results of Annual General Meeting of Shareholders
ANNUAL REPORT | 8
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
Special Exertions and Reimbursements: Pursuant to the Company’s Constitution, each Director is
entitled to receive:
(a)
(b)
Payment for reimbursement of all travelling, hotel and other expenses reasonably incurred by a
Director for the purpose of attending meetings of the Board or otherwise in and about the business
of the Company; and
In respect of Non-Executive Directors, payment for the performance of extra services or the making
of special exertions for the benefit of the Company (at the request of and with the concurrence of
the Board).
Short-Term Benefits: The Company does not have any short-term incentive (STI) cash bonus schemes
(or equivalent) in place for Key Management Personnel.
Long-Term Benefits: The Company does not have any long-term incentive (LTI) cash bonus schemes
(or equivalent) in place for Key Management Personnel.
Equity Based Benefits: The Company does not presently have any equity (shares or options) based
remuneration arrangements for any personnel pursuant to any executive or employee share or option plan
or otherwise.
Post-Employment Benefits: The Company does not presently provide retirement benefits to Key
Management Personnel. Other than early termination benefits disclosed in ‘Employment Agreement’
below, Key Management Personnel also have no right to termination payments save for payment of
accrued unused annual and long service leave (where applicable) (these accrued employee entitlements
are not applicable in respect of Non-Executive Directors). The Company notes that shareholder approval is
required where a Company proposes to make a “termination payment” (for example, a payment in lieu of
notice, a payment for a post-employment restraint and payments made as a result of the automatic or
accelerated vesting of share based payments) in excess of one year’s “base salary” (defined as the
average base salary over the previous 3 years) to a director or any person who holds a managerial or
executive office.
Performance-Related Benefits and Financial Performance of Company: The Company does not
presently provide short- or long-term incentive/performance based benefits related to the Company’s
performance to Key Management Personnel, including payment of cash bonuses. The current
remuneration of Key Management Personnel is fixed, is not dependent on the satisfaction of a
performance condition and is unrelated to the Company’s performance.
The Board does not believe that it is appropriate at this time to implement an equity-based benefit scheme
or a performance related/variable component to Key Management Personnel remuneration or
remuneration generally linked to the Company’s performance but reserves the right to implement these
remuneration measures if appropriate in the future (subject to prior shareholder approval where
applicable).
In considering the Company's performance and its effects on shareholder wealth, Directors have had
regard to the data set out below for the latest financial year and the previous four financial years.
2019
Restated
2018
2017
2016
2015
Loss Before Income Tax ($)
(1,369,019)
(1,151,518)
(2,122,392)
(896,730)
(1,055,911)
Basic Earnings/(Loss) per Share (cents)
(3.36)
(2.80)
(5.11)
(2.35)
(2.52)
Dividends Paid ($)
VWAP Share Price on ASX for financial year (cents)
Closing Bid Share Price at 30 June (cents)
-
7
6
-
7
7
-
7
7
-
7
5
-
7
6
ANNUAL REPORT | 9
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
(2) Employment Agreement
Details of the material terms of an employment agreement entered by the Company with a Key
Management Personnel are as follows:
Key
Management
Personnel and
Position(s) Held
Victor Ho
Company
Secretary (since 30
August 2000)
Executive Director
(since 3 April
2013)
Relevant
Date(s)
Base
Salary/Fees per
annum
Other Material Terms
25 January 2000
(date of
employment
agreement)
$45,000
(but voluntarily
reduced to
$22,500)
2009/2010
(date of effect
of current
remuneration)
plus employer
superannuation
contributions
(currently 9.5%
of base salary)
• The agreement has no fixed term or fixed rolling
terms of service.
• Standard annual leave (20 days) and personal/sick
leave (10 days paid) entitlements plus entitlement to
long service leave of 60 days after 7 years of service
with an additional 5 days after each year of service
thereafter.
• One month’s notice of termination by the Company
or employee. Immediate termination without notice
if employee commits any serious act of misconduct.
The Company does not presently have formal service agreements or employment agreements with any
other Key Management Personnel.
(3) Details of Remuneration of Key Management Personnel
Details of the nature and amount of each element of remuneration of each Key Management Personnel of
the Company paid or payable by the Consolidated Entity during the financial year are as follows:
Paid by the Company (Queste) to its Key Management Personnel
2019
Performance
related
Short-term Benefits
Post-
Employment
Benefits
Other Long-
term
Benefits
Key Management
Person
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
Cash, salary
and
commissions
$
%
Non-cash
benefit
$
Superannuation
$
31,250
22,500
15,000
-
-
-
2,969
2,138
-
Long
service
leave
$
-
-
-
2018
Key
Management
Person
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Performance
related
Short-term Benefits
Post-
Employment
Benefits
Other
Long-term
Benefits
Cash, salary
and
commissions
$
31,249
22,500
%
-
-
Non-cash
benefit
$
Superannuation
$
-
-
-
2,968
2,138
-
Long
service
leave
$
-
-
-
Yaqoob Khan
-
15,000
Equity
Based
Shares &
Options
$
-
-
-
Equity Based
Shares &
Options
$
-
-
-
Total
$
34,219
24,638
15,000
Total
$
34,217
24,638
15,000
ANNUAL REPORT | 10
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
Paid by Orion to Key Management Personnel (who are also KMP of Queste)
2019
Key
Management
Personnel
Performance
related
%
Short-term Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Post-
Employment
Benefits
Other
Long-term
Benefits
Superannuation
$
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
201,250
97,500
25,000
-
-
-
19,119
9,263
-
2018
Key
Management
Personnel
Performance
related
%
Short-term Benefits
Cash, salary
and
commissions
$
Non-cash
benefit
$
Post-
Employment
Benefits
Other
Long-term
Benefits
Superannuation
$
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
-
-
-
201,249
97,499
25,000
-
-
-
19,119
9,262
-
Victor Ho is also Company Secretary of Queste and Orion.
Equity
Based
Shares &
Options
$
-
-
-
Equity
Based
Shares &
Options
$
-
-
-
Total
$
220,369
106,763
25,000
Total
$
220,368
106,761
25,000
Long
service
leave
$
-
-
-
Long
service
leave
$
-
-
-
The tables above may be aggregated to arrive at the aggregate amount of each element of remuneration
of each Key Management Personnel paid or payable by the Queste and Orion during the financial year.
(4) Other Benefits Provided to Key Management Personnel
No Key Management Personnel has during or since the end of the financial year, received or become
entitled to receive a benefit, other than a remuneration benefit as disclosed above, by reason of a contract
made by the Company or a related entity with the Director or with a firm of which he is a member, or with
a Company in which he has a substantial interest.
(5)
Engagement of Remuneration Consultants
The Company has not engaged any remuneration consultants to provide remuneration recommendations
in relation to Key Management Personnel during the year. The Board has established a policy for
engaging external Key Management Personnel remuneration consultants which includes, inter alia, that
the Non-Executive Directors on the Remuneration Committee be responsible for approving all
engagements of and executing contracts to engage remuneration consultants and for receiving
remuneration recommendations from remuneration consultants regarding Key Management Personnel.
Furthermore, the Company has a policy that remuneration advice provided by remuneration consultants be
quarantined from Management where applicable.
ANNUAL REPORT | 11
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
REMUNERATION REPORT
(6)
Shares held by Key Management Personnel
The number of ordinary shares in the Company held by Key Management Personnel is set below:
Key Management
Personnel
Executive Directors:
Farooq Khan
Victor Ho
Non-Executive Director:
Yaqoob Khan
Balance at 30
June 2018 Additions
Received as part
of remuneration
Disposals
5,344,872
17,500
68,345
-
-
-
-
-
-
-
-
-
Balance at
30 June
2019
5,344,872
17,500
68,345
Note:
The disclosures of shareholdings above are in accordance with the accounting standards which require disclosure of shares held
directly, indirectly or beneficially by each key management person, a close member of the family of that person, or an entity
over which either of these persons have, directly or indirectly, control, joint control or significant influence (as defined under
Accounting Standard AASB 124 Related Party Disclosures).
(7) Voting and Comments on the Remuneration Report at the 2018 AGM
At the Company’s most recent (2018) AGM, a resolution to adopt the prior year (2018) Remuneration
Report was put to the vote and passed on a show of hands with the proxies received also indicating
majority support in favour of adopting the Remuneration Report 11. No comments were made on the
Remuneration Report that was considered at the AGM.
This concludes the audited Remuneration Report.
11 Refer Queste’s ASX announcement dated 30 November 2018: Results of 2018 Annual General Meeting
ANNUAL REPORT | 12
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
DIRECTORS’ AND OFFICERS’ INSURANCE
The Company and Orion each insure Directors and Officers against liability they may incur in respect of any
wrongful acts or omissions made by them in such capacity (to the extent permitted by the Corporations Act 2001
(Cth)) (D&O Policy). Details of the amount of the premium paid in respect of the insurance policies are not
disclosed as such disclosure is prohibited under the terms of the contract.
DIRECTORS DEEDS
In addition to the rights of indemnity provided under the Company’s Constitution (to the extent permitted by the
Corporations Act 2001 (Cth)), the Company has also entered into a deed with each of the Directors and the
Company Secretary (Officer) to regulate certain matters between the Company and each Officer, both during
the time the Officer holds office and after the Officer ceases to be an officer of the Company, including the
following matters:
(a)
(b)
The Company’s obligation to indemnify an Officer for liabilities or legal costs incurred as an officer of the
Company (to the extent permitted by the Corporations Act 2001 (Cth)); and
Subject to the terms of the deed and the Corporations Act 2001 (Cth), the Company may advance monies
to the Officer to meet any costs or expenses of the Officer incurred in circumstances relating to the
indemnities provided under the deed and prior to the outcome of any legal proceedings brought against
the Officer.
LEGAL PROCEEDINGS ON BEHALF OF CONSOLIDATED ENTITY
No person has applied for leave of a court to bring proceedings on behalf of the Consolidated Entity or intervene
in any proceedings to which the Consolidated Entity is a party for the purpose of taking responsibility on behalf of
the Consolidated Entity for all or any part of such proceedings. The Consolidated Entity was not a party to any
such proceedings during and since the financial year.
AUDITORS
Details of the amounts paid or payable to the Auditors for audit and non-audit services (tax services) provided
during the financial year are set out below:
Auditor
Rothsay Auditing
Consolidated Entity
Non-Audit
Services
Audit &
Review
Fees
$
36,000
$
-
Total
$
Audit &
Review
Fees
$
36,000
14,000
Company
Non-Audit
Services
$
-
Total
$
14,000
The Board is satisfied that the provision of non-audit services by the auditor during the year is compatible with
the general standard of independence for auditors imposed by the Corporations Act 2001 (Cth). The Board is
satisfied that the nature of the non-audit services disclosed above did not compromise the general principles
relating to auditor independence as set out in APES 110 Code of Ethics for Professional Accountants: Professional
Independence, including reviewing or auditing the auditor’s own work, acting in a management or decision
making capacity for the Company, acting as advocate for the Company or jointly sharing economic risk and
rewards.
Rothsay Auditing continues in office in accordance with section 327B of the Corporations Act 2001 (Cth).
AUDITORS’ INDEPENDENCE DECLARATION
A copy of the Auditor’s Independence Declaration as required under section 307C of the Corporations Act 2001
(Cth) forms part of this Directors Report and is set out on page 15. This relates to the Auditor’s Independent
Review Report, where the Auditors state that they have issued an independence declaration.
ANNUAL REPORT | 13
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ REPORT
EVENTS SUBSEQUENT TO BALANCE DATE
The Directors are not aware of any other matters or circumstances at the date of this Directors’ Report, other
than those referred to in this Directors’ Report (in particular, in Review of Operations) or the financial statements
or notes thereto (in particular Note 27, that have significantly affected or may significantly affect the operations,
the results of operations or the state of affairs of the Company in subsequent financial years.
Signed for and on behalf of the Directors in accordance with a resolution of the Board.
Farooq Khan
Executive Chairman and
Managing Director
30 August 2019
Victor Ho
Executive Director and
Company Secretary
ANNUAL REPORT | 14
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF PROFIT OR LOSS AND
OTHER COMPREHENSIVE INCOME
for the year ended 30 June 2019
Revenue
Other
Net gain on sale of non-current assets
Net gain on financial assets at fair value through profit or loss
Other revenue
Total revenue
Expenses
Share of Associate entity's loss
Net loss on financial assets at fair value through profit or loss
Land operation expenses
Personnel expenses
Occupancy expenses
Corporate expenses
Finance expenses
Administration expenses
Loss from continuing operations
Loss from discontinued operations
Income tax expense
Loss after income tax
OTHER COMPREHENSIVE INCOME
Revaluation of assets, net of tax
Note
2
3
5
6
18
2019
$
56,650
201,786
-
-
258,436
Restated
2018
$
40,221
-
133,447
132
173,800
(662,455)
(87,200)
(128,704)
(477,959)
(40,141)
(55,350)
(912)
(117,974)
(1,312,259)
(530,962)
-
(10,053)
(440,899)
(36,983)
(57,653)
(3,005)
(140,389)
(1,046,144)
(56,760)
(38,973)
(1,407,992)
(105,374)
(22,233)
(1,173,751)
(61,504)
(35,086)
Total comprehensive loss for the year
(1,469,496)
(1,208,837)
Loss attributable to:
Owners of Queste Communications Ltd
Non-controlling interest
Total comprehensive loss for the year is attributable to:
Continuing operations
Discontinued operations
Owners of Queste Communications Ltd
Continuing operations
Discontinued operations
Non-controlling interest
(910,108)
(497,884)
(1,407,992)
(759,577)
(414,174)
(1,173,751)
(978,878)
(33,976)
(1,012,854)
(433,859)
(22,783)
(456,642)
(755,114)
(63,077)
(818,191)
(348,349)
(42,297)
(390,646)
(1,469,496)
(1,208,837)
Basic and diluted loss per share (cents)
attributable to the ordinary equity holders
of the Company
7
(3.36)
(2.80)
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 16
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
as at 30 June 2019
Current assets
Cash and cash equivalents
Financial assets at fair value through profit or loss
Receivables
Other current assets
Note
8
9
12
2019
$
850,739
450,003
29,720
7,138
2018
$
158,883
567,203
86,091
6,196
Total current assets
1,337,600
818,373
Non current assets
Receivables
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Deferred tax asset
Total non current assets
Total assets
Current liabilities
Payables
Provisions
Total current liabilities
Non current liabilities
Deferred tax liability
Total non current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Parent interest
Non-controlling interest
Total equity
12
13
23
14
6
15
16
6
17
18
19
23,182
1,100,000
477,718
16,458
-
22,010
1,220,000
1,242,742
1,420,221
38,973
1,617,358
3,943,946
2,954,958
4,762,319
374,852
151,482
644,566
139,417
526,334
783,983
-
-
38,973
38,973
526,334
822,956
2,428,624
3,939,363
6,239,370
5,427,285
(10,780,510)
886,145
6,239,370
6,145,896
(10,029,625)
2,355,641
1,542,479
1,583,722
2,428,624
3,939,363
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 17
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
for the year ended 30 June 2019
Issued
capital
$
Reserves
$
Accumulated
losses
$
Non-
controlling
interest
$
Total
$
Balance at 1 Jul 2017
6,149,888
3,182,215
(6,281,531)
2,088,208
5,138,780
Loss for the year
Profits reserve transfer
Other comprehensive income
Total comprehensive
loss for the year
Transactions with owners in
their capacity as owners:
Transactions with
non-controlling interest
Dividends paid
Partly-paid shares
Equal access share buy-back
-
-
-
-
-
-
106,615
(17,133)
-
2,988,517
(58,614)
2,929,903
(759,577)
(2,988,517)
-
(3,748,094)
(414,174)
-
23,528
(390,646)
(1,173,751)
-
(35,086)
(1,208,837)
90,312
(56,534)
-
-
-
-
-
-
(113,840)
-
-
-
(23,528)
(56,534)
106,615
(17,133)
Balance at 30 Jun 2018
6,239,370
6,145,896
(10,029,625)
1,583,722
3,939,363
Balance at 1 Jul 2018
6,239,370
6,145,896
(10,029,625)
1,583,722
3,939,363
Loss for the year
Profits reserve transfer
Other comprehensive income
Total comprehensive
loss for the year
Transactions with owners in
their capacity as owners:
Transactions with
non-controlling interest
-
-
-
-
-
(159,223)
(102,746)
(261,969)
(910,108)
159,223
-
(750,885)
(497,884)
-
41,242
(456,642)
(1,407,992)
-
(61,504)
(1,469,496)
-
(456,642)
-
415,399
(41,243)
Balance at 30 Jun 2019
6,239,370
5,427,285
(10,780,510)
1,542,479
2,428,624
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 18
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
CONSOLIDATED STATEMENT
OF CASH FLOWS
for the year ended 30 June 2019
Cash flows from operating activities
Receipts from customers
Dividends received
Interest received
Other income
Payments to suppliers and employees
Interest paid
Sale of financial assets at fair value through profit or loss
Purchase of financial assets at fair value through profit or loss
2019
$
212,795
108,698
12,821
-
(1,133,728)
(48)
82,844
-
2018
$
40,842
218,804
1,855
132
(396,773)
(31)
40,142
(28,000)
Net cash used in operating activities
8(a)
(716,618)
(123,029)
Cash flows from investing activities
Purchase of plant and equipment
Proceeds from disposal of agricultural assets
Commission from sale of agricultural assets
413
1,451,786
(43,500)
(4,898)
-
-
Net cash provided by/(used in) investing activities
1,408,699
(4,898)
Cash flows from financing activities
Proceeds from calls on partly paid shares
Orion dividends paid
Queste off-market share buy-back
Net cash used in financing activities
-
(225)
-
106,615
(49,570)
(5,711)
(225)
51,334
Net increase/(decrease) in cash held
691,856
(76,593)
Cash and cash equivalents at beginning of financial year
158,883
235,476
Cash and cash equivalents at end of financial year
8
850,739
158,883
The accompanying notes form part of these consolidated financial statements
ANNUAL REPORT | 19
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
1.
ABOUT THIS REPORT
1.1
Background
financial report covers
This
financial
statement of the consolidated entity consisting of Queste
Communications Ltd, its subsidiary and investment in its
associate (the Consolidated Entity or Queste). The
financial report is presented in the Australian currency.
the consolidated
Queste Communications Ltd (the Company) is a company
limited by shares, incorporated in Western Australia, Australia
and whose shares are publicly traded on the Australian
Securities Exchange (ASX).
These financial statements have been prepared on a
streamlined basis where key information is grouped together
for ease of understanding and readability. The notes include
information which is required to understand the financial
statements and is material and relevant to the operations,
financial position and performance of the Consolidated Entity.
Information is considered material and relevant if, for
example:
(a)
(b)
(c)
(d)
the amount in question is significant because of its
size or nature;
it is important for understanding the results of the
Consolidated Entity;
(e)
it helps to explain the impact of significant changes in
the Consolidated Entity’s business – for example,
acquisitions; or
it relates to an aspect of the Consolidated Entity’s
future
important
operations
performance.
that
its
to
is
The notes are organised into the following sections:
(a)
line
Key Performance: Provides a breakdown of the key
individual
of
comprehensive income that the Directors consider
most relevant to understanding performance and
shareholder returns for the year:
statement
items
the
in
Notes
2
3
4
5
6
Revenue
Expenses
Segment information
Tax
Loss per share
(b)
Financial Risk Management: Provides information
about
the Consolidated Entity’s exposure and
management of various financial risks and explains
how these affect the Consolidated Entity’s financial
position and performance:
Notes
7
8
9
10
Cash and cash equivalents
Financial assets at fair value through
profit or loss
Financial risk management
Fair value measurement of financial
instruments
(c)
Other Assets and Liabilities: Provides information
on other balance sheet assets and liabilities that do
not materially affect performance or give rise to
material financial risk:
Notes
11
12
13
14
15
16
Receivables
Property held for resale
Property, plant and equipment
Olive trees
Payables
Provisions
(d)
Capital Structure: This section outlines how the
Consolidated Entity manages its capital structure and
related financing costs, as well as capital adequacy
and reserves. It also provides details on the dividends
paid by the Company:
Notes
17
18
19
20
Issued capital
Reserves
Non-controlling interest
Dividends
Consolidated Entity Structure: Provides details
and disclosures relating to the parent entity of the
Consolidated Entity, controlled entities, investments in
associates and any acquisitions and/or disposals of
businesses in the year. Disclosure on related parties is
also provided in the section:
Notes
21
22
23
24
Parent entity information
Investment in controlled entity
Investment in associate entity
Related party transactions
(f)
Other: Provides information on items which require
disclosure to comply with Australian Accounting
Standards and other regulatory pronouncements
however,
in
understanding the financial performance or position
of the Consolidated Entity:
considered
significant
are not
Notes
25
26
27
Auditors' remuneration
Contingencies
Events occurring after the reporting
period
Significant and other accounting policies that summarise the
measurement basis used and presentation policies and are
relevant to an understanding of the financial statements are
provided throughout the notes to the financial statements.
ANNUAL REPORT | 20
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
1.2. Basis of preparation
1.6.
Impairment of Assets
These general purpose financial statements have been
prepared in accordance with Australian Accounting Standards,
the Australian
other authoritative pronouncements of
Accounting
Accounting
Board,
Interpretations and the Corporations Act 2001 (Cth), as
appropriate for for-profit entities.
Standards
Australia
Compliance with IFRS
The consolidated financial statements of the Consolidated
Entity also comply with International Financial Reporting
Standards (IFRS) as issued by the International Accounting
Standards Board (IASB).
Reporting Basis and Conventions
The financial report has been prepared on an accruals basis
and is based on historical costs modified by the revaluation of
selected non-current assets, and financial assets and financial
liabilities for which the fair value basis of accounting has been
applied.
1.3.
Principles of Consolidation
The consolidated financial statements incorporate the assets
and liabilities of the subsidiary of Queste Communications Ltd
as at 30 June 2019 and the results of its subsidiary for the
year then ended. Queste Communications Ltd and its
subsidiary are referred to in this financial statement as the
Consolidated Entity.
The controlled entity has a June financial year-end. All inter-
company balances and transactions between entities in the
Consolidated Entity, including any unrealised profits or losses,
have been eliminated on consolidation.
1.4.
Comparative Figures
Certain comparative figures have been adjusted to conform to
changes in presentation for the current financial year.
1.5. Goods and Services Tax (GST)
Revenues, expenses and assets are recognised net of the
amount of GST, except where the amount of GST incurred is
not recoverable from the Australian Tax Office. In these
circumstances the GST is recognised as part of the cost of
acquisition of the asset or as part of an item of the expense.
Receivables and payables in the Statement of Financial
Position are shown inclusive of GST. Cash flows are
presented in the Statement of Cash Flows on a gross basis,
except for the GST component of investing and financing
activities, which are disclosed as operating cash flows.
At each reporting date, the Consolidated Entity reviews the
carrying values of its tangible and intangible assets to
determine whether there is any indication that those assets
have been impaired. If such an indication exists, the
recoverable amount of the asset, being the higher of the
asset’s fair value less costs to sell and value in use, is
compared to the asset’s carrying value. Any excess of the
asset’s carrying value over
is
expensed to the profit or loss. Impairment testing is
performed annually for goodwill and intangible assets with
indefinite lives. Where it is not possible to estimate the
recoverable amount of an individual asset, the Consolidated
Entity estimates the recoverable amount of the cash-
generating unit to which the asset belongs.
its recoverable amount
1.7. Dividends Policy
Provision is made for the amount of any dividend declared;
being appropriately authorised and no longer at the discretion
of the entity, on or before the end of the financial year but
not distributed at the Balance Date.
ANNUAL REPORT | 21
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
1.8. Restatement of 2018 Comparatives
The comparative information for year ending/balance date as at 30 June 2018 has been restated to reflect the correct
presentation of the Consolidated Entity’s share of the Associate entity’s net loss and the carrying value of the Investment in the
Associate entity. The Company and its controlled entity, Orion, each holds a direct interest in the Associate entity (being
Bentley). Under the equity method of accounting for Associate entities, when the Company’s carrying value of its investment in
Bentley has been reduced from cost to nil, the Company is not required thereafter to recognise a share of Bentley’s net loss.
During the previous year ended 30 June 2018, the Consolidated Entity did recognise a share of Bentley’s net loss attributable to
the Company’s interest in Bentley, thereby increasing the Consolidated Entity’s net loss reported in the Statement of Profit or
Loss and Other Comprehensive Income and decreasing the carrying value of the investment in the Associate entity, which
impacts on the Statement of Financial Position. In the restated comparatives for 2018, there is a change to profit before tax,
other comprehensive income or earnings/(loss) per share as a result of these presentational changes.
Consolidated Statement of Profit or Loss and Other
Comprehensive Income
Revenue
Other
Net gain on sale of non-current assets
Net gain on financial assets at fair value through profit or loss
Other revenue
Total revenue
Expenses
Share of Associate entity's loss
Net loss on financial assets at fair value through profit or loss
Land operation expenses
Personnel expenses
Occupancy expenses
Corporate expenses
Finance expenses
Administration expenses
Loss from continuing operations
Loss from discontinued operations
Income tax expense
Loss after income tax
OTHER COMPREHENSIVE INCOME
Revaluation of assets, net of tax
Total comprehensive loss for the year
Loss attributable to:
Owners of Queste Communications Ltd
Non-controlling interest
Total comprehensive loss for the year is attributable to:
Continuing operations
Discontinued operations
Owners of Queste Communications Ltd
Continuing operations
Discontinued operations
Non-controlling interest
Adjustment
$
55,586
55,586
55,586
Reported
2018
$
40,221
-
133,447
132
173,800
(586,548)
-
(10,053)
(440,899)
(36,983)
(57,653)
(3,005)
(140,389)
(1,101,730)
(105,374)
(22,233)
(1,229,337)
(35,086)
(1,264,423)
(815,163)
(414,174)
(1,229,337)
(810,700)
(63,077)
(873,777)
(348,349)
(42,297)
(390,646)
(1,264,423)
Restated
2018
$
40,221
-
133,447
132
173,800
(530,962)
-
(10,053)
(440,899)
(36,983)
(57,653)
(3,005)
(140,389)
(1,046,144)
(105,374)
(22,233)
(1,173,751)
(35,086)
(1,208,837)
(759,577)
(414,174)
(1,173,751)
(755,114)
(63,077)
(818,191)
(348,349)
(42,297)
(390,646)
(1,208,837)
Basic and diluted loss per share (cents) attributable to the
ordinary equity holders of the Company
(3.00)
(2.80)
ANNUAL REPORT | 22
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
1.8
Restatement of 2018 Comparatives (continued)
Consolidated Statement of Financial Position
Current assets
Cash and cash equivalents
Financial assets at fair value through profit or loss
Receivables
Other current assets
Total current assets
Non current assets
Receivables
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Deferred tax asset
Total non current assets
Total assets
Current liabilities
Payables
Provisions
Total current liabilities
Non current liabilities
Deferred tax liability
Total non current liabilities
Total liabilities
Net assets
Equity
Issued capital
Reserves
Accumulated losses
Parent interest
Non-controlling interest
Total equity
Adjustment
$
55,586
Reported
2018
$
158,883
567,203
86,091
6,196
818,373
22,010
1,220,000
1,187,156
1,420,221
38,973
3,888,360
4,706,733
644,566
139,417
783,983
38,973
38,973
822,956
Restated
2018
$
158,883
567,203
86,091
6,196
818,373
22,010
1,220,000
1,242,742
1,420,221
38,973
3,943,946
4,762,319
644,566
139,417
783,983
38,973
38,973
822,956
3,883,777
3,939,363
6,239,370
6,145,896
6,239,370
6,145,896
(10,085,211)
2,300,055
55,586
(10,029,625)
2,355,641
1,583,722
3,883,777
1,583,722
3,939,363
ANNUAL REPORT | 23
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
1.9. Summary of Accounting Standards Issued but not yet Effective
The Consolidated Entity has adopted all of the new, revised or amending Accounting Standards and Interpretations issued by
the AASB that are mandatory for the current reporting period.
Any new, revised or amending Accounting Standards or Interpretations that are not mandatory have not been early adopted.
The following new Accounting Standards and Interpretations (which have been released but not yet adopted) have been
considered and is expected to have limited material impact on the Consolidated Entity’s financial statements or the associated
notes therein.
AASB
reference
Title and
Affected
Standard(s)
AASB 16
Leases
Nature of Change
AASB 16 requires lessees to account for all leases under a
single on-balance sheet model in a similar way to finance
leases under AASB 117 Leases. The standard includes
two recognition exemptions for lessees – leases of ’low-
value’ assets (e.g. personal computers) and short-term
leases (i.e. leases with a lease term of 12 months or
less). At the commencement date of a lease, a lessee will
recognise a liability to make lease payments (i.e. the
lease liability) and an asset representing the right to use
the underlying asset during the lease term (i.e., the right-
of-use asset).
Application date
Annual
reporting
periods beginning on
or after 1 January
2019
Lessees will be required to separately recognise the
the
interest expense on
depreciation expense on the right-of-use asset.
liability and
lease
the
Lessees will be required to re-measure the lease liability
upon the occurrence of certain events (e.g. a change in
the lease term, a change in future lease payments
resulting from a change in an index or rate used to
determine those payments). The lessee will generally
recognise the amount of the re-measurement of the lease
liability as an adjustment to the right-of-use asset.
Lessor accounting is substantially unchanged from today’s
accounting under AASB 117. Lessors will continue to
classify all leases using the same classification principle as
in AASB 117 and distinguish between two types of leases:
operating and finance leases.
ANNUAL REPORT | 24
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
2. REVENUE
The Consolidated Entity's operating loss before income tax includes the
following items of revenue:
Revenue
Rental revenue
Dividend revenue
Interest revenue
Other
Net gain on sale of non-current assets
Net gain on financial assets at fair value through profit or loss
Other revenue
2019
$
37,700
6,129
12,821
56,650
2018
$
37,700
666
1,855
40,221
201,786
-
-
258,436
-
133,447
132
173,800
Accounting policy
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Consolidated
Entity and the revenue can be reliably measured. All revenue is stated net of the amount of Goods and Services
Tax (GST) except where the amount of GST incurred is not recoverable from the Australian Tax Office. The
following specific recognition criteria must also be met before revenue is recognised:
(a) Sale of financial assets, goods and other assets
Revenue from the sale of financial assets, goods or other assets is recognised when the Consolidated Entity
has passed control of the financial assets, goods or other assets to the buyer.
(b) Interest revenue
Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the
financial assets.
(c) Dividend revenue
Dividend revenue is recognised when the right to receive a dividend has been established. The Consolidated
Entity brings dividend revenue to account on the applicable ex-dividend entitlement date
(d) Other revenues
Other revenues are recognised on a receipts basis.
3.
EXPENSES
The Consolidated Entity's operating loss before income tax includes the
following items of expenses:
Share of Associate entity's loss
Net loss on financial assets at fair value through profit or loss
Olive grove operations
Depreciation of olive grove assets
Impairment of olive trees
Other expenses
Land operations
Impairment loss on property held for development or resale
Other expenses
Salaries, fees and employee benefits
Occupancy expenses
Finance expenses
Corporate expenses
ASX fees
Share registry
Other corporate expenses
2019
$
662,455
87,200
3,566
-
53,193
120,000
8,704
477,959
40,141
912
32,406
9,297
13,647
Restated
2018
$
530,962
26,441
65,500
13,433
-
10,053
440,899
36,983
3,005
42,955
11,126
3,572
ANNUAL REPORT | 25
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
3.
EXPENSES (continued)
Administration expenses
Professional fees
Audit fees
Legal fees
Depreciation
Other administration expenses
4.
SEGMENT INFORMATION
2019
Segment revenues
Revenue
Other
Total segment revenues
Personnel expenses
Finance expenses
Administration expenses
Depreciation expenses
Other expenses
Total segment loss
Segment assets
Cash and cash equivalents
Financial assets
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Other assets
Total segment assets
2018
Segment revenues
Revenue
Other
Total segment revenues
Personnel expenses
Finance expenses
Administration expenses
Depreciation expenses
Other expenses
Total segment loss
Investments
$
43,829
-
43,829
-
-
(4,432)
-
878,017
(829,756)
Olive grove
$
-
201,786
201,786
-
-
50,863
3,566
2,065
145,292
-
-
-
-
-
-
-
-
-
-
-
450,003
1,100,000
477,718
-
-
2,027,721
40,221
133,447
173,668
-
95
530,962
-
11,802
(369,191)
2019
$
17,923
36,000
6,120
5,942
51,989
1,627,454
2018
$
21,350
36,000
1,933
5,713
75,393
1,325,318
Corporate
$
12,821
-
12,821
477,959
915
122,467
5,942
90,093
(684,555)
850,739
-
-
-
16,458
60,040
927,237
Total
$
56,650
201,786
258,436
477,959
915
168,898
9,508
970,175
(1,369,019)
850,739
450,003
1,100,000
477,718
16,458
60,040
2,954,958
-
132
132
40,221
133,579
173,800
-
101
2,732
91,950
10,590
(105,373)
440,899
2,910
93,702
5,735
133,840
(676,954)
440,899
3,106
627,396
97,685
156,232
(1,151,518)
ANNUAL REPORT | 26
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
4.
SEGMENT INFORMATION (continued)
Segment assets
Cash and cash equivalents
Financial assets
Property held for development or resale
Investment in Associate entity
Property, plant and equipment
Other assets
Total segment assets
Investments
$
-
567,203
1,220,000
1,242,742
-
-
3,029,945
Olive grove
$
62
-
-
-
907,547
492,679
1,400,288
Corporate
$
158,821
-
-
-
20,221
153,044
332,086
Total
$
158,883
567,203
1,220,000
1,242,742
927,768
645,723
4,762,319
Accounting policy
The operating segments are reported in a manner consistent with the internal reporting provided to the "Chief
Operating Decision Maker" (CODM). The Consolidated Entity's CODM is the Board of Directors who is responsible
for allocating resources and assessing performance of the operating segments.
The Board has considered the business and geographical perspectives of the operating results and determined that
the Consolidated Entity operates only within Australia, with the main segments being Investments and Olive Grove.
Corporate items are mainly comprised of corporate assets, office expenses and income tax assets and liabilities.
Description of segments
(a)
Investments comprise equity investments in companies listed on the Australian Securities Exchange (ASX),
unlisted managed funds and liquid financial assets;
(b) Olive grove is in relation to the olive grove farm in Gingin;
(c) Corporate items comprise corporate assets and operations.
Liabilities
Liabilities are not reported to the Board of Directors by segment. All liabilities are assessed at a consolidated entity
level.
5. DISCOUNTINUED OPERATIONS
On 11 October 2018, the Company completed the sale of its Olive Grove Agribusiness Assets in consideration of
$1.45 million cash. Financial information relating to the discontinued operations are as follows:
Financial
incorporated into the Income Statement is as follows:
information relating to the discontinued operation which has been
Revenue
Expenses
Loss before income tax
Income tax expense
Loss after income tax
Gain on sale of Olive Grove Agribusiness Assets
Income tax
Gain on sale of Olive Grove Agribusiness Assets after tax
Reversal of revaluation of assets, net of tax
Net gain on sale of non-current assets
2019
$
-
(56,760)
(56,760)
(38,973)
(95,733)
201,786
(38,973)
162,813
(102,746)
60,067
2018
$
-
(105,374)
(105,374)
(22,233)
(127,607)
-
-
-
-
-
ANNUAL REPORT | 27
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
5. DISCOUNTINUED OPERATIONS (continued)
The carrying amount of the assets and liabilities of the operation at the date of
cessation were:
Total assets
Total liabilities
Net liabilities
2019
$
1,403,475
(5,008,507)
(3,605,032)
2018
$
1,401,600
(4,951,201)
(3,549,601)
The net cash flows of the operations, which have been incorporated into the
Cash Flow Statement are as follows:
Net cash used in operating activities
Net cash provided by investing activities
Effect on cash flows
(9,695)
1,413,000
1,403,305
(13,423)
-
(13,423)
Details of sale of operations:
Consideration received in cash
Carrying amount of net assets sold
Gain on sale of Olive Grove Agribusiness Assets
Income tax
Reversal of revaluation of assets, net of tax
Net gain on sale of non-current assets
1,456,500
(1,396,433)
60,067
38,973
99,040
102,746
201,786
Critical accounting judgement and estimate
Judgements have been made in the determination of consideration pertaining to assets sold during the financial
year. In making these judgements, the Consolidated Entity has considered the conditions and probability of receipt
pursuant to the relevant sale agreements.
Accounting policy
A discontinued operation is a component of the Consolidated Entity’s business where the operations and cash flows
can be clearly distinguished from the rest of the Consolidated Entity and which:
represents a separate major line of business or geographical area of operations;
is part of a single coordinated plan to dispose of a separate major line of business or geographical area of
operations; or
is a subsidiary acquired exclusively with a view to re-sale.
Classification as a discontinued operation occurs at the earlier of disposal or when the operation meets the criteria
to be classified as held-for-sale. When an operation is classified as a discontinued operation, the comparative
statement of profit or loss and other comprehensive income is re-presented as if the operation had been
discontinued from the start of the comparative year.
6.
TAX
The components of tax expense comprise:
Current tax
Deferred tax
- discontinued operations
2019
$
-
38,973
38,973
2018
$
-
22,233
22,233
ANNUAL REPORT | 28
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
6.
TAX (continued)
(a)
The prima facie tax on operating loss before income tax is
reconciled to the income tax as follows:
Prima facie tax payable on operating loss before income tax at 27.5%
(2018: 27.5%)
Adjust tax effect of:
Other assessable income
Non-deductible expenses
Share of Associate entity's loss
Current year tax losses not brought to account
Prior year's deferred tax assets recognition reversal
Income tax attributable to entity
2019
$
2018
$
(376,479)
(316,667)
38,905
2,116
182,175
153,283
38,973
38,973
104,022
1,425
161,301
49,919
22,233
22,233
Deferred tax assets
Deferred tax liabilities
(b) Fair value losses
(i) Movements - deferred tax assets
Fair value losses
Opening balance
(Credited)/charged to income statement
Closing balance
(ii) Movements - deferred tax liabilities
Fair value gains
Opening balance
Charged/(Credited) to the profit and loss
Closing balance
(iii)
2019
$
-
2018
$
38,973
2019
$
-
2019
$
38,973
(38,973)
-
2018
$
38,973
2018
$
61,206
(22,233)
38,973
38,973
(38,973)
-
61,206
(22,233)
38,973
Deferred tax recognised directly in Other Comprehensive Income
Revaluations of land & intangible assets
38,973
22,233
Unrecognised deferred tax balances
Unrecognised deferred tax asset - revenue losses
Unrecognised deferred tax asset - capital losses
Unrecognised deferred tax asset - timing differences
4,805,446
254,768
1,504,086
6,564,300
4,069,081
276,732
1,516,399
5,862,212
Critical accounting judgement and estimate
The above deferred tax assets have not been recognised in respect of the above items because it is not probable
that future taxable profit will be available against which the Consolidated Entity can utilise the benefits. Revenue
and capital tax losses are subject to relevant statutory tests.
ANNUAL REPORT | 29
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
6.
TAX (continued)
Accounting policy
The income tax expense or revenue for the period is the tax payable on the current period’s taxable income based
on the notional
income tax rate for each taxing jurisdiction adjusted by changes in deferred tax assets and
liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying
amounts in the financial statements, and to unused tax losses (if applicable).
Deferred tax assets and liabilities are recognised for temporary differences at the tax rates expected to apply when
the assets are recovered or liabilities are settled, based on those tax rates which are enacted or substantively
enacted for each taxing jurisdiction. The relevant tax rates are applied to the cumulative amounts of deductible
and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain
temporary differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability
is recognised in relation to these temporary differences if they arose in a transaction, other than a business
combination, that at the time of the transaction did not affect either accounting profit or taxable profit or loss.
Deferred tax assets are recognised for deductible temporary differences and unused tax losses only if it is probable
that future taxable amounts will be available to utilise those temporary differences and losses. The amount of
deferred tax assets benefits brought to account or which may be realised in the future, is based on the assumption
that no adverse change will occur in income taxation legislation and the anticipation that the Consolidated Entity
will derive sufficient future assessable income to enable the benefit to be realised and comply with the conditions
of deductibility imposed by the law.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and
tax bases of investments in controlled entities where the Company is able to control the timing of the reversal of
the temporary differences and it is probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets
and liabilities and when the deferred tax balances relate to the same taxation authority. Current tax assets and
tax liabilities are offset where the entity has a legally enforceable right to offset and intends either to settle on a
net basis, or to realise the asset and settle the liability simultaneously.
Current and deferred tax balances attributable to amounts recognised directly in other comprehensive income or
equity are also recognised directly in other comprehensive income or equity.
7.
LOSS PER SHARE
Basic and diluted loss per share (cents)
The following represents the loss and weighted average number of shares used
in the loss per share calculations:
Loss after income tax attributable to Owners of Queste Communications Ltd ($)
Weighted average number of ordinary shares
2019
Restated
2018
(3.36)
(2.80)
(910,108)
(759,577)
Number of shares
27,072,332
27,158,058
Under AASB 133 Earnings per Share, potential ordinary shares such as partly-paid shares will only be treated as
dilutive when their conversion to ordinary shares would increase the earnings/(loss) per share. Diluted
earnings/(loss) per share is not calculated as it does not increase the earnings/(loss) per share.
ANNUAL REPORT | 30
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
7.
LOSS PER SHARE (continued)
Accounting policy
Basic earnings per share is determined by dividing the operating result after income tax by the weighted average
number of ordinary shares on issue during the financial period.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share by taking into
account amounts unpaid on ordinary shares and any reduction in earnings per share that will probably arise from
the exercise of options outstanding during the financial period.
Under AASB 133 Earnings per Share, potential ordinary shares such as partly-paid shares will only be treated as
dilutive when their conversion to ordinary shares would increase the loss per share. Diluted loss per share is not
calculated as it does not increase the loss per share.
8.
CASH AND CASH EQUIVALENTS
Cash at bank
(a)
Reconciliation of operating loss after income tax to net cash used
in operating activities
Loss after income tax
Add non-cash items:
Depreciation
Write off fixed assets
Net loss/(gain) on financial assets at fair value through profit or loss
Impairment of olive trees
Loss on land held for development or resale
Share of Associate entity's loss
Changes in assets and liabilities:
Financial assets at fair value through profit or loss
Receivables
Other current assets
Investment in Associate entity
Agricultural assets
Payables
Provisions
Deferred tax
2019
$
850,739
2018
$
158,883
(1,407,992)
(1,173,751)
9,508
2,122
93,202
-
120,000
662,455
24,000
98,699
(942)
102,569
(201,786)
(269,716)
12,290
38,973
(716,618)
32,154
-
(133,446)
65,500
-
530,962
60,604
(44,876)
376
218,138
-
293,889
5,188
22,233
(123,029)
Accounting policy
Cash and cash equivalents includes cash on hand, deposits held at call with banks, other short-term highly liquid
investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts (if any) are
shown within short-term borrowings in current liabilities on the Statement of Financial Position.
ANNUAL REPORT | 31
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
9.
FINANCIAL ASSETS AT FAIR VALUE THROUGH PROFIT OR LOSS
Listed securities at fair value
2019
$
450,003
2018
$
567,203
Accounting policy
Financial
instruments are initially measured at cost on trade date, which includes transaction costs, when the
related contractual rights or obligations exist. Subsequent to initial recognition, financial assets at fair value
through profit and loss acquired principally for the purpose of selling in the short term or if so designated by
management and within the requirements of AASB 139: Recognition and Measurement of Financial Instruments
will recognise its realised and unrealised gains and losses arising from changes in the fair value of these assets are
included in the Statement of Profit or Loss and Other Comprehensive Income in the period in which they arise.
The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading
and available-for-sale securities) is based on quoted market prices at the balance sheet date which is the current
bid price. The fair value of the unlisted managed fund is determined from unit price information provided by
investment manager. The Consolidated Entity’s investment portfolio is accounted for as a “financial assets at fair
value through profit and loss” and is carried at fair value.
10. FINANCIAL RISK MANAGEMENT
The Consolidated Entity's financial instruments consist of deposits with banks, accounts receivable and payable,
investments in listed securities, and other unlisted securities. The principal activity of the Consolidated Entity is the
management of these investments - "financial assets at fair value" (refer to Note 9). The Consolidated Entity's
investments are subject to market (which includes interest rate and price risk), credit and liquidity risks.
The Board of Directors is responsible for the overall internal control framework (which includes risk management)
but no cost-effective internal control system will preclude all errors and irregularities. The system is based, in part,
on the appointment of suitably qualified management personnel. The effectiveness of the system is continually
reviewed by management and at least annually by the Board.
The financial receivables and payables of the Consolidated Entity in the table below are due or payable within 30
days. The financial investments are held for trading and are realised at the discretion of the Board of Directors.
The Consolidated Entity holds the following financial assets and liabilities:
Cash and cash equivalents
Financial assets at fair value through profit or loss
Receivables
Payables
Net financial assets
Note
8
9
12
15
2019
$
850,739
450,003
29,720
1,330,462
(374,852)
955,610
2018
$
158,883
567,203
86,091
812,177
(644,566)
167,611
ANNUAL REPORT | 32
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
10. FINANCIAL RISK MANAGEMENT (continued)
(a) Market risk
Market risk is the risk that the fair value and/or future cash flows from a financial instrument will fluctuate as
a result of changes in market factors. Market risk comprises of price risk from fluctuations in the fair value of
equities and interest rate risk from fluctuations in market interest rates.
(i) Price risk
The Consolidated Entity is exposed to equity securities price risk. This arises from investments held by
the Consolidated Entity and classified in the Statement of Financial Position at fair value through profit or
loss. The Consolidated Entity is not exposed to commodity price risk, save where this has an indirect
impact via market risk and equity securities price risk.
The value of a financial instrument will fluctuate as a result of changes in market prices, whether those
changes are caused by factors specific to the individual instrument or its issuer or factors affecting all
instruments in the market. By its nature as an investment company, the Consolidated Entity will always
be subject to market risk as it invests its capital in securities that are not risk free - the market price of
these securities can and will fluctuate. The Consolidated Entity does not manage this risk through
entering into derivative contracts, futures, options or swaps.
Equity price risk is minimised through ensuring that investment activities are undertaken in accordance
with Board established mandate limits and investment strategies.
The Consolidated Entity has performed a sensitivity analysis on its exposure to market price risk at
balance date. The analysis demonstrates the effect on the current year results and equity which could
result from a change in these risks. The ASX All Ordinaries Accumulation Index was utilised as the
benchmark for the unlisted and listed share investments which are financial assets available-for-sale or at
fair value through profit or loss.
ASX All Ordinaries
Accumulation Index
Increase 15%
Decrease 15%
(ii) Interest rate risk
Impact on
post-tax profit
Impact on other
components of equity
2019
$
17,425
(17,425)
2018
$
22,546
(22,546)
2019
$
17,425
(17,425)
2018
$
22,546
(22,546)
Interest rate risk is the risk that the value of a financial
instrument will fluctuate due to changes in
market interest rates. The Consolidated Entity's exposure to market risk for changes in interest rates
relate primarily to investments held in interest bearing instruments. The average interest rate for the
year for the table below is 1.1% (2018: 1.35%). The revenue exposure is immaterial
in terms of the
possible impact on profit or loss or total equity.
Cash at bank and in hand
2019
$
850,739
2018
$
158,883
ANNUAL REPORT | 33
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
10. FINANCIAL RISK MANAGEMENT (continued)
(b) Credit risk
Credit risk refers to the risk that a counterparty under a financial instrument will default (in whole or in part)
on its contractual obligations resulting in financial loss to the Consolidated Entity. Credit risk arises from cash
and cash equivalents and deposits with banks and financial institutions, including outstanding receivables and
committed transactions. Concentrations of credit risk are minimised primarily by undertaking appropriate due
diligence on potential
investments, carrying out all market transactions through approved brokers, settling
non-market transactions with the involvement of suitably qualified legal and accounting personnel (both
internal and external), and obtaining sufficient collateral or other security (where appropriate) as a means of
loss from defaults. The Consolidated Entity's business activities do not
mitigating the risk of financial
necessitate the requirement for collateral as a means of mitigating the risk of financial loss from defaults.
The credit quality of the financial assets are neither past due nor impaired and can be assessed by reference
to external credit ratings (if available with Standard & Poor's) or to historical information about counterparty
default rates. The maximum exposure to credit risk at reporting date is the carrying amount of the financial
assets as summarised below:
Cash and cash equivalents
AA-
Receivables (due within 30 days)
No external credit rating available
2019
$
849,585
2018
$
158,729
29,720
86,091
The Consolidated Entity measures credit risk on a fair value basis. The carrying amount of financial assets
recorded in the financial statements, net any provision for losses, represents the Consolidated Entity's
maximum exposure to credit risk.
(c) Liquidity risk
Liquidity risk is the risk that the Consolidated Entity will encounter difficulty in meeting obligations associated
liabilities. The Consolidated Entity has no borrowings. The Consolidated Entity's non-cash
with financial
investments can be realised to meet trade and other payables arising in the normal course of business. The
financial liabilities disclosed in the above table have a maturity obligation of not more than 30 days.
11. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS
Fair value hierarchy
AASB 13 (Fair Value Measurement) requires disclosure of fair value measurements by level of the following fair
value measurement hierarchy:
(i)
(ii)
Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities;
Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (as prices) or indirectly (derived from prices); and
Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
(iii)
2019
Financial assets at fair value through profit or loss:
Listed securities at fair value
Total
Level 1
$
Level 2
$
Level 3
$
Total
$
450,003
450,003
-
-
-
-
450,003
450,003
ANNUAL REPORT | 34
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
11. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued)
2018
Financial assets at fair value through profit or loss:
Level 1
$
Level 2
$
Level 3
$
Total
$
Listed securities at fair value
Land at independent valuation
Total
567,203
-
567,203
-
-
-
-
1,259,608
1,259,608
567,203
1,259,608
1,826,811
There have been no transfers between the levels of the fair value hierarchy during the financial year.
(a) Valuation techniques
The fair value of the listed securities traded in active markets is based on closing bid prices at the end of the
reporting period. These investments are included in Level 1.
The fair value of any assets that are not traded in an active market are determined using certain valuation
techniques. The valuation techniques maximise the use of observable market data where it is available, or
independent valuation and rely as little as possible on entity specific estimates. If all significant inputs
required to fair value an instrument are observable, the instrument is included in Level 2. If one or more of
the significant inputs is not based on observable market data, the instrument is included in Level 3.
At Level 3, the land was valued by an independent qualified valuer (a Certified Practising Valuer and Associate
Member of the Australian Property Institute) as at 15 June 2017 was sold (Note 5). These assets have been
valued based on similar assets, location and market conditions or Direct Comparison or Comparative Sales
Approach. The land value per hectare based on rural land sold in the general location provided a rate which
included ground water licence.
(b) Level 3 assets
At 1 Jul 2017
Revaluation/(Impairment)
At 30 Jun 2018
Disposal
At 30 Jun 2019
(c) Fair values of other financial assets and liabilities
Cash and cash equivalents
Receivables
Payables
Land
$
1,340,455
(80,847)
1,259,608
(1,259,608)
-
Olive trees
$
65,500
(65,500)
-
-
-
2019
$
850,739
29,720
880,459
(374,852)
505,607
Total
$
1,405,955
(146,347)
1,259,608
(1,259,608)
-
2018
$
158,883
86,091
244,974
(644,566)
(399,592)
Due to their short-term nature, the carrying amounts of cash, current receivables and current payables is
assumed to approximate their fair value.
ANNUAL REPORT | 35
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
11. FAIR VALUE MEASUREMENT OF FINANCIAL INSTRUMENTS (continued)
Accounting policy
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for
disclosure purposes. The fair value of financial
instruments traded in active markets (such as publicly traded
derivatives, and trading and available-for-sale securities) is based on quoted market prices at the Balance Date.
The quoted market price used for financial assets held by the Consolidated Entity is the current bid price; the
appropriate quoted market price for financial liabilities is the current ask price.
The fair value of financial
instruments that are not traded in an active market (for example over-the-counter
derivatives) is determined using valuation techniques, including but not limited to recent arm’s length transactions,
reference to similar instruments and option pricing models. The Consolidated Entity may use a variety of methods
and makes assumptions that are based on market conditions existing at each Balance Date. Other techniques,
such as estimated discounted cash flows, are used to determine fair value for other financial instruments.
trade receivables and payables are assumed to
The nominal value less estimated credit adjustments of
approximate their fair values. The fair value of financial
liabilities for disclosure purposes is estimated by
discounting the future contractual cash flows at the current market interest rate that is available to the
Consolidated Entity for similar financial instruments.
The Consolidated Entity’s investment portfolio (comprising listed and unlisted securities) is accounted for as
“financial assets at fair value through profit and loss” and is carried at fair value based on the quoted last bid
prices at the reporting date (refer Note 8).
12. RECEIVABLES
Current
Deposit
GST receivable
Other receivables
Non current
Bonds and guarantees
2019
$
27,500
-
2,220
29,720
2018
$
27,500
5,747
52,844
86,091
23,182
22,010
Risk exposure
The Consolidated Entity’s exposure to credit and interest rate risks is discussed in Note 9.
Impaired trade receivables
None of the Consolidated Entity's receivables are impaired or past due.
Accounting policy
AASB 9: Financial Instruments introduces a new expected credit loss (ECL) impairment model that requires the
Consolidated Entity to adopt an ECL position across the Consolidated Entity’s financial assets at 1 July 2018. The
Consolidated Entity’s receivables balance comprises deposits and GST refunds from the Australian Tax Office.
At each reporting date, the Consolidated Entity reviews the carrying value of its financial assets based on the ECL
model under AASB 9, which proposes three approaches in assessing impairment:
(i)
the simplified approach (which will be applied to most trade receivables) which requires the recognition of
lifetime ECLs by considering forward-looking assumptions and information regarding expected future conditions
affecting historical customer default rates;
ANNUAL REPORT | 36
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
12. RECEIVABLES (continued)
Accounting policy (continued)
(ii) the general approach (which will be applied to most loans and debt securities) whereby ECL is recognised in
two stages. For credit exposures for which there has not been a significant increase in credit risk since initial
recognition, the Consolidated Entity will provide for credit losses that result from default events that are possible
within the next 12 months. For those credit exposures for which there has been a significant increase in credit risk
since initial recognition, a loss allowance will arise for credit losses expected over the remaining life of exposure,
irrespective of the timing of the default; and
(iii) For purchased or originated credit-impaired receivables, the fair value at initial recognition already takes into
account lifetime expected losses. At each reporting date, the Consolidated Entity updates its estimated cash flows
and adjusts the loss allowance accordingly.
The loss allowances for financial assets are based on the assumptions about risk of default and expected loss
rates. The Consolidated Entity uses judgement in making these assumptions and selecting the inputs to the
impairment calculation, based on the Consolidated Entity’s past history, existing market conditions as well as
forward looking estimates at the end of each reporting period. The Consolidated Entity has not recognised any
additional impairment to its current receivables or non-current receivables as a result of the application of AASB 9.
This is due to the fact that the Consolidated Entity does not consider that there are any further ECL to the current
carrying values of its current receivables or its non-current receivables.
13. PROPERTY HELD FOR RESALE
Property held for development or resale
Revaluation of property
2019
$
3,797,339
(2,697,339)
1,100,000
2018
$
3,797,339
(2,577,339)
1,220,000
Critical accounting judgement and estimate
Property held for development or resale was last valued by an independent qualified valuer (a Certified Practising
Valuer and Associate Member of the Australian Property Institute) as at 30 June 2019. The revaluation impairment
of $120,000 has been recognised in the Statement of Profit or Loss and Other Comprehensive Income.
Accounting policy
Property held for resale is valued at the lower of cost and net realisable value. Cost includes the cost of
acquisition, development, borrowing costs and holding costs until completion of development. Finance costs and
holding charges incurred after development are expensed. Profits are brought to account on the signing of an
unconditional contract of sale.
14. PROPERTY, PLANT AND EQUIPMENT
Accumulated
Total
2019
Plant and equipment
2018
Freehold land
Buildings
Plant and equipment
Cost
$
102,951
102,951
Additions Depreciation
$
$
3,267
3,267
(89,760)
(89,760)
$
16,458
16,458
1,117,889
124,867
1,393,490
2,636,246
141,719
-
-
141,719
-
(70,211)
(1,287,533)
(1,357,744)
1,259,608
54,656
105,957
1,420,221
ANNUAL REPORT | 37
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
14. PROPERTY, PLANT AND EQUIPMENT (continued)
Movements in carrying amounts
At 1 July 2017
Revaluation
Additions
Depreciation expense
At 30 June 2018
At 1 July 2018
Additions
Disposals
Depreciation expense
At 30 June 2019
Freehold land
$
1,340,455
(80,847)
-
-
1,259,608
1,259,608
-
(1,259,608)
-
-
Buildings
$
59,088
-
-
(4,432)
54,656
54,656
-
(53,973)
(683)
-
Plant and
equipment
$
128,781
-
4,898
(27,722)
Total
$
1,528,324
(80,847)
4,898
(32,154)
105,957
1,420,221
105,957
4,301
(84,975)
(8,825)
16,458
1,420,221
4,301
(1,398,556)
(9,508)
16,458
Critical accounting judgement and estimate
In assessing the recoverable amount of
the Consolidated Entity's farm property, plant and equipment,
management monitors the worldwide olive oil prices annually in determining if the Gingin olives should be
harvested. As such the property, plant and equipment is carried at its written down value and continues to be
depreciated as it is in a condition to be used to generate economic benefits to the Consolidated Entity at such time
as required and the assets are maintained in fair condition and therefore their recoverable amount has been
assessed to be in excess of their carrying values at reporting date.
Accounting policy
All plant and equipment are stated at historical cost less accumulated depreciation and impairment losses.
Historical cost includes expenditure that is directly attributable to the acquisition of the items.
Freehold land is not depreciated. Increases in the carrying amounts arising on revaluation of land are recognised,
net of tax, in other comprehensive income and accumulated in reserves in equity. To the extent that the increase
reverses a decrease previously recognised in profit or loss, the increase is first recognised in profit or loss.
Decreases that reverse previous increases of the same asset are first recognised in other comprehensive income to
the extent of the remaining surplus attributable to the asset; all other decreases are charged to profit or loss. It is
shown at fair value, based on periodic valuations by external, independent valuers.
The carrying amount of plant and equipment is reviewed annually by Directors to ensure it is not in excess of the
recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash
flows that will be received from the asset’s employment and subsequent disposal. The expected net cash flows
have been discounted to their present value in determining the recoverable amount.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
only when it is probable that future economic benefits associated with the item will flow to the Consolidated Entity
and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the
Statement of Profit or Loss and Other Comprehensive Income during the financial period in which they are
incurred.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each Balance Date. An
asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is
greater than its estimated recoverable amount.
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in
the profit or loss. When revalued assets are sold, amounts included in the revaluation reserve relating to that
asset are transferred to retained earnings.
Class of Fixed Asset
Buildings
Plant and Equipment
Rate
7.50%
5-75%
Method
Diminishing Value
Diminishing Value
ANNUAL REPORT | 38
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
15. PAYABLES
Current
Trade payables
Dividend payable
GST payable
Other payables and accrued expenses
Directors' fees and entitlements
2019
$
17,749
6,739
13,827
40,097
296,440
374,852
2018
$
15,586
-
14,716
223,607
390,657
644,566
Risk exposure
The Consolidated Entity’s exposure to risks arising from current payables is set out in Note 10.
Accounting policy
These amounts represent liabilities for goods and services provided to the Consolidated Entity prior to the end of
the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.
16. PROVISIONS
Current
Employee benefits - annual leave
Employee benefits - long service leave
2019
$
2018
$
36,191
115,291
151,482
14,457
124,960
139,417
(a) Amounts not expected to be settled within 12 months
The provision for annual leave and long service leave is presented as current since the Consolidated Entity
does not have an unconditional right to defer settlement for any of these employee benefits. Long service
leave covers all unconditional entitlements where employees have completed the required period of service
and also where employees are entitled to pro-rata payments in certain circumstances.
Based on past experience, the employees have never taken the full amount of long service leave or require
payment within the next 12 months. The following amounts reflect leave that is not expected to be taken or
paid within the next 12 months:
Leave obligations expected to be settled after 12 months
2019
$
115,291
2018
$
124,960
Accounting policy
Short-term obligations
Provision is made for the Consolidated Entity’s liability for employee benefits arising from services rendered by
employees to the Balance Date. Employee benefits that are expected to be settled within one year have been
measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee
benefits payable later than one year from the Balance Date have been measured at the present value of the
estimated future cash outflows to be made for those benefits. Employer superannuation contributions are made
by the Consolidated Entity in accordance with statutory obligations and are charged as an expense when incurred.
Other long-term employee benefit obligations
The liability for long-service leave is recognised in the provision for employee benefits and measured as the
present value of expected future payments to be made in respect of services provided by employees up to the
reporting date. Consideration is given to expected future wage and salary levels, experience of employee
departures and periods of service.
ANNUAL REPORT | 39
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
17. ISSUED CAPITAL
Fully paid ordinary shares
2019
Number
27,072,332
2018
Number
27,072,332
2019
$
6,239,370
2018
$
6,239,370
Movement in fully paid ordinary shares
At 1 Jul 2017
Issue of shares
Equal access share buy-back - refer (b)
Partly-paid shares cancelled
At 30 Jun 2018
Movement in partly-paid ordinary shares
At 1 Jul 2017
Call on partly-paid shares - refer (b)
Partly-paid shares cancelled
Equal access share buy-back - refer (b)
Partly-paid shares cancelled
At 30 Jun 2018
Date of issue
19-Oct-17
Issue price
$
0.20
0.20
Number
of shares
26,578,358
577,000
(83,026)
-
27,072,332
5,770,000
(577,000)
(5,193,000)
-
$
5,935,679
115,400
(4,151)
192,442
6,239,370
214,209
106,615
(115,400)
(12,982)
(192,442)
-
There was no movement in the Company's issued capital during the financial year.
(a) Call on partly-paid ordinary shares
On 19 October 2017 there was a conversion of 577,000 partly-paid shares respectively into fully paid shares
upon payment of a call made by the Company in relation to 100% of the outstanding balance (being
$0.184775 each or $106,615 in total) due and payable in respect of these 577,000 partly-paid shares.
(b) Equal access share buy-back
On 5 January 2018, the Company's Off-Market Equal Access Share Buy-Back (approved by shareholders at the
Annual General Meeting held on 30 November 2017) (Buy-Back) closed with the following shares being
bought-back and cancelled:
83,026 fully paid ordinary shares were bought back for 5 cents per share at a cost of $4,151; and
(i)
(ii) 5,193,000 partly-paid ordinary shares were bought back for 0.25 cent per share at a total cost of $12,983,
with the total cost of the Buy-Back being $17,134.
The Buy-Back consideration was satisfied as follows:
(i)
Cash Component: One-third (by value) of an accepting shareholder’s Buy-Back consideration was
satisfied by Queste paying cash; and
Scrip Component: Two-thirds (by value) of an accepting shareholder’s Buy-Back consideration was
satisfied by Queste distributing shares in Bentley Capital Limited (ASX:BEL) based on a deemed value of
15.3846 cents per BEL share (rounded to the nearest whole share in BEL).
(ii)
(c) Capital risk management
The Company's objectives when managing its capital are to safeguard its ability to continue as a going
concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders and to
maintain a capital structure balancing the interests of all shareholders.
The Board will consider capital management initiatives as is appropriate and in the best interests of the
Company and shareholders from time to time, including undertaking capital raisings, share Buy-backs, capital
reductions and the payment of dividends.
The Consolidated Entity has no external borrowings. The Consolidated Entity's non-cash investments can be
realised to meet accounts payable arising in the normal course of business.
ANNUAL REPORT | 40
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
17. ISSUED CAPITAL (continued)
Accounting policy
Ordinary shares are classified as equity. Fully paid ordinary shares carry one vote per share and the right to
dividends. At any meeting, each shareholder present in person or by proxy, attorney, or representative has one
vote for each fully paid ordinary share held either upon a show of hands or by a poll. Holders of partly-paid
ordinary shares have a fraction of a vote for each partly-paid share held, with the fractional vote of each share
being equivalent to the proportion of the total amount paid and payable (excluding amounts credited) that has
actually been paid (not credited) for each share. Amounts paid in advance of a call are ignored when calculating
proportions. The holder of a partly-paid ordinary share is not entitled to vote at a meeting in respect of those
shares on which calls are outstanding.
The profits of the Consolidated Entity, which the Directors may from time to time determine to distribute to
shareholders by way of dividends, will be divisible amongst the shareholders in proportion to the amounts paid on
the shares. An amount paid in advance of a call
is not to be included as an amount paid on a share for the
purposes of calculating an entitlement to dividends.
Incremental costs directly attributable to the issue of new shares or options are shown in equity as a deduction,
net of tax, from the proceeds. Incremental costs directly attributable to the issue of new shares or options for the
acquisition of a business, are included in the cost of the acquisition as part of the purchase consideration.
18. RESERVES
Profits reserve
Option premium reserve
Asset revaluation reserve
Revaluations of freehold land
Deferred tax on revaluations
Non-controlling interest
Other reserve
Dilution movement
Non-controlling interest
2019
$
2,918,053
2,138,012
2018
$
3,077,276
2,138,012
-
-
-
-
141,719
(38,973)
(41,242)
61,504
1,071,663
(700,443)
371,220
1,071,663
(202,559)
869,104
Total reserves
5,427,285
6,145,896
Movements in Profits reserve
Opening balance
Profits reserve transfer
OEQ Dividends paid to non-controlling interest (Note 20)
Closing balance
Movements in Asset revaluation reserve
Opening balance
Revaluations of freehold land
Disposal of freehold land
Deferred tax on revaluations
Non-controlling interest
Closing balance
3,077,276
(159,223)
-
145,293
2,988,517
(56,534)
2,918,053
3,077,276
61,504
-
(141,719)
38,973
41,242
-
96,590
(80,847)
-
22,233
23,528
61,504
ANNUAL REPORT | 41
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
18. RESERVES (continued)
The Asset Revaluation Reserve relates to the revaluation of Orion's Olive Grove Land which has been sold (Note 5).
Other Reserve relates the differences which may arise as a result of transactions with non-controlling interests that
do not result in a loss of control.
Profits Reserve increase will arise when the Company or its subsidiaries generates a net profit (after tax) for a
relevant financial period (i.e. half year or full year) which the Board determines to credit to the company’s Profits
Reserve. Dividends may be paid out of (and debited from) the Company’s Profits Reserve, from time to time.
19. NON-CONTROLLING INTEREST
Issued capital
Asset revaluation reserve
Other reserve
Accumulated losses
2019
$
7,549,512
-
700,443
(6,707,476)
1,542,479
Restated
2018
$
7,549,512
41,242
202,559
(6,209,591)
1,583,722
The non-controlling interest is a 40.14% (2018: 40.14%) equity holding in Orion Equities Limited (not held by the
Company).
Accounting policy
The Consolidated Entity treats transactions with non-controlling interests that do not result in a loss of control as
transactions with equity owners of the Consolidated Entity. A change in ownership interest results in an adjustment
between the carrying amounts of the controlling and non-controlling interests to reflect their relative interests in
the subsidiary. Any difference between the amount of the adjustment to non-controlling interests and any
consideration paid or received is recognised in a separate reserve (refer to Note 18) within equity attributable to
owners of Queste Communications Ltd.
20. DIVIDENDS
Dividends paid in cash during the financial year:
by OEQ - 0.90 cent per share fully franked dividend
Paid On
29-Sep-17
2019
$
2018
$
-
140,843
OEQ Franking credits available for subsequent periods based
on a tax rate of 27.5%
3,093,275
3,030,179
The above amounts represent the balance of the franking account as at the end of the reporting period, adjusted
for:
(a) Franking credits that will arise from the receipt of dividends recognised as receivables at balance date;
(b) Franking credits that will arise from the payment of the amount of the provision for income tax; and
(c) Franking debits that will arise from the payment of dividends recognised as a liability at balance date.
The franking credits attributable to the Consolidated Entity include franking credits that would be available to the
parent entity if distributable profits of subsidiaries were paid as dividends.
ANNUAL REPORT | 42
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
21. PARENT ENTITY INFORMATION
The following information provided relates to the Company, Queste Communications Ltd, as at 30 June 2019.
Statement of profit or loss and other
comprehensive income
Profit/(Loss) for the year
Other comprehensive income
Total comprehensive loss for the year
Statement of financial position
Current assets
Non current assets
Total assets
Current liabilities
Total liabilities
Net assets
Issued capital
Option premium reserve
Accumulated losses
Equity
2019
$
(550,187)
Reported
2018
$
57,220
Adjustment
(14,731)
(550,187)
57,220
$
58,693
1,681,924
1,740,617
138,411
2,211,749
2,350,160
227,656
227,656
202,789
202,789
1,512,961
2,147,371
6,239,370
2,347,229
(7,073,638)
1,512,961
6,239,370
2,347,229
(6,439,229)
2,147,371
(84,223)
(84,223)
Restated
2018
$
42,489
-
42,489
$
138,411
2,127,526
2,265,937
202,789
202,789
2,063,148
6,239,370
2,347,229
(6,523,452)
2,063,148
The restatement relates to the accounting of the Company's investment in an Associate entity under the equity
method. Where the Company has recognised a share of the Associate entity's losses such that the carrying value
has been reduced to nil, the Company is not required to recognise any further share of the Associate entity's losses
- in 2018, the Company recognised an excessive share of the Associate entity's losses such that the carrying value
was reduced to below nil. There was also a restatement in Non-Current Assets in relation to the elimination of the
Company's market value of its investment in the Associate entity.
22. INVESTMENT IN CONTROLLED ENTITY
The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiary with
non-controlling interest:
Ownership Interest
Orion Equities Limited
Incorporated
Australia
Parent
2019
59.86%
Non-Controlling Interest
2018
59.86%
2019
40.14%
2018
40.14%
Summarised financial
information of
consolidated entity are set out below:
the subsidiary with non-controlling interests that are material
to the
Summarised statement of profit or loss and other comprehensive
income
Revenue
Expenses
Loss from continuing operations
Loss from discontinued operations
Income tax expense
Loss after income tax expense
Other comprehensive income
Total comprehensive loss for the year
2019
$
250,758
(1,434,372)
(1,183,614)
(56,760)
(38,973)
(1,279,347)
(102,746)
(1,382,093)
2018
$
169,379
(1,099,137)
(929,758)
(105,374)
(22,233)
(1,057,365)
(58,614)
(1,115,979)
ANNUAL REPORT | 43
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
22. INVESTMENT IN CONTROLLED ENTITY (continued)
Summarised Statement of Financial Position
Current assets
Non-current assets
Total Assets
Current liabilities
Non-current liabilities
Total Liabilities
Net Assets
Statement of cash flows
Net cash from operating activities
Net cash used in investing activities
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents
Other financial information
Profit/(Loss) attributable to non-controlling interest
Accumulated non-controlling interest at the end of the year
2019
$
1,278,904
1,583,190
2,862,094
222,491
76,187
298,678
2018
$
658,580
3,907,099
4,565,679
581,197
38,973
620,170
2,563,416
3,945,509
(629,769)
1,408,286
(225)
778,292
(36,603)
(1,446)
(133,879)
(171,928)
(497,884)
1,542,479
(414,174)
1,583,722
Accounting policy
Subsidiaries are all entities (including structured entities) over which the Consolidated Entity has control. The
Consolidated Entity 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 to direct the activities of the entity.
Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated Entity. They
are deconsolidated from the date that control ceases.
Subsidiaries are fully consolidated from the date on which control is transferred to the Consolidated Entity. They
are de-consolidated from the date that control ceases. The controlled entity has a June financial year-end. All inter-
company balances and transactions between entities in the Consolidated Entity, including any unrealised profits or
losses, have been eliminated on consolidation.
Changes in Ownership Interests
When the Consolidated Entity ceases to have control, any retained interest in the entity is re-measured to its fair
value with the change in carrying amount recognised in profit or loss. The fair value becomes the initial carrying
amount for the purposes of subsequently accounting for the retained interest as an associate or financial asset. In
addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted
for as if the Consolidated Entity has directly disposed of the related assets or liabilities. This may mean that
amounts previously recognised in other comprehensive income are reclassified to profit or loss.
23. INVESTMENT IN ASSOCIATE ENTITY
Carrying Amount
Bentley Capital Limited (ASX:BEL)
Ownership Interest
2019
28.56%
2018
28.56%
Movements in carrying amounts
Opening balance
Share of net loss after tax
Reversal of QUE over-recognition of share of net loss
Dividends received
Disposal of shares through Equal access share buy-back
Closing balance
2019
$
477,718
1,242,742
(662,455)
-
(102,569)
-
477,718
Restated
2018
$
1,242,742
2,003,264
(586,548)
55,586
(218,138)
(11,422)
1,242,742
ANNUAL REPORT | 44
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
23. INVESTMENT IN ASSOCIATE ENTITY (continued)
Fair value (at market price on ASX) of investment in Associate entity
2019
$
1,630,465
2018
$
2,065,256
Net asset backing value of investment in Associate entity
1,813,602
2,669,174
Summarised statement of profit or loss and other comprehensive income
Revenue
Expenses
Loss before income tax
Income tax expense
Loss after income tax
Other comprehensive income
Total comprehensive income
296,380
(2,754,789)
(2,458,409)
1,291,720
(3,135,545)
(1,843,825)
-
-
(2,458,409)
(1,843,825)
-
-
(2,458,409)
(1,843,825)
Summarised statement of financial position
Current assets
Non-current assets
Total assets
Current liabilities
Non-current liabilities
Total liabilities
Net assets
6,694,371
22,364
6,716,735
7,092,182
2,593,165
9,685,347
363,900
1,929
365,829
323,579
14,805
338,384
6,350,906
9,346,963
Accounting policy
Associates are all entities over which the Consolidated Entity has presumed significant influence but not control or
joint control, generally accompanying a shareholding of between approximately 20% and 50% of the voting rights.
Investments in Associates in the consolidated financial statements are accounted for using the equity method of
accounting. On initial recognition investment in associates are recognised at cost, for investments which were
classified as fair value through profit or loss, any gains or losses previously recognised are reversed through profit
or loss. Under this method, the Consolidated Entity’s share of the post-acquisition profits or losses of Associates
are recognised in the consolidated Statement of Profit or Loss and Other Comprehensive Income, and its share of
post-acquisition movements in reserves is recognised in Other Comprehensive Income. The cumulative post-
acquisition movements are adjusted against the carrying amount of the investment.
A share of an Associate entity's net gain increases the investment (and a share of net loss decreases the
investment) and dividend income received from an Associate entity decreases the investment. When the
Consolidated Entity’s share of losses in an Associate equals or exceeds its interest in the Associate, including any
other unsecured long-term receivables, the Consolidated Entity does not recognise further losses, unless it has
incurred obligations or made payments on behalf of the Associate.
Where applicable, unrealised gains on transactions between the Consolidated Entity and its Associates are
eliminated to the extent of the Consolidated Entity’s interest in the Associates. Unrealised losses are also
eliminated unless the transaction provides evidence of an impairment of the asset transferred. The accounting
policies of Associates are aligned to ensure consistency with the policies adopted by the Consolidated Entity, where
practicable.
ANNUAL REPORT | 45
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
24. RELATED PARTY TRANSACTIONS
The Company has control of Orion Equities Limited (ASX:OEQ) (Orion) as it holds 59.86% (9,367,653 shares) of
Orion's issued capital (2018: 59.86% and 9,367,653 shares). During the year there were transactions between the
Company, Orion and Associate Entity, Bentley Capital Limited (ASX:BEL), pursuant
to shared office and
administration expense arrangements. There were no outstanding amounts at the reporting date.
Bentley Capital Limited
Dividends Received
(a) Transactions with key management personnel
2019
$
108,698
2018
$
109,069
Refer to the Remuneration Report contained in the Directors' Report for details of the remuneration paid or
payable to each member of the Consolidated Entity's KMP for the year ended 30 June 2019. The total
remuneration paid to KMP of the Consolidated Entity during the year is as follows:
Directors
Short-term employment benefits
Post-employment benefits
2019
$
392,500
33,488
425,988
2018
$
392,497
33,488
425,985
During the year, the Consolidated Entity generated $37,700 rental
income from a KMP/close family member of
KMP (the KMP being Queste and Orion Director, Farooq Khan), pursuant to a standard form residential tenancy
agreement in respect of Property Held for Resale (held by Orion subsidiary, Silver Sands Developments Pty Ltd)
(2018: $37,700).
25. AUDITORS' REMUNERATION
During the year the following fees were paid for services provided by the auditor of the parent entity:
Rothsay Auditing
Audit and Review of Financial Statements
26.
CONTINGENCIES
2019
$
36,000
2018
$
36,000
(a)
Directors' Deeds
The Company has entered into Deeds of Indemnity with each of its Directors indemnifying them against
liability incurred in discharging their duties as Directors/Officers of the Consolidated Entity. At the end of the
financial period, no claims have been made under any such indemnities and accordingly, it is not possible to
quantify the potential financial obligation of the Consolidated Entity under these indemnities.
(b) Tenement Royalties
The Consolidated Entity is entitled to receive a royalty of 2% of gross revenues (exclusive of GST) from any
commercial exploitation of any minerals from the Paulsens East (Iron Ore) Project tenement (currently a
Retention Licence RL 47/7) in Western Australia currently held by Strike Resources Limited (ASX:SRK).
ANNUAL REPORT | 46
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
for the year ended 30 June 2019
27. EVENTS OCCURRING AFTER THE REPORTING PERIOD
No other matter or circumstance has arisen since the end of the financial year that significantly affected, or may
significantly affect, the operations of the Consolidated Entity, the results of those operations, or the state of affairs
of the Consolidated Entity in future financial years.
ANNUAL REPORT | 47
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
DIRECTORS’ DECLARATION
The Directors of the Company declare that:
(1)
(2)
(3)
(4)
The financial statements, Consolidated Statement of Profit or Loss and Other Comprehensive Income,
Consolidated Statement of Financial Position, Consolidated Statement of Cash Flows, Consolidated
Statement of Changes in Equity, and accompanying notes as set out on pages 16 to 47 are in accordance
with the Corporations Act 2001 (Cth) and:
(a)
(b)
comply with Australian Accounting Standards, the Corporations Regulations 2001 and other
mandatory professional reporting; and
give a true and fair view of the Consolidated Entity’s financial position as at 30 June 2019 and of its
performance for the year ended on that date;
In the Directors’ opinion there are reasonable grounds to believe that the Company will be able to pay its
debts as and when they become due and payable;
The Directors have been given the declarations required by section 295A of the Corporations Act 2001
(Cth) by the Executive Chairman/Managing Director (the person who, in the opinion of the Directors,
performs the Chief Executive Officer function) and Company Secretary (the person who, in the opinion of
the Directors, performs the Chief Financial Officer function); and
The Company has included in the notes to the Financial Statements an explicit and unreserved statement
of compliance with the International Financial Reporting Standards.
This declaration is made in accordance with a resolution of the Directors made pursuant to section 295(5) of the
Corporations Act 2001 (Cth).
Farooq Khan
Executive Chairman and
Managing Director
30 August 2019
Victor Ho
Executive Director and
Company Secretary
ANNUAL REPORT | 48
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
ADDITIONAL ASX INFORMATION
as at 11 October 2019
CORPORATE GOVERNANCE STATEMENT
The Company has adopted the Corporate Governance Principles and Recommendations (3rd Edition, March 2014)
issued by the ASX Corporate Governance Council in respect of the financial year ended 30 June 2019.
Pursuant to ASX Listing Rule 4.10.3, the Company’s 2019 Corporate Governance Statement (dated on or about 22
October 2019) and ASX Appendix 4G (Key to Disclosures of Corporate Governance Principles and
Recommendations) can be
Internet website:
http://queste.com.au/corporate-governance
following URL on
the Company’s
found at
the
VOTING RIGHTS
Subject to any rights or restrictions for the time being attached to any class or classes of shares (at present there
are none), at meetings of shareholders of the Company:
(1)
(2)
(3)
Each shareholder entitled to vote may vote in person or by proxy or by power of attorney or, in the case
of a shareholder which is a corporation, by representative;
Every person who is present in the capacity of shareholder or the representative of a corporate
shareholder shall, on a show of hands, have one vote;
Every shareholder who is present in person, by proxy, by power of attorney or by corporate representative
shall, on a poll, have one vote in respect of every fully paid share held by him; and
SUBSTANTIAL SHAREHOLDERS
Substantial Shareholders
Registered Shareholder
Shareholding
Azhar Chaudhri,
Chi Tung Investments Limited
and Renmuir Holdings Limited1
Farooq Khan
and Associate2
Geoff Wilson
and Associates3
Fred Woollard and
Samuel Terry Asset Management Pty
Ltd ATF Samuel Terry Absolute Return
Fund4
Chi Tung Investments Ltd
Renmuir Holdings Ltd
Mr Azhar Chaudhri
Mr Farooq Khan
& Ms Rosanna De Campo
Island Australia Pty Ltd
Dynasty Peak Pty Ltd
J P Morgan Nominees Australia
Limited
Total
Shares
%Voting
Power5
8,322,737
30.74%
5,344,872
19.74%
3,608,956
3,277,780
1,436,001
4,921,295
423,577
4,391,975
4,391,975
16.22%
3,875,568
Frederick Raymond Woollard
21,862
3,902,430
14.41%
Rag & Bone Securities Pty Ltd
5,000
Notes:
(1)
(2)
(3)
(4)
(5)
Based on the substantial shareholding notice filed by Azhar Chaudhri and associates dated 23 October 2017 (updated to reflect current
registered shareholdings and percentage voting power).
Based on the Change of Interests of Substantial Holder notice filed by Farooq Khan and associates dated 20 November 2014 and the
Change of Director’s Interest Notice filed by Farooq Khan dated 10 July 2019 (updated to reflect current registered shareholdings and
percentage voting power).
Based on the Change of Interests of Substantial Holder Notice filed by Geoff Wilson and associates dated 14 February 2018.
Based on the Notice of Initial Substantial Holder notice filed by Samuel Terry Asset Management Pty Ltd dated 5 February 2018 (updated
to reflect current registered shareholdings and percentage voting power).
Movements of less than 1% in voting power are not required to be disclosed to ASX via an updated substantial shareholding notice and
accordingly, there may be variances between the shareholdings recorded in the table above and the most recent substantial
shareholding notices lodged on ASX. Current registered shareholdings have been disclosed (where applicable).
ANNUAL REPORT | 52
30 JUNE 2019
QUESTE COMMUNICATIONS LTD
A.B.N. 58 081 688 164
ADDITIONAL ASX INFORMATION
as at 11 October 2019
DISTRIBUTION OF LISTED ORDINARY FULLY PAID SHARES
Spread of Holdings
1
1,001
5,001
10,001
100,001
Total
-
-
-
-
-
1,000
5,000
10,000
100,000
and over
Number of Holders
17
44
58
86
21
Number of Units
8,811
121,362
520,496
2,398,667
24,022,996
% of Total Issue Capital
0.03%
0.45%
1.92%
8.86%
88.74%
226
27,072,332
100.00%
UNMARKETABLE PARCELS
Spread
of Holdings
Number of Holders
Number of Shares
% of Total Issued Capital
1
- 8,064
8,065
Total
- over
78
148
226
244,520
26,827,812
27,072,332
0.90%
99.10%
100.00%
An unmarketable parcel is considered, for the purposes of the above table, to be a shareholding of 8,064 shares or less, being a
value of $500 or less in total, based upon the Company’s last sale price on ASX as at 10 October 2019 of $0.062 per share.
TOP 20 ORDINARY FULLY PAID SHAREHOLDERS
Rank Shareholder
Shares
Held
Total
Shares
% Issued
Capital
1
2
3
4
5
6
7
8
9
CHI TUNG INVESTMENTS LTD
MR AZHAR AMIN CHAUDHRI
RENMUIR HOLDINGS LTD
ISLAND AUSTRALIA PTY LTD
MR FAROOQ KHAN + MS ROSANNA DE CAMPO
DYNASTY PEAK PTY LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
MS ROSANNA DE CAMPO
GA & AM LEAVER INVESTMENTS PTY LTD
GLENVIEW SERVICES PTY LTD
GIBSON KILLER PTY LTD
MR AYUB KHAN
10 MRS AFIA KHAN
11
ROSEMONT ASSET PTY LTD
MR SIMON KENNETH CATO + MRS KAYE LOUISE HOPKINS
12
TOMATO 2 PTY LTD
13 MR JOHN CHENG-HSIANG YANG + MS PEGA PING PING MOK
14 MR ANTHONY NEALE KILLER + MRS SANDRA MARIE KILLER
15 MR EUGENE RODRIGUEZ
16 MRS MARY THERESE CAMILLERI
17 MRS LINDA ANN OATES
18
DR SIEW NAM UN
19 MRS WENDY MARGARET BELL
20 MANAR NOMINEES PTY LTD
Total
3,608,956
1,436,001
3,277,780
Sub-total
423,577
4,921,295
Sub-total
75,000
118,000
Sub-total
8,322,737
30.74
5,344,872
4,391,975
3,875,568
268,100
250,600
250,000
220,000
215,000
215,000
193,000
185,019
136,125
130,000
110,000
100,000
100,000
87,500
75,000
72,247
19.74
16.22
14.32
0.99
0.93
0.92
0.81
0.79
0.79
0.71
0.68
0.50
0.48
0.41
0.37
0.37
0.32
0.28
0.27
24,542,743
90.64
ANNUAL REPORT | 53
ASX Code: QUE
Queste Communications Ltd
A.B.N. 58 081 688 164
PRINCIPAL & REGISTERED OFFICE:
Level 2
23 Ventnor Avenue
West Perth, Western Australia 6005
T | (08) 9214 9777
F | (08) 9214 9701
E | info@queste.com.au
W | www.queste.com.au
SHARE REGISTRY:
Advanced Share Registry Limited
Western Australia – Main Office
110 Stirling Highway
Nedlands, Western Australia 6009
PO Box 1156, Nedlands
Western Australia 6909
Local T | 1300 113 258
T | (08) 9389 8033
F | (08) 9262 3723
E | admin@advancedshare.com.au
New South Wales – Branch Office
Suite 8H, 325 Pitt Street
Sydney, New South Wales 2000
PO Box Q1736
Queen Victoria Building, New South Wales 1230
T | (02) 8096 3502
W | www.advancedshare.com.au